SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
March 25, 2002
CONTINENTAL AIRLINES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-09781 74-2099724
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Indentification No.)
1600 Smith Street, Dept. HQSEO, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
(713) 324-5000
(Registrant's telephone number, including area code)
Item 7. Financial Statements and Exhibits.
(c) Exhibits. The Exhibit Index is hereby incorporated by reference. The
documents listed on the Exhibit Index are filed as Exhibits with reference to
the Registration Statement on Form S-3 (Registration No. 333-67886) of
Continental Airlines, Inc. The Registration Statement and the final Prospectus
Supplement, dated March 11, 2002, to the Prospectus, dated August 23, 2001,
relate to the offering of Continental Airlines, Inc.'s Class G-1 and Class G-2
Pass Through Certificates, Series 2002-1.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, Continental
Airlines, Inc. has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONTINENTAL AIRLINES, INC.
By /S/ JENNIFER L. VOGEL
-------------------------
Jennifer L. Vogel
Vice President and
General Counsel
April 9, 2002
EXHIBIT INDEX
1.1 Underwriting Agreement, dated March 11, 2002, among Credit Suisse
First Boston Corporation, J.P. Morgan Securities Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc. and Morgan Stanley & Co. Incorporated, as Underwriters, Credit
Suisse First Boston, New York branch, as Depositary, and Continental
Airlines, Inc.
4.1 Trust Supplement No. 2002-1G-1-O, dated as of March 25, 2002,
between Wilmington Trust Company, as Trustee, and Continental
Airlines, Inc. to Pass Through Trust Agreement, dated as of
September 25, 1997
4.2 Trust Supplement No. 2002-1G-1-S, dated as of March 25, 2002,
between Wilmington Trust Company, as Trustee, and Continental
Airlines, Inc. to Pass Through Trust Agreement, dated as of
September 25, 1997
4.3 Trust Supplement No. 2002-1G-2-O, dated as of March 25, 2002,
between Wilmington Trust Company, as Trustee, and Continental
Airlines, Inc. to Pass Through Trust Agreement, dated as of
September 25, 1997
4.4 Trust Supplement No. 2002-1G-2-S, dated as of March 25, 2002,
between Wilmington Trust Company, as Trustee, and Continental
Airlines, Inc. to Pass Through Trust Agreement, dated as of
September 25, 1997
4.5 Revolving Credit Agreement (2002-1G-1), dated as of March 25, 2002,
between Wilmington Trust Company, as Subordination Agent, as
Borrower, and Landesbank Hessen-Thuringen Girozentrale, as Primary
Liquidity Provider
4.6 Revolving Credit Agreement (2002-1G-2), dated as of March 25, 2002,
between Wilmington Trust Company, as Subordination Agent, as
Borrower, and Landesbank Hessen-Thuringen Girozentrale, as Primary
Liquidity Provider
4.7 ISDA Master Agreement, dated as of March 25, 2002, between Merrill
Lynch Capital Services, Inc. and Wilmington Trust Company, as
Subordination Agent
4.8 Schedule to the Master Agreement, dated as of March 25, 2002,
between Merrill Lynch Capital Services, Inc. and Wilmington Trust
Company, as Subordination Agent
4.9 Class G-1 Above Cap Liquidity Facility Confirmation, dated March 25,
2002, from Merrill Lynch Capital Services, Inc. to Wilmington Trust
Company, as Subordination Agent
4.10 Guarantee, dated March 25, 2002, of Merrill Lynch & Co. with respect
to the Class G-1 Above-Cap Liquidity Facility
4.11 Insurance and Indemnity Agreement, dated as of March 25, 2002, by
and among Ambac Assurance Corporation, as Policy Provider,
Continental Airlines, Inc. and Wilmington Trust Company, as
Subordination Agent
4.12 Ambac Certificate Guaranty Insurance Policy, dated March 25, 2002,
bearing Policy Number AB0542BE, and the corresponding Certificate
Guaranty Insurance Policy Endorsement, dated March 25, 2002, issued
to Wilmington Trust Company, as Subordination Agent and Trustee, and
Landesbank Hessen-Thuringen Girozentrale, as Class G-1 Primary
Liquidity Provider
4.13 Ambac Certificate Guaranty Insurance Policy, dated March 25, 2002,
bearing Policy Number AB0543BE, and the corresponding Certificate
Guaranty Insurance Policy Endorsement, dated March 25, 2002, issued
to Wilmington Trust Company, as Subordination Agent and Trustee, and
Landesbank Hessen-Thuringen Girozentrale, as Class G-2 Primary
Liquidity Provider
4.14 Intercreditor Agreement, dated as of March 25, 2002, among
Wilmington Trust Company, as Trustee, Landesbank Hessen-Thuringen
Girozentrale, as Class G-1 and Class G-2 Primary Liquidity Provider,
Merrill Lynch Capital Services, Inc., as Class G-1 Above-Cap
Liquidity Provider, Ambac Assurance Corporation, as Policy Provider,
and Wilmington Trust Company, as Subordination Agent and Trustee
4.15 Deposit Agreement (Class G-1), dated as of March 25, 2002, between
Wells Fargo Bank Northwest, National Association, as Escrow Agent,
and Credit Suisse First Boston, New York branch, as Depositary
4.16 Deposit Agreement (Class G-2), dated as of March 25, 2002, between
Wells Fargo Bank Northwest, National Association, as Escrow Agent,
and Credit Suisse First Boston, New York branch, as Depositary
4.17 Escrow and Paying Agent Agreement (Class G-1), dated as of March 25,
2002, among Wells Fargo Bank Northwest, National Association, as
Escrow Agent, Credit Suisse First Boston Corporation, J.P. Morgan
Securities Inc., Merrill Lynch, Pierce Fenner & Smith Incorporated,
Salomon Smith Barney Inc. and Morgan Stanley & Co. Incorporated, as
Underwriters, Wilmington Trust Company, as Trustee, and Wilmington
Trust Company, as Paying Agent
4.18 Escrow and Paying Agent Agreement (Class G-2), dated as of March 25,
2002, among Wells Fargo Bank Northwest, National Association, as
Escrow Agent, Credit Suisse First Boston Corporation, J.P. Morgan
Securities Inc., Merrill Lynch, Pierce Fenner & Smith Incorporated,
Salomon Smith Barney Inc. and Morgan Stanley & Co. Incorporated, as
Underwriters, Wilmington Trust Company, as Trustee, and Wilmington
Trust Company, as Paying Agent
4.19 Note Purchase Agreement, dated as of March 25, 2002, among
Continental Airlines, Inc., Wilmington Trust Company, as Trustee,
Wilmington Trust Company, as Subordination Agent, Wells Fargo Bank
Northwest, National Association, as Escrow Agent, and Wilmington
Trust Company, as Paying Agent
4.20 Form of Participation Agreement (Participation Agreement between
Continental Airlines, Inc., Owner, and Wilmington Trust Company, as
Mortgagee, Subordination Agent and Trustee) (Exhibit B to Note
Purchase Agreement)
4.21 Form of Indenture (Trust Indenture and Mortgage between Continental
Airlines, Inc., Owner, and Wilmington Trust Company, as Mortgagee)
(Exhibit C to Note Purchase Agreement)
4.22 Reference Agency Agreement, dated as of March 25, 2002, between
Continental Airlines, Inc., Wilmington Trust Company, as
Subordination Agent, Wilmington Trust Company, as Loan Trustee,
Wilmington Trust Company, as Reference Agent, and Wells Fargo Bank
Northwest, National Association, as Escrow Agent.
4.23 LIBOR + 0.45% Continental Airlines Pass Through Certificate
2002-1G-1-O, Certificate No. 1
4.24 6.563% Continental Airlines Pass Through Certificate 2002-1G-2-O,
Certificate No. 1
23.1 Consent of AVITAS, Inc., dated March 11, 2002
23.2 Consent of BK Associates, Inc., dated March 11, 2002
23.3 Consent of Morten Beyer and Agnew, Inc., March 11, 2002
[Execution copy]
CONTINENTAL AIRLINES, INC., ISSUER
Pass Through Certificates, Series 2002-1
UNDERWRITING AGREEMENT
March 11, 2002
Credit Suisse First Boston Corporation
J.P. Morgan Securities Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
Morgan Stanley & Co. Incorporated
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010
c/o J.P. Morgan Securities Inc.
270 Park Avenue
New York, New York 10017
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower, 10th Floor
New York, NY 10281-1310
c/o Salomon Smith Barney Inc.
390 Greenwich Street, 4th Floor
New York, NY 10013
Dear Sirs:
Continental Airlines, Inc., a Delaware corporation (the "Company"),
proposes that Wilmington Trust Company, as trustee under each of the Original
Trusts (as defined below) (each, a "Trustee"), issue and sell to the
underwriters named on Schedule II hereto its pass through certificates in the
aggregate principal amounts and with the interest rates and final maturity dates
set forth on Schedule I hereto (the "Offered Certificates") on the terms and
conditions stated herein. Concurrently with the issuance of the Offered
Certificates, the Company is proposing that the Trustee issue and sell in the
respective aggregate principal amounts and with the respective interest rates
and final maturity dates set forth on Schedule IV hereto to one or more
purchasers (x) pass through certificates (the "Class H Certificates") under the
Continental Airlines Pass Through Trust, Series 2002-1H-O (the "Class H Trust")
and (y) pass through certificates (the "Class I Certificates") under the
Continental Airlines Pass Through Trust, Series 2002-1I-O (the "Class I Trust"),
in each case, pursuant to an agreement between the Company and such purchasers
(the "Certificate Purchase Agreement"). The Class H Certificates and the Class I
Certificates, together with the Offered Certificates, shall be referred to
herein as the "Certificates".
The Certificates will be issued pursuant to a Pass Through Trust
Agreement, dated as of September 25, 1997 (the "Basic Agreement"), between the
Company and the Trustee, as supplemented with respect to the issuance of each
class of Certificates by a separate Pass Through Trust Supplement to be dated as
of the Closing Date (as defined below) (individually, an "Original Trust
Supplement"), between the Company and the Trustee (the Basic Agreement as
supplemented by each such Original Trust Supplement being referred to herein
individually as an "Original Pass Through Trust Agreement"). The Original Trust
Supplements are related to the creation and administration of Continental
Airlines Pass Through Trust 2002-1G-1-O (the "Class G-1 Trust"), Continental
Airlines Pass Through Trust 2002-1G-2-O (the "Class G-2 Trust" and, together
with the Class G-1 Trust, the "Class G Trusts", and the Class G Trusts,
collectively with the Class H Trust and the Class I Trust, the "Original
Trusts"), the Class H Trust and the Class I Trust. As used herein, unless the
context otherwise requires, the term "Underwriters" shall mean the firms named
as Underwriters in Schedule II, and the term "you" shall mean, collectively,
Credit Suisse First Boston Corporation ("CSFB"), J.P. Morgan Securities Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Salomon Smith Barney Inc.
The cash proceeds of the offering of Offered Certificates by each
Class G Trust, to the extent not used to purchase Equipment Notes (as defined in
the Note Purchase Agreement (as defined below)) on the Closing Date, will be
paid to Wells Fargo Bank Northwest, National Association, as escrow agent (the
"Escrow Agent"), under an Escrow and Paying Agent Agreement among the Escrow
Agent, the Underwriters, the Trustee of such Class G Trust and Wilmington Trust
Company, as paying agent (the "Paying Agent"), for the benefit of the holders of
Offered Certificates issued by such Class G Trust (each, an "Escrow Agreement").
The Escrow Agent will deposit such cash proceeds (each, a "Deposit") with Credit
Suisse First Boston, New York Branch (the "Depositary"), in accordance with a
Deposit Agreement relating to such Class G Trust (each, a "Deposit Agreement"),
and, subject to the fulfillment of certain conditions, will withdraw Deposits
upon request to allow the Trustee to purchase Equipment Notes from time to time
pursuant to a Note Purchase Agreement to be dated as of the Closing Date (the
"Note Purchase Agreement") among the Company, Wilmington Trust Company, as
Trustee of each of the Original Trusts, as Subordination Agent (as hereinafter
defined) and as Paying Agent, and the Escrow Agent. Each Escrow Agent will issue
receipts to be attached to each related Offered Certificate ("Escrow Receipts")
representing each holder's fractional undivided interest in amounts deposited
with such Escrow Agent with respect to the related class of Offered Certificates
and will pay to such holders through the related Paying Agent interest accrued
on the Deposits and received by such Paying Agent pursuant to the related
Deposit Agreement at a rate per annum equal to the interest rate applicable to
the corresponding Offered Certificates.
On the earlier of (i) the first Business Day following August 31,
2002 or, if later, the fifth Business Day following the Delivery Period
Termination Date (as defined in the Note Purchase Agreement) and (ii) the fifth
Business Day following the occurrence of a Triggering Event (as defined in the
Intercreditor Agreement) (such Business Day, the "Trust Transfer Date"), each of
the Original Trusts will transfer and assign all of its assets and rights to a
newly-created successor trust with substantially identical terms except as
described in the Prospectus Supplement (as hereinafter defined) (each, a
"Successor Trust" and, together with the Original Trusts, the "Trusts") governed
by the Basic Agreement, as supplemented with respect to each class of
Certificates by a separate Pass Through Trust Supplement (individually, a
"Successor Trust Supplement"), between the Company and the Trustee (the Basic
Agreement, as supplemented by each such Successor Trust Supplement, being
referred to herein individually as a "Successor Pass Through Trust Agreement"
and, together with the Original Pass Through Trust Agreements, the "Designated
Agreements"). Each Certificate outstanding on the Trust Transfer Date will
represent the same interest in the Successor Trust as the Certificate
represented in the Original Trust. Wilmington Trust Company initially will also
act as trustee of the Successor Trusts (each, a "Successor Trustee").
Certain amounts of interest payable on the Offered Certificates
issued by the Class G-1 Trust will be entitled to the benefits of a primary
liquidity facility and an above-cap liquidity facility. Certain amounts of
interest payable on the Offered Certificates issued by the Class G-2 Trust will
be entitled to the benefits of a primary liquidity facility. Landesbank
Hessen-Thuringen Girozentrale (the "Primary Liquidity Provider") will enter into
separate revolving credit agreements with respect to each of the Class G Trusts
(collectively, the "Primary Liquidity Facilities") to be dated as of the Closing
Date for the benefit of the holders of the Offered Certificates issued by such
Class G Trust. Merrill Lynch Capital Services, Inc. (the "Above-Cap Liquidity
Provider") will enter into a separate interest rate cap agreement with respect
to the Class G-1 Trust (the "Above-Cap Liquidity Facility" and, together with
the Primary Liquidity Facilities, the "Liquidity Facilities") to be dated as of
the Closing Date for the benefit of the holders of the Offered Certificates
issued by the Class G-1 Trust. The Primary Liquidity Provider, the Above-Cap
Liquidity Provider, Ambac Assurance Corporation, as provider of the Policies
referred to below (in such capacity, the "Policy Provider"), and the holders of
the Offered Certificates will be entitled to the benefits of an Intercreditor
Agreement to be dated as of the Closing Date (the "Intercreditor Agreement")
among the Trustees, Wilmington Trust Company, as subordination agent and trustee
thereunder (the "Subordination Agent"), the Policy Provider, the Primary
Liquidity Provider and the Above-Cap Liquidity Provider.
Payments of interest on the Offered Certificates will be supported
by separate certificate guarantee insurance policies for each of the Class G-1
Trust and the Class G-2 Trust (together, the "Policies") issued by the Policy
Provider to the extent the Liquidity Facilities and any funds contained in the
cash collateral accounts funded from the Primary Liquidity Facilities are
insufficient or unavailable for that purpose. The Policies will also support the
payment of the final distributions on the Offered Certificates and will take
effect in certain other circumstances described in the Intercreditor Agreement
and the Policies. The Policies will be issued pursuant to an Insurance and
Indemnity Agreement to be dated as of the Closing Date (the "Policy Provider
Agreement") among the Policy Provider, the Company and the Subordination Agent.
Under the Intercreditor Agreement and the Policy Provider Agreement, the Policy
Provider will be entitled to reimbursement for amounts paid pursuant to claims
made under the Policies, subject to certain limitations.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a shelf registration statement on Form S-3 (File No.
333-67886) relating to pass through certificates (such registration statement
(including the respective exhibits thereto and the respective documents filed by
the Company with the Commission pursuant to the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act"), that are incorporated by reference therein),
as amended at the date hereof, being herein referred to as the "Registration
Statement") and the offering thereof from time to time in accordance with Rule
415 of the Securities Act of 1933, as amended, and the rules and regulations of
the Commission thereunder (collectively, the "Securities Act"). The Registration
Statement has been declared effective by the Commission. A final prospectus
supplement reflecting the terms of the Offered Certificates, the terms of the
offering thereof and other matters relating to the Offered Certificates, as
further specified in Section 4(d) hereof, will be prepared and filed together
with the basic prospectus referred to below pursuant to Rule 424 under the
Securities Act (such prospectus supplement, in the form first filed on or after
the date hereof pursuant to Rule 424, being herein referred to as the
"Prospectus Supplement" and any such prospectus supplement in the form or forms
filed prior to the filing of the Prospectus Supplement being herein referred to
as a "Preliminary Prospectus Supplement"). The basic prospectus included in the
Registration Statement and relating to all offerings of pass through
certificates under the Registration Statement, as supplemented by the Prospectus
Supplement, and including the documents incorporated by reference therein, is
herein called the "Prospectus", except that, if such basic prospectus is amended
or supplemented on or prior to the date on which the Prospectus Supplement is
first filed pursuant to Rule 424, the term "Prospectus" shall refer to such
basic prospectus as so amended or supplemented and as supplemented by the
Prospectus Supplement. Any reference herein to the terms "amendment" or
"supplement" with respect to the Prospectus or any Preliminary Prospectus
Supplement shall be deemed to refer to and include any documents filed with the
Commission under the Exchange Act after the date the Prospectus is filed with
the Commission, or the date of such Preliminary Prospectus Supplement, as the
case may be, and incorporated therein by reference pursuant to Item 12 of Form
S-3 under the Securities Act (other than the filings of the Company on Form 8-K
relating to the incorporation by reference of certain information relating to
the Policy Provider (the "Policy Provider 8-Ks")).
Capitalized terms not otherwise defined in this Underwriting
Agreement (the "Agreement") shall have the meanings specified therefor in the
Original Pass Through Trust Agreements, in the Note Purchase Agreement or in the
Intercreditor Agreement; PROVIDED that, as used in this Agreement, the term
"Operative Agreements" shall mean the Deposit Agreements, the Escrow Agreements,
the Intercreditor Agreement, the Liquidity Facilities, the Policies, the Policy
Provider Agreement, the Indemnification Agreement dated the date hereof (the
"Indemnification Agreement") between the Policy Provider and the Underwriters,
the Designated Agreements, the Assignment and Assumption Agreements, the
Reference Agency Agreement, the Certificate Purchase Agreement and the Financing
Agreements (as defined in the Note Purchase Agreement).
1. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants to, and agrees with each Underwriter that:
(i) The Company meets the requirements for use of Form S-3 under the
Securities Act; the Registration Statement has become effective; and, on
the original effective date of the Registration Statement, the Registration
Statement complied in all material respects with the requirements of the
Securities Act. On the original effective date of the Registration
Statement, the Registration Statement did not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and on
the date hereof and on the Closing Date, the Prospectus, as amended and
supplemented, if the Company shall have furnished any amendment or
supplement thereto, does not and will not include an untrue statement of a
material fact and does not and will not omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding
sentence does not apply to (x) statements in or omissions from the
Registration Statement, the Preliminary Prospectus or the Prospectus based
upon (A) written information furnished to the Company by any Underwriter
through any of you expressly for use therein ("Underwriter Information"),
(B) the Depositary Information (as hereinafter defined) or (C) information
under the caption "Description of the Policy Provider" in the Preliminary
Prospectus or the Prospectus, documents incorporated by reference under
such caption or the Policy Provider 8-Ks (collectively, the "Policy
Provider Information") or (y) statements or omissions in that part of each
Registration Statement which shall constitute the Statement of Eligibility
of the Trustee under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), on Form T-1.
(ii) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act (excluding the
Policy Provider Information), at the time they were or hereafter, during
the period mentioned in paragraph 4(a) below, are filed with the
Commission, complied or will comply, as the case may be, in all material
respects with the requirements of the Exchange Act.
(iii) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own, lease and operate its property and to
conduct its business as described in the Prospectus; and the Company is
duly qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of
operations of the Company and its consolidated subsidiaries taken as a
whole (a "Continental Material Adverse Effect").
(iv) Each of Continental Micronesia, Inc., Air Micronesia Inc. and
ExpressJet Airlines, Inc. (together, the "Subsidiaries") has been duly
incorporated and is an existing corporation in good standing under the laws
of the jurisdiction of its incorporation, with corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus; and each Subsidiary is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified would not have a Continental Material Adverse
Effect; all of the issued and outstanding capital stock of each Subsidiary
has been duly authorized and validly issued and is fully paid and
nonassessable; and, except as described in the Prospectus, each
Subsidiary's capital stock owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(v) Except as described in the Prospectus, the Company is not in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which it is a party or by
which it may be bound or to which any of its properties may be subject,
except for such defaults that would not have a Continental Material Adverse
Effect. The execution, delivery and performance of this Agreement and the
Operative Agreements to which the Company is or will be a party and the
consummation of the transactions contemplated herein and therein have been
duly authorized by all necessary corporate action of the Company and will
not result in any breach of any of the terms, conditions or provisions of,
or constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance (other than any lien, charge or encumbrance
created under any Operative Agreement) upon any property or assets of the
Company pursuant to any indenture, loan agreement, contract, mortgage,
note, lease or other instrument to which the Company is a party or by which
the Company may be bound or to which any of the property or assets of the
Company is subject, which breach, default, lien, charge or encumbrance,
individually or in the aggregate, would have a Continental Material Adverse
Effect, nor will any such execution, delivery or performance result in any
violation of the provisions of the charter or by-laws of the Company or any
statute, any rule, regulation or order of any governmental agency or body
or any court having jurisdiction over the Company.
(vi) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
valid authorization, execution and delivery by the Company of this
Agreement and the Operative Agreements to which it is or will be a party
and for the consummation of the transactions contemplated herein and
therein, except (x) such as may be required under the Securities Act, the
Trust Indenture Act, the securities or "blue sky" or similar laws of the
various states and of foreign jurisdictions or rules and regulations of the
National Association of Securities Dealers, Inc., and (y) filings or
recordings with the Federal Aviation Administration (the "FAA") and under
the Uniform Commercial Code as is in effect in the State of Texas, the
State of Delaware and the State of Utah, which filings or recordings
referred to in this clause (y), with respect to any particular set of
Financing Agreements, shall have been made, or duly presented for filing or
recordation, or shall be in the process of being duly filed or filed for
recordation, on or prior to the applicable Funding Date for the Aircraft
related to such Financing Agreements.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company and the Operative Agreements to which the Company
will be a party will be duly executed and delivered by the Company on or
prior to the Closing Date or the applicable Funding Date, as the case may
be.
(viii) The Operative Agreements to which the Company is or will be a
party, when duly executed and delivered by the Company, assuming that such
Operative Agreements have been duly authorized, executed and delivered by,
and constitute the legal, valid and binding obligations of, each other
party thereto, will constitute valid and binding obligations of the Company
enforceable in accordance with their terms, except (w) as enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, (x) as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and (y) with respect to
indemnification and contribution provisions, as enforcement thereof may be
limited by applicable law, and subject, in the case of the Successor Pass
Through Trust Agreements, to the delayed effectiveness thereof as set forth
therein. The Basic Agreement as executed is substantially in the form filed
as an exhibit to the Company's current report on Form 8-K dated September
25, 1997 and has been duly qualified under the Trust Indenture Act. The
Offered Certificates and the Designated Agreements to which the Company is,
or is to be, a party will conform in all material respects to the
descriptions thereof in the Prospectus.
(ix) The consolidated financial statements of the Company
incorporated by reference in the Prospectus, together with the related
notes thereto, present fairly in all material respects the financial
position of the Company and its consolidated subsidiaries at the dates
indicated and the consolidated results of operations and cash flows of the
Company and its consolidated subsidiaries for the periods specified. Such
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved, except as otherwise stated therein and except that the
unaudited financial statements do not have all required footnotes. The
financial statement schedules of the Company, if any, incorporated by
reference in the Prospectus present the information required to be stated
therein.
(x) The Company is a "citizen of the United States" within the
meaning of Section 40102(a)(15) of Title 49 of the United States Code, as
amended, and holds an air carrier operating certificate issued pursuant to
Chapter 447 of Title 49 of the United States Code, as amended, for aircraft
capable of carrying 10 or more individuals or 6,000 pounds or more of
cargo. All of the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and
non-assessable.
(xi) On or prior to the Closing Date, the issuance of the
Certificates will be duly authorized by the Trustee. When duly executed,
authenticated, issued and delivered in the manner provided for in the
Original Pass Through Trust Agreements and sold and paid for as provided in
this Agreement and the Certificate Purchase Agreement, the Certificates
will be legally and validly issued and will be entitled to the benefits of
the relevant Original Pass Through Trust Agreements; based on applicable
law as in effect on the date hereof, upon the execution and delivery of the
Assignment and Assumption Agreements in accordance with the Original Pass
Through Trust Agreements, the Certificates will be legally and validly
outstanding under the related Successor Pass Through Trust Agreements; and
when executed, authenticated, issued and delivered in the manner provided
for in the Escrow Agreements, the Escrow Receipts will be legally and
validly issued and will be entitled to the benefits of the related Escrow
Agreements.
(xii) Except as disclosed in the Prospectus, the Company and the
Subsidiaries have good and marketable title to all real properties and all
other properties and assets owned by them, in each case free from liens,
encumbrances and defects except where the failure to have such title would
not have a Continental Material Adverse Effect; and except as disclosed in
the Prospectus, the Company and the Subsidiaries hold any leased real or
personal property under valid and enforceable leases with no exceptions
that would have a Continental Material Adverse Effect.
(xiii) Except as disclosed in the Prospectus, there is no action,
suit or proceeding before or by any governmental agency or body or court,
domestic or foreign, now pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries or any of their
respective properties that individually (or in the aggregate in the case of
any class of related lawsuits), could reasonably be expected to result in a
Continental Material Adverse Effect or that could reasonably be expected to
materially and adversely affect the consummation of the transactions
contemplated by this Agreement or the Operative Agreements.
(xiv) Except as disclosed in the Prospectus, no labor dispute with
the employees of the Company or any subsidiary exists or, to the knowledge
of the Company, is imminent that could reasonably be expected to have a
Continental Material Adverse Effect.
(xv) Each of the Company and the Subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and has made all declarations and filings with, all federal,
state, local and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease, license
and use its properties and assets and to conduct its business in the manner
described in the Prospectus, except to the extent that the failure to so
obtain, declare or file would not have a Continental Material Adverse
Effect.
(xvi) Except as disclosed in the Prospectus, (x) neither the Company
nor any of the Subsidiaries is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances (collectively, "environmental laws"), owns or
operates any real property contaminated with any substance that is subject
to any environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim
individually or in the aggregate is reasonably expected to have a
Continental Material Adverse Effect, and (y) the Company is not aware of
any pending investigation which might lead to such a claim that is
reasonably expected to have a Continental Material Adverse Effect.
(xvii) The accountants that examined and issued an auditors' report
with respect to the consolidated financial statements of the Company and
the financial statement schedules of the Company, if any, included or
incorporated by reference in the Registration Statement are independent
public accountants within the meaning of the Securities Act.
(xviii) Neither the Company nor any of the Original Trusts is, nor
(based on applicable law as in effect on the date hereof) will any of the
Successor Trusts be, as of the execution and delivery of the Assignment and
Assumption Agreements in accordance with the Original Pass Through Trust
Agreements, an "investment company", or an entity "controlled" by an
"investment company", within the meaning of the Investment Company Act of
1940, as amended (the "Investment Company Act"), in each case required to
register under the Investment Company Act; and after giving effect to (i)
the offering and sale of the Offered Certificates and the application of
the proceeds thereof as described in the Prospectus and (ii) the offering
and sale of the Class H Certificates and the Class I Certificates and the
application of the proceeds thereof as provided in the Certificate Purchase
Agreement, neither the Original Trusts will be, nor (based on applicable
law as in effect on the date hereof) will any of the Successor Trusts be,
as of the execution and delivery of the Assignment and Assumption
Agreements in accordance with the Original Pass Through Trust Agreements,
nor will the escrow arrangements contemplated by the Escrow Agreements
result in the creation of, an "investment company", or an entity
"controlled" by an "investment company", as defined in the Investment
Company Act, in each case required to register under the Investment Company
Act.
(xix) This Agreement and the other Operative Agreements to which the
Company is or will be a party will, upon execution and delivery thereof,
conform in all material respects to the descriptions thereof contained in
the Prospectus (other than, in the case of the Financing Agreements, as
described in the Prospectus).
(xx) No Appraiser is an affiliate of the Company or, to the
knowledge of the Company, has a substantial interest, direct or indirect,
in the Company. To the knowledge of the Company, none of the officers and
directors of any of such Appraisers is connected with the Company or any of
its affiliates as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
(b) The Depositary represents and warrants to, and agrees with, each
Underwriter and the Company that:
(i) The information pertaining to the Depositary set forth under the
caption "Description of the Deposit Agreements -- Depositary"
(collectively, the "Depositary Information") in the Prospectus, as amended
and supplemented, if the Company shall have furnished any amendment or
supplement thereto, does not, and will not as of the Closing Date, contain
any untrue statement of a material fact.
(ii) The Depositary has been duly organized and is validly existing
in good standing under the laws of Switzerland and is duly qualified to
conduct banking business in the State of New York through its New York
branch, with corporate power and authority to own, lease and operate its
property, to conduct its business as described in the Depositary
Information and to enter into and perform its obligations under this
Agreement and the Deposit Agreements.
(iii) No consent, approval, authorization, or order of, or filing
with any governmental agency or body or any court is required for the valid
authorization, execution and delivery by the Depositary of this Agreement
and the Deposit Agreements and for the consummation of the transactions
contemplated herein and therein, except such as may have been obtained.
(iv) The execution and delivery by the Depositary of this Agreement
and the Deposit Agreements and the consummation of the transactions
contemplated herein and therein have been duly authorized by the Depositary
and will not violate any law, governmental rule or regulation or any of its
organizational documents or any order, writ, injunction or decree of any
court or governmental agency against it or the provisions of any indenture,
loan agreement, contract or other instrument to which it is a party or is
bound.
(v) This Agreement has been duly authorized, executed and delivered
by the Depositary, and the Deposit Agreements will be duly authorized,
executed and delivered by the Depositary on or prior to the Closing Date.
(vi) The Deposit Agreements, when duly authorized, executed and
delivered by the Depositary, assuming that such Deposit Agreements have
been duly authorized, executed and delivered by, and constitute the legal,
valid and binding obligations of, the Escrow Agent, will constitute the
legal, valid and binding obligations of the Depositary enforceable in
accordance with their terms, except (x) as enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or other
similar laws now or hereinafter in effect relating to creditors' rights
generally and (y) as enforcement thereof is subject to general principles
of equity (regardless of whether enforcement is considered in a proceeding
in equity or at law).
(vii) Payments of interest and principal in respect of the Deposits
are not subject under the laws of Switzerland or any political subdivision
thereof to any withholdings or similar charges or deductions.
(c) The parties agree that any certificate signed by a duly
authorized officer of the Company and delivered to an Underwriter, or to counsel
for the Underwriters, on the Closing Date and in connection with this Agreement
or the offering of the Offered Certificates, shall be deemed a representation
and warranty by (and only by) the Company to the Underwriters as to the matters
covered thereby.
2. PURCHASE, SALE AND DELIVERY OF OFFERED CERTIFICATES. (a) On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and the conditions herein set forth, the Company agrees to
cause the Trustees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Trustees, at a purchase price of
100% of the principal amount thereof, the aggregate principal amount of Offered
Certificates of each Pass Through Certificate designation set forth opposite the
name of such Underwriter in Schedule II. Concurrently with the issuance of the
Offered Certificates, the Escrow Agents shall issue and deliver to the Trustees
the Escrow Receipts in accordance with the terms of the Escrow Agreements, which
Escrow Receipts shall be attached to the related Offered Certificates.
(b) The Company is advised by you that the Underwriters propose to
make a public offering of the Offered Certificates as set forth in the
Prospectus Supplement as soon after this Agreement has been entered into as in
your judgment is advisable. The Company is further advised by you that the
Offered Certificates are to be offered to the public initially at 100% of their
principal amount -- the public offering price -- plus accrued interest, if any,
and to certain dealers selected by the Underwriters at concessions not in excess
of the concessions set forth in the Prospectus, and that the Underwriters may
allow, and such dealers may reallow, concessions not in excess of the
concessions set forth in the Prospectus to certain other dealers.
(c) As underwriting commission and other compensation to the
Underwriters for their respective commitments and obligations hereunder in
respect of the Offered Certificates, including their respective undertakings to
distribute the Offered Certificates, the Company will pay to CSFB for the
accounts of the Underwriters the amount set forth in Schedule III hereto, which
amount shall be allocated among the Underwriters in the manner determined by
you. Such payment will be made on the Closing Date simultaneously with the
issuance and sale of the Offered Certificates (with attached Escrow Receipts) to
the Underwriters. Payment of such compensation shall be made by Federal funds
check or by wire transfer of immediately available funds.
(d) Delivery of and payment for the Offered Certificates (with
attached Escrow Receipts) shall be made at the offices of Hughes Hubbard & Reed
LLP at One Battery Park Plaza, New York, New York 10004 at 10:00 A.M. on March
25, 2002 or such other date, time and place as may be agreed upon by the Company
and you (such date and time of delivery and payment for the Offered Certificates
(with attached Escrow Receipts) being herein called the "Closing Date").
Delivery of the Offered Certificates (with attached Escrow Receipts) issued by
each Class G Trust shall be made to CSFB's account at The Depository Trust
Company ("DTC") for the respective accounts of the several Underwriters against
payment by the Underwriters of the purchase price thereof. Payment for the
Offered Certificates issued by each Class G Trust and the related Escrow
Receipts attached thereto shall be made by the Underwriters by wire transfer of
immediately available funds to the accounts and in the manner specified in the
related Escrow Agreement (PROVIDED, that if the Company notifies you that a
Delivery Date is occurring on the Closing Date, a portion of such payment in the
amount specified by the Company shall be paid to the accounts and in the manner
specified in the related Participation Agreement). The Offered Certificates
(with attached Escrow Receipts) issued by each Class G Trust shall be in the
form of one or more fully registered global Offered Certificates, and shall be
deposited with the related Trustee as custodian for DTC and registered in the
name of Cede & Co.
(e) The Company agrees to have the Offered Certificates (with
attached Escrow Receipts) available for inspection and checking by you in New
York, New York not later than 1:00 P.M. on the business day prior to the Closing
Date.
(f) It is understood that each Underwriter has authorized CSFB, on
its behalf and for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Offered Certificates (with attached
Escrow Receipts) that it has agreed to purchase. CSFB, individually and not as a
representative, may (but shall not be obligated to) make payment of the purchase
price for the Offered Certificates to be purchased by any Underwriter whose
check or checks shall not have been received by the Closing Date.
3. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations
of the Underwriters to purchase and pay for the Offered Certificates pursuant to
this Agreement are subject to the following conditions:
(a) On the Closing Date, no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the Securities
Act and no proceedings therefor shall have been instituted or threatened by
the Commission.
(b) On the Closing Date, you shall have received an opinion of
Hughes Hubbard & Reed LLP, counsel for the Company, dated the Closing Date,
in form and substance reasonably satisfactory to you and substantially to
the effect set forth in Exhibit A hereto.
(c) On the Closing Date, you shall have received an opinion of the
General Counsel of the Company, dated the Closing Date, in form and
substance reasonably satisfactory to you and substantially to the effect
set forth in Exhibit B hereto.
(d) On the Closing Date, you shall have received an opinion of
Richards, Layton & Finger, P.A., counsel for Wilmington Trust Company,
individually and as Trustee, Subordination Agent and Paying Agent, dated
the Closing Date, in form and substance reasonably satisfactory to you and
substantially to the effect set forth in Exhibit C hereto.
(e) On the Closing Date, you shall have received an opinion of Ray,
Quinney & Nebeker, counsel for the Escrow Agent, dated the Closing Date, in
form and substance reasonably satisfactory to you and substantially to the
effect set forth in Exhibit D hereto.
(f) On the Closing Date, you shall have received an opinion of
Katrin Schutz and Jurgen Necker, German in-house counsel for the Primary
Liquidity Provider, dated the Closing Date, in form and substance
reasonably satisfactory to you and substantially to the effect set forth in
Exhibit E hereto.
(g) On the Closing Date, you shall have received an opinion of
Pillsbury Winthrop LLP, special New York counsel to the Primary Liquidity
Provider, dated the Closing Date, in form and substance reasonably
satisfactory to you and substantially to the effect set forth in Exhibit F
hereto.
(h) On the Closing Date, you shall have received an opinion of
Suzette Hill, New York in-house counsel to the Above-Cap Liquidity
Provider, dated the Closing Date, in form and substance reasonably
satisfactory to you and substantially to the effect set forth in Exhibit G
hereto.
(i) On the Closing Date, you shall have received an opinion of New
York in-house counsel to the Above-Cap Liquidity Guarantor, dated the
Closing Date, in form and substance reasonably satisfactory to you and
substantially to the effect set forth in Exhibit H hereto.
(j) On the Closing Date, you shall have received an opinion of Roger
Machlis, New York in-house counsel for the Depositary, dated the Closing
Date, in form and substance reasonably satisfactory to you and
substantially to the effect set forth in Exhibit I hereto.
(k) On the Closing Date, you shall have received an opinion of
Giovanni Peditto, Swiss in-house counsel for the Depositary, dated the
Closing Date, in form and substance reasonably satisfactory to you and
substantially to the effect set forth in Exhibit J hereto.
(l) On the Closing Date, you shall have received an opinion of Juan
B. Roman, Vice President and Assistant General Counsel for the Policy
Provider, dated the Closing Date, in form and substance reasonably
satisfactory to you and substantially to the effect set forth in Exhibit K
hereto.
(m) On the Closing Date, you shall have received an opinion of
Milbank, Tweed, Hadley & McCloy LLP, counsel for the Underwriters, dated as
of the Closing Date, with respect to the issuance and sale of the Offered
Certificates, the Registration Statement, the Prospectus and other related
matters as the Underwriters may reasonably require.
(n) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries considered as one enterprise that, in your judgment, is
material and adverse and that makes it, in your judgment, impracticable to
proceed with the completion of the public offering of the Offered
Certificates on the terms and in the manner contemplated by the Prospectus.
(o) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Policy Provider and
its subsidiaries considered as one enterprise that, in your judgment, is
material and adverse and that makes it, in your judgment, impracticable to
proceed with the completion of the public offering of the Offered
Certificates on the terms and in the manner contemplated by the Prospectus.
(p) You shall have received on the Closing Date a certificate, dated
the Closing Date and signed by the President or any Vice President of the
Company, to the effect that the representations and warranties of the
Company contained in this Agreement are true and correct as of the Closing
Date as if made on the Closing Date (except to the extent that they relate
solely to an earlier date, in which case they shall be true and accurate as
of such earlier date), that the Company has performed all its obligations
to be performed hereunder on or prior to the Closing Date and that,
subsequent to the execution and delivery of this Agreement, there shall not
have occurred any material adverse change, or any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries considered as one enterprise, except as set
forth in or contemplated by the Prospectus.
(q) As of the Closing Date, the representations and warranties of
the Policy Provider contained in the Indemnification Agreement shall be
true and correct in all material respects as of the Closing Date (except to
the extent that they relate solely to an earlier or later date, in which
case they shall be true and correct as of such earlier or later date) and
the Underwriters shall have received a certificate of the President or a
Vice President of the Policy Provider, dated as of the Closing Date, to
such effect.
(r) You shall have received from Ernst & Young LLP a letter, dated
the date hereof, in form and substance satisfactory to you.
(s) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have been any downgrading in the
rating accorded any of the Company's securities (except for any pass
through certificates) by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2) under
the Securities Act, or any public announcement that any such organization
has under surveillance or review, in each case for possible change, its
ratings of any such securities other than pass through certificates (other
than an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating).
(t) Each of the Appraisers shall have furnished to the Underwriters
a letter from such Appraiser, addressed to the Company and dated the
Closing Date, confirming that such Appraiser and each of its directors and
officers (i) is not an affiliate of the Company or any of its affiliates,
(ii) does not have any substantial interest, direct or indirect, in the
Company or any of its affiliates and (iii) is not connected with the
Company or any of its affiliates as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar
functions.
(u) At the Closing Date, each of the Operative Agreements (other
than the Assignment and Assumption Agreements and the Financing Agreements)
shall have been duly executed and delivered by each of the parties thereto;
and the representations and warranties of the Company contained in each of
such executed Operative Agreements shall be true and correct as of the
Closing Date (except to the extent that they relate solely to an earlier
date, in which case they shall be true and correct as of such earlier date)
and the Underwriters shall have received a certificate of the President or
a Vice President of the Company, dated as of the Closing Date, to such
effect.
(v) On the Closing Date, the Offered Certificates shall be rated (x)
not lower than "AAA" by Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc. and (y) not lower than "Aaa" by Moody's
Investors Service, Inc.
(w) On the Closing Date, the representations and warranties of the
Depositary contained in this Agreement shall be true and correct as if made
on the Closing Date (except to the extent that they relate solely to an
earlier date, in which case they shall be true and correct as of such
earlier date).
(x) You shall have received from Ernst & Young LLP a letter, dated
the Closing Date, which meets the requirements of subsection (r) of this
Section, except that the specified date referred to in such subsection will
be a date not more than three business days prior to the Closing Date for
the purposes of this subsection.
(y) On the Closing Date, the Certificate Purchase Agreement shall
have been duly authorized, executed and delivered by each of the parties
thereto substantially in the form provided to you prior to the execution of
this Agreement or otherwise in a form reasonably satisfactory to you and
shall be in full force and effect and the Class H Certificates and the
Class I Certificates shall, simultaneously with the issuance of the Offered
Certificates, be duly and validly issued in accordance with the terms
thereof.
The Company will furnish the Underwriters with such conformed copies
of such opinions, certificates, letters and documents as the Underwriters
reasonably request.
4. CERTAIN COVENANTS OF THE COMPANY. The Company covenants with each
Underwriter as follows:
(a) During the period described in the following sentence of this
Section 4(a), the Company shall advise you promptly of any proposal to
amend or supplement the Registration Statement or the Prospectus (except by
documents filed under the Exchange Act) and will not effect such amendment
or supplement (except by documents filed under the Exchange Act) without
your consent, which consent will not be unreasonably withheld. If, at any
time after the public offering of the Offered Certificates as the
Prospectus is required by law to be delivered in connection with sales of
the Offered Certificates by an Underwriter or a dealer, any event shall
occur as a result of which it is necessary to amend the Registration
Statement or amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading in any material respect, or if
it is necessary to amend the Registration Statement or amend or supplement
the Prospectus to comply with law, the Company shall prepare and furnish,
at its own expense, to the Underwriters and to the dealers (whose names and
addresses you will furnish to the Company) to which Offered Certificates
may have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Prospectus so
that the statements in the Prospectus as so amended or supplemented will
not, in the light of the circumstances when the Prospectus is delivered to
a purchaser, be misleading in any material respect or amendments or
supplements to the Registration Statement or the Prospectus so that the
Registration Statement or the Prospectus, as so amended or supplemented,
will comply with law and cause such amendments or supplements to be filed
promptly with the Commission.
(b) During the period mentioned in paragraph (a) above, the Company
shall notify each Underwriter immediately of (i) the effectiveness of any
amendment to the Registration Statement (except for documents filed under
the Exchange Act by the Policy Provider), (ii) the transmittal to the
Commission for filing of any supplement to the Prospectus or any document
that would as a result thereof be incorporated by reference in the
Prospectus (except for documents filed under the Exchange Act by the Policy
Provider), (iii) the receipt of any comments from the Commission with
respect to the Registration Statement, the Prospectus or the Prospectus
Supplement, (iv) any request by the Commission to the Company for any
amendment to the Registration Statement or any supplement to the Prospectus
or for additional information relating thereto or to any document
incorporated by reference in the Prospectus and (v) receipt by the Company
of any notice of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement, the suspension
of the qualification of the Offered Certificates for offering or sale in
any jurisdiction, or the institution or threatening of any proceeding for
any of such purposes; and the Company agrees to use every reasonable effort
to prevent the issuance of any such stop order and, if any such order is
issued, to obtain the lifting thereof at the earliest possible moment and
the Company shall (subject to the proviso to Section 4(e)) endeavor, in
cooperation with the Underwriters, to prevent the issuance of any such stop
order suspending such qualification and, if any such order is issued, to
obtain the lifting thereof at the earliest possible moment.
(c) During the period mentioned in paragraph (a) above, the Company
will furnish to each of the Underwriters as many conformed copies of the
Registration Statement (as originally filed) and all amendments and
supplements to such documents (excluding all exhibits and documents filed
therewith or incorporated by reference therein) and as many conformed
copies of all consents and certificates of experts, in each case as soon as
available and in such quantities as each of the Underwriters reasonably
requests.
(d) Promptly following the execution of this Agreement, the Company
will prepare a Prospectus Supplement that complies with the Securities Act
and that sets forth the principal amount of the Offered Certificates and
their terms (including, without limitation, terms of the Escrow Receipts
attached to the Offered Certificates) not otherwise specified in the
Preliminary Prospectus Supplement or the basic prospectus included in the
Registration Statement, the name of each Underwriter and the principal
amount of the Offered Certificates that each severally has agreed to
purchase, the name of each Underwriter, if any, acting as representative of
the Underwriters in connection with the offering, the price at which the
Offered Certificates are to be purchased by the Underwriters from the
Original Trustees, any initial public offering price, any selling
concession and reallowance and any delayed delivery arrangements, and such
other information as you and the Company deem appropriate in connection
with the offering of the Offered Certificates. The Company will timely
transmit copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424 under the Securities Act.
(e) The Company shall, in cooperation with the Underwriters,
endeavor to arrange for the qualification of the Offered Certificates for
offer and sale under the applicable securities or "blue sky" laws of such
jurisdictions in the United States as you reasonably designate and will
endeavor to maintain such qualifications in effect so long as required for
the distribution of the Offered Certificates; PROVIDED that the Company
shall not be required to (i) qualify as a foreign corporation or as a
dealer in securities, (ii) file a general consent to service of process or
(iii) subject itself to taxation in any such state.
(f) During the period of ten years after the Closing Date, the
Company will promptly furnish to each of the Underwriters, upon request,
copies of all Annual Reports on Form 10-K and any definitive proxy
statement of the Company filed with the Commission; PROVIDED THAT providing
a website address at which such Annual Reports and any such definitive
proxy statements may be accessed will satisfy this clause (f).
(g) Between the date of this Agreement and the Closing Date, except
as contemplated by the Certificate Purchase Agreement, the Company shall
not, without your prior written consent, offer, sell, or enter into any
agreement to sell (as public debt securities registered under the
Securities Act (other than the Offered Certificates) or as debt securities
which may be resold in a transaction exempt from the registration
requirements of the Securities Act in reliance on Rule 144A thereunder and
which are marketed through the use of a disclosure document containing
substantially the same information as a prospectus for similar debt
securities registered under the Securities Act), any equipment notes, pass
through certificates, equipment trust certificates or equipment purchase
certificates secured by aircraft owned or leased by the Company (or rights
relating thereto).
5. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Underwriter, and each Person, if any, who
controls such Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by any Underwriter or any such
controlling person in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
the Preliminary Prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon Underwriter Information, Depositary Information or Policy Provider
Information; PROVIDED, HOWEVER, that the foregoing indemnity agreement with
respect to the Preliminary Prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased the Offered Certificates, or to the benefit of any person
controlling such Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of such Offered Certificates to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such losses, claims, damages or liabilities unless such failure to
deliver the Prospectus was a result of noncompliance by the Company with its
delivery requirements set forth in Section 4(a).
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, each of the officers who signed
the Registration Statement and each person, if any, who controls the Company,
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, to the same extent as the foregoing indemnity from the Company
to such Underwriter but only with reference to the Underwriter Information
provided by such Underwriter.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing. The
indemnifying party, upon request of the indemnified party, shall, and the
indemnifying party may elect to, retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and the indemnifying party
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall have
failed to retain counsel as required by the prior sentence to represent the
indemnified party within a reasonable amount of time. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by you in the case
of parties indemnified pursuant to paragraph (a) above and by the Company in the
case of parties indemnified pursuant to paragraph (b) above. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested in writing an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 90
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement, unless such
fees and expenses are being disputed in good faith. The indemnifying party at
any time may, subject to the last sentence of this Section 5(c), settle or
compromise any proceeding described in this paragraph at the expense of the
indemnifying party. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement (i) includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding and (ii) does not include a statement as to, or an admission of,
fault, culpability or a failure to act by or on behalf of an indemnified party.
(d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 5 is required to be made but is unavailable to an
indemnified party or insufficient in respect of any losses, claims, damages or
liabilities, then the applicable indemnifying party under such paragraph, in
lieu of indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, from the offering of the Offered Certificates
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the other hand in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other hand in connection with the offering of the Offered Certificates
shall be deemed to be in the same respective proportions as the proceeds from
the offering of the Offered Certificates received by the Original Trusts (before
deducting expenses) less total underwriting discounts and commissions paid to
the Underwriters by the Company, and the total underwriting discounts and
commissions paid to the Underwriters by the Company, in each case as set forth
on the cover of the Prospectus, bear to the aggregate public offering price of
the Offered Certificates. The relative fault of the Company on the one hand and
of the Underwriters on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or information supplied by any Underwriter,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Underwriters'
respective obligations to contribute pursuant to this Section 5 are several in
proportion to the respective principal amount of Offered Certificates they have
purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 5 were determined by PRO
RATA allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) above. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in paragraph (d) above shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 5, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Offered Certificates
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The indemnity and contribution provisions contained in this
Section 5 and the representations and warranties of the Company contained in
this Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any person controlling the
Company, and (iii) acceptance of and payment for any of the Offered
Certificates. The remedies provided for in this Section 5 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
6. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters
defaults in their obligations to purchase Offered Certificates hereunder and the
aggregate principal amount of the Offered Certificates that such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10% of
the total principal amount of the Offered Certificates, you may make
arrangements satisfactory to the Company for the purchase of such Offered
Certificates by other persons, including any of the non-defaulting Underwriters,
but if no such arrangements are made by the Closing Date, the non-defaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Offered Certificates that such defaulting
Underwriter or Underwriters agreed but failed to purchase. If any Underwriter or
Underwriters so default and the aggregate principal amount of the Offered
Certificates with respect to which such default or defaults occurs exceeds 10%
of the total principal amount of the Offered Certificates and arrangements
satisfactory to you and the Company for purchase of such Offered Certificates by
other persons are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Company, except as provided in Section 5. As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
7. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any termination of this Agreement, any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter, the Company
or any of their respective representatives, officers or directors or any
controlling person and will survive delivery of and payment for the Offered
Certificates. If for any reason the purchase of the Offered Certificates by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 9 and the respective
obligations of the Company and the Underwriters pursuant to Section 5 shall
remain in effect. If the purchase of the Offered Certificates by the
Underwriters is not consummated for any reason other than solely because of the
occurrence of the termination of the Agreement pursuant to Section 6 or 8, the
Company will reimburse the Underwriters for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) reasonably incurred by
them in connection with the offering of such Offered Certificates and comply
with its obligations under Section 9.
8. TERMINATION. This Agreement shall be subject to termination by
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been materially suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange or the National
Association of Securities Dealers, Inc., (ii) trading of any securities of the
Company shall have been suspended on any exchange or in any over-the-counter
market, (iii) a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities, (iv)
there shall have occurred any attack on, outbreak or escalation of hostilities
or act of terrorism involving, the United States, or any change in financial
markets or any calamity or crisis that, in each case, in your judgment, is
material and adverse or (v) any major disruption of settlements of securities or
clearance services in the United States that would materially impair settlement
and clearance with respect to the Offered Certificates and (b) in the case of
any of the events specified in clauses (a)(i) through (v), such event singly or
together with any other such event makes it, in your judgment, impracticable to
market the Offered Certificates on the terms and in the manner contemplated in
the Prospectus.
9. PAYMENT OF EXPENSES. As between the Company and the Underwriters,
the Company shall pay all expenses incidental to the performance of the
Company's obligations under this Agreement, including the following:
(i) expenses incurred in connection with (A) qualifying the Offered
Certificates for offer and sale under the applicable securities or "blue
sky" laws of such jurisdictions in the United States as you reasonably
designate (including filing fees and fees and disbursements of counsel for
the Underwriters in connection therewith), (B) endeavoring to maintain such
qualifications in effect so long as required for the distribution of such
Offered Certificates, (C) the review (if any) of the offering of the
Offered Certificates by the National Association of Securities Dealers,
Inc., (D) the determination of the eligibility of the Offered Certificates
for investment under the laws of such jurisdictions as the Underwriters may
designate and (E) the preparation and distribution of any blue sky or legal
investment memorandum by Underwriters' counsel;
(ii) expenses incurred in connection with the preparation and
distribution to the Underwriters and the dealers (whose names and addresses
the Underwriters will furnish to the Company) to which Offered Certificates
may have been sold by the Underwriters on their behalf and to any other
dealers upon request, either of (A) amendments to the Registration
Statement or amendments or supplements to the Prospectus (excluding Policy
Provider Information) in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
materially misleading or (B) amendments or supplements to the Registration
Statement or the Prospectus (excluding Policy Provider Information) so that
the Registration Statement or the Prospectus, as so amended or
supplemented, will comply with law and the expenses incurred in connection
with causing such amendments or supplements to be filed promptly with the
Commission, all as set forth in Section 4(a) hereof;
(iii) expenses incurred in connection with the preparation, printing
and filing of the Registration Statement (including financial statements
and exhibits), as originally filed and as amended, the Preliminary
Prospectus and the Prospectus and any amendments thereof and supplements
thereto (excluding Policy Provider Information), and the cost of furnishing
copies thereof to the Underwriters;
(iv) expenses incurred in connection with the preparation, printing
and distribution of this Agreement, the Offered Certificates and the
Operative Agreements;
(v) expenses incurred in connection with the delivery of the Offered
Certificates to the Underwriters;
(vi) reasonable fees and disbursements of the counsel and
accountants for the Company;
(vii) to the extent the Company is so required under any Operative
Agreement to which it is a party, the fees and expenses of the Loan
Trustees, the Subordination Agent, the Paying Agents, the Trustees, the
Escrow Agents, the Depositary, the Primary Liquidity Provider, the
Above-Cap Liquidity Provider, the Policy Provider and the reasonable fees
and disbursements of their respective counsel;
(viii) fees charged by rating agencies for rating the Offered
Certificates (including annual surveillance fees related to the Offered
Certificates as long as they are outstanding);
(ix) reasonable fees and disbursements of counsel for the
Underwriters in an amount to be agreed between the Underwriters and the
Company;
(x) all fees and expenses relating to appraisals of the Aircraft;
and
(xi) all other reasonable out-of-pocket expenses incurred by the
Underwriters in connection with the transactions contemplated by this
Agreement.
10. NOTICES. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or sent by facsimile
transmission and confirmed to the Underwriters, c/o Credit Suisse First Boston
Corporation, Eleven Madison Avenue, New York, NY 10010, Attention: Transactions
Advisory Group, facsimile number (212) 325-8278, c/o J.P. Morgan Securities
Inc., 270 Park Avenue, New York, NY 10017, Attention: Transaction Execution
Group, Maria Sramek, facsimile number (212) 834-6702, Merrill Lynch, Pierce,
Fenner & Smith Incorporated, 4 World Financial Center, 27th Floor, New York, NY
10008, Attention: William Susman, facsimile number (212) 449-2760 and c/o
Salomon Smith Barney Inc., 390 Greenwich Street, 4th Floor, New York, New York
10013, Attention: John F. Grier and, if sent to the Company, will be mailed,
delivered or sent by facsimile transmission and confirmed to it at 1600 Smith
Street, HQSEO, Houston, TX 77002, Attention: Treasurer and General Counsel,
facsimile number (713) 324-2447; PROVIDED, HOWEVER, that any notice to an
Underwriter pursuant to Section 5 will be sent by facsimile transmission or
delivered and confirmed to such Underwriter.
11. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 5, and no other person will have any
right or obligation hereunder.
12. REPRESENTATION OF UNDERWRITERS. CSFB may act for the several
Underwriters in connection with this purchase, and any action under this
Agreement taken by CSFB will be binding upon all the Underwriters.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
15. JURISDICTION. Each of the parties hereto agrees that any legal
suit, action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby may be instituted in any U.S. federal or New
York State court in the Borough of Manhattan in the City of New York and each of
the parties hereto hereby irrevocably waives any objection which it may now or
hereafter have to the laying of venue of any such proceeding, and irrevocably
submits to the jurisdiction of such courts, with respect to actions brought
against it as defendant, in any suit, action or proceeding. Each of the parties
to this Agreement agrees that a final judgment in any such suit, action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law in accordance with
applicable law.
16. LIBOR FOR INITIAL INTEREST PERIOD. The interest rate applicable
for the initial Interest Period ending on May 15, 2002 under the Indentures for
the Series G-1 Equipment Notes and the Deposit Agreement for the Class G-1 Trust
shall be LIBOR, determined by CSFB as the rate for deposits in U.S. dollars for
a period of three months which appears on the Telerate Page 3750 as of 11:00
a.m., London time, on March 21, 2002, plus the relevant Applicable Margin (as
defined in the Indentures for the Series G-1 Equipment Notes and the Deposit
Agreement for the Class G-1 Trust).
If the foregoing is in accordance with the Underwriters'
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement among the
Underwriters, the Depositary and the Company in accordance with its terms.
Very truly yours,
CONTINENTAL AIRLINES, INC.
By:
--------------------------------------
Name: Gerald Laderman
Title: Senior Vice President - Finance
The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written
CREDIT SUISSE FIRST BOSTON CORPORATION
J.P. MORGAN SECURITIES INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON SMITH BARNEY INC.
MORGAN STANLEY & CO. INCORPORATED
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By:
----------------------------------
Name:
Title:
By: J.P. MORGAN SECURITIES INC.
By:
----------------------------------
Name:
Title:
By: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
----------------------------------
Name:
Title:
By: SALOMON SMITH BARNEY INC.
By:
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, New York Branch
as Depositary
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
SCHEDULE I
(Pass Through Certificates, Series 2002-1)
CONTINENTAL AIRLINES, INC.
--------------------------
Pass Through Aggregate Final
Certificate Principal Maturity
DESIGNATION AMOUNT INTEREST RATE DATE
- ----------- ------ ------------- ----
2002-1G-1 $134,644,000 LIBOR + 0.45% February 15, 2013
2002-1G-2 $194,522,000 6.563% August 15, 2013
SCHEDULE II
UNDERWRITERS 2002-1G-1 2002-1G-2
------------ --------- ---------
Credit Suisse First Boston Corporation
11 Madison Avenue $26,932,000 $38,906,000
New York, NY 10010
J.P. Morgan Securities Inc.
270 Park Avenue 26,928,000 38,904,000
New York, NY 10017
Merrill Lynch, Pierce, Fenner & Smith 26,928,000 38,904,000
Incorporated
World Financial Center
North Tower, 10th Floor
New York, NY 10281
Salomon Smith Barney Inc. 26,928,000 38,904,000
390 Greenwich Street
New York, NY 10013
Morgan Stanley & Co. Incorporated
1585 Broadway 26,928,000 38,904,000
New York, NY 10036
SCHEDULE III
CONTINENTAL AIRLINES, INC.
Underwriting commission
and other compensation: $3,000,000
Closing date, time and location: March 25, 2002
10:00 A.M.,
New York time
Hughes Hubbard & Reed LLP
One Battery Park Plaza
New York, New York 10004
SCHEDULE IV
(Pass Through Certificates, Series 2002-1)
CONTINENTAL AIRLINES, INC.
--------------------------
Pass Through Aggregate Final
Certificate Principal Maturity
DESIGNATION AMOUNT DATE
- ----------- ------ ----
2002-1H $145,834,000 February 15, 2007
2002-1I $40,000,000 August 15, 2003
[Execution copy]
TRUST SUPPLEMENT No. 2002-1G-1-O
Dated as of March 25, 2002
between
WILMINGTON TRUST COMPANY
as Trustee,
and
CONTINENTAL AIRLINES, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of September 25, 1997
$134,644,000
Continental Airlines Pass Through Trust 2002-1G-1-O
LIBOR + 0.45% Continental Airlines
Pass Through Certificates,
Series 2002-1G-1-O
TABLE OF CONTENTS
PAGE
ARTICLE I THE CERTIFICATES.....................................................2
Section 1.01. The Certificates.........................................2
ARTICLE II DEFINITIONS.........................................................4
Section 2.01. Definitions..............................................4
ARTICLE III CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS.....11
Section 3.01. Statements to Applicable Certificateholders.............11
Section 3.02. Special Payments Account................................12
Section 3.04. Limitation of Liability for Payments....................14
ARTICLE IV DEFAULT............................................................14
Section 4.01. Purchase Rights of Certificateholders...................14
Section 4.02. Amendment of Section 6.05 of the Basic Agreement........18
ARTICLE V THE TRUSTEE.........................................................19
Section 5.01. Delivery of Documents; Delivery Dates...................19
Section 5.02. Withdrawal of Deposits..................................20
Section 5.03. The Trustee.............................................20
Section 5.04. Representations and Warranties of the Trustee...........21
Section 5.05. Trustee Liens...........................................21
ARTICLE VI ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS......................22
Section 6.01. Amendment of Section 5.02 of the Basic Agreement........22
Section 6.02. Supplemental Agreements Without Consent of Applicable
Certificateholders......................................22
Section 6.03. Supplemental Agreements with Consent of Applicable
Certificateholders......................................23
Section 6.04. Consent of Holders of Certificates Issued under Other
Trusts..................................................23
ARTICLE VII TERMINATION OF TRUST..............................................23
Section 7.01. Termination of the Applicable Trust.....................23
ARTICLE VIII MISCELLANEOUS PROVISIONS.........................................25
Section 8.01. Basic Agreement Ratified................................25
SECTION 8.02. GOVERNING LAW...........................................26
Section 8.03. Execution in Counterparts...............................26
Section 8.04. Intention of Parties....................................26
Exhibit A - Form of Certificate
Exhibit B - DTC Letter of Representations
Exhibit C - Form of Assignment and Assumption Agreement
This Trust Supplement No. 2002-1G-1-O, dated as of March 25, 2002
(herein called the "TRUST SUPPLEMENT"), between Continental Airlines, Inc., a
Delaware corporation (the "COMPANY"), and Wilmington Trust Company (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein, capitalized
terms used herein without definition having the respective meanings specified in
the Basic Agreement) which may be issued thereunder, has heretofore been
executed and delivered;
WHEREAS, the Company has obtained commitments from Boeing for the
delivery of certain Aircraft;
WHEREAS, the Company intends to finance the acquisition of each such
Aircraft through separate secured loan transactions, under which the Company
will own such Aircraft (collectively, the "OWNED AIRCRAFT");
WHEREAS, in the case of each Owned Aircraft, the Company will issue
pursuant to an Indenture, on a recourse basis, Equipment Notes to finance a
portion of the purchase price of such Owned Aircraft;
WHEREAS, the Trustee hereby declares the creation of the Continental
Airlines Pass Through Trust 2002-1G-1-O (the "APPLICABLE TRUST") for the benefit
of the Applicable Certificateholders, and the initial Applicable
Certificateholders as the grantors of the Applicable Trust, by their respective
acceptances of the Applicable Certificates, join in the creation of the
Applicable Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Applicable Trust will
evidence fractional undivided interests in the Applicable Trust and will convey
no rights, benefits or interests in respect of any property other than the Trust
Property except for those Certificates to which an Escrow Receipt has been
affixed;
WHEREAS, the Escrow Agent and the Underwriters have
contemporaneously herewith entered into an Escrow Agreement with the Escrow
Paying Agent pursuant to which the Underwriters have delivered to the Escrow
Agent the proceeds from the sale of the Applicable Certificates, to the extent
not used to purchase Equipment Notes on the Issuance Date, and have irrevocably
instructed the Escrow Agent to withdraw and pay funds from such proceeds upon
request and proper certification by the Trustee to purchase Equipment Notes as
the Aircraft are delivered by Boeing under the Aircraft Purchase Agreement from
time to time prior to the Delivery Period Termination Date;
WHEREAS, the Escrow Agent on behalf of the Applicable
Certificateholders has contemporaneously herewith entered into a Deposit
Agreement with the Depositary under which the Deposits referred to therein will
be made and from which it will withdraw funds to allow the Trustee to purchase
Equipment Notes from time to time prior to the Delivery Period Termination Date;
WHEREAS, pursuant to the terms and conditions of the Basic Agreement
as supplemented by this Trust Supplement (the "AGREEMENT") and the NPA, upon the
financing of an Aircraft, the Trustee on behalf of the Applicable Trust, using
funds withdrawn under the Escrow Agreement (or, if financed on the Issuance
Date, using a portion of the proceeds of the sale of the Applicable
Certificates), shall purchase one or more Equipment Notes having the same
interest rate as, and final maturity date not later than the final Regular
Distribution Date of, the Applicable Certificates issued hereunder and shall
hold such Equipment Notes in trust for the benefit of the Applicable
Certificateholders;
WHEREAS, all of the conditions and requirements necessary to make
this Trust Supplement, when duly executed and delivered, a valid, binding and
legal instrument in accordance with its terms and for the purposes herein
expressed, have been done, performed and fulfilled, and the execution and
delivery of this Trust Supplement in the form and with the terms hereof have
been in all respects duly authorized;
WHEREAS, this Trust Supplement is subject to the provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. THE CERTIFICATES. There is hereby created a series of
Certificates to be issued under the Agreement to be distinguished and known as
"Continental Airlines Pass Through Certificates, Series 2002-1G-1-O"
(hereinafter defined as the "APPLICABLE CERTIFICATES"). Each Applicable
Certificate represents a fractional undivided interest in the Applicable Trust
created hereby. The Applicable Certificates shall be the only instruments
evidencing a fractional undivided interest in the Applicable Trust.
The terms and conditions applicable to the Applicable Certificates
are as follows:
(a) The aggregate principal amount of the Applicable Certificates
that shall be authenticated under the Agreement (except for Applicable
Certificates authenticated and delivered under Sections 3.03, 3.04, 3.05
and 3.06 of the Basic Agreement) is $134,644,000.
(b) The Regular Distribution Dates with respect to any payment of
Scheduled Payments means February 15, May 15, August 15 and November 15 of
each year, commencing on May 15, 2002, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been made.
(c) The Special Distribution Dates with respect to the Applicable
Certificates means any Business Day on which a Special Payment is to be
distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow Agreement, the
Trustee shall affix the corresponding Escrow Receipt to each Applicable
Certificate. In any event, any transfer or exchange of any Applicable
Certificate shall also effect a transfer or exchange of the related Escrow
Receipt. Prior to the Final Withdrawal Date, no transfer or exchange of
any Applicable Certificate shall be permitted unless the corresponding
Escrow Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an Escrow
Receipt is attached, each Holder of such an Applicable Certificate
acknowledges and accepts the restrictions on transfer of the Escrow
Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form attached
hereto as Exhibit A. Any Person acquiring or accepting an Applicable
Certificate or an interest therein will, by such acquisition or
acceptance, be deemed to represent and warrant to and for the benefit of
the Company that either (i) the assets of an employee benefit plan subject
to Title I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or of a plan subject to Section 4975 of the Internal
Revenue Code of 1986, as amended (the "CODE"), have not been used to
purchase Applicable Certificates or an interest therein or (ii) the
purchase and holding of Applicable Certificates or an interest therein is
exempt from the prohibited transaction restrictions of ERISA and the Code
pursuant to one or more prohibited transaction statutory or administrative
exemptions.
(ii) The Applicable Certificates shall be Book-Entry Certificates
and shall be subject to the conditions set forth in the Letter of
Representations between the Company and the Clearing Agency attached
hereto as Exhibit B.
(f) The "Participation Agreements" as defined in this Trust
Supplement are the "Note Purchase Agreements" referred to in the Basic
Agreement.
(g) The Applicable Certificates are subject to the Intercreditor
Agreement, the Deposit Agreement and the Escrow Agreement.
(h) The Applicable Certificates are entitled to the benefits of the
Primary Liquidity Facility, the Above-Cap Liquidity Facility and the
Policy.
(i) The Responsible Party is the Company.
(j) The date referred to in clause (i) of the definition of the term
"PTC Event of Default" in the Basic Agreement is the Final Maturity Date.
(k) The "particular sections of the Note Purchase Agreement", for
purposes of clause (3) of Section 7.07 of the Basic Agreement, are Section
8.1 of each Participation Agreement.
(l) The Equipment Notes to be acquired and held in the Applicable
Trust, and the related Aircraft and Note Documents, are described in the
NPA.
ARTICLE II
DEFINITIONS
Section 2.01. DEFINITIONS. For all purposes of the Basic Agreement
as supplemented by this Trust Supplement, the following capitalized terms have
the following meanings (any term used herein which is defined in both this Trust
Supplement and the Basic Agreement shall have the meaning assigned thereto in
this Trust Supplement for purposes of the Basic Agreement as supplemented by
this Trust Supplement):
ABOVE-CAP LIQUIDITY FACILITY: Means, initially, the ISDA Master
Agreement, dated as of March 25, 2002, between the Subordination Agent, as
agent of the Trustee, and the Above-Cap Liquidity Provider, together with
the Schedule and Confirmation attached thereto, relating to the Applicable
Certificates, and, from and after the replacement of such ISDA Master
Agreement pursuant thereto, the replacement above-cap liquidity facility
therefor, if any, in each case, as amended, supplemented or otherwise
modified from time to time in accordance with their respective terms.
ABOVE-CAP LIQUIDITY PROVIDER: Means Merrill Lynch Capital Services,
Inc., a Delaware corporation.
AGREEMENT: Has the meaning specified in the recitals hereto.
AIRCRAFT: Means each of the New Aircraft or Substitute Aircraft in
respect of which a Participation Agreement is to be or is, as the case may
be, entered into in accordance with the NPA (or any substitute aircraft,
including engines therefor, owned by the Company and securing one or more
Equipment Notes).
AIRCRAFT PURCHASE AGREEMENT: Has the meaning specified in the NPA.
APPLICABLE CERTIFICATE: Has the meaning specified in Section 1.01 of
this Trust Supplement.
APPLICABLE CERTIFICATEHOLDER: Means the Person in whose name an
Applicable Certificate is registered on the Register for the Applicable
Certificates.
APPLICABLE DELIVERY DATE: Has the meaning specified in Section
5.01(b) of this Trust Supplement.
APPLICABLE PARTICIPATION AGREEMENT: Has the meaning specified in
Section 5.01(b) of this Trust Supplement.
APPLICABLE TRUST: Has the meaning specified in the recitals hereto.
ASSIGNMENT AND ASSUMPTION AGREEMENT: Means the assignment and
assumption agreement substantially in the form of Exhibit C hereto
executed and delivered in accordance with Section 7.01 of this Trust
Supplement.
BASIC AGREEMENT: Has the meaning specified in the first paragraph of
this Trust Supplement.
BOEING: Means The Boeing Company.
BREAK AMOUNT: Has the meaning specified in the Indentures.
BUSINESS DAY: Means any day other than a Saturday, a Sunday or a day
on which commercial banks are required or authorized to close in Houston,
Texas, New York, New York, or, so long as any Applicable Certificate is
Outstanding, the city and state in which the Trustee, the Subordination
Agent or any Loan Trustee maintains its Corporate Trust Office or receives
and disburses funds, and, if any Series G-1 Equipment Notes (as defined in
the Intercreditor Agreement) or Series H Equipment Notes (as defined in
the Intercreditor Agreement) are outstanding, which is also a day for
trading by and between banks in the London interbank Eurodollar market.
CERTIFICATE: Has the meaning specified in the Intercreditor
Agreement.
CLASS: Has the meaning specified in the Intercreditor Agreement.
CLASS G-1 ABOVE-CAP ACCOUNT: Has the meaning specified in the
Intercreditor Agreement.
COMPANY: Has the meaning specified in the first paragraph of this
Trust Supplement.
CONTROLLING PARTY: Has the meaning specified in the Intercreditor
Agreement.
CUT-OFF DATE: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event occurs.
DELIVERY NOTICE: Has the meaning specified in the NPA.
DELIVERY PERIOD TERMINATION DATE: Means the earlier of (a) August
31, 2002, or, if the Equipment Notes relating to all of the New Aircraft
(or Substitute Aircraft in lieu thereof) have not been purchased by the
Applicable Trust and the Other Trusts on or prior to such date due to any
reason beyond the control of the Company and not occasioned by the
Company's fault or negligence, November 30, 2002 (PROVIDED that, if a
labor strike occurs at Boeing on or prior to either or both of such dates
referred to in this clause (a), such date or dates on or following the
commencement of such strike shall be extended by adding thereto the number
of days that such strike continued in effect), and (b) the date on which
Equipment Notes issued with respect to all of the New Aircraft (or
Substitute Aircraft in lieu thereof) have been purchased by the Applicable
Trust and the Other Trusts in accordance with the NPA.
DEPOSIT AGREEMENT: Means the Deposit Agreement dated as of March 25,
2002 relating to the Applicable Certificates between the Depositary and
the Escrow Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
DEPOSIT BREAK AMOUNT: Has the meaning specified in the NPA.
DEPOSITARY: Means Credit Suisse First Boston, a banking institution
organized under the laws of Switzerland, acting through its New York
branch.
DEPOSITS: Has the meaning specified in the Deposit Agreement.
DISTRIBUTION DATE: Means any Regular Distribution Date or Special
Distribution Date as the context requires.
ESCROW AGENT: Means, initially, Wells Fargo Bank Northwest, National
Association, and any replacement or successor therefor appointed in
accordance with the Escrow Agreement.
ESCROW AGREEMENT: Means the Escrow and Paying Agent Agreement dated
as of March 25, 2002 relating to the Applicable Certificates, among the
Escrow Agent, the Escrow Paying Agent, the Trustee and Underwriters, as
the same may be amended, supplemented or otherwise modified from time to
time in accordance with its terms.
ESCROW PAYING AGENT: Means the Person acting as paying agent under
the Escrow Agreement.
ESCROW RECEIPT: Means the receipt substantially in the form annexed
to the Escrow Agreement representing a fractional undivided interest in
the funds held in escrow thereunder.
FINAL MATURITY DATE: Means February 15, 2013.
FINAL WITHDRAWAL: Has the meaning specified in the Escrow Agreement.
FINAL WITHDRAWAL DATE: Has the meaning specified in the Escrow
Agreement.
FINAL WITHDRAWAL NOTICE: Has the meaning specified in Section 5.02
of this Trust Supplement.
INDENTURE: Means each of the separate trust indentures and mortgages
relating to the Aircraft, each as specified or described in a Delivery
Notice delivered pursuant to the NPA or the related Participation
Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.
INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as
of March 25, 2002 among the Trustee, the Other Trustees, the Above-Cap
Liquidity Provider, the Primary Liquidity Provider, the primary liquidity
provider relating to the Class G-2 Certificates, the Policy Provider and
Wilmington Trust Company, as Subordination Agent and as trustee
thereunder, as amended, supplemented or otherwise modified from time to
time in accordance with its terms.
INVESTORS: Means the Underwriters, together with all subsequent
beneficial owners of the Applicable Certificates.
MAKE-WHOLE AMOUNT: Has the meaning specified in the Indentures.
NEW AIRCRAFT: Has the meaning specified in the NPA.
NOTE DOCUMENTS: Means the Equipment Notes with respect to the
Applicable Certificates and, with respect to any such Equipment Note, the
Indenture and the Participation Agreement relating to such Equipment Note.
NOTICE OF PURCHASE WITHDRAWAL: Has the meaning specified in the
Deposit Agreement.
NPA: Means the Note Purchase Agreement dated as of March 25, 2002
among the Trustee, the Other Trustees, the Company, the Escrow Agent, the
Escrow Paying Agent and the Subordination Agent, providing for, among
other things, the purchase of Equipment Notes by the Trustee on behalf of
the Trust, as the same may be amended, supplemented or otherwise modified
from time to time, in accordance with its terms.
OTHER AGREEMENTS: Means (i) the Basic Agreement as supplemented by
Trust Supplement No. 2002-1G-2-O dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1G-2-O, (ii) the Basic
Agreement as supplemented by Trust Supplement No. 2002-1H-O dated as of
the date hereof relating to Continental Airlines Pass Through Trust
2002-1H-O and (iii) the Basic Agreement as supplemented by Trust
Supplement No. 2002-1I-O dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1I-O.
OTHER TRUSTEES: Means the trustees under the Other Agreements, and
any successor or other trustee appointed as provided therein.
OTHER TRUSTS: Means the Continental Airlines Pass Through Trust
2002-1G-2-O, the Continental Airlines Pass Through Trust 2002-1H-O and the
Continental Airlines Pass Through Trust 2002-1I-O, created by the Other
Agreements.
OWNED AIRCRAFT: Has the meaning specified in the third recital to
this Trust Supplement.
PARTICIPATION AGREEMENT: Means each Participation Agreement to be
entered into, or entered into (as the case may be), by the Trustee
pursuant to the NPA, as the same may be amended, supplemented or otherwise
modified in accordance with its terms.
POLICY: Means, with respect to the Applicable Certificates, Ambac
Certificate Guarantee Insurance Policy No. AB0542BE, together with the
Certificate Guaranty Insurance Policy Endorsement attached thereto, issued
as of the Closing Date, as amended, supplemented or otherwise modified
from time to time in accordance with its terms.
POLICY PROVIDER: Has the meaning specified in the Intercreditor
Agreement.
POLICY PROVIDER AGREEMENT: Has the meaning specified in the
Intercreditor Agreement.
POLICY PROVIDER DEFAULT: Has the meaning specified in the
Intercreditor Agreement.
POOL BALANCE: Means, as of any date, (i) the original aggregate face
amount of the Applicable Certificates less (ii) the aggregate amount of
all payments made as of such date in respect of such Applicable
Certificates or in respect of Deposits other than payments made in respect
of interest or premium, Make-Whole Amount, Deposit Break Amount or Break
Amount thereon or reimbursement of any costs or expenses incurred in
connection therewith. The Pool Balance as of any date shall be computed
after giving effect to any special distribution with respect to unused
Deposits, payment of principal of the Equipment Notes, payments under the
Policy (other than in respect of interest on the Applicable Certificates)
or payment with respect to other Trust Property and the distribution
thereof to be made on that date.
POOL FACTOR: Means, as of any Distribution Date, the quotient
(rounded to the seventh decimal place) computed by dividing (i) the Pool
Balance by (ii) the original aggregate face amount of the Applicable
Certificates. The Pool Factor as of any Distribution Date shall be
computed after giving effect to any special distribution with respect to
unused Deposits, payment of principal of the Equipment Notes, payment
under the Policy (other than in respect of interest on the Applicable
Certificates) or payment with respect to other Trust Property and the
distribution thereof to be made on that date.
PRIMARY LIQUIDITY FACILITY: Means, initially, the Revolving Credit
Agreement dated as of March 25, 2002 relating to the Applicable
Certificates, between the Primary Liquidity Provider and Wilmington Trust
Company, as Subordination Agent, as agent and trustee for the Applicable
Trust, and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement primary liquidity facility
therefor, in each case as amended, supplemented or otherwise modified from
time to time in accordance with their respective terms.
PRIMARY LIQUIDITY PROVIDER: Means, initially, Landesbank
Hessen-Thuringen Girozentrale, a German public law institution duly
established under the Treaty on the Formation of a Joint Savings Banks
Organization Hessen-Thuringen, and any replacements or successors therefor
appointed in accordance with the Intercreditor Agreement.
PROSPECTUS SUPPLEMENT: Means the final Prospectus Supplement dated
March 11, 2002 relating to the offering of the Applicable Certificates and
the Class G-2 Certificates.
RATINGS CONFIRMATION: Has the meaning specified in the Intercreditor
Agreement.
REFERENCE AGENCY AGREEMENT: Has the meaning specified in the NPA.
RELATED PASS THROUGH TRUST AGREEMENT: Means the Basic Agreement as
supplemented by the Trust Supplement No. 2002-1G-1-S dated as of the date
hereof relating to the Continental Airlines Pass Through Trust 2002-1G-1-S
and entered into by the Company and the Trustee, which agreement becomes
effective upon the execution and delivery of the Assignment and Assumption
Agreement pursuant to Section 7.01 of this Trust Supplement.
RELATED TRUST: Means the Continental Pass Through Trust 2002-1G-1-S,
to be formed under the Related Pass Through Trust Agreement.
RELATED TRUSTEE: Means the trustee under the Related Pass Through
Trust Agreement.
SCHEDULED DELIVERY DATE: Has the meaning specified in the NPA.
SCHEDULED PAYMENT: Means, with respect to any Equipment Note, (i)
any payment of principal or interest on such Equipment Note (other than
any such payment which is not in fact received by the Trustee or any
Subordination Agent within five days of the date on which such payment is
scheduled to be made) or (ii) any payment of interest on the Applicable
Certificates with funds drawn under the Primary Liquidity Facility or
withdrawn from the Class G-1 Above-Cap Account or any payment of interest
on or principal of the Applicable Certificates with funds drawn under the
Policy, which payment in any such case represents the installment of
principal on such Equipment Note at the stated maturity of such
installment, the payment of regularly scheduled interest accrued on the
unpaid principal amount of such Equipment Note, or both; PROVIDED,
HOWEVER, that any payment of principal, premium, Make-Whole Amount,
Deposit Break Amount or Break Amount, if any, or interest resulting from
the redemption or purchase of any Equipment Note shall not constitute a
Scheduled Payment.
SPECIAL PAYMENT: Means any payment (other than a Scheduled Payment)
in respect of, or any proceeds of, any Equipment Note, Collateral (as
defined in each Indenture) or Deposit Break Amount.
SUBSTITUTE AIRCRAFT: Has the meaning specified in the NPA.
TRANSFER DATE: Has the meaning specified in Section 7.01 of this
Trust Supplement.
TRIGGERING EVENT: Has the meaning assigned to such term in the
Intercreditor Agreement.
TRUST PROPERTY: Means (i) subject to the Intercreditor Agreement,
the Equipment Notes held as the property of the Applicable Trust, all
monies at any time paid thereon and all monies due and to become due
thereunder, (ii) funds from time to time deposited in the Certificate
Account and the Special Payments Account and, subject to the Intercreditor
Agreement, any proceeds from the sale by the Trustee pursuant to Article
VI of the Basic Agreement of any Equipment Note and (iii) all rights of
the Applicable Trust and the Trustee, on behalf of the Applicable Trust,
under the Intercreditor Agreement, the Escrow Agreement, the NPA, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility and the
Policy, including, without limitation, all rights to receive certain
payments thereunder, and all monies paid to the Trustee on behalf of the
Applicable Trust pursuant to the Intercreditor Agreement, the Above-Cap
Liquidity Facility, the Primary Liquidity Facility or the Policy, PROVIDED
that rights with respect to the Deposits or under the Escrow Agreement,
except for the right to direct withdrawals for the purchase of Equipment
Notes to be held herein, will not constitute Trust Property.
TRUST SUPPLEMENT: Has the meaning specified in the first paragraph
of this trust supplement.
TRUSTEE: Has the meaning specified in the first paragraph of this
Trust Supplement.
UNDERWRITERS: Means, collectively, Credit Suisse First Boston
Corporation, J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Salomon Smith Barney Inc. and Morgan Stanley & Co.
Incorporated.
UNDERWRITING AGREEMENT: Means the Underwriting Agreement dated March
11, 2002 among the Underwriters, the Company and the Depositary, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
ARTICLE III
CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. STATEMENTS TO APPLICABLE CERTIFICATEHOLDERS. (a) On
each Distribution Date, the Trustee will include with each distribution to
Applicable Certificateholders of a Scheduled Payment or Special Payment, as the
case may be, a statement setting forth the information provided below (in the
case of a Special Payment, reflecting in part the information provided by the
Escrow Paying Agent under the Escrow Agreement). Such statement shall set forth
(per $1,000 face amount Applicable Certificate as to (ii), (iii), (iv) and (v)
below) the following information:
(i) the aggregate amount of funds distributed on such Distribution
Date under the Agreement and under the Escrow Agreement, indicating the
amount allocable to each source, including any portion thereof paid by the
Primary Liquidity Provider or the Policy Provider or withdrawn from the
Class G-1 Above-Cap Account;
(ii) the amount of such distribution under the Agreement allocable
to principal and the amount allocable to premium, Make-Whole Amount,
Deposit Break Amount or Break Amount, if any;
(iii) the amount of such distribution under the Agreement allocable
to interest;
(iv) the amount of such distribution under the Escrow Agreement
allocable to interest;
(v) the amount of such distribution under the Escrow Agreement
allocable to unused Deposits, if any;
(vi) the Pool Balance and the Pool Factor; and
(vii) the LIBOR rates and the resulting interest rates payable on
the Applicable Certificates for the current and immediately preceding
Interest Periods.
With respect to the Applicable Certificates registered in the name
of a Clearing Agency, on the Record Date prior to each Distribution Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such Record Date. On each Distribution Date, the Trustee will mail to each such
Clearing Agency Participant the statement described above and will make
available additional copies as requested by such Clearing Agency Participant for
forwarding to holders of interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was an
Applicable Certificateholder of record a statement containing the sum of the
amounts determined pursuant to clauses (a)(i), (a)(ii), (a)(iii), (a)(iv) and
(a)(v) above for such calendar year or, in the event such Person was an
Applicable Certificateholder of record during a portion of such calendar year,
for such portion of such year, and such other items as are readily available to
the Trustee and which an Applicable Certificateholder shall reasonably request
as necessary for the purpose of such Applicable Certificateholder's preparation
of its U.S. federal income tax returns. Such statement and such other items
shall be prepared on the basis of information supplied to the Trustee by the
Clearing Agency Participants and shall be delivered by the Trustee to such
Clearing Agency Participants to be available for forwarding by such Clearing
Agency Participants to the holders of interests in the Applicable Certificates
in the manner described in Section 3.01(a) of this Trust Supplement.
