Document:

e60839820ex4_6.htm

 

 

 

 

 

REVOLVING CREDIT AGREEMENT

(2009-2B)

 

dated as of November 10, 2009

 

between

 

WILMINGTON TRUST COMPANY,

as Subordination Agent,

as Agent and Trustee for the

Continental Airlines Pass Through Trust 2009-2B,

as Borrower

 

and

 

NATIXIS S.A., ACTING THROUGH ITS NEW YORK BRANCH,

as Liquidity Provider

 

 

__________________________

 

Relating to Continental Airlines

Pass Through Trust 2009-2B 9.250% Continental Airlines

Pass Through Certificates, Series 2009-2B

__________________________

 

 

 

 

  

  

  

 

TABLE OF CONTENTS

 

Page

 

	
ARTICLE I  DEFINITIONS 
	
1

	
Section 1.01  Certain Defined Terms
	
1

	
 

ARTICLE II  AMOUNT AND TERMS OF THE COMMITMENT
	
 

7

	
Section 2.01  The Advances
	
7

	
Section 2.02  Making the Advances
	
7

	
Section 2.03  Fees
	
9

	
Section 2.04  Reductions or Termination of the Maximum Commitment
	
9

	
Section 2.05  Repayments of Interest Advances, the Special Termination Advance or the Final Advance
	
10

	
Section 2.06  Repayments of Provider Advances
	
11

	
Section 2.07  Payments to the 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

	
 

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
	
16

	
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

	
Section 4.03  Representations and Warranties
	
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 AND SPECIAL TERMINATION
	
 

22

 

 

 

i

BACK

 

TABLE OF CONTENTS

 

(continued)

Page

 

	
Section 6.01  Liquidity Events of Default
	
22

	
Section 6.02  Special Termination
	
22

	
 

ARTICLE VII  MISCELLANEOUS
	
 

23

	
Section 7.01  Amendments, Etc
	
23

	
Section 7.02  Notices, Etc
	
23

	
Section 7.03  No Waiver; Remedies
	
23

	
Section 7.04  Further Assurances
	
23

	
Section 7.05  Indemnification; Survival of Certain Provisions
	
23

	
Section 7.06  Liability of the Liquidity Provider
	
24

	
Section 7.07  Costs, Expenses and Taxes
	
25

	
Section 7.08  Binding Effect; Participations
	
25

	
Section 7.09  Severability
	
26

	
Section 7.10  GOVERNING LAW
	
26

	
Section 7.11  Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity
	
26

	
Section 7.12  Execution in Counterparts
	
27

	
Section 7.13  Entirety
	
28

	
Section 7.14  Headings
	
28

	
Section 7.15  Transfer
	
28

	
Section 7.16  LIQUIDITY PROVIDER’S OBLIGATION TO MAKE ADVANCES
	
28

	
Section 7.17  Patriot Act
	
28

	
Section 7.18  Head Office Obligations
	
28

	
Schedule A
	
-
	
Certain Economic Terms

	
Schedule B
	
-
	
Administration Details

	
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

	
Annex VII
	
-
	
Special Termination Advance Notice of Borrowing

	
Annex VIII
	
-
	
Notice of Special Termination

 

ii

BACK

REVOLVING CREDIT AGREEMENT (2009-2B)

 

THIS REVOLVING CREDIT AGREEMENT (2009-2B) dated as of November 10, 2009 (the “Agreement”), between WILMINGTON TRUST COMPANY, a Delaware
banking 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 B Trust (as defined below) (the “Borrower”), and NATIXIS S.A., a French societé anonyme, acting through its New York Branch (the “Liquidity
Provider”).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to the Class B 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 B Trust is issuing the Class B Certificates; and

 

WHEREAS, the Borrower, in order to support the timely payment of  a portion of the interest on the Class B Certificates in accordance with their terms, has requested the 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 Costs” has the meaning assigned to such term in Section 3.01.

 

“Advance” means an Interest Advance, a Final Advance, a Provider Advance, a Special Termination Advance, an Applied Special Termination 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(h).

 

“Applicable Margin” means (x) with respect to any Unpaid Advance (including, without limitation, any Applied Special Termination Advance but excluding any Unapplied Special Termination Advance) or Applied Provider Advance, the margin per annum
specified in item 1 of Schedule A, or (y) with respect to any Unapplied Provider Advance or any Unapplied Special Termination Advance, the margin per annum specified in the Fee Letter.

 

“Applied Downgrade Advance” has the meaning assigned to such term in Section 2.06(a).

 

 

  

BACK

 

“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).

 

“Applied Special Termination Advance” has the meaning assigned to such term in Section 2.05.

 

“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. 2009-2B-O,
dated as of the date hereof, relating to the Class B Trust.

 

“Base Rate” means, for any given day, 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 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 B Certificate is outstanding, the
city and state in which the Class B 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 in dollars are carried on in the London interbank market.

 

“Consent Period” has the meaning assigned to such term 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 The Bank of New York Mellon, as Depositary, pertaining to the Class B 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.

 

 

2

BACK

 

“Deposits” has the meaning assigned to such term in the Deposit Agreement.

 

“Downgrade Advance” means an Advance made pursuant to Section 2.02(c).