(c) If the aggregate principal payments scheduled for a Regular
Distribution Date prior to the Delivery Period Termination Date differ from the
amount thereof set forth for the Applicable Certificates on page S-42 of the
Prospectus Supplement, by no later than the 15th day prior to such Regular
Distribution Date, the Trustee shall mail written notice of the actual amount of
such scheduled payments to the Applicable Certificateholders of record as of a
date within 15 Business Days prior to the date of mailing.
(d) Promptly following (i) the Delivery Period Termination Date, if
there has been any change in the information set forth in clauses (y) and (z)
below from that set forth in page S-42 of the Prospectus Supplement, and (ii)
the date of any early redemption or purchase of, or any default in the payment
of principal or interest in respect of, any of the Equipment Notes held in the
Applicable Trust, or any Final Withdrawal, the Trustee shall furnish to
Applicable Certificateholders of record on such date a statement setting forth
(x) the expected Pool Balances for each subsequent Regular Distribution Date
following the Delivery Period Termination Date, (y) the related Pool Factors for
such Regular Distribution Dates and (z) the expected principal distribution
schedule of the Equipment Notes, in the aggregate, held as Trust Property at the
date of such notice. With respect to the Applicable Certificates registered in
the name of a Clearing Agency, on the Delivery Period Termination Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such date. The Trustee will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as requested
by such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(e) This Section 3.01 supersedes and replaces Section 4.03 of the
Basic Agreement, with respect to the Applicable Trust.
Section 3.02. SPECIAL PAYMENTS ACCOUNT. (a) The Trustee shall
establish and maintain on behalf of the Applicable Certificateholders a Special
Payments Account as one or more accounts, which shall be non-interest bearing
except as provided in Section 4.04 of the Basic Agreement. The Trustee shall
hold the Special Payments Account in trust for the benefit of the Applicable
Certificateholders and shall make or permit withdrawals therefrom only as
provided in the Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement and upon the payment of
the Deposit Break Amount to the Trustee under the NPA, the Trustee, upon receipt
thereof, shall immediately deposit the aggregate amount of such Special Payments
in the Special Payments Account.
(b) This Section 3.02 supersedes and replaces Section 4.01(b) of the
Basic Agreement in its entirety, with respect to the Applicable Trust.
Section 3.03. DISTRIBUTIONS FROM SPECIAL PAYMENTS ACCOUNT. (a) On
each Special Distribution Date with respect to any Special Payment or as soon
thereafter as the Trustee has confirmed receipt of any Special Payments due on
the Equipment Notes held (subject to the Intercreditor Agreement) in the
Applicable Trust or realized upon the sale of such Equipment Notes or receipt of
the Deposit Break Amount, the Trustee shall distribute out of the Special
Payments Account the entire amount of such Special Payment deposited therein
pursuant to Section 3.02(a) of this Trust Supplement. There shall be so
distributed to each Applicable Certificateholder of record on the Record Date
with respect to such Special Distribution Date (other than as provided in
Section 7.01 of this Trust Supplement concerning the final distribution) by
check mailed to such Applicable Certificateholder, at the address appearing in
the Register, such Applicable Certificateholder's pro rata share (based on the
Fractional Undivided Interest in the Applicable Trust held by such Applicable
Certificateholder) of the total amount in the Special Payments Account on
account of such Special Payment, except that, with respect to Applicable
Certificates registered on the Record Date in the name of a Clearing Agency (or
its nominee), such distribution shall be made by wire transfer in immediately
available funds to the account designated by such Clearing Agency (or such
nominee).
(b) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Applicable Certificateholder at his
address as it appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the Applicable Trust, such notice shall be mailed not
less than 15 days prior to the Special Distribution Date for the Special Payment
resulting from such redemption or purchase, which Special Distribution Date
shall be the date of such redemption or purchase. In the case of any
distribution pursuant to Section 3.7(c) or Section 3.7(e) of the Intercreditor
Agreement, the Trustee will mail notice to the Applicable Certificateholders not
less than 15 days prior to the Special Distribution Date determined for such
distribution. In the event of the payment of a Deposit Break Amount by the
Company to the Trustee under the NPA, such notice shall be mailed, together with
the notice by the Escrow Paying Agent under Section 2.07 of the Escrow
Agreement, not less than 15 days prior to the Special Distribution Date for such
amount. In the case of any other Special Payments, such notice shall be mailed
as soon as practicable after the Trustee has confirmed that it has received
funds for such Special Payment, stating the Special Distribution Date for such
Special Payment which shall occur not less than 15 days after the date of such
notice and as soon as practicable thereafter. Notices mailed by the Trustee
shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 7.01 of this Trust Supplement),
(ii) the amount of the Special Payment for each $1,000 face amount
Applicable Certificate and the amount thereof constituting principal,
premium, Make-Whole Amount, Deposit Break Amount or Break Amount, if any,
and interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date, the total amount to be received on such date for each
$1,000 face amount Applicable Certificate.
If the amount of (i) premium, Make-Whole Amount or Break Amount, if any, payable
upon the redemption or purchase of an Equipment Note or (ii) the Deposit Break
Amount, if any, has not been calculated at the time that the Trustee mails
notice of a Special Payment, it shall be sufficient if the notice sets forth the
other amounts to be distributed and states that any premium, Make-Whole Amount,
Deposit Break Amount or Break Amount received will also be distributed.
If any redemption of the Equipment Notes held in the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Applicable Certificateholder at its address
as it appears on the Register.
(b) This Section 3.03 supersedes and replaces Section 4.02(b) and
Section 4.02(c) of the Basic Agreement in their entirety, with respect to the
Applicable Trust.
Section 3.04. LIMITATION OF LIABILITY FOR PAYMENTS. Section 3.09 of
the Basic Agreement shall be amended, with respect to the Applicable Trust, by
deleting the phrase "the Owner Trustees or the Owner Participants" in the second
sentence thereof and adding in lieu thereof "the Above-Cap Liquidity Provider,
the Primary Liquidity Provider or the Policy Provider".
ARTICLE IV
DEFAULT
Section 4.01. PURCHASE RIGHTS OF CERTIFICATEHOLDERS. (a) At any time
after the occurrence and during the continuation of a Triggering Event, if the
Class G-2 Trustee is then the Controlling Party, each Applicable
Certificateholder (other than the Company or any of its Affiliates) shall have
the right to purchase, for the purchase price set forth in the Class G-2 Trust
Agreement, all, but not less than all, of the Class G-2 Certificates upon ten
days' written notice to the Class G-2 Trustee and each other Applicable
Certificateholder, PROVIDED that (i) if prior to the end of such ten-day period
any other Applicable Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Applicable Certificateholder that such
other Applicable Certificateholder wants to participate in such purchase, then
such other Applicable Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Applicable Certificateholder to
purchase all, but not less than all, of the Class G-2 Certificates pro rata
based on the Fractional Undivided Interest in the Applicable Trust held by each
such Applicable Certificateholder and (ii) if prior to the end of such ten-day
period any other Applicable Certificateholder fails to notify the purchasing
Applicable Certificateholder of such other Applicable Certificateholder's desire
to participate in such a purchase, then such other Applicable Certificateholder
shall lose its right to purchase the Class G-2 Certificates pursuant to this
Section 4.01(a).
(b) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after the occurrence and during the
continuation of a Triggering Event,
(i) if the Trustee is then the Controlling Party, each Class G-2
Certificateholder (other than the Company or any of its Affiliates) shall
have the right to purchase all, but not less than all, of the Applicable
Certificates upon ten days' written notice to the Trustee and each other
Class G-2 Certificateholder, PROVIDED that (A) if prior to the end of such
ten-day period any other Class G-2 Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Class G-2
Certificateholder that such other Class G-2 Certificateholder wants to
participate in such purchase, then such other Class G-2 Certificateholder
(other than the Company or any of its Affiliates) may join with the
purchasing Class G-2 Certificateholder to purchase all, but not less than
all, of the Applicable Certificates pro rata based on the Fractional
Undivided Interest in the Class G-2 Trust held by each such Class G-2
Certificateholder and (B) if prior to the end of such ten-day period any
other Class G-2 Certificateholder fails to notify the purchasing Class G-2
Certificateholder of such other Class G-2 Certificateholder's desire to
participate in such a purchase, then such other Class G-2
Certificateholder shall lose its right to purchase the Applicable
Certificates pursuant to this Section 4.01(b)(i);
(ii) each Class H Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a) or (b)(i)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice
to the Trustee, the Class G-2 Trustee and each other Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Class H Certificateholder (other than the Company or any
of its Affiliates) notifies such purchasing Class H Certificateholder that
such other Class H Certificateholder wants to participate in such
purchase, then such other Class H Certificateholder (other than the
Company or any of its Affiliates) may join with the purchasing Class H
Certificateholder to purchase all, but not less than all, of the
Applicable Certificates and the Class G-2 Certificates pro rata based on
the Fractional Undivided Interest in the Class H Trust held by each such
Class H Certificateholder and (B) if prior to the end of such ten-day
period any other Class H Certificateholder fails to notify the purchasing
Class H Certificateholder of such other Class H Certificateholder's desire
to participate in such a purchase, then such other Class H
Certificateholder shall lose its right to purchase the Applicable
Certificates and the Class G-2 Certificates pursuant to this Section
4.01(b)(ii);
(iii) if Re-Issued Class H Certificates are issued, each Re-Issued
Class H Certificateholder (other than the Company or any of its
Affiliates) shall have the right (which shall not expire upon any purchase
of the Applicable Certificates pursuant to clause (a), (b)(i) or (b)(ii)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice
to the Trustee, the Class G-2 Trustee and each other Re-Issued Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Re-Issued Class H Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Re-Issued Class
H Certificateholder that such other Re-Issued Class H Certificateholder
wants to participate in such purchase, then such other Re-Issued Class H
Certificateholder (other than the Company or any of its Affiliates) may
join with the purchasing Re-Issued Class H Certificateholder to purchase
all, but not less than all, of the Applicable Certificates and the Class
G-2 Certificates pro rata based on the Fractional Undivided Interest in
the Re-Issued Class H Trust held by each such Re-Issued Class H
Certificateholder and (B) if prior to the end of such ten-day period any
other Re-Issued Class H Certificateholder fails to notify the purchasing
Re-Issued Class H Certificateholder of such other Re-Issued Class H
Certificateholder's desire to participate in such a purchase, then such
other Re-Issued Class H Certificateholder shall lose its right to purchase
the Applicable Certificates and the Class G-2 Certificates pursuant to
this Section 4.01(b)(iii);
(iv) each Class I Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii) or (b)(iii) above) to purchase all, but not less than all, of the
Applicable Certificates, the Class G-2 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) upon ten
days' written notice to the Trustee, the Class G-2 Trustee, the Class H
Trustee (or, if any Re-Issued Class H Certificates have been issued, the
Re-Issued Class H Trustee) and each other Class I Certificateholder,
PROVIDED that (A) if prior to the end of such ten-day period any other
Class I Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Class I Certificateholder that such
other Class I Certificateholder wants to participate in such purchase,
then such other Class I Certificateholder (other than the Company or any
of its Affiliates) may join with the purchasing Class I Certificateholder
to purchase all, but not less than all, of the Applicable Certificates,
the Class G-2 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) pro rata based on the Fractional Undivided
Interest in the Class I Trust held by each such Class I Certificateholder
and (B) if prior to the end of such ten-day period any other Class I
Certificateholder fails to notify the purchasing Class I Certificateholder
of such other Class I Certificateholder's desire to participate in such a
purchase, then such other Class I Certificateholder shall lose its right
to purchase the Applicable Certificates, the Class G-2 Certificates, the
Class H Certificates (or, if issued, the Re-Issued Class H Certificates)
pursuant to this Section 4.01(b)(iv); and
(v) each Class J Certificateholder, other than the Company or any of
its Affiliates, shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii), (b)(iii) or (b)(iv) above) to purchase all, but not less than
all, of the Applicable Certificates, the Class G-2 Certificates, the Class
H Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates upon ten days' written notice to the Trustee, the
Class G-2 Trustee, the Class H Trustee (or, if any Re-Issued Class H
Certificates have been issued, the Re-Issued Class H Trustee), the Class I
Trustee and each other Class J Certificateholder, PROVIDED that (A) if
prior to the end of such ten-day period any other Class J
Certificateholder (other than the Company or any of its Affiliates)
notifies such purchasing Class J Certificateholder that such other Class J
Certificateholder wants to participate in such purchase, then such other
Class J Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Class J Certificateholder to
purchase all, but not less than all, of the Applicable Certificates, the
Class G-2 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) and the Class I Certificates pro rata
based on the Fractional Undivided Interest in the Class J Trust held by
each such Class J Certificateholder and (B) if prior to the end of such
ten-day period any other Class J Certificateholder fails to notify the
purchasing Class J Certificateholder of such other Class J
Certificateholder's desire to participate in such a purchase, then such
other Class J Certificateholder shall lose its right to purchase the
Applicable Certificates, the Class G-2 Certificates, the Class H
Certificates, the Re-Issued Class H Certificates (if any) and the Class I
Certificates pursuant to this Section 4.01(b)(v).
(c) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after 180 days have elapsed since the
occurrence of a Triggering Event that is continuing, regardless of whether the
Applicable Certificateholders exercise their right to purchase the Class G-2
Certificates pursuant to Section 4.01(a), the Policy Provider, if it is then the
Controlling Party, shall have the right (except in the event of a Policy
Provider Default) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice to the
Trustee, the Class G-2 Trustee, the Applicable Certificateholders and the Class
G-2 Certificateholders.
The purchase price with respect to the Applicable Certificates shall
be equal to the Pool Balance of the Applicable Certificates, together with
accrued and unpaid interest thereon to the date of such purchase, without
premium, but including any other amounts then due and payable to the Applicable
Certificateholders under the Agreement, the Intercreditor Agreement, the Escrow
Agreement or any Note Document or on or in respect of the Applicable
Certificates; PROVIDED, HOWEVER, that no such purchase of Applicable
Certificates shall be effective unless the purchaser(s) shall certify to the
Trustee that contemporaneously with such purchase, such purchaser(s) is (are)
purchasing, pursuant to the terms of the Agreement and the Other Agreements
(and, if any Re-Issued Class H Certificates have been issued, the pass through
trust agreement relating thereto), (A) in the case of any purchase of the
Applicable Certificates pursuant to clause (b)(i) above, all of the Applicable
Certificates, (B) in the case of any purchase of the Applicable Certificates
pursuant to clause (c) above, all of the Applicable Certificates and the Class
G-2 Certificates, or (C) in all other cases, the Applicable Certificates, the
Class G-2 Certificates, the Class H Certificates (or, if issued, the Re-Issued
Class H Certificates) and the Class I Certificates that are senior to the
securities held by such purchaser(s). Each payment of the purchase price of the
Applicable Certificates referred to in the first sentence hereof shall be made
to an account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01. Each Applicable Certificateholder
agrees by its acceptance of its Applicable Certificate that (at any time after
the occurrence and during the continuation of a Triggering Event) it will, upon
payment from such Class G-2 Certificateholder(s), Class H Certificateholder(s)
(or, if any Re-Issued Class H Certificates have been issued, Re-Issued Class H
Certificateholder(s)), Class I Certificateholder(s), Class J
Certificateholder(s) or the Policy Provider, as the case may be, of the purchase
price set forth in the first sentence of this paragraph, (i) forthwith sell,
assign, transfer and convey to the purchaser(s) thereof (without recourse,
representation or warranty of any kind except for its own acts), all of the
right, title, interest and obligation of such Applicable Certificateholder in
the Agreement, the Escrow Agreement, the Deposit Agreement, the Intercreditor
Agreement, the Above-Cap Liquidity Facility, the Primary Liquidity Facility, the
Policy, the NPA, the Note Documents and all Applicable Certificates and Escrow
Receipts held by such Applicable Certificateholder (excluding all right, title
and interest under any of the foregoing to the extent such right, title or
interest is with respect to an obligation not then due and payable as respects
any action or inaction or state of affairs occurring prior to such sale) (and
the purchaser shall assume all of such Applicable Certificateholder's
obligations under the Agreement, the Escrow Agreement, the Deposit Agreement,
the Intercreditor Agreement, the Above-Cap Liquidity Facility, the Primary
Liquidity Facility, the Policy, the NPA, the Note Documents and all such
Applicable Certificates and Escrow Receipts), (ii) if such purchase occurs after
a record date specified in Section 2.03 of the Escrow Agreement relating to the
distribution of unused Deposits and/or accrued and unpaid interest on Deposits
and prior to or on the related distribution date thereunder, forthwith turn over
to the purchaser(s) of its Applicable Certificate all amounts, if any, received
by it on account of such distribution, and (iii) if such purchase occurs after a
Record Date relating to any distribution and prior to or on the related
Distribution Date, forthwith turn over to the purchaser(s) of its Applicable
Certificate all amounts, if any, received by it on account of such distribution.
The Applicable Certificates will be deemed to be purchased on the date payment
of the purchase price is made notwithstanding the failure of the Applicable
Certificateholders to deliver any Applicable Certificates and, upon such a
purchase, (I) the only rights of the Applicable Certificateholders will be to
deliver the Applicable Certificates to the purchaser(s) and receive the purchase
price for such Applicable Certificates and (II) if the purchaser(s) shall so
request, such Applicable Certificateholder will comply with all the provisions
of Section 3.04 of the Basic Agreement to enable new Applicable Certificates to
be issued to the purchaser in such denominations as it shall request. All
charges and expenses in connection with the issuance of any such new Applicable
Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01 and elsewhere in this Trust Supplement,
the terms "Class G-2 Certificate", "Class G-2 Certificateholder", "Class G-2
Trust", "Class G-2 Trust Agreement", "Class G-2 Trustee", "Class H Certificate",
"Class H Certificateholder", "Class H Trust", "Class H Trustee", "Class I
Certificate", "Class I Certificateholder", "Class I Trust", "Class I Trustee",
"Class J Certificate", "Class J Certificateholder", "Class J Trust", "Re-Issued
Class H Certificate", Re-Issued Class H Certificateholder", "Re-Issued Class H
Trust", and "Re-Issued Class H Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(d) This Section 4.01 supersedes and replaces Section 6.01(b) of the
Basic Agreement, with respect to the Applicable Trust.
Section 4.02. AMENDMENT OF SECTION 6.05 OF THE BASIC AGREEMENT.
Section 6.05 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by deleting the phrase "and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto," set forth in the first sentence thereof.
ARTICLE V
THE TRUSTEE
Section 5.01. DELIVERY OF DOCUMENTS; DELIVERY DATES. (a) The Trustee
is hereby directed (i) to execute and deliver the Intercreditor Agreement, the
Escrow Agreement and the NPA on or prior to the Issuance Date, each in the form
delivered to the Trustee by the Company, and (ii) subject to the respective
terms thereof, to perform its obligations thereunder. Upon request of the
Company and the satisfaction or waiver of the closing conditions specified in
the Underwriting Agreement, the Trustee shall execute, deliver, authenticate,
issue and sell Applicable Certificates in authorized denominations equaling in
the aggregate the amount set forth, with respect to the Applicable Trust, in
Schedule I to the Underwriting Agreement evidencing the entire ownership
interest in the Applicable Trust, which amount equals the maximum aggregate
principal amount of Equipment Notes which may be purchased by the Trustee
pursuant to the NPA. Except as provided in Sections 3.03, 3.04, 3.05 and 3.06 of
the Basic Agreement, the Trustee shall not execute, authenticate or deliver
Applicable Certificates in excess of the aggregate amount specified in this
paragraph. The provisions of this Section 5.01(a) supersede and replace the
first sentence of Section 3.02(a) of the Basic Agreement, with respect to the
Applicable Trust.
(b) On or after the Issuance Date, the Company may deliver from time
to time to the Trustee a Delivery Notice relating to one or more Equipment
Notes. After receipt of a Delivery Notice and in any case no later than one
Business Day prior to a Scheduled Delivery Date as to which such Delivery Notice
relates (the "APPLICABLE DELIVERY DATE"), the Trustee shall (as and when
specified in the Delivery Notice) instruct the Escrow Agent to provide a Notice
of Purchase Withdrawal to the Depositary requesting (A) the withdrawal of one or
more Deposits on the Applicable Delivery Date in accordance with and to the
extent permitted by the terms of the Escrow Agreement and the Deposit Agreement
and (B) the payment of all, or a portion, of such Deposit or Deposits in an
amount equal in the aggregate to the purchase price of such Equipment Notes to
or on behalf of the Company, all as shall be described in the Delivery Notice;
PROVIDED that, if the Issuance Date is an Applicable Delivery Date, the Trustee
shall not so instruct the Escrow Agent, and the purchase price of such Equipment
Notes shall be paid from a portion of the proceeds of the sale of the Applicable
Certificates. The Trustee shall (as and when specified in such Delivery Notice),
subject to the conditions set forth in Section 2 of the NPA, enter into and
perform its obligations under the Participation Agreement specified in such
Delivery Notice (the "APPLICABLE PARTICIPATION AGREEMENT") and cause such
certificates, documents and legal opinions relating to the Trustee to be duly
delivered as required by the Applicable Participation Agreement. If at any time
prior to the Applicable Delivery Date, the Trustee receives a notice of
postponement pursuant to Section 1(e) or 1(f) of the NPA, then the Trustee shall
give the Depositary (with a copy to the Escrow Agent) a notice of cancellation
of such Notice of Purchase Withdrawal relating to such Deposit or Deposits on
such Applicable Delivery Date. Upon satisfaction of the conditions specified in
the NPA and the Applicable Participation Agreement, the Trustee shall purchase
the applicable Equipment Notes with the proceeds of the withdrawals of one or
more Deposits made on the Applicable Delivery Date in accordance with the terms
of the Deposit Agreement and the Escrow Agreement (or, if the Issuance Date is
the Applicable Delivery Date with respect to such Applicable Participation
Agreement, from a portion of the proceeds of the sale of the Applicable
Certificates). The purchase price of such Equipment Notes shall equal the
principal amount of such Equipment Notes. Amounts withdrawn from such Deposit or
Deposits in excess of the purchase price of the Equipment Notes or to the extent
not applied on the Applicable Delivery Date to the purchase price of the
Equipment Notes, shall be re-deposited by the Trustee with the Depositary on the
Applicable Delivery Date in accordance with the terms of the Deposit Agreement.
The provisions of this Section 5.01(b) supersede and replace the provisions of
Section 2.02 of the Basic Agreement with respect to the Applicable Trust, and
all provisions of the Basic Agreement relating to Postponed Notes and Section
2.02 of the Basic Agreement shall not apply to the Applicable Trust.
(c) The Trustee acknowledges its acceptance of all right, title and
interest in and to the Trust Property to be acquired pursuant to Section 5.01(b)
of this Trust Supplement, the NPA and each Applicable Participation Agreement,
and declares that it holds and will hold such right, title and interest for the
benefit of all present and future Applicable Certificateholders, upon the trusts
set forth in the Agreement. By its acceptance of an Applicable Certificate, each
initial Applicable Certificateholder, as a grantor of the Applicable Trust,
joins with the Trustee in the creation of the Applicable Trust. The provisions
of this Section 5.01(c) supersede and replace the provisions of Section 2.03 of
the Basic Agreement, with respect to the Applicable Trust.
Section 5.02. WITHDRAWAL OF DEPOSITS. If any Deposits remain
outstanding on the Business Day next succeeding the Cut-off Date, the Trustee
shall give the Escrow Agent notice that the Trustee's obligation to purchase
Equipment Notes under the NPA has terminated and instruct the Escrow Agent to
provide a notice of Final Withdrawal to the Depositary substantially in the form
of Exhibit B to the Deposit Agreement (the "FINAL WITHDRAWAL NOTICE").
Section 5.03. THE TRUSTEE. (a) Subject to Section 5.04 of this Trust
Supplement and Section 7.15 of the Basic Agreement, the Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Trust Supplement, the Deposit Agreement, the NPA or the
Escrow Agreement or the due execution hereof or thereof by the Company or the
other parties thereto (other than the Trustee), or for or in respect of the
recitals and statements contained herein or therein, all of which recitals and
statements are made solely by the Company, except that the Trustee hereby
represents and warrants that each of this Trust Supplement, the Basic Agreement,
each Applicable Certificate, the Intercreditor Agreement, the NPA and the Escrow
Agreement has been executed and delivered by one of its officers who is duly
authorized to execute and deliver such document on its behalf.
(b) Except as herein otherwise provided and except during the
continuation of an Event of Default in respect of the Applicable Trust created
hereby, no duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this Trust Supplement other
than as set forth in the Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions set
forth in the Agreement, as fully to all intents as if the same were herein set
forth at length.
Section 5.04. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants that:
(a) the Trustee has full power, authority and legal right to
execute, deliver and perform this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is or is to become a party and has taken all necessary action to
authorize the execution, delivery and performance by it of this Trust
Supplement, the Intercreditor Agreement, the Escrow Agreement, the NPA and
the Note Documents to which it is or is to become a party;
(b) the execution, delivery and performance by the Trustee of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is or is to become a party (i) will
not violate any provision of any United States federal law or the law of
the state of the United States where it is located governing the banking
and trust powers of the Trustee or any order, writ, judgment, or decree of
any court, arbitrator or governmental authority applicable to the Trustee
or any of its assets, (ii) will not violate any provision of the articles
of association or by-laws of the Trustee, and (iii) will not violate any
provision of, or constitute, with or without notice or lapse of time, a
default under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the provisions of
any mortgage, indenture, contract, agreement or other undertaking to which
it is a party, which violation, default or lien could reasonably be
expected to have an adverse effect on the Trustee's performance or ability
to perform its duties hereunder or thereunder or on the transactions
contemplated herein or therein;
(c) the execution, delivery and performance by the Trustee of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is or is to become a party will not
require the authorization, consent, or approval of, the giving of notice
to, the filing or registration with, or the taking of any other action in
respect of, any governmental authority or agency of the United States or
the state of the United States where it is located regulating the banking
and corporate trust activities of the Trustee; and
(d) this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement, the NPA and the Note Documents to which it is or is to become a
party have been, or will be, as applicable, duly executed and delivered by
the Trustee and constitute, or will constitute, as applicable, the legal,
valid and binding agreements of the Trustee, enforceable against it in
accordance with their respective terms; PROVIDED, HOWEVER, that
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of
creditors generally and (ii) general principles of equity.
Section 5.05. TRUSTEE LIENS. The Trustee in its individual capacity
agrees, in addition to the agreements contained in Section 7.17 of the Basic
Agreement, that it will at its own cost and expense promptly take any action as
may be necessary to duly discharge and satisfy in full any Trustee's Liens on or
with respect to the Trust Property which is attributable to the Trustee in its
individual capacity and which is unrelated to the transactions contemplated by
the Intercreditor Agreement or the NPA.
ARTICLE VI
ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS
Section 6.01. AMENDMENT OF SECTION 5.02 OF THE BASIC AGREEMENT.
Section 5.02 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by (i) replacing the phrase "of the Note Documents and of this
Agreement" set forth in paragraph (b) thereof with the phrase "of the Note
Documents, of the NPA and of this Agreement" and (ii) replacing the phrase "of
this Agreement and any Note Document" set forth in the last paragraph of Section
5.02 with the phrase "of this Agreement, the NPA and any Note Document".
Section 6.02. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.01 of the Basic Agreement,
under the terms of, and subject to the limitations contained in, Section 9.01 of
the Basic Agreement, the Company may (but will not be required to), and the
Trustee (subject to Section 9.03 of the Basic Agreement) shall, at the Company's
request, at any time and from time to time, (i) enter into one or more
agreements supplemental to the Escrow Agreement, the NPA, the Deposit Agreement,
the Reference Agency Agreement, the Policy or the Policy Provider Agreement for
any of the purposes set forth in clauses (1) through (9) of such Section 9.01,
and (without limitation of the foregoing or Section 9.01 of the Basic Agreement)
(a) the reference in the introductory paragraph of Section 9.01 of the Basic
Agreement to a "Liquidity Facility" shall be deemed to refer to "the Above-Cap
Liquidity Facility and the Primary Liquidity Facility", (b) clauses (2) and (3)
of such Section 9.01 shall also be deemed to include the Company's obligations
under (in the case of clause (2)), and the Company's rights and powers conferred
by (in the case of clause (3)), the NPA, the Reference Agency Agreement, the
Policy or the Policy Provider Agreement, and (c) references in clauses (4), (6)
and (7) of such Section 9.01 to "any Intercreditor Agreement or any Liquidity
Facility" shall also be deemed to refer to "the Intercreditor Agreement, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility, the Escrow
Agreement, the Reference Agency Agreement, the NPA, the Deposit Agreement, the
Policy or the Policy Provider Agreement", (ii) enter into one or more agreements
supplemental to the Agreement, the Intercreditor Agreement, the Reference Agency
Agreement or the NPA to provide for the formation of the Re-Issued Class H
Trust, the issuance of the Re-Issued Class H Certificates, the purchase by the
Re-Issued Class H Trust of Equipment Notes and other matters incidental thereto
or otherwise contemplated by Section 2.01(b) of the Basic Agreement; PROVIDED
that (x) a Ratings Confirmation for the Applicable Certificates and the Class
G-2 Certificates shall have been obtained with respect to such agreements and
(y) the Company shall have certified to the Trustee and to the Other Trustees
that such agreements shall not materially and adversely affect the Applicable
Certificateholders or the Class G-2 Certificateholders and (iii) enter into one
or more agreements supplemental to the Agreement to provide for the formation of
a Class J Trust, the issuance of Class J Certificates, the purchase by the Class
J Trust of Equipment Notes and other matters incidental thereto or otherwise
contemplated by Section 2.01(b) of the Basic Agreement.
Section 6.03. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.02 of the Basic Agreement,
the provisions of Section 9.02 of the Basic Agreement shall apply to agreements
or amendments for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Escrow Agreement, the Deposit
Agreement, the Above-Cap Liquidity Facility, the Primary Liquidity Facility, the
Reference Agency Agreement, the NPA, the Policy or the Policy Provider Agreement
or modifying in any manner the rights and obligations of the Applicable
Certificateholders under the Escrow Agreement, the Deposit Agreement, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility, the Reference
Agency Agreement, the NPA, the Policy or the Policy Provider Agreement; PROVIDED
that the provisions of Section 9.02(1) of the Basic Agreement shall be deemed to
include reductions in any manner of, or delay in the timing of, any receipt by
the Applicable Certificateholders of payments upon the Deposits.
Section 6.04. CONSENT OF HOLDERS OF CERTIFICATES ISSUED UNDER OTHER
TRUSTS. Notwithstanding any provision in Section 6.02 or Section 6.03 of this
Trust Supplement to the contrary, no amendment or modification of Section 4.01
of this Trust Supplement shall be effective unless the trustee for each Class of
Certificates affected by such amendment or modification shall have consented
thereto.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. TERMINATION OF THE APPLICABLE TRUST. (a) The
respective obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the earlier of (A) the
completion of the assignment, transfer and discharge described in the first
sentence of the immediately following paragraph and (B) distribution to all
Applicable Certificateholders and the Trustee of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property; PROVIDED, HOWEVER, that in no event
shall the Applicable Trust continue beyond one hundred ten (110) years following
the date of the execution of this Trust Supplement.
Upon the earlier of (i) the first Business Day following August 31,
2002 or, if later, the fifth Business Day following the Delivery Period
Termination Date and (ii) the fifth Business Day following the date on which a
Triggering Event occurs (such date, the "TRANSFER DATE"), or, if later, the date
on which all of the conditions set forth in the immediately following sentence
have been satisfied, the Trustee is hereby directed (subject only to the
immediately following sentence) to, and the Company shall direct the institution
that will serve as the Related Trustee under the Related Pass Through Trust
Agreement to, execute and deliver the Assignment and Assumption Agreement,
pursuant to which the Trustee shall assign, transfer and deliver all of the
Trustee's right, title and interest to the Trust Property to the Related Trustee
under the Related Pass Through Trust Agreement. The Trustee and the Related
Trustee shall execute and deliver the Assignment and Assumption Agreement upon
the satisfaction of the following conditions:
(i) The Trustee, the Related Trustee and each of the Rating Agencies
then rating the Applicable Certificates shall have received an Officer's
Certificate and an Opinion of Counsel dated the date of the Assignment and
Assumption Agreement and each satisfying the requirements of Section 1.02
of the Basic Agreement, which Opinion of Counsel shall be substantially to
the effect set forth below and may be relied upon by the Beneficiaries (as
defined in the Assignment and Assumption Agreement):
(I) Upon the execution and delivery thereof by the parties thereto
in accordance with the terms of the Agreement and the Related Pass Through
Trust Agreement, the Assignment and Assumption Agreement will constitute
the valid and binding obligation of each of the parties thereto
enforceable against each such party in accordance with its terms;
(II) Upon the execution and delivery of the Assignment and
Assumption Agreement in accordance with the terms of the Agreement and the
Related Pass Through Trust Agreement, each of the Applicable Certificates
then Outstanding will be entitled to the benefits of the Related Pass
Through Trust Agreement;
(III) The Related Trust is not required to be registered as an
investment company under the Investment Company Act of 1940, as amended;
(IV) The Related Pass Through Trust Agreement constitutes the valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms; and
(V) Neither the execution and delivery of the Assignment and
Assumption Agreement in accordance with the terms of the Agreement and the
Related Pass Through Trust Agreement, nor the consummation by the parties
thereto of the transactions contemplated to be consummated thereunder on
the date thereof, will violate any law or governmental rule or regulation
of the State of New York or the United States of America known to such
counsel to be applicable to the transactions contemplated by the
Assignment and Assumption Agreement.
(ii) The Trustee and the Company shall have received (x) a copy of
the articles of incorporation and bylaws of the Related Trustee certified
as of the Transfer Date by the Secretary or Assistant Secretary of such
institution and (y) a copy of the filing (including all attachments
thereto) made by the institution serving as the Related Trustee with the
Office of the Superintendent, State of New York Banking Department for the
qualification of the Related Trustee under Section 131(3) of the New York
Banking Law.
Upon the execution of the Assignment and Assumption Agreement by the parties
thereto, the Applicable Trust shall be terminated, the Applicable
Certificateholders shall receive beneficial interests in the Related Trust in
exchange for their interests in the Applicable Trust equal to their respective
beneficial interests in the Applicable Trust, and the Outstanding Applicable
Certificates representing Fractional Undivided Interests in the Applicable Trust
shall be deemed for all purposes of the Agreement and the Related Pass Through
Trust Agreement, without further signature or action of any party or Applicable
Certificateholder, to be certificates representing the same fractional undivided
interests in the Related Trust and its trust property. By acceptance of its
Applicable Certificate, each Applicable Certificateholder consents to such
assignment, transfer and delivery of the Trust Property to the trustee of the
Related Trust upon the execution and delivery of the Assignment and Assumption
Agreement.
In connection with the occurrence of the event set forth in clause
(B) above, notice of such termination, specifying the Distribution Date upon
which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the 15th day
next preceding such final Distribution Date specifying (A) the Distribution Date
upon which the proposed final payment of the Applicable Certificates will be
made upon presentation and surrender of Applicable Certificates at the office or
agency of the Trustee therein specified, (B) the amount of any such proposed
final payment, and (C) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Applicable Certificates at the office or agency of the
Trustee therein specified. The Trustee shall give such notice to the Registrar
at the time such notice is given to Applicable Certificateholders. Upon
presentation and surrender of the Applicable Certificates in accordance with
such notice, the Trustee shall cause to be distributed to Applicable
Certificateholders such final payments.
In the event that all of the Applicable Certificateholders shall not
surrender their Applicable Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Trustee shall give
a second written notice to the remaining Applicable Certificateholders to
surrender their Applicable Certificates for cancellation and receive the final
distribution with respect thereto. No additional interest shall accrue on the
Applicable Certificates after the Distribution Date specified in the first
written notice. In the event that any money held by the Trustee for the payment
of distributions on the Applicable Certificates shall remain unclaimed for two
years (or such lesser time as the Trustee shall be satisfied, after sixty days'
notice from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money relating
to such Loan Trustee and shall give written notice thereof to the Company.
(b) The provisions of this Section 7.01 supersede and replace the
provisions of Section 11.01 of the Basic Agreement in its entirety, with respect
to the Applicable Trust.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. BASIC AGREEMENT RATIFIED. Except and so far as herein
expressly provided, all of the provisions, terms and conditions of the Basic
Agreement are in all respects ratified and confirmed; and the Basic Agreement
and this Trust Supplement shall be taken, read and construed as one and the same
instrument. All replacements of provisions of, and other modifications of the
Basic Agreement set forth in this Trust Supplement are solely with respect to
the Applicable Trust.
SECTION 8.02. GOVERNING LAW. THE AGREEMENT AND, UNTIL THE TRANSFER
DATE, THE APPLICABLE CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE. THIS SECTION 8.02 SUPERSEDES
AND REPLACES SECTION 12.05 OF THE BASIC AGREEMENT, WITH RESPECT TO THE
APPLICABLE TRUST.
Section 8.03. EXECUTION IN COUNTERPARTS. This Trust Supplement may
be executed in any number of counterparts, each of which shall be an original,
but such counterparts shall together constitute but one and the same instrument.
Section 8.04. INTENTION OF PARTIES. The parties hereto intend that
the Applicable Trust be classified for U.S. federal income tax purposes as a
grantor trust under Subpart E, Part I of Subchapter J of the Internal Revenue
Code of 1986, as amended, and not as a trust or association taxable as a
corporation or as a partnership. Each Applicable Certificateholder and Investor,
by its acceptance of its Applicable Certificate or a beneficial interest
therein, agrees to treat the Applicable Trust as a grantor trust for all U.S.
federal, state and local income tax purposes. The powers granted and obligations
undertaken pursuant to the Agreement shall be so construed so as to further such
intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Trust Supplement to be duly executed by their respective officers thereto duly
authorized, as of the day and year first written above.
CONTINENTAL AIRLINES, INC.
By:
------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
------------------------------------
Name:
Title:
EXHIBIT A
FORM OF CERTIFICATE
Certificate
No. ______
[Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to Issuer or its agent for registration of transfer, exchange or payment, and
any certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any payment is
made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch the registered owner hereof,
Cede & Co., has an interest herein.]
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-1-O
Continental Airlines Pass Through Certificate, Series 2002-1G-1-O
Issuance Date: March 25, 2002
Final Maturity Date: February 15, 2013
Evidencing A Fractional Undivided Interest In The Continental
Airlines Pass Through Trust 2002-1G-1-O, The Property Of
Which Shall Include Certain Equipment Notes Each Secured By
An Aircraft Owned By Continental Airlines, Inc.
$[_____________] Fractional Undivided Interest
representing 0.0007426993% of the Trust per $1,000 face amount
THIS CERTIFIES THAT ____________________, for value received, is the
registered owner of a $___________ (___________________________________________
DOLLARS) Fractional Undivided Interest in the Continental Airlines Pass Through
Trust 2002-1G-1-O (the "TRUST") created by Wilmington Trust Company, as trustee
(the "TRUSTEE"), pursuant to a Pass Through Trust Agreement, dated as of
September 25, 1997 (the "BASIC AGREEMENT"), between the Trustee and Continental
- -----------------
This legend to appear on Book-Entry Certificates to be deposited with the
Depository Trust Company.
Airlines, Inc., a Delaware corporation (the "COMPANY"), as supplemented by Trust
Supplement No. 2002-1G-1-O thereto, dated as of March 25, 2002 (the "TRUST
SUPPLEMENT" and, together with the Basic Agreement, the "AGREEMENT"), between
the Trustee and the Company, a summary of certain of the pertinent provisions of
which is set forth below. To the extent not otherwise defined herein, the
capitalized terms used herein have the meanings assigned to them in the
Agreement. This Certificate is one of the duly authorized Certificates
designated as "Continental Airlines Pass Through Certificates, Series
2002-1G-1-O" (herein called the "CERTIFICATES"). This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement.
By virtue of its acceptance hereof, the holder of this Certificate (the
"CERTIFICATEHOLDER" and, together with all other holders of Certificates issued
by the Trust, the "CERTIFICATEHOLDERS") assents to and agrees to be bound by the
provisions of the Agreement and the Intercreditor Agreement. The property of the
Trust includes certain Equipment Notes and all rights of the Trust to receive
payments under the Intercreditor Agreement, the Policy, the Above-Cap Liquidity
Facility and the Primary Liquidity Facility (the "TRUST PROPERTY"). Each issue
of the Equipment Notes is secured by, among other things, a security interest in
an Aircraft owned by the Company.
The Certificates represent Fractional Undivided Interests in the
Trust and the Trust Property and have no rights, benefits or interest in respect
of any other separate trust established pursuant to the terms of the Basic
Agreement for any other series of certificates issued pursuant thereto.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on February 15, May 15, August 15 and November 15 of each year (a
"REGULAR DISTRIBUTION Date") commencing May 15, 2002, to the Person in whose
name this Certificate is registered at the close of business on the 15th day
preceding the Regular Distribution Date, an amount in respect of the Scheduled
Payments on the Equipment Notes due on such Regular Distribution Date, the
receipt of which has been confirmed by the Trustee, equal to the product of the
percentage interest in the Trust evidenced by this Certificate and an amount
equal to the sum of such Scheduled Payments. Subject to and in accordance with
the terms of the Agreement and the Intercreditor Agreement, in the event that
Special Payments on the Equipment Notes are received by the Trustee, from funds
then available to the Trustee, there shall be distributed on the applicable
Special Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee, equal
to the product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular Distribution Date or Special Distribution Date is not a Business
Day, distribution shall be made on the immediately following Business Day with
the same force and effect as if made on such Regular Distribution Date or
Special Distribution Date and interest shall accrue during the intervening
period. The Trustee shall mail notice of each Special Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.
Distributions on this Certificate will be made by the Trustee by
check mailed to the Person entitled thereto, without presentation or surrender
of this Certificate or the making of any notation hereon, except that with
respect to Certificates registered on the Record Date in the name of a Clearing
Agency (or its nominee), such distribution shall be made by wire transfer.
Except as otherwise provided in the Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after notice mailed by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency of the Trustee specified
in such notice.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company or the Trustee or any
affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement. All payments or
distributions made to Certificateholders under the Agreement shall be made only
from the Trust Property and only to the extent that the Trustee shall have
sufficient income or proceeds from the Trust Property to make such payments in
accordance with the terms of the Agreement. Each Certificateholder of this
Certificate, by its acceptance hereof, agrees that it will look solely to the
income and proceeds from the Trust Property to the extent available for
distribution to such Certificateholder as provided in the Agreement. This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests, rights, benefits,
obligations, privileges, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by any
Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any time
by the Company and the Trustee with the consent of the Certificateholders
holding Certificates evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the Trust. Any such consent by the
Certificateholder of this Certificate shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Certificateholders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the Register
upon surrender of this Certificate for registration of transfer at the offices
or agencies maintained by the Trustee in its capacity as Registrar, or by any
successor Registrar, duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the Certificateholder hereof or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.
Under certain circumstances set forth in Section 7.01 of the Trust
Supplement, all of the Trustee's right, title and interest to the Trust Property
may be assigned, transferred and delivered to the Related Trustee of the Related
Trust pursuant to the Assignment and Assumption Agreement. Upon the
effectiveness of such Assignment and Assumption Agreement (the "TRANSFER"), the
Trust shall be terminated, the Certificateholders shall receive beneficial
interests in the Related Trust in exchange for their interests in the Trust
equal to their respective beneficial interests in the Trust, the Certificates
representing Fractional Undivided Interests in the Trust shall be deemed for all
purposes of the Agreement and the Related Pass Through Trust Agreement to be
certificates representing the same fractional undivided interests in the Related
Trust and its trust property. Each Certificateholder, by its acceptance of this
Certificate or a beneficial interest herein, agrees to be bound by the
Assignment and Assumption Agreement and subject to the terms of the Related Pass
Through Trust Agreement as a Certificateholder thereunder. From and after the
Transfer, unless and to the extent the context otherwise requires, references
herein to the Trust, the Agreement and the Trustee shall constitute references
to the Related Trust, the Related Pass Through Trust Agreement and trustee of
the Related Trust, respectively.
The Certificates are issuable only as registered Certificates
without coupons in minimum denominations of $1,000 Fractional Undivided Interest
and integral multiples thereof, except that one Certificate may be issued in a
different denomination. As provided in the Agreement and subject to certain
limitations therein set forth, the Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.
Each Certificateholder and Investor, by its acceptance of this
Certificate or a beneficial interest herein, agrees to treat the Trust as a
grantor trust for all U.S. federal, state and local income tax purposes.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Trustee, the Registrar, nor
any such agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and
the Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Agreement and the disposition of all property held as part of the Trust
Property.
Any Person acquiring or accepting this Certificate or an interest
herein will, by such acquisition or acceptance, be deemed to have represented
and warranted to and for the benefit of the Company that either: (i) the assets
of an employee benefit plan subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975
of the Internal Revenue Code of 1986, as amended (the "CODE"), have not been
used to purchase this Certificate or an interest herein or (ii) the purchase and
holding of this Certificate or an interest herein are exempt from the prohibited
transaction restrictions of ERISA and the Code pursuant to one or more
prohibited transaction statutory or administrative exemptions.
THE AGREEMENT AND, UNTIL THE TRANSFER, THIS CERTIFICATE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS. THE RELATED PASS THROUGH TRUST
AGREEMENT AND, FROM AND AFTER THE TRANSFER, THIS CERTIFICATE SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
CONTINENTAL AIRLINES PASS THROUGH TRUST
2002-1G-1-O
By: WILMINGTON TRUST COMPANY,
as Trustee
By:
------------------------------------
Name:
Title:
FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
WILMINGTON TRUST COMPANY,
as Trustee
By:
--------------------------------
Name:
Title:
EXHIBIT B
[DTC Letter of Representations]
EXHIBIT C
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
Continental Airlines Pass Through Trust 2002-1G-1-O
ASSIGNMENT AND ASSUMPTION AGREEMENT (2002-1G-1), dated ________ __,
____ (the "ASSIGNMENT AGREEMENT"), between Wilmington Trust Company, a Delaware
banking corporation ("WTC"), not in its individual capacity except as expressly
provided herein, but solely as trustee under the Pass Through Trust Agreement
dated as of September 25, 1997 (as amended or modified from time to time, the
"BASIC AGREEMENT"), as supplemented by the Trust Supplement No. 2002-1G-1-O
dated as of March 25, 2002 (the "TRUST SUPPLEMENT" and together with the Basic
Agreement, the "AGREEMENT") in respect of the Continental Airlines Pass Through
Trust 2002-1G-1-O (the "ASSIGNOR"), and Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity except as expressly provided
herein, but solely as trustee under the Basic Agreement as supplemented by the
Trust Supplement No. 2002-1G-1-S dated as of March 25, 2002 (the "NEW
SUPPLEMENT", and, together with the Basic Agreement, the "NEW AGREEMENT") in
respect of the Continental Airlines Pass Through Trust 2002-1G-1-S (the
"ASSIGNEE").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to effect on the date hereof (the
"TRANSFER DATE") (a) the transfer by the Assignor to the Assignee of all of the
right, title and interest of the Assignor in, under and with respect to, among
other things, the Trust Property and each of the documents listed in Schedule I
hereto (the "SCHEDULED DOCUMENTS") and (b) the assumption by the Assignee of the
obligations of the Assignor (i) under the Scheduled Documents and (ii) in
respect of the Applicable Certificates issued under the Agreement; and
WHEREAS, the Scheduled Documents permit such transfer upon
satisfaction of certain conditions heretofore or concurrently herewith being
complied with;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto do hereby agree as
follows (capitalized terms used herein without definition having the meaning
ascribed thereto in the Agreement):
1. ASSIGNMENT. The Assignor does hereby sell, assign, convey,
transfer and set over unto the Assignee as of the Transfer Date all of its
present and future right, title and interest in, under and with respect to the
Trust Property and the Scheduled Documents and each other contract, agreement,
document or instrument relating to the Trust Property or the Scheduled Documents
(such other contracts, agreements, documents or instruments, together with the
Scheduled Documents, to be referred to as the "ASSIGNED DOCUMENTS"), and any
proceeds therefrom, together with all documents and instruments evidencing any
of such right, title and interest.
2. ASSUMPTION. The Assignee hereby assumes for the benefit of the
Assignor and each of the parties listed in Schedule II hereto (collectively, the
"BENEFICIARIES") all of the duties and obligations of the Assignor, whenever
accrued, pursuant to the Assigned Documents and hereby confirms that it shall be
deemed a party to each of the Assigned Documents to which the Assignor is a
party and shall be bound by all the terms thereof (including the agreements and
obligations of the Assignor set forth therein) as if therein named as the
Assignor. Further, the Assignee hereby assumes for the benefit of the Assignor
and the Beneficiaries all of the duties and obligations of the Assignor under
the Outstanding Applicable Certificates and hereby confirms that the Applicable
Certificates representing Fractional Undivided Interests under the Agreement
shall be deemed for all purposes of the Agreement and the New Agreement to be
certificates representing the same fractional undivided interests under the New
Agreement equal to their respective beneficial interests in the trust created
under the Agreement.
3. EFFECTIVENESS. This Assignment Agreement shall be effective upon
the execution and delivery hereof by the parties hereto, and each Applicable
Certificateholder, by its acceptance of its Applicable Certificate or a
beneficial interest therein, agrees to be bound by the terms of this Assignment
Agreement.
4. PAYMENTS. The Assignor hereby covenants and agrees to pay over to
the Assignee, if and when received following the Transfer Date, any amounts
(including any sums payable as interest in respect thereof) paid to or for the
benefit of the Assignor that, under Section 1 hereof, belong to the Assignee.
5. FURTHER ASSURANCES. The Assignor shall, at any time and from time
to time, upon the request of the Assignee, promptly and duly execute and deliver
any and all such further instruments and documents and take such further action
as the Assignee may reasonably request to obtain the full benefits of this
Assignment Agreement and of the rights and powers herein granted. The Assignor
agrees to deliver any Applicable Certificates, and all Trust Property, if any,
then in the physical possession of the Assignor, to the Assignee.
6. REPRESENTATIONS AND WARRANTIES. (a) The Assignee represents and
warrants to the Assignor and each of the Beneficiaries that:
(i) it has all requisite power and authority and legal right to
enter into and carry out the transactions contemplated hereby and to carry
out and perform the obligations of the "Pass Through Trustee" under the
Assigned Documents;
(ii) on and as of the date hereof, the representations and
warranties of the Assignee set forth in Section 7.15 of the Basic
Agreement and Section 5.04 of the New Supplement are true and correct.
(b) The Assignor represents and warrants to the Assignee that:
(i) it is duly incorporated, validly existing and in good standing
under the laws of the State of Delaware and has the full trust power,
authority and legal right under the laws of the State of Delaware and the
United States pertaining to its trust and fiduciary powers to execute and
deliver this Assignment Agreement;
(ii) the execution and delivery by it of this Assignment Agreement
and the performance by it of its obligations hereunder have been duly
authorized by it and will not violate its articles of association or
by-laws or the provisions of any indenture, mortgage, contract or other
agreement to which it is a party or by which it is bound; and
(iii) this Assignment Agreement constitutes the legal, valid and
binding obligations of it enforceable against it in accordance with its
terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and by general principles of equity, whether
considered in a proceeding at law or in equity.
7. GOVERNING LAW. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING MATTERS
OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
8. COUNTERPARTS. This Assignment Agreement may be executed in any
number of counterparts, all of which together shall constitute a single
instrument. It shall not be necessary that any counterpart be signed by both
parties so long as each party shall sign at least one counterpart.
9. THIRD PARTY BENEFICIARIES. The Assignee hereby agrees, for the
benefit of the Beneficiaries, that its representations, warranties and covenants
contained herein are also intended to be for the benefit of each Beneficiary,
and each Beneficiary shall be deemed to be an express third party beneficiary
with respect thereto, entitled to enforce directly and in its own name any
rights or claims it may have against such party as such beneficiary.
IN WITNESS WHEREOF, the parties hereto, through their respective
officers thereunto duly authorized, have duly executed this Assignment Agreement
as of the day and year first above written.
ASSIGNOR:
WILMINGTON TRUST COMPANY, not in
its individual capacity except as
expressly provided herein, but
solely as trustee under the Pass
Through Trust Agreement and Trust
Supplement in respect of the
Continental Airlines Pass Through
Trust 2002-1G-1-O
By:
------------------------------------
Title:
ASSIGNEE:
WILMINGTON TRUST COMPANY, not in
its individual capacity except as
expressly provided herein, but
solely as trustee under the Pass
Through Trust Agreement and Trust
Supplement in respect of the
Continental Airlines Pass Through
Trust 2002-1G-1-S
By:
------------------------------------
Title:
Schedule I
Schedule of Assigned Documents
(1) Intercreditor Agreement dated as of March 25, 2002 among the
Trustee, the Other Trustees, the Above-Cap Liquidity Provider, the Primary
Liquidity Provider, the primary liquidity provider relating to the Class G-2
Certificates, the Policy Provider and the Subordination Agent.
(2) Escrow and Paying Agent Agreement (Class G-1) dated as of March
25, 2002 among the Escrow Agent, the Underwriters, the Trustee and the Paying
Agent.
(3) Note Purchase Agreement dated as of March 25, 2002 among the
Company, the Trustee, the Other Trustees, the Depositary, the Escrow Agent, the
Paying Agent and the Subordination Agent.
(4) Deposit Agreement (Class G-1) dated as of March 25, 2002 between
the Escrow Agent and the Depositary.
(5) Each of the Operative Agreements (as defined in the
Participation Agreement for each Aircraft) in effect as of the Transfer Date.
Schedule II
Schedule of Beneficiaries
Wilmington Trust Company, not in its individual capacity but solely as
Subordination Agent
Wilmington Trust Company, not in its individual capacity but solely as Paying
Agent
Landesbank Hessen-Thuringen Girozentrale, as Primary Liquidity Provider
Merrill Lynch Capital Services, Inc., as Above-Cap Liquidity Provider
Merrill Lynch & Co., Inc., as Above-Cap Liquidity Guarantor
Ambac Assurance Corporation, as Policy Provider
Credit Suisse First Boston, New York Branch, as Depositary
Continental Airlines, Inc.
Credit Suisse First Boston Corporation, as Underwriter
J.P. Morgan Securities Inc., as Underwriter
Merrill Lynch, Pierce, Fenner & Smith, as Underwriter
Salomon Smith Barney Inc., as Underwriter
Morgan Stanley & Co. Incorporated, as Underwriter
Wells Fargo Bank Northwest, National Association, as Escrow Agent
Each of the other parties to the Assigned Documents
[Execution copy]
TRUST SUPPLEMENT No. 2002-1G-1-S
Dated as of March 25, 2002
between
WILMINGTON TRUST COMPANY
as Trustee,
and
CONTINENTAL AIRLINES, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of September 25, 1997
$134,644,000
Continental Airlines Pass Through Trust 2002-1G-1-S
LIBOR + 0.45% Continental Airlines
Pass Through Certificates,
Series 2002-1G-1-S
TABLE OF CONTENTS
PAGE
ARTICLE I THE CERTIFICATES.....................................................2
Section 1.01. The Certificates....................................2
ARTICLE II DEFINITIONS.........................................................4
Section 2.01. Definitions.........................................4
ARTICLE III DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS...................11
Section 3.01. Statements to Applicable Certificateholders........11
Section 3.02. Special Payments Account...........................13
Section 3.03. Distributions from Special Payments Account........13
Section 3.04. Limitation of Liability for Payments...............14
ARTICLE IV DEFAULT............................................................15
Section 4.01. Purchase Rights of Certificateholders..............15
Section 4.02. Amendment of Section 6.05 of the Basic Agreement...19
ARTICLE V THE TRUSTEE.........................................................19
Section 5.01. Acquisition of Trust Property......................19
Section 5.02. [Intentionally Omitted]............................20
Section 5.03. The Trustee........................................20
Section 5.04. Representations and Warranties of the Trustee......20
Section 5.05. Trustee Liens......................................21
ARTICLE VI ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS......................22
Section 6.01. Amendment of Section 5.02 of the Basic Agreement...22
Section 6.02. Supplemental Agreements Without Consent of
Applicable Certificateholders......................22
Section 6.03. Supplemental Agreements with Consent of
Applicable Certificateholders......................23
Section 6.04. Consent of Holders of Certificates Issued
under Other Trusts.................................23
ARTICLE VII TERMINATION OF TRUST..............................................23
Section 7.01. Termination of the Applicable Trust................23
ARTICLE VIII MISCELLANEOUS PROVISIONS.........................................24
Section 8.01. Basic Agreement Ratified...........................24
Section 8.02. GOVERNING LAW......................................24
Section 8.03. Execution in Counterparts..........................24
Section 8.04. Intention of Parties...............................24
This Trust Supplement No. 2002-1G-1-S, dated as of March 25, 2002
(herein called the "TRUST SUPPLEMENT"), between Continental Airlines, Inc., a
Delaware corporation (the "COMPANY"), and Wilmington Trust Company (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein, capitalized
terms used herein without definition having the respective meanings specified in
the Basic Agreement) which may be issued thereunder, has heretofore been
executed and delivered;
WHEREAS, the Company has obtained commitments from Boeing for the
delivery of certain Aircraft;
WHEREAS, as of the Transfer Date (as defined below), the Company
will have financed the acquisition of all or a portion of such Aircraft through
separate secured loan transactions, under which the Company owns such Aircraft
(collectively, the "OWNED AIRCRAFT");
WHEREAS, as of the Transfer Date, in the case of each Owned
Aircraft, the Company will have issued pursuant to an Indenture, on a recourse
basis, Equipment Notes to finance a portion of the purchase price of such Owned
Aircraft;
WHEREAS, as of the Transfer Date, the Related Trustee will assign,
transfer and deliver all of such trustee's right, title and interest to the
trust property held by the Related Trustee to the Trustee pursuant to the
Assignment and Assumption Agreement (as defined below);
WHEREAS, the Trustee, effective only, but automatically, upon
execution and delivery of the Assignment and Assumption Agreement, will be
deemed to have declared the creation of the Continental Airlines Pass Through
Trust 2002-1G-1-S (the "APPLICABLE TRUST") for the benefit of the Applicable
Certificateholders, and each Holder of Applicable Certificates outstanding as of
the Transfer Date, as the grantors of the Applicable Trust, by their respective
acceptances of such Applicable Certificates, will join in the creation of the
Applicable Trust with the Trustee;
WHEREAS, all Applicable Certificates (as defined below) deemed
issued by the Applicable Trust will evidence fractional undivided interests in
the Applicable Trust and will convey no rights, benefits or interests in respect
of any property other than the Trust Property except for those Applicable
Certificates to which an Escrow Receipt (as defined below) has been affixed;
WHEREAS, upon the execution and delivery of the Assignment and
Assumption Agreement, all of the conditions and requirements necessary to make
this Trust Supplement, when duly executed and delivered, a valid, binding and
legal instrument in accordance with its terms and for the purposes herein
expressed, have been done, performed and fulfilled, and the execution and
delivery of this Trust Supplement in the form and with the terms hereof have
been in all respects duly authorized;
WHEREAS, this Trust Supplement is subject to the provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. THE CERTIFICATES. The Applicable Certificates shall be
known as "Continental Airlines Pass Through Certificates, Series 2002-1G-1-S".
Each Applicable Certificate represents a fractional undivided interest in the
Applicable Trust created hereby. The Applicable Certificates shall be the only
instruments evidencing a fractional undivided interest in the Applicable Trust.
The terms and conditions applicable to the Applicable Certificates
are as follows:
(a) The aggregate principal amount of the Applicable Certificates
that shall be initially deemed issued under the Agreement shall be equal
to the aggregate principal amount of "Outstanding" pass through
certificates representing fractional undivided interests in the Related
Trust on the Transfer Date. Subject to the preceding sentence and Section
5.01 of this Trust Supplement and except for Applicable Certificates
authenticated and delivered under Sections 3.03, 3.04, 3.05 and 3.06 of
the Basic Agreement, no Applicable Certificates shall be authenticated
under the Agreement.
(b) The Regular Distribution Dates with respect to any payment of
Scheduled Payments means February 15, May 15, August 15 and November 15 of
each year, commencing on May 15, 2002, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been made.
(c) The Special Distribution Dates with respect to the Applicable
Certificates means any Business Day on which a Special Payment is to be
distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow Agreement, the
Trustee shall affix the corresponding Escrow Receipt to each Applicable
Certificate. In any event, any transfer or exchange of any Applicable
Certificate shall also effect a transfer or exchange of the related Escrow
Receipt. Prior to the Final Withdrawal Date, no transfer or exchange of
any Applicable Certificate shall be permitted unless the corresponding
Escrow Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an Escrow
Receipt is attached, each Holder of such an Applicable Certificate
acknowledges and accepts the restrictions on transfer of the Escrow
Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form attached as
Exhibit A to the Related Pass Through Trust Supplement, with such
appropriate insertions, omissions, substitutions and other variations as
are required or permitted by the Related Pass Through Trust Agreement or
the Agreement, as the case may be, or as the Trustee may deem appropriate,
to reflect the fact that the Applicable Certificates are being issued
under the Agreement as opposed to under the Related Pass Through Trust
Agreement. Any Person acquiring or accepting an Applicable Certificate or
an interest therein will, by such acquisition or acceptance, be deemed to
represent and warrant to and for the benefit of the Company that either
(i) the assets of an employee benefit plan subject to Title I of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
of a plan subject to Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code"), have not been used to purchase Applicable
Certificates or an interest therein or (ii) the purchase and holding of
Applicable Certificates or an interest therein is exempt from the
prohibited transaction restrictions of ERISA and the Code pursuant to one
or more prohibited transaction statutory or administrative exemptions.
(ii) The Applicable Certificates shall be Book-Entry
Certificates and shall be subject to the conditions set forth in the
Letter of Representations between the Company and the Clearing Agency
attached as Exhibit B to the Related Pass Through Trust Supplement.
(f) The "Participation Agreements" as defined in this Trust
Supplement are the "Note Purchase Agreements" referred to in the Basic
Agreement.
(g) The Applicable Certificates are subject to the Intercreditor
Agreement, the Deposit Agreement and the Escrow Agreement.
(h) The Applicable Certificates are entitled to the benefits of the
Primary Liquidity Facility, the Above-Cap Liquidity Facility and the
Policy.
(i) The Responsible Party is the Company.
(j) The date referred to in clause (i) of the definition of the term
"PTC Event of Default" in the Basic Agreement is the Final Maturity Date.
(k) The "particular sections of the Note Purchase Agreement", for
purposes of clause (3) of Section 7.07 of the Basic Agreement, are Section
8.1 of each Participation Agreement.
(l) The Equipment Notes to be acquired and held in the Applicable
Trust, and the related Aircraft and Note Documents, are described in the
NPA.
ARTICLE II
DEFINITIONS
Section 2.01. DEFINITIONS. For all purposes of the Basic Agreement
as supplemented by this Trust Supplement, the following capitalized terms have
the following meanings (any term used herein which is defined in both this Trust
Supplement and the Basic Agreement shall have the meaning assigned thereto in
this Trust Supplement for purposes of the Basic Agreement as supplemented by
this Trust Supplement):
ABOVE-CAP LIQUIDITY FACILITY: Means, initially, the ISDA Master
Agreement, dated as of March 25, 2002, between the Subordination Agent, as
agent of the Trustee, and the Above-Cap Liquidity Provider, together with
the Schedule and Confirmation attached thereto, relating to the Applicable
Certificates, and, from and after the replacement of such ISDA Master
Agreement pursuant thereto, the replacement above-cap liquidity facility
therefor, if any, in each case, as amended, supplemented or otherwise
modified from time to time in accordance with their respective terms.
ABOVE-CAP LIQUIDITY PROVIDER: Means Merrill Lynch Capital Services,
Inc., a Delaware corporation.
AGREEMENT: Means the Basic Agreement, as supplemented by this Trust
Supplement.
AIRCRAFT: Means each of the New Aircraft or Substitute Aircraft in
respect of which a Participation Agreement is entered into in accordance
with the NPA (or any substitute aircraft, including engines therefor,
owned by the Company and securing one or more Equipment Notes).
AIRCRAFT PURCHASE AGREEMENT: Has the meaning specified in the NPA.
APPLICABLE CERTIFICATE: Means any of the "Applicable Certificates"
issued by the Related Trust and that are "Outstanding" (as defined in the
Related Pass Through Trust Agreement) as of the Transfer Date (the
"TRANSFER DATE CERTIFICATES") and any Certificate issued in exchange
therefor or replacement thereof pursuant to the Agreement.
APPLICABLE CERTIFICATEHOLDER: Means the Person in whose name an
Applicable Certificate is registered on the Register for the Applicable
Certificates.
APPLICABLE TRUST: Has the meaning specified in the recitals hereto.
ASSIGNMENT AND ASSUMPTION AGREEMENT: Means the assignment and
assumption agreement substantially in the form of Exhibit C to the Related
Pass Through Trust Supplement executed and delivered in accordance with
Section 7.01 of the Related Trust Supplement.
BASIC AGREEMENT: Has the meaning specified in the first paragraph of
this Trust Supplement.
BOEING: Means The Boeing Company.
BREAK AMOUNT: Has the meaning specified in the Indentures.
BUSINESS DAY: Means any day other than a Saturday, a Sunday or a day
on which commercial banks are required or authorized to close in Houston,
Texas, New York, New York, or, so long as any Applicable Certificate is
Outstanding, the city and state in which the Trustee, the Subordination
Agent or any Loan Trustee maintains its Corporate Trust Office or receives
and disburses funds and, if any Series G-1 Equipment Notes (as defined in
the Intercreditor Agreement) or Series H Equipment Notes (as defined in
the Intercreditor Agreement) are outstanding, which is also a day for
trading by and between banks in the London interbank Eurodollar market.
CERTIFICATE: Has the meaning specified in the Intercreditor
Agreement.
CLASS: Has the meaning specified in the Intercreditor Agreement.
CLASS G-1 ABOVE-CAP ACCOUNT: Has the meaning specified in the
Intercreditor Agreement.
COMPANY: Has the meaning specified in the first paragraph of this
Trust Supplement.
CONTROLLING PARTY: Has the meaning specified in the Intercreditor
Agreement.
CUT-OFF DATE: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event occurs.
DELIVERY NOTICE: Has the meaning specified in the NPA.
DELIVERY PERIOD TERMINATION DATE: Has the meaning specified in the
Related Pass Through Trust Supplement.
DEPOSIT AGREEMENT: Means the Deposit Agreement dated as of March 25,
2002, relating to the Applicable Certificates between the Depositary and
the Escrow Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
DEPOSIT BREAK AMOUNT: Has the meaning specified in the NPA.
DEPOSITARY: Means Credit Suisse First Boston, a banking institution
organized under the laws of Switzerland, acting through its New York
branch.
DEPOSITS: Has the meaning specified in the Deposit Agreement.
DISTRIBUTION DATE: Means any Regular Distribution Date or Special
Distribution Date as the context requires.
ESCROW AGENT: Means, initially, Wells Fargo Bank Northwest, National
Association, and any replacement or successor therefor appointed in
accordance with the Escrow Agreement.
ESCROW AGREEMENT: Means the Escrow and Paying Agent Agreement dated
as of March 25, 2002 relating to the Applicable Certificates, among the
Escrow Agent, the Escrow Paying Agent, the Related Trustee (and after the
Transfer Date, the Trustee) and the Underwriters, as the same may be
amended, supplemented or otherwise modified from time to time in
accordance with its terms.
ESCROW PAYING AGENT: Means the Person acting as paying agent under
the Escrow Agreement.
ESCROW RECEIPT: Means the receipt substantially in the form annexed
to the Escrow Agreement representing a fractional undivided interest in
the funds held in escrow thereunder.
FINAL MATURITY DATE: Means February 15, 2013.
FINAL WITHDRAWAL: Has the meaning specified in the Escrow Agreement.
FINAL WITHDRAWAL DATE: Has the meaning specified in the Escrow
Agreement.
INDENTURE: Means each of the separate trust indentures and mortgages
relating to the Aircraft, each as specified or described in a Delivery
Notice delivered pursuant to the NPA or the related Participation
Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.
INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as
of March 25, 2002 among the Related Trustee (and after the Transfer Date,
the Trustee), the Related Other Trustees (and after the Transfer Date, the
Other Trustees), the Above-Cap Liquidity Provider, the Primary Liquidity
Provider, the primary liquidity provider relating to the Class G-2
Certificates, the Policy Provider and Wilmington Trust Company, as
Subordination Agent and as trustee thereunder, as amended, supplemented or
otherwise modified from time to time in accordance with its terms.
INVESTORS: Means the Underwriters, together with all subsequent
beneficial owners of the Applicable Certificates.
MAKE-WHOLE AMOUNT: Has the meaning specified in the Indentures.
NEW AIRCRAFT: Has the meaning specified in the NPA.
NOTE DOCUMENTS: Means the Equipment Notes with respect to the
Applicable Certificates and, with respect to any such Equipment Note, the
Indenture and the Participation Agreement relating to such Equipment Note.
NPA: Means the Note Purchase Agreement dated as of March 25, 2002
among the Related Trustee (and after the Transfer Date, the Trustee), the
Related Other Trustees (and after the Transfer Date, the Other Trustees),
the Company, the Escrow Agent, the Escrow Paying Agent and the
Subordination Agent, as the same may be amended, supplemented or otherwise
modified from time to time, in accordance with its terms.
OTHER AGREEMENTS: Means (i) the Basic Agreement as supplemented by
Trust Supplement No. 2002-1G-2-S dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1G-2-S, (ii) the Basic
Agreement as supplemented by Trust Supplement No. 2002-1H-S dated as of
the date hereof relating to Continental Airlines Pass Through Trust
2002-1H-S and (iii) the Basic Agreement as supplemented by Trust
Supplement No. 2002-1I-S dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1I-S.
OTHER TRUSTEES: Means the trustees under the Other Agreements, and
any successor or other trustee appointed as provided therein.
OTHER TRUSTS: Means the Continental Airlines Pass Through Trust
2002-1G-2-S, the Continental Airlines Pass Through Trust 2002-1H-S and the
Continental Airlines Pass Through Trust 2002-1I-S, created by the Other
Agreements.
OUTSTANDING: When used with respect to Applicable Certificates,
means, as of the date of determination, all Transfer Date Certificates,
and all other Applicable Certificates theretofore authenticated and
delivered under the Agreement, in each case except:
(i) Applicable Certificates theretofore canceled by the
Registrar or delivered to the Trustee or the Registrar for
cancellation;
(ii) Applicable Certificates for which money in the full
amount required to make the final distribution with respect to such
Applicable Certificates pursuant to Section 11.01 of the Basic
Agreement has been theretofore deposited with the Trustee in trust
for the Applicable Certificateholders as provided in Section 4.01 of
the Basic Agreement pending distribution of such money to such
Applicable Certificateholders pursuant to payment of such final
distribution; and
(iii) Applicable Certificates in exchange for or in lieu of
which other Applicable Certificates have been authenticated and
delivered pursuant to the Agreement.
OWNED AIRCRAFT: Has the meaning specified in the third recital to
this Trust Supplement.
PARTICIPATION AGREEMENT: Means each Participation Agreement entered
into by the Related Trustee pursuant to the NPA, as the same may be
amended, supplemented or otherwise modified in accordance with its terms.
POLICY: Means, with respect to the Applicable Certificates, Ambac
Certificate Guarantee Insurance Policy No. AB0542BE, together with the
Certificate Guaranty Insurance Policy Endorsement attached thereto, issued
as of the Closing Date, as amended, supplemented or otherwise modified
from time to time in accordance with its terms.
POLICY PROVIDER: Has the meaning specified in the Intercreditor
Agreement.
POLICY PROVIDER AGREEMENT: Has the meaning specified in the
Intercreditor Agreement.
POLICY PROVIDER DEFAULT: Has the meaning specified in the
Intercreditor Agreement.
POOL BALANCE: Means, as of any date, (i) the original aggregate face
amount of the "Applicable Certificates" as defined in the Related Pass
Through Trust Agreement, less (ii) the aggregate amount of all payments
made as of such date in respect of such Certificates, the Applicable
Certificates (as defined in the Related Pass Through Trust Agreement) or
the Deposits, other than payments made in respect of interest or premium,
Make-Whole Amount, Deposit Break Amount or Break Amount thereon or
reimbursement of any costs or expenses incurred in connection therewith.
The Pool Balance as of any date shall be computed after giving effect to
any special distribution with respect to unused Deposits, payment of
principal of the Equipment Notes, payments under the Policy (other than in
respect of interest on the Applicable Certificates) or payment with
respect to other Trust Property and the distribution thereof to be made on
that date.
POOL FACTOR: Means, as of any Distribution Date, the quotient
(rounded to the seventh decimal place) computed by dividing (i) the Pool
Balance by (ii) the original aggregate face amount of the "Applicable
Certificates" as defined in the Related Pass Through Trust Agreement. The
Pool Factor as of any Distribution Date shall be computed after giving
effect to any special distribution with respect to unused Deposits,
payment of principal of the Equipment Notes, payment under the Policy
(other than in respect of interest on the Applicable Certificates) or
payment with respect to other Trust Property and the distribution thereof
to be made on that date.
PRIMARY LIQUIDITY FACILITY: Means, initially, the Revolving Credit
Agreement dated as of March 25, 2002 relating to the Applicable
Certificates, between the Primary Liquidity Provider and Wilmington Trust
Company, as Subordination Agent, as agent and trustee for the Applicable
Trust, and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement primary liquidity facility
therefor, in each case as amended, supplemented or otherwise modified from
time to time in accordance with their respective terms.
PRIMARY LIQUIDITY PROVIDER: Means, initially, Landesbank
Hessen-Thuringen Girozentrale, a German public law institution duly
established under the Treaty on the Formation of a Joint Savings Banks
Organization Hessen-Thuringen, and any replacements or successors therefor
appointed in accordance with the Intercreditor Agreement.
PROSPECTUS SUPPLEMENT: Means the final Prospectus Supplement dated
March 11, 2002 relating to the offering of the Applicable Certificates and
the Class G-2 Certificates.
RATINGS CONFIRMATION: Has the meaning specified in the Intercreditor
Agreement.
REFERENCE AGENCY AGREEMENT: Has the meaning specified in the NPA.
RELATED OTHER PASS THROUGH TRUST AGREEMENTS: Means the "Other
Agreements" as defined in the Related Pass Through Trust Agreement.
RELATED OTHER TRUSTEES: Means the "Other Trustees" as defined in the
Related Pass Through Trust Agreement.
RELATED OTHER TRUSTS: Means the "Other Trusts" as defined in the
Related Pass Through Trust Agreement.
RELATED PASS THROUGH TRUST AGREEMENT: Means the Basic Agreement as
supplemented by the Trust Supplement No. 2002-1G-1-O dated as of the date
hereof (the "RELATED PASS THROUGH TRUST SUPPLEMENT"), relating to the
Continental Airlines Pass Through Trust 2002-1G-1-O and entered into by
the Company and the Related Trustee, as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
RELATED TRUST: Means the Continental Pass Through Trust 2002-1G-1-O,
formed under the Related Pass Through Trust Agreement.
RELATED TRUSTEE: Means the trustee under the Related Pass Through
Trust Agreement.
SCHEDULED PAYMENT: Means, with respect to any Equipment Note, (i)
any payment of principal or interest on such Equipment Note (other than
any such payment which is not in fact received by the Trustee or any
Subordination Agent within five days of the date on which such payment is
scheduled to be made) or (ii) any payment of interest on the Applicable
Certificates with funds drawn under the Primary Liquidity Facility or
withdrawn from the Class G-1 Above-Cap Account or any payment of interest
on or principal of the Applicable Certificates with funds drawn under the
Policy, which payment in any such case represents the installment of
principal on such Equipment Note at the stated maturity of such
installment, the payment of regularly scheduled interest accrued on the
unpaid principal amount of such Equipment Note, or both; PROVIDED,
HOWEVER, that any payment of principal, premium, Make-Whole Amount,
Deposit Break Amount or Break Amount, if any, or interest resulting from
the redemption or purchase of any Equipment Note shall not constitute a
Scheduled Payment.
SPECIAL PAYMENT: Means any payment (other than a Scheduled Payment)
in respect of, or any proceeds of, any Equipment Note, Collateral (as
defined in each Indenture) or Deposit Break Amount.
SUBSTITUTE AIRCRAFT: Has the meaning specified in the NPA.
TRANSFER DATE: Means the moment of execution and delivery of the
Assignment and Assumption Agreement by each of the parties thereto.
TRANSFER DATE CERTIFICATES: Has the meaning specified in the
definition of "Applicable Certificates".
TRIGGERING EVENT: Has the meaning assigned to such term in the
Intercreditor Agreement.
TRUST PROPERTY: Means (i) subject to the Intercreditor Agreement,
the Equipment Notes held as the property of the Applicable Trust, all
monies at any time paid thereon and all monies due and to become due
thereunder, (ii) funds from time to time deposited in the Certificate
Account and the Special Payments Account and, subject to the Intercreditor
Agreement, any proceeds from the sale by the Trustee pursuant to Article
VI of the Basic Agreement of any Equipment Note and (iii) all rights of
the Applicable Trust and the Trustee, on behalf of the Applicable Trust,
under the Intercreditor Agreement, the Escrow Agreement, the NPA, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility and the
Policy, including, without limitation, all rights to receive certain
payments thereunder, and all monies paid to the Trustee on behalf of the
Applicable Trust pursuant to the Intercreditor Agreement, the Above-Cap
Liquidity Facility, the Primary Liquidity Facility or the Policy, PROVIDED
that rights with respect to the Deposits or under the Escrow Agreement
will not constitute Trust Property.
TRUST SUPPLEMENT: Has the meaning specified in the first paragraph
of this trust supplement.
TRUSTEE: Has the meaning specified in the first paragraph of this
Trust Supplement.
UNDERWRITERS: Means, collectively, Credit Suisse First Boston
Corporation, J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Salomon Smith Barney Inc. and Morgan Stanley & Co.
Incorporated.
UNDERWRITING AGREEMENT: Means the Underwriting Agreement dated March
11, 2002 among the Underwriters, the Company and the Depositary, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
ARTICLE III
DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. STATEMENTS TO APPLICABLE CERTIFICATEHOLDERS. (a) On
each Distribution Date, the Trustee will include with each distribution to
Applicable Certificateholders of a Scheduled Payment or Special Payment, as the
case may be, a statement setting forth the information provided below (in the
case of a Special Payment, reflecting in part the information provided by the
Escrow Paying Agent under the Escrow Agreement). Such statement shall set forth
(per $1,000 face amount Applicable Certificate as to (ii), (iii), (iv) and (v)
below) the following information:
(i) the aggregate amount of funds distributed on such Distribution
Date under the Agreement and under the Escrow Agreement, indicating the
amount allocable to each source, including any portion thereof paid by the
Primary Liquidity Provider or the Policy Provider or withdrawn from the
Class G-1 Above-Cap Account;
(ii) the amount of such distribution under the Agreement allocable
to principal and the amount allocable to premium, Make-Whole Amount,
Deposit Break Amount or Break Amount, if any;
(iii) the amount of such distribution under the Agreement allocable
to interest;
(iv) the amount of such distribution under the Escrow Agreement
allocable to interest;
(v) the amount of such distribution under the Escrow Agreement
allocable to unused Deposits, if any;
(vi) the Pool Balance and the Pool Factor; and
(vii) the LIBOR rates and the resulting interest rates payable on
the Applicable Certificates for the current and immediately preceding
Interest Periods.
With respect to the Applicable Certificates registered in the name
of a Clearing Agency, on the Record Date prior to each Distribution Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such Record Date. On each Distribution Date, the Trustee will mail to each such
Clearing Agency Participant the statement described above and will make
available additional copies as requested by such Clearing Agency Participant for
forwarding to holders of interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was an
Applicable Certificateholder of record a statement containing the sum of the
amounts determined pursuant to clauses (a)(i), (a)(ii), (a)(iii), (a)(iv) and
(a)(v) above for such calendar year or, in the event such Person was an
Applicable Certificateholder of record during a portion of such calendar year,
for such portion of such year, and such other items as are readily available to
the Trustee and which an Applicable Certificateholder shall reasonably request
as necessary for the purpose of such Applicable Certificateholder's preparation
of its U.S. federal income tax returns. Such statement and such other items
shall be prepared on the basis of information supplied to the Trustee by the
Clearing Agency Participants and shall be delivered by the Trustee to such
Clearing Agency Participants to be available for forwarding by such Clearing
Agency Participants to the holders of interests in the Applicable Certificates
in the manner described in Section 3.01(a) of this Trust Supplement.
(c) If the aggregate principal payments scheduled for a Regular
Distribution Date prior to the Delivery Period Termination Date differ from the
amount thereof set forth for the Applicable Certificates on page S-42 of the
Prospectus Supplement, by no later than the 15th day prior to such Regular
Distribution Date, the Trustee (if the Related Trustee has not already done so)
shall mail written notice of the actual amount of such scheduled payments to the
Applicable Certificateholders of record as of a date within 15 Business Days
prior to the date of mailing.
(d) Promptly following (i) the Delivery Period Termination Date, if
there has been any change in the information set forth in clauses (y) and (z)
below from that set forth in page S-42 of the Prospectus Supplement, and (ii)
the date of any early redemption or purchase of, or any default in the payment
of principal or interest in respect of, any of the Equipment Notes held in the
Applicable Trust, or any Final Withdrawal, the Trustee (if the Related Trustee
has not already done so) shall furnish to Applicable Certificateholders of
record on such date a statement setting forth (x) the expected Pool Balances for
each subsequent Regular Distribution Date following the Delivery Period
Termination Date, (y) the related Pool Factors for such Regular Distribution
Dates and (z) the expected principal distribution schedule of the Equipment
Notes, in the aggregate, held as Trust Property at the date of such notice. With
respect to the Applicable Certificates registered in the name of a Clearing
Agency, on the Transfer Date, the Trustee (if the Related Trustee has not
already done so) will request from such Clearing Agency a securities position
listing setting forth the names of all Clearing Agency Participants reflected on
such Clearing Agency's books as holding interests in the "Applicable
Certificates" (as defined in the Related Pass Through Trust Agreement) on the
Delivery Period Termination Date. The Trustee (if the Related Trustee has not
already done so) will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as requested
by such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(e) This Section 3.01 supersedes and replaces Section 4.03 of the
Basic Agreement, with respect to the Applicable Trust.
Section 3.02. SPECIAL PAYMENTS ACCOUNT. (a) The Trustee shall
establish and maintain on behalf of the Applicable Certificateholders a Special
Payments Account as one or more accounts, which shall be non-interest bearing
except as provided in Section 4.04 of the Basic Agreement. The Trustee shall
hold the Special Payments Account in trust for the benefit of the Applicable
Certificateholders and shall make or permit withdrawals therefrom only as
provided in the Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement and upon the payment of
the Deposit Break Amount to the Trustee under the NPA, the Trustee, upon receipt
thereof, shall immediately deposit the aggregate amount of such Special Payments
in the Special Payments Account.
(b) This Section 3.02 supersedes and replaces Section 4.01(b) of the
Basic Agreement in its entirety, with respect to the Applicable Trust.
Section 3.03. DISTRIBUTIONS FROM SPECIAL PAYMENTS ACCOUNT. (a) On
each Special Distribution Date with respect to any Special Payment or as soon
thereafter as the Trustee has confirmed receipt of any Special Payments due on
the Equipment Notes held (subject to the Intercreditor Agreement) in the
Applicable Trust or realized upon the sale of such Equipment Notes or receipt of
the Deposit Break Amount, the Trustee shall distribute out of the Special
Payments Account the entire amount of such Special Payment deposited therein
pursuant to Section 3.02(a) of this Trust Supplement. There shall be so
distributed to each Applicable Certificateholder of record on the Record Date
with respect to such Special Distribution Date (other than as provided in
Section 7.01 of this Trust Supplement concerning the final distribution) by
check mailed to such Applicable Certificateholder, at the address appearing in
the Register, such Applicable Certificateholder's pro rata share (based on the
Fractional Undivided Interest in the Applicable Trust held by such Applicable
Certificateholder) of the total amount in the Special Payments Account on
account of such Special Payment, except that, with respect to Applicable
Certificates registered on the Record Date in the name of a Clearing Agency (or
its nominee), such distribution shall be made by wire transfer in immediately
available funds to the account designated by such Clearing Agency (or such
nominee).
(b) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Applicable Certificateholder at his
address as it appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the Applicable Trust, such notice shall be mailed not
less than 15 days prior to the Special Distribution Date for the
Special Payment resulting from such redemption or purchase, which Special
Distribution Date shall be the date of such redemption or purchase. In the case
of any distribution pursuant to Section 3.7(c) or Section 3.7(e) of the
Intercreditor Agreement, the Trustee will mail notice to the Applicable
Certificateholders not less than 15 days prior to the Special Distribution Date
determined for such distribution. In the event of the payment of a Deposit Break
Amount by the Company to the Trustee under the NPA, such notice shall be mailed,
together with the notice by the Escrow Paying Agent under Section 2.07 of the
Escrow Agreement, not less than 15 days prior to the Special Distribution Date
for such amount. In the case of any other Special Payments, such notice shall be
mailed as soon as practicable after the Trustee has confirmed that it has
received funds for such Special Payment, stating the Special Distribution Date
for such Special Payment which shall occur not less than 15 days after the date
of such notice and as soon as practicable thereafter. Notices mailed by the
Trustee shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 7.01 of this Trust Supplement),
(ii) the amount of the Special Payment for each $1,000 face amount
Applicable Certificate and the amount thereof constituting principal,
premium, Make-Whole Amount, Deposit Break Amount or Break Amount, if any,
and interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date, the total amount to be received on such date for each
$1,000 face amount Applicable Certificate.
If the amount of (i) premium, Make-Whole Amount or Break Amount, if any, payable
upon the redemption or purchase of an Equipment Note or (ii) the Deposit Break
Amount, if any, has not been calculated at the time that the Trustee mails
notice of a Special Payment, it shall be sufficient if the notice sets forth the
other amounts to be distributed and states that any premium, Make-Whole Amount,
Deposit Break Amount or Break Amount received will also be distributed.
If any redemption of the Equipment Notes held in the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Applicable Certificateholder at its address
as it appears on the Register.
(b) This Section 3.03 supersedes and replaces Section 4.02(b) and
Section 4.02(c) of the Basic Agreement in their entirety, with respect to the
Applicable Trust.
Section 3.04. LIMITATION OF LIABILITY FOR PAYMENTS. Section 3.09 of
the Basic Agreement shall be amended, with respect to the Applicable Trust, by
deleting the phrase "the Owner Trustees or the Owner Participants" in the second
sentence thereof and adding in lieu thereof "the Above-Cap Liquidity Provider,
the Primary Liquidity Provider or the Policy Provider".
ARTICLE IV
DEFAULT
Section 4.01. PURCHASE RIGHTS OF CERTIFICATEHOLDERS. (a) At any time
after the occurrence and during the continuation of a Triggering Event, if the
Class G-2 Trustee is then the Controlling Party, each Applicable
Certificateholder (other than the Company or any of its Affiliates) shall have
the right to purchase, for the purchase price set forth in the Class G-2 Trust
Agreement, all, but not less than all, of the Class G-2 Certificates upon ten
days' written notice to the Class G-2 Trustee and each other Applicable
Certificateholder, PROVIDED that (i) if prior to the end of such ten-day period
any other Applicable Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Applicable Certificateholder that such
other Applicable Certificateholder wants to participate in such purchase, then
such other Applicable Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Applicable Certificateholder to
purchase all, but not less than all, of the Class G-2 Certificates pro rata
based on the Fractional Undivided Interest in the Applicable Trust held by each
such Applicable Certificateholder and (ii) if prior to the end of such ten-day
period any other Applicable Certificateholder fails to notify the purchasing
Applicable Certificateholder of such other Applicable Certificateholder's desire
to participate in such a purchase, then such other Applicable Certificateholder
shall lose its right to purchase the Class G-2 Certificates pursuant to this
Section 4.01(a).
(b) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after the occurrence and during the
continuation of a Triggering Event,
(i) if the Trustee is then the Controlling Party, each Class G-2
Certificateholder (other than the Company or any of its Affiliates) shall
have the right to purchase all, but not less than all, of the Applicable
Certificates upon ten days' written notice to the Trustee and each other
Class G-2 Certificateholder, PROVIDED that (A) if prior to the end of such
ten-day period any other Class G-2 Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Class G-2
Certificateholder that such other Class G-2 Certificateholder wants to
participate in such purchase, then such other Class G-2 Certificateholder
(other than the Company or any of its Affiliates) may join with the
purchasing Class G-2 Certificateholder to purchase all, but not less than
all, of the Applicable Certificates pro rata based on the Fractional
Undivided Interest in the Class G-2 Trust held by each such Class G-2
Certificateholder and (B) if prior to the end of such ten-day period any
other Class G-2 Certificateholder fails to notify the purchasing Class G-2
Certificateholder of such other Class G-2 Certificateholder's desire to
participate in such a purchase, then such other Class G-2
Certificateholder shall lose its right to purchase the Applicable
Certificates pursuant to this Section 4.01(b)(i);
(ii) each Class H Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a) or (b)(i)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice
to the Trustee, the Class G-2 Trustee and each other Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Class H Certificateholder (other than the Company or any
of its Affiliates) notifies such purchasing Class H Certificateholder that
such other Class H Certificateholder wants to participate in such
purchase, then such other Class H Certificateholder (other than the
Company or any of its Affiliates) may join with the purchasing Class H
Certificateholder to purchase all, but not less than all, of the
Applicable Certificates and the Class G-2 Certificates pro rata based on
the Fractional Undivided Interest in the Class H Trust held by each such
Class H Certificateholder and (B) if prior to the end of such ten-day
period any other Class H Certificateholder fails to notify the purchasing
Class H Certificateholder of such other Class H Certificateholder's desire
to participate in such a purchase, then such other Class H
Certificateholder shall lose its right to purchase the Applicable
Certificates and the Class G-2 Certificates pursuant to this Section
4.01(b)(ii);
(iii) if Re-Issued Class H Certificates are issued, each Re-Issued
Class H Certificateholder (other than the Company or any of its
Affiliates) shall have the right (which shall not expire upon any purchase
of the Applicable Certificates pursuant to clause (a), (b)(i) or (b)(ii)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice
to the Trustee, the Class G-2 Trustee and each other Re-Issued Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Re-Issued Class H Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Re-Issued Class
H Certificateholder that such other Re-Issued Class H Certificateholder
wants to participate in such purchase, then such other Re-Issued Class H
Certificateholder (other than the Company or any of its Affiliates) may
join with the purchasing Re-Issued Class H Certificateholder to purchase
all, but not less than all, of the Applicable Certificates and the Class
G-2 Certificates pro rata based on the Fractional Undivided Interest in
the Re-Issued Class H Trust held by each such Re-Issued Class H
Certificateholder and (B) if prior to the end of such ten-day period any
other Re-Issued Class H Certificateholder fails to notify the purchasing
Re-Issued Class H Certificateholder of such other Re-Issued Class H
Certificateholder's desire to participate in such a purchase, then such
other Re-Issued Class H Certificateholder shall lose its right to purchase
the Applicable Certificates and the Class G-2 Certificates pursuant to
this Section 4.01(b)(iii);
(iv) each Class I Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii) or (b)(iii) above) to purchase all, but not less than all, of the
Applicable Certificates, the Class G-2 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) upon ten
days' written notice to the Trustee, the Class G-2 Trustee, the Class H
Trustee (or, if any Re-Issued Class H Certificates have been issued, the
Re-Issued Class H Trustee) and each other Class I Certificateholder,
PROVIDED that (A) if prior to the end of such ten-day period any other
Class I Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Class I Certificateholder that such
other Class I Certificateholder wants to participate in such purchase,
then such other Class I Certificateholder (other than the Company or any
of its Affiliates) may join with the purchasing Class I Certificateholder
to purchase all, but not less than all, of the Applicable Certificates,
the Class G-2 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) pro rata based on the Fractional Undivided
Interest in the Class I Trust held by each such Class I Certificateholder
and (B) if prior to the end of such ten-day period any other Class I
Certificateholder fails to notify the purchasing Class I Certificateholder
of such other Class I Certificateholder's desire to participate in such a
purchase, then such other Class I Certificateholder shall lose its right
to purchase the Applicable Certificates, the Class G-2 Certificates, the
Class H Certificates (or, if issued, the Re-Issued Class H Certificates)
pursuant to this Section 4.01(b)(iv); and
(v) each Class J Certificateholder, other than the Company or any of
its Affiliates, shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii), (b)(iii) or (b)(iv) above) to purchase all, but not less than
all, of the Applicable Certificates, the Class G-2 Certificates, the Class
H Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates upon ten days' written notice to the Trustee, the
Class G-2 Trustee, the Class H Trustee (or, if any Re-Issued Class H
Certificates have been issued, the Re-Issued Class H Trustee), the Class I
Trustee and each other Class J Certificateholder, PROVIDED that (A) if
prior to the end of such ten-day period any other Class J
Certificateholder (other than the Company or any of its Affiliates)
notifies such purchasing Class J Certificateholder that such other Class J
Certificateholder wants to participate in such purchase, then such other
Class J Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Class J Certificateholder to
purchase all, but not less than all, of the Applicable Certificates, the
Class G-2 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) and the Class I Certificates pro rata
based on the Fractional Undivided Interest in the Class J Trust held by
each such Class J Certificateholder and (B) if prior to the end of such
ten-day period any other Class J Certificateholder fails to notify the
purchasing Class J Certificateholder of such other Class J
Certificateholder's desire to participate in such a purchase, then such
other Class J Certificateholder shall lose its right to purchase the
Applicable Certificates, the Class G-2 Certificates, the Class H
Certificates, the Re-Issued Class H Certificates (if any) and the Class I
Certificates pursuant to this Section 4.01(b)(v).
(c) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after 180 days have elapsed since the
occurrence of a Triggering Event that is continuing, regardless of whether the
Applicable Certificateholders exercise their right to purchase the Class G-2
Certificates pursuant to Section 4.01(a), the Policy Provider, if it is then the
Controlling Party, shall have the right (except in the event of a Policy
Provider Default) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-2 Certificates upon ten days' written notice to the
Trustee, the Class G-2 Trustee, the Applicable Certificateholders and the Class
G-2 Certificateholders.
The purchase price with respect to the Applicable Certificates shall
be equal to the Pool Balance of the Applicable Certificates, together with
accrued and unpaid interest thereon to the date of such purchase, without
premium, but including any other amounts then due and payable to the Applicable
Certificateholders under the Agreement, the Intercreditor Agreement, the Escrow
Agreement or any Note Document or on or in respect of the Applicable
Certificates; PROVIDED, HOWEVER, that no such purchase of Applicable
Certificates shall be effective unless the purchaser(s) shall certify to the
Trustee that contemporaneously with such purchase, such purchaser(s) is (are)
purchasing, pursuant to the terms of the Agreement and the Other Agreements
(and, if any Re-Issued Class H Certificates have been issued, the pass through
trust agreement relating thereto), (A) in the case of any purchase of the
Applicable Certificates pursuant to clause (b)(i) above, all of the Applicable
Certificates, (B) in the case of any purchase of the Applicable Certificates
pursuant to clause (c) above, all of the Applicable Certificates and the Class
G-2 Certificates, or (C) in all other cases, the Applicable Certificates, the
Class G-2 Certificates, the Class H Certificates (or, if issued, the Re-Issued
Class H Certificates) and the Class I Certificates that are senior to the
securities held by such purchaser(s). Each payment of the purchase price of the
Applicable Certificates referred to in the first sentence hereof shall be made
to an account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01. Each Applicable Certificateholder
agrees by its acceptance of its Applicable Certificate that (at any time after
the occurrence and during the continuation of a Triggering Event) it will, upon
payment from such Class G-2 Certificateholder(s), Class H Certificateholder(s)
(or, if any Re-Issued Class H Certificates have been issued, Re-Issued Class H
Certificateholder(s)), Class I Certificateholder(s), Class J
Certificateholder(s) or the Policy Provider, as the case may be, of the purchase
price set forth in the first sentence of this paragraph, (i) forthwith sell,
assign, transfer and convey to the purchaser(s) thereof (without recourse,
representation or warranty of any kind except for its own acts), all of the
right, title, interest and obligation of such Applicable Certificateholder in
the Agreement, the Escrow Agreement, the Deposit Agreement, the Intercreditor
Agreement, the Above-Cap Liquidity Facility, the Primary Liquidity Facility, the
Policy, the NPA, the Note Documents and all Applicable Certificates and Escrow
Receipts held by such Applicable Certificateholder (excluding all right, title
and interest under any of the foregoing to the extent such right, title or
interest is with respect to an obligation not then due and payable as respects
any action or inaction or state of affairs occurring prior to such sale) (and
the purchaser shall assume all of such Applicable Certificateholder's
obligations under the Agreement, the Escrow Agreement, the Deposit Agreement,
the Intercreditor Agreement, the Above-Cap Liquidity Facility, the Primary
Liquidity Facility, the Policy, the NPA, the Note Documents and all such
Applicable Certificates and Escrow Receipts), (ii) if such purchase occurs after
a record date specified in Section 2.03 of the Escrow Agreement relating to the
distribution of unused Deposits and/or accrued and unpaid interest on Deposits
and prior to or on the related distribution date thereunder, forthwith turn over
to the purchaser(s) of its Applicable Certificate all amounts, if any, received
by it on account of such distribution, and (iii) if such purchase occurs after a
Record Date relating to any distribution and prior to or on the related
Distribution Date, forthwith turn over to the purchaser(s) of its Applicable
Certificate all amounts, if any, received by it on account of such distribution.
The Applicable Certificates will be deemed to be purchased on the date payment
of the purchase price is made notwithstanding the failure of the Applicable
Certificateholders to deliver any Applicable Certificates and, upon such a
purchase, (I) the only rights of the Applicable Certificateholders will be to
deliver the Applicable Certificates to the purchaser(s) and receive the purchase
price for such Applicable Certificates and (II) if the purchaser(s) shall so
request, such Applicable Certificateholder will comply with all the provisions
of Section 3.04 of the Basic Agreement to enable new Applicable Certificates to
be issued to the purchaser in such denominations as it shall request. All
charges and expenses in connection with the issuance of any such new Applicable
Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01 and elsewhere in this Trust Supplement,
the terms "Class G-2 Certificate", "Class G-2 Certificateholder", "Class G-2
Trust", "Class G-2 Trust Agreement", "Class G-2 Trustee", "Class H Certificate",
"Class H Certificateholder", "Class H Trust", "Class H Trustee", "Class I
Certificate", "Class I Certificateholder", "Class I Trust", "Class I Trustee",
"Class J Certificate", "Class J Certificateholder", "Class J Trust", "Re-Issued
Class H Certificate", "Re-Issued Class H Certificateholder", "Re-Issued Class H
Trust" and "Re-Issued Class H Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(d) This Section 4.01 supersedes and replaces Section 6.01(b) of the
Basic Agreement, with respect to the Applicable Trust.
Section 4.02. AMENDMENT OF SECTION 6.05 OF THE BASIC AGREEMENT.
Section 6.05 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by deleting the phrase "and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto," set forth in the first sentence thereof.
ARTICLE V
THE TRUSTEE
Section 5.01. ACQUISITION OF TRUST PROPERTY. (a) The Trustee is
hereby irrevocably authorized and directed to execute and deliver the Assignment
and Assumption Agreement on the date specified in Section 7.01 of the Related
Pass Through Trust Supplement, subject only to the satisfaction of the
conditions set forth in said Section 7.01. The Agreement (except only for this
sentence and the immediately preceding sentence hereof, which are effective upon
execution and delivery hereof) shall become effective upon the execution and
delivery of the Assignment and Assumption Agreement by the Trustee and the
Related Trustee, automatically and without any further signature or action on
the part of the Company and the Trustee, and shall thereupon constitute the
legal, valid and binding obligation of the parties hereto enforceable against
each of the parties hereto in accordance with its terms. Upon such execution and
delivery of the Assignment and Assumption Agreement, the Related Trust shall be
terminated, the Applicable Certificateholders shall receive beneficial interests
in the Applicable Trust in exchange for their interests in the Related Trust
equal to their respective beneficial interests in the Related Trust and the
"Outstanding" (as defined in the Related Pass Through Trust Agreement) pass
through certificates representing fractional undivided interests in the Related
Trust shall be deemed for all purposes of the Agreement, without further
signature or action of any party or Certificateholder, to be Certificates
representing the same Fractional Undivided Interests in the Trust and Trust
Property. By acceptance of its Applicable Certificate, each Applicable
Certificateholder consents to and ratifies such assignment, transfer and
delivery of the trust property of the Related Trust to the Trustee upon the
execution and delivery of the Assignment and Assumption Agreement. The
provisions of this Section 5.01(a) supersede and replace the provisions of
Section 2.02 of the Basic Agreement with respect to the Applicable Trust, and
all provisions of the Basic Agreement relating to Postponed Notes or Section
2.02 of the Basic Agreement shall not apply to the Applicable Trust.
(b) The Trustee, upon the execution and delivery of the Assignment
and Assumption Agreement, acknowledges its acceptance of all right, title and
interest in and to the Trust Property and declares that the Trustee holds and
will hold such right, title and interest for the benefit of all then present and
future Applicable Certificateholders, upon the trusts herein and in the Basic
Agreement set forth. By the acceptance of each Applicable Certificate issued to
it under the Related Pass Through Trust Agreement and deemed issued under the
Agreement, each Holder of any such Applicable Certificate as grantor of the
Applicable Trust thereby joins in the creation and declaration of the Applicable
Trust. The provisions of this Section 5.01(b) supersede and replace the
provisions of Section 2.03 of the Basic Agreement, with respect to the
Applicable Trust.
Section 5.02. [Intentionally Omitted]
Section 5.03. THE TRUSTEE. (a) Subject to Section 5.04 of this Trust
Supplement and Section 7.15 of the Basic Agreement, the Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Trust Supplement, the Deposit Agreement, the NPA or the
Escrow Agreement or the due execution hereof or thereof by the Company or the
other parties thereto (other than the Trustee), or for or in respect of the
recitals and statements contained herein or therein, all of which recitals and
statements are made solely by the Company, except that the Trustee hereby
represents and warrants that each of this Trust Supplement, the Basic Agreement,
each Applicable Certificate, the Intercreditor Agreement, the NPA and the Escrow
Agreement has been executed and delivered by one of its officers who is duly
authorized to execute and deliver such document on its behalf.
(b) Except as herein otherwise provided and except during the
continuation of an Event of Default in respect of the Applicable Trust created
hereby, no duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this Trust Supplement other
than as set forth in the Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions set
forth in the Agreement, as fully to all intents as if the same were herein set
forth at length.
Section 5.04. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants, on the Transfer Date, that:
(a) the Trustee has full power, authority and legal right to receive
the Trust Property assigned by the Related Trustee, assume the obligations
under, and perform, the Assignment and Assumption Agreement, this Trust
Supplement, the Intercreditor Agreement, the Escrow Agreement, the NPA and
the Note Documents to which it is a party and has taken all necessary
action to authorize such receipt, assumption and performance by it of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is a party;
(b) the receipt of the Trust Property under the Assignment and
Assumption Agreement and the performance by the Trustee of the Assignment
and Assumption Agreement, this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party (i) will not violate any provision of any United States
federal law or the law of the state of the United States where it is
located governing the banking and trust powers of the Trustee or any
order, writ, judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will not
violate any provision of the articles of association or by-laws of the
Trustee, and (iii) will not violate any provision of, or constitute, with
or without notice or lapse of time, a default under, or result in the
creation or imposition of any lien on any properties included in the Trust
Property pursuant to the provisions of any mortgage, indenture, contract,
agreement or other undertaking to which it is a party, which violation,
default or lien could reasonably be expected to have an adverse effect on
the Trustee's performance or ability to perform its duties hereunder or
thereunder or on the transactions contemplated herein or therein;
(c) the receipt of the Trust Property under the Assignment and
Assumption Agreement and the performance by the Trustee of the Assignment
and Assumption Agreement, this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party will not require the authorization, consent, or approval of,
the giving of notice to, the filing or registration with, or the taking of
any other action in respect of, any governmental authority or agency of
the United States or the state of the United States where it is located
regulating the banking and corporate trust activities of the Trustee; and
(d) the Assignment and Assumption Agreement has been duly executed
and delivered by the Trustee and this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party have been, or will be, as applicable, duly executed and
delivered by the Trustee and constitute, or will constitute, as
applicable, the legal, valid and binding agreements of the Trustee,
enforceable against it in accordance with their respective terms;
PROVIDED, HOWEVER, that enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and (ii) general principles of
equity.
Section 5.05. TRUSTEE LIENS. The Trustee in its individual capacity
agrees, in addition to the agreements contained in Section 7.17 of the Basic
Agreement, that it will at its own cost and expense promptly take any action as
may be necessary to duly discharge and satisfy in full any Trustee's Liens on or
with respect to the Trust Property which is attributable to the Trustee in its
individual capacity and which is unrelated to the transactions contemplated by
the Intercreditor Agreement or the NPA.
ARTICLE VI
ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS
Section 6.01. AMENDMENT OF SECTION 5.02 OF THE BASIC AGREEMENT.
Section 5.02 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by (i) replacing the phrase "of the Note Documents and of this
Agreement" set forth in paragraph (b) thereof with the phrase "of the Note
Documents, of the NPA and of this Agreement" and (ii) replacing the phrase "of
this Agreement and any Note Document" set forth in the last paragraph of Section
5.02 with the phrase "of this Agreement, the NPA and any Note Document".
Section 6.02. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.01 of the Basic Agreement,
under the terms of, and subject to the limitations contained in, Section 9.01 of
the Basic Agreement, the Company may (but will not be required to), and the
Trustee (subject to Section 9.03 of the Basic Agreement) shall, at the Company's
request, at any time and from time to time, (i) enter into one or more
agreements supplemental to the Escrow Agreement, the NPA, the Deposit Agreement,
the Reference Agency Agreement, the Policy or the Policy Provider Agreement for
any of the purposes set forth in clauses (1) through (9) of such Section 9.01,
and (without limitation of the foregoing or Section 9.01 of the Basic Agreement)
(a) the reference in the introductory paragraph of Section 9.01 of the Basic
Agreement to a "Liquidity Facility" shall be deemed to refer to "the Above-Cap
Liquidity Facility and the Primary Liquidity Facility", (b) clauses (2) and (3)
of such Section 9.01 shall also be deemed to include the Company's obligations
under (in the case of clause (2)), and the Company's rights and powers conferred
by (in the case of clause (3)), the NPA, the Reference Agency Agreement, the
Policy or the Policy Provider Agreement and (c) references in clauses (4), (6)
and (7) of such Section 9.01 to "any Intercreditor Agreement or any Liquidity
Facility" shall also be deemed to refer to "the Intercreditor Agreement, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility, the Escrow
Agreement, the Reference Agency Agreement, the NPA, the Deposit Agreement, the
Policy or the Policy Provider Agreement", (ii) enter into one or more agreements
supplemental to the Agreement, the Intercreditor Agreement, the Reference Agency
Agreement or the NPA to provide for the formation of the Re-Issued Class H
Trust, the issuance of the Re-Issued Class H Certificates, the purchase by the
Re-Issued Class H Trust of Equipment Notes and other matters incidental thereto
or otherwise contemplated by Section 2.01(b) of the Basic Agreement; PROVIDED
that (x) a Ratings Confirmation for the Applicable Certificates and the Class
G-2 Certificates shall have been obtained with respect to such agreements and
(y) the Company shall have certified to the Trustee and to the Other Trustees
that such agreements shall not materially and adversely affect the Applicable
Certificateholders or the Class G-2 Certificateholders and (iii) enter into one
or more agreements supplemental to the Agreement to provide for the formation of
a Class J Trust, the issuance of Class J Certificates, the purchase by the Class
J Trust of Equipment Notes and other matters incidental thereto or otherwise
contemplated by Section 2.01(b) of the Basic Agreement.
Section 6.03. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.02 of the Basic Agreement,
the provisions of Section 9.02 of the Basic Agreement shall apply to agreements
or amendments for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Escrow Agreement, the Deposit
Agreement, the Above-Cap Liquidity Facility, the Primary Liquidity Facility, the
Reference Agency Agreement, the NPA, the Policy or the Policy Provider Agreement
or modifying in any manner the rights and obligations of the Applicable
Certificateholders under the Escrow Agreement, the Deposit Agreement, the
Above-Cap Liquidity Facility, the Primary Liquidity Facility, the Reference
Agency Agreement, the NPA, the Policy or the Policy Provider Agreement; provided
that the provisions of Section 9.02(1) of the Basic Agreement shall be deemed to
include reductions in any manner of, or delay in the timing of, any receipt by
the Applicable Certificateholders of payments upon the Deposits.
Section 6.04. CONSENT OF HOLDERS OF CERTIFICATES ISSUED UNDER OTHER
TRUSTS. Notwithstanding any provision in Section 6.02 or Section 6.03 of this
Trust Supplement to the contrary, no amendment or modification of Section 4.01
of this Trust Supplement shall be effective unless the trustee for each Class of
Certificates affected by such amendment or modification shall have consented
thereto.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. TERMINATION OF THE APPLICABLE TRUST. (a) The
respective obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the distribution to all
Applicable Certificateholders and the Trustee of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property; PROVIDED, HOWEVER, that in no event
shall the Applicable Trust continue beyond one hundred ten (110) years following
the date of the execution of this Trust Supplement.
Notice of any termination, specifying the Distribution Date upon
which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the 15th day
next preceding such final Distribution Date specifying (A) the Distribution Date
upon which the proposed final payment of the Applicable Certificates will be
made upon presentation and surrender of Applicable Certificates at the office or
agency of the Trustee therein specified, (B) the amount of any such proposed
final payment, and (C) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Applicable Certificates at the office or agency of the
Trustee therein specified. The Trustee shall give such notice to the Registrar
at the time such notice is given to Applicable Certificateholders. Upon
presentation and surrender of the Applicable Certificates in accordance with
such notice, the Trustee shall cause to be distributed to Applicable
Certificateholders such final payments.
In the event that all of the Applicable Certificateholders shall not
surrender their Applicable Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Trustee shall give
a second written notice to the remaining Applicable Certificateholders to
surrender their Applicable Certificates for cancellation and receive the final
distribution with respect thereto. No additional interest shall accrue on the
Applicable Certificates after the Distribution Date specified in the first
written notice. In the event that any money held by the Trustee for the payment
of distributions on the Applicable Certificates shall remain unclaimed for two
years (or such lesser time as the Trustee shall be satisfied, after sixty days'
notice from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money relating
to such Loan Trustee and shall give written notice thereof to the Company.
(b) The provisions of this Section 7.01 supersede and replace the
provisions of Section 11.01 of the Basic Agreement in its entirety, with respect
to the Applicable Trust.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. BASIC AGREEMENT RATIFIED. Except and so far as herein
expressly provided, all of the provisions, terms and conditions of the Basic
Agreement are in all respects ratified and confirmed; and the Basic Agreement
and this Trust Supplement shall be taken, read and construed as one and the same
instrument. All replacements of provisions of, and other modifications of the
Basic Agreement set forth in this Trust Supplement are solely with respect to
the Applicable Trust.
Section 8.02. GOVERNING LAW. THE AGREEMENT AND THE APPLICABLE
CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK. THIS SECTION 8.02 SUPERSEDES AND REPLACES SECTION 12.05
OF THE BASIC AGREEMENT, with respect to the Applicable Trust.
Section 8.03. EXECUTION IN COUNTERPARTS. This Trust Supplement may
be executed in any number of counterparts, each of which shall be an original,
but such counterparts shall together constitute but one and the same instrument.
Section 8.04. INTENTION OF PARTIES. The parties hereto intend that
the Applicable Trust be classified for U.S. federal income tax purposes as a
grantor trust under Subpart E, Part I of Subchapter J of the Internal Revenue
Code of 1986, as amended, and not as a trust or association taxable as a
corporation or as a partnership. Each Applicable Certificateholder and Investor,
by its acceptance of its Applicable Certificate or a beneficial interest
therein, agrees to treat the Applicable Trust as a grantor trust for all U.S.
federal, state and local income tax purposes. The powers granted and obligations
undertaken pursuant to the Agreement shall be so construed so as to further such
intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Trust Supplement to be duly executed by their respective officers thereto duly
authorized, as of the day and year first written above.
CONTINENTAL AIRLINES, INC.
By:
---------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
---------------------------------------
Name:
Title:
[Execution copy]
TRUST SUPPLEMENT No. 2002-1G-2-O
Dated as of March 25, 2002
between
WILMINGTON TRUST COMPANY
as Trustee,
and
CONTINENTAL AIRLINES, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of September 25, 1997
$194,522,000
Continental Airlines Pass Through Trust 2002-1G-2-O
6.563% Continental Airlines
Pass Through Certificates,
Series 2002-1G-2-O
TABLE OF CONTENTS
PAGE
ARTICLE I THE CERTIFICATES.....................................................2
Section 1.01. The Certificates...........................................2
ARTICLE II DEFINITIONS.........................................................4
Section 2.01. Definitions................................................4
ARTICLE III CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS...............................................10
Section 3.01. Statements to Applicable Certificateholders...............10
Section 3.02. Special Payments Account..................................12
Section 3.03. Distributions from Special Payments Account...............12
Section 3.04. Limitation of Liability for Payments......................14
ARTICLE IV DEFAULT............................................................14
Section 4.01. Purchase Rights of Certificateholders.....................14
Section 4.02. Amendment of Section 6.05 of the Basic Agreement..........18
ARTICLE V THE TRUSTEE.........................................................18
Section 5.01. Delivery of Documents; Delivery Dates.....................18
Section 5.02. Withdrawal of Deposits....................................20
Section 5.03. The Trustee...............................................20
Section 5.04. Representations and Warranties of the Trustee.............20
Section 5.05. Trustee Liens.............................................21
ARTICLE VI ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS......................21
Section 6.01. Amendment of Section 5.02 of the Basic Agreement..........21
Section 6.02. Supplemental Agreements Without Consent of Applicable
Certificateholders.......................................21
Section 6.03. Supplemental Agreements with Consent of Applicable
Certificateholders.......................................22
Section 6.04. Consent of Holders of Certificates Issued under
Other Trusts.............................................22
ARTICLE VII TERMINATION OF TRUST..............................................23
Section 7.01. Termination of the Applicable Trust.......................23
ARTICLE VIII MISCELLANEOUS PROVISIONS.........................................25
Section 8.01. Basic Agreement Ratified..................................25
Section 8.02. GOVERNING LAW.............................................25
Section 8.03. Execution in Counterparts.................................25
Section 8.04. Intention of Parties......................................25
Exhibit A - Form of Certificate
Exhibit B - DTC Letter of Representations
Exhibit C - Form of Assignment and Assumption Agreement
This Trust Supplement No. 2002-1G-2-O, dated as of March 25, 2002
(herein called the "TRUST SUPPLEMENT"), between Continental Airlines, Inc., a
Delaware corporation (the "COMPANY"), and Wilmington Trust Company (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein, capitalized
terms used herein without definition having the respective meanings specified in
the Basic Agreement) which may be issued thereunder, has heretofore been
executed and delivered;
WHEREAS, the Company has obtained commitments from Boeing for the
delivery of certain Aircraft;
WHEREAS, the Company intends to finance the acquisition of each such
Aircraft through separate secured loan transactions, under which the Company
will own such Aircraft (collectively, the "OWNED AIRCRAFT");
WHEREAS, in the case of each Owned Aircraft, the Company will issue
pursuant to an Indenture, on a recourse basis, Equipment Notes to finance a
portion of the purchase price of such Owned Aircraft;
WHEREAS, the Trustee hereby declares the creation of the Continental
Airlines Pass Through Trust 2002-1G-2-O (the "APPLICABLE TRUST") for the benefit
of the Applicable Certificateholders, and the initial Applicable
Certificateholders as the grantors of the Applicable Trust, by their respective
acceptances of the Applicable Certificates, join in the creation of the
Applicable Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Applicable Trust will
evidence fractional undivided interests in the Applicable Trust and will convey
no rights, benefits or interests in respect of any property other than the Trust
Property except for those Certificates to which an Escrow Receipt has been
affixed;
WHEREAS, the Escrow Agent and the Underwriters have
contemporaneously herewith entered into an Escrow Agreement with the Escrow
Paying Agent pursuant to which the Underwriters have delivered to the Escrow
Agent the proceeds from the sale of the Applicable Certificates, to the extent
not used to purchase Equipment Notes on the Issuance Date, and have irrevocably
instructed the Escrow Agent to withdraw and pay funds from such proceeds upon
request and proper certification by the Trustee to purchase Equipment Notes as
the Aircraft are delivered by Boeing under the Aircraft Purchase Agreement from
time to time prior to the Delivery Period Termination Date;
WHEREAS, the Escrow Agent on behalf of the Applicable
Certificateholders has contemporaneously herewith entered into a Deposit
Agreement with the Depositary under which the Deposits referred to therein will
be made and from which it will withdraw funds to allow the Trustee to purchase
Equipment Notes from time to time prior to the Delivery Period Termination Date;
WHEREAS, pursuant to the terms and conditions of the Basic Agreement
as supplemented by this Trust Supplement (the "AGREEMENT") and the NPA, upon the
financing of an Aircraft, the Trustee on behalf of the Applicable Trust, using
funds withdrawn under the Escrow Agreement (or, if financed on the Issuance
Date, using a portion of the proceeds of the sale of the Applicable
Certificates), shall purchase one or more Equipment Notes having the same
interest rate as, and final maturity date not later than the final Regular
Distribution Date of, the Applicable Certificates issued hereunder and shall
hold such Equipment Notes in trust for the benefit of the Applicable
Certificateholders;
WHEREAS, all of the conditions and requirements necessary to make
this Trust Supplement, when duly executed and delivered, a valid, binding and
legal instrument in accordance with its terms and for the purposes herein
expressed, have been done, performed and fulfilled, and the execution and
delivery of this Trust Supplement in the form and with the terms hereof have
been in all respects duly authorized;
WHEREAS, this Trust Supplement is subject to the provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. THE CERTIFICATES. There is hereby created a series of
Certificates to be issued under the Agreement to be distinguished and known as
"6.563% Continental Airlines Pass Through Certificates, Series 2002-1G-2-O"
(hereinafter defined as the "APPLICABLE CERTIFICATES"). Each Applicable
Certificate represents a fractional undivided interest in the Applicable Trust
created hereby. The Applicable Certificates shall be the only instruments
evidencing a fractional undivided interest in the Applicable Trust.
The terms and conditions applicable to the Applicable Certificates
are as follows:
(a) The aggregate principal amount of the Applicable Certificates
that shall be authenticated under the Agreement (except for Applicable
Certificates authenticated and delivered under Sections 3.03, 3.04, 3.05
and 3.06 of the Basic Agreement) is $194,522,000.
(b) The Regular Distribution Dates with respect to any payment of
Scheduled Payments means February 15, May 15, August 15 and November 15 of
each year, commencing on May 15, 2002, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been made.
(c) The Special Distribution Dates with respect to the Applicable
Certificates means any Business Day on which a Special Payment is to be
distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow Agreement, the
Trustee shall affix the corresponding Escrow Receipt to each Applicable
Certificate. In any event, any transfer or exchange of any Applicable
Certificate shall also effect a transfer or exchange of the related Escrow
Receipt. Prior to the Final Withdrawal Date, no transfer or exchange of
any Applicable Certificate shall be permitted unless the corresponding
Escrow Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an Escrow
Receipt is attached, each Holder of such an Applicable Certificate
acknowledges and accepts the restrictions on transfer of the Escrow
Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form attached
hereto as Exhibit A. Any Person acquiring or accepting an Applicable
Certificate or an interest therein will, by such acquisition or
acceptance, be deemed to represent and warrant to and for the benefit of
the Company that either (i) the assets of an employee benefit plan subject
to Title I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or of a plan subject to Section 4975 of the Internal
Revenue Code of 1986, as amended (the "CODE"), have not been used to
purchase Applicable Certificates or an interest therein or (ii) the
purchase and holding of Applicable Certificates or an interest therein is
exempt from the prohibited transaction restrictions of ERISA and the Code
pursuant to one or more prohibited transaction statutory or administrative
exemptions.
(ii) The Applicable Certificates shall be Book-Entry Certificates
and shall be subject to the conditions set forth in the Letter of
Representations between the Company and the Clearing Agency attached
hereto as Exhibit B.
(f) The "Participation Agreements" as defined in this Trust
Supplement are the "Note Purchase Agreements" referred to in the Basic
Agreement.
(g) The Applicable Certificates are subject to the Intercreditor
Agreement, the Deposit Agreement and the Escrow Agreement.
(h) The Applicable Certificates are entitled to the benefits of the
Primary Liquidity Facility and the Policy.
(i) The Responsible Party is the Company.
(j) The date referred to in clause (i) of the definition of the term
"PTC Event of Default" in the Basic Agreement is the Final Maturity Date.
(k) The "particular sections of the Note Purchase Agreement", for
purposes of clause (3) of Section 7.07 of the Basic Agreement, are Section
8.1 of each Participation Agreement.
(l) The Equipment Notes to be acquired and held in the Applicable
Trust, and the related Aircraft and Note Documents, are described in the
NPA.
ARTICLE II
DEFINITIONS
Section 2.01. DEFINITIONS. For all purposes of the Basic Agreement
as supplemented by this Trust Supplement, the following capitalized terms have
the following meanings (any term used herein which is defined in both this Trust
Supplement and the Basic Agreement shall have the meaning assigned thereto in
this Trust Supplement for purposes of the Basic Agreement as supplemented by
this Trust Supplement):
AGREEMENT: Has the meaning specified in the recitals hereto.
AIRCRAFT: Means each of the New Aircraft or Substitute Aircraft in
respect of which a Participation Agreement is to be or is, as the case may
be, entered into in accordance with the NPA (or any substitute aircraft,
including engines therefor, owned by the Company and securing one or more
Equipment Notes).
AIRCRAFT PURCHASE AGREEMENT: Has the meaning specified in the NPA.
APPLICABLE CERTIFICATE: Has the meaning specified in Section 1.01 of
this Trust Supplement.
APPLICABLE CERTIFICATEHOLDER: Means the Person in whose name an
Applicable Certificate is registered on the Register for the Applicable
Certificates.
APPLICABLE DELIVERY DATE: Has the meaning specified in Section
5.01(b) of this Trust Supplement.
APPLICABLE PARTICIPATION AGREEMENT: Has the meaning specified in
Section 5.01(b) of this Trust Supplement.
APPLICABLE TRUST: Has the meaning specified in the recitals hereto.
ASSIGNMENT AND ASSUMPTION AGREEMENT: Means the assignment and
assumption agreement substantially in the form of Exhibit C hereto
executed and delivered in accordance with Section 7.01 of this Trust
Supplement.
BASIC AGREEMENT: Has the meaning specified in the first paragraph of
this Trust Supplement.
BOEING: Means The Boeing Company.
BUSINESS DAY: Means any day other than a Saturday, a Sunday or a day
on which commercial banks are required or authorized to close in Houston,
Texas, New York, New York, or, so long as any Applicable Certificate is
Outstanding, the city and state in which the Trustee, the Subordination
Agent or any Loan Trustee maintains its Corporate Trust Office or receives
and disburses funds, and, if any Series G-1 Equipment Notes (as defined in
the Intercreditor Agreement) or Series H Equipment Notes (as defined in
the Intercreditor Agreement) are outstanding, which is also a day for
trading by and between banks in the London interbank Eurodollar market.
CERTIFICATE: Has the meaning specified in the Intercreditor
Agreement.
CLASS: Has the meaning specified in the Intercreditor Agreement.
COMPANY: Has the meaning specified in the first paragraph of this
Trust Supplement.
CONTROLLING PARTY: Has the meaning specified in the Intercreditor
Agreement.
CUT-OFF DATE: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event occurs.
DELIVERY NOTICE: Has the meaning specified in the NPA.
DELIVERY PERIOD TERMINATION DATE: Means the earlier of (a) August
31, 2002, or, if the Equipment Notes relating to all of the New Aircraft
(or Substitute Aircraft in lieu thereof) have not been purchased by the
Applicable Trust and the Other Trusts on or prior to such date due to any
reason beyond the control of the Company and not occasioned by the
Company's fault or negligence, November 30, 2002 (PROVIDED that, if a
labor strike occurs at Boeing on or prior to either or both of such dates
referred to in this clause (a), such date or dates on or following the
commencement of such strike shall be extended by adding thereto the number
of days that such strike continued in effect), and (b) the date on which
Equipment Notes issued with respect to all of the New Aircraft (or
Substitute Aircraft in lieu thereof) have been purchased by the Applicable
Trust and the Other Trusts in accordance with the NPA.
DEPOSIT AGREEMENT: Means the Deposit Agreement dated as of March 25,
2002 relating to the Applicable Certificates between the Depositary and
the Escrow Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
DEPOSIT MAKE-WHOLE PREMIUM: Has the meaning specified in the NPA.
DEPOSITARY: Means Credit Suisse First Boston, a banking institution
organized under the laws of Switzerland, acting through its New York
branch.
DEPOSITS: Has the meaning specified in the Deposit Agreement.
DISTRIBUTION DATE: Means any Regular Distribution Date or Special
Distribution Date as the context requires.
ESCROW AGENT: Means, initially, Wells Fargo Bank Northwest, National
Association, and any replacement or successor therefor appointed in
accordance with the Escrow Agreement.
ESCROW AGREEMENT: Means the Escrow and Paying Agent Agreement dated
as of March 25, 2002 relating to the Applicable Certificates, among the
Escrow Agent, the Escrow Paying Agent, the Trustee and Underwriters, as
the same may be amended, supplemented or otherwise modified from time to
time in accordance with its terms.
ESCROW PAYING AGENT: Means the Person acting as paying agent under
the Escrow Agreement.
ESCROW RECEIPT: Means the receipt substantially in the form annexed
to the Escrow Agreement representing a fractional undivided interest in
the funds held in escrow thereunder.
FINAL MATURITY DATE: Means August 15, 2013.
FINAL WITHDRAWAL: Has the meaning specified in the Escrow Agreement.
FINAL WITHDRAWAL DATE: Has the meaning specified in the Escrow
Agreement.
FINAL WITHDRAWAL NOTICE: Has the meaning specified in Section 5.02
of this Trust Supplement.
INDENTURE: Means each of the separate trust indentures and mortgages
relating to the Aircraft, each as specified or described in a Delivery
Notice delivered pursuant to the NPA or the related Participation
Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.
INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as
of March 25, 2002 among the Trustee, the Other Trustees, the Primary
Liquidity Provider, the primary liquidity provider and the above-cap
liquidity provider relating to the Class G-1 Certificates, the Policy
Provider and Wilmington Trust Company, as Subordination Agent and as
trustee thereunder, as amended, supplemented or otherwise modified from
time to time in accordance with its terms.
INVESTORS: Means the Underwriters, together with all subsequent
beneficial owners of the Applicable Certificates.
MAKE-WHOLE AMOUNT: Has the meaning specified in the Indentures.
NEW AIRCRAFT: Has the meaning specified in the NPA.
NOTE DOCUMENTS: Means the Equipment Notes with respect to the
Applicable Certificates and, with respect to any such Equipment Note, the
Indenture and the Participation Agreement relating to such Equipment Note.
NOTICE OF PURCHASE WITHDRAWAL: Has the meaning specified in the
Deposit Agreement.
NPA: Means the Note Purchase Agreement dated as of March 25, 2002
among the Trustee, the Other Trustees, the Company, the Escrow Agent, the
Escrow Paying Agent and the Subordination Agent, providing for, among
other things, the purchase of Equipment Notes by the Trustee on behalf of
the Trust, as the same may be amended, supplemented or otherwise modified
from time to time, in accordance with its terms.
OTHER AGREEMENTS: Means (i) the Basic Agreement as supplemented by
Trust Supplement No. 2002-1G-1-O dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1G-1-O, (ii) the Basic
Agreement as supplemented by Trust Supplement No. 2002-1H-O dated as of
the date hereof relating to Continental Airlines Pass Through Trust
2002-1H-O and (iii) the Basic Agreement as supplemented by Trust
Supplement No. 2002-1I-O dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1I-O.
OTHER TRUSTEES: Means the trustees under the Other Agreements, and
any successor or other trustee appointed as provided therein.
OTHER TRUSTS: Means the Continental Airlines Pass Through Trust
2002-1G-1-O, the Continental Airlines Pass Through Trust 2002-1H-O and the
Continental Airlines Pass Through Trust 2002-1I-O, created by the Other
Agreements.
OWNED AIRCRAFT: Has the meaning specified in the third recital to
this Trust Supplement.
PARTICIPATION AGREEMENT: Means each Participation Agreement to be
entered into, or entered into (as the case may be), by the Trustee
pursuant to the NPA, as the same may be amended, supplemented or otherwise
modified in accordance with its terms.
POLICY: Means, with respect to the Applicable Certificates, Ambac
Certificate Guarantee Insurance Policy No. AB0543BE, together with the
Certificate Guaranty Insurance Policy Endorsement attached thereto, issued
as of the Closing Date, as amended, supplemented or otherwise modified
from time to time in accordance with its terms.
POLICY PROVIDER: Has the meaning specified in the Intercreditor
Agreement.
POLICY PROVIDER AGREEMENT: Has the meaning specified in the
Intercreditor Agreement.
POLICY PROVIDER DEFAULT: Has the meaning specified in the
Intercreditor Agreement.
POOL BALANCE: Means, as of any date, (i) the original aggregate face
amount of the Applicable Certificates less (ii) the aggregate amount of
all payments made as of such date in respect of such Applicable
Certificates or in respect of Deposits other than payments made in respect
of interest or premium, Make-Whole Amount or Deposit Make-Whole Premium
thereon or reimbursement of any costs or expenses incurred in connection
therewith. The Pool Balance as of any date shall be computed after giving
effect to any special distribution with respect to unused Deposits,
payment of principal of the Equipment Notes, payments under the Policy
(other than in respect of interest on the Applicable Certificates) or
payment with respect to other Trust Property and the distribution thereof
to be made on that date.
POOL FACTOR: Means, as of any Distribution Date, the quotient
(rounded to the seventh decimal place) computed by dividing (i) the Pool
Balance by (ii) the original aggregate face amount of the Applicable
Certificates. The Pool Factor as of any Distribution Date shall be
computed after giving effect to any special distribution with respect to
unused Deposits, payment of principal of the Equipment Notes, payment
under the Policy (other than in respect of interest on the Applicable
Certificates) or payment with respect to other Trust Property and the
distribution thereof to be made on that date.
PRIMARY LIQUIDITY FACILITY: Means, initially, the Revolving Credit
Agreement dated as of March 25, 2002 relating to the Applicable
Certificates, between the Primary Liquidity Provider and Wilmington Trust
Company, as Subordination Agent, as agent and trustee for the Applicable
Trust, and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement primary liquidity facility
therefor, in each case as amended, supplemented or otherwise modified from
time to time in accordance with their respective terms.
PRIMARY LIQUIDITY PROVIDER: Means, initially, Landesbank
Hessen-Thuringen Girozentrale, a German public law institution duly
established under the Treaty on the Formation of a Joint Savings Banks
Organization Hessen-Thuringen, and any replacements or successors therefor
appointed in accordance with the Intercreditor Agreement.
PROSPECTUS SUPPLEMENT: Means the final Prospectus Supplement dated
March 11, 2002 relating to the offering of the Applicable Certificates and
the Class G-1 Certificates.
RATINGS CONFIRMATION: Has the meaning specified in the Intercreditor
Agreement.
REFERENCE AGENCY AGREEMENT: Has the meaning specified in the NPA.
RELATED PASS THROUGH TRUST AGREEMENT: Means the Basic Agreement as
supplemented by the Trust Supplement No. 2002-1G-2-S dated as of the date
hereof relating to the Continental Airlines Pass Through Trust 2002-1G-2-S
and entered into by the Company and the Trustee, which agreement becomes
effective upon the execution and delivery of the Assignment and Assumption
Agreement pursuant to Section 7.01 of this Trust Supplement.
RELATED TRUST: Means the Continental Pass Through Trust 2002-1G-2-S,
to be formed under the Related Pass Through Trust Agreement.
RELATED TRUSTEE: Means the trustee under the Related Pass Through
Trust Agreement.
SCHEDULED DELIVERY DATE: Has the meaning specified in the NPA.
SCHEDULED PAYMENT: Means, with respect to any Equipment Note, (i)
any payment of principal or interest on such Equipment Note (other than
any such payment which is not in fact received by the Trustee or any
Subordination Agent within five days of the date on which such payment is
scheduled to be made) or (ii) any payment of interest on the Applicable
Certificates with funds drawn under the Primary Liquidity Facility or any
payment of interest on or principal of the Applicable Certificates with
funds drawn under the Policy, which payment in any such case represents
the installment of principal on such Equipment Note at the stated maturity
of such installment, the payment of regularly scheduled interest accrued
on the unpaid principal amount of such Equipment Note, or both; PROVIDED,
HOWEVER, that any payment of principal, premium, Make-Whole Amount or
Deposit Make-Whole Premium, if any, or interest resulting from the
redemption or purchase of any Equipment Note shall not constitute a
Scheduled Payment.
SPECIAL PAYMENT: Means any payment (other than a Scheduled Payment)
in respect of, or any proceeds of, any Equipment Note, Collateral (as
defined in each Indenture) or Deposit Make-Whole Premium.
SUBSTITUTE AIRCRAFT: Has the meaning specified in the NPA.
TRANSFER DATE: Has the meaning specified in Section 7.01 of this
Trust Supplement.
TRIGGERING EVENT: Has the meaning assigned to such term in the
Intercreditor Agreement.
TRUST PROPERTY: Means (i) subject to the Intercreditor Agreement,
the Equipment Notes held as the property of the Applicable Trust, all
monies at any time paid thereon and all monies due and to become due
thereunder, (ii) funds from time to time deposited in the Certificate
Account and the Special Payments Account and, subject to the Intercreditor
Agreement, any proceeds from the sale by the Trustee pursuant to Article
VI of the Basic Agreement of any Equipment Note and (iii) all rights of
the Applicable Trust and the Trustee, on behalf of the Applicable Trust,
under the Intercreditor Agreement, the Escrow Agreement, the NPA, the
Primary Liquidity Facility and the Policy, including, without limitation,
all rights to receive certain payments thereunder, and all monies paid to
the Trustee on behalf of the Applicable Trust pursuant to the
Intercreditor Agreement, the Primary Liquidity Facility or the Policy,
PROVIDED that rights with respect to the Deposits or under the Escrow
Agreement, except for the right to direct withdrawals for the purchase of
Equipment Notes to be held herein, will not constitute Trust Property.
TRUST SUPPLEMENT: Has the meaning specified in the first paragraph
of this trust supplement.
TRUSTEE: Has the meaning specified in the first paragraph of this
Trust Supplement.
UNDERWRITERS: Means, collectively, Credit Suisse First Boston
Corporation, J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Salomon Smith Barney Inc. and Morgan Stanley & Co.
Incorporated.
UNDERWRITING AGREEMENT: Means the Underwriting Agreement dated March
11, 2002 among the Underwriters, the Company and the Depositary, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
ARTICLE III
CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. STATEMENTS TO APPLICABLE CERTIFICATEHOLDERS. (a) On
each Distribution Date, the Trustee will include with each distribution to
Applicable Certificateholders of a Scheduled Payment or Special Payment, as the
case may be, a statement setting forth the information provided below (in the
case of a Special Payment, reflecting in part the information provided by the
Escrow Paying Agent under the Escrow Agreement). Such statement shall set forth
(per $1,000 face amount Applicable Certificate as to (ii), (iii), (iv) and (v)
below) the following information:
(i) the aggregate amount of funds distributed on such Distribution
Date under the Agreement and under the Escrow Agreement, indicating the
amount allocable to each source, including any portion thereof paid by the
Primary Liquidity Provider or the Policy Provider;
(ii) the amount of such distribution under the Agreement allocable
to principal and the amount allocable to premium, Make-Whole Amount or
Deposit Make-Whole Premium, if any;
(iii) the amount of such distribution under the Agreement allocable
to interest;
(iv) the amount of such distribution under the Escrow Agreement
allocable to interest;
(v) the amount of such distribution under the Escrow Agreement
allocable to unused Deposits, if any; and
(vi) the Pool Balance and the Pool Factor.
With respect to the Applicable Certificates registered in the name
of a Clearing Agency, on the Record Date prior to each Distribution Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such Record Date. On each Distribution Date, the Trustee will mail to each such
Clearing Agency Participant the statement described above and will make
available additional copies as requested by such Clearing Agency Participant for
forwarding to holders of interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was an
Applicable Certificateholder of record a statement containing the sum of the
amounts determined pursuant to clauses (a)(i), (a)(ii), (a)(iii), (a)(iv) and
(a)(v) above for such calendar year or, in the event such Person was an
Applicable Certificateholder of record during a portion of such calendar year,
for such portion of such year, and such other items as are readily available to
the Trustee and which an Applicable Certificateholder shall reasonably request
as necessary for the purpose of such Applicable Certificateholder's preparation
of its U.S. federal income tax returns. Such statement and such other items
shall be prepared on the basis of information supplied to the Trustee by the
Clearing Agency Participants and shall be delivered by the Trustee to such
Clearing Agency Participants to be available for forwarding by such Clearing
Agency Participants to the holders of interests in the Applicable Certificates
in the manner described in Section 3.01(a) of this Trust Supplement.
(c) If the aggregate principal payments scheduled for a Regular
Distribution Date prior to the Delivery Period Termination Date differ from the
amount thereof set forth for the Applicable Certificates on page S-42 of the
Prospectus Supplement, by no later than the 15th day prior to such Regular
Distribution Date, the Trustee shall mail written notice of the actual amount of
such scheduled payments to the Applicable Certificateholders of record as of a
date within 15 Business Days prior to the date of mailing.
(d) Promptly following (i) the Delivery Period Termination Date, if
there has been any change in the information set forth in clauses (y) and (z)
below from that set forth in page S-42 of the Prospectus Supplement, and (ii)
the date of any early redemption or purchase of, or any default in the payment
of principal or interest in respect of, any of the Equipment Notes held in the
Applicable Trust, or any Final Withdrawal, the Trustee shall furnish to
Applicable Certificateholders of record on such date a statement setting forth
(x) the expected Pool Balances for each subsequent Regular Distribution Date
following the Delivery Period Termination Date, (y) the related Pool Factors for
such Regular Distribution Dates and (z) the expected principal distribution
schedule of the Equipment Notes, in the aggregate, held as Trust Property at the
date of such notice. With respect to the Applicable Certificates registered in
the name of a Clearing Agency, on the Delivery Period Termination Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such date. The Trustee will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as requested
by such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(e) This Section 3.01 supersedes and replaces Section 4.03 of the
Basic Agreement, with respect to the Applicable Trust.
Section 3.02. SPECIAL PAYMENTS ACCOUNT. (a) The Trustee shall
establish and maintain on behalf of the Applicable Certificateholders a Special
Payments Account as one or more accounts, which shall be non-interest bearing
except as provided in Section 4.04 of the Basic Agreement. The Trustee shall
hold the Special Payments Account in trust for the benefit of the Applicable
Certificateholders and shall make or permit withdrawals therefrom only as
provided in the Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement and upon the payment of
the Deposit Make-Whole Premium to the Trustee under the NPA, the Trustee, upon
receipt thereof, shall immediately deposit the aggregate amount of such Special
Payments in the Special Payments Account.
(b) This Section 3.02 supersedes and replaces Section 4.01(b) of the
Basic Agreement in its entirety, with respect to the Applicable Trust.
Section 3.03. DISTRIBUTIONS FROM SPECIAL PAYMENTS ACCOUNT. (a) On
each Special Distribution Date with respect to any Special Payment or as soon
thereafter as the Trustee has confirmed receipt of any Special Payments due on
the Equipment Notes held (subject to the Intercreditor Agreement) in the
Applicable Trust or realized upon the sale of such Equipment Notes or receipt of
the Deposit Make-Whole Premium, the Trustee shall distribute out of the Special
Payments Account the entire amount of such Special Payment deposited therein
pursuant to Section 3.02(a) of this Trust Supplement. There shall be so
distributed to each Applicable Certificateholder of record on the Record Date
with respect to such Special Distribution Date (other than as provided in
Section 7.01 of this Trust Supplement concerning the final distribution) by
check mailed to such Applicable Certificateholder, at the address appearing in
the Register, such Applicable Certificateholder's pro rata share (based on the
Fractional Undivided Interest in the Applicable Trust held by such Applicable
Certificateholder) of the total amount in the Special Payments Account on
account of such Special Payment, except that, with respect to Applicable
Certificates registered on the Record Date in the name of a Clearing Agency (or
its nominee), such distribution shall be made by wire transfer in immediately
available funds to the account designated by such Clearing Agency (or such
nominee).
(b) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Applicable Certificateholder at his
address as it appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the Applicable Trust, such notice shall be mailed not
less than 15 days prior to the Special Distribution Date for the Special Payment
resulting from such redemption or purchase, which Special Distribution Date
shall be the date of such redemption or purchase. In the case of any
distribution pursuant to Section 3.7(c) or Section 3.7(e) of the Intercreditor
Agreement, the Trustee will mail notice to the Applicable Certificateholders not
less than 15 days prior to the Special Distribution Date determined for such
distribution. In the event of the payment of a Deposit Make-Whole Premium by the
Company to the Trustee under the NPA, such notice shall be mailed, together with
the notice by the Escrow Paying Agent under Section 2.07 of the Escrow
Agreement, not less than 15 days prior to the Special Distribution Date for such
amount. In the case of any other Special Payments, such notice shall be mailed
as soon as practicable after the Trustee has confirmed that it has received
funds for such Special Payment, stating the Special Distribution Date for such
Special Payment which shall occur not less than 15 days after the date of such
notice and as soon as practicable thereafter. Notices mailed by the Trustee
shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 7.01 of this Trust Supplement),
(ii) the amount of the Special Payment for each $1,000 face amount
Applicable Certificate and the amount thereof constituting principal,
premium, Make-Whole Amount or Deposit Make-Whole Premium, if any, and
interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date, the total amount to be received on such date for each
$1,000 face amount Applicable Certificate.
If the amount of (i) premium or Make-Whole Amount, if any, payable upon the
redemption or purchase of an Equipment Note or (ii) the Deposit Make-Whole
Premium, if any, has not been calculated at the time that the Trustee mails
notice of a Special Payment, it shall be sufficient if the notice sets forth the
other amounts to be distributed and states that any premium, Make-Whole Amount
or Deposit Make-Whole Premium received will also be distributed.
If any redemption of the Equipment Notes held in the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Applicable Certificateholder at its address
as it appears on the Register.
(b) This Section 3.03 supersedes and replaces Section 4.02(b) and
Section 4.02(c) of the Basic Agreement in their entirety, with respect to the
Applicable Trust.
Section 3.04. LIMITATION OF LIABILITY FOR PAYMENTS. Section 3.09 of
the Basic Agreement shall be amended, with respect to the Applicable Trust, by
deleting the phrase "the Owner Trustees or the Owner Participants" in the second
sentence thereof and adding in lieu thereof " the Primary Liquidity Provider or
the Policy Provider".
ARTICLE IV
DEFAULT
Section 4.01. PURCHASE RIGHTS OF CERTIFICATEHOLDERS. (a) At any time
after the occurrence and during the continuation of a Triggering Event, if the
Class G-1 Trustee is then the Controlling Party, each Applicable
Certificateholder (other than the Company or any of its Affiliates) shall have
the right to purchase, for the purchase price set forth in the Class G-1 Trust
Agreement, all, but not less than all, of the Class G-1 Certificates upon ten
days' written notice to the Class G-1 Trustee and each other Applicable
Certificateholder, PROVIDED that (i) if prior to the end of such ten-day period
any other Applicable Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Applicable Certificateholder that such
other Applicable Certificateholder wants to participate in such purchase, then
such other Applicable Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Applicable Certificateholder to
purchase all, but not less than all, of the Class G-1 Certificates pro rata
based on the Fractional Undivided Interest in the Applicable Trust held by each
such Applicable Certificateholder and (ii) if prior to the end of such ten-day
period any other Applicable Certificateholder fails to notify the purchasing
Applicable Certificateholder of such other Applicable Certificateholder's desire
to participate in such a purchase, then such other Applicable Certificateholder
shall lose its right to purchase the Class G-1 Certificates pursuant to this
Section 4.01(a).
(b) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after the occurrence and during the
continuation of a Triggering Event,
(i) if the Trustee is then the Controlling Party, each Class G-1
Certificateholder (other than the Company or any of its Affiliates) shall
have the right to purchase all, but not less than all, of the Applicable
Certificates upon ten days' written notice to the Trustee and each other
Class G-1 Certificateholder, PROVIDED that (A) if prior to the end of such
ten-day period any other Class G-1 Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Class G-1
Certificateholder that such other Class G-1 Certificateholder wants to
participate in such purchase, then such other Class G-1 Certificateholder
(other than the Company or any of its Affiliates) may join with the
purchasing Class G-1 Certificateholder to purchase all, but not less than
all, of the Applicable Certificates pro rata based on the Fractional
Undivided Interest in the Class G-1 Trust held by each such Class G-1
Certificateholder and (B) if prior to the end of such ten-day period any
other Class G-1 Certificateholder fails to notify the purchasing Class G-1
Certificateholder of such other Class G-1 Certificateholder's desire to
participate in such a purchase, then such other Class G-1
Certificateholder shall lose its right to purchase the Applicable
Certificates pursuant to this Section 4.01(b)(i);
(ii) each Class H Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a) or (b)(i)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice
to the Trustee, the Class G-1 Trustee and each other Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Class H Certificateholder (other than the Company or any
of its Affiliates) notifies such purchasing Class H Certificateholder that
such other Class H Certificateholder wants to participate in such
purchase, then such other Class H Certificateholder (other than the
Company or any of its Affiliates) may join with the purchasing Class H
Certificateholder to purchase all, but not less than all, of the
Applicable Certificates and the Class G-1 Certificates pro rata based on
the Fractional Undivided Interest in the Class H Trust held by each such
Class H Certificateholder and (B) if prior to the end of such ten-day
period any other Class H Certificateholder fails to notify the purchasing
Class H Certificateholder of such other Class H Certificateholder's desire
to participate in such a purchase, then such other Class H
Certificateholder shall lose its right to purchase the Applicable
Certificates and the Class G-1 Certificates pursuant to this Section
4.01(b)(ii);
(iii) if Re-Issued Class H Certificates are issued, each Re-Issued
Class H Certificateholder (other than the Company or any of its
Affiliates) shall have the right (which shall not expire upon any purchase
of the Applicable Certificates pursuant to clause (a), (b)(i) or (b)(ii)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice
to the Trustee, the Class G-1 Trustee and each other Re-Issued Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Re-Issued Class H Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Re-Issued Class
H Certificateholder that such other Re-Issued Class H Certificateholder
wants to participate in such purchase, then such other Re-Issued Class H
Certificateholder (other than the Company or any of its Affiliates) may
join with the purchasing Re-Issued Class H Certificateholder to purchase
all, but not less than all, of the Applicable Certificates and the Class
G-1 Certificates pro rata based on the Fractional Undivided Interest in
the Re-Issued Class H Trust held by each such Re-Issued Class H
Certificateholder and (B) if prior to the end of such ten-day period any
other Re-Issued Class H Certificateholder fails to notify the purchasing
Re-Issued Class H Certificateholder of such other Re-Issued Class H
Certificateholder's desire to participate in such a purchase, then such
other Re-Issued Class H Certificateholder shall lose its right to purchase
the Applicable Certificates and the Class G-1 Certificates pursuant to
this Section 4.01(b)(iii);
(iv) each Class I Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii) or (b)(iii) above) to purchase all, but not less than all, of the
Applicable Certificates, the Class G-1 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) upon ten
days' written notice to the Trustee, the Class G-1 Trustee, the Class H
Trustee (or, if any Re-Issued Class H Certificates have been issued, the
Re-Issued Class H Trustee) and each other Class I Certificateholder,
PROVIDED that (A) if prior to the end of such ten-day period any other
Class I Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Class I Certificateholder that such
other Class I Certificateholder wants to participate in such purchase,
then such other Class I Certificateholder (other than the Company or any
of its Affiliates) may join with the purchasing Class I Certificateholder
to purchase all, but not less than all, of the Applicable Certificates,
the Class G-1 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) pro rata based on the Fractional Undivided
Interest in the Class I Trust held by each such Class I Certificateholder
and (B) if prior to the end of such ten-day period any other Class I
Certificateholder fails to notify the purchasing Class I Certificateholder
of such other Class I Certificateholder's desire to participate in such a
purchase, then such other Class I Certificateholder shall lose its right
to purchase the Applicable Certificates, the Class G-1 Certificates, the
Class H Certificates (or, if issued, the Re-Issued Class H Certificates)
pursuant to this Section 4.01(b)(iv); and
(v) each Class J Certificateholder, other than the Company or any of
its Affiliates, shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii), (b)(iii) or (b)(iv) above) to purchase all, but not less than
all, of the Applicable Certificates, the Class G-1 Certificates, the Class
H Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates upon ten days' written notice to the Trustee, the
Class G-1 Trustee, the Class H Trustee (or, if any Re-Issued Class H
Certificates have been issued, the Re-Issued Class H Trustee), the Class I
Trustee and each other Class J Certificateholder, PROVIDED that (A) if
prior to the end of such ten-day period any other Class J
Certificateholder (other than the Company or any of its Affiliates)
notifies such purchasing Class J Certificateholder that such other Class J
Certificateholder wants to participate in such purchase, then such other
Class J Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Class J Certificateholder to
purchase all, but not less than all, of the Applicable Certificates, the
Class G-1 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) and the Class I Certificates pro rata
based on the Fractional Undivided Interest in the Class J Trust held by
each such Class J Certificateholder and (B) if prior to the end of such
ten-day period any other Class J Certificateholder fails to notify the
purchasing Class J Certificateholder of such other Class J
Certificateholder's desire to participate in such a purchase, then such
other Class J Certificateholder shall lose its right to purchase the
Applicable Certificates, the Class G-1 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates pursuant to this Section 4.01(b)(v).
(c) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after 180 days have elapsed since the
occurrence of a Triggering Event that is continuing, regardless of whether the
Applicable Certificateholders exercise their right to purchase the Class G-1
Certificates pursuant to Section 4.01(a), the Policy Provider, if it is then the
Controlling Party, shall have the right (except in the event of a Policy
Provider Default) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice to the
Trustee, the Class G-1 Trustee, the Applicable Certificateholders and the Class
G-1 Certificateholders.
The purchase price with respect to the Applicable Certificates shall
be equal to the Pool Balance of the Applicable Certificates, together with
accrued and unpaid interest thereon to the date of such purchase, without
premium, but including any other amounts then due and payable to the Applicable
Certificateholders under the Agreement, the Intercreditor Agreement, the Escrow
Agreement or any Note Document or on or in respect of the Applicable
Certificates; PROVIDED, HOWEVER, that no such purchase of Applicable
Certificates shall be effective unless the purchaser(s) shall certify to the
Trustee that contemporaneously with such purchase, such purchaser(s) is (are)
purchasing, pursuant to the terms of the Agreement and the Other Agreements
(and, if any Re-Issued Class H Certificates have been issued, the pass through
trust agreement relating thereto), (A) in the case of any purchase of the
Applicable Certificates pursuant to clause (b)(i) above, all of the Applicable
Certificates, (B) in the case of any purchase of the Applicable Certificates
pursuant to clause (c) above, all of the Applicable Certificates and the Class
G-1 Certificates, or (C) in all other cases, the Applicable Certificates, the
Class G-1 Certificates, the Class H Certificates (or, if issued, the Re-Issued
Class H Certificates) and the Class I Certificates that are senior to the
securities held by such purchaser(s). Each payment of the purchase price of the
Applicable Certificates referred to in the first sentence hereof shall be made
to an account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01. Each Applicable Certificateholder
agrees by its acceptance of its Applicable Certificate that (at any time after
the occurrence and during the continuation of a Triggering Event) it will, upon
payment from such Class G-1 Certificateholder(s), Class H Certificateholder(s)
(or, if any Re-Issued Class H Certificates have been issued, Re-Issued Class H
Certificateholder(s)), Class I Certificateholder(s), Class J
Certificateholder(s) or the Policy Provider, as the case may be, of the purchase
price set forth in the first sentence of this paragraph, (i) forthwith sell,
assign, transfer and convey to the purchaser(s) thereof (without recourse,
representation or warranty of any kind except for its own acts), all of the
right, title, interest and obligation of such Applicable Certificateholder in
the Agreement, the Escrow Agreement, the Deposit Agreement, the Intercreditor
Agreement, the Primary Liquidity Facility, the Policy, the NPA, the Note
Documents and all Applicable Certificates and Escrow Receipts held by such
Applicable Certificateholder (excluding all right, title and interest under any
of the foregoing to the extent such right, title or interest is with respect to
an obligation not then due and payable as respects any action or inaction or
state of affairs occurring prior to such sale) (and the purchaser shall assume
all of such Applicable Certificateholder's obligations under the Agreement, the
Escrow Agreement, the Deposit Agreement, the Intercreditor Agreement, the
Primary Liquidity Facility, the Policy, the NPA, the Note Documents and all such
Applicable Certificates and Escrow Receipts), (ii) if such purchase occurs after
a record date specified in Section 2.03 of the Escrow Agreement relating to the
distribution of unused Deposits and/or accrued and unpaid interest on Deposits
and prior to or on the related distribution date thereunder, forthwith turn over
to the purchaser(s) of its Applicable Certificate all amounts, if any, received
by it on account of such distribution, and (iii) if such purchase occurs after a
Record Date relating to any distribution and prior to or on the related
Distribution Date, forthwith turn over to the purchaser(s) of its Applicable
Certificate all amounts, if any, received by it on account of such distribution.
The Applicable Certificates will be deemed to be purchased on the date payment
of the purchase price is made notwithstanding the failure of the Applicable
Certificateholders to deliver any Applicable Certificates and, upon such a
purchase, (I) the only rights of the Applicable Certificateholders will be to
deliver the Applicable Certificates to the purchaser(s) and receive the purchase
price for such Applicable Certificates and (II) if the purchaser(s) shall so
request, such Applicable Certificateholder will comply with all the provisions
of Section 3.04 of the Basic Agreement to enable new Applicable Certificates to
be issued to the purchaser in such denominations as it shall request. All
charges and expenses in connection with the issuance of any such new Applicable
Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01 and elsewhere in this Trust Supplement,
the terms "Class G-1 Certificate", "Class G-1 Certificateholder", "Class G-1
Trust", "Class G-1 Trust Agreement", "Class G-1 Trustee", "Class H Certificate",
"Class H Certificateholder", "Class H Trust", "Class H Trustee", "Class I
Certificate", "Class I Certificateholder", "Class I Trust", "Class I Trustee",
"Class J Certificate", "Class J Certificateholder", "Class J Trust", "Re-Issued
Class H Certificate", "Re-Issued Class H Certificateholder", "Re-Issued Class H
Trust" and "Re-Issued Class H Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(d) This Section 4.01 supersedes and replaces Section 6.01(b) of the
Basic Agreement, with respect to the Applicable Trust.
Section 4.02. AMENDMENT OF SECTION 6.05 OF THE BASIC AGREEMENT.
Section 6.05 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by deleting the phrase "and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto," set forth in the first sentence thereof.
ARTICLE V
THE TRUSTEE
Section 5.01. DELIVERY OF DOCUMENTS; DELIVERY DATES. (a) The Trustee
is hereby directed (i) to execute and deliver the Intercreditor Agreement, the
Escrow Agreement and the NPA on or prior to the Issuance Date, each in the form
delivered to the Trustee by the Company, and (ii) subject to the respective
terms thereof, to perform its obligations thereunder. Upon request of the
Company and the satisfaction or waiver of the closing conditions specified in
the Underwriting Agreement, the Trustee shall execute, deliver, authenticate,
issue and sell Applicable Certificates in authorized denominations equaling in
the aggregate the amount set forth, with respect to the Applicable Trust, in
Schedule I to the Underwriting Agreement evidencing the entire ownership
interest in the Applicable Trust, which amount equals the maximum aggregate
principal amount of Equipment Notes which may be purchased by the Trustee
pursuant to the NPA. Except as provided in Sections 3.03, 3.04, 3.05 and 3.06 of
the Basic Agreement, the Trustee shall not execute, authenticate or deliver
Applicable Certificates in excess of the aggregate amount specified in this
paragraph. The provisions of this Section 5.01(a) supersede and replace the
first sentence of Section 3.02(a) of the Basic Agreement, with respect to the
Applicable Trust.
(b) On or after the Issuance Date, the Company may deliver from time
to time to the Trustee a Delivery Notice relating to one or more Equipment
Notes. After receipt of a Delivery Notice and in any case no later than one
Business Day prior to a Scheduled Delivery Date as to which such Delivery Notice
relates (the "APPLICABLE DELIVERY DATE"), the Trustee shall (as and when
specified in the Delivery Notice) instruct the Escrow Agent to provide a Notice
of Purchase Withdrawal to the Depositary requesting (A) the withdrawal of one or
more Deposits on the Applicable Delivery Date in accordance with and to the
extent permitted by the terms of the Escrow Agreement and the Deposit Agreement
and (B) the payment of all, or a portion, of such Deposit or Deposits in an
amount equal in the aggregate to the purchase price of such Equipment Notes to
or on behalf of the Company, all as shall be described in the Delivery Notice;
PROVIDED that, if the Issuance Date is an Applicable Delivery Date, the Trustee
shall not so instruct the Escrow Agent, and the purchase price of such Equipment
Notes shall be paid from a portion of the proceeds of the sale of the Applicable
Certificates. The Trustee shall (as and when specified in such Delivery Notice),
subject to the conditions set forth in Section 2 of the NPA, enter into and
perform its obligations under the Participation Agreement specified in such
Delivery Notice (the "APPLICABLE PARTICIPATION AGREEMENT") and cause such
certificates, documents and legal opinions relating to the Trustee to be duly
delivered as required by the Applicable Participation Agreement. If at any time
prior to the Applicable Delivery Date, the Trustee receives a notice of
postponement pursuant to Section 1(e) or 1(f) of the NPA, then the Trustee shall
give the Depositary (with a copy to the Escrow Agent) a notice of cancellation
of such Notice of Purchase Withdrawal relating to such Deposit or Deposits on
such Applicable Delivery Date. Upon satisfaction of the conditions specified in
the NPA and the Applicable Participation Agreement, the Trustee shall purchase
the applicable Equipment Notes with the proceeds of the withdrawals of one or
more Deposits made on the Applicable Delivery Date in accordance with the terms
of the Deposit Agreement and the Escrow Agreement (or, if the Issuance Date is
the Applicable Delivery Date with respect to such Applicable Participation
Agreement, from a portion of the proceeds of the sale of the Applicable
Certificates). The purchase price of such Equipment Notes shall equal the
principal amount of such Equipment Notes. Amounts withdrawn from such Deposit or
Deposits in excess of the purchase price of the Equipment Notes or to the extent
not applied on the Applicable Delivery Date to the purchase price of the
Equipment Notes, shall be re-deposited by the Trustee with the Depositary on the
Applicable Delivery Date in accordance with the terms of the Deposit Agreement.
The provisions of this Section 5.01(b) supersede and replace the provisions of
Section 2.02 of the Basic Agreement with respect to the Applicable Trust, and
all provisions of the Basic Agreement relating to Postponed Notes and Section
2.02 of the Basic Agreement shall not apply to the Applicable Trust.
(c) The Trustee acknowledges its acceptance of all right, title and
interest in and to the Trust Property to be acquired pursuant to Section 5.01(b)
of this Trust Supplement, the NPA and each Applicable Participation Agreement,
and declares that it holds and will hold such right, title and interest for the
benefit of all present and future Applicable Certificateholders, upon the trusts
set forth in the Agreement. By its acceptance of an Applicable Certificate, each
initial Applicable Certificateholder, as a grantor of the Applicable Trust,
joins with the Trustee in the creation of the Applicable Trust. The provisions
of this Section 5.01(c) supersede and replace the provisions of Section 2.03 of
the Basic Agreement, with respect to the Applicable Trust.
Section 5.02. WITHDRAWAL OF DEPOSITS. If any Deposits remain
outstanding on the Business Day next succeeding the Cut-off Date, the Trustee
shall give the Escrow Agent notice that the Trustee's obligation to purchase
Equipment Notes under the NPA has terminated and instruct the Escrow Agent to
provide a notice of Final Withdrawal to the Depositary substantially in the form
of Exhibit B to the Deposit Agreement (the "FINAL WITHDRAWAL Notice").
Section 5.03. THE TRUSTEE. (a) Subject to Section 5.04 of this Trust
Supplement and Section 7.15 of the Basic Agreement, the Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Trust Supplement, the Deposit Agreement, the NPA or the
Escrow Agreement or the due execution hereof or thereof by the Company or the
other parties thereto (other than the Trustee), or for or in respect of the
recitals and statements contained herein or therein, all of which recitals and
statements are made solely by the Company, except that the Trustee hereby
represents and warrants that each of this Trust Supplement, the Basic Agreement,
each Applicable Certificate, the Intercreditor Agreement, the NPA and the Escrow
Agreement has been executed and delivered by one of its officers who is duly
authorized to execute and deliver such document on its behalf.
(b) Except as herein otherwise provided and except during the
continuation of an Event of Default in respect of the Applicable Trust created
hereby, no duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this Trust Supplement other
than as set forth in the Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions set
forth in the Agreement, as fully to all intents as if the same were herein set
forth at length.
Section 5.04. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants that:
(a) the Trustee has full power, authority and legal right to
execute, deliver and perform this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is or is to become a party and has taken all necessary action to
authorize the execution, delivery and performance by it of this Trust
Supplement, the Intercreditor Agreement, the Escrow Agreement, the NPA and
the Note Documents to which it is or is to become a party;
(b) the execution, delivery and performance by the Trustee of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is or is to become a party (i) will
not violate any provision of any United States federal law or the law of
the state of the United States where it is located governing the banking
and trust powers of the Trustee or any order, writ, judgment, or decree of
any court, arbitrator or governmental authority applicable to the Trustee
or any of its assets, (ii) will not violate any provision of the articles
of association or by-laws of the Trustee, and (iii) will not violate any
provision of, or constitute, with or without notice or lapse of time, a
default under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the provisions of
any mortgage, indenture, contract, agreement or other undertaking to which
it is a party, which violation, default or lien could reasonably be
expected to have an adverse effect on the Trustee's performance or ability
to perform its duties hereunder or thereunder or on the transactions
contemplated herein or therein;
(c) the execution, delivery and performance by the Trustee of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is or is to become a party will not
require the authorization, consent, or approval of, the giving of notice
to, the filing or registration with, or the taking of any other action in
respect of, any governmental authority or agency of the United States or
the state of the United States where it is located regulating the banking
and corporate trust activities of the Trustee; and
(d) this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement, the NPA and the Note Documents to which it is or is to become a
party have been, or will be, as applicable, duly executed and delivered by
the Trustee and constitute, or will constitute, as applicable, the legal,
valid and binding agreements of the Trustee, enforceable against it in
accordance with their respective terms; PROVIDED, HOWEVER, that
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of
creditors generally and (ii) general principles of equity.
Section 5.05. TRUSTEE LIENS. The Trustee in its individual capacity
agrees, in addition to the agreements contained in Section 7.17 of the Basic
Agreement, that it will at its own cost and expense promptly take any action as
may be necessary to duly discharge and satisfy in full any Trustee's Liens on or
with respect to the Trust Property which is attributable to the Trustee in its
individual capacity and which is unrelated to the transactions contemplated by
the Intercreditor Agreement or the NPA.
ARTICLE VI
ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS
Section 6.01. AMENDMENT OF SECTION 5.02 OF THE BASIC AGREEMENT.
Section 5.02 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by (i) replacing the phrase "of the Note Documents and of this
Agreement" set forth in paragraph (b) thereof with the phrase "of the Note
Documents, of the NPA and of this Agreement" and (ii) replacing the phrase "of
this Agreement and any Note Document" set forth in the last paragraph of Section
5.02 with the phrase "of this Agreement, the NPA and any Note Document".
Section 6.02. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.01 of the Basic Agreement,
under the terms of, and subject to the limitations contained in, Section 9.01 of
the Basic Agreement, the Company may (but will not be required to), and the
Trustee (subject to Section 9.03 of the Basic Agreement) shall, at the Company's
request, at any time and from time to time, (i) enter into one or more
agreements supplemental to the Escrow Agreement, the NPA, the Deposit Agreement,
the Reference Agency Agreement, the Policy or the Policy Provider Agreement for
any of the purposes set forth in clauses (1) through (9) of such Section 9.01,
and (without limitation of the foregoing or Section 9.01 of the Basic Agreement)
(a) the reference in the introductory paragraph of Section 9.01 of the Basic
Agreement to a "Liquidity Facility" shall be deemed to refer to "the Primary
Liquidity Facility", (b) clauses (2) and (3) of such Section 9.01 shall also be
deemed to include the Company's obligations under (in the case of clause (2)),
and the Company's rights and powers conferred by (in the case of clause (3)),
the NPA, the Reference Agency Agreement, the Policy or the Policy Provider
Agreement, and (c) references in clauses (4), (6) and (7) of such Section 9.01
to "any Intercreditor Agreement or any Liquidity Facility" shall also be deemed
to refer to "the Intercreditor Agreement, the Primary Liquidity Facility, the
Escrow Agreement, the Reference Agency Agreement, the NPA, the Deposit
Agreement, the Policy or the Policy Provider Agreement", (ii) enter into one or
more agreements supplemental to the Agreement, the Intercreditor Agreement, the
Reference Agency Agreement or the NPA to provide for the formation of the
Re-Issued Class H Trust, the issuance of the Re-Issued Class H Certificates, the
purchase by the Re-Issued Class H Trust of Equipment Notes and other matters
incidental thereto or otherwise contemplated by Section 2.01(b) of the Basic
Agreement; PROVIDED that (x) a Ratings Confirmation for the Applicable
Certificates and the Class G-1 Certificates shall have been obtained with
respect to such agreements and (y) the Company shall have certified to the
Trustee and to the Other Trustees that such agreements shall not materially and
adversely affect the Applicable Certificateholders or the Class G-1
Certificateholders and (iii) enter into one or more agreements supplemental to
the Agreement to provide for the formation of a Class J Trust, the issuance of
Class J Certificates, the purchase by the Class J Trust of Equipment Notes and
other matters incidental thereto or otherwise contemplated by Section 2.01(b) of
the Basic Agreement.
Section 6.03. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.02 of the Basic Agreement,
the provisions of Section 9.02 of the Basic Agreement shall apply to agreements
or amendments for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Escrow Agreement, the Deposit
Agreement, the Primary Liquidity Facility, the Reference Agency Agreement, the
NPA, the Policy or the Policy Provider Agreement or modifying in any manner the
rights and obligations of the Applicable Certificateholders under the Escrow
Agreement, the Deposit Agreement, the Primary Liquidity Facility, the Reference
Agency Agreement, the NPA, the Policy or the Policy Provider Agreement; PROVIDED
that the provisions of Section 9.02(1) of the Basic Agreement shall be deemed to
include reductions in any manner of, or delay in the timing of, any receipt by
the Applicable Certificateholders of payments upon the Deposits.
Section 6.04. CONSENT OF HOLDERS OF CERTIFICATES ISSUED UNDER OTHER
TRUSTS. Notwithstanding any provision in Section 6.02 or Section 6.03 of this
Trust Supplement to the contrary, no amendment or modification of Section 4.01
of this Trust Supplement shall be effective unless the trustee for each Class of
Certificates affected by such amendment or modification shall have consented
thereto.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. TERMINATION OF THE APPLICABLE TRUST. (a) The
respective obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the earlier of (A) the
completion of the assignment, transfer and discharge described in the first
sentence of the immediately following paragraph and (B) distribution to all
Applicable Certificateholders and the Trustee of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property; PROVIDED, HOWEVER, that in no event
shall the Applicable Trust continue beyond one hundred ten (110) years following
the date of the execution of this Trust Supplement.
Upon the earlier of (i) the first Business Day following August 31,
2002 or, if later, the fifth Business Day following the Delivery Period
Termination Date and (ii) the fifth Business Day following the date on which a
Triggering Event occurs (such date, the "TRANSFER DATE"), or, if later, the date
on which all of the conditions set forth in the immediately following sentence
have been satisfied, the Trustee is hereby directed (subject only to the
immediately following sentence) to, and the Company shall direct the institution
that will serve as the Related Trustee under the Related Pass Through Trust
Agreement to, execute and deliver the Assignment and Assumption Agreement,
pursuant to which the Trustee shall assign, transfer and deliver all of the
Trustee's right, title and interest to the Trust Property to the Related Trustee
under the Related Pass Through Trust Agreement. The Trustee and the Related
Trustee shall execute and deliver the Assignment and Assumption Agreement upon
the satisfaction of the following conditions:
(i) The Trustee, the Related Trustee and each of the Rating Agencies
then rating the Applicable Certificates shall have received an Officer's
Certificate and an Opinion of Counsel dated the date of the Assignment and
Assumption Agreement and each satisfying the requirements of Section 1.02
of the Basic Agreement, which Opinion of Counsel shall be substantially to
the effect set forth below and may be relied upon by the Beneficiaries (as
defined in the Assignment and Assumption Agreement):
(I) Upon the execution and delivery thereof by the parties thereto
in accordance with the terms of the Agreement and the Related Pass Through
Trust Agreement, the Assignment and Assumption Agreement will constitute
the valid and binding obligation of each of the parties thereto
enforceable against each such party in accordance with its terms;
(II) Upon the execution and delivery of the Assignment and
Assumption Agreement in accordance with the terms of the Agreement and the
Related Pass Through Trust Agreement, each of the Applicable Certificates
then Outstanding will be entitled to the benefits of the Related Pass
Through Trust Agreement;
(III) The Related Trust is not required to be registered as an
investment company under the Investment Company Act of 1940, as amended;
(IV) The Related Pass Through Trust Agreement constitutes the valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms; and
(V) Neither the execution and delivery of the Assignment and
Assumption Agreement in accordance with the terms of the Agreement and the
Related Pass Through Trust Agreement, nor the consummation by the parties
thereto of the transactions contemplated to be consummated thereunder on
the date thereof, will violate any law or governmental rule or regulation
of the State of New York or the United States of America known to such
counsel to be applicable to the transactions contemplated by the
Assignment and Assumption Agreement.
(ii) The Trustee and the Company shall have received (x) a copy of
the articles of incorporation and bylaws of the Related Trustee certified
as of the Transfer Date by the Secretary or Assistant Secretary of such
institution and (y) a copy of the filing (including all attachments
thereto) made by the institution serving as the Related Trustee with the
Office of the Superintendent, State of New York Banking Department for the
qualification of the Related Trustee under Section 131(3) of the New York
Banking Law.
Upon the execution of the Assignment and Assumption Agreement by the parties
thereto, the Applicable Trust shall be terminated, the Applicable
Certificateholders shall receive beneficial interests in the Related Trust in
exchange for their interests in the Applicable Trust equal to their respective
beneficial interests in the Applicable Trust, and the Outstanding Applicable
Certificates representing Fractional Undivided Interests in the Applicable Trust
shall be deemed for all purposes of the Agreement and the Related Pass Through
Trust Agreement, without further signature or action of any party or Applicable
Certificateholder, to be certificates representing the same fractional undivided
interests in the Related Trust and its trust property. By acceptance of its
Applicable Certificate, each Applicable Certificateholder consents to such
assignment, transfer and delivery of the Trust Property to the trustee of the
Related Trust upon the execution and delivery of the Assignment and Assumption
Agreement.
In connection with the occurrence of the event set forth in clause
(B) above, notice of such termination, specifying the Distribution Date upon
which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the 15th day
next preceding such final Distribution Date specifying (A) the Distribution Date
upon which the proposed final payment of the Applicable Certificates will be
made upon presentation and surrender of Applicable Certificates at the office or
agency of the Trustee therein specified, (B) the amount of any such proposed
final payment, and (C) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Applicable Certificates at the office or agency of the
Trustee therein specified. The Trustee shall give such notice to the Registrar
at the time such notice is given to Applicable Certificateholders. Upon
presentation and surrender of the Applicable Certificates in accordance with
such notice, the Trustee shall cause to be distributed to Applicable
Certificateholders such final payments.
In the event that all of the Applicable Certificateholders shall not
surrender their Applicable Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Trustee shall give
a second written notice to the remaining Applicable Certificateholders to
surrender their Applicable Certificates for cancellation and receive the final
distribution with respect thereto. No additional interest shall accrue on the
Applicable Certificates after the Distribution Date specified in the first
written notice. In the event that any money held by the Trustee for the payment
of distributions on the Applicable Certificates shall remain unclaimed for two
years (or such lesser time as the Trustee shall be satisfied, after sixty days'
notice from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money relating
to such Loan Trustee and shall give written notice thereof to the Company.
(b) The provisions of this Section 7.01 supersede and replace the
provisions of Section 11.01 of the Basic Agreement in its entirety, with respect
to the Applicable Trust.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. BASIC AGREEMENT RATIFIED. Except and so far as herein
expressly provided, all of the provisions, terms and conditions of the Basic
Agreement are in all respects ratified and confirmed; and the Basic Agreement
and this Trust Supplement shall be taken, read and construed as one and the same
instrument. All replacements of provisions of, and other modifications of the
Basic Agreement set forth in this Trust Supplement are solely with respect to
the Applicable Trust.
SECTION 8.02. GOVERNING LAW. THE AGREEMENT AND, UNTIL THE TRANSFER
DATE, THE APPLICABLE CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE. THIS SECTION 8.02 SUPERSEDES
AND REPLACES SECTION 12.05 OF THE BASIC AGREEMENT, WITH RESPECT TO THE
APPLICABLE TRUST.
Section 8.03. EXECUTION IN COUNTERPARTS. This Trust Supplement may
be executed in any number of counterparts, each of which shall be an original,
but such counterparts shall together constitute but one and the same instrument.
Section 8.04. INTENTION OF PARTIES. The parties hereto intend that
the Applicable Trust be classified for U.S. federal income tax purposes as a
grantor trust under Subpart E, Part I of Subchapter J of the Internal Revenue
Code of 1986, as amended, and not as a trust or association taxable as a
corporation or as a partnership. Each Applicable Certificateholder and Investor,
by its acceptance of its Applicable Certificate or a beneficial interest
therein, agrees to treat the Applicable Trust as a grantor trust for all U.S.
federal, state and local income tax purposes. The powers granted and obligations
undertaken pursuant to the Agreement shall be so construed so as to further such
intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Trust Supplement to be duly executed by their respective officers thereto duly
authorized, as of the day and year first written above.
CONTINENTAL AIRLINES, INC.
By:
------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
------------------------
Name:
Title:
EXHIBIT A
FORM OF CERTIFICATE
Certificate
No. ______
[Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to Issuer or its agent for registration of transfer, exchange or payment, and
any certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any payment is
made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch the registered owner hereof,
Cede & Co., has an interest herein.]
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-2-O
Continental Airlines Pass Through Certificate, Series 2002-1G-2-O
Issuance Date: March 25, 2002
Final Maturity Date: August 15, 2013
Evidencing A Fractional Undivided Interest In The Continental Airlines
Pass Through Trust 2002-1G-2-O, The Property Of Which Shall Include
Certain Equipment Notes Each Secured By An Aircraft Owned By Continental
Airlines, Inc.
$[_____________] Fractional Undivided Interest
representing .0005140807% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________, for value received, is the
registered owner of a $___________ (___________________________________________
DOLLARS) Fractional Undivided Interest in the Continental Airlines Pass Through
Trust 2002-1G-2-O (the "TRUST") created by Wilmington Trust Company, as trustee
(the "TRUSTEE"), pursuant to a Pass Through Trust Agreement, dated as of
September 25, 1997 (the "BASIC AGREEMENT"), between the Trustee and Continental
- --------------------------------
This legend to appear on Book-Entry Certificates to be deposited with the
Depository Trust Company.
Airlines, Inc., a Delaware corporation (the "COMPANY"), as supplemented by Trust
Supplement No. 2002-1G-2-O thereto, dated as of March 25, 2002 (the "TRUST
SUPPLEMENT" and, together with the Basic Agreement, the "AGREEMENT"), between
the Trustee and the Company, a summary of certain of the pertinent provisions of
which is set forth below. To the extent not otherwise defined herein, the
capitalized terms used herein have the meanings assigned to them in the
Agreement. This Certificate is one of the duly authorized Certificates
designated as "Continental Airlines Pass Through Certificates, Series
2002-1G-2-O" (herein called the "CERTIFICATES"). This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement.
By virtue of its acceptance hereof, the holder of this Certificate (the
"CERTIFICATEHOLDER" and, together with all other holders of Certificates issued
by the Trust, the "CERTIFICATEHOLDERS") assents to and agrees to be bound by the
provisions of the Agreement and the Intercreditor Agreement. The property of the
Trust includes certain Equipment Notes and all rights of the Trust to receive
payments under the Intercreditor Agreement, the Policy and the Primary Liquidity
Facility (the "TRUST PROPERTY"). Each issue of the Equipment Notes is secured
by, among other things, a security interest in an Aircraft owned by the Company.
The Certificates represent Fractional Undivided Interests in the
Trust and the Trust Property and have no rights, benefits or interest in respect
of any other separate trust established pursuant to the terms of the Basic
Agreement for any other series of certificates issued pursuant thereto.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on February 15, May 15, August 15 and November 15 of each year (a
"REGULAR DISTRIBUTION DATE") commencing May 15, 2002, to the Person in whose
name this Certificate is registered at the close of business on the 15th day
preceding the Regular Distribution Date, an amount in respect of the Scheduled
Payments on the Equipment Notes due on such Regular Distribution Date, the
receipt of which has been confirmed by the Trustee, equal to the product of the
percentage interest in the Trust evidenced by this Certificate and an amount
equal to the sum of such Scheduled Payments. Subject to and in accordance with
the terms of the Agreement and the Intercreditor Agreement, in the event that
Special Payments on the Equipment Notes are received by the Trustee, from funds
then available to the Trustee, there shall be distributed on the applicable
Special Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee, equal
to the product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular Distribution Date or Special Distribution Date is not a Business
Day, distribution shall be made on the immediately following Business Day with
the same force and effect as if made on such Regular Distribution Date or
Special Distribution Date and no interest shall accrue during the intervening
period. The Trustee shall mail notice of each Special Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.
Distributions on this Certificate will be made by the Trustee by
check mailed to the Person entitled thereto, without presentation or surrender
of this Certificate or the making of any notation hereon, except that with
respect to Certificates registered on the Record Date in the name of a Clearing
Agency (or its nominee), such distribution shall be made by wire transfer.
Except as otherwise provided in the Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after notice mailed by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency of the Trustee specified
in such notice.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company or the Trustee or any
affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement. All payments or
distributions made to Certificateholders under the Agreement shall be made only
from the Trust Property and only to the extent that the Trustee shall have
sufficient income or proceeds from the Trust Property to make such payments in
accordance with the terms of the Agreement. Each Certificateholder of this
Certificate, by its acceptance hereof, agrees that it will look solely to the
income and proceeds from the Trust Property to the extent available for
distribution to such Certificateholder as provided in the Agreement. This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests, rights, benefits,
obligations, privileges, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by any
Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any time
by the Company and the Trustee with the consent of the Certificateholders
holding Certificates evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the Trust. Any such consent by the
Certificateholder of this Certificate shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Certificateholders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the Register
upon surrender of this Certificate for registration of transfer at the offices
or agencies maintained by the Trustee in its capacity as Registrar, or by any
successor Registrar, duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the Certificateholder hereof or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.
Under certain circumstances set forth in Section 7.01 of the Trust
Supplement, all of the Trustee's right, title and interest to the Trust Property
may be assigned, transferred and delivered to the Related Trustee of the Related
Trust pursuant to the Assignment and Assumption Agreement. Upon the
effectiveness of such Assignment and Assumption Agreement (the "TRANSFER"), the
Trust shall be terminated, the Certificateholders shall receive beneficial
interests in the Related Trust in exchange for their interests in the Trust
equal to their respective beneficial interests in the Trust, the Certificates
representing Fractional Undivided Interests in the Trust shall be deemed for all
purposes of the Agreement and the Related Pass Through Trust Agreement to be
certificates representing the same fractional undivided interests in the Related
Trust and its trust property. Each Certificateholder, by its acceptance of this
Certificate or a beneficial interest herein, agrees to be bound by the
Assignment and Assumption Agreement and subject to the terms of the Related Pass
Through Trust Agreement as a Certificateholder thereunder. From and after the
Transfer, unless and to the extent the context otherwise requires, references
herein to the Trust, the Agreement and the Trustee shall constitute references
to the Related Trust, the Related Pass Through Trust Agreement and trustee of
the Related Trust, respectively.
The Certificates are issuable only as registered Certificates
without coupons in minimum denominations of $1,000 Fractional Undivided Interest
and integral multiples thereof, except that one Certificate may be issued in a
different denomination. As provided in the Agreement and subject to certain
limitations therein set forth, the Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.
Each Certificateholder and Investor, by its acceptance of this
Certificate or a beneficial interest herein, agrees to treat the Trust as a
grantor trust for all U.S. federal, state and local income tax purposes.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Trustee, the Registrar, nor
any such agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and
the Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Agreement and the disposition of all property held as part of the Trust
Property.
Any Person acquiring or accepting this Certificate or an interest
herein will, by such acquisition or acceptance, be deemed to have represented
and warranted to and for the benefit of the Company that either: (i) the assets
of an employee benefit plan subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975
of the Internal Revenue Code of 1986, as amended (the "Code"), have not been
used to purchase this Certificate or an interest herein or (ii) the purchase and
holding of this Certificate or an interest herein are exempt from the prohibited
transaction restrictions of ERISA and the Code pursuant to one or more
prohibited transaction statutory or administrative exemptions.
THE AGREEMENT AND, UNTIL THE TRANSFER, THIS CERTIFICATE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS. THE RELATED PASS THROUGH TRUST
AGREEMENT AND, FROM AND AFTER THE TRANSFER, THIS CERTIFICATE SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
CONTINENTAL AIRLINES PASS THROUGH
TRUST 2002-1G-2-O
By: WILMINGTON TRUST COMPANY,
as Trustee
By:
------------------------
Name:
Title:
FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
WILMINGTON TRUST COMPANY,
as Trustee
By:
------------------------
Name:
Title:
EXHIBIT B
[DTC Letter of Representations]
EXHIBIT C
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
Continental Airlines Pass Through Trust 2002-1G-2-O
ASSIGNMENT AND ASSUMPTION AGREEMENT (2002-1G-2), dated ________ __,
____ (the "ASSIGNMENT AGREEMENT"), between Wilmington Trust Company, a Delaware
banking corporation ("WTC"), not in its individual capacity except as expressly
provided herein, but solely as trustee under the Pass Through Trust Agreement
dated as of September 25, 1997 (as amended or modified from time to time, the
"BASIC AGREEMENT"), as supplemented by the Trust Supplement No. 2002-1G-2-O
dated as of March 25, 2002 (the "TRUST SUPPLEMENT" and together with the Basic
Agreement, the "AGREEMENT") in respect of the Continental Airlines Pass Through
Trust 2002-1G-2-O (the "ASSIGNOR"), and Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity except as expressly provided
herein, but solely as trustee under the Basic Agreement as supplemented by the
Trust Supplement No. 2002-1G-2-S dated as of March 25, 2002 (the "NEW
SUPPLEMENT", and, together with the Basic Agreement, the "NEW AGREEMENT") in
respect of the Continental Airlines Pass Through Trust 2002-1G-2-S (the
"ASSIGNEE").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to effect on the date hereof (the
"TRANSFER DATE") (a) the transfer by the Assignor to the Assignee of all of the
right, title and interest of the Assignor in, under and with respect to, among
other things, the Trust Property and each of the documents listed in Schedule I
hereto (the "SCHEDULED DOCUMENTS") and (b) the assumption by the Assignee of the
obligations of the Assignor (i) under the Scheduled Documents and (ii) in
respect of the Applicable Certificates issued under the Agreement; and
WHEREAS, the Scheduled Documents permit such transfer upon
satisfaction of certain conditions heretofore or concurrently herewith being
complied with;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto do hereby agree as
follows (capitalized terms used herein without definition having the meaning
ascribed thereto in the Agreement):
1. ASSIGNMENT. The Assignor does hereby sell, assign, convey,
transfer and set over unto the Assignee as of the Transfer Date all of its
present and future right, title and interest in, under and with respect to the
Trust Property and the Scheduled Documents and each other contract, agreement,
document or instrument relating to the Trust Property or the Scheduled Documents
(such other contracts, agreements, documents or instruments, together with the
Scheduled Documents, to be referred to as the "ASSIGNED DOCUMENTS"), and any
proceeds therefrom, together with all documents and instruments evidencing any
of such right, title and interest.
2. ASSUMPTION. The Assignee hereby assumes for the benefit of the
Assignor and each of the parties listed in Schedule II hereto (collectively, the
"BENEFICIARIES") all of the duties and obligations of the Assignor, whenever
accrued, pursuant to the Assigned Documents and hereby confirms that it shall be
deemed a party to each of the Assigned Documents to which the Assignor is a
party and shall be bound by all the terms thereof (including the agreements and
obligations of the Assignor set forth therein) as if therein named as the
Assignor. Further, the Assignee hereby assumes for the benefit of the Assignor
and the Beneficiaries all of the duties and obligations of the Assignor under
the Outstanding Applicable Certificates and hereby confirms that the Applicable
Certificates representing Fractional Undivided Interests under the Agreement
shall be deemed for all purposes of the Agreement and the New Agreement to be
certificates representing the same fractional undivided interests under the New
Agreement equal to their respective beneficial interests in the trust created
under the Agreement.
3. EFFECTIVENESS. This Assignment Agreement shall be effective upon
the execution and delivery hereof by the parties hereto, and each Applicable
Certificateholder, by its acceptance of its Applicable Certificate or a
beneficial interest therein, agrees to be bound by the terms of this Assignment
Agreement.
4. PAYMENTS. The Assignor hereby covenants and agrees to pay over to
the Assignee, if and when received following the Transfer Date, any amounts
(including any sums payable as interest in respect thereof) paid to or for the
benefit of the Assignor that, under Section 1 hereof, belong to the Assignee.
5. FURTHER ASSURANCES. The Assignor shall, at any time and from time
to time, upon the request of the Assignee, promptly and duly execute and deliver
any and all such further instruments and documents and take such further action
as the Assignee may reasonably request to obtain the full benefits of this
Assignment Agreement and of the rights and powers herein granted. The Assignor
agrees to deliver any Applicable Certificates, and all Trust Property, if any,
then in the physical possession of the Assignor, to the Assignee.
6. REPRESENTATIONS AND WARRANTIES. (a) The Assignee represents and
warrants to the Assignor and each of the Beneficiaries that:
(i) it has all requisite power and authority and legal right to
enter into and carry out the transactions contemplated hereby and to carry
out and perform the obligations of the "Pass Through Trustee" under the
Assigned Documents;
(ii) on and as of the date hereof, the representations and
warranties of the Assignee set forth in Section 7.15 of the Basic
Agreement and Section 5.04 of the New Supplement are true and correct.
(b) The Assignor represents and warrants to the Assignee that:
(i) it is duly incorporated, validly existing and in good standing
under the laws of the State of Delaware and has the full trust power,
authority and legal right under the laws of the State of Delaware and the
United States pertaining to its trust and fiduciary powers to execute and
deliver this Assignment Agreement;
(ii) the execution and delivery by it of this Assignment Agreement
and the performance by it of its obligations hereunder have been duly
authorized by it and will not violate its articles of association or
by-laws or the provisions of any indenture, mortgage, contract or other
agreement to which it is a party or by which it is bound; and
(iii) this Assignment Agreement constitutes the legal, valid and
binding obligations of it enforceable against it in accordance with its
terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and by general principles of equity, whether
considered in a proceeding at law or in equity.
7. GOVERNING LAW. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING MATTERS
OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
8. COUNTERPARTS. This Assignment Agreement may be executed in any
number of counterparts, all of which together shall constitute a single
instrument. It shall not be necessary that any counterpart be signed by both
parties so long as each party shall sign at least one counterpart.
9. THIRD PARTY BENEFICIARIES. The Assignee hereby agrees, for the
benefit of the Beneficiaries, that its representations, warranties and covenants
contained herein are also intended to be for the benefit of each Beneficiary,
and each Beneficiary shall be deemed to be an express third party beneficiary
with respect thereto, entitled to enforce directly and in its own name any
rights or claims it may have against such party as such beneficiary.
IN WITNESS WHEREOF, the parties hereto, through their respective
officers thereunto duly authorized, have duly executed this Assignment Agreement
as of the day and year first above written.
ASSIGNOR:
WILMINGTON TRUST COMPANY,
not in its individual capacity
except as expressly provided
herein, but solely as trustee
under the Pass Through Trust
Agreement and Trust Supplement
in respect of the Continental
Airlines Pass Through Trust
2002-1G-2-O
By:
---------------------------
Title:
ASSIGNEE:
WILMINGTON TRUST COMPANY,
not in its individual capacity
except as expressly provided
herein, but solely as trustee
under the Pass Through Trust
Agreement and Trust Supplement
in respect of the Continental
Airlines Pass Through Trust
2002-1G-2-S
By:
---------------------------
Title:
Schedule I
Schedule of Assigned Documents
(1) Intercreditor Agreement dated as of March 25, 2002 among the
Trustee, the Other Trustees, the Primary Liquidity Provider, the primary
liquidity provider and the above-cap liquidity provider relating to the Class
G-1 Certificates, the Policy Provider and the Subordination Agent.
(2) Escrow and Paying Agent Agreement (Class G-2) dated as of March
25, 2002 among the Escrow Agent, the Underwriters, the Trustee and the Paying
Agent.
(3) Note Purchase Agreement dated as of March 25, 2002 among the
Company, the Trustee, the Other Trustees, the Depositary, the Escrow Agent, the
Paying Agent and the Subordination Agent.
(4) Deposit Agreement (Class G-2) dated as of March 25, 2002 between
the Escrow Agent and the Depositary.
(5) Each of the Operative Agreements (as defined in the
Participation Agreement for each Aircraft) in effect as of the Transfer Date.
Schedule II
Schedule of Beneficiaries
Wilmington Trust Company, not in its individual capacity but solely as
Subordination Agent
Wilmington Trust Company, not in its individual capacity but solely as Paying
Agent
Landesbank Hessen-Thuringen Girozentrale, as Primary Liquidity Provider
Ambac Assurance Corporation, as Policy Provider
Credit Suisse First Boston, New York Branch, as Depositary
Continental Airlines, Inc.
Credit Suisse First Boston Corporation, as Underwriter
J.P. Morgan Securities Inc., as Underwriter
Merrill Lynch, Pierce, Fenner & Smith, as Underwriter
Salomon Smith Barney Inc., as Underwriter
Morgan Stanley & Co. Incorporated, as Underwriter
Wells Fargo Bank Northwest, National Association, as Escrow Agent
Each of the other parties to the Assigned Documents
[Execution copy]
TRUST SUPPLEMENT No. 2002-1G-2-S
Dated as of March 25, 2002
between
WILMINGTON TRUST COMPANY
as Trustee,
and
CONTINENTAL AIRLINES, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of September 25, 1997
$194,522,000
Continental Airlines Pass Through Trust 2002-1G-2-S
6.563% Continental Airlines
Pass Through Certificates,
Series 2002-1G-2-S
TABLE OF CONTENTS
PAGE
ARTICLE I THE CERTIFICATES.....................................................2
Section 1.01. The Certificates.......................................2
ARTICLE II DEFINITIONS.........................................................4
Section 2.01. Definitions............................................4
ARTICLE III CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS.....11
Section 3.01. Statements to Applicable Certificateholders...........11
Section 3.02. Special Payments Account..............................12
Section 3.03. Distributions from Special Payments Account...........13
ARTICLE IV DEFAULT 14
Section 4.01. Purchase Rights of Certificateholders.................14
Section 4.02. Amendment of Section 6.05 of the Basic Agreement......18
ARTICLE V THE TRUSTEE.........................................................19
Section 5.01. Acquisition of Trust Property.........................19
Section 5.02. [Intentionally Omitted]...............................19
Section 5.03. The Trustee...........................................20
Section 5.04. Representations and Warranties of the Trustee.........20
Section 5.05. Trustee Liens.........................................21
ARTICLE VI ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS......................21
Section 6.01. Amendment of Section 5.02 of the Basic Agreement......21
Section 6.02. Supplemental Agreements Without Consent of
Applicable Certificateholders.........................21
Section 6.03. Supplemental Agreements with Consent of
Applicable Certificateholders.........................22
Section 6.04. Consent of Holders of Certificates Issued under
Other Trusts..........................................22
ARTICLE VII TERMINATION OF TRUST..............................................23
Section 7.01. Termination of the Applicable Trust...................23
ARTICLE VIII MISCELLANEOUS PROVISIONS.........................................24
Section 8.01. Basic Agreement Ratified..............................24
Section 8.02. GOVERNING LAW.........................................24
Section 8.03. Execution in Counterparts.............................24
Section 8.04. Intention of Parties..................................24
This Trust Supplement No. 2002-1G-2-S, dated as of March 25, 2002
(herein called the "TRUST SUPPLEMENT"), between Continental Airlines, Inc., a
Delaware corporation (the "COMPANY"), and Wilmington Trust Company (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein, capitalized
terms used herein without definition having the respective meanings specified in
the Basic Agreement) which may be issued thereunder, has heretofore been
executed and delivered;
WHEREAS, the Company has obtained commitments from Boeing for the
delivery of certain Aircraft;
WHEREAS, as of the Transfer Date (as defined below), the Company
will have financed the acquisition of all or a portion of such Aircraft through
separate secured loan transactions, under which the Company owns such Aircraft
(collectively, the "OWNED AIRCRAFT");
WHEREAS, as of the Transfer Date, in the case of each Owned
Aircraft, the Company will have issued pursuant to an Indenture, on a recourse
basis, Equipment Notes to finance a portion of the purchase price of such Owned
Aircraft;
WHEREAS, as of the Transfer Date, the Related Trustee will assign,
transfer and deliver all of such trustee's right, title and interest to the
trust property held by the Related Trustee to the Trustee pursuant to the
Assignment and Assumption Agreement (as defined below);
WHEREAS, the Trustee, effective only, but automatically, upon
execution and delivery of the Assignment and Assumption Agreement, will be
deemed to have declared the creation of the Continental Airlines Pass Through
Trust 2002-1G-2-S (the "APPLICABLE TRUST") for the benefit of the Applicable
Certificateholders, and each Holder of Applicable Certificates outstanding as of
the Transfer Date, as the grantors of the Applicable Trust, by their respective
acceptances of such Applicable Certificates, will join in the creation of the
Applicable Trust with the Trustee;
WHEREAS, all Applicable Certificates (as defined below) deemed
issued by the Applicable Trust will evidence fractional undivided interests in
the Applicable Trust and will convey no rights, benefits or interests in respect
of any property other than the Trust Property except for those Applicable
Certificates to which an Escrow Receipt (as defined below) has been affixed;
WHEREAS, upon the execution and delivery of the Assignment and
Assumption Agreement, all of the conditions and requirements necessary to make
this Trust Supplement, when duly executed and delivered, a valid, binding and
legal instrument in accordance with its terms and for the purposes herein
expressed, have been done, performed and fulfilled, and the execution and
delivery of this Trust Supplement in the form and with the terms hereof have
been in all respects duly authorized;
WHEREAS, this Trust Supplement is subject to the provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. THE CERTIFICATES. The Applicable Certificates shall be
known as "6.563% Continental Airlines Pass Through Certificates, Series
2002-1G-2-S". Each Applicable Certificate represents a fractional undivided
interest in the Applicable Trust created hereby. The Applicable Certificates
shall be the only instruments evidencing a fractional undivided interest in the
Applicable Trust.
The terms and conditions applicable to the Applicable Certificates
are as follows:
(a) The aggregate principal amount of the Applicable Certificates
that shall be initially deemed issued under the Agreement shall be equal
to the aggregate principal amount of "Outstanding" pass through
certificates representing fractional undivided interests in the Related
Trust on the Transfer Date. Subject to the preceding sentence and Section
5.01 of this Trust Supplement and except for Applicable Certificates
authenticated and delivered under Sections 3.03, 3.04, 3.05 and 3.06 of
the Basic Agreement), no Applicable Certificates shall be authenticated
under the Agreement.
(b) The Regular Distribution Dates with respect to any payment of
Scheduled Payments means February 15, May 15, August 15 and November 15 of
each year, commencing on May 15, 2002, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been made.
(c) The Special Distribution Dates with respect to the Applicable
Certificates means any Business Day on which a Special Payment is to be
distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow Agreement, the
Trustee shall affix the corresponding Escrow Receipt to each Applicable
Certificate. In any event, any transfer or exchange of any Applicable
Certificate shall also effect a transfer or exchange of the related Escrow
Receipt. Prior to the Final Withdrawal Date, no transfer or exchange of
any Applicable Certificate shall be permitted unless the corresponding
Escrow Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an Escrow
Receipt is attached, each Holder of such an Applicable Certificate
acknowledges and accepts the restrictions on transfer of the Escrow
Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form attached as
Exhibit A to the Related Pass Through Trust Supplement, with such
appropriate insertions, omissions, substitutions and other variations as
are required or permitted by the Related Pass Through Trust Agreement or
the Agreement, as the case may be, or as the Trustee may deem appropriate,
to reflect the fact that the Applicable Certificates are being issued
under the Agreement as opposed to under the Related Pass Through Trust
Agreement. Any Person acquiring or accepting an Applicable Certificate or
an interest therein will, by such acquisition or acceptance, be deemed to
represent and warrant to and for the benefit of the Company that either
(i) the assets of an employee benefit plan subject to Title I of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
of a plan subject to Section 4975 of the Internal Revenue Code of 1986, as
amended (the "CODE"), have not been used to purchase Applicable
Certificates or an interest therein or (ii) the purchase and holding of
Applicable Certificates or an interest therein is exempt from the
prohibited transaction restrictions of ERISA and the Code pursuant to one
or more prohibited transaction statutory or administrative exemptions.
(ii) The Applicable Certificates shall be Book-Entry Certificates
and shall be subject to the conditions set forth in the Letter of
Representations between the Company and the Clearing Agency attached as
Exhibit B to the Related Pass Through Trust Supplement.
(f) The "Participation Agreements" as defined in this Trust
Supplement are the "Note Purchase Agreements" referred to in the Basic
Agreement.
(g) The Applicable Certificates are subject to the Intercreditor
Agreement, the Deposit Agreement and the Escrow Agreement.
(h) The Applicable Certificates are entitled to the benefits of the
Primary Liquidity Facility and the Policy.
(i) The Responsible Party is the Company.
(j) The date referred to in clause (i) of the definition of the term
"PTC Event of Default" in the Basic Agreement is the Final Maturity Date.
(k) The "particular sections of the Note Purchase Agreement", for
purposes of clause (3) of Section 7.07 of the Basic Agreement, are Section
8.1 of each Participation Agreement.
(l) The Equipment Notes to be acquired and held in the Applicable
Trust, and the related Aircraft and Note Documents, are described in the
NPA.
ARTICLE II
DEFINITIONS
Section 2.01. DEFINITIONS. For all purposes of the Basic Agreement
as supplemented by this Trust Supplement, the following capitalized terms have
the following meanings (any term used herein which is defined in both this Trust
Supplement and the Basic Agreement shall have the meaning assigned thereto in
this Trust Supplement for purposes of the Basic Agreement as supplemented by
this Trust Supplement):
AGREEMENT: Means the Basic Agreement, as supplemented by this Trust
Supplement.
AIRCRAFT: Means each of the New Aircraft or Substitute Aircraft in
respect of which a Participation Agreement is entered into in accordance
with the NPA (or any substitute aircraft, including engines therefor,
owned by the Company and securing one or more Equipment Notes).
AIRCRAFT PURCHASE AGREEMENT: Has the meaning specified in the NPA.
APPLICABLE CERTIFICATE: Means any of the "Applicable Certificates"
issued by the Related Trust and that are "Outstanding" (as defined in the
Related Pass Through Trust Agreement) as of the Transfer Date (the
"TRANSFER DATE CERTIFICATES") and any Certificate issued in exchange
therefor or replacement thereof pursuant to the Agreement.
APPLICABLE CERTIFICATEHOLDER: Means the Person in whose name an
Applicable Certificate is registered on the Register for the Applicable
Certificates.
APPLICABLE TRUST: Has the meaning specified in the recitals hereto.
ASSIGNMENT AND ASSUMPTION AGREEMENT: Means the assignment and
assumption agreement substantially in the form of Exhibit C to the Related
Pass Through Trust Supplement executed and delivered in accordance with
Section 7.01 of the Related Trust Supplement.
BASIC AGREEMENT: Has the meaning specified in the first paragraph of
this Trust Supplement.
BOEING: Means The Boeing Company.
BUSINESS DAY: Means any day other than a Saturday, a Sunday or a day
on which commercial banks are required or authorized to close in Houston,
Texas, New York, New York, or, so long as any Applicable Certificate is
Outstanding, the city and state in which the Trustee, the Subordination
Agent or any Loan Trustee maintains its Corporate Trust Office or receives
and disburses funds, and, if any Series G-1 Equipment Notes (as defined in
the Intercreditor Agreement) or Series H Equipment Notes (as defined in
the Intercreditor Agreement) are outstanding, which is also a day for
trading by and between banks in the London interbank Eurodollar market.
CERTIFICATE: Has the meaning specified in the Intercreditor
Agreement.
CLASS: Has the meaning specified in the Intercreditor Agreement.
COMPANY: Has the meaning specified in the first paragraph of this
Trust Supplement.
CONTROLLING PARTY: Has the meaning specified in the Intercreditor
Agreement.
CUT-OFF DATE: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event occurs.
DELIVERY NOTICE: Has the meaning specified in the NPA.
DELIVERY PERIOD TERMINATION DATE: Has the meaning specified in the
Related Pass Through Trust Supplement.
DEPOSIT AGREEMENT: Means the Deposit Agreement dated as of March 25,
2002 relating to the Applicable Certificates between the Depositary and
the Escrow Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
DEPOSIT MAKE-WHOLE PREMIUM: Has the meaning specified in the NPA.
DEPOSITARY: Means Credit Suisse First Boston, a banking institution
organized under the laws of Switzerland, acting through its New York
branch.
DEPOSITS: Has the meaning specified in the Deposit Agreement.
DISTRIBUTION DATE: Means any Regular Distribution Date or Special
Distribution Date as the context requires.
ESCROW AGENT: Means, initially, Wells Fargo Bank Northwest, National
Association, and any replacement or successor therefor appointed in
accordance with the Escrow Agreement.
ESCROW AGREEMENT: Means the Escrow and Paying Agent Agreement dated
as of March 25, 2002 relating to the Applicable Certificates, among the
Escrow Agent, the Escrow Paying Agent, the Related Trustee (and after the
Transfer Date, the Trustee) and the Underwriters, as the same may be
amended, supplemented or otherwise modified from time to time in
accordance with its terms.
ESCROW PAYING AGENT: Means the Person acting as paying agent under
the Escrow Agreement.
ESCROW RECEIPT: Means the receipt substantially in the form annexed
to the Escrow Agreement representing a fractional undivided interest in
the funds held in escrow thereunder.
FINAL MATURITY DATE: Means August 15, 2013.
FINAL WITHDRAWAL: Has the meaning specified in the Escrow Agreement.
FINAL WITHDRAWAL DATE: Has the meaning specified in the Escrow
Agreement.
INDENTURE: Means each of the separate trust indentures and mortgages
relating to the Aircraft, each as specified or described in a Delivery
Notice delivered pursuant to the NPA or the related Participation
Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.
INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as
of March 25, 2002 among the Related Other Trustee (and after the Transfer
Date, the Trustee), the Other Related Trustees (and after the Transfer
Date, the Other Trustees), the Primary Liquidity Provider, the primary
liquidity provider and the above-cap liquidity provider relating to the
Class G-1 Certificates, the Policy Provider and Wilmington Trust Company,
as Subordination Agent and as trustee thereunder, as amended, supplemented
or otherwise modified from time to time in accordance with its terms.
INVESTORS: Means the Underwriters, together with all subsequent
beneficial owners of the Applicable Certificates.
MAKE-WHOLE AMOUNT: Has the meaning specified in the Indentures.
NEW AIRCRAFT: Has the meaning specified in the NPA.
NOTE DOCUMENTS: Means the Equipment Notes with respect to the
Applicable Certificates and, with respect to any such Equipment Note, the
Indenture and the Participation Agreement relating to such Equipment Note.
NPA: Means the Note Purchase Agreement dated as of March 25, 2002
among the Related Trustee (and after the Transfer Date, the Trustee), the
Related Other Trustees (and after the Transfer Date, the Other Trustees),
the Company, the Escrow Agent, the Escrow Paying Agent and the
Subordination Agent, as the same may be amended, supplemented or otherwise
modified from time to time, in accordance with its terms.
OTHER AGREEMENTS: Means (i) the Basic Agreement as supplemented by
Trust Supplement No. 2002-1G-1-S dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1G-1-S, (ii) the Basic
Agreement as supplemented by Trust Supplement No. 2002-1H-S dated as of
the date hereof relating to Continental Airlines Pass Through Trust
2002-1H-S and (iii) the Basic Agreement as supplemented by Trust
Supplement No. 2002-1I-S dated as of the date hereof relating to
Continental Airlines Pass Through Trust 2002-1I-S.
OTHER TRUSTEES: Means the trustees under the Other Agreements, and
any successor or other trustee appointed as provided therein.
OTHER TRUSTS: Means the Continental Airlines Pass Through Trust
2002-1G-1-S, the Continental Airlines Pass Through Trust 2002-1H-S and the
Continental Airlines Pass Through Trust 2002-1I-S, created by the Other
Agreements.
OUTSTANDING: When used with respect to Applicable Certificates,
means, as of the date of determination, all Transfer Date Certificates,
and all other Applicable Certificates theretofore authenticated and
delivered under the Agreement, in each case except:
(i) Applicable Certificates theretofore canceled by the
Registrar or delivered to the Trustee or the Registrar for
cancellation;
(ii) Applicable Certificates for which money in the full
amount required to make the final distribution with respect to such
Applicable Certificates pursuant to Section 11.01 of the Basic
Agreement has been theretofore deposited with the Trustee in trust
for the Applicable Certificateholders as provided in Section 4.01 of
the Basic Agreement pending distribution of such money to such
Applicable Certificateholders pursuant to payment of such final
distribution; and
(iii) Applicable Certificates in exchange for or in lieu of
which other Applicable Certificates have been authenticated and
delivered pursuant to this Agreement.
OWNED AIRCRAFT: Has the meaning specified in the third recital to
this Trust Supplement.
PARTICIPATION AGREEMENT: Means each Participation Agreement entered
into by the Related Trustee pursuant to the NPA, as the same may be
amended, supplemented or otherwise modified in accordance with its terms.
POLICY: Means, with respect to the Applicable Certificates, Ambac
Certificate Guarantee Insurance Policy No. AB0543BE, together with the
Certificate Guaranty Insurance Policy Endorsement attached thereto, issued
as of the Closing Date, as amended, supplemented or otherwise modified
from time to time in accordance with its terms.
POLICY PROVIDER: Has the meaning specified in the Intercreditor
Agreement.
POLICY PROVIDER AGREEMENT: Has the meaning specified in the
Intercreditor Agreement.
POLICY PROVIDER DEFAULT: Has the meaning specified in the
Intercreditor Agreement.
POOL BALANCE: Means, as of any date, (i) the original aggregate face
amount of the "Applicable Certificates" as defined in the Related Pass
Through Trust Agreement, less (ii) the aggregate amount of all payments
made as of such date in respect of such Certificates, the Applicable
Certificates (as defined in the Related Pass Through Trust Agreement) or
the Deposits, other than payments made in respect of interest or premium,
Make-Whole Amount or Deposit Make-Whole Premium thereon or reimbursement
of any costs or expenses incurred in connection therewith. The Pool
Balance as of any date shall be computed after giving effect to any
special distribution with respect to unused Deposits, payment of principal
of the Equipment Notes, payments under the Policy (other than in respect
of interest on the Applicable Certificates) or payment with respect to
other Trust Property and the distribution thereof to be made on that date.
POOL FACTOR: Means, as of any Distribution Date, the quotient
(rounded to the seventh decimal place) computed by dividing (i) the Pool
Balance by (ii) the original aggregate face amount of the "Applicable
Certificates" as defined in the Related Pass Through Trust Agreement. The
Pool Factor as of any Distribution Date shall be computed after giving
effect to any special distribution with respect to unused Deposits,
payment of principal of the Equipment Notes, payment under the Policy
(other than in respect of interest on the Applicable Certificates) or
payment with respect to other Trust Property and the distribution thereof
to be made on that date.
PRIMARY LIQUIDITY FACILITY: Means, initially, the Revolving Credit
Agreement dated as of March 25, 2002 relating to the Applicable
Certificates, between the Primary Liquidity Provider and Wilmington Trust
Company, as Subordination Agent, as agent and trustee for the Applicable
Trust, and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement primary liquidity facility
therefor, in each case as amended, supplemented or otherwise modified from
time to time in accordance with their respective terms.
PRIMARY LIQUIDITY PROVIDER: Means, initially, Landesbank
Hessen-Thuringen Girozentrale, a German public law institution duly
established under the Treaty on the Formation of a Joint Savings Banks
Organization Hessen-Thuringen, and any replacements or successors therefor
appointed in accordance with the Intercreditor Agreement.
PROSPECTUS SUPPLEMENT: Means the final Prospectus Supplement dated
March 11, 2002 relating to the offering of the Applicable Certificates and
the Class G-1 Certificates.
RATINGS CONFIRMATION: Has the meaning specified in the Intercreditor
Agreement.
REFERENCE AGENCY AGREEMENT: Has the meaning specified in the NPA.
RELATED OTHER PASS THROUGH TRUST AGREEMENTS: Means the "Other
Agreements" as defined in the Related Pass Through Trust Agreement.
RELATED OTHER TRUSTEES: Means the "Other Trustees" as defined in the
Related Pass Through Trust Agreement.
RELATED OTHER TRUSTS: Means "Other Trusts" as defined in the Related
Pass Through Trust Agreement.
RELATED PASS THROUGH TRUST AGREEMENT: Means the Means the Basic
Agreement as supplemented by the Trust Supplement No. 2002-1G-2-O dated as
of the date hereof (the "RELATED PASS THROUGH TRUST SUPPLEMENT"), relating
to the Continental Airlines Pass Through Trust 2002-1G-2-O and entered
into by the Company and the Related Trustee, as amended, supplemented or
otherwise modified from time to time in accordance with its terms.
RELATED TRUST: Means the Continental Pass Through Trust 2002-1G-2-O,
formed under the Related Pass Through Trust Agreement.
RELATED TRUSTEE: Means the trustee under the Related Pass Through
Trust Agreement.
SCHEDULED PAYMENT: Means, with respect to any Equipment Note, (i)
any payment of principal or interest on such Equipment Note (other than
any such payment which is not in fact received by the Trustee or any
Subordination Agent within five days of the date on which such payment is
scheduled to be made) or (ii) any payment of interest on the Applicable
Certificates with funds drawn under the Primary Liquidity Facility or any
payment of interest on or principal of the Applicable Certificates with
funds drawn under the Policy, which payment in any such case represents
the installment of principal on such Equipment Note at the stated maturity
of such installment, the payment of regularly scheduled interest accrued
on the unpaid principal amount of such Equipment Note, or both; PROVIDED,
HOWEVER, that any payment of principal, premium, Make-Whole Amount or
Deposit Make-Whole Premium, if any, or interest resulting from the
redemption or purchase of any Equipment Note shall not constitute a
Scheduled Payment.
SPECIAL PAYMENT: Means any payment (other than a Scheduled Payment)
in respect of, or any proceeds of, any Equipment Note, Collateral (as
defined in each Indenture) or Deposit Make-Whole Premium.
SUBSTITUTE AIRCRAFT: Has the meaning specified in the NPA.
TRANSFER DATE: Means the moment of execution and delivery of the
Assignment and Assumption Agreement by each of the parties thereto.
TRANSFER DATE CERTIFICATES: Has the meaning specified in the
definition of "Applicable Certificates".
TRIGGERING EVENT: Has the meaning assigned to such term in the
Intercreditor Agreement.
TRUST PROPERTY: Means (i) subject to the Intercreditor Agreement,
the Equipment Notes held as the property of the Applicable Trust, all
monies at any time paid thereon and all monies due and to become due
thereunder, (ii) funds from time to time deposited in the Certificate
Account and the Special Payments Account and, subject to the Intercreditor
Agreement, any proceeds from the sale by the Trustee pursuant to Article
VI of the Basic Agreement of any Equipment Note and (iii) all rights of
the Applicable Trust and the Trustee, on behalf of the Applicable Trust,
under the Intercreditor Agreement, the Escrow Agreement, the NPA, the
Primary Liquidity Facility and the Policy, including, without limitation,
all rights to receive certain payments thereunder, and all monies paid to
the Trustee on behalf of the Applicable Trust pursuant to the
Intercreditor Agreement, the Primary Liquidity Facility or the Policy,
PROVIDED that rights with respect to the Deposits or under the Escrow
Agreement, will not constitute Trust Property.
TRUST SUPPLEMENT: Has the meaning specified in the first paragraph
of this trust supplement.
TRUSTEE: Has the meaning specified in the first paragraph of this
Trust Supplement.
UNDERWRITERS: Means, collectively, Credit Suisse First Boston
Corporation, J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Salomon Smith Barney Inc. and Morgan Stanley & Co.
Incorporated.
UNDERWRITING AGREEMENT: Means the Underwriting Agreement dated March
11, 2002 among the Underwriters, the Company and the Depositary, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
ARTICLE III
CERTIFICATES; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. STATEMENTS TO APPLICABLE CERTIFICATEHOLDERS. (a) On
each Distribution Date, the Trustee will include with each distribution to
Applicable Certificateholders of a Scheduled Payment or Special Payment, as the
case may be, a statement setting forth the information provided below (in the
case of a Special Payment, reflecting in part the information provided by the
Escrow Paying Agent under the Escrow Agreement). Such statement shall set forth
(per $1,000 face amount Applicable Certificate as to (ii), (iii), (iv) and (v)
below) the following information:
(i) the aggregate amount of funds distributed on such Distribution
Date under the Agreement and under the Escrow Agreement, indicating the
amount allocable to each source, including any portion thereof paid by the
Primary Liquidity Provider or the Policy Provider;
(ii) the amount of such distribution under the Agreement allocable
to principal and the amount allocable to premium, Make-Whole Amount or
Deposit Make-Whole Premium, if any;
(iii) the amount of such distribution under the Agreement allocable
to interest;
(iv) the amount of such distribution under the Escrow Agreement
allocable to interest;
(v) the amount of such distribution under the Escrow Agreement
allocable to unused Deposits, if any; and
(vi) the Pool Balance and the Pool Factor.
With respect to the Applicable Certificates registered in the name
of a Clearing Agency, on the Record Date prior to each Distribution Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such Record Date. On each Distribution Date, the Trustee will mail to each such
Clearing Agency Participant the statement described above and will make
available additional copies as requested by such Clearing Agency Participant for
forwarding to holders of interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was an
Applicable Certificateholder of record a statement containing the sum of the
amounts determined pursuant to clauses (a)(i), (a)(ii), (a)(iii), (a)(iv) and
(a)(v) above for such calendar year or, in the event such Person was an
Applicable Certificateholder of record during a portion of such calendar year,
for such portion of such year, and such other items as are readily available to
the Trustee and which an Applicable Certificateholder shall reasonably request
as necessary for the purpose of such Applicable Certificateholder's preparation
of its U.S. federal income tax returns. Such statement and such other items
shall be prepared on the basis of information supplied to the Trustee by the
Clearing Agency Participants and shall be delivered by the Trustee to such
Clearing Agency Participants to be available for forwarding by such Clearing
Agency Participants to the holders of interests in the Applicable Certificates
in the manner described in Section 3.01(a) of this Trust Supplement.
(c) If the aggregate principal payments scheduled for a Regular
Distribution Date prior to the Delivery Period Termination Date differ from the
amount thereof set forth for the Applicable Certificates on page S-42 of the
Prospectus Supplement, by no later than the 15th day prior to such Regular
Distribution Date, the Trustee (if the Related Trustee has not already done so)
shall mail written notice of the actual amount of such scheduled payments to the
Applicable Certificateholders of record as of a date within 15 Business Days
prior to the date of mailing.
(d) Promptly following (i) the Delivery Period Termination Date, if
there has been any change in the information set forth in clauses (y) and (z)
below from that set forth in page S-42 of the Prospectus Supplement, and (ii)
the date of any early redemption or purchase of, or any default in the payment
of principal or interest in respect of, any of the Equipment Notes held in the
Applicable Trust, or any Final Withdrawal, the Trustee (if the Related Trustee
has not already done so) shall furnish to Applicable Certificateholders of
record on such date a statement setting forth (x) the expected Pool Balances for
each subsequent Regular Distribution Date following the Delivery Period
Termination Date, (y) the related Pool Factors for such Regular Distribution
Dates and (z) the expected principal distribution schedule of the Equipment
Notes, in the aggregate, held as Trust Property at the date of such notice. With
respect to the Applicable Certificates registered in the name of a Clearing
Agency, on the Transfer Date, the Trustee (if the Related Trustee has not
already done so) will request from such Clearing Agency a securities position
listing setting forth the names of all Clearing Agency Participants reflected on
such Clearing Agency's books as holding interests in the "Applicable
Certificates" (as defined in the Related Pass Through Trust Agreement) on the
Delivery Period Termination Date. The Trustee (if the Related Trustee has not
already done so) will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as requested
by such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(e) This Section 3.01 supersedes and replaces Section 4.03 of the
Basic Agreement, with respect to the Applicable Trust.
Section 3.02. SPECIAL PAYMENTS ACCOUNT. (a) The Trustee shall
establish and maintain on behalf of the Applicable Certificateholders a Special
Payments Account as one or more accounts, which shall be non-interest bearing
except as provided in Section 4.04 of the Basic Agreement. The Trustee shall
hold the Special Payments Account in trust for the benefit of the Applicable
Certificateholders and shall make or permit withdrawals therefrom only as
provided in the Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement and upon the payment of
the Deposit Make-Whole Premium to the Trustee under the NPA, the Trustee, upon
receipt thereof, shall immediately deposit the aggregate amount of such Special
Payments in the Special Payments Account.
(b) This Section 3.02 supersedes and replaces Section 4.01(b) of the
Basic Agreement in its entirety, with respect to the Applicable Trust.
Section 3.03. DISTRIBUTIONS FROM SPECIAL PAYMENTS ACCOUNT. (a) On
each Special Distribution Date with respect to any Special Payment or as soon
thereafter as the Trustee has confirmed receipt of any Special Payments due on
the Equipment Notes held (subject to the Intercreditor Agreement) in the
Applicable Trust or realized upon the sale of such Equipment Notes or receipt of
the Deposit Make-Whole Premium, the Trustee shall distribute out of the Special
Payments Account the entire amount of such Special Payment deposited therein
pursuant to Section 3.02(a) of this Trust Supplement. There shall be so
distributed to each Applicable Certificateholder of record on the Record Date
with respect to such Special Distribution Date (other than as provided in
Section 7.01 of this Trust Supplement concerning the final distribution) by
check mailed to such Applicable Certificateholder, at the address appearing in
the Register, such Applicable Certificateholder's pro rata share (based on the
Fractional Undivided Interest in the Applicable Trust held by such Applicable
Certificateholder) of the total amount in the Special Payments Account on
account of such Special Payment, except that, with respect to Applicable
Certificates registered on the Record Date in the name of a Clearing Agency (or
its nominee), such distribution shall be made by wire transfer in immediately
available funds to the account designated by such Clearing Agency (or such
nominee).
(b) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Applicable Certificateholder at his
address as it appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the Applicable Trust, such notice shall be mailed not
less than 15 days prior to the Special Distribution Date for the Special Payment
resulting from such redemption or purchase, which Special Distribution Date
shall be the date of such redemption or purchase. In the case of any
distribution pursuant to Section 3.7(c) or Section 3.7(e) of the Intercreditor
Agreement, the Trustee will mail notice to the Applicable Certificateholders not
less than 15 days prior to the Special Distribution Date determined for such
distribution. In the event of the payment of a Deposit Make-Whole Premium by the
Company to the Trustee under the NPA, such notice shall be mailed, together with
the notice by the Escrow Paying Agent under Section 2.07 of the Escrow
Agreement, not less than 15 days prior to the Special Distribution Date for such
amount. In the case of any other Special Payments, such notice shall be mailed
as soon as practicable after the Trustee has confirmed that it has received
funds for such Special Payment, stating the Special Distribution Date for such
Special Payment which shall occur not less than 15 days after the date of such
notice and as soon as practicable thereafter. Notices mailed by the Trustee
shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 7.01 of this Trust Supplement),
(ii) the amount of the Special Payment for each $1,000 face amount
Applicable Certificate and the amount thereof constituting principal,
premium, Make-Whole Amount or Deposit Make-Whole Premium, if any, and
interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date, the total amount to be received on such date for each
$1,000 face amount Applicable Certificate.
If the amount of (i) premium or Make-Whole Amount, if any, payable upon the
redemption or purchase of an Equipment Note or (ii) the Deposit Make-Whole
Premium, if any, has not been calculated at the time that the Trustee mails
notice of a Special Payment, it shall be sufficient if the notice sets forth the
other amounts to be distributed and states that any premium, Make-Whole Amount
or Deposit Make-Whole Premium received will also be distributed.
If any redemption of the Equipment Notes held in the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Applicable Certificateholder at its address
as it appears on the Register.
(b) This Section 3.03 supersedes and replaces Section 4.02(b) and
Section 4.02(c) of the Basic Agreement in their entirety, with respect to the
Applicable Trust.
Section 3.04. LIMITATION OF LIABILITY FOR PAYMENTS. Section 3.09 of
the Basic Agreement shall be amended, with respect to the Applicable Trust, by
deleting the phrase "the Owner Trustees or the Owner Participants" in the second
sentence thereof and adding in lieu thereof " the Primary Liquidity Provider or
the Policy Provider".
ARTICLE IV
DEFAULT
Section 4.01. PURCHASE RIGHTS OF CERTIFICATEHOLDERS. (a) At any time
after the occurrence and during the continuation of a Triggering Event, if the
Class G-1 Trustee is then the Controlling Party, each Applicable
Certificateholder (other than the Company or any of its Affiliates) shall have
the right to purchase, for the purchase price set forth in the Class G-1 Trust
Agreement, all, but not less than all, of the Class G-1 Certificates upon ten
days' written notice to the Class G-1 Trustee and each other Applicable
Certificateholder, PROVIDED that (i) if prior to the end of such ten-day period
any other Applicable Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Applicable Certificateholder that such
other Applicable Certificateholder wants to participate in such purchase, then
such other Applicable Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Applicable Certificateholder to
purchase all, but not less than all, of the Class G-1 Certificates pro rata
based on the Fractional Undivided Interest in the Applicable Trust held by each
such Applicable Certificateholder and (ii) if prior to the end of such ten-day
period any other Applicable Certificateholder fails to notify the purchasing
Applicable Certificateholder of such other Applicable Certificateholder's desire
to participate in such a purchase, then such other Applicable Certificateholder
shall lose its right to purchase the Class G-1 Certificates pursuant to this
Section 4.01(a).
(b) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after the occurrence and during the
continuation of a Triggering Event,
(i) if the Trustee is then the Controlling Party, each Class G-1
Certificateholder (other than the Company or any of its Affiliates) shall
have the right to purchase all, but not less than all, of the Applicable
Certificates upon ten days' written notice to the Trustee and each other
Class G-1 Certificateholder, PROVIDED that (A) if prior to the end of such
ten-day period any other Class G-1 Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Class G-1
Certificateholder that such other Class G-1 Certificateholder wants to
participate in such purchase, then such other Class G-1 Certificateholder
(other than the Company or any of its Affiliates) may join with the
purchasing Class G-1 Certificateholder to purchase all, but not less than
all, of the Applicable Certificates pro rata based on the Fractional
Undivided Interest in the Class G-1 Trust held by each such Class G-1
Certificateholder and (B) if prior to the end of such ten-day period any
other Class G-1 Certificateholder fails to notify the purchasing Class G-1
Certificateholder of such other Class G-1 Certificateholder's desire to
participate in such a purchase, then such other Class G-1
Certificateholder shall lose its right to purchase the Applicable
Certificates pursuant to this Section 4.01(b)(i);
(ii) each Class H Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a) or (b)(i)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice
to the Trustee, the Class G-1 Trustee and each other Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Class H Certificateholder (other than the Company or any
of its Affiliates) notifies such purchasing Class H Certificateholder that
such other Class H Certificateholder wants to participate in such
purchase, then such other Class H Certificateholder (other than the
Company or any of its Affiliates) may join with the purchasing Class H
Certificateholder to purchase all, but not less than all, of the
Applicable Certificates and the Class G-1 Certificates pro rata based on
the Fractional Undivided Interest in the Class H Trust held by each such
Class H Certificateholder and (B) if prior to the end of such ten-day
period any other Class H Certificateholder fails to notify the purchasing
Class H Certificateholder of such other Class H Certificateholder's desire
to participate in such a purchase, then such other Class H
Certificateholder shall lose its right to purchase the Applicable
Certificates and the Class G-1 Certificates pursuant to this Section
4.01(b)(ii);
(iii) if Re-Issued Class H Certificates are issued, each Re-Issued
Class H Certificateholder (other than the Company or any of its
Affiliates) shall have the right (which shall not expire upon any purchase
of the Applicable Certificates pursuant to clause (a), (b)(i) or (b)(ii)
above) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice
to the Trustee, the Class G-1 Trustee and each other Re-Issued Class H
Certificateholder, PROVIDED that (A) if prior to the end of such ten-day
period any other Re-Issued Class H Certificateholder (other than the
Company or any of its Affiliates) notifies such purchasing Re-Issued Class
H Certificateholder that such other Re-Issued Class H Certificateholder
wants to participate in such purchase, then such other Re-Issued Class H
Certificateholder (other than the Company or any of its Affiliates) may
join with the purchasing Re-Issued Class H Certificateholder to purchase
all, but not less than all, of the Applicable Certificates and the Class
G-1 Certificates pro rata based on the Fractional Undivided Interest in
the Re-Issued Class H Trust held by each such Re-Issued Class H
Certificateholder and (B) if prior to the end of such ten-day period any
other Re-Issued Class H Certificateholder fails to notify the purchasing
Re-Issued Class H Certificateholder of such other Re-Issued Class H
Certificateholder's desire to participate in such a purchase, then such
other Re-Issued Class H Certificateholder shall lose its right to purchase
the Applicable Certificates and the Class G-1 Certificates pursuant to
this Section 4.01(b)(iii);
(iv) each Class I Certificateholder (other than the Company or any
of its Affiliates) shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii) or (b)(iii) above) to purchase all, but not less than all, of the
Applicable Certificates, the Class G-1 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) upon ten
days' written notice to the Trustee, the Class G-1 Trustee, the Class H
Trustee (or, if any Re-Issued Class H Certificates have been issued, the
Re-Issued Class H Trustee) and each other Class I Certificateholder,
PROVIDED that (A) if prior to the end of such ten-day period any other
Class I Certificateholder (other than the Company or any of its
Affiliates) notifies such purchasing Class I Certificateholder that such
other Class I Certificateholder wants to participate in such purchase,
then such other Class I Certificateholder (other than the Company or any
of its Affiliates) may join with the purchasing Class I Certificateholder
to purchase all, but not less than all, of the Applicable Certificates,
the Class G-1 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) pro rata based on the Fractional Undivided
Interest in the Class I Trust held by each such Class I Certificateholder
and (B) if prior to the end of such ten-day period any other Class I
Certificateholder fails to notify the purchasing Class I Certificateholder
of such other Class I Certificateholder's desire to participate in such a
purchase, then such other Class I Certificateholder shall lose its right
to purchase the Applicable Certificates, the Class G-1 Certificates, the
Class H Certificates (or, if issued, the Re-Issued Class H Certificates)
pursuant to this Section 4.01(b)(iv); and
(v) each Class J Certificateholder, other than the Company or any of
its Affiliates, shall have the right (which shall not expire upon any
purchase of the Applicable Certificates pursuant to clause (a), (b)(i),
(b)(ii), (b)(iii) or (b)(iv) above) to purchase all, but not less than
all, of the Applicable Certificates, the Class G-1 Certificates, the Class
H Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates upon ten days' written notice to the Trustee, the
Class G-1 Trustee, the Class H Trustee (or, if any Re-Issued Class H
Certificates have been issued, the Re-Issued Class H Trustee), the Class I
Trustee and each other Class J Certificateholder, PROVIDED that (A) if
prior to the end of such ten-day period any other Class J
Certificateholder (other than the Company or any of its Affiliates)
notifies such purchasing Class J Certificateholder that such other Class J
Certificateholder wants to participate in such purchase, then such other
Class J Certificateholder (other than the Company or any of its
Affiliates) may join with the purchasing Class J Certificateholder to
purchase all, but not less than all, of the Applicable Certificates, the
Class G-1 Certificates, the Class H Certificates (or, if issued, the
Re-Issued Class H Certificates) and the Class I Certificates pro rata
based on the Fractional Undivided Interest in the Class J Trust held by
each such Class J Certificateholder and (B) if prior to the end of such
ten-day period any other Class J Certificateholder fails to notify the
purchasing Class J Certificateholder of such other Class J
Certificateholder's desire to participate in such a purchase, then such
other Class J Certificateholder shall lose its right to purchase the
Applicable Certificates, the Class G-1 Certificates, the Class H
Certificates (or, if issued, the Re-Issued Class H Certificates) and the
Class I Certificates pursuant to this Section 4.01(b)(v).
(c) By acceptance of its Applicable Certificate, each Applicable
Certificateholder agrees that at any time after 180 days have elapsed since the
occurrence of a Triggering Event that is continuing, regardless of whether the
Applicable Certificateholders exercise their right to purchase the Class G-1
Certificates pursuant to Section 4.01(a), the Policy Provider, if it is then the
Controlling Party, shall have the right (except in the event of a Policy
Provider Default) to purchase all, but not less than all, of the Applicable
Certificates and the Class G-1 Certificates upon ten days' written notice to the
Trustee, the Class G-1 Trustee, the Applicable Certificateholders and the Class
G-1 Certificateholders.
The purchase price with respect to the Applicable Certificates shall
be equal to the Pool Balance of the Applicable Certificates, together with
accrued and unpaid interest thereon to the date of such purchase, without
premium, but including any other amounts then due and payable to the Applicable
Certificateholders under the Agreement, the Intercreditor Agreement, the Escrow
Agreement or any Note Document or on or in respect of the Applicable
Certificates; PROVIDED, HOWEVER, that no such purchase of Applicable
Certificates shall be effective unless the purchaser(s) shall certify to the
Trustee that contemporaneously with such purchase, such purchaser(s) is (are)
purchasing, pursuant to the terms of the Agreement and the Other Agreements
(and, if any Re-Issued Class H Certificates have been issued, the pass through
trust agreement relating thereto), (A) in the case of any purchase of the
Applicable Certificates pursuant to clause (b)(i) above, all of the Applicable
Certificates, (B) in the case of any purchase of the Applicable Certificates
pursuant to clause (c) above, all of the Applicable Certificates and the Class
G-1 Certificates, or (C) in all other cases, the Applicable Certificates, the
Class G-1 Certificates, the Class H Certificates (or, if issued, the Re-Issued
Class H Certificates) and the Class I Certificates that are senior to the
securities held by such purchaser(s). Each payment of the purchase price of the
Applicable Certificates referred to in the first sentence hereof shall be made
to an account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01. Each Applicable Certificateholder
agrees by its acceptance of its Applicable Certificate that (at any time after
the occurrence and during the continuation of a Triggering Event) it will, upon
payment from such Class G-1 Certificateholder(s), Class H Certificateholder(s)
(or, if any Re-Issued Class H Certificates have been issued, Re-Issued Class H
Certificateholder(s)), Class I Certificateholder(s), Class J
Certificateholder(s) or the Policy Provider, as the case may be, of the purchase
price set forth in the first sentence of this paragraph, (i) forthwith sell,
assign, transfer and convey to the purchaser(s) thereof (without recourse,
representation or warranty of any kind except for its own acts), all of the
right, title, interest and obligation of such Applicable Certificateholder in
the Agreement, the Escrow Agreement, the Deposit Agreement, the Intercreditor
Agreement, the Primary Liquidity Facility, the Policy, the NPA, the Note
Documents and all Applicable Certificates and Escrow Receipts held by such
Applicable Certificateholder (excluding all right, title and interest under any
of the foregoing to the extent such right, title or interest is with respect to
an obligation not then due and payable as respects any action or inaction or
state of affairs occurring prior to such sale) (and the purchaser shall assume
all of such Applicable Certificateholder's obligations under the Agreement, the
Escrow Agreement, the Deposit Agreement, the Intercreditor Agreement, the
Primary Liquidity Facility, the Policy, the NPA, the Note Documents and all such
Applicable Certificates and Escrow Receipts), (ii) if such purchase occurs after
a record date specified in Section 2.03 of the Escrow Agreement relating to the
distribution of unused Deposits and/or accrued and unpaid interest on Deposits
and prior to or on the related distribution date thereunder, forthwith turn over
to the purchaser(s) of its Applicable Certificate all amounts, if any, received
by it on account of such distribution, and (iii) if such purchase occurs after a
Record Date relating to any distribution and prior to or on the related
Distribution Date, forthwith turn over to the purchaser(s) of its Applicable
Certificate all amounts, if any, received by it on account of such distribution.
The Applicable Certificates will be deemed to be purchased on the date payment
of the purchase price is made notwithstanding the failure of the Applicable
Certificateholders to deliver any Applicable Certificates and, upon such a
purchase, (I) the only rights of the Applicable Certificateholders will be to
deliver the Applicable Certificates to the purchaser(s) and receive the purchase
price for such Applicable Certificates and (II) if the purchaser(s) shall so
request, such Applicable Certificateholder will comply with all the provisions
of Section 3.04 of the Basic Agreement to enable new Applicable Certificates to
be issued to the purchaser in such denominations as it shall request. All
charges and expenses in connection with the issuance of any such new Applicable
Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01 and elsewhere in this Trust Supplement,
the terms "Class G-1 Certificate", "Class G-1 Certificateholder", "Class G-1
Trust", "Class G-1 Trust Agreement", "Class G-1 Trustee", "Class H Certificate",
"Class H Certificateholder", "Class H Trust", "Class H Trustee", "Class I
Certificate", "Class I Certificateholder", "Class I Trust", "Class I Trustee",
"Class J Certificate", "Class J Certificateholder", "Class J Trust", "Re-Issued
Class H Certificate", "Re-Issued Class H Certificateholder", "Re-Issued Class H
Trust" and "Re-Issued Class H Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(d) This Section 4.01 supersedes and replaces Section 6.01(b) of the
Basic Agreement, with respect to the Applicable Trust.
Section 4.02. AMENDMENT OF SECTION 6.05 OF THE BASIC AGREEMENT.
Section 6.05 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by deleting the phrase "and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto," set forth in the first sentence thereof.
ARTICLE V
THE TRUSTEE
Section 5.01. ACQUISITION OF TRUST PROPERTY. (a) The Trustee is
hereby irrevocably authorized and directed to execute and deliver the Assignment
and Assumption Agreement on the date specified in Section 7.01 of the Related
Pass Through Trust Supplement, subject only to the satisfaction of the
conditions set forth in said Section 7.01. The Agreement (except only for this
sentence and the immediately preceding sentence hereof, which are effective upon
execution and delivery hereof) shall become effective upon the execution and
delivery of the Assignment and Assumption Agreement by the Trustee and the
Related Trustee, automatically and without any further signature or action on
the part of the Company and the Trustee, and shall thereupon constitute the
legal, valid and binding obligation of the parties hereto enforceable against
each of the parties hereto in accordance with its terms. Upon such execution and
delivery of the Assignment and Assumption Agreement, the Related Trust shall be
terminated, the Applicable Certificateholders shall receive beneficial interests
in the Applicable Trust in exchange for their interests in the Related Trust
equal to their respective beneficial interests in the Related Trust and the
"Outstanding" (as defined in the Related Pass Through Trust Agreement) pass
through certificates representing fractional undivided interests in the Related
Trust shall be deemed for all purposes of the Agreement, without further
signature or action of any party or Certificateholder, to be Certificates
representing the same Fractional Undivided Interests in the Trust and Trust
Property. By acceptance of its Applicable Certificate, each Applicable
Certificateholder consents to and ratifies such assignment, transfer and
delivery of the trust property of the Related Trust to the Trustee upon the
execution and delivery of the Assignment and Assumption Agreement. The
provisions of this Section 5.01(a) supersede and replace the provisions of
Section 2.02 of the Basic Agreement with respect to the Applicable Trust, and
all provisions of the Basic Agreement relating to Postponed Notes or Section
2.02 of the Basic Agreement shall not apply to the Applicable Trust.
(b) The Trustee, upon the execution and delivery of the Assignment
and Assumption Agreement, acknowledges its acceptance of all right, title and
interest in and to the Trust Property and declares that the Trustee holds and
will hold such right, title and interest for the benefit of all then present and
future Applicable Certificateholders, upon the trusts herein and in the Basic
Agreement set forth. By the acceptance of each Applicable Certificate issued to
it under the Related Pass Through Trust Agreement and deemed issued under the
Agreement, each Holder of any such Applicable Certificate as grantor of the
Applicable Trust thereby joins in the creation and declaration of the Applicable
Trust. The provisions of this Section 5.01(b) supersede and replace the
provisions of Section 2.03 of the Basic Agreement, with respect to the
Applicable Trust.
Section 5.02. [Intentionally Omitted]
Section 5.03. THE TRUSTEE. (a) Subject to Section 5.04 of this Trust
Supplement and Section 7.15 of the Basic Agreement, the Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Trust Supplement, the Deposit Agreement, the NPA or the
Escrow Agreement or the due execution hereof or thereof by the Company or the
other parties thereto (other than the Trustee), or for or in respect of the
recitals and statements contained herein or therein, all of which recitals and
statements are made solely by the Company, except that the Trustee hereby
represents and warrants that each of this Trust Supplement, the Basic Agreement,
each Applicable Certificate, the Intercreditor Agreement, the NPA and the Escrow
Agreement has been executed and delivered by one of its officers who is duly
authorized to execute and deliver such document on its behalf.
(b) Except as herein otherwise provided and except during the
continuation of an Event of Default in respect of the Applicable Trust created
hereby, no duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this Trust Supplement other
than as set forth in the Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions set
forth in the Agreement, as fully to all intents as if the same were herein set
forth at length.
Section 5.04. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants, on the Transfer Date, that:
(a) the Trustee has full power, authority and legal right to receive
the Trust Property assigned by the Related Trustee, assume the obligations
under, and perform the Assignment and Assumption Agreement, this Trust
Supplement, the Intercreditor Agreement, the Escrow Agreement, the NPA and
the Note Documents to which it is a party and has taken all necessary
action to authorize such receipt, assumption and performance by it of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
NPA and the Note Documents to which it is a party;
(b) the receipt of the Trust Property under the Assignment and
Assumption Agreement and the performance by the Trustee of the Assignment
and Assumption Agreement, this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party (i) will not violate any provision of any United States
federal law or the law of the state of the United States where it is
located governing the banking and trust powers of the Trustee or any
order, writ, judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will not
violate any provision of the articles of association or by-laws of the
Trustee, and (iii) will not violate any provision of, or constitute, with
or without notice or lapse of time, a default under, or result in the
creation or imposition of any lien on any properties included in the Trust
Property pursuant to the provisions of any mortgage, indenture, contract,
agreement or other undertaking to which it is a party, which violation,
default or lien could reasonably be expected to have an adverse effect on
the Trustee's performance or ability to perform its duties hereunder or
thereunder or on the transactions contemplated herein or therein;
(c) the receipt of the Trust Property under the Assignment and
Assumption Agreement and the performance by the Trustee of the Assignment
and Assumption Agreement, this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party will not require the authorization, consent, or approval of,
the giving of notice to, the filing or registration with, or the taking of
any other action in respect of, any governmental authority or agency of
the United States or the state of the United States where it is located
regulating the banking and corporate trust activities of the Trustee; and
(d) the Assignment and Assumption Agreement has been duly executed
and delivered by the Trustee and this Trust Supplement, the Intercreditor
Agreement, the Escrow Agreement, the NPA and the Note Documents to which
it is a party have been, or will be, as applicable, duly executed and
delivered by the Trustee and constitute, or will constitute, as
applicable, the legal, valid and binding agreements of the Trustee,
enforceable against it in accordance with their respective terms;
PROVIDED, HOWEVER, that enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and (ii) general principles of
equity.
Section 5.05. TRUSTEE LIENS. The Trustee in its individual capacity
agrees, in addition to the agreements contained in Section 7.17 of the Basic
Agreement, that it will at its own cost and expense promptly take any action as
may be necessary to duly discharge and satisfy in full any Trustee's Liens on or
with respect to the Trust Property which is attributable to the Trustee in its
individual capacity and which is unrelated to the transactions contemplated by
the Intercreditor Agreement or the NPA.
ARTICLE VI
ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS
Section 6.01. AMENDMENT OF SECTION 5.02 OF THE BASIC AGREEMENT.
Section 5.02 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by (i) replacing the phrase "of the Note Documents and of this
Agreement" set forth in paragraph (b) thereof with the phrase "of the Note
Documents, of the NPA and of this Agreement" and (ii) replacing the phrase "of
this Agreement and any Note Document" set forth in the last paragraph of Section
5.02 with the phrase "of this Agreement, the NPA and any Note Document".
Section 6.02. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.01 of the Basic Agreement,
under the terms of, and subject to the limitations contained in, Section 9.01 of
the Basic Agreement, the Company may (but will not be required to), and the
Trustee (subject to Section 9.03 of the Basic Agreement) shall, at the Company's
request, at any time and from time to time, (i) enter into one or more
agreements supplemental to the Escrow Agreement, the NPA, the Deposit Agreement,
the Reference Agency Agreement, the Policy or the Policy Provider Agreement for
any of the purposes set forth in clauses (1) through (9) of such Section 9.01,
and (without limitation of the foregoing or Section 9.01 of the Basic Agreement)
(a) the reference in the introductory paragraph of Section 9.01 of the Basic
Agreement to a "Liquidity Facility" shall be deemed to refer to "the Primary
Liquidity Facility", (b) clauses (2) and (3) of such Section 9.01 shall also be
deemed to include the Company's obligations under (in the case of clause (2)),
and the Company's rights and powers conferred by (in the case of clause (3)),
the NPA, the Reference Agency Agreement, the Policy or the Policy Provider
Agreement, and (c) references in clauses (4), (6) and (7) of such Section 9.01
to "any Intercreditor Agreement or any Liquidity Facility" shall also be deemed
to refer to "the Intercreditor Agreement, the Primary Liquidity Facility, the
Escrow Agreement, the Reference Agency Agreement, the NPA, the Deposit
Agreement, the Policy or the Policy Provider Agreement", (ii) enter into one or
more agreements supplemental to the Agreement, the Intercreditor Agreement, the
Reference Agency Agreement or the NPA to provide for the formation of the
Re-Issued Class H Trust, the issuance of the Re-Issued Class H Certificates, the
purchase by the Re-Issued Class H Trust of Equipment Notes and other matters
incidental thereto or otherwise contemplated by Section 2.01(b) of the Basic
Agreement; PROVIDED that (x) a Ratings Confirmation for the Applicable
Certificates and the Class G-1 Certificates shall have been obtained with
respect to such agreements and (y) the Company shall have certified to the
Trustee and to the Other Trustees that such agreements shall not materially and
adversely affect the Applicable Certificateholders or the Class G-1
Certificateholders and (iii) enter into one or more agreements supplemental to
the Agreement to provide for the formation of a Class J Trust, the issuance of
Class J Certificates, the purchase by the Class J Trust of Equipment Notes and
other matters incidental thereto or otherwise contemplated by Section 2.01(b) of
the Basic Agreement.
Section 6.03. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.02 of the Basic Agreement,
the provisions of Section 9.02 of the Basic Agreement shall apply to agreements
or amendments for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Escrow Agreement, the Deposit
Agreement, the Primary Liquidity Facility, the Reference Agency Agreement, the
NPA, the Policy or the Policy Provider Agreement or modifying in any manner the
rights and obligations of the Applicable Certificateholders under the Escrow
Agreement, the Deposit Agreement, the Primary Liquidity Facility, the Reference
Agency Agreement, the NPA, the Policy or the Policy Provider Agreement; PROVIDED
that the provisions of Section 9.02(1) of the Basic Agreement shall be deemed to
include reductions in any manner of, or delay in the timing of, any receipt by
the Applicable Certificateholders of payments upon the Deposits.
Section 6.04. CONSENT OF HOLDERS OF CERTIFICATES ISSUED UNDER OTHER
TRUSTS. Notwithstanding any provision in Section 6.02 or Section 6.03 of this
Trust Supplement to the contrary, no amendment or modification of Section 4.01
of this Trust Supplement shall be effective unless the trustee for each Class of
Certificates affected by such amendment or modification shall have consented
thereto.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. TERMINATION OF THE APPLICABLE TRUST. (a) The
respective obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the distribution to all
Applicable Certificateholders and the Trustee of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property; PROVIDED, HOWEVER, that in no event
shall the Applicable Trust continue beyond one hundred ten (110) years following
the date of the execution of this Trust Supplement.
Notice of any termination, specifying the Distribution Date upon
which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the 15th day
next preceding such final Distribution Date specifying (A) the Distribution Date
upon which the proposed final payment of the Applicable Certificates will be
made upon presentation and surrender of Applicable Certificates at the office or
agency of the Trustee therein specified, (B) the amount of any such proposed
final payment, and (C) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Applicable Certificates at the office or agency of the
Trustee therein specified. The Trustee shall give such notice to the Registrar
at the time such notice is given to Applicable Certificateholders. Upon
presentation and surrender of the Applicable Certificates in accordance with
such notice, the Trustee shall cause to be distributed to Applicable
Certificateholders such final payments.
In the event that all of the Applicable Certificateholders shall not
surrender their Applicable Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Trustee shall give
a second written notice to the remaining Applicable Certificateholders to
surrender their Applicable Certificates for cancellation and receive the final
distribution with respect thereto. No additional interest shall accrue on the
Applicable Certificates after the Distribution Date specified in the first
written notice. In the event that any money held by the Trustee for the payment
of distributions on the Applicable Certificates shall remain unclaimed for two
years (or such lesser time as the Trustee shall be satisfied, after sixty days'
notice from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money relating
to such Loan Trustee and shall give written notice thereof to the Company.
(b) The provisions of this Section 7.01 supersede and replace the
provisions of Section 11.01 of the Basic Agreement in its entirety, with respect
to the Applicable Trust.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. BASIC AGREEMENT RATIFIED. Except and so far as herein
expressly provided, all of the provisions, terms and conditions of the Basic
Agreement are in all respects ratified and confirmed; and the Basic Agreement
and this Trust Supplement shall be taken, read and construed as one and the same
instrument. All replacements of provisions of, and other modifications of the
Basic Agreement set forth in this Trust Supplement are solely with respect to
the Applicable Trust.
Section 8.02. GOVERNING LAW. THE AGREEMENT AND THE APPLICABLE
CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK. THIS SECTION 8.02 SUPERSEDES AND REPLACES SECTION 12.05
OF THE BASIC AGREEMENT, with respect to the Applicable Trust.
Section 8.03. EXECUTION IN COUNTERPARTS. This Trust Supplement may
be executed in any number of counterparts, each of which shall be an original,
but such counterparts shall together constitute but one and the same instrument.
Section 8.04. INTENTION OF PARTIES. The parties hereto intend that
the Applicable Trust be classified for U.S. federal income tax purposes as a
grantor trust under Subpart E, Part I of Subchapter J of the Internal Revenue
Code of 1986, as amended, and not as a trust or association taxable as a
corporation or as a partnership. Each Applicable Certificateholder and Investor,
by its acceptance of its Applicable Certificate or a beneficial interest
therein, agrees to treat the Applicable Trust as a grantor trust for all U.S.
federal, state and local income tax purposes. The powers granted and obligations
undertaken pursuant to the Agreement shall be so construed so as to further such
intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Trust Supplement to be duly executed by their respective officers thereto duly
authorized, as of the day and year first written above.
CONTINENTAL AIRLINES, INC.
By:
---------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
---------------------------------------
Name:
Title:
================================================================================
REVOLVING CREDIT AGREEMENT
(2002-1G-1)
DATED AS OF MARCH 25, 2002
BETWEEN
WILMINGTON TRUST COMPANY,
AS SUBORDINATION AGENT,
AS AGENT AND TRUSTEE FOR THE
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-1
AS BORROWER
AND
LANDESBANK HESSEN-THURINGEN GIROZENTRALE
AS PRIMARY LIQUIDITY PROVIDER
================================================================================
RELATING TO
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-1
USD 3-MONTH LIBOR + 0.45% CONTINENTAL AIRLINES PASS THROUGH CERTIFICATES,
SERIES 2002-1G-1
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS ........................................................1
Section 1.01. Certain Defined Terms......................................1
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT.................................8
Section 2.01. the Advances...............................................8
Section 2.02. Making the Advances........................................8
Section 2.03. Fees......................................................10
Section 2.04. Adjustments or Termination of the Maximum Commitment......10
Section 2.05. Repayments of Interest Advances or the Final Advance......10
Section 2.06. Repayments of Provider Advances...........................11
Section 2.07. Payments to the Primary Liquidity Provider Under
the Intercreditor Agreement ..............................12
Section 2.08. Book Entries..............................................12
Section 2.09. Payments From Available Funds Only........................12
Section 2.10. Extension of the Expiry Date; Non-extension Advance.......13
Section 2.11. Right to Further Extend Expiry Date.......................13
ARTICLE III OBLIGATIONS OF THE BORROWER......................................13
Section 3.01. Increased Costs...........................................13
Section 3.02. Capital Adequacy..........................................14
Section 3.03. Payments Free of Deductions...............................15
Section 3.04. Payments..................................................16
Section 3.05. Computations..............................................16
Section 3.06. Payment On Non-business Days..............................17
Section 3.07. Interest..................................................17
Section 3.08. Replacement of Borrower...................................18
Section 3.09. Funding Loss Indemnification..............................18
Section 3.10. Illegality................................................19
ARTICLE IV CONDITIONS PRECEDENT..............................................19
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.....19
Section 4.02. Conditions Precedent to Borrowing.........................21
ARTICLE V COVENANTS..........................................................21
Section 5.01. Affirmative Covenants of the Borrower.....................21
Section 5.02. Negative Covenants of the Borrower........................22
ARTICLE VI LIQUIDITY EVENTS OF DEFAULT.......................................22
Section 6.01. Liquidity Events of Default...............................22
ARTICLE VII MISCELLANEOUS....................................................23
Section 7.01. Amendments, Etc...........................................23
PAGE
Section 7.02. Notices, Etc..............................................23
Section 7.03. No Waiver; Remedies.......................................24
Section 7.04. Further Assurances........................................24
Section 7.05. Indemnification; Survival of Certain Provisions...........24
Section 7.06. Liability of the Primary Liquidity Provider...............24
Section 7.07. Costs, Expenses and Taxes.................................25
Section 7.08. Binding Effect; Participations............................25
Section 7.09. Third Party Beneficiary...................................27
Section 7.10. Severability..............................................27
Section 7.11. GOVERNING LAW.............................................27
Section 7.12. Submission to Jurisdiction; Waiver of Jury Trial;
Waiver of Immunity .......................................27
Section 7.13. Execution in Counterparts.................................28
Section 7.14. Entirety..................................................28
Section 7.15. Headings..................................................28
Section 7.16. Transfer..................................................28
Section 7.17. PRIMARY LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES..28
ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
Schedule 1 Capped LIBOR
REVOLVING CREDIT AGREEMENT (2002-1G-1)
This REVOLVING CREDIT AGREEMENT (2002-1G-1) dated as of March
25, 2002, between WILMINGTON TRUST COMPANY, a Delaware corporation, not in its
individual capacity but solely as Subordination Agent under the Intercreditor
Agreement (each as defined below), as agent and trustee for the Class G-1 Trust
(as defined below) (the "BORROWER"), and LANDESBANK HESSEN-THURINGEN
GIROZENTRALE, a public-law banking institution organized under the laws of
Germany (the "PRIMARY LIQUIDITY PROVIDER").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Class G-1 Trust Agreement (such term and
all other capitalized terms used in these recitals having the meanings set forth
or referred to in Section 1.01), the Class G-1 Trust is issuing the Class G-1
Certificates; and
WHEREAS, the Borrower, in order to support the timely payment of a
portion of the interest on the Class G-1 Certificates in accordance with their
terms, has requested the Primary Liquidity Provider to enter into this
Agreement, providing in part for the Borrower to request in specified
circumstances that Advances be made hereunder.
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms. (a) DEFINITIONS. As used in
this Agreement and unless otherwise expressly indicated, or unless the context
clearly requires otherwise, the following capitalized terms shall have the
following respective meanings for all purposes of this Agreement:
"ADDITIONAL COST" has the meaning assigned to such term in Section
3.01.
"ADVANCE" means an Interest Advance, a Final Advance, a Provider
Advance or an Applied Provider Advance, as the case may be.
"APPLICABLE LIQUIDITY RATE" has the meaning assigned to such term in
Section 3.07(g).
"APPLICABLE MARGIN" means (x) with respect to any Unpaid Advance or
Applied Provider Advance, 1.50% per annum, or (y) with respect to any
Unapplied Provider Advance, the rate per annum specified in the Fee
Letter.
"APPLIED DOWNGRADE ADVANCE" has the meaning assigned to such term in
Section 2.06(a).
"APPLIED NON-EXTENSION ADVANCE" has the meaning assigned to such
term in Section 2.06(a).
"APPLIED PROVIDER ADVANCE" has the meaning assigned to such term in
Section 2.06(a).
"ASSIGNMENT AND ASSUMPTION AGREEMENT" means the Assignment and
Assumption Agreement to be entered into between the Borrower and the
trustee of the Successor Trust, substantially in the form of Exhibit C to
the Trust Supplement No. 2002-1G-1-O, dated as of the date hereof,
relating to the Class G-1 Trust.
"BASE RATE" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to (a)
the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New
York, or if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day for such transactions
received by the Primary Liquidity Provider from three Federal funds
brokers of recognized standing selected by it, plus (b) one-quarter of one
percent (1/4 of 1%).
"BASE RATE ADVANCE" means an Advance that bears interest at a rate
based upon the Base Rate.
"BORROWER" has the meaning assigned to such term in the recital of
parties to this Agreement.
"BORROWING" means the making of Advances requested by delivery of a
Notice of Borrowing.
"BUSINESS DAY" means any day other than a Saturday or Sunday or a
day on which commercial banks are required or authorized to close in
Houston, Texas, New York, New York or, so long as any Class G-1
Certificate is outstanding, the city and state in which the Class G-1
Trustee, the Borrower or any Loan Trustee maintains its Corporate Trust
Office or receives or disburses funds, and, if the applicable Business Day
relates to any Advance or other amount bearing interest based on the LIBOR
Rate, on which dealings are carried on in the London interbank market.
"CAPPED INTEREST RATE" means, at any time, Capped LIBOR at such time
plus 0.45% per annum.
"CAPPED LIBOR" means, at any time, the rate per annum applicable at
such time as set forth in Schedule 1 hereto.
"CONSENT PERIOD" has the meaning specified in Section 2.10.
"DEPOSIT AGREEMENT" means the Deposit Agreement dated as of the date
hereof between Wells Fargo Bank Northwest, National Association, as Escrow
Agent, and Credit Suisse First Boston, New York Branch, as Depositary,
pertaining to the Class G-1 Certificates, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"DEPOSITARY" has the meaning assigned to such term in the Deposit
Agreement.
"DEPOSITS" has the meaning assigned to such term in the Deposit
Agreement.
"DOWNGRADE ADVANCE" means an Advance made pursuant to Section
2.02(c).
"DOWNGRADE EVENT" means a downgrading of the Primary Liquidity
Provider's short-term unsecured debt rating or issuer credit rating (as
applicable) issued by either Rating Agency below the applicable Threshold
Rating unless each Rating Agency shall have confirmed in writing on or
prior to the date of such downgrading that such downgrading will not
result in the downgrading, withdrawal or suspension of the ratings of the
Class G-1 Certificates (without regard to the Policies), in which case,
such downgrading of the Primary Liquidity Provider's short-term unsecured
debt rating or issuer credit rating (as applicable) shall not constitute a
Downgrade Event and shall be referred to herein as a "HELABA DOWNGRADE".
"EFFECTIVE DATE" has the meaning specified in Section 4.01. The
delivery of the certificate of the Primary Liquidity Provider contemplated
by Section 4.01(e) shall be conclusive evidence that the Effective Date
has occurred.
"EXCLUDED TAXES" means (i) taxes imposed on the overall net income
of the Primary Liquidity Provider or of its Facility Office by the
jurisdiction where such Primary Liquidity Provider's principal office or
such Facility Office is located, and (ii) Excluded Withholding Taxes.
"EXCLUDED WITHHOLDING TAXES" means (i) withholding Taxes imposed by
the United States except to the extent that such United States withholding
Taxes are imposed or increased as a result of any change in applicable law
(excluding from change in applicable law for this purpose a change in an
applicable treaty or other change in law affecting the applicability of a
treaty) after the date hereof, or in the case of a successor Primary
Liquidity Provider (including a transferee of an Advance) or Facility
Office, after the date on which such successor Primary Liquidity Provider
obtains its interest or on which the Facility Office is changed, and (ii)
any withholding Taxes imposed by the United States which are imposed or
increased as a result of the Primary Liquidity Provider failing to deliver
to the Borrower any certificate or document (which certificate or document
in the good faith judgment of the Primary Liquidity Provider it is legally
entitled to provide) which is reasonably requested by the Borrower to
establish that payments under this Agreement are exempt from (or entitled
to a reduced rate of) withholding Tax.
"EXPENSES" means liabilities, obligations, damages, settlements,
penalties, claims, actions, suits, costs, expenses, and disbursements
(including, without limitation, reasonable fees and disbursements of legal
counsel and costs of investigation), provided that Expenses shall not
include any Taxes.
"EXPIRY DATE" means March 23, 2003, initially, or any date to which
the Expiry Date is extended pursuant to Section 2.10 or 2.11.
"EXTENSION EFFECTIVE DATE" has the meaning assigned to such term in
Section 2.11.
"FACILITY OFFICE" means the office of the Primary Liquidity Provider
presently located at Frankfurt, Germany, or such other office as the
Primary Liquidity Provider from time to time shall notify the Borrower as
its Facility Office hereunder; provided that the Primary Liquidity
Provider shall not change its Facility Office to another Facility Office
outside the United States of America except in accordance with Section
3.01, 3.02 or 3.03 hereof.
"FINAL ADVANCE" means an Advance made pursuant to Section 2.02(d).
"GAAP" means generally accepted accounting principles as set forth
in the statements of financial accounting standards issued by the
Financial Accounting Standards Board of the American Institute of
Certified Public Accountants, as such principles may at any time or from
time to time be varied by any applicable financial accounting rules or
regulations issued by the Securities and Exchange Commission and, with
respect to any person, shall mean such principles applied on a basis
consistent with prior periods except as may be disclosed in such person's
financial statements.
"HELABA DOWNGRADE" has the meaning assigned to such term in the
definition of "Downgrade Event".
"INTERCREDITOR AGREEMENT" means the Intercreditor Agreement dated as
of the date hereof among the Trustees, the Primary Liquidity Provider, the
liquidity provider under the other Primary Liquidity Facility, the Class
G-1 Above-Cap Liquidity Provider, the Policy Provider and the
Subordination Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"INTEREST ADVANCE" means an Advance made pursuant to Section
2.02(a).
"INTEREST PERIOD" means, with respect to any LIBOR Advance, each of
the following periods:
(i) the period beginning on the third Business Day following
either (x) the Primary Liquidity Provider's receipt of the
Notice of Borrowing for such LIBOR Advance or (y) the
withdrawal of funds from the Class G-1 Cash Collateral Account
for the purpose of paying interest on the Class G-1
Certificates as contemplated by Section 2.06(a) hereof and, in
either case, ending on the next Regular Distribution Date; and
(ii) each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the next
Regular Distribution Date;
PROVIDED, HOWEVER, that if (x) the Final Advance shall have been made, or
(y) other outstanding Advances shall have been converted into the Final
Advance, then the Interest Periods shall be successive periods of one
month beginning on the third Business Day following the Primary Liquidity
Provider's receipt of the Notice of Borrowing for such Final Advance (in
the case of clause (x) above) or the Regular Distribution Date following
such conversion (in the case of clause (y) above).
"LIBOR ADVANCE" means an Advance bearing interest at a rate based
upon the LIBOR Rate.
"LIBOR RATE" means, with respect to any Interest Period,
(i) the rate per annum appearing on display page 3750 (British
Bankers Association-LIBOR) of the Dow Jones Markets Service
(or any successor or substitute therefor) at approximately
11:00 A.M. (London time) two Business Days before the first
day of such Interest Period, as the rate for dollar deposits
with a maturity comparable to such Interest Period, or
(ii) if the rate calculated pursuant to clause (i) above is not
available, the average (rounded upwards, if necessary, to the
next 1/16 of 1%) of the rates per annum at which deposits in
dollars are offered for the relevant Interest Period by three
banks of recognized standing selected by the Primary Liquidity
Provider in the London interbank market at approximately 11:00
A.M. (London time) two Business Days before the first day of
such Interest Period in an amount approximately equal to the
principal amount of the LIBOR Advance to which such Interest
Period is to apply and for a period comparable to such
Interest Period.
"LIQUIDITY EVENT OF DEFAULT" means the occurrence of either (a) the
Acceleration of all of the Equipment Notes (PROVIDED that, with respect to
the period prior to the Delivery Period Expiry Date, such Equipment Notes
have an aggregate outstanding principal balance in excess of $140,000,000)
or (b) a Continental Bankruptcy Event.
"LIQUIDITY INDEMNITEE" means (i) the Primary Liquidity Provider,
(ii) the directors, officers, employees and agents of the Primary
Liquidity Provider, and (iii) the successors and permitted assigns of the
persons described in clauses (i) and (ii), inclusive.
"MAXIMUM AVAILABLE COMMITMENT" shall mean, subject to the proviso
contained in the third sentence of Section 2.02(a), at any time of
determination, (a) the Maximum Commitment at such time LESS (b) the
aggregate amount of each Interest Advance outstanding at such time;
PROVIDED that following a Provider Advance or a Final Advance, the Maximum
Available Commitment shall be zero; PROVIDED, FURTHER, that the Maximum
Available Commitment for purposes of calculating the amount of any
Provider Advance or Final Advance shall be (a) the then Required Amount
(calculated for purposes of this proviso on the basis of Capped LIBOR of
15.00% per annum) LESS (b) the aggregate amount of each Interest Advance
outstanding at such time.
"MAXIMUM COMMITMENT" means initially $15,677,610.75 as the same may
be increased or reduced from time to time in accordance with Section
2.04(a).
"NON-EXCLUDED TAX" has the meaning specified in Section 3.03.
"NON-EXTENSION ADVANCE" means an Advance made pursuant to Section
2.02(b).
"NOTICE OF BORROWING" has the meaning specified in Section 2.02(e).
"NOTICE OF REPLACEMENT SUBORDINATION AGENT" has the meaning
specified in Section 3.08.
"PERFORMING NOTE DEFICIENCY" means any time that less than 65% of
the then aggregate outstanding principal amount of all Equipment Notes
(other than any "Series J Equipment Notes" under and as defined in any
Indenture) are Performing Equipment Notes.
"PRIMARY LIQUIDITY PROVIDER" has the meaning assigned to such term
in the recital of parties to this Agreement.
"PROSPECTUS SUPPLEMENT" means the final Prospectus Supplement dated
March 11, 2002 relating to the Class G-1 Certificates and the Class G-2
Certificates, as such Prospectus Supplement may be amended or
supplemented.
"PROVIDER ADVANCE" means a Downgrade Advance or a Non-Extension
Advance.
"REGULATORY CHANGE" has the meaning assigned to such term in Section
3.01.
"REPLENISHMENT AMOUNT" has the meaning assigned to such term in
Section 2.06(b).
"REQUIRED AMOUNT" means, for any day, the sum of the aggregate
amount of interest, calculated at the rate per annum equal to the
applicable Capped Interest Rate for the Class G-1 Certificates, that would
be payable on the Class G-1 Certificates on each of the six successive
quarterly Regular Distribution Dates immediately following such day or, if
such day is a Regular Distribution Date, on such day and the succeeding
five quarterly Regular Distribution Dates, in each case calculated on the
basis of the Pool Balance of the Class G-1 Certificates on such day and
without regard to expected future payments of principal on the Class G-1
Certificates. Notwithstanding the above, in the event of any Policy
Provider Election, for purposes of the definition of the Required Amount
the Pool Balance shall be deemed to be reduced by the amount by which (a)
the then outstanding principal balance of each Series G-1 Equipment Note
in respect of which such Policy Provider Election has been made shall
exceed (b) the amount of any Policy Drawings previously paid by the Policy
Provider in respect of principal on such Series G-1 Equipment Note.
"SUCCESSOR TRUST" means Continental Airlines Pass Through Trust
2002-1G-1-S.
"TAX LETTER" means the letter dated the date hereof between the
Liquidity Provider and Continental pertaining to this Agreement.
"TERMINATION DATE" means the earliest to occur of the following: (i)
the Expiry Date; (ii) the date on which the Borrower delivers to the
Primary Liquidity Provider a certificate, signed by a Responsible Officer
of the Borrower, certifying that all of the Class G-1 Certificates have
been paid in full (or provision has been made for such payment in
accordance with the Intercreditor Agreement and the Trust Agreements) or
are otherwise no longer entitled to the benefits of this Agreement; (iii)
the date on which the Borrower delivers to the Primary Liquidity Provider
a certificate, signed by a Responsible Officer of the Borrower, certifying
that a Replacement Primary Liquidity Facility has been substituted for
this Agreement in full pursuant to Section 3.6(e) of the Intercreditor
Agreement; (iv) the fifth Business Day following the receipt by the
Borrower of a Termination Notice from the Primary Liquidity Provider
pursuant to Section 6.01 hereof; and (v) the date on which no Advance is
or may (including by reason of reinstatement as herein provided) become
available for a Borrowing hereunder.
"TERMINATION NOTICE" means the Notice of Termination substantially
in the form of Annex V to this Agreement.
"TRANSFEREE" has the meaning assigned to such term in Section
7.08(b).
"UNAPPLIED DOWNGRADE ADVANCE" means any Downgrade Advance other than
an Applied Downgrade Advance.
"UNAPPLIED NON-EXTENSION ADVANCE" means any Non-Extension Advance
other than an Applied Non-Extension Advance.
"UNAPPLIED PROVIDER ADVANCE" means any Provider Advance other than
an Applied Provider Advance.
"UNPAID ADVANCE" has the meaning assigned to such term in Section
2.05.
(b) TERMS DEFINED IN THE INTERCREDITOR AGREEMENT. For all purposes
of this Agreement, the following terms shall have the respective meanings
assigned to such terms in the Intercreditor Agreement:
"ACCELERATION", "AIRCRAFT", "CERTIFICATES", "CLASS G-1 ABOVE-CAP LIQUIDITY
PROVIDER", "CLASS G-1 CASH COLLATERAL ACCOUNT", "CLASS G-1
CERTIFICATEHOLDERS", "CLASS G-1 CERTIFICATES", "CLASS G-1 TRUST", "CLASS
G-1 TRUST AGREEMENT", "CLASS G-1 TRUSTEE", "CLASS G-2 CERTIFICATES",
"CLASS H CERTIFICATES", "CLASS I CERTIFICATES", "CLASS J CERTIFICATES",
"CLOSING DATE", "CONTINENTAL", "CONTINENTAL BANKRUPTCY EVENT",
"CONTROLLING PARTY", "CORPORATE TRUST OFFICE", "DELIVERY PERIOD EXPIRY
DATE", "DISTRIBUTION DATE", "DOWNGRADED FACILITY", "EQUIPMENT NOTES", "FEE
LETTER", "FINAL LEGAL DISTRIBUTION DATE", "FINANCING AGREEMENT",
"INDENTURE", "INVESTMENT EARNINGS", "LIQUIDITY FACILITY", "LIQUIDITY
OBLIGATIONS", "LOAN TRUSTEE", "MOODY'S", "NON-EXTENDED FACILITY", "NOTE
PURCHASE AGREEMENT", "OPERATIVE AGREEMENTS", "PARTICIPATION AGREEMENT",
"PERFORMING EQUIPMENT NOTE", "PERSON", "POLICY", "POLICY DRAWINGS",
"POLICY PROVIDER", "POLICY PROVIDER ELECTION", "POOL BALANCE", "PRIMARY
LIQUIDITY FACILITY", "RATING AGENCY", "RATINGS CONFIRMATION", "REGULAR
DISTRIBUTION DATE", "REPLACEMENT LIQUIDITY FACILITY", "RESPONSIBLE
OFFICER", "SCHEDULED PAYMENT", "SPECIAL PAYMENT", "STANDARD & POOR'S",
"STATED INTEREST RATE", "SUBORDINATION AGENT", "TAXES", "THRESHOLD
RATING", "TRANSFER", "TRUST AGREEMENTS", "TRUSTEE", "UNDERWRITERS",
"UNDERWRITING AGREEMENT", and "WRITTEN NOTICE".
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. THE ADVANCES. The Primary Liquidity Provider hereby
irrevocably agrees, on the terms and conditions hereinafter set forth, to make
Advances to the Borrower from time to time on any Business Day during the period
from the Effective Date until 1:00 p.m. (New York City time) on the Expiry Date
(unless the obligations of the Primary Liquidity Provider shall be earlier
terminated in accordance with the terms of Section 2.04(b)) in an aggregate
amount at any time outstanding not to exceed the Maximum Commitment.
Section 2.02. MAKING THE ADVANCES. (a) Interest Advances shall be
made in one or more Borrowings by delivery to the Primary Liquidity Provider of
one or more written and completed Notices of Borrowing in substantially the form
of Annex I attached hereto, signed by a Responsible Officer of the Borrower, in
an amount not exceeding the Maximum Available Commitment at such time and shall
be used solely for the payment when due of interest on the Class G-1
Certificates at the Stated Interest Rate for the applicable Interest Period in
accordance with Section 3.6(a) of the Intercreditor Agreement. Each Interest
Advance made hereunder shall automatically reduce the Maximum Available
Commitment and the amount available to be borrowed hereunder by subsequent
Advances by the amount of such Interest Advance (subject to reinstatement as
provided in the next sentence). Upon repayment to the Primary Liquidity Provider
in full of the amount of any Interest Advance made pursuant to this Section
2.02(a), together with accrued interest thereon (as provided herein), the
Maximum Available Commitment shall be reinstated by the amount of such repaid
Interest Advance, but not to exceed the Maximum Commitment; PROVIDED, HOWEVER,
that the Maximum Available Commitment shall not be so reinstated at any time if
(i) a Liquidity Event of Default shall have occurred and be continuing and (ii)
there is a Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single Borrowing if
this Agreement is not extended in accordance with Section 3.6(d) of the
Intercreditor Agreement (unless a Replacement Primary Liquidity Facility to
replace this Agreement shall have been delivered to the Borrower as contemplated
by said Section 3.6(d) within the time period specified in such Section) by
delivery to the Primary Liquidity Provider of a written and completed Notice of
Borrowing in substantially the form of Annex II attached hereto, signed by a
Responsible Officer of the Borrower, in an amount equal to the Maximum Available
Commitment at such time, and shall be used to fund the Class G-1 Cash Collateral
Account in accordance with said Section 3.6(d) and Section 3.6(f) of the
Intercreditor Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing upon the
occurrence of a Downgrade Event (as provided for in Section 3.6(c) of the
Intercreditor Agreement) unless a Replacement Primary Liquidity Facility to
replace this Agreement shall have been previously delivered to the Borrower in
accordance with said Section 3.6(c), by delivery to the Primary Liquidity
Provider of a written and completed Notice of Borrowing in substantially the
form of Annex III attached hereto, signed by a Responsible Officer of the
Borrower, in an amount equal to the Maximum Available Commitment at such time,
and shall be used to fund the Class G-1 Cash Collateral Account in accordance
with said Section 3.6(c) and Section 3.6(f) of the Intercreditor Agreement. Upon
the occurrence of a Downgrade Event, the Liquidity Provider shall promptly
deliver notice thereof to the Borrower, the Class G-1 Trustee, Continental and
the Policy Provider.
(d) A Final Advance shall be made in a single Borrowing upon
the receipt by the Borrower of a Termination Notice from the Primary Liquidity
Provider pursuant to Section 6.01 hereof by delivery to the Primary Liquidity
Provider of a written and completed Notice of Borrowing in substantially the
form of Annex IV attached hereto, signed by a Responsible Officer of the
Borrower, in an amount equal to the Maximum Available Commitment at such time,
and shall be used to fund the Class G-1 Cash Collateral Account (in accordance
with Sections 3.6(f) and 3.6(i) of the Intercreditor Agreement).
(e) Each Borrowing shall be made on notice in writing (a "NOTICE OF
BORROWING") in substantially the form required by Section 2.02(a), 2.02(b),
2.02(c) or 2.02(d), as the case may be, given by the Borrower to the Primary
Liquidity Provider. If a Notice of Borrowing is delivered by the Borrower in
respect of any Borrowing no later than 1:00 p.m. (New York City time) on a
Business Day, upon satisfaction of the conditions precedent set forth in Section
4.02 with respect to a requested Borrowing, the Primary Liquidity Provider shall
make available to the Borrower, in accordance with its payment instructions, the
amount of such Borrowing in U.S. dollars and immediately available funds, before
4:00 p.m. (New York City time) on such Business Day or on such later Business
Day specified in such Notice of Borrowing. If a Notice of Borrowing is delivered
by the Borrower in respect of any Borrowing on a day that is not a Business Day
or after 1:00 p.m. (New York City time) on a Business Day, upon satisfaction of
the conditions precedent set forth in Section 4.02 with respect to a requested
Borrowing, the Primary Liquidity Provider shall make available to the Borrower,
in accordance with its payment instructions, the amount of such Borrowing in
U.S. dollars and in immediately available funds, before 12:00 Noon (New York
City time) on the first Business Day next following the day of receipt of such
Notice of Borrowing or on such later Business Day specified by the Borrower in
such Notice of Borrowing. Payments of proceeds of a Borrowing shall be made by
wire transfer of immediately available funds to the Borrower in accordance with
such wire transfer instructions as the Borrower shall furnish from time to time
to the Primary Liquidity Provider for such purpose. Each Notice of Borrowing
shall be irrevocable and binding on the Borrower. Each Notice of Borrowing shall
be effective upon delivery of a copy thereof to the Primary Liquidity Provider's
New York Branch at the address specified in Section 7.02 hereof.
(f) Upon the making of any Advance requested pursuant to a Notice of
Borrowing, in accordance with the Borrower's payment instructions, the Primary
Liquidity Provider shall be fully discharged of its obligation hereunder with
respect to such Notice of Borrowing, and the Primary Liquidity Provider shall
not thereafter be obligated to make any further Advances hereunder in respect of
such Notice of Borrowing to the Borrower or to any other Person. If the Primary
Liquidity Provider makes an Advance requested pursuant to a Notice of Borrowing
before 12:00 Noon (New York City time) on the second Business Day after the date
of payment specified in said Section 2.02(e), the Primary Liquidity Provider
shall have fully discharged its obligations hereunder with respect to such
Advance and an event of default shall not have occurred hereunder. Following the
making of any Advance pursuant to Section 2.02(b), (c) or (d) hereof to fund the
Class G-1 Cash Collateral Account, the Primary Liquidity Provider shall have no
interest in or rights to the Class G-1 Cash Collateral Account, the funds
constituting such Advance or any other amounts from time to time on deposit in
the Class G-1 Cash Collateral Account; PROVIDED that the foregoing shall not
affect or impair the obligations of the Subordination Agent to make the
distributions contemplated by Section 3.6(e) or (f) of the Intercreditor
Agreement, and PROVIDED FURTHER, that the foregoing shall not affect or impair
the rights of the Primary Liquidity Provider to provide written instructions
with respect to the investment and reinvestment of amounts in the Cash
Collateral Accounts to the extent provided in Section 2.2(b) of the
Intercreditor Agreement. By paying to the Borrower proceeds of Advances
requested by the Borrower in accordance with the provisions of this Agreement,
the Primary Liquidity Provider makes no representation as to, and assumes no
responsibility for, the correctness or sufficiency for any purpose of the amount
of the Advances so made and requested.
Section 2.03. FEES. The Borrower agrees to pay to the Primary
Liquidity Provider the fees set forth in the Fee Letter applicable to this
Agreement.
Section 2.04. ADJUSTMENTS OR TERMINATION OF THE MAXIMUM COMMITMENT.
(a) AUTOMATIC ADJUSTMENT. Promptly following each date on which the
Required Amount is (1) reduced as a result of a reduction in the Pool Balance of
the Class G-1 Certificates (including by reason of a Policy Provider Election
with respect to one or more Series G-1 Equipment Notes) or otherwise, or (2)
increased as a result of an increase in the Capped Interest Rate for the Class
G-1 Certificates, the Maximum Commitment shall automatically be reduced or
increased, as the case may be, to an amount equal to such reduced or increased
Required Amount (as calculated by the Borrower); PROVIDED that on the first
Regular Distribution Date, the Maximum Commitment shall automatically be reduced
to the then Required Amount. The Borrower shall give notice of any such
automatic reduction or increase of the Maximum Commitment to the Primary
Liquidity Provider within two Business Days thereof. The failure by the Borrower
to furnish any such notice shall not affect such automatic reduction or increase
of the Maximum Commitment.
(b) TERMINATION. Upon the making of any Provider Advance or Final
Advance hereunder or the occurrence of the Termination Date, the obligation of
the Primary Liquidity Provider to make further Advances hereunder shall
automatically and irrevocably terminate, and the Borrower shall not be entitled
to request any further Borrowing hereunder.
Section 2.05. REPAYMENTS OF INTEREST ADVANCES OR THE FINAL ADVANCE.
Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees,
without notice of an Advance or demand for repayment from the Primary Liquidity
Provider (which notice and demand are hereby waived by the Borrower), to pay, or
to cause to be paid, to the Primary Liquidity Provider on each date on which the
Primary Liquidity Provider shall make an Interest Advance or the Final Advance,
an amount equal to (a) the amount of such Advance (any such Advance, until
repaid, is referred to herein as an "UNPAID ADVANCE"), plus (b) interest on the
amount of each such Unpaid Advance as provided in Section 3.07 hereof; PROVIDED
that if (i) the Primary Liquidity Provider shall make a Provider Advance at any
time after making one or more Interest Advances which shall not have been repaid
in accordance with this Section 2.05 or (ii) this Liquidity Facility shall
become a Downgraded Facility or Non-Extended Facility at any time when
unreimbursed Interest Advances have reduced the Maximum Available Commitment to
zero, then such Interest Advances shall cease to constitute Unpaid Advances and
shall be deemed to have been changed into an Applied Downgrade Advance or an
Applied Non-Extension Advance, as the case may be, for all purposes of this
Agreement (including, without limitation, for the purpose of determining when
such Interest Advance is required to be repaid to the Primary Liquidity Provider
in accordance with Section 2.06 and for the purposes of Section 2.06(b)). The
Borrower and the Primary Liquidity Provider agree that the repayment in full of
each Interest Advance and Final Advance on the date such Advance is made is
intended to be a contemporaneous exchange for new value given to the Borrower by
the Primary Liquidity Provider.
Section 2.06. REPAYMENTS OF PROVIDER ADVANCES. (a) Amounts advanced
hereunder in respect of a Provider Advance shall be deposited in the Class G-1
Cash Collateral Account, invested and withdrawn from the Class G-1 Cash
Collateral Account as set forth in Sections 3.6(c), (d) and (f) of the
Intercreditor Agreement. The Borrower agrees to pay to the Primary Liquidity
Provider, on each Regular Distribution Date, commencing on the first Regular
Distribution Date after the making of a Provider Advance, interest on the
principal amount of any such Provider Advance as provided in Section 3.07;
PROVIDED, HOWEVER, that amounts in respect of a Provider Advance withdrawn from
the Class G-1 Cash Collateral Account for the purpose of paying interest on the
Class G-1 Certificates in accordance with Section 3.6(f) of the Intercreditor
Agreement (the amount of any such withdrawal being (y) in the case of a
Downgrade Advance, an "APPLIED DOWNGRADE ADVANCE" and (z) in the case of a
Non-Extension Advance, an "APPLIED NON-EXTENSION ADVANCE" and, together with an
Applied Downgrade Advance, an "APPLIED PROVIDER ADVANCE") shall thereafter
(subject to Section 2.06(b)) be treated as an Interest Advance under this
Agreement for purposes of determining the Applicable Liquidity Rate for interest
payable thereon; PROVIDED FURTHER, HOWEVER, that if, following the making of a
Provider Advance, the Primary Liquidity Provider delivers a Termination Notice
to the Borrower pursuant to Section 6.01 hereof, such Provider Advance shall
thereafter be treated as a Final Advance under this Agreement for purposes of
determining the Applicable Liquidity Rate for interest payable thereon and the
obligation for repayment thereof. Subject to Sections 2.07 and 2.09 hereof,
immediately upon the withdrawal of any amounts from the Class G-1 Cash
Collateral Account on account of a reduction in the Required Amount, the
Borrower shall repay to the Primary Liquidity Provider a portion of the Provider
Advances in a principal amount equal to such reduction, plus interest on the
principal amount prepaid as provided in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any portion
thereof) is outstanding, upon the deposit in the Class G-1 Cash Collateral
Account of any amount pursuant to clause "THIRD" of Section 2.4(b) of the
Intercreditor Agreement, clause "THIRD" of Section 3.2 of the Intercreditor
Agreement or clause "FOURTH" of Section 3.3 of the Intercreditor Agreement (any
such amount being a "REPLENISHMENT AMOUNT") for the purpose of replenishing or
increasing the balance thereof up to the Required Amount at such time, (i) the
aggregate outstanding principal amount of all Applied Provider Advances (and of
Provider Advances treated as an Interest Advance for purposes of determining the
Applicable Liquidity Rate for interest payable thereon) shall be automatically
reduced by the amount of such Replenishment Amount and (ii) the aggregate
outstanding principal amount of all Unapplied Provider Advances shall be
automatically increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Primary Liquidity Facility
in replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class G-1 Cash
Collateral Account after giving effect to any Applied Provider Advance on the
date of such replacement shall be reimbursed to the Primary Liquidity Provider,
but only to the extent such amounts are necessary to repay in full to the
Primary Liquidity Provider all amounts owing to it hereunder.
Section 2.07. PAYMENTS TO THE PRIMARY LIQUIDITY PROVIDER UNDER THE
INTERCREDITOR AGREEMENT. In order to provide for payment or repayment to the
Primary Liquidity Provider of any amounts hereunder, the Intercreditor Agreement
provides that amounts available and referred to in Articles II and III of the
Intercreditor Agreement, to the extent payable to the Primary Liquidity Provider
pursuant to the terms of the Intercreditor Agreement (including, without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Primary Liquidity Provider in accordance with the terms thereof. Amounts so paid
to the Primary Liquidity Provider shall be applied by the Primary Liquidity
Provider to Liquidity Obligations then due and payable in accordance with the
Intercreditor Agreement or, if not provided for in the Intercreditor Agreement,
then in such manner as the Primary Liquidity Provider shall deem appropriate.
Section 2.08. BOOK ENTRIES. The Primary Liquidity Provider shall
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower resulting from Advances made from time to time
and the amounts of principal and interest payable hereunder and paid from time
to time in respect thereof; PROVIDED, HOWEVER, that the failure by the Primary
Liquidity Provider to maintain such account or accounts shall not affect the
obligations of the Borrower in respect of Advances.
Section 2.09. PAYMENTS FROM AVAILABLE FUNDS ONLY. All payments to be
made by the Borrower under this Agreement shall be made only from the amounts
that constitute Scheduled Payments, Special Payments or payments under Section
8.1 of the Participation Agreements with respect to Aircraft and payments under
Section 6 of the Note Purchase Agreement and only to the extent that the
Borrower shall have sufficient income or proceeds therefrom to enable the
Borrower to make payments in accordance with the terms hereof after giving
effect to the priority of payments provisions set forth in the Intercreditor
Agreement. The Primary Liquidity Provider agrees that it will look solely to
such amounts to the extent available for distribution to it as provided in the
Intercreditor Agreement and this Agreement and that the Borrower, in its
individual capacity, is not personally liable to it for any amounts payable or
liability under this Agreement except as expressly provided in this Agreement,
the Intercreditor Agreement or any Participation Agreement. Amounts on deposit
in the Class G-1 Cash Collateral Account shall be available to the Borrower to
make payments under this Agreement only to the extent and for the purposes
expressly contemplated in Section 3.6(f) of the Intercreditor Agreement.
Section 2.10. EXTENSION OF THE EXPIRY DATE; NON-EXTENSION ADVANCE.
No earlier than the 60th day and no later than the 40th day prior to the then
effective Expiry Date (unless such Expiry Date is on or after the date that is
15 days after the Final Legal Distribution Date for the Class G-1 Certificates),
the Borrower shall request that the Primary Liquidity Provider extend the Expiry
Date to the earlier of (i) the date that is 15 days after the Final Legal
Distribution Date for the Class G-1 Certificates and (ii) the date that is the
day immediately preceding the 364th day occurring after the last day of the
Consent Period (as hereinafter defined). Whether or not the Borrower has made
such request, the Primary Liquidity Provider shall advise the Borrower and the
Policy Provider, no earlier than the 40th day (or, if earlier, the date of the
Primary Liquidity Provider's receipt of such request, if any, from the Borrower)
and no later than the 25th day prior to the then effective Expiry Date (such
period, the "CONSENT PERIOD"), whether, in its sole discretion, it agrees to so
extend the Expiry Date. If the Primary Liquidity Provider advises the Borrower
and the Policy Provider on or before the date on which the Consent Period ends
that such Expiry Date shall not be so extended, or fails to irrevocably and
unconditionally advise the Borrower on or before the date on which the Consent
Period ends that such Expiry Date shall be so extended (and, in each case, if
the Primary Liquidity Provider shall not have been replaced in accordance with
Section 3.6(e) of the Intercreditor Agreement), the Borrower shall be entitled
on and after the date on which the Consent Period ends (but prior to the then
effective Expiry Date) to request a Non-Extension Advance in accordance with
Section 2.02(b) hereof and Section 3.6(d) of the Intercreditor Agreement.
Section 2.11 RIGHT TO FURTHER EXTEND EXPIRY DATE. Subject to the
proviso in the immediately succeeding sentence, the Primary Liquidity Provider
shall have the right at any time and without the consent of the Borrower to
extend the then effective Expiry Date to the date that is 15 days after the
Final Legal Distribution Date for the Class G-1 Certificates by giving not less
than five nor more than ten days' prior written notice of such extension to the
Borrower, the Class G-1 Trustee and Continental (which notice shall specify the
effective date of such extension (the "EXTENSION EFFECTIVE DATE")). On the
Extension Effective Date, the then effective Expiry Date shall be so extended
without any further act; PROVIDED, HOWEVER, that if prior to the Extension
Effective Date a Downgrade Event shall have occurred, the then effective Expiry
Date shall not be so extended.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01. INCREASED COSTS. The Borrower shall pay to the Primary
Liquidity Provider from time to time such amounts as may be necessary to
compensate the Primary Liquidity Provider for any increased costs incurred by
the Primary Liquidity Provider which are attributable to its making or
maintaining any LIBOR Advances hereunder or its obligation to make any such
Advances hereunder, or any reduction in any amount receivable by the Primary
Liquidity Provider under this Agreement or the Intercreditor Agreement in
respect of any such Advances or such obligation (such increases in costs and
reductions in amounts receivable being herein called "ADDITIONAL COSTS"),
resulting from any change after the date of this Agreement in U.S. federal,
state, municipal, or foreign laws or regulations (including Regulation D of the
Board of Governors of the Federal Reserve System), or the adoption or making
after the date of this Agreement of any interpretations, directives, or
requirements applying to a class of banks including the Primary Liquidity
Provider under any U.S. federal, state, municipal, or any foreign laws or
regulations (whether or not having the force of law) by any court, central bank
or monetary authority charged with the interpretation or administration thereof
(a "REGULATORY CHANGE"), which: (1) changes the basis of taxation of any amounts
payable to the Primary Liquidity Provider under this Agreement in respect of any
such Advances or such obligation (other than Excluded Taxes); or (2) imposes or
modifies any reserve, special deposit, compulsory loan or similar requirements
relating to any extensions of credit or other assets of, or any deposits with
other liabilities of, the Primary Liquidity Provider (including any such
Advances or such obligation or any deposits referred to in the definition of
LIBOR Rate or related definitions). The Primary Liquidity Provider agrees to use
reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making such
change would avoid the need for, or reduce the amount of, any amount payable
under this Section that may thereafter accrue and would not, in the reasonable
judgment of the Primary Liquidity Provider, be otherwise disadvantageous to the
Primary Liquidity Provider.
The Primary Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Primary
Liquidity Provider to compensation pursuant to this Section 3.01 as promptly as
practicable after it obtains knowledge thereof and determines to request such
compensation, which notice shall describe in reasonable detail the calculation
of the amounts owed under this Section. Determinations by the Primary Liquidity
Provider for purposes of this Section 3.01 of the effect of any Regulatory
Change on its costs of making or maintaining Advances or on amounts receivable
by it in respect of Advances, and of the additional amounts required to
compensate the Primary Liquidity Provider in respect of any Additional Costs,
shall be prima facie evidence of the amount owed under this Section.
Notwithstanding the preceding two paragraphs, the Primary Liquidity
Provider and the Subordination Agent agree that any permitted assignee or
participant of the initial Primary Liquidity Provider which is not a bank shall
not be entitled to the benefits of the preceding two paragraphs (but without
limiting the provisions of Section 7.08 hereof).
Section 3.02. CAPITAL ADEQUACY. If (1) the adoption, after the date
hereof, of any applicable governmental law, rule or regulation regarding capital
adequacy, (2) any change, after the date hereof, in the interpretation or
administration of any such law, rule or regulation by any central bank or other
governmental authority charged with the interpretation or administration thereof
or (3) compliance by the Primary Liquidity Provider or any corporation
controlling the Primary Liquidity Provider with any applicable guideline or
request of general applicability, issued after the date hereof, by any central
bank or other governmental authority (whether or not having the force of law)
that constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital required to be maintained by
the Primary Liquidity Provider or any corporation controlling the Primary
Liquidity Provider, and such increase is based upon the Primary Liquidity
Provider's obligations hereunder and other similar obligations, the Borrower
shall, subject to the provisions of the next paragraph, pay to the Primary
Liquidity Provider from time to time such additional amount or amounts as are
necessary to compensate the Primary Liquidity Provider for such portion of such
increase as shall be reasonably allocable to the Primary Liquidity Provider's
obligations to the Borrower hereunder. The Primary Liquidity Provider agrees to
use reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making such
change would avoid the need for, or reduce the amount of, any amount payable
under this Section that may thereafter accrue and would not, in the reasonable
judgment of the Primary Liquidity Provider, be otherwise materially
disadvantageous to the Primary Liquidity Provider.
From and after the Extension Effective Date and prior to the
occurrence of a Helaba Downgrade, the Primary Liquidity Provider will be
entitled to compensation pursuant to this Section 3.02 only to the extent that
the Primary Liquidity Provider would have been so entitled if the Extension
Effective Date had not occurred. From and after the Extension Effective Date and
after the occurrence of a Helaba Downgrade, the Primary Liquidity Provider will
be entitled to compensation pursuant to this Section 3.02 only to the extent
that the Primary Liquidity Provider would have been so entitled had the Primary
Liquidity Provider made a Downgrade Advance upon the occurrence of such Helaba
Downgrade.
The Primary Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Primary
Liquidity Provider to compensation pursuant to this Section 3.02 as promptly as
practicable after it obtains knowledge thereof and determines to request such
compensation, which notice shall describe in reasonable detail the calculation
of the amounts owed under this Section. Determinations by the Primary Liquidity
Provider for purposes of this Section 3.02 of the effect of any increase in the
amount of capital required to be maintained by the Primary Liquidity Provider
and of the amount allocable to the Primary Liquidity Provider's obligations to
the Borrower hereunder shall be prima facie evidence of the amounts owed under
this Section.
Notwithstanding the preceding three paragraphs, the Primary
Liquidity Provider and the Subordination Agent agree that any permitted assignee
or participant of the initial Primary Liquidity Provider which is not a bank
shall not be entitled to the benefits of the preceding two paragraphs (but
without limiting the provisions of Section 7.08 hereof).
Section 3.03. PAYMENTS FREE OF DEDUCTIONS. (a) All payments made by
the Borrower under this Agreement shall be made free and clear of, and without
reduction for or on account of, any present or future stamp or other taxes,
levies, imposts, duties, charges, fees, deductions, withholdings, restrictions
or conditions of any nature whatsoever now or hereafter imposed, levied,
collected, withheld or assessed, excluding Excluded Taxes (such non-excluded
taxes being referred to herein, collectively, as "NON-EXCLUDED TAXES" and each,
individually, as a "NON-EXCLUDED TAX"). If any Non-Excluded Taxes are required
to be withheld from any amounts payable to the Primary Liquidity Provider under
this Agreement, (i) the Borrower shall within the time prescribed therefor by
applicable law pay to the appropriate governmental or taxing authority the full
amount of any such Non-Excluded Taxes (and any additional Non-Excluded Taxes in
respect of the additional amounts payable under clause (ii) hereof) and make
such reports or returns in connection therewith at the time or times and in the
manner prescribed by applicable law, and (ii) the amounts so payable to the
Primary Liquidity Provider shall be increased to the extent necessary to yield
to the Primary Liquidity Provider (after payment of all Non-Excluded Taxes)
interest or any other such amounts payable under this Agreement at the rates or
in the amounts specified in this Agreement. The Primary Liquidity Provider
agrees to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to change the jurisdiction of its Facility Office
if making such change would avoid the need for, or reduce the amount of, any
such additional amounts that may thereafter accrue and would not, in the
reasonable judgment of the Primary Liquidity Provider, be otherwise
disadvantageous to the Primary Liquidity Provider. From time to time upon the
reasonable request of the Borrower, the Primary Liquidity Provider agrees to
provide to the Borrower two original Internal Revenue Service Form W-8BEN or
W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that the Primary Liquidity Provider is
exempt from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement. Within 30 days after the date of each
payment hereunder, the Borrower shall furnish to the Primary Liquidity Provider
the original or a certified copy of (or other documentary evidence of) the
payment of the Non-Excluded Taxes applicable to such payment.
(b) All payments (including, without limitation, Advances) made by
the Primary Liquidity Provider under this Agreement shall be made free and clear
of, and without reduction for or on account of, any Taxes. If any Taxes are
required to be withheld or deducted from any amounts payable to the Borrower
under this Agreement, the Primary Liquidity Provider shall (i) within the time
prescribed therefor by applicable law pay to the appropriate governmental or
taxing authority the full amount of any such Taxes (and any additional Taxes in
respect of the additional amounts payable under clause (ii) hereof) and make
such reports or returns in connection therewith at the time or times and in the
manner prescribed by applicable law, and (ii) pay to the Borrower an additional
amount which (after deduction of all such Taxes) will be sufficient to yield to
the Borrower the full amount which would have been received by it had no such
withholding or deduction been made. Within 30 days after the date of each
payment hereunder, the Primary Liquidity Provider shall furnish to the Borrower
the original or a certified copy of (or other documentary evidence of) the
payment of the Taxes applicable to such payment.
(c) If any exemption from, or reduction in the rate of, any Taxes is
reasonably available to the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) tax, the Borrower
shall deliver to the Primary Liquidity Provider such form or forms and such
other evidence of the eligibility of the Borrower for such exemption or
reduction as the Primary Liquidity Provider may reasonably identify to the
Borrower as being required as a condition to exemption from, or reduction in the
rate of, any Taxes.
Section 3.04. PAYMENTS. The Borrower shall make or cause to be made
each payment to the Primary Liquidity Provider under this Agreement so as to
cause the same to be received by the Primary Liquidity Provider not later than
1:00 P.M. (New York City time) on the day when due. The Borrower shall make all
such payments in lawful money of the United States of America, to the Primary
Liquidity Provider in immediately available funds, by wire transfer to Citibank
N.A., New York/ABA 021000089 in favor of account number 10920118, reference
Continental Airlines Trust 2002-1G-1 #4244125, MT215000, attn. M. Kirr.
Section 3.05. COMPUTATIONS. All computations of interest based on
the Base Rate shall be made on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the LIBOR Rate shall be
made on the basis of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest is payable.
Section 3.06. PAYMENT ON NON-BUSINESS DAYS. Whenever any payment to
be made hereunder shall be stated to be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made, shall be deemed to have been
made when due). If any payment in respect of interest on an Advance is so
deferred to the next succeeding Business Day, such deferral shall not delay the
commencement of the next Interest Period for such Advance (if such Advance is a
LIBOR Advance) or reduce the number of days for which interest will be payable
on such Advance on the next interest payment date for such Advance.
Section 3.07. INTEREST. (a) Subject to Section 2.09, the Borrower
shall pay, or shall cause to be paid, without duplication, interest on (i) the
unpaid principal amount of each Advance from and including the date of such
Advance (or, in the case of an Applied Provider Advance, from and including the
date on which the amount thereof was withdrawn from the Class G-1 Cash
Collateral Account to pay interest on the Class G-1 Certificates) to but
excluding the date such principal amount shall be paid in full (or, in the case
of an Applied Provider Advance, the date on which the Class G-1 Cash Collateral
Account is fully replenished in respect of such Advance) and (ii) any other
amount due hereunder (whether fees, commissions, expenses or other amounts or,
to the extent permitted by law, installments of interest on Advances or any such
other amount) which is not paid when due (whether at stated maturity, by
acceleration or otherwise) from and including the due date thereof to but
excluding the date such amount is paid in full, in each such case, at a
fluctuating interest rate per annum for each day equal to the Applicable
Liquidity Rate (as defined below) for such Advance or such other amount as in
effect for such day, but in no event at a rate per annum greater than the
maximum rate permitted by applicable law; PROVIDED, HOWEVER, that, if at any
time the otherwise applicable interest rate as set forth in this Section 3.07
shall exceed the maximum rate permitted by applicable law, then any subsequent
reduction in such interest rate will not reduce the rate of interest payable
pursuant to this Section 3.07 below the maximum rate permitted by applicable law
until the total amount of interest accrued equals the amount of interest that
would have accrued if such otherwise applicable interest rate as set forth in
this Section 3.07 had at all times been in effect.
(b) Except as provided in clause (e) below, each Advance (including,
without limitation, each outstanding Unapplied Downgrade Advance) will be either
a Base Rate Advance or a LIBOR Advance as provided in this Section. Each such
Advance will be a Base Rate Advance for the period from the date of its
borrowing to (but excluding) the third Business Day following the Primary
Liquidity Provider's receipt of the Notice of Borrowing for such Advance.
Thereafter, such Advance shall be a LIBOR Advance; provided that the Borrower
(at the direction of the Controlling Party, so long as the Primary Liquidity
Provider is not the Controlling Party) may (x) convert the Final Advance into a
Base Rate Advance on the last day of an Interest Period for such Advance by
giving the Primary Liquidity Provider no less than four Business Days' prior
written notice of such election or (y) elect to maintain the Final Advance as a
Base Rate Advance by not requesting a conversion of the Final Advance to a LIBOR
Advance under Clause (5) of the applicable Notice of Borrowing (or, if such
Final Advance is deemed to have been made, without delivery of a Notice of
Borrowing pursuant to Section 2.06, by requesting, prior to 11:00 A.M. (New York
City time) on the first Business Day immediately following the Borrower's
receipt of the applicable Termination Notice, that such Final Advance not be
converted from a Base Rate Advance to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each Interest
Period at a rate per annum equal to the LIBOR Rate for such Interest Period plus
the Applicable Margin for such LIBOR Advance, payable in arrears on the last day
of such Interest Period and, in the event of the payment of principal of such
LIBOR Advance on a day other than such last day, on the date of such payment (to
the extent of interest accrued on the amount of principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin for such Base Rate Advance,
payable in arrears on each Regular Distribution Date and, in the event of the
payment of principal of such Base Rate Advance on a day other than a Regular
Distribution Date, on the date of such payment (to the extent of interest
accrued on the amount of principal repaid).
(e) Each outstanding Unapplied Non-Extension Advance shall bear
interest in an amount equal to the Investment Earnings on amounts on deposit in
the Class G-1 Cash Collateral Account plus the Applicable Margin for such
Unapplied Non-Extension Advance on the amount of such Unapplied Non-Extension
Advance from time to time, payable in arrears on each Regular Distribution Date.
(f) Each amount not paid when due hereunder (whether fees,
commissions, expenses or other amounts or, to the extent permitted by applicable
law, installments of interest on Advances but excluding Advances) shall bear
interest at a rate per annum equal to the Base Rate plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective immediately.
The rates of interest specified in this Section 3.07 with respect to any Advance
or other amount shall be referred to as the "APPLICABLE LIQUIDITY RATE".
Section 3.08. REPLACEMENT OF BORROWER. From time to time and subject
to the successor Borrower's meeting the eligibility requirements set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination
Agent, upon the effective date and time specified in a written and completed
Notice of Replacement Subordination Agent in substantially the form of Annex VI
attached hereto (a "NOTICE OF REPLACEMENT SUBORDINATION AGENT") delivered to the
Primary Liquidity Provider by the then Borrower, the successor Borrower
designated therein shall be substituted for as the Borrower for all purposes
hereunder.
Section 3.09. FUNDING LOSS INDEMNIFICATION. The Borrower shall pay
to the Primary Liquidity Provider, upon the request of the Primary Liquidity
Provider, such amount or amounts as shall be sufficient (in the reasonable
opinion of the Primary Liquidity Provider) to compensate it for any loss, cost,
or expense incurred by reason of the liquidation or redeployment of deposits or
other funds acquired by the Primary Liquidity Provider to fund or maintain any
LIBOR Advance (but excluding loss of anticipated profits) incurred as a result
of:
(1) Any repayment of a LIBOR Advance on a date other than the last
day of the Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on the
date for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. ILLEGALITY. Notwithstanding any other provision in
this Agreement, if any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Primary Liquidity Provider (or its
Facility Office) with any request or directive (whether or not having the force
of law) of any such authority, central bank or comparable agency shall make it
unlawful or impossible for the Primary Liquidity Provider (or its Facility
Office) to maintain or fund its LIBOR Advances, then upon notice to the Borrower
by the Primary Liquidity Provider, the outstanding principal amount of the LIBOR
Advances shall be converted to Base Rate Advances (a) immediately upon demand of
the Primary Liquidity Provider, if such change or compliance with such request,
in the judgment of the Primary Liquidity Provider, requires immediate repayment;
or (b) at the expiration of the last Interest Period to expire before the
effective date of any such change or request. The Primary Liquidity Provider
agrees to use reasonable efforts (consistent with applicable legal and
regulatory restrictions) to change the jurisdiction of its Facility Office if
making such change would avoid or cure the aforesaid illegality and would not,
in the reasonable judgment of the Primary Liquidity Provider, be otherwise
disadvantageous to the Primary Liquidity Provider.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION 2.01.
Section 2.01 of this Agreement shall become effective on and as of the first
date (the "EFFECTIVE DATE") on which the following conditions precedent have
been satisfied or waived:
(a) The Primary Liquidity Provider shall have received each of the
following, and in the case of each document delivered pursuant to
paragraphs (i), (ii) and (iii), each in form and substance satisfactory to
the Primary Liquidity Provider:
(i) This Agreement duly executed on behalf of the Borrower,
the Fee Letter applicable to this Agreement duly executed on behalf
of the Borrower and the Tax Letter duly executed on behalf of
Continental;
(ii) The Intercreditor Agreement duly executed on behalf of
each of the parties thereto (other than the Primary Liquidity
Provider);
(iii) Fully executed copies of each of the Operative
Agreements executed and delivered on the Closing Date (other than
this Agreement, the Fee Letter applicable to this Agreement, the Tax
Letter and the Intercreditor Agreement);
(iv) A copy of the Prospectus Supplement and specimen copies
of the Class G-1 Certificates;
(v) An executed copy of each document, instrument, certificate
and opinion delivered on the Closing Date pursuant to the Class G-1
Trust Agreement, the Intercreditor Agreement and the other Operative
Agreements (in the case of each such opinion, other than the opinion
of counsel for the Underwriters, either addressed to the Primary
Liquidity Provider or accompanied by a letter from the counsel
rendering such opinion to the effect that the Primary Liquidity
Provider is entitled to rely on such opinion as of its date as if it
were addressed to the Primary Liquidity Provider);
(vi) Evidence that there shall have been made and shall be in
full force and effect, all filings, recordings and/or registrations,
and there shall have been given or taken any notice or other similar
action as may be reasonably necessary or, to the extent reasonably
requested by the Primary Liquidity Provider, reasonably advisable,
in order to establish, perfect, protect and preserve the right,
title and interest, remedies, powers, privileges, liens and security
interests of, or for the benefit of, the Trustees, the Borrower and
the Primary Liquidity Provider created by the Operative Agreements
executed and delivered on the Closing Date;
(vii) An agreement from Continental, pursuant to which (i)
Continental agrees to provide to the Primary Liquidity Provider (A)
within 90 days after the end of each of the first three fiscal
quarters in each fiscal year of Continental, a consolidated balance
sheet of Continental as of the end of such quarter and related
statements of income and cash flows for the period commencing at the
end of the previous fiscal year and ending with the end of such
quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding period in the preceding
fiscal year, prepared in accordance with GAAP; PROVIDED, that so
long as Continental is subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended, a copy of Continental's
report on Form 10-Q for such fiscal quarter (excluding exhibits) or
a written notice executed by an authorized officer of Continental
that such report has been filed with the Securities and Exchange
Commission, providing a website address at which such report may be
accessed and confirming that the report accessible at such website
address conforms to the original report filed with the Securities
and Exchange Commission will satisfy this subclause (A), and (B)
within 120 days after the end of each fiscal year of Continental, a
consolidated balance sheet of Continental as of the end of such
fiscal year and related statements of income and cash flows of
Continental for such fiscal year, in comparative form with the
preceding fiscal year, prepared in accordance with GAAP, together
with a report of Continental's independent certified public
accountants with respect to their audit of such financial
statements; PROVIDED, that so long as Continental is subject to the
reporting requirements of the Securities Exchange Act of 1934, as
amended, a copy of Continental's report on Form 10-K for such fiscal
year (excluding exhibits) or a written notice executed by an
authorized officer of Continental that such report has been filed
with the Securities and Exchange Commission, providing a website
address at which such report may be accessed and confirming that the
report accessible at such website address conforms to the original
report filed with the Securities and Exchange Commission will
satisfy this subclause (B), and (ii) Continental agrees to allow the
Primary Liquidity Provider to inspect Continental's books and
records regarding such transactions, and to discuss such
transactions with officers and employees of Continental; and
(viii) Such other documents, instruments, opinions and
approvals pertaining to the transactions contemplated hereby or by
the other Operative Agreements as the Primary Liquidity Provider
shall have reasonably requested.
(b) The following statement shall be true on and as of the Effective
Date: no event has occurred and is continuing, or would result from the
entering into of this Agreement or the making of any Advance, which
constitutes a Liquidity Event of Default.
(c) The Primary Liquidity Provider shall have received payment in
full of all fees and other sums required to be paid to or for the account
of the Primary Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the Certificates
under the Trust Agreements shall have been satisfied or waived, and all
conditions precedent to the purchase of the Class G-1 Certificates and
Class G-2 Certificates by the Underwriters under the Underwriting
Agreement shall have been satisfied or waived.
(e) The Borrower shall have received a certificate, dated the date
hereof, signed by a duly authorized representative of the Primary
Liquidity Provider, certifying that all conditions precedent to the
effectiveness of Section 2.01 have been satisfied or waived
Section 4.02. CONDITIONS PRECEDENT TO BORROWING. The obligation of
the Primary Liquidity Provider to make an Advance on the occasion of each
Borrowing shall be subject to the conditions precedent that the Effective Date
shall have occurred and, on or prior to the date of such Borrowing, the Borrower
shall have delivered a Notice of Borrowing which conforms to the terms and
conditions of this Agreement and has been completed as may be required by the
relevant form of the Notice of Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. AFFIRMATIVE COVENANTS OF THE BORROWER. So long as any
Advance shall remain unpaid or the Primary Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to pay
any amount to the Primary Liquidity Provider hereunder, the Borrower will,
unless the Primary Liquidity Provider shall otherwise consent in writing:
(a) PERFORMANCE OF THIS AND OTHER AGREEMENTS. Punctually pay or
cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material
respects the conditions, covenants and requirements applicable to it
contained in this Agreement and the other Operative Agreements.
(b) REPORTING REQUIREMENTS. Furnish to the Primary Liquidity
Provider with reasonable promptness, such other information and data with
respect to the transactions contemplated by the Operative Agreements as
from time to time may be reasonably requested by the Primary Liquidity
Provider; and permit the Primary Liquidity Provider, upon reasonable
notice, to inspect the Borrower's books and records with respect to such
transactions and to meet with officers and employees of the Borrower to
discuss such transactions.
(c) CERTAIN OPERATIVE AGREEMENTS. Furnish to the Primary Liquidity
Provider with reasonable promptness, such Operative Agreements entered
into after the date hereof as from time to time may be reasonably
requested by the Primary Liquidity Provider.
Section 5.02. NEGATIVE COVENANTS OF THE BORROWER. So long as any
Advance shall remain unpaid or the Primary Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to pay
any amount to the Primary Liquidity Provider hereunder, the Borrower will not
appoint or permit or suffer to be appointed any successor Borrower without the
prior written consent of the Primary Liquidity Provider, which consent shall not
be unreasonably withheld or delayed.
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. LIQUIDITY EVENTS OF DEFAULT. If (a) any Liquidity
Event of Default has occurred and is continuing and (b) there is a Performing
Note Deficiency, the Primary Liquidity Provider may, in its discretion, deliver
to the Borrower a Termination Notice, the effect of which shall be to cause (i)
the obligation of the Primary Liquidity Provider to make Advances hereunder to
expire on the fifth Business Day after the date on which such Termination Notice
is received by the Borrower, (ii) the Borrower to promptly request, and the
Primary Liquidity Provider to promptly make, a Final Advance in accordance with
Section 2.02(d) hereof and Section 3.6(i) of the Intercreditor Agreement, (iii)
all other outstanding Advances to be automatically converted into Final Advances
for purposes of determining the Applicable Liquidity Rate for interest payable
thereon, and (iv) subject to Sections 2.07 and 2.09 hereof, all Advances
(including, without limitation, any Provider Advance and Applied Provider
Advance), any accrued interest thereon and any other amounts outstanding
hereunder to become immediately due and payable to the Primary Liquidity
Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Primary Liquidity Provider, and, in the case of an amendment
or of a waiver by the Borrower, the Borrower, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
Section 7.02. NOTICES, ETC. Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):
Borrower: WILMINGTON TRUST COMPANY
Rodney Square North
1100 North Market Square
Wilmington, DE 19890-1605
Attention: Corporate Capital Market Services
Telephone: (302) 636-6296
Telecopy: (302) 636-4140
Primary Liquidity LANDESBANK HESSEN-THURINGEN
Provider: GIROZENTRALE
Main Tower
Neue Mainzer Str. 52 - 58
60311 Frankfurt am Main
Germany
Attention: Asset Finance
Telephone: 49-69-9132-4882
Telecopy: 49-69-9132-4392
with a copy of any Notice of Borrowing to:
LANDESBANK HESSEN-THURINGEN
420 Fifth Avenue, 24th Floor
New York, NY 10018
Attention: Project Finance/Michael Novack
Telephone: (212) 703-5224
Telecopy: (212) 703-5256
or, as to each of the foregoing, at such other address as shall be designated by
such Person in a written notice to the others. All such notices and
communications shall be effective (i) if given by telecopier, when transmitted
to the telecopier number specified above, (ii) if given by mail, when deposited
in the mails addressed as specified above, and (iii) if given by other means,
when delivered at the address specified above, except that written notices to
the Primary Liquidity Provider pursuant to the provisions of Article II and
Article III hereof shall not be effective until received by the Primary
Liquidity Provider. A copy of all notices delivered hereunder to either party
shall in addition be delivered to each of the parties to the Participation
Agreements at their respective addresses set forth therein.
Section 7.03. NO WAIVER; REMEDIES. No failure on the part of the
Primary Liquidity Provider to exercise, and no delay in exercising, any right
under this Agreement shall operate as a waiver thereof; nor shall any single or
partial exercise of any right under this Agreement preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 7.04. FURTHER ASSURANCES. The Borrower agrees to do such
further acts and things and to execute and deliver to the Primary Liquidity
Provider such additional assignments, agreements, powers and instruments as the
Primary Liquidity Provider may reasonably require or deem advisable to carry
into effect the purposes of this Agreement and the other Operative Agreements or
to better assure and confirm unto the Primary Liquidity Provider its rights,
powers and remedies hereunder and under the other Operative Agreements.
Section 7.05. INDEMNIFICATION; SURVIVAL OF CERTAIN PROVISIONS. The
Primary Liquidity Provider shall be indemnified hereunder to the extent and in
the manner described in Section 8.1 of the Participation Agreements with respect
to Aircraft. In addition, the Borrower agrees to indemnify, protect, defend and
hold harmless the Primary Liquidity Provider from, against and in respect of,
and shall pay on demand, all Expenses of any kind or nature whatsoever (other
than any Expenses of the nature described in Section 3.01, 3.02 or 7.07 hereof
or in the Fee Letter applicable to this Agreement (regardless of whether
indemnified against pursuant to said Sections or in such Fee Letter)), that may
be imposed, incurred by or asserted against any Liquidity Indemnitee, in any way
relating to, resulting from, or arising out of or in connection with any action,
suit or proceeding by any third party against such Liquidity Indemnitee and
relating to this Agreement, the Fee Letter applicable to this Agreement, the
Intercreditor Agreement or any Financing Agreement; PROVIDED, HOWEVER, that the
Borrower shall not be required to indemnify, protect, defend and hold harmless
any Liquidity Indemnitee in respect of any Expense of such Liquidity Indemnitee
to the extent such Expense is (i) attributable to the gross negligence or
willful misconduct of such Liquidity Indemnitee or any other Liquidity
Indemnitee, (ii) ordinary and usual operating overhead expense, or (iii)
attributable to the failure by such Liquidity Indemnitee or any other Liquidity
Indemnitee to perform or observe any agreement, covenant or condition on its
part to be performed or observed in this Agreement, the Intercreditor Agreement,
the Fee Letter applicable to this Agreement, the Tax Letter or any other
Operative Agreement to which it is a party. The indemnities contained in Section
8.1 of the Participation Agreements, and the provisions of Sections 3.01, 3.02,
3.03, 3.09, 7.05 and 7.07 hereof, shall survive the termination of this
Agreement.
Section 7.06. LIABILITY OF THE PRIMARY LIQUIDITY PROVIDER. (a)
Neither the Primary Liquidity Provider nor any of its officers, employees,
directors or Affiliates shall be liable or responsible for: (i) the use which
may be made of the Advances or any acts or omissions of the Borrower or any
beneficiary or transferee in connection therewith; (ii) the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; or (iii) the making of Advances by the Primary Liquidity
Provider against delivery of a Notice of Borrowing and other documents which do
not comply with the terms hereof; PROVIDED, HOWEVER, that the Borrower shall
have a claim against the Primary Liquidity Provider, and the Primary Liquidity
Provider shall be liable to the Borrower, to the extent of any damages suffered
by the Borrower which were the result of (A) the Primary Liquidity Provider's
willful misconduct or negligence in determining whether documents presented
hereunder comply with the terms hereof, or (B) any breach by the Primary
Liquidity Provider of any of the terms of this Agreement, including, but not
limited to, the Primary Liquidity Provider's failure to make lawful payment
hereunder after the delivery to it by the Borrower of a Notice of Borrowing
strictly complying with the terms and conditions hereof.
(b) Neither the Primary Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible in any respect
for (i) any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with this
Agreement or any Notice of Borrowing delivered hereunder, or (ii) any action,
inaction or omission which may be taken by it in good faith, absent willful
misconduct or negligence (in which event the extent of the Primary Liquidity
Provider's potential liability to the Borrower shall be limited as set forth in
the immediately preceding paragraph), in connection with this Agreement or any
Notice of Borrowing.
Section 7.07. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay,
or cause to be paid (A) on the Effective Date and on such later date or dates on
which the Primary Liquidity Provider shall make demand, all reasonable
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of outside counsel for the Primary Liquidity Provider) of the
Primary Liquidity Provider in connection with the preparation, negotiation,
execution, delivery, filing and recording of this Agreement, any other Operative
Agreement and any other documents which may be delivered in connection with this
Agreement and (B) on demand, all reasonable costs and expenses (including
reasonable counsel fees and expenses) of the Primary Liquidity Provider in
connection with (i) the enforcement of this Agreement or any other Operative
Agreement, (ii) the modification or amendment of, or supplement to, this
Agreement or any other Operative Agreement or such other documents which may be
delivered in connection herewith or therewith (whether or not the same shall
become effective) or (iii) any action or proceeding relating to any order,
injunction, or other process or decree restraining or seeking to restrain the
Primary Liquidity Provider from paying any amount under this Agreement, the
Intercreditor Agreement or any other Operative Agreement or otherwise affecting
the application of funds in the Class G-1 Cash Collateral Account. In addition,
the Borrower shall pay any and all recording, stamp and other similar taxes and
fees payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, any other Operative Agreement
and such other documents, and agrees to save the Primary Liquidity Provider
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes or fees.
Section 7.08. BINDING EFFECT; PARTICIPATIONS. (a) This Agreement
shall be binding upon and inure to the benefit of the Borrower and the Primary
Liquidity Provider and their respective successors and assigns, except that
neither the Primary Liquidity Provider (except as otherwise provided in this
Section 7.08) nor (except as contemplated by Section 3.08) the Borrower shall
have the right to assign its rights or obligations hereunder or any interest
herein without the prior written consent of the other party, subject to the
requirements of Section 7.08(b). The Primary Liquidity Provider may grant
participations herein or in any of its rights hereunder (including, without
limitation, funded participations and participations in rights to receive
interest payments hereunder) and under the other Operative Agreements to such
Persons (other than Continental and its Affiliates) as the Primary Liquidity
Provider may in its sole discretion select, subject to the requirements of
Section 7.08(b). No such granting of participations by the Primary Liquidity
Provider, however, will relieve the Primary Liquidity Provider of its
obligations hereunder. In connection with any participation or any proposed
participation, the Primary Liquidity Provider may disclose to the participant or
the proposed participant any information that the Borrower is required to
deliver or to disclose to the Primary Liquidity Provider pursuant to this
Agreement. The Borrower acknowledges and agrees that the Primary Liquidity
Provider's source of funds may derive in part from its participants.
Accordingly, references in this Agreement and the other Operative Agreements to
determinations, reserve and capital adequacy requirements, increased costs,
reduced receipts, additional amounts due pursuant to Section 3.03 and the like
as they pertain to the Primary Liquidity Provider shall be deemed also to
include those of each of its participants that are banks (subject, in each case,
to the maximum amount that would have been incurred by or attributable to the
Primary Liquidity Provider directly if the Primary Liquidity Provider, rather
than the participant, had held the interest participated).
(b) If, pursuant to subsection (a) above, the Primary Liquidity
Provider sells any participation in this Agreement to any bank or other entity
(each, a "TRANSFEREE"), then, concurrently with the effectiveness of such
participation, the Transferee shall (i) represent to the Primary Liquidity
Provider (for the benefit of the Primary Liquidity Provider and the Borrower)
either (A) that it is incorporated under the laws of the United States or a
state thereof or (B) that under applicable law and treaties, no taxes will be
required to be withheld with respect to any payments to be made to such
Transferee in respect of this Agreement, (ii) furnish to the Primary Liquidity
Provider and the Borrower either (x) a statement that it is incorporated under
the laws of the United States or a state thereof or (y) if it is not so
incorporated, two copies of a properly completed United States Internal Revenue
Service Form W-8ECI or Form W-8BEN, as appropriate, or other applicable form,
certificate or document prescribed by the Internal Revenue Service certifying,
in each case, such Transferee's entitlement to a complete exemption from United
States federal withholding tax in respect to any and all payments to be made
hereunder, and (iii) agree (for the benefit of the Primary Liquidity Provider
and the Borrower) to provide the Primary Liquidity Provider and the Borrower a
new Form W-8ECI or Form W-8BEN, as appropriate, (A) on or before the date that
any such form expires or becomes obsolete or (B) after the occurrence of any
event requiring a change in the most recent form previously delivered by it and
prior to the immediately following due date of any payment by the Borrower
hereunder, certifying in the case of a Form W-8BEN or Form W-8ECI that such
Transferee is entitled to a complete exemption from United States federal
withholding tax on payments under this Agreement. Unless the Borrower has
received forms or other documents reasonably satisfactory to it (and required by
applicable law) indicating that payments hereunder are not subject to United
States federal withholding tax, the Borrower will withhold taxes as required by
law from such payments at the applicable statutory rate.
(c) Notwithstanding the other provisions of this Section 7.08, the
Primary Liquidity Provider may assign and pledge all or any portion of the
Advances owing to it to any Federal Reserve Bank or the United States Treasury
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank, provided that any payment in respect of such assigned Advances made by the
Borrower to the Primary Liquidity Provider in accordance with the terms of this
Agreement shall satisfy the Borrower's obligations hereunder in respect of such
assigned Advance to the extent of such payment. No such assignment shall release
the Primary Liquidity Provider from its obligations hereunder.
Section 7.09. Third Party Beneficiary. The Policy Provider is an
intended third party beneficiary with respect to the provisions of Sections
2.02(c) and 2.10 of this Agreement.
Section 7.10. SEVERABILITY. Any provision of this Agreement which is
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction.
Section 7.11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Section 7.12. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
WAIVER OF IMMUNITY. (a) Each of the parties hereto hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Operative Agreement, or
for recognition and enforcement of any judgment in respect hereof or
thereof, to the nonexclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the
Southern District of New York, and the appellate courts from any thereof;
(ii) consents that any such action or proceeding may be brought in
such courts, and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to each party hereto at its address set forth in Section 7.02
hereof, or at such other address of which the Primary Liquidity Provider
shall have been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction.
(b) THE BORROWER AND THE PRIMARY LIQUIDITY PROVIDER EACH HEREBY
AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS
BEING ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. The
Borrower and the Primary Liquidity Provider each warrant and represent that it
has reviewed this waiver with its legal counsel, and that it knowingly and
voluntarily waives its jury trial rights following consultation with such legal
counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(c) The Primary Liquidity Provider hereby waives any immunity it may
have from the jurisdiction of the courts of the United States or of any State
and waives any immunity any of its properties located in the United States may
have from attachment or execution upon a judgment entered by any such court
under the United States Foreign Sovereign Immunities Act of 1976 or any similar
successor legislation.
Section 7.13. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 7.14. ENTIRETY. This Agreement, the Intercreditor Agreement
and the other Operative Agreements to which the Primary Liquidity Provider is a
party constitute the entire agreement of the parties hereto with respect to the
subject matter hereof and supersedes all prior understandings and agreements of
such parties.
Section 7.15. HEADINGS. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
Section 7.16. TRANSFER. The Primary Liquidity Provider hereby
acknowledges and consents to the Transfer contemplated by the Assignment and
Assumption Agreement.
Section 7.17. PRIMARY LIQUIDITY PROVIDER'S OBLIGATION TO MAKE
ADVANCES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS OF
THE PRIMARY LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE BORROWER'S
RIGHTS TO DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF ADVANCES
HEREUNDER, SHALL BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR
PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first set forth above.
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Subordination Agent, as agent and
trustee for the Class G-1 Trust,
as Borrower
By:
--------------------------------------
Name:
Title:
LANDESBANK HESSEN-THURINGEN GIROZENTRALE,
as Primary Liquidity Provider
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
ANNEX I TO
REVOLVING CREDIT AGREEMENT
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-1) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of an Interest Advance by the Primary Liquidity Provider to be
used, subject to clause (3)(v) below, for the payment of interest on the
Class G-1 Certificates which was payable on ____________, ____ (the
"DISTRIBUTION DATE") in accordance with the terms and provisions of the
Class G-1 Trust Agreement and the Class G-1 Certificates, which Advance is
requested to be made on ____________, ____. The Interest Advance should be
transferred to [name of bank/wire instructions/ABA number] in favor of
account number [ ], reference [ ].
(3) The amount of the Interest Advance requested hereby (i) is
$[_________________], to be applied in respect of the payment of the
interest which was due and payable on the Class G-1 Certificates on the
Distribution Date, (ii) does not include any amount with respect to the
payment of principal of, or premium on, the Class G-1 Certificates, or
principal of, or interest or premium on, the Class G-2 Certificates, the
Class H Certificates, the Class I Certificates or the Class J
Certificates, (iii) was computed in accordance with the provisions of the
Class G-1 Certificates, the Class G-1 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), (iv) does not exceed the Maximum Available Commitment on the
date hereof, (v) does not include any amount of interest which was due and
payable on the Class G-1 Certificates on such Distribution Date but which
remains unpaid due to the failure of the Depositary to pay any amount of
accrued interest on the Deposits on such Distribution Date and (vi) has
not been and is not the subject of a prior or contemporaneous Notice of
Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will apply the same in accordance with
the terms of Section 3.6(b) of the Intercreditor Agreement, (b) no portion
of such amount shall be applied by the Borrower for any other purpose and
(c) no portion of such amount until so applied shall be commingled with
other funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, the making of the Interest Advance as requested by this Notice of
Borrowing shall automatically reduce, subject to reinstatement in accordance
with the terms of the Liquidity Agreement, the Maximum Available Commitment by
an amount equal to the amount of the Interest Advance requested to be made
hereby as set forth in clause (i) of paragraph (3) of this Notice of Borrowing
and such reduction shall automatically result in corresponding reductions in the
amounts available to be borrowed pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:
------------------------------------
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with Interest
Advance Notice of Borrowing]
ANNEX II TO
REVOLVING CREDIT AGREEMENT
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-1) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Non-Extension Advance by the Primary Liquidity Provider to
be used for the funding of the Class G-1 Cash Collateral Account in
accordance with Section 3.6(d) of the Intercreditor Agreement, which
Advance is requested to be made on __________, ____. The Non-Extension
Advance should be transferred to [name of bank/wire instructions/ABA
number] in favor of account number [ ], reference [ ].
(3) The amount of the Non-Extension Advance requested hereby (i) is
$_______________.__, which equals the Maximum Available Commitment on the
date hereof and is to be applied in respect of the funding of the Class
G-1 Cash Collateral Account in accordance with Section 3.6(d) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of the principal of, or premium on, the Class G-1
Certificates, or principal of, or interest or premium on, the Class G-2
Certificates, the Class H Certificates, the Class I Certificates or the
Class J Certificates, (iii) was computed in accordance with the provisions
of the Class G-1 Certificates, the Class G-1 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-1 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(d) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Non-Extension Advance as requested by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of the Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Non-Extension Advance requested by this Notice of Borrowing, the Borrower shall
not be entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Subordination Agent,
as Borrower
By:
------------------------------------
Name:
Title:
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with Non-Extension
Advance Notice of Borrowing]
ANNEX III TO
REVOLVING CREDIT AGREEMENT
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-1) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Downgrade Advance by the Primary Liquidity Provider to be
used for the funding of the Class G-1 Cash Collateral Account in
accordance with Section 3.6(c) of the Intercreditor Agreement by reason of
the occurrence of a Downgrade Event, which Advance is requested to be made
on __________, ____. The Downgrade Advance should be transferred to [name
of bank/wire instructions/ABA number] in favor of account number [ ],
reference [ ].
(3) The amount of the Downgrade Advance requested hereby (i) is
$_______________.__, which equals the Maximum Available Commitment on the
date hereof and is to be applied in respect of the funding of the Class
G-1 Cash Collateral Account in accordance with Section 3.6(c) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of the principal of, or premium on, the Class G-1
Certificates, or principal of, or interest or premium on, the Class G-2
Certificates, the Class H Certificates, the Class I Certificates or the
Class J Certificates, (iii) was computed in accordance with the provisions
of the Class G-1 Certificates, the Class G-1 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-1 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(c) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Downgrade Advance as requested by this Notice
of Borrowing shall automatically and irrevocably terminate the obligation of the
Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Downgrade Advance requested by this Notice of Borrowing, the Borrower shall not
be entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Subordination Agent,
as Borrower
By:
------------------------------------
Name:
Title:
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with Downgrade
Advance Notice of Borrowing]
ANNEX IV TO
REVOLVING CREDIT AGREEMENT
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-1) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Final Advance by the Primary Liquidity Provider to be used
for the funding of the Class G-1 Cash Collateral Account in accordance
with Section 3.6(i) of the Intercreditor Agreement by reason of the
receipt by the Borrower of a Termination Notice from the Primary Liquidity
Provider with respect to the Liquidity Agreement, which Advance is
requested to be made on ____________, ____. The Final Advance should be
transferred to [name of bank/wire instructions/ABA number] in favor of
account number [ ], reference [ ].
(3) The amount of the Final Advance requested hereby (i) is
$_________________.__, which equals the Maximum Available Commitment on
the date hereof and is to be applied in respect of the funding of the
Class G-1 Cash Collateral Account in accordance with Section 3.6(i) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of principal of, or premium on, the Class G-1 Certificates, or
principal of, or interest or premium on, the Class G-2 Certificates, the
Class H Certificates, the Class I Certificates or the Class J
Certificates, (iii) was computed in accordance with the provisions of the
Class G-1 Certificates, the Class G-1 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-1 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(i) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
(5) The Borrower hereby requests that the Advance requested hereby
be a Base Rate Advance [and that such Base Rate Advance be converted into
a LIBOR Advance on the third Business Day following your receipt of this
notice.]
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Final Advance as requested by this Notice of
Borrowing shall automatically and irrevocably terminate the obligation of the
Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Final Advance requested by this Notice of Borrowing, the Borrower shall not be
entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Subordination Agent,
as Borrower
By:
------------------------------------
Name:
Title:
- -------------------
Bracketed language may be included at Borrower's option.
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with Final Advance
Notice of Borrowing]
ANNEX V TO
REVOLVING CREDIT AGREEMENT
NOTICE OF TERMINATION
[Date]
Wilmington Trust Company,
as Subordination Agent, as Borrower
Rodney Square North
1100 North Market Square
Wilmington, DE 19890-0001
Attention: Corporate Trust Administration
Revolving Credit Agreement dated as of March 25, 2002 between
Wilmington Trust Company, as Subordination Agent, as agent
and trustee for the Continental Airlines Pass Through Trust,
2002-1G-1-[O/S], as Borrower, and Landesbank Hessen-Thuringen
Girozentrale (the "LIQUIDITY AGREEMENT")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the Liquidity
Agreement, by reason of the occurrence of a Liquidity Event of Default and the
existence of a Performing Note Deficiency (each as defined therein), we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined therein) under such Liquidity Agreement to terminate on the fifth
Business Day after the date on which you receive this notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a
consequence of your receipt of this notice.
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE
LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY
AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.
Very truly yours,
LANDESBANK HESSEN-THURINGEN GIROZENTRALE
as Primary Liquidity Provider
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
cc: Wilmington Trust Company,
as Class G-1 Trustee
ANNEX VI TO
REVOLVING CREDIT AGREEMENT
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Revolving Credit Agreement dated as of March 25, 2002, between
Wilmington Trust Company, as Subordination Agent, as agent and
trustee for the Continental Airlines Pass Through Trust,
2002-1G-1-[O/S], as Borrower, and Landesbank Hessen-Thuringen
Girozentrale (the "LIQUIDITY AGREEMENT")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
------------------------------
[Name of Transferee]
------------------------------
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the Liquidity
Agreement referred to above. The transferee has succeeded the undersigned as
Subordination Agent under the Intercreditor Agreement referred to in the first
paragraph of the Liquidity Agreement, pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower under
the Liquidity Agreement are transferred to the transferee and the transferee
shall hereafter have the sole rights and obligations as Borrower thereunder. The
undersigned shall pay any costs and expenses of such transfer, including, but
not limited to, transfer taxes or governmental charges.
We ask that this transfer be effective as of _______________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Subordination Agent,
as Borrower
By:
-------------------------------------
Name:
Title:
SCHEDULE 1
* Subject to adjustment in accordance with the Following
Business Day Convention (as defined in the Class G-1
Above Cap Liquidity Facility)
BEGINNING OF INTEREST PERIOD* CAPPED LIBOR
Mar 26, 2002 7.00%
May 15, 2002 7.05%
Aug 15, 2002 7.15%
Nov 15, 2002 7.15%
Feb 15, 2003 7.25%
May 15, 2003 7.25%
Aug 15, 2003 7.40%
Nov 15, 2003 7.40%
Feb 15, 2004 7.60%
May 15, 2004 7.60%
Aug 15, 2004 7.85%
Nov 15, 2004 7.85%
Feb 15, 2005 8.15%
May 15, 2005 8.15%
Aug 15, 2005 8.50%
Nov 15, 2005 8.50%
Feb 15, 2006 8.90%
May 15, 2006 8.90%
Aug 15, 2006 9.35%
Nov 15, 2006 9.35%
Feb 15, 2007 9.85%
May 15, 2007 9.85%
Aug 15, 2007 10.35%
Nov 15, 2007 10.35%
Feb 15, 2008 10.85%
May 15, 2008 10.85%
Aug 15, 2008 11.40%
Nov 15, 2008 11.40%
Feb 15, 2009 12.10%
May 15, 2009 12.10%
Aug 15, 2009 12.65%
Nov 15, 2009 12.65%
Feb 15, 2010 13.35%
May 15, 2010 13.35%
Aug 15, 2010 14.10%
Nov 15, 2010 14.10%
Feb 15, 2011 14.75%
May 15, 2011 14.75%
Aug 15, 2011 15.00%
Nov 15, 2011 15.00%
Feb 15, 2012 15.00%
May 15, 2012 15.00%
Aug 15, 2012 15.00%
Nov 15, 2012 15.00%
Feb 15, 2013 15.00%
May 15, 2013 15.00%
Aug 15, 2013 15.00%
===============================================================================
REVOLVING CREDIT AGREEMENT
(2002-1G-2)
DATED AS OF MARCH 25, 2002
BETWEEN
WILMINGTON TRUST COMPANY,
AS SUBORDINATION AGENT,
AS AGENT AND TRUSTEE FOR THE
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-2
AS BORROWER
AND
LANDESBANK HESSEN-THURINGEN GIROZENTRALE
AS PRIMARY LIQUIDITY PROVIDER
===============================================================================
RELATING TO
CONTINENTAL AIRLINES PASS THROUGH TRUST 2002-1G-2
6.563% CONTINENTAL AIRLINES PASS THROUGH CERTIFICATES,
SERIES 2002-1G-2
TABLE OF CONTENTS
PAGE
----
ARTICLE I DEFINITIONS.........................................................1
Section 1.01. Certain Defined Terms.........................................1
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT.................................8
Section 2.01. The Advances...................................................8
Section 2.02. Making the Advances............................................8
Section 2.03. Fees..........................................................10
Section 2.04. Reductions or Termination of the Maximum Commitment...........10
Section 2.05. Repayments of Interest Advances or the Final Advance..........10
Section 2.06. Repayments of Provider Advances...............................11
Section 2.07. Payments to the Primary Liquidity Provider Under the
Intercreditor Agreement.......................................12
Section 2.08. Book Entries..................................................12
Section 2.09. Payments from Available Funds Only............................12
Section 2.10. Extension of the Expiry Date; Non-Extension Advance...........12
Section 2.11. Right to Further Extend Expiry Date...........................13
ARTICLE III OBLIGATIONS OF THE BORROWER......................................13
Section 3.01. Increased Costs...............................................13
Section 3.02. Capital Adequacy..............................................14
Section 3.03. Payments Free of Deductions...................................15
Section 3.04. Payments......................................................16
Section 3.05. Computations..................................................16
Section 3.06. Payment on Non-Business Days..................................16
Section 3.07. Interest......................................................17
Section 3.08. Replacement of Borrower.......................................18
Section 3.09. Funding Loss Indemnification..................................18
Section 3.10. Illegality....................................................18
ARTICLE IV CONDITIONS PRECEDENT..............................................19
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.........19
Section 4.02. Conditions Precedent to Borrowing.............................21
ARTICLE V COVENANTS..........................................................21
Section 5.01. Affirmative Covenants of the Borrower.........................21
Section 5.02. Negative Covenants of the Borrower............................22
ARTICLE VI LIQUIDITY EVENTS OF DEFAULT.......................................22
Section 6.01. Liquidity Events of Default...................................22
ARTICLE VII MISCELLANEOUS....................................................22
Section 7.01. Amendments, Etc...............................................22
PAGE
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Section 7.02. Notices, Etc..................................................23
Section 7.03. No Waiver; Remedies...........................................23
Section 7.04. Further Assurances............................................24
Section 7.05. Indemnification; Survival of Certain Provisions...............24
Section 7.06. Liability of the Primary Liquidity Provider...................24
Section 7.07. Costs, Expenses and Taxes.....................................25
Section 7.08. Binding Effect; Participations................................25
Section 7.09. Third Party Beneficiary.......................................27
Section 7.10. Severability..................................................27
Section 7.11. GOVERNING LAW.................................................27
Section 7.12. Submission to Jurisdiction; Waiver of Jury Trial;
Waiver of Immunity............................................27
Section 7.13. Execution in Counterparts.....................................28
Section 7.14. Entirety......................................................28
Section 7.15. Headings......................................................28
Section 7.16. Transfer......................................................28
Section 7.17. PRIMARY LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES......28
ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
REVOLVING CREDIT AGREEMENT (2002-1G-2)
This REVOLVING CREDIT AGREEMENT (2002-1G-2) dated as of March 25,
2002, between WILMINGTON TRUST COMPANY, a Delaware corporation, not in its
individual capacity but solely as Subordination Agent under the Intercreditor
Agreement (each as defined below), as agent and trustee for the Class G-2 Trust
(as defined below) (the "BORROWER"), and LANDESBANK HESSEN-THURINGEN
GIROZENTRALE, a public-law banking institution organized under the laws of
Germany (the "PRIMARY LIQUIDITY PROVIDER").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Class G-2 Trust Agreement (such term and
all other capitalized terms used in these recitals having the meanings set forth
or referred to in Section 1.01), the Class G-2 Trust is issuing the Class G-2
Certificates; and
WHEREAS, the Borrower, in order to support the timely payment of a
portion of the interest on the Class G-2 Certificates in accordance with their
terms, has requested the Primary Liquidity Provider to enter into this
Agreement, providing in part for the Borrower to request in specified
circumstances that Advances be made hereunder.
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms. (a) DEFINITIONS. As used in
this Agreement and unless otherwise expressly indicated, or unless the context
clearly requires otherwise, the following capitalized terms shall have the
following respective meanings for all purposes of this Agreement:
"ADDITIONAL COST" has the meaning assigned to such term in Section
3.01.
"ADVANCE" means an Interest Advance, a Final Advance, a Provider
Advance or an Applied Provider Advance, as the case may be.
"APPLICABLE LIQUIDITY RATE" has the meaning assigned to such term in
Section 3.07(g).
"APPLICABLE MARGIN" means (x) with respect to any Unpaid Advance or
Applied Provider Advance, 1.50% per annum, or (y) with respect to any
Unapplied Provider Advance, the rate per annum specified in the Fee
Letter.
"APPLIED DOWNGRADE ADVANCE" has the meaning assigned to such term in
Section 2.06(a).
"APPLIED NON-EXTENSION ADVANCE" has the meaning assigned to such
term in Section 2.06(a).
"APPLIED PROVIDER ADVANCE" has the meaning assigned to such term in
Section 2.06(a).
"ASSIGNMENT AND ASSUMPTION AGREEMENT" means the Assignment and
Assumption Agreement to be entered into between the Borrower and the
trustee of the Successor Trust, substantially in the form of Exhibit C to
the Trust Supplement No. 2002-1G-2-O, dated as of the date hereof,
relating to the Class G-2 Trust.
"BASE RATE" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to (a)
the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New
York, or if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day for such transactions
received by the Primary Liquidity Provider from three Federal funds
brokers of recognized standing selected by it, plus (b) one-quarter of one
percent (1/4 of 1%).
"BASE RATE ADVANCE" means an Advance that bears interest at a rate
based upon the Base Rate.
"BORROWER" has the meaning assigned to such term in the recital of
parties to this Agreement.
"BORROWING" means the making of Advances requested by delivery of a
Notice of Borrowing.
"BUSINESS DAY" means any day other than a Saturday or Sunday or a
day on which commercial banks are required or authorized to close in
Houston, Texas, New York, New York or, so long as any Class G-2
Certificate is outstanding, the city and state in which the Class G-2
Trustee, the Borrower or any Loan Trustee maintains its Corporate Trust
Office or receives or disburses funds, and, if the applicable Business Day
relates to any Advance or other amount bearing interest based on the LIBOR
Rate, on which dealings are carried on in the London interbank market.
"CONSENT PERIOD" has the meaning specified in Section 2.10.
"DEPOSIT AGREEMENT" means the Deposit Agreement dated as of the date
hereof between Wells Fargo Bank Northwest, National Association, as Escrow
Agent, and Credit Suisse First Boston, New York Branch, as Depositary,
pertaining to the Class G-2 Certificates, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"DEPOSITARY" has the meaning assigned to such term in the Deposit
Agreement.
"DEPOSITS" has the meaning assigned to such term in the Deposit
Agreement.
"DOWNGRADE ADVANCE" means an Advance made pursuant to Section
2.02(c).
"DOWNGRADE EVENT" means a downgrading of the Primary Liquidity
Provider's short-term unsecured debt rating or issuer credit rating (as
applicable) issued by either Rating Agency below the applicable Threshold
Rating unless each Rating Agency shall have confirmed in writing on or
prior to the date of such downgrading that such downgrading will not
result in the downgrading, withdrawal or suspension of the ratings of the
Class G-2 Certificates (without regard to the Policies), in which case,
such downgrading of the Primary Liquidity Provider's short-term unsecured
debt rating or issuer credit rating (as applicable) shall not constitute a
Downgrade Event and shall be referred to herein as a "HELABA DOWNGRADE".
"EFFECTIVE DATE" has the meaning specified in Section 4.01. The
delivery of the certificate of the Primary Liquidity Provider contemplated
by Section 4.01(e) shall be conclusive evidence that the Effective Date
has occurred.
"EXCLUDED TAXES" means (i) taxes imposed on the overall net income
of the Primary Liquidity Provider or of its Facility Office by the
jurisdiction where such Primary Liquidity Provider's principal office or
such Facility Office is located, and (ii) Excluded Withholding Taxes.
"EXCLUDED WITHHOLDING TAXES" means (i) withholding Taxes imposed by
the United States except to the extent that such United States withholding
Taxes are imposed or increased as a result of any change in applicable law
(excluding from change in applicable law for this purpose a change in an
applicable treaty or other change in law affecting the applicability of a
treaty) after the date hereof, or in the case of a successor Primary
Liquidity Provider (including a transferee of an Advance) or Facility
Office, after the date on which such successor Primary Liquidity Provider
obtains its interest or on which the Facility Office is changed, and (ii)
any withholding Taxes imposed by the United States which are imposed or
increased as a result of the Primary Liquidity Provider failing to deliver
to the Borrower any certificate or document (which certificate or document
in the good faith judgment of the Primary Liquidity Provider it is legally
entitled to provide) which is reasonably requested by the Borrower to
establish that payments under this Agreement are exempt from (or entitled
to a reduced rate of) withholding Tax.
"EXPENSES" means liabilities, obligations, damages, settlements,
penalties, claims, actions, suits, costs, expenses, and disbursements
(including, without limitation, reasonable fees and disbursements of legal
counsel and costs of investigation), provided that Expenses shall not
include any Taxes.
"EXPIRY DATE" means March 23, 2003, initially, or any date to which
the Expiry Date is extended pursuant to Section 2.10 or 2.11.
"EXTENSION EFFECTIVE DATE" has the meaning assigned to such term in
Section 2.11.
"FACILITY OFFICE" means the office of the Primary Liquidity Provider
presently located at Frankfurt, Germany, or such other office as the
Primary Liquidity Provider from time to time shall notify the Borrower as
its Facility Office hereunder; provided that the Primary Liquidity
Provider shall not change its Facility Office to another Facility Office
outside the United States of America except in accordance with Section
3.01, 3.02 or 3.03 hereof.
"FINAL ADVANCE" means an Advance made pursuant to Section 2.02(d).
"GAAP" means generally accepted accounting principles as set forth
in the statements of financial accounting standards issued by the
Financial Accounting Standards Board of the American Institute of
Certified Public Accountants, as such principles may at any time or from
time to time be varied by any applicable financial accounting rules or
regulations issued by the Securities and Exchange Commission and, with
respect to any person, shall mean such principles applied on a basis
consistent with prior periods except as may be disclosed in such person's
financial statements.
"HELABA DOWNGRADE" has the meaning assigned to such term in the
definition of "Downgrade Event".
"INTERCREDITOR AGREEMENT" means the Intercreditor Agreement dated as
of the date hereof among the Trustees, the Primary Liquidity Provider, the
liquidity provider under the other Primary Liquidity Facility, the Class
G-1 Above-Cap Liquidity Provider, the Policy Provider and the
Subordination Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"INTEREST ADVANCE" means an Advance made pursuant to Section
2.02(a).
"INTEREST PERIOD" means, with respect to any LIBOR Advance, each of
the following periods:
(i) the period beginning on the third Business Day following
either (x) the Primary Liquidity Provider's receipt of the
Notice of Borrowing for such LIBOR Advance or (y) the
withdrawal of funds from the Class G-2 Cash Collateral Account
for the purpose of paying interest on the Class G-2
Certificates as contemplated by Section 2.06(a) hereof and, in
either case, ending on the next Regular Distribution Date; and
(ii) each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the next
Regular Distribution Date;
PROVIDED, HOWEVER, that if (x) the Final Advance shall have been made, or
(y) other outstanding Advances shall have been converted into the Final
Advance, then the Interest Periods shall be successive periods of one
month beginning on the third Business Day following the Primary Liquidity
Provider's receipt of the Notice of Borrowing for such Final Advance (in
the case of clause (x) above) or the Regular Distribution Date following
such conversion (in the case of clause (y) above).
"LIBOR ADVANCE" means an Advance bearing interest at a rate based
upon the LIBOR Rate.
"LIBOR RATE" means, with respect to any Interest Period, ----------
(i) the rate per annum appearing on display page 3750 (British
Bankers Association-LIBOR) of the Dow Jones Markets Service
(or any successor or substitute therefor) at approximately
11:00 A.M. (London time) two Business Days before the first
day of such Interest Period, as the rate for dollar deposits
with a maturity comparable to such Interest Period, or
(ii) if the rate calculated pursuant to clause (i) above is not
available, the average (rounded upwards, if necessary, to the
next 1/16 of 1%) of the rates per annum at which deposits in
dollars are offered for the relevant Interest Period by three
banks of recognized standing selected by the Primary Liquidity
Provider in the London interbank market at approximately 11:00
A.M. (London time) two Business Days before the first day of
such Interest Period in an amount approximately equal to the
principal amount of the LIBOR Advance to which such Interest
Period is to apply and for a period comparable to such
Interest Period.
"LIQUIDITY EVENT OF DEFAULT" means the occurrence of either (a) the
Acceleration of all of the Equipment Notes (PROVIDED that, with respect to
the period prior to the Delivery Period Expiry Date, such Equipment Notes
have an aggregate outstanding principal balance in excess of $140,000,000)
or (b) a Continental Bankruptcy Event.
"LIQUIDITY INDEMNITEE" means (i) the Primary Liquidity Provider,
(ii) the directors, officers, employees and agents of the Primary
Liquidity Provider, and (iii) the successors and permitted assigns of the
persons described in clauses (i) and (ii), inclusive.
"MAXIMUM AVAILABLE COMMITMENT" shall mean, subject to the proviso
contained in the third sentence of Section 2.02(a), at any time of
determination, (a) the Maximum Commitment at such time LESS (b) the
aggregate amount of each Interest Advance outstanding at such time;
PROVIDED that following a Provider Advance or a Final Advance, the Maximum
Available Commitment shall be zero.
"MAXIMUM COMMITMENT" means initially $19,149,718.29 as the same may
be reduced from time to time in accordance with Section 2.04(a).
"NON-EXCLUDED TAX" has the meaning specified in Section 3.03.
"NON-EXTENSION ADVANCE" means an Advance made pursuant to Section
2.02(b).
"NOTICE OF BORROWING" has the meaning specified in Section 2.02(e).
"NOTICE OF REPLACEMENT SUBORDINATION AGENT" has the meaning
specified in Section 3.08.
"PERFORMING NOTE DEFICIENCY" means any time that less than 65% of
the then aggregate outstanding principal amount of all Equipment Notes
(other than any "Series J Equipment Notes" under and as defined in any
Indenture) are Performing Equipment Notes.
"PRIMARY LIQUIDITY PROVIDER" has the meaning assigned to such term
in the recital of parties to this Agreement.
"PROSPECTUS SUPPLEMENT" means the final Prospectus Supplement dated
March 11, 2002 relating to the Class G-1 Certificates and the Class G-2
Certificates, as such Prospectus Supplement may be amended or
supplemented.
"PROVIDER ADVANCE" means a Downgrade Advance or a Non-Extension
Advance.
"REGULATORY CHANGE" has the meaning assigned to such term in Section
3.01.
"REPLENISHMENT AMOUNT" has the meaning assigned to such term in
Section 2.06(b).
"REQUIRED AMOUNT" means, for any day, the sum of the aggregate
amount of interest, calculated at the rate per annum equal to the Stated
Interest Rate for the Class G-2 Certificates, that would be payable on the
Class G-2 Certificates on each of the six successive quarterly Regular
Distribution Dates immediately following such day or, if such day is a
Regular Distribution Date, on such day and the succeeding five quarterly
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of the Class G-2 Certificates on such day and without regard
to expected future payments of principal on the Class G-2 Certificates.
Notwithstanding the above, in the event of any Policy Provider Election,
for purposes of the definition of the Required Amount the Pool Balance
shall be deemed to be reduced by the amount by which (a) the then
outstanding principal balance of each Series G-2 Equipment Note in respect
of which such Policy Provider Election has been made shall exceed (b) the
amount of any Policy Drawings previously paid by the Policy Provider in
respect of principal on such Series G-2 Equipment Note.
"SUCCESSOR TRUST" means Continental Airlines Pass Through Trust
2002-1G-2-S.
"TAX LETTER" means the letter dated the date hereof between the
Liquidity Provider and Continental pertaining to this Agreement.
"TERMINATION DATE" means the earliest to occur of the following: (i)
the Expiry Date; (ii) the date on which the Borrower delivers to the
Primary Liquidity Provider a certificate, signed by a Responsible Officer
of the Borrower, certifying that all of the Class G-2 Certificates have
been paid in full (or provision has been made for such payment in
accordance with the Intercreditor Agreement and the Trust Agreements) or
are otherwise no longer entitled to the benefits of this Agreement; (iii)
the date on which the Borrower delivers to the Primary Liquidity Provider
a certificate, signed by a Responsible Officer of the Borrower, certifying
that a Replacement Primary Liquidity Facility has been substituted for
this Agreement in full pursuant to Section 3.6(e) of the Intercreditor
Agreement; (iv) the fifth Business Day following the receipt by the
Borrower of a Termination Notice from the Primary Liquidity Provider
pursuant to Section 6.01 hereof; and (v) the date on which no Advance is
or may (including by reason of reinstatement as herein provided) become
available for a Borrowing hereunder.
"TERMINATION NOTICE" means the Notice of Termination substantially
in the form of Annex V to this Agreement.
"TRANSFEREE" has the meaning assigned to such term in Section
7.08(b).
"UNAPPLIED DOWNGRADE ADVANCE" means any Downgrade Advance other than
an Applied Downgrade Advance.
"UNAPPLIED NON-EXTENSION ADVANCE" means any Non-Extension Advance
other than an Applied Non-Extension Advance.
"UNAPPLIED PROVIDER ADVANCE" means any Provider Advance other than
an Applied Provider Advance.
"UNPAID ADVANCE" has the meaning assigned to such term in Section
2.05.
(b) TERMS DEFINED IN THE INTERCREDITOR AGREEMENT. For all purposes
of this Agreement, the following terms shall have the respective meanings
assigned to such terms in the Intercreditor Agreement:
"ACCELERATION", "AIRCRAFT", "CERTIFICATES", "CLASS G-1 ABOVE-CAP LIQUIDITY
PROVIDER", "CLASS G-1 CERTIFICATES", "CLASS G-2 CASH COLLATERAL ACCOUNT",
"CLASS G-2 CERTIFICATEHOLDERS", "CLASS G-2 CERTIFICATES", "CLASS G-2
TRUST", "CLASS G-2 TRUST AGREEMENT", "CLASS G-2 TRUSTEE", "CLASS H
Certificates", "CLASS I CERTIFICATES", "CLASS J CERTIFICATES", "CLOSING
DATE", "CONTINENTAL", "CONTINENTAL BANKRUPTCY EVENT", "CONTROLLING PARTY",
"CORPORATE TRUST OFFICE", "DELIVERY PERIOD EXPIRY DATE", "DISTRIBUTION
DATE", "DOWNGRADED FACILITY", "EQUIPMENT NOTES", "FEE LETTER", "FINAL LEGAL
DISTRIBUTION DATE", "FINANCING AGREEMENT", "INDENTURE", "INVESTMENT
EARNINGS", "LIQUIDITY FACILITY", "LIQUIDITY OBLIGATIONS", "LOAN TRUSTEE",
"MOODY'S", "NON-EXTENDED FACILITY", "NOTE PURCHASE AGREEMENT", "OPERATIVE
AGREEMENTS", "PARTICIPATION AGREEMENT", "PERFORMING EQUIPMENT NOTE",
"PERSON", "POLICY", "POLICY DRAWINGS", "POLICY PROVIDER", "POLICY PROVIDER
ELECTION", "POOL BALANCE", "PRIMARY LIQUIDITY FACILITY", "RATING AGENCY",
"RATINGS CONFIRMATION", "REGULAR DISTRIBUTION DATE", "REPLACEMENT LIQUIDITY
FACILITY", "RESPONSIBLE OFFICER", "SCHEDULED PAYMENT", "SPECIAL PAYMENT",
"STANDARD & POOR'S", "STATED INTEREST RATE", "SUBORDINATION AGENT",
"TAXES", "THRESHOLD RATING", "TRANSFER", "TRUST AGREEMENTS", "TRUSTEE",
"UNDERWRITERS", "UNDERWRITING AGREEMENT", and "WRITTEN NOTICE".
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. THE ADVANCES. The Primary Liquidity Provider hereby
irrevocably agrees, on the terms and conditions hereinafter set forth, to make
Advances to the Borrower from time to time on any Business Day during the period
from the Effective Date until 1:00 p.m. (New York City time) on the Expiry Date
(unless the obligations of the Primary Liquidity Provider shall be earlier
terminated in accordance with the terms of Section 2.04(b)) in an aggregate
amount at any time outstanding not to exceed the Maximum Commitment.
Section 2.02. MAKING THE ADVANCES. (a) Interest Advances shall be
made in one or more Borrowings by delivery to the Primary Liquidity Provider of
one or more written and completed Notices of Borrowing in substantially the form
of Annex I attached hereto, signed by a Responsible Officer of the Borrower, in
an amount not exceeding the Maximum Available Commitment at such time and shall
be used solely for the payment when due of interest on the Class G-2
Certificates at the Stated Interest Rate therefor in accordance with Section
3.6(a) of the Intercreditor Agreement. Each Interest Advance made hereunder
shall automatically reduce the Maximum Available Commitment and the amount
available to be borrowed hereunder by subsequent Advances by the amount of such
Interest Advance (subject to reinstatement as provided in the next sentence).
Upon repayment to the Primary Liquidity Provider in full of the amount of any
Interest Advance made pursuant to this Section 2.02(a), together with accrued
interest thereon (as provided herein), the Maximum Available Commitment shall be
reinstated by the amount of such repaid Interest Advance, but not to exceed the
Maximum Commitment; PROVIDED, HOWEVER, that the Maximum Available Commitment
shall not be so reinstated at any time if (i) a Liquidity Event of Default shall
have occurred and be continuing and (ii) there is a Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single Borrowing if
this Agreement is not extended in accordance with Section 3.6(d) of the
Intercreditor Agreement (unless a Replacement Primary Liquidity Facility to
replace this Agreement shall have been delivered to the Borrower as contemplated
by said Section 3.6(d) within the time period specified in such Section) by
delivery to the Primary Liquidity Provider of a written and completed Notice of
Borrowing in substantially the form of Annex II attached hereto, signed by a
Responsible Officer of the Borrower, in an amount equal to the Maximum Available
Commitment at such time, and shall be used to fund the Class G-2 Cash Collateral
Account in accordance with said Section 3.6(d) and Section 3.6(f) of the
Intercreditor Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing upon the
occurrence of a Downgrade Event (as provided for in Section 3.6(c) of the
Intercreditor Agreement) unless a Replacement Primary Liquidity Facility to
replace this Agreement shall have been previously delivered to the Borrower in
accordance with said Section 3.6(c), by delivery to the Primary Liquidity
Provider of a written and completed Notice of Borrowing in substantially the
form of Annex III attached hereto, signed by a Responsible Officer of the
Borrower, in an amount equal to the Maximum Available Commitment at such time,
and shall be used to fund the Class G-2 Cash Collateral Account in accordance
with said Section 3.6(c) and Section 3.6(f) of the Intercreditor Agreement. Upon
the occurrence of a Downgrade Event, the Liquidity Provider shall promptly
deliver notice thereof to the Borrower, the Class G-2 Trustee, Continental and
the Policy Provider.
(d) A Final Advance shall be made in a single Borrowing upon the
receipt by the Borrower of a Termination Notice from the Primary Liquidity
Provider pursuant to Section 6.01 hereof by delivery to the Primary Liquidity
Provider of a written and completed Notice of Borrowing in substantially the
form of Annex IV attached hereto, signed by a Responsible Officer of the
Borrower, in an amount equal to the Maximum Available Commitment at such time,
and shall be used to fund the Class G-2 Cash Collateral Account (in accordance
with Sections 3.6(f) and 3.6(i) of the Intercreditor Agreement).
(e) Each Borrowing shall be made on notice in writing (a "NOTICE OF
BORROWING") in substantially the form required by Section 2.02(a), 2.02(b),
2.02(c) or 2.02(d), as the case may be, given by the Borrower to the Primary
Liquidity Provider. If a Notice of Borrowing is delivered by the Borrower in
respect of any Borrowing no later than 1:00 p.m. (New York City time) on a
Business Day, upon satisfaction of the conditions precedent set forth in Section
4.02 with respect to a requested Borrowing, the Primary Liquidity Provider shall
make available to the Borrower, in accordance with its payment instructions, the
amount of such Borrowing in U.S. dollars and immediately available funds, before
4:00 p.m. (New York City time) on such Business Day or on such later Business
Day specified in such Notice of Borrowing. If a Notice of Borrowing is delivered
by the Borrower in respect of any Borrowing on a day that is not a Business Day
or after 1:00 p.m. (New York City time) on a Business Day, upon satisfaction of
the conditions precedent set forth in Section 4.02 with respect to a requested
Borrowing, the Primary Liquidity Provider shall make available to the Borrower,
in accordance with its payment instructions, the amount of such Borrowing in
U.S. dollars and in immediately available funds, before 12:00 Noon (New York
City time) on the first Business Day next following the day of receipt of such
Notice of Borrowing or on such later Business Day specified by the Borrower in
such Notice of Borrowing. Payments of proceeds of a Borrowing shall be made by
wire transfer of immediately available funds to the Borrower in accordance with
such wire transfer instructions as the Borrower shall furnish from time to time
to the Primary Liquidity Provider for such purpose. Each Notice of Borrowing
shall be irrevocable and binding on the Borrower. Each Notice of Borrowing shall
be effective upon delivery of a copy thereof to the Primary Liquidity Provider's
New York Branch at the address specified in Section 7.02 hereof.
(f) Upon the making of any Advance requested pursuant to a Notice of
Borrowing, in accordance with the Borrower's payment instructions, the Primary
Liquidity Provider shall be fully discharged of its obligation hereunder with
respect to such Notice of Borrowing, and the Primary Liquidity Provider shall
not thereafter be obligated to make any further Advances hereunder in respect of
such Notice of Borrowing to the Borrower or to any other Person. If the Primary
Liquidity Provider makes an Advance requested pursuant to a Notice of Borrowing
before 12:00 Noon (New York City time) on the second Business Day after the date
of payment specified in said Section 2.02(e), the Primary Liquidity Provider
shall have fully discharged its obligations hereunder with respect to such
Advance and an event of default shall not have occurred hereunder. Following the
making of any Advance pursuant to Section 2.02(b), (c) or (d) hereof to fund the
Class G-2 Cash Collateral Account, the Primary Liquidity Provider shall have no
interest in or rights to the Class G-2 Cash Collateral Account, the funds
constituting such Advance or any other amounts from time to time on deposit in
the Class G-2 Cash Collateral Account; PROVIDED that the foregoing shall not
affect or impair the obligations of the Subordination Agent to make the
distributions contemplated by Section 3.6(e) or (f) of the Intercreditor
Agreement, and PROVIDED FURTHER, that the foregoing shall not affect or impair
the rights of the Primary Liquidity Provider to provide written instructions
with respect to the investment and reinvestment of amounts in the Cash
Collateral Accounts to the extent provided in Section 2.2(b) of the
Intercreditor Agreement. By paying to the Borrower proceeds of Advances
requested by the Borrower in accordance with the provisions of this Agreement,
the Primary Liquidity Provider makes no representation as to, and assumes no
responsibility for, the correctness or sufficiency for any purpose of the amount
of the Advances so made and requested.
Section 2.03. FEES. The Borrower agrees to pay to the Primary
Liquidity Provider the fees set forth in the Fee Letter applicable to this
Agreement.
Section 2.04. REDUCTIONS OR TERMINATION OF THE MAXIMUM COMMITMENT.
(a) AUTOMATIC REDUCTION. Promptly following each date on which the
Required Amount is reduced as a result of a reduction in the Pool Balance of the
Class G-2 Certificates (including by reason of a Policy Provider Election with
respect to one or more Series G-2 Equipment Notes) or otherwise, the Maximum
Commitment shall automatically be reduced to an amount equal to such reduced
Required Amount (as calculated by the Borrower); PROVIDED that on the first
Regular Distribution Date, the Maximum Commitment shall automatically be reduced
to the then Required Amount. The Borrower shall give notice of any such
automatic reduction of the Maximum Commitment to the Primary Liquidity Provider
within two Business Days thereof. The failure by the Borrower to furnish any
such notice shall not affect such automatic reduction of the Maximum Commitment.
(b) TERMINATION. Upon the making of any Provider Advance or Final
Advance hereunder or the occurrence of the Termination Date, the obligation of
the Primary Liquidity Provider to make further Advances hereunder shall
automatically and irrevocably terminate, and the Borrower shall not be entitled
to request any further Borrowing hereunder.
Section 2.05. REPAYMENTS OF INTEREST ADVANCES OR THE FINAL ADVANCE.
Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees,
without notice of an Advance or demand for repayment from the Primary Liquidity
Provider (which notice and demand are hereby waived by the Borrower), to pay, or
to cause to be paid, to the Primary Liquidity Provider on each date on which the
Primary Liquidity Provider shall make an Interest Advance or the Final Advance,
an amount equal to (a) the amount of such Advance (any such Advance, until
repaid, is referred to herein as an "UNPAID ADVANCE"), plus (b) interest on the
amount of each such Unpaid Advance as provided in Section 3.07 hereof; PROVIDED
that if (i) the Primary Liquidity Provider shall make a Provider Advance at any
time after making one or more Interest Advances which shall not have been repaid
in accordance with this Section 2.05 or (ii) this Liquidity Facility shall
become a Downgraded Facility or Non-Extended Facility at any time when
unreimbursed Interest Advances have reduced the Maximum Available Commitment to
zero, then such Interest Advances shall cease to constitute Unpaid Advances and
shall be deemed to have been changed into an Applied Downgrade Advance or an
Applied Non-Extension Advance, as the case may be, for all purposes of this
Agreement (including, without limitation, for the purpose of determining when
such Interest Advance is required to be repaid to the Primary Liquidity Provider
in accordance with Section 2.06 and for the purposes of Section 2.06(b)). The
Borrower and the Primary Liquidity Provider agree that the repayment in full of
each Interest Advance and Final Advance on the date such Advance is made is
intended to be a contemporaneous exchange for new value given to the Borrower by
the Primary Liquidity Provider.
Section 2.06. REPAYMENTS OF PROVIDER ADVANCES. (a) Amounts advanced
hereunder in respect of a Provider Advance shall be deposited in the Class G-2
Cash Collateral Account, invested and withdrawn from the Class G-2 Cash
Collateral Account as set forth in Sections 3.6(c), (d) and (f) of the
Intercreditor Agreement. The Borrower agrees to pay to the Primary Liquidity
Provider, on each Regular Distribution Date, commencing on the first Regular
Distribution Date after the making of a Provider Advance, interest on the
principal amount of any such Provider Advance as provided in Section 3.07;
PROVIDED, HOWEVER, that amounts in respect of a Provider Advance withdrawn from
the Class G-2 Cash Collateral Account for the purpose of paying interest on the
Class G-2 Certificates in accordance with Section 3.6(f) of the Intercreditor
Agreement (the amount of any such withdrawal being (y) in the case of a
Downgrade Advance, an "APPLIED DOWNGRADE ADVANCE" and (z) in the case of a
Non-Extension Advance, an "APPLIED NON-EXTENSION ADVANCE" and, together with an
Applied Downgrade Advance, an "APPLIED PROVIDER ADVANCE") shall thereafter
(subject to Section 2.06(b)) be treated as an Interest Advance under this
Agreement for purposes of determining the Applicable Liquidity Rate for interest
payable thereon; PROVIDED FURTHER, HOWEVER, that if, following the making of a
Provider Advance, the Primary Liquidity Provider delivers a Termination Notice
to the Borrower pursuant to Section 6.01 hereof, such Provider Advance shall
thereafter be treated as a Final Advance under this Agreement for purposes of
determining the Applicable Liquidity Rate for interest payable thereon and the
obligation for repayment thereof. Subject to Sections 2.07 and 2.09 hereof,
immediately upon the withdrawal of any amounts from the Class G-2 Cash
Collateral Account on account of a reduction in the Required Amount, the
Borrower shall repay to the Primary Liquidity Provider a portion of the Provider
Advances in a principal amount equal to such reduction, plus interest on the
principal amount prepaid as provided in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any portion
thereof) is outstanding, upon the deposit in the Class G-2 Cash Collateral
Account of any amount pursuant to clause "THIRD" of Section 2.4(b) of the
Intercreditor Agreement, clause "THIRD" of Section 3.2 of the Intercreditor
Agreement or clause "FOURTH" of Section 3.3 of the Intercreditor Agreement (any
such amount being a "REPLENISHMENT AMOUNT") for the purpose of replenishing or
increasing the balance thereof up to the Required Amount at such time, (i) the
aggregate outstanding principal amount of all Applied Provider Advances (and of
Provider Advances treated as an Interest Advance for purposes of determining the
Applicable Liquidity Rate for interest payable thereon) shall be automatically
reduced by the amount of such Replenishment Amount and (ii) the aggregate
outstanding principal amount of all Unapplied Provider Advances shall be
automatically increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Primary Liquidity Facility
in replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class G-2 Cash
Collateral Account after giving effect to any Applied Provider Advance on the
date of such replacement shall be reimbursed to the Primary Liquidity Provider,
but only to the extent such amounts are necessary to repay in full to the
Primary Liquidity Provider all amounts owing to it hereunder.
Section 2.07. PAYMENTS TO THE PRIMARY LIQUIDITY PROVIDER UNDER THE
INTERCREDITOR AGREEMENT. In order to provide for payment or repayment to the
Primary Liquidity Provider of any amounts hereunder, the Intercreditor Agreement
provides that amounts available and referred to in Articles II and III of the
Intercreditor Agreement, to the extent payable to the Primary Liquidity Provider
pursuant to the terms of the Intercreditor Agreement (including, without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Primary Liquidity Provider in accordance with the terms thereof. Amounts so paid
to the Primary Liquidity Provider shall be applied by the Primary Liquidity
Provider to Liquidity Obligations then due and payable in accordance with the
Intercreditor Agreement or, if not provided for in the Intercreditor Agreement,
then in such manner as the Primary Liquidity Provider shall deem appropriate.
Section 2.08. BOOK ENTRIES. The Primary Liquidity Provider shall
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower resulting from Advances made from time to time
and the amounts of principal and interest payable hereunder and paid from time
to time in respect thereof; PROVIDED, HOWEVER, that the failure by the Primary
Liquidity Provider to maintain such account or accounts shall not affect the
obligations of the Borrower in respect of Advances.
Section 2.09. PAYMENTS FROM AVAILABLE FUNDS ONLY. All payments to be
made by the Borrower under this Agreement shall be made only from the amounts
that constitute Scheduled Payments, Special Payments or payments under Section
8.1 of the Participation Agreements with respect to Aircraft and payments under
Section 6 of the Note Purchase Agreement and only to the extent that the
Borrower shall have sufficient income or proceeds therefrom to enable the
Borrower to make payments in accordance with the terms hereof after giving
effect to the priority of payments provisions set forth in the Intercreditor
Agreement. The Primary Liquidity Provider agrees that it will look solely to
such amounts to the extent available for distribution to it as provided in the
Intercreditor Agreement and this Agreement and that the Borrower, in its
individual capacity, is not personally liable to it for any amounts payable or
liability under this Agreement except as expressly provided in this Agreement,
the Intercreditor Agreement or any Participation Agreement. Amounts on deposit
in the Class G-2 Cash Collateral Account shall be available to the Borrower to
make payments under this Agreement only to the extent and for the purposes
expressly contemplated in Section 3.6(f) of the Intercreditor Agreement.
Section 2.10. EXTENSION OF THE EXPIRY DATE; NON-EXTENSION ADVANCE.
No earlier than the 60th day and no later than the 40th day prior to the then
effective Expiry Date (unless such Expiry Date is on or after the date that is
15 days after the Final Legal Distribution Date for the Class G-2 Certificates),
the Borrower shall request that the Primary Liquidity Provider extend the Expiry
Date to the earlier of (i) the date that is 15 days after the Final Legal
Distribution Date for the Class G-2 Certificates and (ii) the date that is the
day immediately preceding the 364th day occurring after the last day of the
Consent Period (as hereinafter defined). Whether or not the Borrower has made
such request, the Primary Liquidity Provider shall advise the Borrower and the
Policy Provider, no earlier than the 40th day (or, if earlier, the date of the
Primary Liquidity Provider's receipt of such request, if any, from the Borrower)
and no later than the 25th day prior to the then effective Expiry Date (such
period, the "CONSENT PERIOD"), whether, in its sole discretion, it agrees to so
extend the Expiry Date. If the Primary Liquidity Provider advises the Borrower
and the Policy Provider on or before the date on which the Consent Period ends
that such Expiry Date shall not be so extended, or fails to irrevocably and
unconditionally advise the Borrower on or before the date on which the Consent
Period ends that such Expiry Date shall be so extended (and, in each case, if
the Primary Liquidity Provider shall not have been replaced in accordance with
Section 3.6(e) of the Intercreditor Agreement), the Borrower shall be entitled
on and after the date on which the Consent Period ends (but prior to the then
effective Expiry Date) to request a Non-Extension Advance in accordance with
Section 2.02(b) hereof and Section 3.6(d) of the Intercreditor Agreement.
Section 2.11 RIGHT TO FURTHER EXTEND EXPIRY DATE. Subject to the
proviso in the immediately succeeding sentence, the Primary Liquidity Provider
shall have the right at any time and without the consent of the Borrower to
extend the then effective Expiry Date to the date that is 15 days after the
Final Legal Distribution Date for the Class G-2 Certificates by giving not less
than five nor more than ten days' prior written notice of such extension to the
Borrower, the Class G-2 Trustee and Continental (which notice shall specify the
effective date of such extension (the "EXTENSION EFFECTIVE DATE")). On the
Extension Effective Date, the then effective Expiry Date shall be so extended
without any further act; PROVIDED, HOWEVER, that if prior to the Extension
Effective Date a Downgrade Event shall have occurred, the then effective Expiry
Date shall not be so extended.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01. INCREASED COSTS. The Borrower shall pay to the Primary
Liquidity Provider from time to time such amounts as may be necessary to
compensate the Primary Liquidity Provider for any increased costs incurred by
the Primary Liquidity Provider which are attributable to its making or
maintaining any LIBOR Advances hereunder or its obligation to make any such
Advances hereunder, or any reduction in any amount receivable by the Primary
Liquidity Provider under this Agreement or the Intercreditor Agreement in
respect of any such Advances or such obligation (such increases in costs and
reductions in amounts receivable being herein called "ADDITIONAL COSTS"),
resulting from any change after the date of this Agreement in U.S. federal,
state, municipal, or foreign laws or regulations (including Regulation D of the
Board of Governors of the Federal Reserve System), or the adoption or making
after the date of this Agreement of any interpretations, directives, or
requirements applying to a class of banks including the Primary Liquidity
Provider under any U.S. federal, state, municipal, or any foreign laws or
regulations (whether or not having the force of law) by any court, central bank
or monetary authority charged with the interpretation or administration thereof
(a "REGULATORY CHANGE"), which: (1) changes the basis of taxation of any amounts
payable to the Primary Liquidity Provider under this Agreement in respect of any
such Advances or such obligation (other than Excluded Taxes); or (2) imposes or
modifies any reserve, special deposit, compulsory loan or similar requirements
relating to any extensions of credit or other assets of, or any deposits with
other liabilities of, the Primary Liquidity Provider (including any such
Advances or such obligation or any deposits referred to in the definition of
LIBOR Rate or related definitions). The Primary Liquidity Provider agrees to use
reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making such
change would avoid the need for, or reduce the amount of, any amount payable
under this Section that may thereafter accrue and would not, in the reasonable
judgment of the Primary Liquidity Provider, be otherwise disadvantageous to the
Primary Liquidity Provider.
The Primary Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Primary
Liquidity Provider to compensation pursuant to this Section 3.01 as promptly as
practicable after it obtains knowledge thereof and determines to request such
compensation, which notice shall describe in reasonable detail the calculation
of the amounts owed under this Section. Determinations by the Primary Liquidity
Provider for purposes of this Section 3.01 of the effect of any Regulatory
Change on its costs of making or maintaining Advances or on amounts receivable
by it in respect of Advances, and of the additional amounts required to
compensate the Primary Liquidity Provider in respect of any Additional Costs,
shall be prima facie evidence of the amount owed under this Section.
Notwithstanding the preceding two paragraphs, the Primary Liquidity
Provider and the Subordination Agent agree that any permitted assignee or
participant of the initial Primary Liquidity Provider which is not a bank shall
not be entitled to the benefits of the preceding two paragraphs (but without
limiting the provisions of Section 7.08 hereof).
Section 3.02. CAPITAL ADEQUACY. If (1) the adoption, after the date
hereof, of any applicable governmental law, rule or regulation regarding capital
adequacy, (2) any change, after the date hereof, in the interpretation or
administration of any such law, rule or regulation by any central bank or other
governmental authority charged with the interpretation or administration thereof
or (3) compliance by the Primary Liquidity Provider or any corporation
controlling the Primary Liquidity Provider with any applicable guideline or
request of general applicability, issued after the date hereof, by any central
bank or other governmental authority (whether or not having the force of law)
that constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital required to be maintained by
the Primary Liquidity Provider or any corporation controlling the Primary
Liquidity Provider, and such increase is based upon the Primary Liquidity
Provider's obligations hereunder and other similar obligations, the Borrower
shall, subject to the provisions of the next paragraph, pay to the Primary
Liquidity Provider from time to time such additional amount or amounts as are
necessary to compensate the Primary Liquidity Provider for such portion of such
increase as shall be reasonably allocable to the Primary Liquidity Provider's
obligations to the Borrower hereunder. The Primary Liquidity Provider agrees to
use reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making such
change would avoid the need for, or reduce the amount of, any amount payable
under this Section that may thereafter accrue and would not, in the reasonable
judgment of the Primary Liquidity Provider, be otherwise materially
disadvantageous to the Primary Liquidity Provider.
From and after the Extension Effective Date and prior to the
occurrence of a Helaba Downgrade, the Primary Liquidity Provider will be
entitled to compensation pursuant to this Section 3.02 only to the extent that
the Primary Liquidity Provider would have been so entitled if the Extension
Effective Date had not occurred. From and after the Extension Effective Date and
after the occurrence of a Helaba Downgrade, the Primary Liquidity Provider will
be entitled to compensation pursuant to this Section 3.02 only to the extent
that the Primary Liquidity Provider would have been so entitled had the Primary
Liquidity Provider made a Downgrade Advance upon the occurrence of such Helaba
Downgrade.
The Primary Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Primary
Liquidity Provider to compensation pursuant to this Section 3.02 as promptly as
practicable after it obtains knowledge thereof and determines to request such
compensation, which notice shall describe in reasonable detail the calculation
of the amounts owed under this Section. Determinations by the Primary Liquidity
Provider for purposes of this Section 3.02 of the effect of any increase in the
amount of capital required to be maintained by the Primary Liquidity Provider
and of the amount allocable to the Primary Liquidity Provider's obligations to
the Borrower hereunder shall be prima facie evidence of the amounts owed under
this Section.
Notwithstanding the preceding three paragraphs, the Primary
Liquidity Provider and the Subordination Agent agree that any permitted assignee
or participant of the initial Primary Liquidity Provider which is not a bank
shall not be entitled to the benefits of the preceding two paragraphs (but
without limiting the provisions of Section 7.08 hereof).
Section 3.03. PAYMENTS FREE OF DEDUCTIONS. (a) All payments made by
the Borrower under this Agreement shall be made free and clear of, and without
reduction for or on account of, any present or future stamp or other taxes,
levies, imposts, duties, charges, fees, deductions, withholdings, restrictions
or conditions of any nature whatsoever now or hereafter imposed, levied,
collected, withheld or assessed, excluding Excluded Taxes (such non-excluded
taxes being referred to herein, collectively, as "NON-EXCLUDED TAXES" and each,
individually, as a "NON-EXCLUDED TAX"). If any Non-Excluded Taxes are required
to be withheld from any amounts payable to the Primary Liquidity Provider under
this Agreement, (i) the Borrower shall within the time prescribed therefor by
applicable law pay to the appropriate governmental or taxing authority the full
amount of any such Non-Excluded Taxes (and any additional Non-Excluded Taxes in
respect of the additional amounts payable under clause (ii) hereof) and make
such reports or returns in connection therewith at the time or times and in the
manner prescribed by applicable law, and (ii) the amounts so payable to the
Primary Liquidity Provider shall be increased to the extent necessary to yield
to the Primary Liquidity Provider (after payment of all Non-Excluded Taxes)
interest or any other such amounts payable under this Agreement at the rates or
in the amounts specified in this Agreement. The Primary Liquidity Provider
agrees to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to change the jurisdiction of its Facility Office
if making such change would avoid the need for, or reduce the amount of, any
such additional amounts that may thereafter accrue and would not, in the
reasonable judgment of the Primary Liquidity Provider, be otherwise
disadvantageous to the Primary Liquidity Provider. From time to time upon the
reasonable request of the Borrower, the Primary Liquidity Provider agrees to
provide to the Borrower two original Internal Revenue Service Form W-8BEN or
W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that the Primary Liquidity Provider is
exempt from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement. Within 30 days after the date of each
payment hereunder, the Borrower shall furnish to the Primary Liquidity Provider
the original or a certified copy of (or other documentary evidence of) the
payment of the Non-Excluded Taxes applicable to such payment.
(b) All payments (including, without limitation, Advances) made by
the Primary Liquidity Provider under this Agreement shall be made free and clear
of, and without reduction for or on account of, any Taxes. If any Taxes are
required to be withheld or deducted from any amounts payable to the Borrower
under this Agreement, the Primary Liquidity Provider shall (i) within the time
prescribed therefor by applicable law pay to the appropriate governmental or
taxing authority the full amount of any such Taxes (and any additional Taxes in
respect of the additional amounts payable under clause (ii) hereof) and make
such reports or returns in connection therewith at the time or times and in the
manner prescribed by applicable law, and (ii) pay to the Borrower an additional
amount which (after deduction of all such Taxes) will be sufficient to yield to
the Borrower the full amount which would have been received by it had no such
withholding or deduction been made. Within 30 days after the date of each
payment hereunder, the Primary Liquidity Provider shall furnish to the Borrower
the original or a certified copy of (or other documentary evidence of) the
payment of the Taxes applicable to such payment.
(c) If any exemption from, or reduction in the rate of, any Taxes is
reasonably available to the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) tax, the Borrower
shall deliver to the Primary Liquidity Provider such form or forms and such
other evidence of the eligibility of the Borrower for such exemption or
reduction as the Primary Liquidity Provider may reasonably identify to the
Borrower as being required as a condition to exemption from, or reduction in the
rate of, any Taxes.
Section 3.04. PAYMENTS. The Borrower shall make or cause to be made
each payment to the Primary Liquidity Provider under this Agreement so as to
cause the same to be received by the Primary Liquidity Provider not later than
1:00 P.M. (New York City time) on the day when due. The Borrower shall make all
such payments in lawful money of the United States of America, to the Primary
Liquidity Provider in immediately available funds, by wire transfer to Citibank
N.A., New York/ABA 021000089 in favor of account number 10920118, reference
Continental Airlines Trust 2002-1G-2 #4244133, MT215000, attn. M. Kirr.
Section 3.05. COMPUTATIONS. All computations of interest based on
the Base Rate shall be made on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the LIBOR Rate shall be
made on the basis of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest is payable.
Section 3.06. PAYMENT ON NON-BUSINESS DAYS. Whenever any payment to
be made hereunder shall be stated to be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made, shall be deemed to have been
made when due). If any payment in respect of interest on an Advance is so
deferred to the next succeeding Business Day, such deferral shall not delay the
commencement of the next Interest Period for such Advance (if such Advance is a
LIBOR Advance) or reduce the number of days for which interest will be payable
on such Advance on the next interest payment date for such Advance.
Section 3.07. INTEREST. (a) Subject to Section 2.09, the Borrower
shall pay, or shall cause to be paid, without duplication, interest on (i) the
unpaid principal amount of each Advance from and including the date of such
Advance (or, in the case of an Applied Provider Advance, from and including the
date on which the amount thereof was withdrawn from the Class G-2 Cash
Collateral Account to pay interest on the Class G-2 Certificates) to but
excluding the date such principal amount shall be paid in full (or, in the case
of an Applied Provider Advance, the date on which the Class G-2 Cash Collateral
Account is fully replenished in respect of such Advance) and (ii) any other
amount due hereunder (whether fees, commissions, expenses or other amounts or,
to the extent permitted by law, installments of interest on Advances or any such
other amount) which is not paid when due (whether at stated maturity, by
acceleration or otherwise) from and including the due date thereof to but
excluding the date such amount is paid in full, in each such case, at a
fluctuating interest rate per annum for each day equal to the Applicable
Liquidity Rate (as defined below) for such Advance or such other amount as in
effect for such day, but in no event at a rate per annum greater than the
maximum rate permitted by applicable law; PROVIDED, HOWEVER, that, if at any
time the otherwise applicable interest rate as set forth in this Section 3.07
shall exceed the maximum rate permitted by applicable law, then any subsequent
reduction in such interest rate will not reduce the rate of interest payable
pursuant to this Section 3.07 below the maximum rate permitted by applicable law
until the total amount of interest accrued equals the amount of interest that
would have accrued if such otherwise applicable interest rate as set forth in
this Section 3.07 had at all times been in effect.
(b) Except as provided in clause (e) below, each Advance (including,
without limitation, each outstanding Unapplied Downgrade Advance) will be either
a Base Rate Advance or a LIBOR Advance as provided in this Section. Each such
Advance will be a Base Rate Advance for the period from the date of its
borrowing to (but excluding) the third Business Day following the Primary
Liquidity Provider's receipt of the Notice of Borrowing for such Advance.
Thereafter, such Advance shall be a LIBOR Advance; provided that the Borrower
(at the direction of the Controlling Party, so long as the Primary Liquidity
Provider is not the Controlling Party) may (x) convert the Final Advance into a
Base Rate Advance on the last day of an Interest Period for such Advance by
giving the Primary Liquidity Provider no less than four Business Days' prior
written notice of such election or (y) elect to maintain the Final Advance as a
Base Rate Advance by not requesting a conversion of the Final Advance to a LIBOR
Advance under Clause (5) of the applicable Notice of Borrowing (or, if such
Final Advance is deemed to have been made, without delivery of a Notice of
Borrowing pursuant to Section 2.06, by requesting, prior to 11:00 A.M. (New York
City time) on the first Business Day immediately following the Borrower's
receipt of the applicable Termination Notice, that such Final Advance not be
converted from a Base Rate Advance to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each Interest
Period at a rate per annum equal to the LIBOR Rate for such Interest Period plus
the Applicable Margin for such LIBOR Advance, payable in arrears on the last day
of such Interest Period and, in the event of the payment of principal of such
LIBOR Advance on a day other than such last day, on the date of such payment (to
the extent of interest accrued on the amount of principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin for such Base Rate Advance,
payable in arrears on each Regular Distribution Date and, in the event of the
payment of principal of such Base Rate Advance on a day other than a Regular
Distribution Date, on the date of such payment (to the extent of interest
accrued on the amount of principal repaid).
(e) Each outstanding Unapplied Non-Extension Advance shall bear
interest in an amount equal to the Investment Earnings on amounts on deposit in
the Class G-2 Cash Collateral Account plus the Applicable Margin for such
Unapplied Non-Extension Advance on the amount of such Unapplied Non-Extension
Advance from time to time, payable in arrears on each Regular Distribution Date.
(f) Each amount not paid when due hereunder (whether fees,
commissions, expenses or other amounts or, to the extent permitted by applicable
law, installments of interest on Advances but excluding Advances) shall bear
interest at a rate per annum equal to the Base Rate plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective immediately.
The rates of interest specified in this Section 3.07 with respect to any Advance
or other amount shall be referred to as the "APPLICABLE LIQUIDITY RATE".
Section 3.08. REPLACEMENT OF BORROWER. From time to time and subject
to the successor Borrower's meeting the eligibility requirements set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination
Agent, upon the effective date and time specified in a written and completed
Notice of Replacement Subordination Agent in substantially the form of Annex VI
attached hereto (a "NOTICE OF REPLACEMENT SUBORDINATION AGENT") delivered to the
Primary Liquidity Provider by the then Borrower, the successor Borrower
designated therein shall be substituted for as the Borrower for all purposes
hereunder.
Section 3.09. FUNDING LOSS INDEMNIFICATION. The Borrower shall pay
to the Primary Liquidity Provider, upon the request of the Primary Liquidity
Provider, such amount or amounts as shall be sufficient (in the reasonable
opinion of the Primary Liquidity Provider) to compensate it for any loss, cost,
or expense incurred by reason of the liquidation or redeployment of deposits or
other funds acquired by the Primary Liquidity Provider to fund or maintain any
LIBOR Advance (but excluding loss of anticipated profits) incurred as a result
of:
(1) Any repayment of a LIBOR Advance on a date other than the last
day of the Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on the
date for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. ILLEGALITY. Notwithstanding any other provision in
this Agreement, if any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Primary Liquidity Provider (or its
Facility Office) with any request or directive (whether or not having the force
of law) of any such authority, central bank or comparable agency shall make it
unlawful or impossible for the Primary Liquidity Provider (or its Facility
Office) to maintain or fund its LIBOR Advances, then upon notice to the Borrower
by the Primary Liquidity Provider, the outstanding principal amount of the LIBOR
Advances shall be converted to Base Rate Advances (a) immediately upon demand of
the Primary Liquidity Provider, if such change or compliance with such request,
in the judgment of the Primary Liquidity Provider, requires immediate repayment;
or (b) at the expiration of the last Interest Period to expire before the
effective date of any such change or request. The Primary Liquidity Provider
agrees to use reasonable efforts (consistent with applicable legal and
regulatory restrictions) to change the jurisdiction of its Facility Office if
making such change would avoid or cure the aforesaid illegality and would not,
in the reasonable judgment of the Primary Liquidity Provider, be otherwise
disadvantageous to the Primary Liquidity Provider.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION 2.01.
Section 2.01 of this Agreement shall become effective on and as of the first
date (the "EFFECTIVE DATE") on which the following conditions precedent have
been satisfied or waived:
(a) The Primary Liquidity Provider shall have received each of the
following, and in the case of each document delivered pursuant to
paragraphs (i), (ii) and (iii), each in form and substance satisfactory to
the Primary Liquidity Provider:
(i) This Agreement duly executed on behalf of the Borrower,
the Fee Letter applicable to this Agreement duly executed on behalf
of the Borrower and the Tax Letter duly executed on behalf of
Continental;
(ii) The Intercreditor Agreement duly executed on behalf of
each of the parties thereto (other than the Primary Liquidity
Provider);
(iii) Fully executed copies of each of the Operative
Agreements executed and delivered on the Closing Date (other than
this Agreement, the Fee Letter applicable to this Agreement, the Tax
Letter and the Intercreditor Agreement);
(iv) A copy of the Prospectus Supplement and specimen copies
of the Class G-2 Certificates;
(v) An executed copy of each document, instrument, certificate
and opinion delivered on the Closing Date pursuant to the Class G-2
Trust Agreement, the Intercreditor Agreement and the other Operative
Agreements (in the case of each such opinion, other than the opinion
of counsel for the Underwriters, either addressed to the Primary
Liquidity Provider or accompanied by a letter from the counsel
rendering such opinion to the effect that the Primary Liquidity
Provider is entitled to rely on such opinion as of its date as if it
were addressed to the Primary Liquidity Provider);
(vi) Evidence that there shall have been made and shall be in
full force and effect, all filings, recordings and/or registrations,
and there shall have been given or taken any notice or other similar
action as may be reasonably necessary or, to the extent reasonably
requested by the Primary Liquidity Provider, reasonably advisable,
in order to establish, perfect, protect and preserve the right,
title and interest, remedies, powers, privileges, liens and security
interests of, or for the benefit of, the Trustees, the Borrower and
the Primary Liquidity Provider created by the Operative Agreements
executed and delivered on the Closing Date;
(vii) An agreement from Continental, pursuant to which (i)
Continental agrees to provide to the Primary Liquidity Provider (A)
within 90 days after the end of each of the first three fiscal
quarters in each fiscal year of Continental, a consolidated balance
sheet of Continental as of the end of such quarter and related
statements of income and cash flows for the period commencing at the
end of the previous fiscal year and ending with the end of such
quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding period in the preceding
fiscal year, prepared in accordance with GAAP; PROVIDED, that so
long as Continental is subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended, a copy of Continental's
report on Form 10-Q for such fiscal quarter (excluding exhibits) or
a written notice executed by an authorized officer of Continental
that such report has been filed with the Securities and Exchange
Commission, providing a website address at which such report may be
accessed and confirming that the report accessible at such website
address conforms to the original report filed with the Securities
and Exchange Commission will satisfy this subclause (A), and (B)
within 120 days after the end of each fiscal year of Continental, a
consolidated balance sheet of Continental as of the end of such
fiscal year and related statements of income and cash flows of
Continental for such fiscal year, in comparative form with the
preceding fiscal year, prepared in accordance with GAAP, together
with a report of Continental's independent certified public
accountants with respect to their audit of such financial
statements; PROVIDED, that so long as Continental is subject to the
reporting requirements of the Securities Exchange Act of 1934, as
amended, a copy of Continental's report on Form 10-K for such fiscal
year (excluding exhibits) or a written notice executed by an
authorized officer of Continental that such report has been filed
with the Securities and Exchange Commission, providing a website
address at which such report may be accessed and confirming that the
report accessible at such website address conforms to the original
report filed with the Securities and Exchange Commission will
satisfy this subclause (B), and (ii) Continental agrees to allow the
Primary Liquidity Provider to inspect Continental's books and
records regarding such transactions, and to discuss such
transactions with officers and employees of Continental; and
(viii) Such other documents, instruments, opinions and
approvals pertaining to the transactions contemplated hereby or by
the other Operative Agreements as the Primary Liquidity Provider
shall have reasonably requested.
(b) The following statement shall be true on and as of the Effective
Date: no event has occurred and is continuing, or would result from the
entering into of this Agreement or the making of any Advance, which
constitutes a Liquidity Event of Default.
(c) The Primary Liquidity Provider shall have received payment in
full of all fees and other sums required to be paid to or for the account
of the Primary Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the Certificates
under the Trust Agreements shall have been satisfied or waived, and all
conditions precedent to the purchase of the Class G-1 Certificates and
Class G-2 Certificates by the Underwriters under the Underwriting
Agreement shall have been satisfied or waived.
(e) The Borrower shall have received a certificate, dated the date
hereof, signed by a duly authorized representative of the Primary
Liquidity Provider, certifying that all conditions precedent to the
effectiveness of Section 2.01 have been satisfied or waived
Section 4.02. CONDITIONS PRECEDENT TO BORROWING. The obligation of
the Primary Liquidity Provider to make an Advance on the occasion of each
Borrowing shall be subject to the conditions precedent that the Effective Date
shall have occurred and, on or prior to the date of such Borrowing, the Borrower
shall have delivered a Notice of Borrowing which conforms to the terms and
conditions of this Agreement and has been completed as may be required by the
relevant form of the Notice of Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. AFFIRMATIVE COVENANTS OF THE BORROWER. So long as any
Advance shall remain unpaid or the Primary Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to pay
any amount to the Primary Liquidity Provider hereunder, the Borrower will,
unless the Primary Liquidity Provider shall otherwise consent in writing:
(a) PERFORMANCE OF THIS AND OTHER AGREEMENTS. Punctually pay or
cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material
respects the conditions, covenants and requirements applicable to it
contained in this Agreement and the other Operative Agreements.
(b) REPORTING REQUIREMENTS. Furnish to the Primary Liquidity
Provider with reasonable promptness, such other information and data with
respect to the transactions contemplated by the Operative Agreements as
from time to time may be reasonably requested by the Primary Liquidity
Provider; and permit the Primary Liquidity Provider, upon reasonable
notice, to inspect the Borrower's books and records with respect to such
transactions and to meet with officers and employees of the Borrower to
discuss such transactions.
(c) CERTAIN OPERATIVE AGREEMENTS. Furnish to the Primary Liquidity
Provider with reasonable promptness, such Operative Agreements entered
into after the date hereof as from time to time may be reasonably
requested by the Primary Liquidity Provider.
Section 5.02. NEGATIVE COVENANTS OF THE BORROWER. So long as any
Advance shall remain unpaid or the Primary Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to pay
any amount to the Primary Liquidity Provider hereunder, the Borrower will not
appoint or permit or suffer to be appointed any successor Borrower without the
prior written consent of the Primary Liquidity Provider, which consent shall not
be unreasonably withheld or delayed.
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. LIQUIDITY EVENTS OF DEFAULT. If (a) any Liquidity
Event of Default has occurred and is continuing and (b) there is a Performing
Note Deficiency, the Primary Liquidity Provider may, in its discretion, deliver
to the Borrower a Termination Notice, the effect of which shall be to cause (i)
the obligation of the Primary Liquidity Provider to make Advances hereunder to
expire on the fifth Business Day after the date on which such Termination Notice
is received by the Borrower, (ii) the Borrower to promptly request, and the
Primary Liquidity Provider to promptly make, a Final Advance in accordance with
Section 2.02(d) hereof and Section 3.6(i) of the Intercreditor Agreement, (iii)
all other outstanding Advances to be automatically converted into Final Advances
for purposes of determining the Applicable Liquidity Rate for interest payable
thereon, and (iv) subject to Sections 2.07 and 2.09 hereof, all Advances
(including, without limitation, any Provider Advance and Applied Provider
Advance), any accrued interest thereon and any other amounts outstanding
hereunder to become immediately due and payable to the Primary Liquidity
Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Primary Liquidity Provider, and, in the case of an amendment
or of a waiver by the Borrower, the Borrower, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
Section 7.02. NOTICES, ETC. Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):
Borrower: WILMINGTON TRUST COMPANY
Rodney Square North
1100 North Market Square
Wilmington, DE 19890-1605
Attention: Corporate Capital Market Services
Telephone: (302) 636-6296
Telecopy: (302) 636-4140
Primary Liquidity LANDESBANK HESSEN-THURINGEN
Provider: GIROZENTRALE
Main Tower
Neue Mainzer Str. 52 - 58
60311 Frankfurt am Main
Germany
Attention: Asset Finance
Telephone: 49-69-9132-4882
Telecopy: 49-69-9132-4392
with a copy of any Notice of Borrowing to:
LANDESBANK HESSEN-THURINGEN
420 Fifth Avenue, 24th Floor
New York, NY 10018
Attention: Project Finance/Michael Novack
Telephone: (212) 703-5224
Telecopy: (212) 703-5256
or, as to each of the foregoing, at such other address as shall be designated by
such Person in a written notice to the others. All such notices and
communications shall be effective (i) if given by telecopier, when transmitted
to the telecopier number specified above, (ii) if given by mail, when deposited
in the mails addressed as specified above, and (iii) if given by other means,
when delivered at the address specified above, except that written notices to
the Primary Liquidity Provider pursuant to the provisions of Article II and
Article III hereof shall not be effective until received by the Primary
Liquidity Provider. A copy of all notices delivered hereunder to either party
shall in addition be delivered to each of the parties to the Participation
Agreements at their respective addresses set forth therein.
Section 7.03. NO WAIVER; REMEDIES. No failure on the part of the
Primary Liquidity Provider to exercise, and no delay in exercising, any right
under this Agreement shall operate as a waiver thereof; nor shall any single or
partial exercise of any right under this Agreement preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 7.04. FURTHER ASSURANCES. The Borrower agrees to do such
further acts and things and to execute and deliver to the Primary Liquidity
Provider such additional assignments, agreements, powers and instruments as the
Primary Liquidity Provider may reasonably require or deem advisable to carry
into effect the purposes of this Agreement and the other Operative Agreements or
to better assure and confirm unto the Primary Liquidity Provider its rights,
powers and remedies hereunder and under the other Operative Agreements.
Section 7.05. INDEMNIFICATION; SURVIVAL OF CERTAIN PROVISIONS. The
Primary Liquidity Provider shall be indemnified hereunder to the extent and in
the manner described in Section 8.1 of the Participation Agreements with respect
to Aircraft. In addition, the Borrower agrees to indemnify, protect, defend and
hold harmless the Primary Liquidity Provider from, against and in respect of,
and shall pay on demand, all Expenses of any kind or nature whatsoever (other
than any Expenses of the nature described in Section 3.01, 3.02 or 7.07 hereof
or in the Fee Letter applicable to this Agreement (regardless of whether
indemnified against pursuant to said Sections or in such Fee Letter)), that may
be imposed, incurred by or asserted against any Liquidity Indemnitee, in any way
relating to, resulting from, or arising out of or in connection with any action,
suit or proceeding by any third party against such Liquidity Indemnitee and
relating to this Agreement, the Fee Letter applicable to this Agreement, the
Intercreditor Agreement or any Financing Agreement; PROVIDED, HOWEVER, that the
Borrower shall not be required to indemnify, protect, defend and hold harmless
any Liquidity Indemnitee in respect of any Expense of such Liquidity Indemnitee
to the extent such Expense is (i) attributable to the gross negligence or
willful misconduct of such Liquidity Indemnitee or any other Liquidity
Indemnitee, (ii) ordinary and usual operating overhead expense, or (iii)
attributable to the failure by such Liquidity Indemnitee or any other Liquidity
Indemnitee to perform or observe any agreement, covenant or condition on its
part to be performed or observed in this Agreement, the Intercreditor Agreement,
the Fee Letter applicable to this Agreement, the Tax Letter or any other
Operative Agreement to which it is a party. The indemnities contained in Section
8.1 of the Participation Agreements, and the provisions of Sections 3.01, 3.02,
3.03, 3.09, 7.05 and 7.07 hereof, shall survive the termination of this
Agreement.
Section 7.06. LIABILITY OF THE PRIMARY LIQUIDITY PROVIDER. (a)
Neither the Primary Liquidity Provider nor any of its officers, employees,
directors or Affiliates shall be liable or responsible for: (i) the use which
may be made of the Advances or any acts or omissions of the Borrower or any
beneficiary or transferee in connection therewith; (ii) the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; or (iii) the making of Advances by the Primary Liquidity
Provider against delivery of a Notice of Borrowing and other documents which do
not comply with the terms hereof; PROVIDED, HOWEVER, that the Borrower shall
have a claim against the Primary Liquidity Provider, and the Primary Liquidity
Provider shall be liable to the Borrower, to the extent of any damages suffered
by the Borrower which were the result of (A) the Primary Liquidity Provider's
willful misconduct or negligence in determining whether documents presented
hereunder comply with the terms hereof, or (B) any breach by the Primary
Liquidity Provider of any of the terms of this Agreement, including, but not
limited to, the Primary Liquidity Provider's failure to make lawful payment
hereunder after the delivery to it by the Borrower of a Notice of Borrowing
strictly complying with the terms and conditions hereof.
(b) Neither the Primary Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible in any respect
for (i) any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with this
Agreement or any Notice of Borrowing delivered hereunder, or (ii) any action,
inaction or omission which may be taken by it in good faith, absent willful
misconduct or negligence (in which event the extent of the Primary Liquidity
Provider's potential liability to the Borrower shall be limited as set forth in
the immediately preceding paragraph), in connection with this Agreement or any
Notice of Borrowing.
Section 7.07. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay,
or cause to be paid (A) on the Effective Date and on such later date or dates on
which the Primary Liquidity Provider shall make demand, all reasonable
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of outside counsel for the Primary Liquidity Provider) of the
Primary Liquidity Provider in connection with the preparation, negotiation,
execution, delivery, filing and recording of this Agreement, any other Operative
Agreement and any other documents which may be delivered in connection with this
Agreement and (B) on demand, all reasonable costs and expenses (including
reasonable counsel fees and expenses) of the Primary Liquidity Provider in
connection with (i) the enforcement of this Agreement or any other Operative
Agreement, (ii) the modification or amendment of, or supplement to, this
Agreement or any other Operative Agreement or such other documents which may be
delivered in connection herewith or therewith (whether or not the same shall
become effective) or (iii) any action or proceeding relating to any order,
injunction, or other process or decree restraining or seeking to restrain the
Primary Liquidity Provider from paying any amount under this Agreement, the
Intercreditor Agreement or any other Operative Agreement or otherwise affecting
the application of funds in the Class G-2 Cash Collateral Account. In addition,
the Borrower shall pay any and all recording, stamp and other similar taxes and
fees payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, any other Operative Agreement
and such other documents, and agrees to save the Primary Liquidity Provider
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes or fees.
Section 7.08. BINDING EFFECT; PARTICIPATIONS. (a) This Agreement
shall be binding upon and inure to the benefit of the Borrower and the Primary
Liquidity Provider and their respective successors and assigns, except that
neither the Primary Liquidity Provider (except as otherwise provided in this
Section 7.08) nor (except as contemplated by Section 3.08) the Borrower shall
have the right to assign its rights or obligations hereunder or any interest
herein without the prior written consent of the other party, subject to the
requirements of Section 7.08(b). The Primary Liquidity Provider may grant
participations herein or in any of its rights hereunder (including, without
limitation, funded participations and participations in rights to receive
interest payments hereunder) and under the other Operative Agreements to such
Persons (other than Continental and its Affiliates) as the Primary Liquidity
Provider may in its sole discretion select, subject to the requirements of
Section 7.08(b). No such granting of participations by the Primary Liquidity
Provider, however, will relieve the Primary Liquidity Provider of its
obligations hereunder. In connection with any participation or any proposed
participation, the Primary Liquidity Provider may disclose to the participant or
the proposed participant any information that the Borrower is required to
deliver or to disclose to the Primary Liquidity Provider pursuant to this
Agreement. The Borrower acknowledges and agrees that the Primary Liquidity
Provider's source of funds may derive in part from its participants.
Accordingly, references in this Agreement and the other Operative Agreements to
determinations, reserve and capital adequacy requirements, increased costs,
reduced receipts, additional amounts due pursuant to Section 3.03 and the like
as they pertain to the Primary Liquidity Provider shall be deemed also to
include those of each of its participants that are banks (subject, in each case,
to the maximum amount that would have been incurred by or attributable to the
Primary Liquidity Provider directly if the Primary Liquidity Provider, rather
than the participant, had held the interest participated).
(b) If, pursuant to subsection (a) above, the Primary Liquidity
Provider sells any participation in this Agreement to any bank or other entity
(each, a "TRANSFEREE"), then, concurrently with the effectiveness of such
participation, the Transferee shall (i) represent to the Primary Liquidity
Provider (for the benefit of the Primary Liquidity Provider and the Borrower)
either (A) that it is incorporated under the laws of the United States or a
state thereof or (B) that under applicable law and treaties, no taxes will be
required to be withheld with respect to any payments to be made to such
Transferee in respect of this Agreement, (ii) furnish to the Primary Liquidity
Provider and the Borrower either (x) a statement that it is incorporated under
the laws of the United States or a state thereof or (y) if it is not so
incorporated, two copies of a properly completed United States Internal Revenue
Service Form W-8ECI or Form W-8BEN, as appropriate, or other applicable form,
certificate or document prescribed by the Internal Revenue Service certifying,
in each case, such Transferee's entitlement to a complete exemption from United
States federal withholding tax in respect to any and all payments to be made
hereunder, and (iii) agree (for the benefit of the Primary Liquidity Provider
and the Borrower) to provide the Primary Liquidity Provider and the Borrower a
new Form W-8ECI or Form W-8BEN, as appropriate, (A) on or before the date that
any such form expires or becomes obsolete or (B) after the occurrence of any
event requiring a change in the most recent form previously delivered by it and
prior to the immediately following due date of any payment by the Borrower
hereunder, certifying in the case of a Form W-8BEN or Form W-8ECI that such
Transferee is entitled to a complete exemption from United States federal
withholding tax on payments under this Agreement. Unless the Borrower has
received forms or other documents reasonably satisfactory to it (and required by
applicable law) indicating that payments hereunder are not subject to United
States federal withholding tax, the Borrower will withhold taxes as required by
law from such payments at the applicable statutory rate.
(c) Notwithstanding the other provisions of this Section 7.08, the
Primary Liquidity Provider may assign and pledge all or any portion of the
Advances owing to it to any Federal Reserve Bank or the United States Treasury
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank, provided that any payment in respect of such assigned Advances made by the
Borrower to the Primary Liquidity Provider in accordance with the terms of this
Agreement shall satisfy the Borrower's obligations hereunder in respect of such
assigned Advance to the extent of such payment. No such assignment shall release
the Primary Liquidity Provider from its obligations hereunder.
Section 7.09. Third Party Beneficiary. The Policy Provider is an
intended third party beneficiary with respect to the provisions of Sections
2.02(c) and 2.10 of this Agreement.
Section 7.10. SEVERABILITY. Any provision of this Agreement which is
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction.
Section 7.11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Section 7.12. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
WAIVER OF IMMUNITY. (a) Each of the parties hereto hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Operative Agreement, or
for recognition and enforcement of any judgment in respect hereof or
thereof, to the nonexclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the
Southern District of New York, and the appellate courts from any thereof;
(ii) consents that any such action or proceeding may be brought in
such courts, and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to each party hereto at its address set forth in Section 7.02
hereof, or at such other address of which the Primary Liquidity Provider
shall have been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction.
(b) THE BORROWER AND THE PRIMARY LIQUIDITY PROVIDER EACH HEREBY
AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS
BEING ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. The
Borrower and the Primary Liquidity Provider each warrant and represent that it
has reviewed this waiver with its legal counsel, and that it knowingly and
voluntarily waives its jury trial rights following consultation with such legal
counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(c) The Primary Liquidity Provider hereby waives any immunity it may
have from the jurisdiction of the courts of the United States or of any State
and waives any immunity any of its properties located in the United States may
have from attachment or execution upon a judgment entered by any such court
under the United States Foreign Sovereign Immunities Act of 1976 or any similar
successor legislation.
Section 7.13. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 7.14. ENTIRETY. This Agreement, the Intercreditor Agreement
and the other Operative Agreements to which the Primary Liquidity Provider is a
party constitute the entire agreement of the parties hereto with respect to the
subject matter hereof and supersedes all prior understandings and agreements of
such parties.
Section 7.15. HEADINGS. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
Section 7.16. TRANSFER. The Primary Liquidity Provider hereby
acknowledges and consents to the Transfer contemplated by the Assignment and
Assumption Agreement.
Section 7.17. PRIMARY LIQUIDITY PROVIDER'S OBLIGATION TO MAKE
ADVANCES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS OF
THE PRIMARY LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE BORROWER'S
RIGHTS TO DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF ADVANCES
HEREUNDER, SHALL BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR
PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first set forth above.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Subordination Agent,
as agent and trustee for the Class G-2 Trust,
as Borrower
By:
-----------------------------------------
Name:
Title:
LANDESBANK HESSEN-THURINGEN GIROZENTRALE,
as Primary Liquidity Provider
By:
-----------------------------------------
Name:
Title:
By:
-----------------------------------------
Name:
Title:
ANNEX I TO
REVOLVING CREDIT AGREEMENT
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-2) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of an Interest Advance by the Primary Liquidity Provider to be
used, subject to clause (3)(v) below, for the payment of interest on the
Class G-2 Certificates which was payable on ____________, ____ (the
"DISTRIBUTION DATE") in accordance with the terms and provisions of the
Class G-2 Trust Agreement and the Class G-2 Certificates, which Advance is
requested to be made on ____________, ____. The Interest Advance should be
transferred to [name of bank/wire instructions/ABA number] in favor of
account number [ ], reference [ ].
(3) The amount of the Interest Advance requested hereby (i) is
$[_________________], to be applied in respect of the payment of the
interest which was due and payable on the Class G-2 Certificates on the
Distribution Date, (ii) does not include any amount with respect to the
payment of principal of, or premium on, the Class G-2 Certificates, or
principal of, or interest or premium on, the Class G-1 Certificates, the
Class H Certificates, the Class I Certificates or the Class J
Certificates, (iii) was computed in accordance with the provisions of the
Class G-2 Certificates, the Class G-2 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), (iv) does not exceed the Maximum Available Commitment on the
date hereof, (v) does not include any amount of interest which was due and
payable on the Class G-2 Certificates on such Distribution Date but which
remains unpaid due to the failure of the Depositary to pay any amount of
accrued interest on the Deposits on such Distribution Date and (vi) has
not been and is not the subject of a prior or contemporaneous Notice of
Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will apply the same in accordance with
the terms of Section 3.6(b) of the Intercreditor Agreement, (b) no portion
of such amount shall be applied by the Borrower for any other purpose and
(c) no portion of such amount until so applied shall be commingled with
other funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, the making of the Interest Advance as requested by this Notice of
Borrowing shall automatically reduce, subject to reinstatement in accordance
with the terms of the Liquidity Agreement, the Maximum Available Commitment by
an amount equal to the amount of the Interest Advance requested to be made
hereby as set forth in clause (i) of paragraph (3) of this Notice of Borrowing
and such reduction shall automatically result in corresponding reductions in the
amounts available to be borrowed pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Subordination Agent, as Borrower
By:
-----------------------------------------
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with
Interest Advance Notice of Borrowing]
ANNEX II TO
REVOLVING CREDIT AGREEMENT
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-2) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Non-Extension Advance by the Primary Liquidity Provider to
be used for the funding of the Class G-2 Cash Collateral Account in
accordance with Section 3.6(d) of the Intercreditor Agreement, which
Advance is requested to be made on __________, ____. The Non-Extension
Advance should be transferred to [name of bank/wire instructions/ABA
number] in favor of account number [ ], reference [ ].
(3) The amount of the Non-Extension Advance requested hereby (i) is
$_______________.__, which equals the Maximum Available Commitment on the
date hereof and is to be applied in respect of the funding of the Class
G-2 Cash Collateral Account in accordance with Section 3.6(d) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of the principal of, or premium on, the Class G-2
Certificates, or principal of, or interest or premium on, the Class G-1
Certificates, the Class H Certificates, the Class I Certificates or the
Class J Certificates, (iii) was computed in accordance with the provisions
of the Class G-2 Certificates, the Class G-2 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-2 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(d) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Non-Extension Advance as requested by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of the Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Non-Extension Advance requested by this Notice of Borrowing, the Borrower shall
not be entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Subordination Agent, as Borrower
By:
-----------------------------------------
Name:
Title:
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with
Non-Extension Advance Notice of Borrowing]
ANNEX III TO
REVOLVING CREDIT AGREEMENT
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-2) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Downgrade Advance by the Primary Liquidity Provider to be
used for the funding of the Class G-2 Cash Collateral Account in
accordance with Section 3.6(c) of the Intercreditor Agreement by reason of
the occurrence of a Downgrade Event, which Advance is requested to be made
on __________, ____. The Downgrade Advance should be transferred to [name
of bank/wire instructions/ABA number] in favor of account number [ ],
reference [ ].
(3) The amount of the Downgrade Advance requested hereby (i) is
$_______________.__, which equals the Maximum Available Commitment on the
date hereof and is to be applied in respect of the funding of the Class
G-2 Cash Collateral Account in accordance with Section 3.6(c) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of the principal of, or premium on, the Class G-2
Certificates, or principal of, or interest or premium on, the Class G-1
Certificates, the Class H Certificates, the Class I Certificates or the
Class J Certificates, (iii) was computed in accordance with the provisions
of the Class G-2 Certificates, the Class G-2 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-2 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(c) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Downgrade Advance as requested by this Notice
of Borrowing shall automatically and irrevocably terminate the obligation of the
Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Downgrade Advance requested by this Notice of Borrowing, the Borrower shall not
be entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Subordination Agent, as Borrower
By:
-----------------------------------------
Name:
Title:
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with
Downgrade Advance Notice of Borrowing]
ANNEX IV TO
REVOLVING CREDIT AGREEMENT
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to Landesbank Hessen-Thuringen
Girozentrale (the "PRIMARY LIQUIDITY PROVIDER"), with reference to the Revolving
Credit Agreement (2002-1G-2) dated as of March 25, 2002, between the Borrower
and the Primary Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined or
referenced), that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Final Advance by the Primary Liquidity Provider to be used
for the funding of the Class G-2 Cash Collateral Account in accordance
with Section 3.6(i) of the Intercreditor Agreement by reason of the
receipt by the Borrower of a Termination Notice from the Primary Liquidity
Provider with respect to the Liquidity Agreement, which Advance is
requested to be made on ____________, ____. The Final Advance should be
transferred to [name of bank/wire instructions/ABA number] in favor of
account number [ ], reference [ ].
(3) The amount of the Final Advance requested hereby (i) is
$_________________.__, which equals the Maximum Available Commitment on
the date hereof and is to be applied in respect of the funding of the
Class G-2 Cash Collateral Account in accordance with Section 3.6(i) of the
Intercreditor Agreement, (ii) does not include any amount with respect to
the payment of principal of, or premium on, the Class G-2 Certificates, or
principal of, or interest or premium on, the Class G-1 Certificates, the
Class H Certificates, the Class I Certificates or the Class J
Certificates, (iii) was computed in accordance with the provisions of the
Class G-2 Certificates, the Class G-2 Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached hereto as
Schedule I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class
G-2 Cash Collateral Account and apply the same in accordance with the
terms of Section 3.6(i) of the Intercreditor Agreement, (b) no portion of
such amount shall be applied by the Borrower for any other purpose and (c)
no portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
(5) The Borrower hereby requests that the Advance requested hereby
be a Base Rate Advance [and that such Base Rate Advance be converted into
a LIBOR Advance on the third Business Day following your receipt of this
notice.]
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Final Advance as requested by this Notice of
Borrowing shall automatically and irrevocably terminate the obligation of the
Primary Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Primary Liquidity Provider of the
Final Advance requested by this Notice of Borrowing, the Borrower shall not be
entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ____ day of _________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Subordination Agent, as Borrower
By:
-----------------------------------------
Name:
Title:
- -----------------------------
Bracketed language may be included at Borrower's option.
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert copy of computations in accordance with
Final Advance Notice of Borrowing]
ANNEX V TO
REVOLVING CREDIT AGREEMENT
NOTICE OF TERMINATION
[Date]
Wilmington Trust Company,
as Subordination Agent, as Borrower
Rodney Square North
1100 North Market Square
Wilmington, DE 19890-0001
Attention: Corporate Trust Administration
Revolving Credit Agreement dated as of March 25, 2002 between Wilmington
Trust Company, as Subordination Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 2002-1G-2-[O/S], as Borrower, and
Landesbank Hessen-Thuringen Girozentrale (the "LIQUIDITY AGREEMENT")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the Liquidity
Agreement, by reason of the occurrence of a Liquidity Event of Default and the
existence of a Performing Note Deficiency (each as defined therein), we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined therein) under such Liquidity Agreement to terminate on the fifth
Business Day after the date on which you receive this notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a
consequence of your receipt of this notice.
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE
LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY
AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.
Very truly yours,
LANDESBANK HESSEN-THURINGEN GIROZENTRALE
as Primary Liquidity Provider
By:
-----------------------------------------
Name:
Title:
By:
-----------------------------------------
Name:
Title:
cc: Wilmington Trust Company,
as Class G-2 Trustee
ANNEX VI TO
REVOLVING CREDIT AGREEMENT
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Revolving Credit Agreement dated as of March 25, 2002, between Wilmington
Trust Company, as Subordination Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 2002-1G-2-[O/S], as Borrower, and
Landesbank Hessen-Thuringen Girozentrale (the "LIQUIDITY AGREEMENT")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
------------------------------
[Name of Transferee]
------------------------------
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the Liquidity
Agreement referred to above. The transferee has succeeded the undersigned as
Subordination Agent under the Intercreditor Agreement referred to in the first
paragraph of the Liquidity Agreement, pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower under
the Liquidity Agreement are transferred to the transferee and the transferee
shall hereafter have the sole rights and obligations as Borrower thereunder. The
undersigned shall pay any costs and expenses of such transfer, including, but
not limited to, transfer taxes or governmental charges.
We ask that this transfer be effective as of _______________, ____.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Subordination Agent, as Borrower
By:
-----------------------------------------
Name:
Title:
ISDA(R)
INTERNATIONAL SWAP DEALERS ASSOCIATION, INC.
MASTER AGREEMENT
DATED AS OF MARCH 25, 2002
Merrill Lynch Capital Services, Inc. and Wilmington Trust Company, in its
capacity as Subordination Agent on behalf of the Trustee under the Class G-1
Trust Agreement have entered and/or anticipate entering into one or more
transactions (each a "Transaction") that are or will be governed by this Master
Agreement, which includes the schedule (the "Schedule"), and the documents and
other confirming evidence (each a "Confirmation") exchanged between the parties
confirming those Transactions.
Accordingly, the parties agree as follows:--
1. INTERPRETATION
(a) DEFINITIONS. The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.
(b) INCONSISTENCY. In the event of any inconsistency between the provisions of
the Schedule and the other provisions of this Master Agreement, the Schedule
will prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant Transaction.
(c) SINGLE AGREEMENT. All Transactions are entered into in reliance on the
fact that this Master Agreement and all Confirmations form a single agreement
between the parties (collectively referred to as this "Agreement"), and the
parties would not otherwise enter into any Transactions.
2. OBLIGATIONS
(a) GENERAL CONDITIONS.
(i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of this
Agreement.
(ii) Payments under this Agreement will be made on the due date for value
on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely
transferable funds and in the manner customary for payments in the
required currency. Where settlement is by delivery (that is, other than by
payment), such delivery will be made for receipt on the due date in the
manner customary for the relevant obligation unless otherwise specified in
the relevant Confirmation or elsewhere in this Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject to
(1) the condition precedent that no Event of Default or Potential Event of
Default with respect to the other party has occurred and is continuing,
(2) the condition precedent that no Early Termination Date in respect of
the relevant Transaction has occurred or been effectively designated and
(3) each other applicable condition precedent specified in this Agreement.
(b) CHANGE OF ACCOUNT. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.
(c) NETTING. If on any date amounts would otherwise be payable:--
(i) in the same currency; and
(ii) in respect of the same Transaction.
by each party to the other, then, on such date, each party's obligation to make
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been payable by the other
party, replaced by an obligation upon the party by whom the larger aggregate
amount would have been payable to pay to the other party the excess of the
larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation by specifying that subparagraph (ii) above
will not apply to the Transactions identified as being subject to the election,
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such Transactions from such date). This election may
be made separately for different groups of Transactions and will apply
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.
(d) DEDUCTION OR WITHHOLDING FOR TAX.
(i) GROSS-UP. All payments under this Agreement will be made without any
deduction or withholding for or on account of any Tax unless such
deduction or withholding is required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, then in
effect. If a party is so required to deduct or withhold, then that party
("X") will:--
(1) promptly notify the other party ("Y") of such requirement;
(2) pay to the relevant authorities the full amount required to be
deducted or withheld (including the full amount required to be
deducted or withheld from any additional amount paid by X to Y under
this Section 2(d)) promptly upon the earlier of determining that
such deduction or withholding is required or receiving notice that
such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a certified copy),
or other documentation reasonably acceptable to Y, evidencing such
payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to
the payment to which Y is otherwise entitled under this Agreement,
such additional amount as is necessary to ensure that the net amount
actually received by Y (free and clear of Indemnifiable Taxes,
whether assessed against X or Y) will equal the full amount Y would
have received had no such deduction or withholding been required.
However, X will not be required to pay any additional amount to Y to
the extent that it would not be required to be paid but for:--
(A) the failure by Y to comply with or perform any agreement
contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure would
not have occurred but for (I) any action taken by a taxing
authority, or brought in a court of competent jurisdiction, on
or after the date on which a Transaction is entered into
(regardless of whether such action is taken or brought with
respect to a party to this Agreement) or (II) a Change in Tax
Law.
(ii) LIABILITY. If:--
(1) X is required by any applicable law, as modified by the practice
of any relevant governmental revenue authority, to make any
deduction or withholding in respect of which X would not be required
to pay an additional amount to Y under Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly against
X.
then, except to the extent Y has satisfied or then satisfies the liability
resulting from such Tax, Y will promptly pay to X the amount of such
liability (including any related liability for interest, but including any
related liability for penalties only if Y has failed to comply with or
perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).
(e) DEFAULT INTEREST; OTHER AMOUNTS. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to the
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on
demand in the same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the date of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior to
the occurrence or effective designation of an Early Termination Date in respect
of the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.
3. REPRESENTATIONS
Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered into
and, is the case of the representations in Section 3(f), at all times until the
termination of this Agreement) that:--
(a) BASIC REPRESENTATIONS.
(i) STATUS. It is duly organised and validly existing under the laws of
the jurisdiction of its organisation or incorporation and, if relevant
under such laws, in good standing;
(ii) POWERS. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to
deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to perform
its obligations under this Agreement and any obligations it has under any
Credit Support Document to which it is a party and has taken all necessary
action to authorise such execution, delivery and performance;
(iii) NO VIOLATION OR CONFLICT. Such execution, delivery and performance
do not violate or conflict with any law applicable to it, any provision of
its constitutional documents, any order or judgment of any court or other
agency of government applicable to it or any of its assets or any
contractual restriction binding on or affecting it or any of its assets;
(iv) CONSENTS. All governmental and other consents that are required to
have been obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party have been obtained and are in full
force and effect and all conditions of any such consents have been
complied with; and
(v) OBLIGATIONS BINDING. Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal, valid
and binding obligations, enforceable in accordance with their respective
terms (subject to applicable bankruptcy, reorganisation, insolvency,
moratorium or similar laws affecting creditors' rights generally and
subject, as to enforceability, to equitable principles of general
application (regardless of whether enforcement is sought in a proceeding
in equity or at law)).
(b) ABSENCE OF CERTAIN EVENTS. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.
(c) ABSENCE OF LITIGATION. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.
(d) ACCURACY OF SPECIFIED INFORMATION. All applicable information that is
furnished in writing by or on behalf of it to the other party and is identified
for the purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.
(e) PAYER TAX REPRESENTATION. Each representation specified in the Schedule
as being made by it for the purpose of this Section 3(e) is accurate and true.
(f) PAYEE TAX REPRESENTATIONS. Each representation specified in the Schedule
as being made by it for the purpose of this Section 3(f) is accurate and true.
4. AGREEMENTS
Each party agrees with the other that, so long as either parry has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:--
(a) FURNISH SPECIFIED INFORMATION. It will deliver to the other party or,
in certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:--
(i) any forms, documents or certificates relating to taxation specified in
the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any Confirmation;
and
(iii) upon reasonable demand by such other party, any form or document
that may be required or reasonably requested in writing in order to allow
such other party or its Credit Support Provider to make a payment under
this Agreement or any applicable Credit Support Document without any
deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate (so long as the completion,
execution or submission of such form or document would not materially
prejudice the legal or commercial position of the party in receipt of such
demand), with any such form or document to be accurate and completed in a
manner reasonably satisfactory to such other party and to be executed and
to be delivered with any reasonably required certification.
in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.
(b) MAINTAIN AUTHORISATIONS. It will use all reasonable efforts to maintain in
full force and effect all consents of any governmental or other authority that
are required to be obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party and will use all reasonable efforts to
obtain any that may become necessary in the future.
(c) COMPLY WITH LAWS. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.
(d) TAX AGREEMENT. It will give notice of any failure of a representation
made by it under Section 3(f) to be accurate and true promptly upon learning of
such failure.
(e) PAYMENT OF STAMP TAX. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of this
Agreement by a jurisdiction in which it is incorporated, organised, managed and
controlled, or considered to have its seat, or is which a branch or office
through which it is acting for the purpose of this Agreement is located ("Stamp
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party in respect of the other party's execution
or performance of this Agreement by any such Stamp Tax Jurisdiction which is not
also a Stamp Tax Jurisdiction with respect to the other party.
5. EVENTS OF DEFAULT AND TERMINATION EVENTS
(a) EVENTS OF DEFAULT. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any of the following events constitutes an event of
default (an "Event of Default") with respect to such party:--
(i) FAILURE TO PAY OR DELIVER. Failure by the party to make, when due, any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
required to be made by it if such failure is not remedied on or before the
third Local Business Day after notice of such failure is given to the
party;
(ii) BREACH OF AGREEMENT. Failure by the party to comply with or perform
any agreement or obligation (other than an obligation to make any payment
under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give
notice of a Termination Event or any agreement or obligation under Section
4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party
in accordance with this Agreement if such failure is not remedied on or
before the thirtieth day after notice of such failure is given to the
party;
(iii) CREDIT SUPPORT DEFAULT.
(1) Failure by the party or any Credit Support Provider of such
party to comply with or perform any agreement or obligation to be
complied with or performed by it in accordance with any Credit
Support Document if such failure is continuing after any applicable
grace period has elapsed;
(2) the expiration or termination of such Credit Support Document or
the failing or ceasing of such Credit Support Document to be in full
force and effect for the purpose of this Agreement (in either case
other than in accordance with its terms) prior to the satisfaction
of all obligations of such party under each Transaction to which
such Credit Support Document relates without the written consent of
the other party; or
(3) the party or such Credit Support Provider disaffirms, disclaims,
repudiates or rejects, in whole or in part, or challenges the
validity of, such Credit Support Document;
(iv) MISREPRESENTATION. A representation (other than a representation
under Section 3(e) or (f)) made or repeated or deemed to have been made or
repeated by the party or any Credit Support Provider of such party in this
Agreement or any Credit Support Document proves to have been incorrect or
misleading in any material respect when made or repeated or deemed to have
been made or repeated;
(v) DEFAULT UNDER SPECIFIED TRANSACTION. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such party
(1) defaults under a Specified Transaction and, after giving effect to any
applicable notice requirement or grace period, there occurs a liquidation
of, an acceleration of obligations under, or an early termination of, that
Specified Transaction, (2) defaults, after giving effect to any applicable
notice requirement or grace period, in making any payment or delivery due
on the last payment, delivery or exchange date of, or any payment on early
termination of, a Specified Transaction (or such default continues for at
least three Local Business Days if there is no applicable notice
requirement or grace period) or (3) disaffirms, disclaims, repudiates or
rejects, in whole or in part, a Specified Transaction (or such action is
taken by any person or entity appointed or empowered to operate it or act
on its behalf);
(vi) CROSS DEFAULT. If "Cross Default" is specified in the Schedule as
applying to the party, the occurrence or existence of (l) a default, event
of default or other similar condition or event (however described) in
respect of such party, any Credit Support Provider of such party or any
applicable Specified Entity of such party under one or more agreements or
instruments relating to Specified Indebtedness of any of them
(individually or collectively) in an aggregate amount of not less than the
applicable Threshold Amount (as specified in the Schedule) which has
resulted in such Specified Indebtedness becoming, or becoming capable at
such time of being declared, due and payable under such agreements or
instruments, before it would otherwise have been due and payable or (2) a
default by such party, such Credit Support Provider or such Specified
Entity (individually or collectively) in making one or more payments on
the due date thereof in an aggregate amount of not less than the
applicable Threshold Amount under such agreements or instruments (after
giving effect to any applicable notice requirement or grace period);
(vii) BANKRUPTCY. The party, any Credit Support Provider of such party or
any applicable Specified Entity of such party:--
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to pay
its debts or fails or admits in writing its inability generally to
pay its debts as they become due; (3) makes a general assignment.
arrangement or composition with or for the benefit of its creditors;
(4) institutes or has instituted against it a proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any
bankruptcy or insolvency law or other similar law affecting
creditors' rights, or a petition is presented for its winding-up or
liquidation, and, in the case of any such proceeding or petition
instituted or presented against it, such proceeding or petition (A)
results in a judgment of insolvency or bankruptcy or the entry of an
order for relief or the making of an order for its winding-up or
liquidation or (B) is not dismissed, discharged, stayed or
restrained in each case within 30 days of the institution or
presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant
to a consolidation. amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other
similar official for it or for all or substantially all its assets;
(7) has a secured party take possession of all or substantially all
its assets or has a distress, execution, attachment, sequestration
or other legal process levied, enforced or sued on or against all or
substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed
or restrained, in each case within 30 days thereafter; (8) causes or
is subject to any event with respect to it which, under the
applicable laws of any jurisdiction, has an analogous effect to any
of the events specified in clauses (1) to (7) (inclusive); or (9)
takes any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the foregoing acts; or
(viii) MERGER WITHOUT ASSUMPTION. The party or any Credit Support Provider
of such party consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and, at
the time of such consolidation, amalgamation, merger or transfer:--
(1) the resulting, surviving or transferee entity fails to assume
all the obligations of such party or such Credit Support Provider
under this Agreement or any Credit Support Document to which it or
its predecessor was a party by operation of law or pursuant to an
agreement reasonably satisfactory to the other party to this
Agreement; or
(2) the benefits of any Credit Support Document fail to extend
(without the consent of the other party) to the performance by such
resulting, surviving or transferee entity of its obligations under
this Agreement.
(b) TERMINATION EVENTS. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the
event is specified in (i) below, a Tax Event if the event is specified in (ii)
below or a Tax Event Upon Merger if the event is specified in (iii) below, and,
if specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:--
(i) ILLEGALITY. Due to the adoption of, or any change in, any applicable
law after the date on which a Transaction is entered into, or due to the
promulgation of, or any change in, the interpretation by any court,
tribunal or regulatory authority with competent jurisdiction of any
applicable law after such date, it becomes unlawful (other than as a
result of a breach by the party of Section 4(b)) for such party (which
will be the Affected Party):--
(1) to perform any absolute or contingent obligation to make a
payment or delivery or to receive a payment or delivery in
respect of such Transaction or to comply with any other
material provision of this Agreement relating to such
Transaction; or
(2) to perform, or for any Credit Support Provider of such
party to perform, any contingent or other obligation which the
party (or such Credit Support Provider) has under any Credit
Support Document relating to such Transaction;
(ii) TAX EVENT. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such action
is taken or brought with respect to a party to this Agreement) or (y) a
Change in Tax Law, the party (which will be the Affected Party) will,
or there is a substantial likelihood that it will, on the next
succeeding Scheduled Payment Date (1) be required to pay to the other
party an additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is
required to be deducted or withheld for or on account of a Tax (except
in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no
additional amount is required to be paid in respect of such Tax under
Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or
(B));
(iii) TAX EVENT UPON MERGER. The party (the "Burdened Party") on the
next succeeding Scheduled Payment Date will either (1) be required to
pay an additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has
been deducted or withheld for or on account of any Indemnifiable Tax in
respect of which the other party is not required to pay an additional
amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in
either case as a result of a party consolidating or amalgamating with,
or merging with or into, or transferring all or substantially all its
assets to, another entity (which will be the Affected Party) where such
action does not constitute an event described in Section 5(a)(viii);
(iv) CREDIT EVENT UPON MERGER. If "Credit Event Upon Merger" is
specified in the Schedule as applying to the party, such party ("X"),
any Credit Support Provider of X or any applicable Specified Entity of
X consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and
such action does not constitute an event described in Section
5(a)(viii) but the creditworthiness of the resulting, surviving or
transferee entity is materially weaker than that of X, such Credit
Support Provider or such Specified Entity, as the case may be,
immediately prior to such action (and, in such event, X or its
successor or transferee, as appropriate, will be the Affected Party);
or
(v) ADDITIONAL TERMINATION EVENT. If any "Additional Termination Event"
is specified in the Schedule or any Confirmation as applying, the
occurrence of such event (and, in such event, the Affected Party or
Affected Parties shall be as specified for such Additional Termination
Event in the Schedule or such Confirmation).
(c) EVENT OF DEFAULT AND ILLEGALITY. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.
6. EARLY TERMINATION
(a) RIGHT TO TERMINATE FOLLOWING EVENT OF DEFAULT. If at any time an Event of
Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all outstanding Transactions. If, however,
"Automatic Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding Transactions
will occur immediately upon the occurrence with respect to such party of an
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the
extent analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).
(b) RIGHT TO TERMINATE FOLLOWING TERMINATION EVENT.
(i) NOTICE. If a Termination Event occurs, an Affected Party will,
promptly upon becoming aware of it, notify the other party, specifying the
nature of that Termination Event and each Affected Transaction and will
also give such other information about that Termination Event as the other
party may reasonably require.
(ii) TRANSFER TO AVOID TERMINATION EVENT. If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger Occurs and the Burdened Party is the
Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all
reasonable efforts (which will not require such party to incur a loss,
excluding immaterial, incidental expenses) to transfer within 20 days
after it gives notice under Section 6(b)(i) all its rights and obligations
under this Agreement in respect of the Affected Transactions to another of
its Offices or Affiliates so that such Termination Event ceases to exist.
If the Affected Party is not able to make such a transfer it will give
notice to the other party to that effect within such 20 day period,
whereupon the other party may effect such a transfer within 30 days after
the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be subject
to and conditional upon the prior written consent of the other party,
which consent will not be withheld if such other party's policies in
effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.
(iii) TWO AFFECTED PARTIES. If an Illegality under Section 5(b)(i)(1) or
a Tax Event occurs and there are two Affected Parties, each party will
use all reasonable efforts to reach agreement within 30 days after notice
thereof is given under Section 6(b)(i) on action to avoid that Termination
Event.
(iv) RIGHT TO TERMINATE. If:--
(1) a transfer under Section 6(b)(ii) or an agreement under Section
6(b)(iii), as the case may be, has not been effected with respect to
all Affected Transactions within 30 days after an Affected Party
gives notice under Section 6(b)(i); or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon
Merger or an Additional Termination Event occurs, or a Tax Event
Upon Merger occurs and the Burdened Party is not the Affected Party,
either party in the case of an Illegality, the Burdened Party in the case
of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event
or an Additional Termination Event if there is more than one Affected
Party, or the party which is not the Affected Party in the case of a
Credit Event Upon Merger or an Additional Termination Event if there is
only one Affected Party may, by not more than 20 days notice to the other
party and provided that the relevant Termination Event is then continuing,
designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all Affected Transactions.
(c) EFFECT OF DESIGNATION.
(i) If notice designating an Early Termination Date is given under Section
6(a) or (b), the Early Termination Date will occur on the date so
designated, whether or not the relevant Event of Default or Termination
Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early Termination
Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in
respect of the Terminated Transactions will be required to be made, but
without prejudice to the other provisions of this Agreement. The amount,
if any, payable in respect of an Early Termination Date shall be
determined pursuant to Section 6(e).
(d) CALCULATIONS.
(i) STATEMENT. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and will
provide to the other party a statement (1) showing, in reasonable detail,
such calculations (including all relevant quotations and specifying any
amount payable under Section 6(e)) and (2) giving details of the relevant
account to which any amount payable to it is to be paid. In the absence of
written confirmation from the source of a quotation obtained in
determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of
such quotation.
(ii) PAYMENT DATE. An amount calculated as being due in respect of any
Early Termination Date under Section 6(e) will be payable on the day that
notice of the amount payable is effective (in the case of an Early
Termination Date which is designated or occurs as a result of an Event of
Default) and on the day which is two Local Business Days after the day on
which notice of the amount payable is effective (in the case of an Early
Termination Date which is designated as a result of a Termination Event).
Such amount will be paid together with (to the extent permitted under
applicable law) interest thereon (before as well as after judgment) in the
Termination Currency, from (and including) the relevant Early Termination
Date to (but excluding) the date such amount is paid, at the Applicable
Rate. Such interest will be calculated on the basis of daily compounding
and the actual number of days elapsed.
(e) PAYMENTS ON EARLY TERMINATION. If an Early Termination Date occurs, the
following provisions shall apply based on the parties' election in the Schedule
of a payment measure, either "Market Quotation" or "Loss", and a payment method,
either the "First Method" or the "Second Method". If the parties fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject to any Set-off.
(i) EVENTS OF DEFAULT. If the Early Termination Date results from an
Event of Default:--
(1) FIRST METHOD AND MARKET QUOTATION. If the First Method and
Market Quotation apply, the Defaulting Party will pay to the
Non-defaulting Party the excess, if a positive number, of (A) the
sum of the Settlement Amount (determined by the Non-defaulting
Party) is respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party.
(2) FIRST METHOD AND LOSS. If the First Method and Loss apply, the
Defaulting Party will pay to the Non-defaulting Party, if a positive
number, the Non-defaulting Party's Loss in respect of this
Agreement.
(3) SECOND METHOD AND MARKET QUOTATION. If the Second Method and
Market Quotation apply, an amount will be payable equal to (A) the
sum of the Settlement Amount (determined by the Non-defaulting
Party) in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party less (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party. If that amount is
a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting
Party will pay the absolute value of that amount to the Defaulting
Party.
(4) SECOND METHOD AND LOSS. If the Second Method and Loss apply, an
amount will be payable equal to the Non-defaulting Party's Loss in
respect of this Agreement. If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting Party; if it is a
negative number, the Non-defaulting Party will pay the absolute
value of that amount to the Defaulting Party.
(ii) TERMINATION EVENTS. If the Early Termination Date results from a
Termination Event:--
(1) ONE AFFECTED PARTY. If there is one Affected Party, the amount
payable will be determined in accordance with Section 6(e)(i)(3), if
Market Quotation applies, or Section 6(e)(i)(4), if Loss applies,
except that, in either case, references to the Defaulting Party and
to the Non-defaulting Party will be deemed to be references to the
Affected Party and the party which is not the Affected Party,
respectively, and, if Loss applies and fewer than all the
Transactions are being terminated, Loss shall be calculated in
respect of all Terminated Transactions.
(2) TWO AFFECTED PARTIES. If there are two Affected Parties:--
(A) if Market Quotation applies, each party will determine a
Settlement Amount in respect of the Terminated Transactions,
and an amount will be payable equal to (I) the sum of (a)
one-half of the difference between the Settlement Amount of
the party with the higher Settlement Amount ("X") and the
Settlement Amount of the party with the lower Settlement
Amount ("Y") and (b) the Termination Currency Equivalent of
the Unpaid Amounts owing to X less (II) the Termination
Currency Equivalent of the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its Loss in
respect of this Agreement (or, if fewer than all the
Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal
to one-half of the difference between the Loss of the party
with the higher Loss ("X") and the Loss of the party with the
lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to
X; if it is a negative number, X will pay the absolute value
of that amount to Y.
(iii) ADJUSTMENT FOR BANKRUPTCY. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies in
respect of a party, the amount determined under this Section 6(e) will be
subject to such adjustments as are appropriate and permitted by law to
reflect any payments or deliveries made by one party to the other under
this Agreement (and retained by such other party) during the period from
the relevant Early Termination Date to the date for payment determined
under Section 6(d)(ii).
(iv) PRE-ESTIMATE. The parties agree that if Market Quotation applies an
amount recoverable under this Section 6(e) is a reasonable pre-estimate of
loss and not a penalty. Such amount is payable for the loss of bargain and
the loss of protection against future risks and except as otherwise
provided in this Agreement neither party will be entitled to recover any
additional damages as a consequence of such losses.
7. TRANSFER
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of the
other party, except that:--
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).
Any purported transfer that is not in compliance with this Section will be void.
8. CONTRACTUAL CURRENCY
(a) PAYMENT IN THE CONTRACTUAL CURRENCY. Each payment under this Agreement
will be made in the relevant currency specified in this Agreement for that
payment (the "Contractual Currency"). To the extent permitted by applicable law,
any obligation to make payments under this Agreement in the Contractual Currency
will not be discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable manner and
in good faith in converting the currency so tendered into the Contractual
Currency, of the full amount in the Contractual Currency of all amounts payable
in respect of this Agreement. If for any reason the amount in the Contractual
Currency so received falls short of the amount in the Contractual Currency
payable in respect of this Agreement, the party required to make the payment
will, to the extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate for the
shortfall. If for any reason the amount in the Contractual Currency so received
exceeds the amount in the Contractual Currency payable in respect of this
Agreement, the party receiving the payment will refund promptly the amount of
such excess.
(b) JUDGMENTS. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the
Contractual Currency.
(c) SEPARATE INDEMNITIES. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof being made for any other sums payable is respect of this
Agreement.
(d) EVIDENCE OF LOSS. For the purpose of this Section 8, it will be sufficient
for a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.
9. MISCELLANEOUS
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.
(b) AMENDMENTS. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.
(c) SURVIVAL OF OBLIGATIONS. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.
(d) REMEDIES CUMULATIVE. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.
(e) COUNTERPARTS AND CONFIRMATIONS.
(i) This Agreement (and each amendment, modification and waiver in respect
of it) may be executed and delivered in counterparts (including by
facsimile transmission), each of which will be deemed an original.
(ii) The parties intend that they are legally bound by the terms of each
Transaction from the moment they agree to those terms (whether orally or
otherwise). A Confirmation shall be entered into as soon as practicable
and may be executed and delivered in counterparts (including by facsimile
transmission) or be created by an exchange of telexes or by an exchange of
electronic messages on an electronic messaging system, which in each case
will be sufficient for all purposes to evidence a binding supplement to
this Agreement. The parties will specify therein or through another
effective means that any such counterpart, telex or electronic message
constitutes a Confirmation.
(f) NO WAIVER OF RIGHTS. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.
(g) HEADINGS. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.
10. OFFICES; MULTIBRANCH PARTIES
(a) If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organisation of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.
(b) Neither party may change the Office through which it makes and receives
payments or deliveries for the purpose of a Transaction without the prior
written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.
11. EXPENSES
A Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of collection.
12. NOTICES
(a) EFFECTIVENESS. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:--
(i) if in writing and delivered in person or by courier, on the date it is
delivered;
(ii) if sent by telex, on the date the recipient's answerback is received;
(iii) if sent by facsimile transmission, on the date that transmission is
received by a responsible employee of the recipient in legible form (it
being agreed that the burden of proving receipt will be on the sender and
will not be met by a transmission report generated by the sender's
facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas) or the
equivalent (return receipt requested), on the date that mail is delivered
or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that electronic
message is received.
unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) CHANGE OF ADDRESSES. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.
13. GOVERNING LAW AND JURISDICTION
(a) GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) JURISDICTION. With respect to any suit, action or proceedings relating
to this Agreement ("Proceedings"), each party irrevocably:--
(i) submits to the jurisdiction of the English courts, if this Agreement
is expressed to be governed by English law, or to the non-exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in New York City, if
this Agreement is expressed to be governed by the laws of the State of New
York; and
(ii) waives any objection which it may have at any time to the laying of
venue of any Proceedings brought in any such court, waives any claim that
such Proceedings have been brought in an inconvenient forum and further
waives the right to object, with respect to such Proceedings, that such
court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Act 1982 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) SERVICE OF PROCESS. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party. The parties irrevocably consent to service of process given in
the manner provided for notices in Section 12. Nothing in this Agreement will
affect the right of either party to serve process in any other manner permitted
by law.
(d) WAIVER OF IMMUNITIES. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and assets
(irrespective of their use or intended use), all immunity on the grounds of
sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any
court, (iii) relief by way of injunction, order for specific performance or for
recovery of property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it or its
revenues or assets might otherwise be entitled in any Proceedings in the courts
of any jurisdiction and irrevocably agrees, to the extent permitted by
applicable law, that it will not claim any such immunity in any Proceedings.
14. DEFINITIONS
As used in this Agreement:--
"ADDITIONAL TERMINATION EVENT" has the meaning specified in Section 5(b).
"AFFECTED PARTY" has the meaning specified in Section 5(b).
"AFFECTED TRANSACTIONS" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"AFFILIATE" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control" of
any entity or person means ownership of a majority of the voting power of the
entity or person.
"APPLICABLE RATE" means:--
(a) in respect of obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with Section 6(d)(iii))
on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or which
would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the
Non-default Rate; and
(d) in all other cases, the Termination Rate.
"BURDENED PARTY" has the meaning specified in Section 5(b).
"CHANGE IN TAX LAW" means the enactment, promulgation, execution or ratification
of, or any change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the
relevant Transaction is entered into.
"CONSENT" includes a consent, approval, action, authorisation, exemption,
notice, filing, registration or exchange control consent.
"CREDIT EVENT UPON MERGER" has the meaning specified in Section 5(b).
"CREDIT SUPPORT DOCUMENT" means any agreement or instrument that is specified as
such in this Agreement.
"CREDIT SUPPORT PROVIDER" has the meaning specified is the Schedule.
"DEFAULT RATE" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.
"DEFAULTING PARTY" has the meaning specified in Section 6(a).
"EARLY TERMINATION DATE" means the date determined in accordance with Section
6(a) or 6(b)(iv).
"EVENT OF DEFAULT" has the meaning specified in Section 5(a) and, if applicable,
in the Schedule.
"ILLEGALITY" has the meaning specified in Section 5(b).
"LNDEMNIFIABLE TAX" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation authority imposing such
Tax and the recipient of such payment or a person related to such recipient
(including, without limitation, a connection arising from such recipient or
related person being or having been a citizen or resident of such jurisdiction,
or being or having been organised, present or engaged in a trade or business in
such jurisdiction, or having or having had a permanent establishment or fixed
place of business in such jurisdiction, but excluding a connection arising
solely from such recipient or related person having executed, delivered,
performed its obligations or received a payment under, or enforced, this
Agreement or a Credit Support Document).
"LAW" includes any treaty, law, rule or regulation (as modified in the case of
tax matters, by the practice of any relevant governmental revenue authority) and
"LAWFUL" and "UNLAWFUL" will be construed accordingly.
"LOCAL BUSINESS DAY" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in
the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions
contained, or incorporated by reference, in this Agreement, (b) in relation to
any other payment, in the place where the relevant account is located and, if
different, in the principal financial centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.
"LOSS" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be its
total losses and costs (or gain, in which case expressed as a negative number)
in connection with this Agreement or that Terminated Transaction or group of
Terminated Transactions, as the case may be, including any loss of bargain, cost
of funding or, at the election of such party but without duplication, loss or
cost incurred as a result of its terminating, liquidating, obtaining or
reestablishing any hedge or related trading position (or any gain resulting from
any of them). Loss includes losses and costs (or gains) in respect of any
payment or delivery required to have been made (assuming satisfaction of each
applicable condition precedent) on or before the relevant Early Termination Date
and not made, except, so as to avoid duplication, if Section 6(e)(i)(l) or (3)
or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and
out-of-pocket expenses referred to under Section 11. A party will determine its
Loss as of the relevant Early Termination Date, or, if that is not reasonably
practicable, as of the earliest date thereafter as is reasonably practicable. A
party may (but need not) determine its Loss by reference to quotations of
relevant rates or prices from one or more leading dealers in the relevant
markets.
"MARKET QUOTATION" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the "Replacement Transaction") that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such Terminated Transaction
or group of Terminated Transactions that would, but for the occurrence of the
relevant Early Termination Date, have been required after that date. For this
purpose, Unpaid Amounts in respect of the Terminated Transaction or group of
Terminated Transactions are to be excluded but, without limitation, any payment
or delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition precedent) after
that Early Termination Date is to be included. The Replacement Transaction would
be subject to such documentation as such party and the Reference Market-maker
may, in good faith, agree. The party making the determination (or its agent)
will request each Reference Market-maker to provide its quotation to the extent
reasonably practicable as of the same day and time (without regard to different
time zones) on or as soon as reasonably practicable after the relevant Early
Termination Date. The day and time as of which those quotations are to be
obtained will be selected in good faith by the party obliged to make a
determination under Section 6(e), and, if each party is so obliged, after
consultation with the other. If more than three quotations are provided, the
Market Quotation will be the arithmetic mean of the quotations, without regard
to the quotations having the highest and lowest values. If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations. For this purpose, if more
than one quotation has the same highest value or lowest value, then one of such
quotations shall be disregarded. If fewer than three quotations are provided, it
will be deemed that the Market Quotation in respect of such Terminated
Transaction or group of Terminated Transactions cannot be determined.
"NON-DEFAULT RATE" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it) if
it were to fund the relevant amount.
"NON-DEFAULTING PARTY" has the meaning specified in Section 6(a).
"OFFICE" means a. branch or office of a party, which may be such party's head or
home office.
"POTENTIAL EVENT OF DEFAULT" means any event which, with the giving of notice or
the lapse of time or both, would constitute as Event of Default.
"REFERENCE MARKET-MAKERS" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria that
such party applies generally at the time in deciding whether to offer or to make
an extension of credit and (b) to the extent practicable, from among such
dealers having an office in the same city.
"RELEVANT JURISDICTION" means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organised, managed and controlled or considered
to have its seat, (b) where an Office through which the party is acting for
purposes of this Agreement is located, (c) in which the party executes this
Agreement and (d) in relation to any payment, from or through which such payment
is made.
"SCHEDULED PAYMENT DATE" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"SET-OFF" means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.
"SETTLEMENT AMOUNT" means, with respect to a party and any Early Termination
Date, the sum of:--
(a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction a group of Terminated
Transactions for which a Market Quotation is determined; and
(b) such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not (in
the reasonable belief of the party making the determination) produce a
commercially reasonable result.
"SPECIFIED ENTITY" has the meaning specified in the Schedule.
"SPECIFIED INDEBTEDNESS" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of borrowed money.
"SPECIFIED TRANSACTION" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to
this Agreement (or any Credit Support Provider of such other party or any
applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions), (b) any combination of
these transactions and (c) any other transaction identified as a Specified
Transaction in this Agreement or the relevant confirmation.
"STAMP TAX" means any stamp, registration, documentation or similar tax.
"TAX" means any present or future tax, levy, impost, duty, charge, assessment or
fee of any nature (including interest, penalties and additions thereto) that is
imposed by any government or other taxing authority in respect of any payment
under this Agreement other than a stamp, registration, documentation or similar
tax.
"TAX EVENT" has the meaning specified in Section 5(b).
"TAX EVENT UPON MERGER" has the meaning specified in Section 5(b).
"TERMINATED TRANSACTIONS" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).
"TERMINATION CURRENCY" has the meaning specified in the Schedule.
"TERMINATION CURRENCY EQUIVALENT" means, in respect of any amount denominated in
the Termination Currency, such Termination Currency amount and, in respect of
any amount denominated in a currency other than the Termination Currency (the
"Other Currency"), the amount in the Termination Currency determined by the
party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or, if
the relevant Market Quotation or Loss (as the case may be), is determined as of
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.
"TERMINATION EVENT" means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.
"TERMINATION RATE" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as certified
by such party) if it were to fund or of funding such amounts.
"UNPAID AMOUNTS" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have became payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market value of that which was (or would have been) required to be
delivered as of the originally scheduled date for delivery, in each case
together with (to the extent permitted under applicable law) interest, in the
currency of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or performed to
(but excluding) such Early Termination Date, at the Applicable Rate. Such
amounts of interest will be calculated on the basis of daily compounding and the
actual number of days elapsed. The fair market value of any obligation referred
to in clause (b) above shall be reasonably determined by the party obliged to
make the determination under Section 6(e) or, if each party is so obliged, it
shall, be the average of the Termination Currency Equivalents of the fair market
values reasonably determined by both parties.
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
WILMINGTON TRUST COMPANY, in its
capacity as Subordination Agent on
behalf of the TRUSTEE UNDER THE
MERRILL LYNCH CAPITAL SERVICES, INC. CLASS G-1 TRUST AGREEMENT
- ------------------------------------ ------------------------------------
(Name of Party) (Name of Party)
By:--------------------------------- By:---------------------------------
Name: RICHARD ZALESKI Name: Monica M. Henry
Title: DESIGNATED SIGNATORY Title: Senior Financial Services
Officer
Date: Date:
SCHEDULE
to the
MASTER AGREEMENT
dated as of March 25, 2002
between
MERRILL LYNCH CAPITAL SERVICES, INC. and WILMINGTON TRUST COMPANY, a Delaware
a corporation organized under corporation, in its capacity as
the laws of the State of Delaware Subordination Agent on behalf of
("PARTY A") Trustee under the Pass Through Trust
Agreement dated as of September 25,
1997 between Wilmington Trust
Company and Continental Airlines,
Inc., as supplemented by the
Supplement No. 2002-1G-1-O dated as
of March 25, 2002 ("PARTY B")
PART 1
TERMINATION PROVISIONS
In this Agreement:
(A) SPECIFIED ENTITY. None.
(B) SPECIFIED TRANSACTION. Specified Transaction will have the meaning
specified in Section 14.
(C) EVENTS OF DEFAULT. The "Events of Default" set forth in Section 5(a) will
not apply to Party B but will apply to Party A (subject to clause (d)
below).
(D) CROSS DEFAULT. The "Cross Default" provision of Section 5(a)(vi) will not
apply.
(E) CREDIT EVENT UPON MERGER. The "Credit Event Upon Merger" provisions of
Section 5(b)(iv) will not apply.
(F) ILLEGALITY, TAX EVENT AND TAX EVENT UPON MERGER. The "Illegality"
provisions of Section 5(b)(i), the "Tax Event" provisions of Section
5(b)(ii), and the "Tax Event Upon Merger" provisions of Section 5(b)(iii)
will not apply to Party B but will apply to Party A.
(G) AUTOMATIC EARLY TERMINATION. The "Automatic Early Termination" provision
of Section 6(a) will not apply.
(H) PAYMENTS ON EARLY TERMINATION. Section 6(e) is amended by deleting the
existing provisions thereof and substituting the following: "The amount
payable on any early termination of a Transaction evidenced by a
Confirmation shall be an amount equal to the "Termination Amount" (as
defined in such Confirmation) and such amount shall only be payable by
Party A."
(I) TERMINATION CURRENCY. "Termination Currency" means United States Dollars.
(J) ADDITIONAL TERMINATION EVENT. Additional Termination Event will not apply
unless otherwise specified in a Confirmation.
(K) LIMITATIONS ON CONDITIONS PRECEDENT. Notwithstanding Section 2(a) as
incorporated in any Confirmation, the obligation of Party A to make each
payment specified in such Confirmation, so long as it shall remain in
effect, shall not be subject to any conditions precedent, and, without
limiting the foregoing, Party A agrees that it will make each such payment
without offset, counterclaim or defense.
PART 2
TAX REPRESENTATIONS
(A) PAYER TAX REPRESENTATIONS. For the purpose of Section 3(e), Party A and
Party B each make the following representation:
It is not required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, of any Relevant Jurisdiction
to make any deduction or withholding for or on account of any Tax from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e)) to be
made by it to the other party under this Agreement. In making this
representation, it may rely on:
(i) the accuracy of any representation made by the other party pursuant
to Section 3(f);
(ii) the satisfaction of the agreement of the other party contained in
Section 4(a)(i) or 4(a)(iii) and the accuracy and effectiveness of
any document provided by the other party pursuant to Section 4(a)(i)
or 4(a)(iii); and
(iii) the satisfaction of the agreement of the other party contained in
Section 4(d); provided that it shall not be a breach of this
representation where reliance is placed on clause (ii), and the
other party does not deliver a form or document under Section
4(a)(iii) by reason of material prejudice to its legal or commercial
position.
(B) PAYEE REPRESENTATIONS. For the purpose of Section 3(f) of this Agreement,
Party A and Party B make the following representations, respectively:
(i) The following representation applies to Party A:
Party A is a corporation organized under the laws of Delaware.
(ii) The following representation applies to Party B:
Party B is a corporation organized under the laws of Delaware.
PART 3
AGREEMENT TO DELIVER DOCUMENTS
EACH PARTY AGREES TO DELIVER THE FOLLOWING DOCUMENTS AS APPLICABLE:
For the purpose of Section 4(a)(ii), documents to be delivered are:
PARTY REQUIRED TO FORM/DOCUMENT/ DATE BY WHICH TO BE COVERED BY SECTION 3(D)
DELIVER DOCUMENTS CERTIFICATE DELIVERED REPRESENTATION
Party A and Party B Evidence reasonably Upon execution of this Yes
satisfactory to the other Agreement and, if
party as to the names, requested, upon execution
true signatures and of any Confirmation.
authority of the officer
or officials signing this
Agreement or any
Confirmation on its behalf
Party A A copy of the annual Upon request, as soon as Yes
report for Party A publicly available
containing audited or
certified financial
statements for the most
recently ended financial
year
Party A Opinion of counsel to Upon execution of this No
Party A reasonably Agreement
satisfactory in form and
substance to Party B
attached hereto as Exhibit B
PART 4
MISCELLANEOUS
(A) ADDRESSES FOR NOTICES. For the purpose of Section 12(a):
(i) Address for notices or communications to Party A :
Address: MERRILL LYNCH WORLD HEADQUARTERS
4 WORLD FINANCIAL CENTER, 18TH FLOOR
NEW YORK, NEW YORK 10080
Attention: SWAP GROUP
Facsimile No.: 646 805-0218
Telephone No.: 212 449-7403
(For all purposes.)
Additionally, a copy of all notices pursuant to Sections 5, 6, and 7 as well as
any changes to counterparty's address, telephone number or facsimile number
should be sent to:
GMI COUNSEL
MERRILL LYNCH WORLD HEADQUARTERS
4 WORLD FINANCIAL CENTER , 12TH FLOOR
NEW YORK, NEW YORK 10080
ATTENTION: SWAPS LEGAL
FACSIMILE NO.: 212 449-6993
Telephone number for oral confirmation of receipt of facsimile in legible form:
212-449-2311
Designated responsible employee for the purposes of Section 12(a)(iii):
Christopher Wildes
(ii) Address for notices or communications to Party B:
Wilmington Trust Company
One Rodney Square
1100 N. Market Street
Wilmington, Delaware 19890-0001
Telephone No.: 302-651-8813
Facsimile No.: 302-651-8882
(For all purposes.)
(B) OFFICES. The provisions of Section 10(a) will apply to this Agreement.
(C) MULTIBRANCH PARTY. For the purpose of Section 10(c):
Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(D) CALCULATION AGENT. The Calculation Agent is Party A, unless otherwise
agreed in a Confirmation in relation to the relevant Transaction, and
unless an Event of Default with respect to Party A has occurred and is
continuing, in which case Party B may appoint at its own expense one of
the following five entities as Calculation Agent: The Chase Manhattan
Bank, Credit Suisse First Boston, Bank of America, N.A., Deutsche Bank
A.G. or Citibank, N.A.
(E) CREDIT SUPPORT DOCUMENT. Details of any Credit Support Document:
Party A: Guarantee of Merrill Lynch & Co., Inc. ("ML & Co.") in the form
attached hereto as Exhibit A.
(F) CREDIT SUPPORT PROVIDER.
Credit Support Provider means in relation to Party A: ML & Co.
Credit Support Provider means in relation to Party B: None.
(G) GOVERNING LAW. This Agreement and each Confirmation will be governed by
and construed in accordance with the laws of the State of New York.
(H) NETTING OF PAYMENTS. The netting of payments provision set forth in
Section 2(c) will not apply to any Transaction.
(I) AFFILIATE. Affiliate will have the meaning specified in Section 14.
PART 5
OTHER PROVISIONS
(A) DEFINITIONS. Unless otherwise specified in a Confirmation, this Agreement
and each Transaction between the parties are subject to the 2000 ISDA
Definitions and Annex to the 2000 ISDA Definitions (June 2000 Version) as
published by the International Swap Dealers Association, Inc. (collectively, the
"Definitions"), and will be governed in all relevant respects by the provisions
set forth in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions are
incorporated by reference in and shall be deemed a part of this Agreement,
except that references in the Definitions to a "Swap Transaction" shall be
deemed references to a "Transaction" for purposes of this Agreement. In the
event of any inconsistency between the provisions of this Agreement and the
Definitions, this Agreement will prevail. "Intercreditor Agreement" as used in
this Agreement shall mean the Intercreditor Agreement dated as of March 25, 2002
among Wilmington Trust Company, as Trustee under the Continental Airlines Pass
Through Trust 2002-1G-1, Continental Airlines Pass Through Trust 2002-1G-2,
Continental Airlines Pass Through Trust 2002-1H and Continental Airlines Pass
Through Trust 2002-1I, Landesbank Hessen-Thuringen Girozentrale, as Class G-1
Primary Liquidity Provider and Class G-2 Primary Liquidity Provider, Merrill
Lynch Capital Services, Inc., as Class G-1 Above-Cap Liquidity Provider, Ambac
Assurance Corporation, as Policy Provider, and Wilmington Trust Company, as
Subordination Agent and Trustee.
(B) INDEPENDENT RELIANCE. Except as provided in Section 3 of this Agreement,
Party A and Party B each represents to the other that it is entering into this
Agreement and will enter into each Transaction in reliance upon such tax,
accounting, regulatory, legal, and financial advice as it deems necessary and
not upon any view expressed by the other.
(C) WAIVER OF JURY TRIAL. Each party hereby waives its respective right to jury
trial with respect to any litigation arising under, or in connection with, this
Agreement or any Transaction.
(D) NON-PETITION. Party A agrees that it will not, prior to the Termination Date
of any Confirmation and the date that is one year and one day following the
final payment of the Certificates (as defined in the Intercreditor Agreement),
acquiesce, petition or otherwise invoke or cause, or join in invoking or
causing, Party B or any other person or entity to invoke the process of any
governmental authority for the purpose of commencing or sustaining a case
(whether voluntary or involuntary) against Party B under any bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of Party B or any
substantial part of its property or ordering the winding-up or liquidation of
the affairs of Party B.
(E) WAIVER OF CONTRACTUAL RIGHT OF SETOFF. Notwithstanding any provision of this
Agreement as incorporated in any Confirmation or any other existing or future
agreement, each party irrevocably waives any and all contractual rights it may
have to set off, net, recoup or otherwise withhold or suspend or condition
payment or performance of any obligation between the two parties hereunder
against any obligations between the two parties under any other agreements or
otherwise.
(F) AMENDMENTS. This Agreement is hereby further amended as follows:
(1) Section 2(b) is hereby amended by the insertion of the following at
the end thereof after the word "change": "provided that if such new
account shall not be in the same jurisdiction having the same power
to tax as the original account, the party not changing its account
shall not be obliged to pay any greater amounts and shall not
receive less as a result of such change than would have been the
case if such change had not taken place."
(2) Section 2(d) is amended by adding thereto a new final sentence
reading as follows: "Anything in this Section 2(d) to the contrary
notwithstanding, Party B shall not be obligated to make any payment
under this Section 2(d) to Party A".
(3) Section 6 is amended as follows:
(A) The first paragraph in Section 6(b)(ii) shall be amended by
adding the words "(so long as the transferee's obligations
under this Agreement are supported by a Credit Support
Document in such form as shall permit each Rating Agency (as
defined in the Intercreditor Agreement) to issue a Ratings
Confirmation (as defined in the Intercreditor Agreement)
unless such transferee meets the Threshold Rating (as defined
in the Intercreditor Agreement)) or, at its own expense, to
arrange within such 20 days for one or more Replacement
Above-Cap Liquidity Providers (as defined in the Intercreditor
Agreement) to issue and deliver a Replacement Above-Cap
Liquidity Facility (as defined in the Intercreditor Agreement)
to Party B" after the words "its Offices or Affiliates"
appearing in the penultimate line thereof;
(B) The second paragraph in Section 6(b)(ii) shall be deleted in
its entirety;
(C) Section 6(b) shall be amended by adding thereto a new final
sentence reading as follows: "Anything in this Section 6(b) to
the contrary notwithstanding, the following provisions will
apply in the case of an Illegality under Section 5(b)(i): (1)
within 10 days after it gives notice under Section 6(b)(i),
the Affected Party will use all reasonable efforts to transfer
all of its rights and obligations under this Agreement in
respect of the Affected Transactions to another of its Offices
or Affiliates (so long as the transferee's obligations under
this Agreement are supported by a Credit Support Document in
such form as shall permit each Rating Agency (as defined in
the Intercreditor Agreement) to issue a Ratings Confirmation
(as defined in the Intercreditor Agreement) unless such
transferee meets the Threshold Rating (as defined in the
Intercreditor Agreement)) so that such Illegality ceases to
exist; (2) if the Affected Party is not able to make such a
transfer within such 10 days, such 10th day (or if such 10th
day is not a Business Day (as defined in the Intercreditor
Agreement), the next succeeding Business Day) will be deemed
to have been effectively designated as an Early Termination
Date in respect of all Affected Transactions; and (3) the
provisions of Section 6(b)(iv) will not apply to such
Illegality."; and
(D) Section 6(d)(ii) shall be amended by deleting the existing
provisions thereof and substituting therefor the following:
"On any Early Termination Date, Party A will make a
termination payment to Party B in an amount equal to the
Termination Amount (as defined in the Confirmation) for such
Early Termination Date for credit to the Class G-1 Above-Cap
Collateral Account (as defined in, and as provided for Section
3.6(f) of, the Intercreditor Agreement) to be applied as set
forth in such Section 3.6(f) plus the amount of all other
unpaid sums due and payable by Party A under this Agreement on
or prior to such Early Termination Date and upon such payment,
the Transaction evidenced by the Confirmation dated the date
hereof shall terminate."
(4) Section 7 is amended by adding thereto a new penultimate sentence
reading as follows: "Any purported transfer under Section 6(b) or
this Section 7 shall require Ratings Confirmation (as defined in the
Intercreditor Agreement)".
(5) Section 9(b) is amended by adding thereto a new sentence reading as
follows: "In addition, no amendment, modification or waiver in
respect of this Agreement will be effective unless Ratings
Confirmation (as defined in the Intercreditor Agreement) is
received".
(G) LIMITATION OF LIABILITY. The obligations of Party B under this Agreement,
and in respect of the Transaction evidenced by any Confirmation, are expressly
limited to the extent of funds, if any, made available for such payment to Party
B under, and in accordance with, the priorities of payments set forth in
Sections 2.4(b), 3.2, 3.3 and 3.6 of the Intercreditor Agreement. No recourse
under any obligation, covenant or agreement of Party B contained in this
Agreement or any Confirmation shall be had against any incorporator,
stockholder, agent, affiliate, officer, employee or trustee of Party B, as such,
by the enforcement of any assessment or by any legal or equitable proceeding, by
virtue of any statute or otherwise; it being expressly agreed and understood
that the agreements of Party B contained in this Agreement or any Confirmation
are solely trust obligations of Party B and that no personal liability
whatsoever shall attach to or be incurred by the incorporators, stockholders,
agents, affiliates, officers, employees or trustees of Party B, as such, or any
of them, under or by reason of any of the obligations, covenants or agreements
of Party B contained in this Agreement or any Confirmation and that any and all
personal liability of every such incorporator, stockholder, agent, affiliate,
officer, employee or trustee of Party B for breaches by Party B of any such
obligation, covenant or agreement, which liability may arise either at common
law or at equity, by statute or constitution, or otherwise, is hereby expressly
waived as a condition of and in consideration for the execution of this
Agreement; PROVIDED, HOWEVER, that nothing in this paragraph shall relieve any
of the foregoing persons from any liability which any such person may otherwise
have for his/her or its gross negligence or willful misconduct.
(H) ELIGIBLE CONTRACT PARTICIPANT. For purposes of Section 3, the following
shall be added, immediately following paragraph (f) thereto:
(i) It is an "eligible contract participant" as such term is defined in
Section 1a(12) of the Commodity Exchange Act, as amended (7 U.S.C.
1a(12)) and this Agreement and the Confirmation is subject to
individual negotiation.
(ii) It has entered into this Agreement (including each Transaction
evidenced hereby) in conjunction with its line of business
(including financial intermediation services) or the financing of
its business.
(I) SINGLE TRANSACTION. Party A and Party B each agree and acknowledge that the
only Transaction that is or will be governed by this Agreement is the
Transaction evidenced by the Confirmation dated the date hereof.
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
MERRILL LYNCH CAPITAL SERVICES, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Date:
------------------
WILMINGTON TRUST COMPANY,
in its capacity as Subordination Agent on
behalf of the Trustee under the Class G-1
Trust Agreement
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Date:
------------------
Date: March 25, 2002
To: Wilmington Trust Company
One Rodney Square
1100 N. Market Street
Wilmington, Delaware 19890-0001
Attn: Monica Henry
From: Merrill Lynch Capital Services, Inc.
Merrill Lynch World Headquarters
4 World Financial Plaza, 18th Floor
New York, New York 10080
Attn: Swap Group - Jennifer Hillman
Telephone: (212) 449-6634
Telecopy: (646) 805-0218
Subject: CLASS G-1 ABOVE CAP LIQUIDITY FACILITY CONFIRMATION
Ladies and Gentlemen:
The purpose of this letter agreement (this "Confirmation") is to confirm
the terms and conditions of the Interest Rate Cap Transaction entered into on
the Trade Date referred to in Paragraph 2 below (the "Transaction") between
Merrill Lynch Capital Services, Inc. ("Party A") and Wilmington Trust Company
("Party B"), in its capacity as Subordination Agent on behalf of the Trustee
under the Pass Through Trust Agreement dated as of September 25, 1997 between
Wilmington Trust Company and Continental Airlines, Inc., as supplemented by the
Supplement No. 2002-1G-1-O dated as of March 25, 2002. This letter agreement
constitutes a "Confirmation" as referred to in the ISDA Master Agreement
specified below.
1. The definitions and provisions contained in the 2000 ISDA Definitions and
Annex to the 2000 ISDA Definitions (June 2000 Version) as published by the
International Swaps and Derivatives Association, Inc. (as so supplemented,
the "Definitions") are incorporated into this Confirmation. In the event
of any inconsistency between the Definitions and this Confirmation, this
Confirmation will govern. References herein to a "Transaction" shall be
deemed to be references to a "Swap Transaction" for the purposes of the
Definitions.
This Confirmation supplements, forms a part of, and is subject to the 1992
ISDA Master Agreement (Multicurrency - Cross Border) including the
Schedule thereto, dated as of March 25, 2002, as amended and supplemented
from time to time (collectively, the "Agreement"), between us. All
provisions contained in the Agreement govern this Confirmation except as
modified below. In the event of any inconsistency between the Agreement
and this Confirmation, this Confirmation will govern. Capitalized terms
not otherwise defined in the Agreement or this Confirmation shall have the
meanings ascribed to them in the Intercreditor Agreement dated as of March
25, 2002 among Wilmington Trust Company, as Trustee under the Continental
Airlines Pass Through Trust 2002-1G-1, Continental Airlines Pass Through
Trust 2002-1G-2, Continental Airlines Pass Through Trust 2002-1H and
Continental Airlines Pass Through Trust 2002-1I, Landesbank
Hessen-Thuringen Girozentrale, as Class G-1 Primary Liquidity Provider and
Class G-2 Primary Liquidity Provider, Merrill Lynch Capital Services,
Inc., as Class G-1 Above-Cap Liquidity Provider, Ambac Assurance
Corporation, as Policy Provider, and Wilmington Trust Company, as
Subordination Agent and Trustee (the "Intercreditor Agreement"). The
Agreement and each Confirmation will be governed by and construed in
accordance with the laws of the State of New York.
Each of Party A and Party B represents to the other that it has entered
into this Transaction in reliance upon such independent accounting,
regulatory, legal, tax and financial advice as it deems necessary and not
upon any view expressed by the other.
2. Party A and Party B by this Confirmation are entering into a Transaction
(the "Above Cap Liquidity Facility") that provides an irrevocable interest
rate cap. The terms of the Above Cap Liquidity Facility are as follows:
General Terms:
Transaction Type: Interest Rate Cap Transaction
Notional Amount: The Pool Balance for the Class G-1
Certificates, before giving effect to
any distributions on such Certificates
on any Floating Rate Payer Payment Date
Trade Date: March 22, 2002
Effective Date: March 25, 2002
Termination Date: The first Business Day following the
earlier of (i) the Final Legal
Distribution Date of the Class G-1
Certificates and (ii) the date upon
which the Pool Balance of the Class G-1
Certificates equals zero
Currency Unit: USD
Business Day Convention: Following
Fixed Amounts:
Fixed Amount Payer: Party B
Fixed Amount Payer Payment Date: March 25, 2002
Fixed Amount: As set forth in a separate letter
agreement between Party A and Party B
Floating Amounts:
Floating Rate Payer: Party A
Floating Amount: On each Floating Rate Payer Payment
Date, the Floating Amount shall be
calculated as follows:
(i) in the event that the Interest
Shortfall (as defined in Paragraph 5
below) is equal to zero, the Floating
Amount shall equal zero;
(ii) in the event that there is a
nonzero Interest Shortfall and at least
one of the following is true: (x) the
Available Amount under the Class G-1
Primary Liquidity Facility (before
giving effect to any Interest Advances
to be made on such Payment Date) is
greater than zero, (y) the amount on
deposit in the Class G-1 Cash
Collateral Account (before giving
effect to any withdrawals to be made
from such account on such Payment Date)
is greater than zero, or (z) the amount
on deposit in the Class G-1 Above-Cap
Account (before giving effect to any
withdrawals to be made from such
account on such Payment Date) is
greater than zero, the Floating Amount
shall equal the Above-Cap Payment for
such date; and
(iii) in the event that there is a
nonzero Interest Shortfall and none of
the statements in clauses (ii)(x),
(ii)(y) and (ii)(z) above are true, the
Floating Amount shall equal zero.
Period End Dates: Each February 15, May 15,
August 15 and November 15, commencing
on May 15, 2002 and ending on the
Termination Date, inclusive, subject to
adjustment in accordance with the
Following Business Day Convention.
Floating Rate Payer Payment Dates: Each day that is a Period End Date and
any Special Distribution Date under and
as defined in the Intercreditor
Agreement not coinciding with a Period
End Date on which a distribution of
interest is, by the terms of the
Intercreditor Agreement, to be made on
the Class G-1 Certificates
Floating Rate Option: USD-LIBOR-BBA; PROVIDED, that, if the
relevant rate does not appear on the
Telerate Page 3750, the rate shall be
"LIBOR" as determined by the Reference
Agent under Section 6(b)(ii) of the
Reference Agency Agreement.
Cap Rate: As set forth in Appendix I to this
Confirmation
Designated Maturity: 3 months
Spread: None
Floating Rate Day Count Actual/360
Fraction:
Reset Dates: The first day of the relevant
Calculation Period
Compounding: Inapplicable
Notice: Party B shall, on or before 12:00 Noon
(New York time) on each Floating Rate
Payer Payment Date, provide Party A
with notice of the then-current Pool
Balance and the then-current Interest
Shortfall, if any, together with, if
such a shortfall exists, the
certificate referred to in the
penultimate sentence of Section 3.6(a)
of the Intercreditor Agreement.
3. ROLE OF PARTY A; ROLE OF CALCULATION AGENT
(i) Party B acknowledges that: (a) in connection with this Transaction
and this Agreement, Party A has acted in the capacity of an
arm's-length contractual counterparty and not as its financial
advisor or fiduciary; and (b) in exercising its rights or performing
any of its duties under this Agreement, Party A will act as
principal and not as a fiduciary of Party B.
(ii) Whenever the Calculation Agent is required to act or exercise
judgment in any way, it will do so in good faith and in a
commercially reasonable manner. The calculations and determinations
of the Calculation Agent shall be made in accordance with terms of
this Confirmation having regard in each case to the criteria
stipulated herein and (where relevant) on the basis of information
provided to or obtained by it and such further inquiries as it deems
necessary and will, in the absence of manifest error, be final,
conclusive and binding on Party B and Party A.
4. CREDIT DOWNGRADE OF PARTY A/ INVALIDITY OF GUARANTEE
Notwithstanding any other provisions of this Agreement, within 10 days of
(x) the commencement of any Credit Downgrade Period (as defined in Paragraph
5 below) or (y) the Above-Cap Liquidity Guarantor's guarantee of Party A's
obligations under this Agreement becoming invalid or unenforceable for any
reason (but, in either case, no later than the Termination Date), Party A may,
at its own expense, arrange for one or more Replacement Above-Cap Liquidity
Providers to issue and deliver a Replacement Above-Cap Liquidity Facility to
replace this Above-Cap Liquidity Facility. If Party A does not arrange for such
replacement (and if this Above-Cap Liquidity Facility has not otherwise been
replaced by Continental (at Continental's expense) in accordance with the terms
of Section 3.6(c)(iv) of the Intercreditor Agreement), on such 10th day (or if
such 10th day is not a Business Day, on the next succeeding Business Day)
(which, notwithstanding Section 6(b) of the Agreement, shall be deemed to have
been effectively designated an "Early Termination Date"), Party A shall make a
termination payment to Party B in an amount equal to the Termination Amount for
such Early Termination Date for credit to the Class G-1 Above-Cap Collateral
Account (as provided in Section 3.6(f) of the Intercreditor Agreement) to be
applied as set forth in said Section 3.6(f) plus the amount of all other unpaid
sums due and payable by Party A under this Confirmation on or prior to such
Early Termination Date and upon such payment the Transaction evidenced by this
Confirmation shall terminate. The termination event set forth in this Paragraph
4 shall constitute an "Additional Termination Event" under the Agreement and
Party A shall be the sole "Affected Party" with respect thereto.
5. ADDITIONAL DEFINITIONS
For the purposes of this Confirmation, the following terms shall have the
meanings set forth below:
"BUSINESS DAY" and "LOCAL BUSINESS DAY" mean, with respect to the
Transaction set forth in this Confirmation, "Business Day" as defined in the
Intercreditor Agreement for all purposes under the Agreement.
"CREDIT DOWNGRADE PERIOD" means any continuous period during which the
short-term unsecured debt rating or issuer credit rating, as the case may be, of
Party A (or Above-Cap Liquidity Guarantor) issued by Moody's or Standard &
Poor's is lower than the applicable Threshold Rating.
"INTEREST SHORTFALL" means, on any Floating Rate Payer Payment Date, the
additional amount required in order for Party B to have sufficient funds to pay
interest (calculated at the applicable Stated Interest Rate) due on any Class
G-1 Certificates, before giving effect to any Interest Drawing to be made under
the Class G-1 Primary Liquidity Facility, any withdrawal to be made from the
Class G-1 Cash Collateral Account or the Class G-1 Above-Cap Account, or any
Policy Drawing pursuant to Section 3.7(a) of the Intercreditor Agreement.
"TERMINATION AMOUNT" means, for any Early Termination Date, the amount
obtained by solving the following formula for TA:
TA = (20.00% per annum - CR) x N x F
where
CR = the Cap Rate then in effect
N = the Notional Amount for such date
F = 1.528
For the avoidance of doubt, the Termination Amount shall not exceed $26,745,684
at any time.
6. PAYMENTS
Party A hereby irrevocably instructs Party B to make any payment due to
Party A directly to the account specified below in the name of Party A. Party B
hereby irrevocably instructs Party A to make any payments of Floating Amounts
due to Party B directly to the account(s) specified below in the name of Party
B. All payments by Party A of Floating Amounts due to Party B shall be made
prior to 4:00 p.m. (New York City time) on the date such payment is due without
set-off, deduction, withholding, netting, or any other reduction.
7. ACCOUNT DETAILS
Payments to Party A: Bankers Trust Company
New York, New York
ABA # 021001033
Account No. 00-811-874
Reference: Merrill Lynch Capital Services, Inc.
Dollar Swaps, New York, NY
Payments to Party B: Wilmington Trust Company
ABA # 031100092
Account No. 57767-0
Attention: Monica Henry
Telephone No.: (302) 636-6296
Reference: Continental Airlines PTT,
Series 2002-1G-1
8. OFFICES
The Office of Party A for the Transaction is its office at the address
specified for notices to it in the Schedule to the Agreement. The Office of
Party B for the Transaction is its office at the address specified for notices
to it in the Schedule to the Agreement.
Party A has entered into this transaction as principal. The time at which
the above transaction was executed will be notified to Party B on request.
9. LIMITATION OF LIABILITY. The obligations of Party B under this
Confirmation, and in respect of the Transaction evidenced hereby, are expressly
limited to the extent of funds, if any, made available for such payment to
Party B under, and in accordance with, the priorities of payments set forth in
Sections 2.4(b), 3.2, 3.3 and 3.6 of the Intercreditor Agreement. No recourse
under any obligation, covenant or agreement of Party B contained in this
Confirmation shall be had against any incorporator, stockholder, agent,
affiliate, officer, employee or trustee of Party B, as such, by the enforcement
of any assessment or by any legal or equitable proceeding, by virtue of any
statute or otherwise; it being expressly agreed and understood that the
agreements of Party B contained in this Confirmation are solely trust
obligations of Party B and that no personal liability whatsoever shall attach
to or be incurred by the incorporators, stockholders, agents, affiliates,
officers, employees or trustees of Party B, as such, or any of them, under or
by reason of any of the obligations, covenants or agreements of Party B
contained in this Confirmation and that any and all personal liability of every
such incorporator, stockholder, agent, affiliate, officer, employee or trustee
of Party B for breaches by Party B of any such obligation, covenant or
agreement, which liability may arise either at common law or at equity, by
statute or constitution, or otherwise, is hereby expressly waived as a
condition of and in consideration for the execution of this Confirmation;
PROVIDED, HOWEVER, that nothing in this paragraph shall relieve any of the
foregoing persons from any liability which any such person may otherwise have
for his/her or its gross negligence or willful misconduct.
10. COUNTERPARTS. This Confirmation may be executed in any number of
counterparts and by each party hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same Confirmation.
Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing the copy of this Confirmation enclosed for that purpose
and returning it to us.
Yours sincerely,
MERRILL LYNCH CAPITAL SERVICES, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Confirmed as of the date first written above:
WILMINGTON TRUST COMPANY,
in its capacity as Subordination Agent on behalf
of the Trustee under the Class G-1 Trust Agreement
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
APPENDIX I
* Subject to adjustment in accordance with the
Following Business Day Convention
BEGINNING OF INTEREST PERIOD * CAP RATE
Mar 26, 2002 7.00%
May 15, 2002 7.05%
Aug 15, 2002 7.15%
Nov 15, 2002 7.15%
Feb 15, 2003 7.25%
May 15, 2003 7.25%
Aug 15, 2003 7.40%
Nov 15, 2003 7.40%
Feb 15, 2004 7.60%
May 15, 2004 7.60%
Aug 15, 2004 7.85%
Nov 15, 2004 7.85%
Feb 15, 2005 8.15%
May 15, 2005 8.15%
Aug 15, 2005 8.50%
Nov 15, 2005 8.50%
Feb 15, 2006 8.90%
May 15, 2006 8.90%
Aug 15, 2006 9.35%
Nov 15, 2006 9.35%
Feb 15, 2007 9.85%
May 15, 2007 9.85%
Aug 15, 2007 10.35%
Nov 15, 2007 10.35%
Feb 15, 2008 10.85%
May 15, 2008 10.85%
Aug 15, 2008 11.40%
Nov 15, 2008 11.40%
Feb 15, 2009 12.10%
May 15, 2009 12.10%
Aug 15, 2009 12.65%
Nov 15, 2009 12.65%
Feb 15, 2010 13.35%
May 15, 2010 13.35%
Aug 15, 2010 14.10%
Nov 15, 2010 14.10%
Feb 15, 2011 14.75%
May 15, 2011 14.75%
Aug 15, 2011 15.00%
Nov 15, 2011 15.00%
Feb 15, 2012 15.00%
May 15, 2012 15.00%
Aug 15, 2012 15.00%
Nov 15, 2012 15.00%
Feb 15, 2013 15.00%
May 15, 2013 15.00%
Aug 15, 2013 15.00%
GUARANTEE OF MERRILL LYNCH & CO., INC.
FOR VALUE RECEIVED, receipt of which is hereby acknowledged, MERRILL
LYNCH & CO., INC., a corporation duly organized and existing under the laws of
the State of Delaware ("ML & Co."), hereby unconditionally guarantees to
WILMINGTON TRUST COMPANY, a Delaware corporation, in its capacity as
Subordination Agent on behalf of the Trustee under the Pass Through Trust
Agreement dated as of September 25, 1997 between Wilmington Trust Company and
Continental Airlines, Inc., as supplemented by the Supplement No. 2002-1G-1-O
dated as of March 25, 2002, (the "Company"), the due and punctual payment of any
and all amounts payable by MERRILL LYNCH CAPITAL SERVICES, INC., a corporation
organized under the laws of the State of Delaware ("MLCS"), under the
Transaction evidenced by the Confirmation dated as of March 25, 2002 attached
hereto executed pursuant to the ISDA Master Agreement between the Company and
MLCS, dated as of March 25, 2002 (together with the Schedule and Confirmation
attached thereto the "Agreement"), including, in the case of default, interest
on any amount due, when and as the same shall become due and payable, whether on
the scheduled payment dates, at maturity, upon declaration of termination or
otherwise, according to the terms thereof. In case of the failure of MLCS
punctually to make any such payment, ML & Co. hereby agrees to make such
payment, or cause such payment to be made. The Company agrees to demand payment
from ML & Co., provided, however, that delay by the Company in giving such
demand shall in no event affect ML & Co.'s obligations under this Guarantee.
This Guarantee is a guarantee of payment and not of collection. This Guarantee
shall remain in full force and effect or shall be reinstated (as the case may
be) if at any time any payment guaranteed hereunder, in whole or in part, is
rescinded or must otherwise be returned by the Company upon the insolvency,
bankruptcy or reorganization of MLCS or otherwise, all as though such payment
had not been made.
ML & Co. hereby agrees that its obligations hereunder shall be
absolute and unconditional, irrespective of the (i) validity, regularity or
enforceability of the Agreement; (ii) the absence of any action to enforce the
same; (iii) any waiver or consent by the Company concerning any provisions
thereof; (iv) any amendment of any provision of the Agreement; (v) the rendering
of any judgment against MLCS or any action to enforce the same; (vi) any
insolvency, bankruptcy, reorganization or dissolution, or any proceeding of
MLCS, including without limitation, rejection of MLCS's payment obligations
under the Agreement in such bankruptcy; (vii) any waiver of or consent to any
departure from or failure to enforce any other guarantee for any or all of
MLCS's payment obligations under the Agreement; or (viii) any other
circumstances that might otherwise constitute a legal or equitable discharge of
a guarantor or a defense of a guarantor. ML & Co. covenants that this guarantee
will not be discharged except by complete payment of the amounts payable under
the Agreement. This Guarantee shall continue to be effective if MLCS merges or
consolidates with or into another entity, loses its separate legal identity or
ceases to exist.
ML & Co. hereby agrees that its obligations hereunder shall not be
subject to termination, offset or counterclaim (all of which are expressly
waived by ML & Co.).
ML & Co. hereby waives diligence; presentment; protest; notice of
protest, acceleration, and dishonor; filing of claims with a court in the event
of insolvency or bankruptcy of MLCS; all demands whatsoever; and any right to
require a proceeding first against MLCS.
ML & Co. hereby certifies and warrants that this Guarantee
constitutes the valid obligation of ML & Co. and complies with all applicable
laws.
This Guarantee shall be governed by, and construed in accordance
with, the laws of the State of New York.
This Guarantee becomes effective concurrent with the effectiveness
of the Agreement, according to its terms.
IN WITNESS WHEREOF, ML & Co. has caused this Guarantee to be
executed in its corporate name by its duly authorized representative.
MERRILL LYNCH & CO., INC.
[Execution copy]
AMBAC ASSURANCE CORPORATION,
as Policy Provider,
CONTINENTAL AIRLINES, INC.
and
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as Subordination Agent
INSURANCE AND INDEMNITY AGREEMENT
CONTINENTAL AIRLINES, INC.
PASS THROUGH CERTIFICATES,
SERIES 2002-G-1 and SERIES 2002-G-2
Dated as of March 25, 2002
(This Table of Contents is for convenience of reference only and
shall not be deemed to be part of this Insurance Agreement. All capitalized
terms used in this Insurance Agreement and not otherwise defined shall have the
meanings set forth in Article I of this Insurance Agreement.)
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms................................................2
Section 1.02 Other Definitional Provisions................................7
Section 1.03 Negotiated Document..........................................7
ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 2.01 Representations and Warranties of Continental................8
Section 2.02 Covenants of Continental....................................10
Section 2.03 Representations, Warranties and Covenants of WTC and
Subordination Agent.........................................12
Section 2.04 Representations, Warranties and Covenants of the
Policy Provider.............................................12
ARTICLE III
THE POLICIES; REIMBURSEMENT; INDEMNIFICATION
Section 3.01 Issuance of the Policies....................................14
Section 3.02 Payment of Fees and Premium.................................16
Section 3.03 Reimbursement Obligation....................................17
Section 3.04 Indemnification.............................................18
Section 3.05 Procedure for Payment of Fees and Premiums..................18
Section 3.06 Late Payments...............................................19
ARTICLE IV
FURTHER AGREEMENTS
Section 4.01 Effective Date; Term of the Insurance Agreement.............19
Section 4.02 Further Assurances and Corrective Instruments...............19
Section 4.03 Obligations Absolute........................................19
Section 4.04 Assignments; Reinsurance; Third-Party Rights................21
Section 4.05 Liability of the Policy Provider............................21
ARTICLE V
MISCELLANEOUS
Section 5.01 Amendments, Etc.............................................22
Section 5.02 Notices.....................................................22
Section 5.03 Severability................................................23
Section 5.04 Governing Law...............................................23
Section 5.05 Consent to Jurisdiction.....................................23
Section 5.06 Consent of Policy Provider..................................24
Section 5.07 Counterparts................................................24
Section 5.08 Headings....................................................24
Section 5.09 Trial by Jury Waived........................................24
Section 5.10 Limited Liability...........................................24
Section 5.11 Entire Agreement............................................25
INSURANCE AND INDEMNITY AGREEMENT (as may be amended, modified or
supplemented from time to time, this "Insurance Agreement"), dated as of March
25, 2002, by and among AMBAC ASSURANCE CORPORATION, as Policy Provider (the
"Policy Provider"), CONTINENTAL AIRLINES, INC. ("Continental") and WILMINGTON
TRUST COMPANY, not in its individual capacity but solely as Subordination Agent
(the "Subordination Agent").
W I T N E S S E T H :
WHEREAS, Continental intends to finance (or refinance) the
acquisition of up to seven Aircraft through separate secured loan Transactions
in which Continental will own the Aircraft;
WHEREAS, in the case of each Aircraft, Continental will issue
pursuant to an Indenture, on a recourse basis, three or more series of Equipment
Notes to finance a portion of the purchase price of such Aircraft;
WHEREAS, WTC, not in its individual capacity but as Trustee under
each of the Class G-1 Trust Agreement and Class G-2 Trust Agreement, will create
the Class G-1 Trust and Class G-2 Trust, which will acquire the Series G-1
Equipment Notes and Series G-2 Equipment Notes, respectively, under the Note
Purchase Agreement;
WHEREAS, (i) Landesbank Hessen-Thuringen Girozentrale, as Primary
Liquidity Provider, has entered into two Primary Liquidity Facilities, one each
for the benefit of the Class G-1 Certificateholders and Class G-2
Certificateholders (together, the "Class G Certificateholders") with WTC, as the
Subordination Agent, as agent and Trustee for the applicable Trust, and (ii)
Merrill Lynch Capital Services, Inc., as Class G-1 Above-Cap Liquidity Provider,
has entered into an irrevocable interest rate cap agreement for the benefit of
the Class G-1 Certificateholders with WTC, as the Subordination Agent, as agent
and Trustee of the Class G-1 Trust and (iii) WTC, as Trustee of each Trust, the
Primary Liquidity Provider, the Class G-1 Above-Cap Liquidity Provider, Policy
Provider and the Subordination Agent have entered into the Intercreditor
Agreement;
WHEREAS, pursuant to the Class G-1 Trust Agreement and Class G-2
Trust Agreement (together, the "Class G Trust Agreements"), the Class G-1 Trust
and Class G-2 Trust have been created to facilitate the sale of the Class G-1
Certificates and Class G-2 Certificates (together, the "Class G Certificates");
WHEREAS, the Policy Provider has issued the Class G-1 Policy
in respect of the Class G-1 Certificates and the Class G-2 Policy in respect of
the Class G-2 Certificates, pursuant to which it has agreed to guarantee the
payment of interest to the Subordination Agent for the benefit of the Class G-1
Trustee and Class G-1 Certificateholders, on the one hand, and the Class G-2
Trustee and Class G-2 Certificateholders, on the other hand, and the payment of
principal of the Class G-1 Certificates and the Class G-2 Certificates on the
Final Legal Distribution Date and as otherwise provided herein;
WHEREAS, the Policy Provider shall be paid the Premium as set forth
herein; and
WHEREAS, each of Continental and the Subordination Agent has agreed
to undertake certain obligations in consideration for the Policy Provider's
issuance of the Policies.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINED TERMS. Unless the context clearly requires
otherwise, all capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Intercreditor Agreement or, if not
defined therein, in the Policies described below. For purposes of this Insurance
Agreement, the following terms shall have the following meanings:
"ACT" means Part A of subtitle VII of Title 49, United States Code.
"AIRCRAFT" means any aircraft which is or will be part of the
Collateral.
"AIRCRAFT DOCUMENT" means all technical data, manuals, and log
books, and all inspection, modification, and overhaul records and other service,
repair, maintenance, and technical records that the relevant Aviation Authority
requires be maintained with respect to the Aircraft, including all required
additions, renewals, revisions, and replacements of any such materials required
by the relevant Aviation Authority Regulations, in each case in whatever form
and by whatever means or medium (including microfiche, microfilm, paper, or
computer disk) such materials are maintained or retained by or on behalf of
Continental (provided, that all such materials shall be maintained in the
English language).
"AIRFRAME" means any airframe which is or will be part of the
Collateral.
"APPRAISED VALUE" means the Appraised Value of an Aircraft as set
forth in the Offering Document under the heading "Description of the Aircraft
and the Appraisals - The Appraisals."
"AVIATION AUTHORITY" means the FAA or, if the Aircraft is registered
with any other Government Entity in accordance with the applicable Participation
Agreement, such other Government Entity.
"BANKRUPTCY CODE" means the United States Bankruptcy Code, 11 U.S.C.
Section 101 et seq.
"CITIZEN OF THE UNITED STATES" is defined in Section 40102(a)(15) of
the Act and in the FAA Regulations.
"CLASS G-1 POLICY" means the Certificate Guaranty Insurance Policy
No. AB0542BE, together with all endorsements thereto, issued by the Policy
Provider in favor of the Subordination Agent for the benefit of the Class G-1
Certificateholders and the Class G-1 Primary Liquidity Provider to the extent
provided therein.
"CLASS G-2 POLICY" means the Certificate Guaranty Insurance Policy
No. AB0543BE, together with all endorsements thereto, issued by the Policy
Provider in favor of the Subordination Agent for the benefit of the Class G-2
Certificateholders and the Class G-2 Primary Liquidity Provider to the extent
provided therein.
"CLASS G-1 POLICY FEE LETTER" means the fee letter, dated as of
March 25, 2002, between the Policy Provider and Continental setting forth the
Premium in respect of the Class G-1 Certificates and certain other amounts
payable in respect of the Class G-1 Policy.
"CLASS G-2 POLICY FEE LETTER" means the fee letter, dated as of
March 25, 2002, between the Policy Provider and Continental setting forth the
Premium in respect of the Class G-2 Certificates and certain other amounts
payable in respect of the Class G-2 Policy.
"COLLATERAL" means the "Collateral" as defined or to be defined in
any Indenture with respect to an Aircraft.
"DELIVERY DATE" means with respect to each Participation Agreement,
the "Closing Date" as defined or to be defined in each such Participation
Agreement.
"DEPOSITORY INFORMATION" means the information pertaining to the
Depository under the caption "Description of the Deposit Agreements-Depository"
in the Offering Document.
"DEPRECIATED AIRCRAFT VALUE" means the initial Appraised Value of
each Aircraft, as reduced by 3% of the initial Appraised Value of such Aircraft
per annum on each anniversary date of the initial delivery of such Aircraft to
Continental.
"ENGINE" means any engine which is or will be part of the
Collateral.
"EXPENSES" means any and all liabilities, obligations, losses,
damages, settlements, penalties, claims, actions, suits, costs, expenses and
disbursements (including, without limitation, reasonable fees and disbursements
of legal counsel, accountants, appraisers, inspectors or other professionals,
and costs of investigation).
"EVENT OF LOSS" means any Event of Loss defined or to be defined in
any Indenture.
"FAA" means the Federal Aviation Administration of the United States
of America or any Government Entity succeeding to the functions of the Federal
Aviation Administration.
"FAA FILED DOCUMENTS" with respect to each Aircraft has the meaning
given to such term in the related Indenture.
"FAA REGULATIONS" with respect to each Aircraft has the meaning
given to the term in the related Indenture.
"FINAL LEGAL DISTRIBUTION DATE" means February 15, 2013 with respect
to the Class G-1 Certificates and August 15, 2013 with respect to the Class G-2
Certificates.
"FINANCING STATEMENTS" means collectively, UCC-1 (and, where
appropriate, UCC-3) financing statements covering in respect of each Aircraft,
the related Collateral, showing Mortgagee as secured party, for filing in
Delaware and each other jurisdiction in which such filing is made on or before
the related Delivery Date.
"GAAP" means generally accepted accounting principles as set forth
in the statements of financial accounting standards issued by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants, as such principles may at any time or from time to time be varied
by any applicable financial accounting rules or regulations issued by the SEC
and, with respect to any Person, shall mean such principles applied on a basis
consistent with prior periods except as may be disclosed in such Person's
financial statements.
"GOVERNMENT ENTITY" means (i) any federal, state, provincial, local,
municipal or similar government, and any body, board, department, commission,
court, tribunal, authority, agency or other instrumentality of any such
government or otherwise exercising any executive, legislative, judicial,
administrative or regulatory functions of such government or (ii) any other
government entity having jurisdiction over any matter contemplated by the
Operative Agreements or relating to the observance or performance of the
obligations of any of the parties to the Operative Agreements.
"HOLDER" has the meaning given such term in the Policies.
"INSURANCE AGREEMENT" has the meaning given such term in the initial
paragraph hereof.
"INTERCREDITOR AGREEMENT" means the Intercreditor Agreement
(2002-1), dated as the date hereof, by and among WTC, as Trustee under each of
the Trusts, the Primary Liquidity Provider, the Class G-1 Above-Cap Liquidity
Provider, the Policy Provider and the Subordination Agent.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.
"LATE PAYMENT RATE" shall mean with respect to any period, a rate
per annum equal to LIBOR (as determined pursuant to the Reference Agency
Agreement) plus 2%.
"LAW" means (i) any constitution, treaty, statute, law, decree,
regulation, order, rule or directive of any Government Entity, and (ii) any
judicial or administrative interpretation or application of, or decision under,
any of the foregoing.
"LIEN" means any mortgage, pledge, lien, charge, encumbrance or
security interest affecting the title to or any interest in property.
"MATERIAL ADVERSE CHANGE" means, in respect of any Person as at any
date, a material adverse change in the ability of such Person to perform its
obligations under any of the Operative Agreements to which it is a party as of
such date, or any material adverse change in the business, financial condition
or results of operations of such Person on a consolidated basis with its
subsidiaries.
"MOODY'S" means Moody's Investors Service, Inc., and any successor
thereto.
"MORTGAGEE" with respect to each Aircraft means WTC in its capacity
as Mortgagee under the related Indenture.
"OFFER DATE" means March 11, 2002.
"OFFERING DOCUMENT" means the prospectus, dated August 23, 2001,
including all documents incorporated therein by reference, as supplemented by
the final prospectus supplement, dated March 11, 2002, relating to the offering
of the Class G Certificates, as amended and supplemented. "OPERATIVE AGREEMENTS"
means this Insurance Agreement, the Intercreditor Agreement, each Participation
Agreement, the Note Purchase Agreement, each Indenture, the Series G-1 Equipment
Notes, the Series G-2 Equipment Notes, the Class G Certificates, the Liquidity
Facilities, the Class G Trust Agreements, the Underwriting Agreement, the
Policies and the Policy Fee Letters, together with all exhibits and schedules
included with any of the foregoing.
"PERSON" means an individual, joint stock company, trust,
unincorporated association, joint venture, limited liability company,
corporation, business or owner trust, partnership or other organization or
entity (whether governmental or private).
"POLICIES" means the Class G-1 Policy and Class G-2 Policy.
"POLICY FEE LETTERS" means the Class G-1 Policy Fee Letter and Class
G-2 Policy Fee Letter.
"POLICY PROVIDER" means Ambac Assurance Corporation, or any
successor thereto, as issuer of the Policies.
"POLICY PROVIDER INFORMATION" means the information set forth (or
incorporated by reference) under the caption "Description of the Policy
Provider" in the Offering Document.
"PREMIUM" means the premium payable in respect of the Policies on
the Closing Date and on each Semi-Annual Distribution Date thereafter in an
amount equal to 1/2 of the product of (i) the Premium Percentage and (ii) with
respect to the payment to be made on the Closing Date, the Pool Balance of the
Class G Certificates on the Closing Date, or with respect to the payments to be
made on each Semi-Annual Distribution Date, the Pool Balance of the Class G
Certificates on such Semi-Annual Distribution Date after giving effect to any
distributions to be made on such Semi-Annual Distribution Date; PROVIDED,
HOWEVER, the Premium payable on the Closing Date shall be pro rated from the
Closing Date to the first Semi-Annual Distribution Date (based upon a 360 day
year of twelve 30 day months).
"PREMIUM PERCENTAGE" shall have the meaning set forth in the Policy
Fee Letters.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., and any successor thereto.
"SEC" means the Securities and Exchange Commission of the United
States of America, or any successor thereto.
"SECTION 1110" means 11 U.S.C. ss.1110 of the Bankruptcy Code or any
successor or analogous section of the federal bankruptcy law in effect from time
to time.
"SECURITIES ACT" means the Securities Act of 1933, including, unless
the context otherwise requires, the rules and regulations thereunder, as amended
from time to time.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.
"SECURITY" means a "security" as defined in Section 2(a)(1) of the
Securities Act.
"SEMI-ANNUAL DISTRIBUTION DATE" means each February 15 and August 15
Regular Distribution Date.
"SERIES G-1 EQUIPMENT NOTES" means the Series G-1 Equipment Notes
issued pursuant to any Indenture by Continental, and authenticated by the
Mortgagee thereunder, and any Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"SERIES G-2 EQUIPMENT NOTES" means the Series G-2 Equipment Notes
issued pursuant to any Indenture by Continental, and authenticated by the
Mortgagee thereunder, and any Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"TAXING AUTHORITY" means any federal, state, or local government or
other taxing authority in the United States or its possessions, any foreign
government or political subdivision or taxing authority thereof, any
international taxing authority, or any territory or possession of the United
States or taxing authority thereof.
"TRANSACTIONS" means the transactions contemplated by the Operative
Agreements.
"UCC" means the Uniform Commercial Code as in effect in any
applicable jurisdiction.
"UNDERWRITERS" means Credit Suisse First Boston Corporation, Salomon
Smith Barney Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P.
Morgan Securities Inc. and Morgan Stanley & Co. Incorporated.
"UNDERWRITERS INFORMATION" means the information provided by the
Underwriters in writing specifically for inclusion in the Offering Document, as
revised from time to time, and as included in such Offering Document.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated
March 11, 2002, among the Underwriters, the Depositary and Continental, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"U.S. AIR CARRIER" means any United States air carrier that is a
Citizen of the United States holding an air carrier operating certificate
pursuant to the Act for aircraft capable of carrying 10 or more individuals or
6000 pounds or more of cargo, and as to which there is in force an air carrier
operating certificate issued pursuant to Part 121 of the FAA Regulations, or
which may operate as an air carrier by certification or otherwise under any
successor or substitute provisions therefor or in the absence thereof.
"WTC" means Wilmington Trust Company, a Delaware banking
corporation.
SECTION 1.02 OTHER DEFINITIONAL PROVISIONS. The words "hereof,"
"herein" and "hereunder" and words of similar import when used in this Insurance
Agreement shall refer to this Insurance Agreement as a whole and not to any
particular provision of this Insurance Agreement. Section, subsection, Schedule
and Exhibit references are to this Insurance Agreement unless otherwise
specified. The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms. The words
"include" and "including" shall be deemed to be followed by the phrase "without
limitation."
SECTION 1.03 NEGOTIATED DOCUMENT. This Insurance Agreement is the
result of negotiations among and has been reviewed by the parties hereto and
their respective counsel. Accordingly, this Insurance Agreement shall be deemed
to be the product of all parties hereto, and no ambiguity shall be construed in
favor of or against any such party on the grounds that a particular party was
the drafter or author of this Insurance Agreement or any part thereof.
Accordingly, in any dispute concerning the meaning of the Insurance Agreement,
or any term or condition hereof, such dispute shall be resolved without
reference to the doctrine of CONTRA PROFERENTEM or any related or similar
doctrine.
ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 2.01 REPRESENTATIONS AND WARRANTIES OF CONTINENTAL.
Continental represents and warrants as of the Closing Date as follows:
(a) ORGANIZATION; QUALIFICATION. Continental is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware and has the corporate power and authority to conduct its business in
which it is currently engaged and to own or hold under lease its properties and
to enter into and perform its obligations under the Operative Agreements to
which it is a party as of such date. Continental is duly qualified to do
business as a foreign corporation in good standing in each jurisdiction in which
the nature and extent of the business conducted by it, or the ownership of its
properties, requires such qualification, except where the failure to be so
qualified would not give rise to a Material Adverse Change to Continental.
(b) CORPORATE AUTHORIZATION. Continental has taken, or caused to be
taken, all necessary corporate action (including, without limitation, the
obtaining of any consent or approval of stockholders required by its certificate
of incorporation or by-laws) to authorize the execution and delivery of each of
the Operative Agreements to which it is a party as of such date, and the
performance of its obligations thereunder.
(c) NO VIOLATION. The execution and delivery by Continental of the
Operative Agreements to which it is a party as of such date, the performance by
Continental of its obligations thereunder and the consummation by Continental of
the Transactions contemplated thereby, do not and will not (a) violate any
provision of the certificate of incorporation or by-laws of Continental, (b)
violate any law, regulation, rule or order applicable to or binding on
Continental or (c) violate or constitute any default under (other than any
violation or default that would not result in a Material Adverse Change to
Continental), or result in the creation of any Lien (other than as permitted
under the related Indenture) upon the Aircraft under, any indenture, mortgage,
chattel mortgage, deed of trust, conditional sales contract, lease, loan or
other material agreement, instrument or document to which Continental is a party
or by which it or any of its properties is bound.
(d) APPROVALS. The execution and delivery by Continental of the
Operative Agreements to which it is a party as of such date, the performance by
Continental of its respective obligations thereunder and the consummation by
Continental of the Transactions contemplated thereby do not and will not require
the consent or approval of, or the giving of notice to, or the registration
with, or the recording or filing of any documents with, or the taking of any
other action in respect of, (a) any trustee or other creditor of Continental and
(b) any Government Entity, other than the filing of (w) the FAA Filed Documents
and the Financing Statements (and continuation statements periodically), (x)
filings, recordings, notices or other ministerial actions pursuant to any
routine recording, contractual or regulatory requirements applicable to it, (y)
filings, recordings, notices or other actions contemplated by the Operative
Agreements in connection with the subleasing or reregistration of the Aircraft
and (z) filings, recordings, notices or other actions relating to the Securities
Act or state securities laws.
(e) VALID AND BINDING AGREEMENTS. The Operative Agreements executed
and delivered by Continental on or prior to such date have been duly executed
and delivered by Continental and, assuming the due authorization, execution and
delivery thereof by the other party or parties thereto, constitute the legal,
valid and binding obligations of Continental and are enforceable against
Continental in accordance with the respective terms thereof, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar laws affecting the rights of
creditors generally and general principles of equity, whether considered in a
proceeding at law or in equity and subject to principles of public policy
limiting the right to enforce the indemnification and contribution provisions
contained herein, insofar as such provisions relate to indemnification or
contribution for liabilities arising under federal securities laws.
(f) LITIGATION. Except as set forth in the Offering Document, the
most recent Annual Report on Form 10-K, as amended, of Continental filed with
the SEC on or prior to the Closing Date, or in any Quarterly Report on Form 10-Q
or Current Report on Form 8-K filed by Continental with the SEC subsequent to
such Form 10-K, no action, claim or proceeding is now pending or, to the actual
knowledge of Continental, threatened against Continental before any court,
governmental body, arbitration board, tribunal or administrative agency, which
is reasonably likely to be determined adversely to Continental and if determined
adversely to Continental is reasonably likely to result in a Material Adverse
Change to Continental.
(g) FINANCIAL CONDITION. The audited consolidated balance sheet of
Continental as of December 31, 2001 included in Continental's Annual Report for
the fiscal year ending December 31, 2001 on Form 10-K, as amended, filed by
Continental with the SEC, and the related consolidated statements of operations
and cash flows for the fiscal year then ended, have been prepared in conformity
with GAAP and present fairly in all material respects the consolidated financial
condition of Continental and its consolidated subsidiaries as of such dates and
their consolidated results of operations and cash flows for such periods. Since
December 31, 2001, there has been no material adverse change in the financial
condition or operations of Continental, except as disclosed in the Offering
Document, the foregoing SEC filings or any Current Report on Form 8-K filed by
Continental with the SEC since December 31, 2001.
(h) REGISTRATION AND RECORDATION. In the case of each Aircraft,
except for (a) the registration of such Aircraft with the FAA pursuant to the
Act in the name of Continental, (b) the filing for recordation (and recordation)
of the FAA Filed Documents with respect to such Aircraft, (c) the filing of the
Financing Statements (and continuation statements relating thereto at periodic
intervals) with respect to such Aircraft, and (d) the affixation of the
nameplates referred to in Section 4.02(f) of the Indenture with respect to such
Aircraft at the Delivery Date with respect to such Aircraft, no further action,
including any filing or recording of any document (including any financing
statement in respect thereof under Article 9 of the UCC), is necessary in order
to establish and perfect the Mortgagee's perfected security interest in such
Aircraft (subject only to Permitted Liens as defined in the related Indenture),
as against Continental and any other Person, in each case, in any applicable
jurisdiction in the United States.
(i) NO DEFAULT. No event exists that, in respect of any Aircraft
delivered on the date hereof, constitutes an Event of Default (as defined in the
Indenture for such Aircraft).
(j) NO EVENT OF LOSS. No Event of Loss has occurred with respect to
any Airframe or any Engine which is Collateral under any Indenture executed on
the date hereof, and to the actual knowledge of Continental, no circumstance,
condition, act or event has occurred that, with the giving of notice or lapse of
time or both gives rise to or constitutes an Event of Loss with respect to such
Airframe or any such Engine.
(k) COMPLIANCE WITH LAWS.
(a) Continental is a Citizen of the United States and a U.S.
Air Carrier.
(b) Continental holds all licenses, permits and franchises
from the appropriate Government Entities necessary to authorize
Continental to lawfully engage in air transportation and to carry on
scheduled commercial passenger service as currently conducted,
except where the failure to so hold any such license, permit or
franchise would not give rise to a Material Adverse Change to
Continental.
(c) Continental is not an "investment company" or a company
controlled by an "investment company" within the meaning of the
Investment Company Act.
(l) SECURITIES LAWS. Neither Continental nor any Person authorized
to act on its behalf has directly or indirectly offered any beneficial interest
or Security relating to the ownership of the Aircraft, or any of the Equipment
Notes or any other interest in or security under any Indenture, for sale, to, or
solicited any offer to acquire any such interest or security from, or has sold
any such interest or security to, any Person in violation of the Securities Act.
(m) OFFERING DOCUMENT. Except for the Policy Provider Information,
the Depository Information and the Underwriters Information, the Offering
Document on the Offer Date, and as of the Closing Date, neither contained or
will contain any untrue statement of a material fact nor omitted or will omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(n) SECTION 1110. The Mortgagee under each Indenture will be
entitled to the benefits of Section 1110 with respect to the Aircraft subject to
such Indenture (as in effect on the Delivery Date for such Aircraft) in the
event of a case under Chapter 11 of the Bankruptcy Code in which Continental is
a debtor.
SECTION 2.02 COVENANTS OF CONTINENTAL. Continental covenants and
agrees with the Policy Provider as follows:
(a) Without the prior written consent of the Policy Provider (which
may be granted or withheld in its sole discretion), each Participation Agreement
and the other Financing Agreements (as defined in the Note Purchase Agreement)
to be entered into pursuant to such Participation Agreement (i) will not vary
the Mandatory Economic Terms and will contain the Mandatory Document Terms in
the form attached to the Note Purchase Agreement without modification in any
adverse respect (without regard to the materiality thereof) as regards the
interests, rights and remedies of the Policy Provider, notwithstanding the
provisions in the Note Purchase Agreement permitting such modifications to be
made if the effect thereof is not materially adverse to certain parties and
(iii) will not make any modification of any kind (without regard to the
materiality thereof or whether such modification has any adverse effect on the
interests, rights and remedies of the Policy Provider) to the terms and
provisions set forth on Schedule I attached hereto.
(b) Notwithstanding the provisions of any Indenture or any other
Operative Agreement and in addition to and not in limitation of any other right
which the Policy Provider may have under any other Operative Agreement,
Continental agrees that the Policy Provider and its representatives may once in
any 24-month period following the issuance of the Class G Certificates, at their
expense, inspect any Aircraft or Aircraft Documents, and may otherwise meet with
the relevant officers and managers of Continental to discuss the affairs,
finances and accounts of Continental, upon reasonable request by the Policy
Provider; PROVIDED that (i) each such inspection or meeting shall be conducted
during times reasonably acceptable to Continental, (ii) each such inspection or
meeting shall be conducted in a manner so as not to interfere with Continental
's (or any Permitted Lessee's (as defined the Indenture)) maintenance and
operation of the Aircraft, (iii) the Policy Provider shall give Continental at
least thirty (30) days notice of its request to inspect any Aircraft or Aircraft
Documents, and (iv) any inspection of the Aircraft hereunder shall be limited to
a visual, walk-around inspection, and shall not include the opening of any
panels, bays, or other components of the Aircraft. Continental will reasonably
cooperate with the Policy Provider in response to each such request by the
Policy Provider.
(c) Anything in the Note Purchase Agreement to the contrary
notwithstanding, without the consent of the Policy Provider, Continental agrees
not to utilize debt in relation to the Aircraft to be financed under the Note
Purchase Agreement such that the principal amount of the Series G-1 Equipment
Notes and Series G-2 Equipment Notes taken together (assuming the amortization
of the Series G-1 Equipment Notes and Series G-2 Equipment Notes taken together
occurs as set forth on the amortization schedule established on the Delivery
Date with respect to such Series G-1 Equipment Notes and Series G-2 Equipment
Notes, or, if such amortization schedule is modified thereafter by amendment of
the applicable Indenture, assuming the amortization of the Series G-1 Equipment
Notes and Series G-2 Equipment Notes taken together occurs as set forth on such
modified amortization schedule), in aggregate or in relation to an individual
Aircraft, as of each Semi-Annual Distribution Date (assuming any amortization
that was scheduled on such date had been paid) referred to below, expressed as a
percentage of the Depreciated Aircraft Value, in aggregate or in relation to an
individual Aircraft, as of such Semi-Annual Distribution Date, would be
scheduled to exceed the applicable percentage set forth in the following
schedule:
SEMI-ANNUAL SCHEDULE A SCHEDULE B
DISTRIBUTION DATE
Initial Date 52.6% 52.9%
August 15, 2002 52.6% 52.9%
February 15, 2003 52.6% 52.9%
- ------------------
* The Initial Date for an individual Aircraft is the Delivery Date of such
Aircraft and the Initial Date for the aggregate of all Aircraft is the Closing
Date.
August 15, 2003 51.5% 51.8%
February 15, 2004 52.0% 52.3%
August 15, 2004 50.5% 50.7%
February 15, 2005 51.0% 51.2%
August 15, 2005 49.4% 49.7%
February 15, 2006 49.9% 50.2%
August 15, 2006 48.3% 48.6%
February 15, 2007 48.8% 49.1%
August 15, 2007 47.2% 47.4%
February 15, 2008 47.7% 48.0%
August 15, 2008 46.1% 46.3%
February 15, 2009 46.6% 46.9%
August 15, 2009 44.9% 45.2%
February 15, 2010 45.5% 45.8%
August 15, 2010 43.8% 44.0%
February 15, 2011 44.4% 44.6%
August 15, 2011 42.6% 42.8%
February 15, 2012 42.6% 42.8%
Schedule A applies in the case of the aggregate of all Aircraft.
Schedule B applies to any individual Aircraft.
(d) Upon request of the Policy Provider (which such request shall
not exceed one time in any applicable calendar year), Continental agrees to
provide to the Policy Provider the name and location of any airline that then
has possession of an Engine (subject to any of the liens under any Indenture)
through a pooling or interchange arrangement or otherwise.
SECTION 2.03 REPRESENTATIONS, WARRANTIES AND COVENANTS OF WTC AND
SUBORDINATION AGENT. Each of WTC and Subordination Agent represents, warrants
and covenants to Continental and the Policy Provider that it shall perform and
observe, in all material respects, all of its respective covenants, obligations
and agreements in any Operative Agreement to which it is a party to be observed
or performed by it.
SECTION 2.04 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE POLICY
PROVIDER. The Policy Provider represents, warrants and covenants to Continental
and the Subordination Agent as follows:
(a) ORGANIZATION AND LICENSING. The Policy Provider is duly
organized, validly existing and in good standing as a Wisconsin-domiciled stock
insurance company, duly qualified to conduct an insurance business in every
jurisdiction where qualification may be necessary to accomplish the
Transactions.
(b) CORPORATE POWER. The Policy Provider has the corporate power and
authority to issue the Policies, to execute and deliver this Insurance Agreement
and the other Operative Agreements to which it is a party and to perform all of
its obligations hereunder and thereunder.
(c) AUTHORIZATION; APPROVALS. All proceedings legally required for
the issuance and execution, delivery and performance of the Policies and the
execution, delivery and performance of this Insurance Agreement have been taken
and all licenses, orders, consents or other authorizations or approvals of any
Government Entity legally required for the enforceability of the Policies have
been obtained; any proceedings not taken and any licenses, authorizations or
approvals not obtained do not affect the enforceability of the Policies.
(d) ENFORCEABILITY. This Insurance Agreement, the Intercreditor
Agreement, the Policy Fee Letters and the Policies, when issued, will
constitute, a legal, valid and binding obligation of the Policy Provider,
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, receivership, moratorium and other similar laws affecting
creditors' rights generally and to general principles of equity and subject to
principles of public policy limiting the right to enforce the indemnification
provisions contained herein, insofar as such provisions relate to
indemnification for liabilities arising under federal securities laws.
(e) FINANCIAL INFORMATION. (i) The consolidated financial statements
of the Policy Provider and its subsidiaries as of December 31, 2000 and December
31, 1999, and for each of the years in the three-year period ended December 31,
2000, prepared in accordance with accounting principles generally accepted in
the United States of America, included in the Annual Report on Form 10-K of
Ambac Financial Group, Inc. (which was filed with the Commission on March 28,
2001, Commission File Number 1-10777); (ii) the unaudited consolidated financial
statements of the Policy Provider and its subsidiaries as of March 31, 2001 and
for the periods ending March 31, 2001 and March 31, 2000 included in the
Quarterly Report on Form 10-Q of Ambac Financial Group, Inc. (which was filed
with the Commission on May 15, 2001); (iii) the unaudited consolidated financial
statements of the Policy Provider and its subsidiaries as of June 30, 2001 and
for the periods ending June 30, 2001 and June 30, 2000 included in the Quarterly
Report on Form 10-Q of Ambac Financial Group, Inc. (which was filed with the
Commission on August 10, 2001); (iv) the unaudited consolidated financial
statements of the Policy Provider and its subsidiaries as of September 30, 2001
for the periods ending September 30, 2001 and September 30, 2000 included in the
Quarterly Report on Form 10-Q of Ambac Financial Group, Inc. (which was filed
with the Commission on November 14, 2001); and (v) the Current Reports on Form
8-K filed with the Commission on January 24, 2001, March 19, 2001, July 23,
2001, September 17, 2001, September 19, 2001, October 22, 2001, December 4, 2001
and January 25, 2002, as such reports related to Ambac, fairly present in all
material respects the financial condition of the Policy Provider as of such
dates and for the periods covered by such statements in accordance with
generally accepted accounting principles consistently applied. Since September
30, 2001, there has been no change in the financial condition or operations of
the Policy Provider that would materially and adversely affect its ability to
perform its obligations under the Policies.
(f) POLICY PROVIDER INFORMATION. The Policy Provider Information is
true and correct in all material respects, did not as of the Offer Date contain
and will not as of the Closing Date contain any untrue statement of a material
fact and did not as of the Offer Date omit and will not as of the Closing Date
omit to state a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading.
(g) NO LITIGATION. There are no actions, suits, proceedings or
investigations pending or, to the best of the Policy Provider's knowledge,
threatened against it at law or in equity or before or by any court,
governmental agency, board or commission or any arbitrator which, if decided
adversely, would materially and adversely affect its ability to perform its
obligations under the Operative Agreements to which it is a party.
(h) COMPLIANCE WITH LAW, ETC. No practice, procedure or policy
employed, or proposed to be employed, by the Policy Provider in the conduct of
its business violates any law, regulation, judgment, agreement, order or decree
applicable to the Policy Provider that, if enforced, could result in a Material
Adverse Change with respect to the Policy Provider.
(i) NO ACCELERATION PAYMENTS. The Policy Provider shall not make any
payment under the Policy except as specifically required in the definition of
"Deficiency Amount" therein and in respect of any "Preference Amount" as defined
in the Policy.
(j) SECURITIES ACT. The issuance of the Policy as described in the
Offering Document is exempt from registration under the Securities Act pursuant
to Section 3(a)(8) thereof.
ARTICLE III
THE POLICIES; REIMBURSEMENT; INDEMNIFICATION
SECTION 3.01 ISSUANCE OF THE POLICIES. The Policy Provider agrees to
issue the Policies on the Closing Date, subject to satisfaction of the
conditions precedent set forth below on or prior to the Closing Date:
(a) OPERATIVE AGREEMENTS. The Policy Provider shall have received a
copy of (i) each of the Operative Agreements, with the exception of the
Policies, required to be executed and delivered on or prior to the Closing Date,
in form and substance reasonably satisfactory to the Policy Provider, duly
authorized, executed and delivered by each party thereto, other than the Policy
Provider, and (ii) a copy of the Offering Document;
(b) CERTIFIED DOCUMENTS AND RESOLUTIONS. The Policy Provider shall
have received (i) a copy of the certificate of incorporation and by-laws of
Continental and (ii) a certificate of the Secretary or Assistant Secretary of
Continental dated the Closing Date stating that attached thereto is a true,
complete and correct copy of resolutions duly adopted by the Board of Directors
of Continental authorizing the execution, delivery and performance by
Continental of the Operative Agreements to which it is a party and the
consummation of the Transactions and that such applicable organizational
documents and resolutions are in full force and effect without amendment or
modification on the Closing Date;
(c) INCUMBENCY CERTIFICATE. The Policy Provider shall have received
a certificate of the Secretary or an Assistant Secretary of each of Continental
and the Subordination Agent certifying the names and signatures of the officers
of Continental and the Subordination Agent, respectively, authorized to execute
and deliver the Operative Agreements to which it is a party on or prior to the
Closing Date;
(d) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Continental and the Subordination Agent set forth in this
Insurance Agreement and the other Operative Documents to which they are a party,
respectively, shall be true and correct on and as of the Closing Date;
(e) DOCUMENTATION. The Policy Provider shall have received a copy of
each document, instrument, certificate and opinion delivered on or before the
Closing Date pursuant to the Operative Agreements, including each opinion of
counsel addressed to any of Moody's, S&P, the Trustee, Continental, the
Subordination Agent and the Underwriters (except for the opinion of counsel to
the Underwriters addressed only to the Underwriters), in respect of Continental
and the Subordination Agent or any of the other parties to the Operative
Agreements and the Transactions dated the Closing Date, in form and substance
reasonably satisfactory to the Policy Provider, addressed to the Policy Provider
(or accompanied by a letter from the counsel rendering such opinion to the
effect that the Policy Provider is entitled to rely on such opinion as of its
date as if it were addressed to the Policy Provider) and addressing such matters
as the Policy Provider may reasonably request (including the opinion of counsel
to Continental in respect to the bankruptcy remoteness of the Deposits), and the
counsel providing each such opinion shall have been instructed by its client to
deliver such opinion to the addressees thereof;
(f) APPROVALS, ETC. The Policy Provider shall have received true and
correct copies of all governmental approvals, licenses and consents, if any,
required in connection with the Transactions;
(g) NO LITIGATION, ETC. No suit, action or other proceeding,
investigation or injunction, or final judgment relating thereto, shall be
pending or threatened before any court, governmental or administrative agency or
arbitrator in which it is sought to restrain or prohibit or to obtain damages or
other relief in connection with any of the Operative Agreements or the
consummation of the Transactions;
(h) LEGALITY. No statute, rule, regulation or order shall have been
enacted, entered or deemed applicable by any government or governmental or
administrative agency or court that would make the Transactions illegal or
otherwise prevent the consummation thereof;
(i) ISSUANCE OF RATINGS. The Policy Provider shall have received
confirmation in writing that the risk insured by the Policies (without regard to
the Policies) is rated no lower than "A" by S&P and "Baa2" by Moody's, the Class
G Certificates, when issued, will be rated "AAA" by S&P and "Aaa" by Moody's and
shall have received confirmation in writing from S&P of a capital charge
acceptable to the Policy Provider as set forth in the financing proposal letter,
dated January 16, 2002, between the Policy Provider and Continental;
(j) SATISFACTORY DOCUMENTATION. The Policy Provider and its counsel
shall have reasonably determined that all documents, certificates and opinions
to be delivered in connection with the Certificates conform to the terms of the
related Trust Agreement, the Offering Document, this Insurance Agreement and the
Intercreditor Agreement;
(k) FILINGS. The Policy Provider shall have received evidence that
there shall have been made and shall be in full force and effect, all filings,
recordings and registrations, and there shall have been given or taken any
notice or similar action as is necessary in order to establish, perfect, protect
and preserve the right, title and interest of the Policy Provider created by the
Operative Agreements executed and delivered on or prior to the Closing Date;
(l) CONDITIONS PRECEDENT. All conditions precedent to the issuance
of the Certificates under the Trust Agreements shall have been satisfied, or
waived with the consent of the Policy Provider. All conditions precedent to the
effectiveness of the Liquidity Facilities shall have been satisfied or waived,
and all conditions precedent to the purchases of the Certificates by the
Underwriters under the Underwriting Agreement shall have been satisfied or
waived by the Underwriters; and
(m) EXPENSES. The Policy Provider shall have received payment in
full of all amounts required to be paid by Continental to or for account of the
Policy Provider on or prior to the Closing Date.
SECTION 3.02 PAYMENT OF FEES AND PREMIUM.
(a) LEGAL FEES. Promptly upon receipt of an invoice, Continental
shall pay or cause to be paid to, or as directed by, the Policy Provider, legal
fees, disbursements and charges incurred by the Policy Provider in connection
with the issuance of the Policies and this Insurance Agreement in accordance
with the Policy Fee Letters. Any additional reasonable fees of the Policy
Provider's counsel or auditors payable in respect of any amendment or supplement
to the Offering Document requested by Continental and incurred after the Closing
Date shall be paid by Continental promptly following receipt of documentation
thereof (but in no event later than thirty days following the receipt of such
documentation).
(b) RATING AGENCY FEES. Continental shall promptly pay the initial
fees of S&P and Moody's with respect to rating the Certificates and the
Transactions following receipt of a statement with respect thereto. All periodic
and subsequent fees of S&P or Moody's with respect to, and directly allocable
to, the Certificates shall be for the account of, and shall be billed to,
Continental. The fees for any other rating agency shall be paid by the party
requesting such other agency's rating unless such other agency is a substitute
for S&P or Moody's in the event that S&P or Moody's is no longer rating the
Certificates, in which case the fees for such agency shall be paid by
Continental.
(c) CONSULTING FEES. Continental shall pay as directed by the Policy
Provider on the Closing Date the cost of consulting services in respect of
valuating the Aircraft performed by Morten Beyer and Agnew, Inc. for the Policy
Provider, not to exceed $1,500 in total.
(d) PREMIUM.
(i) In consideration of the issuance by the Policy Provider of the
Policies, Continental shall pay or cause to be paid to the Policy
Provider, the Premium, PROVIDED that such requirement shall not be
duplicative of any payments in respect of Premiums made in accordance with
Section 6(c) of the Note Purchase Agreement and the provisions of each
Indenture. Continental shall also pay any additional amounts, as and when
due, to be paid by it under the Policy Fee Letters.
(ii) No portion of the Premium paid shall be refundable, without
regard to whether the Policy Provider makes any payment under the Policies
or any other circumstances relating to the Class G Certificates or
provision being made for payment of the Class G Certificates prior to
maturity.
SECTION 3.03 REIMBURSEMENT OBLIGATION.
(a) As and when due in accordance with and from the funds specified
in Sections 2.4(b), 3.2 and 3.3 of the Intercreditor Agreement, the Policy
Provider shall be entitled to reimbursement for any payment made by the Policy
Provider under the Policies to the Subordination Agent or to the Primary
Liquidity Provider under Sections 2.6(c) or 3.7(c) of the Intercreditor
Agreement, which reimbursement shall be due and payable on the date provided in
such Sections, in an amount equal to the amount to be so paid and all amounts
previously paid that remain unreimbursed. In addition, to the extent that any
such payment by the Policy Provider shall have been made as a result of a
default by a Primary Liquidity Provider in its obligation to make an Advance, as
provided in the Intercreditor Agreement, the Policy Provider shall be entitled
to the payment of interest on such amounts to the extent, at the time and in the
priority specified in Sections 2.4(b), 3.2 and 3.3 of the Intercreditor
Agreement.
(b) Upon the occurrence and during the continuance of a Direct
Payment Event, Continental agrees to reimburse the Policy Provider immediately,
upon demand, to the extent of any payment made under the Policies or to the
Subordination Agent or to the Primary Liquidity Provider under Sections 2.6(c)
or 3.7(c) of the Intercreditor Agreement, less any amount in respect of such
payment paid to and received by the Policy Provider pursuant to the Operative
Agreements. Notwithstanding the foregoing, Continental shall not be required to
make any payment to the Policy Provider under this Section 3.03(b)(i) that has
already been received by the Policy Provider pursuant to the Intercreditor
Agreement or (ii) in the case of a Direct Payment Event referred to in clause
(A) of the next sentence, unless Continental has, upon making the payment to the
Policy Provider under this Section 3.03(b), been released and discharged from
its obligation to pay the amount under the Series G-1 and Series G-2 Equipment
Notes and the Indentures that corresponds to the amount for which reimbursement
is demanded under this Section 3.03(b). "Direct Payment Event" shall be deemed
to occur (A) when the following conditions have been simultaneously satisfied:
(i) an Event of Default has occurred under an Indenture and the Series G-1
Equipment Notes or Series G-2 Equipment Notes under such Indenture have not been
sold in connection with the exercise of remedies thereunder or under the
Intercreditor Agreement; and (ii) the Policy Provider has made a payment under
the Policies to the Subordination Agent or to the Primary Liquidity Provider
under Sections 2.6(c) or 3.7(c) of the Intercreditor Agreement with respect to
or caused by the occurrence of an Event of Default under such Indenture or (B)
if, after all Equipment Notes have been paid in full or, to the extent not so
paid, such Equipment Notes have been sold or the Collateral securing such
Equipment Notes has been sold, and such payments and the proceeds of all such
sales have been distributed pursuant to the Intercreditor Agreement, and the
Policy Provider has not received reimbursement of all payments made by it under
the Policies to the Subordination Agent and the Primary Liquidity Provider under
Sections 2.6(c) or 3.7(c) of the Intercreditor Agreement.
(c) Continental agrees to pay to the Policy Provider any and all
charges, fees, costs and expenses that the Policy Provider may reasonably pay or
incur, including reasonable attorneys' and accountants' fees and expenses
(without duplication of amounts paid to the Policy Provider in respect of the
Operative Agreements), in connection with (i) the preservation (in connection
with the occurrence of an Event of Default under any Indenture), enforcement or
defense of any rights in respect of this Insurance Agreement, including
defending, monitoring or participating in any litigation or proceeding and (ii)
any amendment, waiver or other action requested by Continental with respect to,
or related to, any Operative Agreements or to any form document attached to any
Operative Agreement as an exhibit, schedule or annex thereto, whether or not
executed or completed. Provided that three Business Days' written notice of the
intended payment or incurrence shall have been given to Continental by the
Policy Provider, such reimbursement shall be due on the dates on which such
charges, fees, costs or expenses are paid or incurred by the Policy Provider.
(d) The Policy Provider agrees that with respect to any amendment to
a Policy that would increase the reimbursement obligations to the Policy
Provider hereunder above the level set at the Closing Date ("Increased
Obligation Amounts"), reimbursement to the Policy Provider for such Increased
Obligation Amounts shall not be required, unless Continental shall have
consented to such amendment.
SECTION 3.04 INDEMNIFICATION.
(a) Continental agrees (i) that the Policy Provider is hereby
entitled to the full benefit of the General Indemnity and the General Tax
Indemnity contained in the form of Participation Agreement attached to the Note
Purchase Agreement as if such provisions were set forth in full herein, the
Policy Provider were an Indemnitee thereunder and the Operative Agreements
referred to therein include this Insurance Agreement and the Note Purchase
Agreement and (ii) that it shall name the Policy Provider as an Indemnitee in
each Participation Agreement; PROVIDED, HOWEVER, any exclusion contained in any
Participation Agreement or form thereof related to any representation or
warranty by any Indemnitee other than the Policy Provider, the failure by any
Indemnitee other than the Policy Provider to perform or observe any agreement,
covenant or condition in any of the Operative Agreements, the acts or omissions
involving the willful misconduct or gross negligence of any Indemnitee other
than the Policy Provider shall not apply to the indemnification obligations of
Continental to the Policy Provider. In seeking any indemnity under the
Participation Agreement, the Policy Provider agrees to comply with all
obligations of an Indemnitee thereunder.
(b) Notwithstanding any provisions to the contrary, Continental and
the Policy Provider agree that, as between them, Section 8.1.4 of each
Participation Agreement shall read as follows: "If a claim for any Expense that
an Indemnitee shall be indemnified against under this Section 8.1 is made, such
Indemnitee shall give prompt written notice thereof to Owner. Notwithstanding
the foregoing, the failure of any Indemnitee to notify Owner as provided in this
Section 8.1.4, or in Section 8.1.5, shall not release Owner from any of its
obligations to indemnify such Indemnitee hereunder, except to the extent that
such failure materially impairs Owner's ability to contest such claim. If such
failure results in an additional Expense to Owner, Owner shall not be
responsible for such additional expense."
SECTION 3.05 PROCEDURE FOR PAYMENT OF FEES AND PREMIUMS. All
payments to be made to the Policy Provider under this Insurance Agreement shall
be made to the Policy Provider in lawful currency of the United States of
America in immediately available funds on the date when due to such account as
the Policy Provider shall direct by written notice given at least one Business
Day prior to such date to Continental. In the event that the date of any payment
to the Policy Provider or the expiration of any time period hereunder occurs on
a day that is not a Business Day, then such payment shall be made, or such
expiration of time period shall occur, on the next succeeding Business Day with
the same force and effect as if such payment was made or time period expired on
the scheduled date of payment or expiration date, as applicable.
SECTION 3.06 LATE PAYMENTS. If Continental fails to pay the Premium
or any other amounts owing to the Policy Provider under this Insurance Agreement
or the Policy Fee Letters when due, interest on such amount shall be assessed
against, and due and payable by, Continental at the Late Payment Rate from the
date such amount was due until the date such amount is paid.
ARTICLE IV
FURTHER AGREEMENTS
SECTION 4.01 EFFECTIVE DATE; TERM OF THE INSURANCE AGREEMENT. This
Insurance Agreement shall take effect on the Closing Date and shall remain in
effect until the later of (a) such time as the Policy Provider is no longer
subject to a claim under the Policies and the Policies shall have been
surrendered to the Policy Provider for cancellation and (b) all amounts payable
to the Policy Provider by Continental or the Subordination Agent hereunder or
from any other source hereunder or under the Operative Agreements and all
amounts payable under the Class G Certificates have been paid in full; provided,
however, that the provisions of Sections 3.04, 3.05, 3.06, 3.07 and 3.08, hereof
shall survive any termination of this Insurance Agreement.
SECTION 4.02 FURTHER ASSURANCES AND CORRECTIVE INSTRUMENTS.
(a) Neither Continental nor the Subordination Agent shall grant any
waiver of rights or agree to any amendment or modification to any of the
Operative Agreements to which either of them is a party, which waiver,
amendment, or modification would have an adverse effect on the rights or
remedies of the Policy Provider without the prior written consent of the Policy
Provider so long as the Policy Provider shall be the Controlling Party and any
such waiver without prior written consent of the Policy Provider shall be null
and void and of no force or effect.
(b) To the extent permitted by law, each of Continental and the
Subordination Agent agrees that it will, from time to time, execute, acknowledge
and deliver, or cause to be executed, acknowledged and delivered, such
supplements hereto and such further instruments as the Policy Provider may
reasonably request and as may be required to effectuate the intention of or
facilitate the performance of this Insurance Agreement.
SECTION 4.03 OBLIGATIONS ABSOLUTE.
(a) So long as no Policy Provider Default shall have occurred and be
continuing, the obligations of Continental hereunder shall be absolute and
unconditional and shall be paid or performed strictly in accordance with this
Insurance Agreement under all circumstances irrespective of:
(i) any lack of validity or enforceability of, or any amendment or
other modifications of, or waiver, with respect to any of the Operative
Agreements (other than the Policies) or the Certificates;
(ii) any exchange or release of any other obligations hereunder;
(iii) the existence of any claim, setoff, defense, reduction,
abatement or other right that Continental may have at any time against the
Policy Provider or any other Person;
(iv) any document presented in connection with the Policies proving
to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(v) any payment by the Policy Provider under the Policies against
presentation of a certificate or other document that does not strictly
comply with the terms of the Policies;
(vi) any failure of Continental to receive the proceeds from the
sale of the Certificates; and
(vii) any other circumstances, other than payment in full, that
might otherwise constitute a defense available to, or discharge of,
Continental in respect of any Operative Agreements.
(b) So long as no Policy Provider Default shall have occurred and be
continuing and except as expressly provided herein or in any Operative
Agreement, Continental renounces the right to assert as a defense to the
performance of its obligations each of the following: (i) to the extent
permitted by law, any and all redemption and exemption rights and the benefit of
all valuation and appraisement privileges against the indebtedness and
obligations evidenced by any Operative Agreements or by any extension or renewal
thereof; (ii) presentment and demand for payment, notices of nonpayment and of
dishonor, protest of dishonor and notice of protest; (iii) all notices in
connection with the delivery and acceptance hereof and all other notices in
connection with the performance, default or enforcement of any payment
hereunder, except as required by the Operative Agreements; and (iv) all rights
of abatement, diminution, postponement or deduction, and all rights of setoff or
recoupment arising out of any breach under any of the Operative Agreements, by
any party thereto or any beneficiary thereof, or out of any obligation at any
time owing to Continental.
(c) Continental (i) agrees that any consent, waiver or forbearance
hereunder with respect to an event shall operate only for such event and not for
any subsequent event; (ii) consents to any and all extensions of time that may
be granted to Continental by the Policy Provider with respect to any payment
hereunder or other provisions hereof; and (iii) consents to the addition of any
and all other makers, endorsers, guarantors and other obligors for any payment
hereunder, and to the acceptance of any and all other security for any payment
hereunder, and agrees that the addition of any such obligors or security shall
not affect the liability of Continental for any payment hereunder.
(d) No failure by the Policy Provider to exercise, and no delay by
the Policy Provider in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by the Policy Provider of any right hereunder shall not
preclude the exercise of any other right, and the remedies provided herein to
the Policy Provider are declared in every case to be cumulative and not
exclusive of any remedies provided by law or equity.
(e) Nothing herein shall be construed as prohibiting Continental
from pursuing any rights or remedies it may have against any Person in a
separate legal proceeding.
SECTION 4.04 ASSIGNMENTS; REINSURANCE; THIRD-PARTY RIGHTS.
(a) This Insurance Agreement shall be a continuing obligation of the
parties hereto and shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns. The Subordination
Agent, except as provided in Section 8.1 of the Intercreditor Agreement, and
Continental, except for any transaction expressly permitted by Section 5.02 of
the Basic Agreement, may not assign their respective rights under this Insurance
Agreement, or delegate any of their duties hereunder, without the prior written
consent of the other parties hereto. Any assignments made in violation of this
Insurance Agreement shall be null and void.
(b) The Policy Provider shall have the right to grant participations
in its rights under this Insurance Agreement and to enter into contracts of
reinsurance with respect to the Policies upon such terms and conditions as the
Policy Provider may in its discretion determine; PROVIDED, HOWEVER, that no such
participation or reinsurance agreement or arrangement shall relieve the Policy
Provider of any of its obligations hereunder or under the Policies or grant to
any participant or reinsurer any rights hereunder or under any Operative
Agreement or shall result in any increased liability to Continental.
(c) Except as provided herein with respect to participants and
reinsurers, nothing in this Insurance Agreement shall confer any right, remedy
or claim, express or implied, upon any Person, including, particularly, any
Holder, other than upon the Policy Provider against Continental, or upon
Continental against the Policy Provider (either directly or as the Controlling
Party), and all the terms, covenants, conditions, promises and agreements
contained herein shall be for the sole and exclusive benefit of the parties
hereto and their successors and permitted assigns. None of the Subordination
Agent, the Primary Liquidity Provider, the Above-Cap Liquidity Provider, the
Trustee or any Holder shall have any right to payment from the Premium paid or
payable hereunder or from any amounts paid by Continental pursuant to Section
3.02, 3.03, 3.04, 3.05 or 3.06 hereof.
SECTION 4.05 LIABILITY OF THE POLICY PROVIDER. Neither the Policy
Provider nor any of its officers, directors or employees shall be liable or
responsible for: (a) the use that may be made of the Policies by the
Subordination Agent or for any acts or omissions of the Subordination Agent in
connection therewith; or (b) the validity, sufficiency, accuracy or genuineness
of documents delivered to the Policy Provider in connection with any claim under
the Policies, or of any signatures thereon, even if such documents or signatures
should in fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged (unless the Policy Provider shall have actual knowledge
thereof). In furtherance and not in limitation of the foregoing, the Policy
Provider may accept documents that appear on their face to be in order, without
responsibility for further investigation.
ARTICLE V
MISCELLANEOUS
SECTION 5.01 AMENDMENTS, ETC. This Insurance Agreement may be
amended, modified, supplemented or terminated only by written instrument or
written instruments signed by the parties hereto; PROVIDED that if such
amendment, modification, supplement or termination would have a material adverse
affect on the interests of the Subordination Agent, a Pass Through Trustee or
any Certificateholder, Ratings Confirmation shall also be obtained prior to such
amendment, modification, supplement or termination being effective. Continental
agrees to provide a copy of any amendment to this Insurance Agreement promptly
to the Subordination Agent and the Rating Agencies. No act or course of dealing
shall be deemed to constitute an amendment, modification, supplement or
termination hereof.
SECTION 5.02 NOTICES. All demands, notices and other communications
to be given hereunder shall be in writing (except as otherwise specifically
provided herein) and shall be mailed by registered mail or personally delivered
and telecopied to the recipient as follows:
(a) To the Policy Provider:
Ambac Assurance Corporation
One State Street Plaza
New York, New York 10004
Attention: Surveillance Department
Facsimile: (212) 363-1459
Confirmation: (212) 668-0340
In each case in which notice or other communication to the Policy
Provider refers to an event of default under any Operative Agreement, a claim on
the Policies or with respect to which failure on the part of the Policy Provider
to respond shall be deemed to constitute consent or acceptance, then a copy of
such notice or other communication should also be sent to the attention of the
general counsel of each of the Policy Provider at its address set forth above
(if by facsimile to (212) 208-3566) and Continental at its address set forth
below and, in all cases, both any original and all copies shall be marked to
indicate "URGENT MATERIAL ENCLOSED.")
(b) To Continental:
Continental Airlines Inc.
1600 Smith Street HQSFN
Houston, Texas 77002
Attention: Treasurer
Facsimile: 713-324-2447
Confirmation: 713-324-2544
(c) To the Subordination Agent:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
Attention: Corporate Trust Administration
Facsimile: 302-651-8882
A party may specify an additional or different address or addresses by
writing mailed or delivered to the other parties as aforesaid. All such notices
and other communications shall be effective upon receipt unless received after
business hours on any day, in which case on the opening of business on the next
Business Day.
SECTION 5.03 SEVERABILITY. In the event that any provision of this
Insurance Agreement shall be held invalid or unenforceable by any court of
competent jurisdiction, the parties hereto agree that such holding shall not
invalidate or render unenforceable any other provision hereof. The parties
hereto further agree that the holding by any court of competent jurisdiction
that any remedy pursued by any party hereto is unavailable or unenforceable
shall not affect in any way the ability of such party to pursue any other remedy
available to it.
SECTION 5.04 GOVERNING LAW. This Insurance Agreement shall be
governed by and construed in accordance with the laws of the State of New York,
including all matters of construction, validity and performance. This Insurance
Agreement is being delivered in New York.
SECTION 5.05 CONSENT TO JURISDICTION.
(a) The parties hereto hereby irrevocably submit to the
non-exclusive jurisdiction of the United States District Court for the Southern
District of New York and any court of appropriate jurisdiction in the State of
New York located in the City and County of New York, and any appellate court
from any thereof, in any action, suit or proceeding brought against it or in
connection with any of the Operative Agreements or the Transactions or for
recognition or enforcement of any judgment, and the parties hereto hereby
irrevocably and unconditionally agree that all claims in respect of any such
action or proceeding may be heard or determined in such New York state court or,
to the extent permitted by law, in such federal court. The parties hereto agree
that a final unappealable judgment in any such action, suit or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. To the extent permitted by applicable
law, the parties hereto hereby waive and agree not to assert by way of motion,
as a defense or otherwise in any such suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of such courts, that the suit,
action or proceeding is brought in an inconvenient forum, that the venue of the
suit, action or proceeding is improper or that the related documents or the
subject matter thereof may not be litigated in or by such courts.
(b) To the extent permitted by applicable law, the parties hereto
shall not seek and hereby waive the right to any review of the judgment of any
such court by any court of any other nation or jurisdiction which may be called
upon to grant an enforcement of such judgment.
(c) Service on any party may be made by delivering, by U.S.
registered mail, messenger or courier service, copies of the summons and
complaint and other process which may be served in any suit, action or
proceeding to such party addressed to its street address shown in Section
5.02(b), Attention: General Counsel, and such service shall be effective service
of process for any litigation brought against such party in any court. Such
address may be changed by such party by written notice to the other parties
hereto.
(d) Nothing contained in this Insurance Agreement shall limit or
affect any party's right to serve process in any other manner permitted by law
or to start legal proceedings relating to any of the Operative Agreements
against any other party or its properties in the courts of any jurisdiction.
SECTION 5.06 CONSENT OF POLICY PROVIDER. In the event that the
consent of the Policy Provider is required under any Operative Agreement, the
determination whether to grant or withhold such consent shall be made by the
Policy Provider in its sole discretion without any implied duty towards any
other Person, except as otherwise expressly provided therein.
SECTION 5.07 COUNTERPARTS. This Insurance Agreement may be executed
in counterparts by the parties hereto, and all such counterparts shall
constitute one and the same instrument.
SECTION 5.08 HEADINGS. The headings of Articles and Sections and the
Table of Contents contained in this Insurance Agreement are provided for
convenience only. They form no part of this Insurance Agreement and shall not
affect its construction or interpretation.
SECTION 5.09 TRIAL BY JURY WAIVED. Each party hereby waives, to the
fullest extent permitted by law, any right to a trial by jury in respect of any
litigation arising directly or indirectly out of, under or in connection with
this Insurance Agreement. Each party hereto (A) certifies that no
representative, agent or attorney of any party hereto has represented, expressly
or otherwise, that it would not, in the event of litigation, seek to enforce the
foregoing waiver and (B) acknowledges that it has been induced to enter into the
Operative Agreements to which it is a party by, among other things, this waiver.
SECTION 5.10 LIMITED LIABILITY. No recourse under any Operative
Agreement or the Policies shall be had against, and no personal liability shall
attach to, any officer, employee, director, affiliate or shareholder of any
party hereto, as such, by the enforcement of any assessment or by any legal or
equitable proceeding, by virtue of any statute or otherwise in respect of any of
the Operative Agreements, the Certificates or the Policies, it being expressly
agreed and understood that each Operative Agreement is solely an obligation of
each party hereto, and that any and all personal liability, either at common law
or in equity, or by statute or constitution, of every such officer, employee,
director, affiliate or shareholder for breaches of any party hereto of any
obligations under any Operative Agreement is hereby expressly waived as a
condition of and in consideration for the execution and delivery of this
Insurance Agreement.
SECTION 5.11 ENTIRE AGREEMENT. This Insurance Agreement, the
Policies, the Policy Fee Letters and the other Operative Agreements set forth
the entire agreement between the parties with respect to the subject matter
hereof and thereof, and supersede and replace any agreement or understanding
that may have existed between the parties prior to the date hereof in respect of
such subject matter. This Insurance Agreement and the Policies are separate and
independent agreements and nothing herein shall be construed to vary or
otherwise modify any terms of the Policies. No breach by any party hereto of any
representation, warranty, covenant, agreement or undertaking contained herein
shall in any way affect the obligations of the Policy Provider under the
Policies.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have executed this
Insurance Agreement, all as of the day and year first above mentioned.
AMBAC ASSURANCE CORPORATION,
as Policy Provider
By:
---------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Subordination Agent
By:
---------------------------------------
Name:
Title:
CONTINENTAL AIRLINES, INC.
By:
---------------------------------------
Name:
Title:
SCHEDULE I
1. Section 9.1(c) of the Intercreditor Agreement
2. Section 9.1(d) of the Intercreditor Agreement.
3. The definition of "Secured Obligations" in Annex A to the Indenture.
4. The definition of "Related Secured Obligations" in Annex A to the
Indenture.
5. The Granting Clause of the Indenture (except to the insert model and
identification information with respect to the Aircraft and Engines).
6. Article 3 of the Indenture.
7. Section 1(d) of the Note Purchase Agreement.
8. Clause (vi) of Section 4(a) of the Note Purchase Agreement.
9. The Class I Certificates, if redeemed, can not be reissued.
10. The Capped Interest Rate (as defined in the Revolving Credit Agreement)
shall not exceed, during each of the periods set forth below, the Capped
Interest Rate set forth opposite each such period:
PERIOD CAPPED INTEREST RATE
------------------------------------------------------------
Initial Date - August 14, 2002 8.05%
August 15, 2002 - February 14, 2003 8.15%
February 15, 2003 - August 14, 2003 8.25%
August 15, 2003 - February 14, 2004 8.35%
February 15, 2004 - August 14, 2004 8.55%
August 15, 2004 - February 14, 2005 8.75%
February 15, 2005 - August 14, 2005 9.05%
August 15, 2005 - February 14, 2006 9.35%
February 15, 2006 - August 14, 2006 9.75%
August 15, 2006 - February 14, 2007 10.15%
February 15, 2007 - August 14, 2007 10.65%
August 15, 2007 - February 14, 2008 11.15%
February 15, 2008 - August 14, 2008 11.65%
August 15, 2008 - February 14, 2009 12.15%
February 15, 2009 - August 14, 2009 12.75%
August 15, 2009 - February 14, 2010 13.35%
February 15, 2010 - August 14, 2010 14.05%
August 15, 2010 - February 14, 2011 14.75%
February 15, 2011 - August 14, 2011 15.55%
August 15, 2011 - February 14, 2012 16.35%
February 15, 2012 - August 14, 2012 17.25%
11. The maximum amount of Series G Equipment Notes (including both Series G-1
Equipment Notes and Series G-2 Equipment Notes) shall not exceed, on a per
aircraft basis and on an aggregate basis, on each Semi-Annual Distribution
Date set forth below, the US Dollar amounts set forth opposite each such
Semi-Annual Distribution Date:
B757-300 B767-400ER B777-200ER AGGREGATE
(ALL SEVEN
AIRCRAFT)
MAXIMUM MAXIMUM MAXIMUM MAXIMUM
SEMI-ANNUAL G-1 + G-2 G-1 + G-2 G-1 + G-2 G-1 + G-2
DISTRIBUTION DATE BALANCE BALANCE BALANCE BALANCE
- --------------------------------------------------------------------------------
Initial Date 32,360,310 49,025,984 68,341,444 329,166,000
August 15, 2002 32,360,310 49,025,984 68,341,444 329,166,000
February 15, 2003 31,369,640 47,525,116 66,249,256 319,089,000
August 15, 2003 30,755,989 46,595,433 64,953,290 312,847,000
February 15, 2004 30,080,206 45,571,619 63,526,112 305,973,000
August 15, 2004 29,184,995 44,215,371 61,635,526 296,867,000
February 15, 2005 28,529,267 43,221,942 60,250,698 290,197,000
August 15, 2005 27,647,328 41,885,801 58,388,140 281,226,000
February 15, 2006 27,011,656 40,922,755 57,045,668 274,760,000
August 15, 2006 26,143,185 39,607,019 55,211,554 265,926,000
February 15, 2007 25,527,568 38,674,356 53,911,440 259,664,000
August 15, 2007 24,672,468 37,378,876 52,105,560 250,966,000
February 15, 2008 24,076,807 36,476,449 50,847,590 244,907,000
August 15, 2008 23,235,077 35,201,225 49,069,946 236,345,000
February 15, 2009 22,659,472 34,329,181 47,854,332 230,490,000
August 15, 2009 21,831,112 33,074,212 46,104,928 222,064,000
February 15, 2010 21,275,562 32,232,553 44,931,664 216,413,000
August 15, 2010 20,460,572 30,997,840 43,210,496 208,123,000
February 15, 2011 19,925,078 30,186,564 42,079,588 202,676,000
August 15, 2011 19,123,458 28,972,107 40,386,656 194,522,000
February 15, 2012 - - - -
AMBAC Ambac Assurance Corporation
One State Street Plaza, 15th Floor
New York, New York 10004
Telephone: (212) 668-0340
CERTIFICATE GUARANTY INSURANCE POLICY
Insured Obligations: Policy Number: AB0542BE
1. Continental Airlines
2002-1 Pass-Through Trusts
Pass-Through Certificates, Series 2002-1
$134,644,000 Class G-1 and Class G-1 Escrow Receipts attached thereto
(as defined in the attached endorsement) Premium:
As set forth in the
policy fee letter.
2. Excess Interest
(as defined in the attached endorsement)
AMBAC ASSURANCE CORPORATION (AMBAC), a Wisconsin stock insurance corporation, in
consideration of the payment of the premium and subject to the terms of this
Policy, hereby agrees unconditionally and irrevocably to pay to the Trustee for
the benefit of the Holders of the Insured Obligations, that portion of the
Insured Amounts which shall become Due for Payment but shall be unpaid by reason
of Nonpayment.
Ambac will make such payments to the Trustee from its own funds on the later of
(a) one (1) Business Day following notification to Ambac of Nonpayment or (b)
the Business Day on which the Insured Amounts are Due for Payment. Such payments
of principal or interest shall be made only upon presentation of an instrument
of assignment in form and substance satisfactory to Ambac, transferring to Ambac
all rights under such Insured Obligations to receive the principal of and
interest on the Insured Obligation. Ambac shall be subrogated to all the
Holders' rights to payment on the Insured Obligations to the extent of the
insurance disbursements so made. Once payments of the Insured Amounts have been
made to the Trustee, Ambac shall have no further obligation hereunder in respect
of such Insured Amounts.
In the event the Trustee for the Insured Obligations has notice that any payment
of principal or interest on an Insured Obligation which has become Due for
Payment and which is made to a Holder by or on behalf of the Trustee has been
deemed a preferential transfer and theretofore recovered from its Holder
pursuant to the United States Bankruptcy Code in accordance with a final,
nonappealable order of a court of competent jurisdiction, such Holder will be
entitled to payment from Ambac to the extent of such recovery if sufficient
funds are not otherwise available.
This Policy is noncancelable by Ambac for any reason, including failure to
receive payment of any premium due hereunder. The premium on this Policy is not
refundable for any reason. This Policy does not insure against loss of any
prepayment or other acceleration payment which at any time may become due in
respect of any Insured Obligation, other than at the sole option of Ambac, nor
against any risk other than Nonpayment, including failure of the Trustee to make
any payment due Holders of Insured Amounts.
To the fullest extent permitted by applicable law, Ambac hereby waives and
agrees not to assert any and all rights and defenses, to the extent such rights
and defenses may be available to Ambac, to avoid payment of its obligations
under this Policy in accordance with the express provisions hereof.
Any capitalized terms not defined herein shall have the meaning given such terms
in the endorsement attached hereto or in the Agreement.
In witness whereof, Ambac has caused this Policy to be affixed with its
corporate seal and to be signed by its duly authorized officers in facsimile to
become effective as their original signatures and binding upon Ambac by virtue
of the countersignature of its duly authorized representative.
/S/ ROBERT J. GENADER [AMBAC SEAL] /S/ ANNE G. GILL
President Secretary
Effective Date: March 25, 2002 Authorized Representative
Form No.: 2B-0022 (7/97)
CERTIFICATE GUARANTY INSURANCE POLICY ENDORSEMENT
Attached to and forming Effective Date of Endorsement:
part of Policy No. AB0542BE March 25, 2002
issued to:
Wilmington Trust Company
not in its individual capacity but solely as Subordination
Agent and Trustee under the Agreement, together with its successors
and assigns in such capacity
Landesbank Hessen-Thuringen Girozentrale,
as Class G-1 Primary Liquidity Provider, together with
any Replacement Primary Liquidity Provider for any Class G-1 Primary
Liquidity Facility solely with respect to Deficiency Amounts
described in item (g) of the
definition of "Deficiency Amount"
For all purposes of this Policy, the following terms shall have the
following meanings:
"Agreement" shall mean the Intercreditor Agreement, dated as of March 25,
2002, by and among Wilmington Trust Company, as Class G-1 Trustee, Class G-2
Trustee, Class H Trustee and Class I Trustee, Landesbank Hessen-Thuringen
Girozentrale, as Class G-1 Primary Liquidity Provider and Class G-2 Primary
Liquidity Provider, Merrill Lynch Capital Services, Inc., as Class G-1 Above-Cap
Liquidity Provider, Ambac Assurance Corporation, as Policy Provider, and
Wilmington Trust Company, as Subordination Agent, without regard to any
amendment or supplement thereto unless such amendment or supplement has been
executed, or otherwise approved in writing, by the Insurer or deemed consented
to pursuant to Section 9.1(c) or 9.1(d) thereof.
"Class G-1 Escrow Receipts" shall mean the Escrow Receipts with respect to
the Class G-1 Trust.
"Class G-1 Final Legal Distribution Date" means February 15, 2013.
"Collateral" shall have the meaning set forth in the Insurance Agreement.
"Deficiency Amount" shall mean:
(a) with respect to any Regular Distribution Date other than the Class G-1
Final Legal Distribution Date, any shortfall in amounts available to the
Subordination Agent, after giving effect to the subordination provisions of the
Agreement and to the application of Prior Funds on such Distribution Date in
accordance with the Agreement, for the payment of accrued and unpaid interest at
the applicable Stated Interest Rate on the Pool Balance of the Class G-1
Certificates, and, without duplication, accrued and unpaid interest on any
Deposit relating to the Class G-1 Escrow Receipts, on such Distribution Date;
(b) with respect to any Special Distribution Date (which is not also an
Election Distribution Date) established by reason of receipt of a Special
Payment constituting the proceeds of any Series G-1 Equipment Note or the
related Collateral, as the case may be, any shortfall in amounts available to
the Subordination Agent, after giving effect to the subordination provisions of
the Agreement and to the application of any Prior Funds, for the reduction in
the outstanding Pool Balance of the Class G-1 Certificates by an amount equal to
the outstanding principal amount of such Series G-1 Equipment Note (determined
immediately prior to the receipt of such proceeds) plus accrued and unpaid
interest on the amount of such reduction accrued at the applicable Stated
Interest Rate for the Class G-1 Certificates for the period from the immediately
preceding Regular Distribution Date to such Special Distribution Date;
(c) with respect to any Special Distribution Date established by reason of
the failure of the Subordination Agent to have received a Special Payment
constituting the proceeds of any Disposition on or before the date which is
twenty-four (24) months after the last date on which any payment due was made in
full on any Series G-1 Equipment Note (the date of any such payment in full
being a "Last Payment Date") as to which there has been a failure to pay
principal or that has been accelerated subsequent to the Last Payment Date, the
amount equal to the outstanding principal amount of such Series G-1 Equipment
Note plus accrued and unpaid interest thereon at the applicable Stated Interest
Rate for the Class G-1 Certificates from the immediately preceding Regular
Distribution Date to such Special Distribution Date; PROVIDED, HOWEVER, that if
the Insurer shall have duly given a Notice of Insurer Election at least 35 days
prior to the end of such 24-month period, the Deficiency Amount with respect to
such Special Distribution Date shall be an amount equal to the shortfall in
amounts available to the Subordination Agent, after giving effect to the
application of any drawing paid under the Class G-1 Liquidity Facility in
respect of interest due on the Class G-1 Certificates on such Distribution Date
and any withdrawal from the Class G-1 Cash Collateral Account or the Class G-1
Above-Cap Account in respect of interest due on such Distribution Date in
accordance with the Agreement, in each case, attributable to interest on such
Series G-1 Equipment Note, for payment of the scheduled principal (without
regard to the acceleration thereof) and interest due but not paid at the
applicable Stated Interest Rate for the Class G-1 Certificates on such Series
G-1 Equipment Note during such twenty-four (24) month period;
(d) with respect to each Regular Distribution Date following the Special
Distribution Date as to which any Notice of Insurer Election described in (c)
above has been given in respect of any Series G-1 Equipment Note, and prior to
the establishment of a Special Distribution Date at the election of the Insurer
in accordance with Section 3.7(c) of the Agreement or an Election Distribution
Date with respect to such Series G-1 Equipment Note, an amount equal to the
scheduled principal (without regard to the acceleration thereof) and interest
payments (without regard to any funds available under the Class G-1 Primary
Liquidity Facility, the Class G-1 Cash Collateral Account, the Class G-1
Above-Cap Account or the Class G-1 Above-Cap Collateral Account) at the
applicable Stated Interest Rate for the Class G-1 Certificates (without
duplication of any payments that may be required to be made under item (a)
above) payable on such Regular Distribution Date on such Series G-1 Equipment
Note;
(e) with respect to any Special Distribution Date elected by the Insurer
in accordance with Section 3.7(c) of the Agreement or which is an Election
Distribution Date, an amount equal to the shortfall in amounts available to the
Subordination Agent to pay in full the then outstanding principal balance of the
Series G-1 Equipment Note as to which such Special Distribution Date or Election
Distribution Date relates and accrued and unpaid interest thereon at the
applicable Stated Interest Rate for the Class G-1 Certificates from the
immediately preceding Regular Distribution Date to such Special Distribution
Date or such Election Distribution Date, as the case may be, less any Insured
Amounts paid by the Insurer in respect of principal on such Series G-1 Equipment
Note;
(f) with respect to the Class G-1 Final Legal Distribution Date, any
shortfall in amounts available to the Subordination Agent for the payment in
full of the Final Distributions (calculated as of such date but excluding any
accrued and unpaid premium (which shall include, without limitation, Premium))
on the Class G-1 Certificates, after giving effect to the subordination
provisions of the Agreement and to the application of Prior Funds; and
(g) with respect to any Distribution Date (including any Special
Distribution Date or Election Distribution Date) which occurs during any Excess
Interest Period, the amount equal to the Excess Interest unpaid on such date.
"Due for Payment" shall mean the portion of the Insured Amounts which is
"Due for Payment" on any Distribution Date under this Policy; such portion shall
be equal to the Deficiency Amount existing for such Distribution Date.
"Election Distribution Date" shall mean any Special Distribution Date
established by reason of (i) the occurrence and continuation of a Policy
Provider Default occurring after a Notice of Insurer Election or (ii) the
receipt of a Special Payment constituting the proceeds of a Disposition relating
to a Series G-1 Equipment Note as to which a Notice of Insurer Election has been
given.
"Excess Interest" shall mean interest accrued on all outstanding Drawings
under the Class G-1 Primary Liquidity Facility (together with interest
previously accrued thereon), exclusive of any default interest, from and after
the first day of any Excess Interest Period to the date of determination.
"Excess Interest Period" shall mean, with respect to any Series G-1
Equipment Note and Drawing attributable thereto, the period commencing on the
day immediately following the end of the twenty-four (24) month period referred
to in clause (c) of the definition of "Deficiency Amount" with respect to any
such Series G-1 Equipment Note, and ending on the later to occur of (i) the
Class G-1 Final Legal Distribution Date and (ii) the date on which all
obligations owed to the Class G-1 Primary Liquidity Provider have been paid in
full.
"Holder" shall mean any person who is the registered owner or beneficial
owner of any of the Class G-1 Certificates or the Escrow Receipts attached
thereto and who, on the applicable Distribution Date, is entitled under the
terms of the Class G-1 Certificates or the Escrow Receipts attached thereto to
payment thereunder.
"Insolvency Proceeding" means the commencement, after the date hereof, of
any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of
assets and liabilities or similar proceedings by or against Continental
Airlines, Inc., the Class G-1 Primary Liquidity Provider or the Class G-1
Above-Cap Liquidity Provider and the commencement, after the date hereof, of any
proceedings by Continental Airlines, Inc., the Class G-1 Primary Liquidity
Provider or the Class G-1 Above-Cap Liquidity Provider for the winding up or
liquidation of its affairs or the consent, after the date hereof, to the
appointment of a trustee, conservator, receiver or liquidator in any bankruptcy,
insolvency, readjustment of debt, reorganization, marshalling of assets and
liabilities or similar proceedings of or relating to Continental Airlines, Inc.,
the Class G-1 Primary Liquidity Provider or the Class G-1 Above-Cap Liquidity
Provider.
"Insurance Agreement" shall mean the Insurance and Indemnity Agreement
dated as of March 25, 2002, by and among the Insurer, Continental Airlines, Inc.
and Wilmington Trust Company, not in its individual capacity, but solely as
Subordination Agent, as amended, modified or supplemented from time to time in
accordance with the terms thereof.
"Insurance Policy" or "Policy" shall mean the Certificate Guaranty
Insurance Policy of which this Endorsement is a part together with each and
every endorsement thereto.
"Insured Amount" shall mean, with respect to any Distribution Date, the
Deficiency Amount for such Distribution Date.
"Insured Obligations" shall mean the Class G-1 Certificates and the Escrow
Receipts attached thereto and Excess Interest.
"Insured Payments" shall mean, (i) with respect to any Distribution Date,
the aggregate amount actually paid by the Insurer to the Subordination Agent
(or, with respect to Insured Amounts in respect of amounts described in item (g)
of the definition of "Deficiency Amount", to the Class G-1 Primary Liquidity
Provider) in respect of the Insured Amount for such Distribution Date, and (ii)
the Preference Amount for any given Business Day.
"Insurer" shall mean Ambac Assurance Corporation, or any successor
thereto, as issuer of the Insurance Policy.
"Last Payment Date" shall have the meaning given to that term in subclause
(c) of the definition of "Deficiency Amount".
"Nonpayment" shall mean, with respect to any Distribution Date, a
Deficiency Amount owing to the Subordination Agent for distribution to the
Holders in respect of such Distribution Date or to the Class G-1 Primary
Liquidity Provider in respect of Excess Interest.
"Notice of Avoided Payment" shall mean the telephonic or telegraphic
notice, promptly confirmed in writing by telecopy substantially in the form of
Exhibit B to the Policy, in each instance delivered or performed on a Business
Day and sent to the contact person at the address and/or fax number set forth in
Section 10.3 of the Agreement, the original of which is subsequently delivered
by registered or certified mail from the Subordination Agent specifying the
Preference Amount which shall be due and owing on the applicable Distribution
Date.
"Notice of Insurer Election" shall mean a notice given by the Insurer when
no Policy Provider Default shall have occurred and be continuing, stating that
the Insurer elects to make payments of Deficiency Amounts as defined under the
proviso to clause (c) and the provisions of clause (d) and, if applicable,
clause (e) of the definition of "Deficiency Amounts" in respect of any Series
G-1 Equipment Note in lieu of applying clause (c) (without the proviso) of the
definition of "Deficiency Amount", which notice shall be given to the
Subordination Agent not less than thirty-five (35) days prior to the Special
Distribution Date established for payment of a Deficiency Amount under clause
(c) (without the proviso) of the definition thereof.
"Notice of Nonpayment" shall mean the telephonic or telegraphic notice,
promptly confirmed in writing by telecopy substantially in the form of Exhibit
A-1 (or, with respect to Insured Amounts in respect of amounts described in item
(g) of the definition of "Deficiency Amount," Exhibit A-2) to the Policy, in
each instance delivered or performed on a Business Day and sent to the contact
person at the address and/or fax numbers set forth in Section 10.3 of the
Agreement, the original of which is subsequently delivered by registered or
certified mail from the Subordination Agent (or, with respect to Insured Amounts
in respect of amounts described in item (g) of the definition of "Deficiency
Amount" from the Class G-1 Primary Liquidity Provider) specifying the Insured
Amount which shall be due and owing to the Subordination Agent (or, with respect
to Insured Amounts in respect of amounts described in item (g) of the definition
of "Deficiency Amount," to the Class G-1 Primary Liquidity Provider) for
distribution to the Holders or the Class G-1 Primary Liquidity Provider, as
applicable, on the applicable Distribution Date.
"Order" shall mean a final, non-appealable order of a court of competent
jurisdiction exercising jurisdiction in an insolvency proceeding.
"Preference Amount" means any payment of principal of, or interest at the
applicable Stated Interest Rate on, the Series G-1 Equipment Notes made to the
Class G-1 Trustee or the Subordination Agent or (without duplication) any
payment of the Pool Balance of, or interest at the applicable Stated Interest
Rate on, the Class G-1 Certificates (or any payment of the proceeds of any
drawing under the Class G-1 Primary Liquidity Facility or the Class G-1
Above-Cap Account) made to a Holder which has become recoverable or been
recovered from the Class G-1 Trustee, the Subordination Agent or the Holders (as
the case may be) as a result of such payment being determined or deemed a
preferential transfer pursuant to the United States Bankruptcy Code or otherwise
rescinded or required to be returned in accordance with an Order.
"Prior Funds" shall, at any date of determination, mean (i) any amounts
received by the Escrow Agent in the Paying Agent Account for the Class G-1
Certificates in respect of accrued interest on the Deposits for the Class G-1
Certificates on such date, (ii) any drawing paid under the Class G-1 Primary
Liquidity Facility in respect of interest due on the Class G-1 Certificates on
such date, and (iii) any amounts withdrawn from the Class G-1 Cash Collateral
Account and the Class G-1 Above-Cap Account in respect of interest due on the
Class G-1 Certificates on such date.
"Subordination Agent" shall mean Wilmington Trust Company, not in its
individual capacity but solely as Subordination Agent under the Agreement, or
any successor thereto under the Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Agreement, as defined herein.
Notwithstanding the first sentence of the second paragraph of the face of
this Policy, the Insurer will pay any Insured Amount payable hereunder no later
than 4:00 p.m. (New York City time) to the Subordination Agent (or, with respect
to Insured Amounts in respect of amounts described in item (g) of the definition
of "Deficiency Amount," to the Class G-1 Primary Liquidity Provider) on the
later of (i) the Distribution Date on which the related Deficiency Amount
occurs, or (ii) the Business Day on which the Insurer receives a Notice of
Nonpayment; provided that, if such Notice of Nonpayment is received after 1:00
p.m. (New York City time) on such Business Day, it will be deemed to be received
on the following Business Day. If any such Notice of Nonpayment is not in proper
form or is otherwise insufficient for the purpose of making a claim under the
Policy, it shall be deemed not to have been received for purposes of this
paragraph, and the Insurer shall promptly so advise the Subordination Agent (or
the Class G-1 Primary Liquidity Provider, if applicable) and the Subordination
Agent (or the Class G-1 Primary Liquidity Provider, if applicable) may submit an
amended Notice of Nonpayment.
Notwithstanding the third paragraph of the face of this Policy, the
Insurer shall pay any Preference Amount due to be paid pursuant to an Order, no
later than 4:00 p.m. on the earlier of (x) the Special Distribution Date
established for the payment of such Preference Amount (or, if payment is to be
made to a receiver, conservator, debtor-in-possession or trustee in bankruptcy,
as directed by the Subordination Agent on the date specified in the Order or in
the absence thereof, in the request therefor) and (y) the third Business Day
after the date of the expiration of this Policy, but in any event no earlier
than the third Business Day following receipt by the Insurer on a Business Day
of (i) a certified copy of an Order, (ii) a certificate by or on behalf of the
Subordination Agent, the Class G-1 Trustee or the Holder that such Order has
been entered and is not subject to any stay, (iii) an assignment, in form and
substance satisfactory to the Insurer, duly executed and delivered by the
Subordination Agent, the Class G-1 Trustee or the Holder, irrevocably assigning
to the Insurer all rights and claims of the Subordination Agent, the Class G-1
Trustee or the Holder (provided such Preference Amount is received by the
Holder) with respect to such Preference Amount and (iv) a Notice of Avoided
Payment (in the form attached hereto as Exhibit B) appropriately completed and
executed by the Subordination Agent. Any Notice of Avoided Payment received by
the Insurer after 1:00 p.m. (New York City time) on a Business Day shall be
deemed to have been received on the next Business Day. If any Notice of Avoided
Payment is not in proper form or is otherwise insufficient for the purpose of
making a claim under the Policy, it shall be deemed not to have been received
for purposes of this paragraph and the Insurer shall promptly so advise the
Subordination Agent and the Subordination Agent may submit an amended Notice of
Avoided Payment. Such payment shall be disbursed to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order, and not to the
Subordination Agent, the Class G-1 Trustee or the Holder directly, unless the
Subordination Agent, the Class G-1 Trustee or the Holder has made a payment of
the Preference Amount to the court or such receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order, in which case
the Insurer will pay to the Subordination Agent for payment over to the Holder
or the Class G-1 Trustee, subject to the delivery of (a) the items referred to
in clauses (i), (ii), (iii) and (iv) above to the Insurer and (b) evidence
satisfactory to the Insurer that payment has been made to such court or
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Order.
No instrument of assignment shall be required notwithstanding the second
paragraph of the face of this Policy except in connection with payment of a
Preference Amount. Notwithstanding the second paragraph of the face of this
Policy, the Insurer shall not be subrogated to the Class G-1 Certificates, and
shall be subrogated to the Series G-1 Equipment Notes only to the extent
provided in the Agreement. For the avoidance of doubt, the subrogation
provisions in the Agreement include Sections 2.4, 3.2 and 3.3 thereof.
A premium will be payable on this Policy in accordance with the terms of
the Insurance Agreement.
The face of the Policy to which this Endorsement is attached and of which
it forms a part is hereby amended to provide that the Insurer shall have no
obligation (i) to pay any Insured Amount or Preference Amount except at the
times and in the amounts expressly provided for in this Policy or (ii) to pay
any amount in excess of $134,644,000, plus interest at the applicable Stated
Interest Rate for the Class G-1 Certificates for the period during which the
Class G-1 Certificates were outstanding plus Excess Interest. Clause (ii) of the
preceding sentence shall not limit the Insurer's payment obligations with
respect to any Deficiency Amount paid by the Insurer which becomes a Preference
Amount. This Policy does not cover (i) premiums (including, without limitation,
Premium), if any, payable in respect of the Class G-1 Certificates or the Class
G-1 Escrow Receipts, (ii) shortfalls, if any, attributable to the liability of
the Subordination Agent, the Class G-1 Trust or the Class G-1 Trustee for
withholding taxes, if any (including interest and penalties in respect of any
such liability) or (iii) any risk other than the risk of Nonpayment and the risk
of the occurrence of a Preference Amount, including failure of the Subordination
Agent or the Class G-1 Trustee to make any payment due to the Holders of the
Class G-1 Certificates from funds received.
This Policy and the obligations of the Insurer hereunder shall terminate
on the day (the "Termination Date") which is one year and one day following the
Distribution Date upon which the Final Distributions on the Class G-1
Certificates are made. The foregoing notwithstanding, if an Insolvency
Proceeding has commenced and has not been concluded or dismissed on the
Termination Date, then this Policy and the Insurer's obligations hereunder shall
terminate on the later of (i) the date of the conclusion or dismissal of such
Insolvency Proceeding without continuing jurisdiction by the court in such
Insolvency Proceeding, and (ii) the date on which the Insurer has made all
payments required to be made under the terms of this Policy in respect of
Preference Amounts.
Nothing herein contained shall be held to vary, alter, waive or extend any
of the terms, conditions, provisions, agreements or limitations of the
above-mentioned Policy other than as specifically provided for otherwise by this
Endorsement.
The obligations of the Insurer to make payments to the Class G-1 Primary
Liquidity Provider hereunder may not be amended or modified without the consent
of the Class G-1 Primary Liquidity Provider.
This Policy is issued under and pursuant to, and shall be construed under,
the laws of the State of New York.
ANY PERSON WHO KNOWINGLY, AND WITH INTENT TO INJURE, DEFRAUD OR DECEIVE
ANY INSURER, FILES A STATEMENT OF CLAIM CONTAINING ANY FALSE, INCOMPLETE OR
MISLEADING INFORMATION IS GUILTY OF A FELONY.
IN WITNESS WHEREOF, the Insurer has caused this Endorsement to the Policy
to be signed by its duly authorized officers.
Managing Director Assistant Secretary
- ------------------------------- -------------------------------
EXHIBIT A-1
TO THE CERTIFICATE GUARANTY INSURANCE POLICY
Policy No. AB0542BE
NOTICE OF NONPAYMENT AND DEMAND
FOR PAYMENT OF AN INSURED AMOUNT
Date: [ ]
AMBAC ASSURANCE CORPORATION
One State Street Plaza
New York, New York 10004
Attention: General Counsel
Reference is made to Certificate Guaranty Insurance Policy No. AB0542BE
(together with all endorsements thereto, the "Policy") issued by Ambac Assurance
Corporation ("Ambac"). Terms capitalized herein and not otherwise defined shall
have the meanings ascribed to such terms in or pursuant to the Policy unless the
context otherwise requires.
The Subordination Agent hereby certifies as follows:
1. The Subordination Agent is an agent for the Class G-1 Trustee
under the Agreement.
2. The relevant Distribution Date is __________. Such
Distribution Date is a [Regular Distribution Date, a Special
Distribution Date or the Class G-1 Final Legal Distribution
Date].
[3. Payment of interest at the applicable Stated Interest Rate on
the Class G-1 Certificates accrued to the Distribution Date
which is a Regular Distribution Date as determined pursuant to
paragraph (a) of the definition of "Deficiency Amount" in the
Policy is an amount equal to $_________________.]
[3. The amount determined for payment to the Holders of the Class
G-1 Certificates pursuant to paragraph (b) of the definition
of "Deficiency Amount" in the Policy on the Distribution Date
which is a Special Distribution Date in respect of a reduction
in the outstanding Pool Balance of such Class G-1 Certificates
and interest on the amount of such reduction at the applicable
Stated Interest Rate for the Class G-1 Certificates from the
immediately preceding Regular Distribution Date to such
Special Distribution Date is $___________.]
[3. The Subordination Agent has not received a timely Notice of
Insurer Election pursuant to the Policy and the amount
determined for payment to the Holders of the Class G-1
Certificates pursuant to paragraph (c) of the definition of
"Deficiency Amount" in the Policy on the Distribution Date
which is a Special Distribution Date in respect of the
outstanding principal amount of the relevant Series G-1
Equipment Note(s) and interest accrued thereon at the
applicable Stated Interest Rate for the Class G-1 Certificates
from the immediately preceding Regular Distribution Date to
such Special Distribution Date is $_______.]
[3. The Subordination Agent has received a timely Notice of
Insurer Election pursuant to the Policy and the amount
determined for payment to the Holders of the Class G-1
Certificates pursuant to the proviso in paragraph (c) of the
definition of "Deficiency Amount" in the Policy on the
Distribution Date which is a Special Distribution Date in
respect of scheduled principal (without regard to acceleration
thereof) and interest at the applicable Stated Interest Rate
for the Class G-1 Certificates that is due on the relevant
Series G-1 Equipment Note(s) during the twenty-four (24) month
period referred to in such paragraph (c) is $_________.]
[3. The Subordination Agent has received a timely Notice of
Insurer Election pursuant to the Policy, no Election
Distribution Date has been established pursuant to the Policy
or Special Distribution Date established at the election of
the Insurer in accordance with Section 3.7(c) of the Agreement
and the amount determined for payment to the Holders of the
Class G-1 Certificates pursuant to paragraph (d) of the
definition of "Deficiency Amount" in the Policy on the
Distribution Date which is a Regular Distribution Date in
respect of scheduled principal (without regard to acceleration
thereof) and (without duplication of any payments that may be
required to be made pursuant to paragraph (a) of such
definition) interest at the applicable Stated Interest Rate
for the Class G-1 Certificates due on the Regular Distribution
Date on the relevant Series G-1 Equipment Note(s) is
$____________.]
[3. The amount determined for payment to the Holders of the Class
G-1 Certificates pursuant to paragraph (e) of the definition
of "Deficiency Amount" in the Policy on the Distribution Date
which is a Special Distribution Date elected by the Insurer in
accordance with Section 3.7(c) of the Agreement or an Election
Distribution Date in respect of the outstanding principal
balance of the relevant Series G-1 Equipment Note(s) and
accrued interest thereon at the applicable Stated Interest
Rate for the Class G-1 Certificates from the immediately
preceding Regular Distribution Date to such Special
Distribution Date or Election Distribution Date, as the case
may be, is $__________.]
[3. The amount determined for payment to the Holders of the Class
G-1 Certificates pursuant to paragraph (f) of the definition
of "Deficiency Amount" in the Policy on the Distribution Date
which is the Class G-1 Final Legal Distribution Date in
respect of interest at the applicable Stated Interest Rate and
the Pool Balance of such Certificates is $__________.]
4. There is a Deficiency Amount in respect of such Distribution
Date of $__________________ in respect of the Class G-1
Certificates, which amount is an Insured Amount pursuant to
the terms of the Policy.
5. The sum of $__________________ is the Insured Amount that is
Due for Payment to the Subordination Agent.
6. The Subordination Agent has not heretofore made a demand for
the Insured Amount in respect of such Distribution Date.
7. The Subordination Agent hereby requests that payment of such
Insured Amount that is Due for Payment be made by Ambac under
the Policy and directs that payment under the Policy be made
to the following account by bank wire transfer of federal or
other immediately available funds in accordance with the terms
of the Policy to:
[ ]
ABA #[ ]
Acct#[ ]
FBO: [ ]
[Policy Account number.]
8. The Subordination Agent hereby agrees that, following receipt
of the Insured Amount from Ambac, it shall (a) cause such
funds to be deposited in the Policy Account and not permit
such funds to be held in any other account, (b) cause such
funds to be paid to the Class G-1 Trustee for distribution to
the Holders in payment of the Pool Balance of, or interest on,
the Class G-1 Certificates or interest on any related Deposit
(as applicable) and not apply such funds for any other purpose
and (c) maintain an accurate record of such payments with
respect to the Class G-1 Certificates or the related Deposits,
and the corresponding claim on the Policy and proceeds
thereof.
9. ANY PERSON WHO KNOWINGLY, AND WITH INTENT TO INJURE, DEFRAUD
OR DECEIVE ANY INSURER, FILES A STATEMENT OF CLAIM CONTAINING
ANY FALSE, INCOMPLETE OR MISLEADING INFORMATION IS GUILTY OF A
FELONY.
Wilmington Trust Company, not in its
individual capacity but solely as
Subordination Agent
By:
-----------------------------------
Title:
--------------------------------
(Officer)
EXHIBIT A-2
TO THE CERTIFICATE GUARANTY INSURANCE POLICY
Policy No. AB0542BE
NOTICE OF NONPAYMENT AND DEMAND
FOR PAYMENT OF AN INSURED AMOUNT TO THE CLASS G-1 PRIMARY
LIQUIDITY PROVIDER
Date: [ ]
AMBAC ASSURANCE CORPORATION
One State Street Plaza
New York, New York 10004
Attention: General Counsel
Reference is made to Certificate Guaranty Insurance Policy No. AB0542BE
(together with all endorsements thereto, the "Policy") issued by Ambac Assurance
Corporation ("Ambac"). Terms capitalized herein and not otherwise defined shall
have the meanings ascribed to such terms in or pursuant to the Policy unless the
context otherwise requires.
The Class G-1 Primary Liquidity Provider hereby certifies as follows:
1. The relevant Distribution Date is __________. Such
Distribution Date is a Distribution Date described in item (g)
of the definition of "Deficiency Amount" in the Policy. The
Excess Interest payable on such Distribution Date to the Class
G-1 Primary Liquidity Provider is $________.
2. There is a Deficiency Amount in respect of such Distribution
Date of $__________________ in respect of amounts owed to the
Class G-1 Primary Liquidity Provider, which amount is an
Insured Amount pursuant to the terms of the Policy.
3. The sum of $__________________ is the Insured Amount that is
Due for Payment to the Class G-1 Primary Liquidity Provider.
4. The Class G-1 Primary Liquidity Provider has not heretofore
made a demand for the Insured Amount in respect of such
Distribution Date.
5. The Class G-1 Primary Liquidity Provider hereby requests that
payment of such Insured Amount that is Due for Payment be made
by Ambac under the Policy and directs that payment under the
Policy be made to the following account by bank wire transfer
of federal or other immediately available funds in accordance
with the terms of the Policy to:
[ ]
ABA #[ ]
Acct#[ ]
FBO: [ ]
[Policy Account number.]
6. The Class G-1 Primary Liquidity Provider hereby agrees that,
following receipt of the Insured Amount from Ambac, it shall
maintain an accurate record of such payments with respect to
the Class G-1 Primary Liquidity Facility and the corresponding
claim of the Class G-1 Primary Liquidity Provider on the
Policy and proceeds thereof.
7. ANY PERSON WHO KNOWINGLY, AND WITH INTENT TO INJURE, DEFRAUD
OR DECEIVE ANY INSURER, FILES A STATEMENT OF CLAIM CONTAINING
ANY FALSE, INCOMPLETE OR MISLEADING INFORMATION IS GUILTY OF A
FELONY.
Landesbank Hessen-Thuringen Girozentrale,
as Class G-1 Primary Liquidity Provider
By:
---------------------------------------
Title:
------------------------------------
(Officer)
EXHIBIT B
TO THE CERTIFICATE GUARANTY INSURANCE POLICY
Policy No. AB0542BE
NOTICE OF AVOIDED PAYMENT AND DEMAND
FOR PAYMENT OF PREFERENCE AMOUNTS
Date: [ ]
AMBAC ASSURANCE CORPORATION
One State Street Plaza
New York, New York 10004
Attention: General Counsel
Reference is made to Certificate Guaranty Insurance Policy No. AB0542BE
(together with all endorsements thereto, the "Policy") issued by Ambac Assurance
Corporation ("Ambac"). Terms capitalized herein and not otherwise defined shall
have the meanings ascribed to such terms in or pursuant to the Policy unless the
context otherwise requires.
The Subordination Agent hereby certifies as follows:
1. The Subordination Agent is an agent for the Class G-1 Trustee under
the Agreement.
2. The Subordination Agent has established ______________ as a Special
Distribution Date pursuant to the Agreement for amounts claimed
hereunder.
3. An Order providing for the recovery of a Preference Amount of
$___________________ has been issued.
4. $__________________ of the amount set forth in item No. 3 above has
been paid by the Subordination Agent, the Class G-1 Trustee or the
Holders and $________________ is required to be paid to the
receiver, conservator, debtor-in-possession or trustee in bankruptcy
named in the Order.
5. The Subordination Agent has not heretofore made a demand for such
Preference Amount.
6. The Subordination Agent hereby requests that payment of
$______________ of such Preference Amount be made to the receiver,
conservator, debtor-in-possession or trustee in bankruptcy named in
the Order and $________________ of such Preference Amount be paid to
the Subordination Agent for payment over to the Class G-1 Trustee
for distribution to the Holders, in each case, by Ambac under the
Policy and directs that such payments under the Policy be made to
the following accounts by bank wire transfer of federal or other
immediately available funds in accordance with the terms of the
Policy to:
7. For the portion to be paid to the receiver, conservator,
debtor-in-possession or trustee, to ______________________:
ABA #[ ]
Acct#[ ]
FBO: [ ]
[relevant account number]
For the portion to be paid to the Subordination Agent:
ABA #[ ]
Acct#[ ]
FBO: [ ]
[Policy Account Number]
8. ANY PERSON WHO KNOWINGLY, AND WITH INTENT TO INJURE, DEFRAUD OR
DECEIVE ANY INSURER, FILES A STATEMENT OF CLAIM CONTAINING ANY
FALSE, INCOMPLETE OR MISLEADING INFORMATION IS GUILTY OF A FELONY.
Wilmington Trust Company, not in its
individual capacity but solely as
Subordination Agent
By:
-----------------------------------
Title:
--------------------------------
(Officer)
AMBAC Ambac Assurance Corporation
One State Street Plaza, 15th Floor
New York, New York 10004
Telephone: (212) 668-0340
CERTIFICATE GUARANTY INSURANCE POLICY
Insured Obligations: Policy Number: AB0543BE
1. Continental Airlines
2002-1 Pass-Through Trusts
Pass-Through Certificates, Series 2002-1
$194,522,000 Class G-2 and Class G-2 Escrow Receipts attached thereto
(as defined in the attached endorsement) Premium:
As set forth in the
policy fee letter.
2. Excess Interest
(as defined in the attached endorsement)
AMBAC ASSURANCE CORPORATION (AMBAC), a Wisconsin stock insurance corporation, in
consideration of the payment of the premium and subject to the terms of this
Policy, hereby agrees unconditionally and irrevocably to pay to the Trustee for
the benefit of the Holders of the Insured Obligations, that portion of the
Insured Amounts which shall become Due for Payment but shall be unpaid by reason
of Nonpayment.
Ambac will make such payments to the Trustee from its own funds on the later of
(a) one (1) Business Day following notification to Ambac of Nonpayment or (b)
the Business Day on which the Insured Amounts are Due for Payment. Such payments
of principal or interest shall be made only upon presentation of an instrument
of assignment in form and substance satisfactory to Ambac, transferring to Ambac
all rights under such Insured Obligations to receive the principal of and
interest on the Insured Obligation. Ambac shall be subrogated to all the
Holders' rights to payment on the Insured Obligations to the extent of the
insurance disbursements so made. Once payments of the Insured Amounts have been
made to the Trustee, Ambac shall have no further obligation hereunder in respect
of such Insured Amounts.
In the event the Trustee for the Insured Obligations has notice that any payment
of principal or interest on an Insured Obligation which has become Due for
Payment and which is made to a Holder by or on behalf of the Trustee has been
deemed a preferential transfer and theretofore recovered from its Holder
pursuant to the United States Bankruptcy Code in accordance with a final,
nonappealable order of a court of competent jurisdiction, such Holder will be
entitled to payment from Ambac to the extent of such recovery if sufficient
funds are not otherwise available.
This Policy is noncancelable by Ambac for any reason, including failure to
receive payment of any premium due hereunder. The premium on this Policy is not
refundable for any reason. This Policy does not insure against loss of any
prepayment or other acceleration payment which at any time may become due in
respect of any Insured Obligation, other than at the sole option of Ambac, nor
against any risk other than Nonpayment, including failure of the Trustee to make
any payment due Holders of Insured Amounts.
To the fullest extent permitted by applicable law, Ambac hereby waives and
agrees not to assert any and all rights and defenses, to the extent such rights
and defenses may be available to Ambac, to avoid payment of its obligations
under this Policy in accordance with the express provisions hereof.
Any capitalized terms not defined herein shall have the meaning given such terms
in the endorsement attached hereto or in the Agreement.
In witness whereof, Ambac has caused this Policy to be affixed with its
corporate seal and to be signed by its duly authorized officers in facsimile to
become effective as their original signatures and binding upon Ambac by virtue
of the countersignature of its duly authorized representative.
/S/ ROBERT J. GENADER [AMBAC SEAL] /S/ ANNE G. GILL
President Secretary
Effective Date: March 25, 2002 Authorized Representative
Form No.: 2B-0022 (7/97)
CERTIFICATE GUARANTY INSURANCE POLICY ENDORSEMENT
Attached to and forming Effective Date of Endorsement:
part of Policy No. AB0543BE March 25, 2002
issued to:
Wilmington Trust Company
not in its individual capacity but solely as Subordination
Agent and Trustee under the Agreement, together with its successors
and assigns in such capacity
Landesbank Hessen-Thuringen Girozentrale,
as Class G-2 Primary Liquidity Provider, together with
any Replacement Primary Liquidity Provider for any Class G-2 Primary
Liquidity Facility solely with respect to Deficiency Amounts
described in item (g) of the
definition of "Deficiency Amount"
For all purposes of this Policy, the following terms shall have the
following meanings:
"Agreement" shall mean the Intercreditor Agreement, dated as of March 25,
2002, by and among Wilmington Trust Company, as Class G-1 Trustee, Class G-2
Trustee, Class H Trustee and Class I Trustee, Landesbank Hessen-Thuringen
Girozentrale, as Class G-1 Primary Liquidity Provider and Class G-2 Primary
Liquidity Provider, Merrill Lynch Capital Services, Inc., as Class G-1 Above-Cap
Liquidity Provider, Ambac Assurance Corporation, as Policy Provider, and
Wilmington Trust Company, as Subordination Agent, without regard to any
amendment or supplement thereto unless such amendment or supplement has been
executed, or otherwise approved in writing, by the Insurer or deemed consented
to pursuant to Section 9.1(c) or 9.1(d) thereof.
"Class G-2 Escrow Receipts" shall mean the Escrow Receipts with respect to
the Class G-2 Trust.
"Class G-2 Final Legal Distribution Date" means August 15, 2013.
"Collateral" shall have the meaning set forth in the Insurance Agreement.
"Deficiency Amount" shall mean:
(a) with respect to any Regular Distribution Date other than the Class G-2
Final Legal Distribution Date, any shortfall in amounts available to the
Subordination Agent, after giving effect to the subordination provisions of the
Agreement and to the application of Prior Funds on such Distribution Date in
accordance with the Agreement, for the payment of accrued and unpaid interest at
the applicable Stated Interest Rate on the Pool Balance of the Class G-2
Certificates, and, without duplication, accrued and unpaid interest on any
Deposit relating to the Class G-2 Escrow Receipts, on such Distribution Date;
(b) with respect to any Special Distribution Date (which is not also an
Election Distribution Date) established by reason of receipt of a Special
Payment constituting the proceeds of any Series G-2 Equipment Note or the
related Collateral, as the case may be, any shortfall in amounts available to
the Subordination Agent, after giving effect to the subordination provisions of
the Agreement and to the application of any Prior Funds, for the reduction in
the outstanding Pool Balance of the Class G-2 Certificates by an amount equal to
the outstanding principal amount of such Series G-2 Equipment Note (determined
immediately prior to the receipt of such proceeds) plus accrued and unpaid
interest on the amount of such reduction accrued at the applicable Stated
Interest Rate for the Class G-2 Certificates for the period from the immediately
preceding Regular Distribution Date to such Special Distribution Date;
(c) with respect to any Special Distribution Date established by reason of
the failure of the Subordination Agent to have received a Special Payment
constituting the proceeds of any Disposition on or before the date which is
twenty-four (24) months after the last date on which any payment due was made in
full on any Series G-2 Equipment Note (the date of any such payment in full
being a "Last Payment Date") as to which there has been a failure to pay
principal or that has been accelerated subsequent to the Last Payment Date, the
amount equal to the outstanding principal amount of such Series G-2 Equipment
Note plus accrued and unpaid interest thereon at the applicable Stated Interest
Rate for the Class G-2 Certificates from the immediately preceding Regular
Distribution Date to such Special Distribution Date; PROVIDED, HOWEVER, that if
the Insurer shall have duly given a Notice of Insurer Election at least 35 days
prior to the end of such 24-month period, the Deficiency Amount with respect to
such Special Distribution Date shall be an amount equal to the shortfall in
amounts available to the Subordination Agent, after giving effect to the
application of any drawing paid under the Class G-2 Liquidity Facility in
respect of interest due on the Class G-2 Certificates on such Distribution Date
and any withdrawal from the Class G-2 Cash Collateral Account in respect of
interest due on such Distribution Date in accordance with the Agreement, in each
case, attributable to interest on such Series G-2 Equipment Note, for payment of
the scheduled principal (without regard to the acceleration thereof) and
interest due but not paid at the applicable Stated Interest Rate for the Class
G-2 Certificates on such Series G-2 Equipment Note during such twenty-four (24)
month period;
(d) with respect to each Regular Distribution Date following the Special
Distribution Date as to which any Notice of Insurer Election described in (c)
above has been given in respect of any Series G-2 Equipment Note, and prior to
the establishment of a Special Distribution Date at the election of the Insurer
in accordance with Section 3.7(c) of the Agreement or an Election Distribution
Date with respect to such Series G-2 Equipment Note, an amount equal to the
scheduled principal (without regard to the acceleration thereof) and interest
payments (without regard to any funds available under the Class G-2 Primary
Liquidity Facility, the Class G-2 Cash Collateral Account) at the applicable
Stated Interest Rate for the Class G-2 Certificates (without duplication of any
payments that may be required to be made under item (a) above) payable on such
Regular Distribution Date on such Series G-2 Equipment Note;
(e) with respect to any Special Distribution Date elected by the Insurer
in accordance with Section 3.7(c) of the Agreement or which is an Election
Distribution Date, an amount equal to the shortfall in amounts available to the
Subordination Agent to pay in full the then outstanding principal balance of the
Series G-2 Equipment Note as to which such Special Distribution Date or Election
Distribution Date relates and accrued and unpaid interest thereon at the
applicable Stated Interest Rate for the Class G-2 Certificates from the
immediately preceding Regular Distribution Date to such Special Distribution
Date or such Election Distribution Date, as the case may be, less any Insured
Amounts paid by the Insurer in respect of principal on such Series G-2 Equipment
Note;
(f) with respect to the Class G-2 Final Legal Distribution Date, any
shortfall in amounts available to the Subordination Agent for the payment in
full of the Final Distributions (calculated as of such date but excluding any
accrued and unpaid premium (which shall include, without limitation, Premium))
on the Class G-2 Certificates, after giving effect to the subordination
provisions of the Agreement and to the application of Prior Funds; and
(g) with respect to any Distribution Date (including any Special
Distribution Date or Election Distribution Date) which occurs during any Excess
Interest Period, the amount equal to the Excess Interest unpaid on such date.
"Due for Payment" shall mean the portion of the Insured Amounts which is
"Due for Payment" on any Distribution Date under this Policy; such portion shall
be equal to the Deficiency Amount existing for such Distribution Date.
"Election Distribution Date" shall mean any Special Distribution Date
established by reason of (i) the occurrence and continuation of a Policy
Provider Default occurring after a Notice of Insurer Election or (ii) the
receipt of a Special Payment constituting the proceeds of a Disposition relating
to a Series G-2 Equipment Note as to which a Notice of Insurer Election has been
given.
"Excess Interest" shall mean interest accrued on all outstanding Drawings
under the Class G-2 Primary Liquidity Facility (together with interest
previously accrued thereon), exclusive of any default interest, from and after
the first day of any Excess Interest Period to the date of determination.
"Excess Interest Period" shall mean, with respect to any Series G-2
Equipment Note and Drawing attributable thereto, the period commencing on the
day immediately following the end of the twenty-four (24) month period referred
to in clause (c) of the definition of "Deficiency Amount" with respect to any
such Series G-2 Equipment Note, and ending on the later to occur of (i) the
Class G-2 Final Legal Distribution Date and (ii) the date on which all
obligations owed to the Class G-2 Primary Liquidity Provider have been paid in
full.
"Holder" shall mean any person who is the registered owner or beneficial
owner of any of the Class G-2 Certificates or the Escrow Receipts attached
thereto and who, on the applicable Distribution Date, is entitled under the
terms of the Class G-2 Certificates or the Escrow Receipts attached thereto to
payment thereunder.
"Insolvency Proceeding" means the commencement, after the date hereof, of
any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of
assets and liabilities or similar proceedings by or against Continental
Airlines, Inc. or the Class G-2 Primary Liquidity Provider and the commencement,
after the date hereof, of any proceedings by Continental Airlines, Inc. or the
Class G-2 Primary Liquidity Provider for the winding up or liquidation of its
affairs or the consent, after the date hereof, to the appointment of a trustee,
conservator, receiver or liquidator in any bankruptcy, insolvency, readjustment
of debt, reorganization, marshalling of assets and liabilities or similar
proceedings of or relating to Continental Airlines, Inc. or the Class G-2
Primary Liquidity Provider.
"Insurance Agreement" shall mean the Insurance and Indemnity Agreement
dated as of March 25, 2002, by and among the Insurer, Continental Airlines, Inc.
and Wilmington Trust Company, not in its individual capacity, but solely as
Subordination Agent, as amended, modified or supplemented from time to time in
accordance with the terms thereof.
"Insurance Policy" or "Policy" shall mean the Certificate Guaranty
Insurance Policy of which this Endorsement is a part together with each and
every endorsement thereto.
"Insured Amount" shall mean, with respect to any Distribution Date, the
Deficiency Amount for such Distribution Date.
"Insured Obligations" shall mean the Class G-2 Certificates and the Escrow
Receipts attached thereto and Excess Interest.
"Insured Payments" shall mean, (i) with respect to any Distribution Date,
the aggregate amount actually paid by the Insurer to the Subordination Agent
(or, with respect to Insured Amounts in respect of amounts described in item (g)
of the definition of "Deficiency Amount", to the Class G-2 Primary Liquidity
Provider) in respect of the Insured Amount for such Distribution Date, and (ii)
the Preference Amount for any given Business Day.
"Insurer" shall mean Ambac Assurance Corporation, or any successor
thereto, as issuer of the Insurance Policy.
"Last Payment Date" shall have the meaning given to that term in subclause
(c) of the definition of "Deficiency Amount".
"Nonpayment" shall mean, with respect to any Distribution Date, a
Deficiency Amount owing to the Subordination Agent for distribution to the
Holders in respect of such Distribution Date or to the Class G-2 Primary
Liquidity Provider in respect of Excess Interest.
"Noti 