 

“Effective Date” has the meaning assigned to such term in Section 4.01.  The delivery of the certificate of the 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 Liquidity Provider or of its Facility Office by the jurisdiction where such 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 Liquidity Provider (including a transferee of an Advance) or Facility Office, after the date on which such successor 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 Liquidity Provider
failing to deliver to the Borrower any certificate or document (which certificate or document in the good faith judgment of the 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 the “Initial Expiry Date” specified in item 2 of Schedule A, initially, or any date to which the Expiry Date is extended pursuant to Section 2.10.

 

“Facility Office” means the office of the Liquidity Provider presently located at New York, New York, or such other office as the Liquidity Provider from time to time shall notify the Borrower as its Facility Office hereunder; provided that the
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.

 

 

3

BACK

 

“Head Office” has the meaning assigned to such term in Section 7.18.

 

“Intercreditor Agreement” means the Intercreditor Agreement dated as of the date hereof among the Trustees, the Liquidity Provider, the liquidity provider under the other Liquidity Facility 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 LIBOR Business Day following either (x) the date of the Liquidity Provider’s receipt of the Notice of Borrowing for such LIBOR Advance or (y) the date of the withdrawal of funds from the Class B Cash Collateral Account for
the purpose of paying interest on the Class B Certificates as contemplated by Section 2.06(a) hereof and, in either case, ending on the next Regular Distribution Date (or, if such day is not a Business Day, the next succeeding Business Day); and

 

(ii)           each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the next Regular Distribution Date (or, if such day is not a Business Day, the next succeeding Business Day);

 

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 LIBOR Business Day following the 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 (or, if such day is not a Business Day, the next succeeding Business Day) 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 Business Day” means any day on which dealings in dollars are carried on in the London interbank market.

 

“LIBOR Rate” means, with respect to any Interest Period,

 

(i)           the rate per annum appearing on display page Reuters Screen LIBOR01 Page (or any successor or substitute therefor) at approximately 11:00 a.m. (London time) two LIBOR 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 Liquidity Provider in the London interbank market at

 

 

4

BACK

 

approximately 11:00 a.m. (London time) two LIBOR 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 the amount specified in item 3 on Schedule A) or (b) a Continental Bankruptcy Event.

 

“Liquidity Indemnitee” means (i) the Liquidity Provider, (ii) the directors, officers, employees and agents of the Liquidity Provider, and (iii) the successors and permitted assigns of the persons described in clauses (i) and (ii)
inclusive.

 

“Liquidity Provider” has the meaning assigned to such term in the recital of parties to this Agreement.

 

“Maximum Available Commitment” means, 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, a Special Termination Advance or a Final Advance, the Maximum Available Commitment shall be zero.

 

“Maximum Commitment” means initially the amount specified in item 4 on Schedule A, as such amount may be reduced from time to time in accordance with Section 2.04(a).

 

“Natixis” has the meaning assigned to such term in Section 7.18.

 

“Non-Excluded Tax” has the meaning assigned to such term in Section 3.03(a).

 

“Non-Extension Advance” means an Advance made pursuant to Section 2.02(b).

 

“Notice of Borrowing” has the meaning assigned to such term in Section 2.02(e).

 

“Notice of Replacement Subordination Agent” has the meaning assigned to such term 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 Additional Equipment Notes issued under any Indenture) are Performing Equipment Notes.

 

“Prospectus Supplement” means the final Prospectus Supplement dated the date specified in item 5 on Schedule A relating to the Certificates, as such Prospectus Supplement may be amended or supplemented.

 

“Provider Advance” means a Downgrade Advance or a Non-Extension Advance.

 

“Rate Determination Notice” has the meaning assigned to such term in Section 3.07(g).

 

 

5

BACK

 

“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 B Certificates, that would be payable on the Class B Certificates on each
of the three successive semi-annual Regular Distribution Dates immediately following such day or, if such day is a Regular Distribution Date, on such day and the succeeding two semi-annual Regular Distribution Dates, in each case calculated on the basis of the Pool Balance of the Class B Certificates on such day and without regard to expected future distributions of principal on the Class B Certificates.

 

“Special Termination Advance” means an Advance made pursuant to Section 2.02(g).

 

“Special Termination Notice” means the Notice of Termination substantially in the form of Annex VIII to this Agreement.

 

“Successor Trust” means Continental Airlines Pass Through Trust 2009-2B-S.

 

“Termination Date” means the earliest to occur of the following:  (i) the Expiry Date; (ii) the date on which the Borrower delivers to the Liquidity Provider a certificate, signed by a Responsible Officer of the Borrower, certifying
that all of the Class B 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 Liquidity Provider a certificate, signed by a Responsible Officer of the Borrower, certifying that a Replacement Liquidity Facility has been substituted for this Agreement in full pursuant to Section 3.5(e)
of the Intercreditor Agreement; (iv) the fifth Business Day following the receipt by the Borrower of a Termination Notice or Special Termination Notice from the 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.

 

“Unapplied Special Termination Advance” means any Special Termination Advance other than an Applied Special Termination Advance.

 

 

6

BACK

 

“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”, “Additional Certificates”, “Additional Equipment
Notes”, “Aircraft”, “Bankruptcy Code”, “Certificate”, “Class A Certificates”, “Class
B Cash Collateral Account”, “Class B Certificates”, “Class B Trust”, “Class B Trust Agreement”, “Class B Trustee”, “Closing
Date”, “Continental”, “Continental Bankruptcy Event”, “Controlling Party”, “Corporate Trust Office”, “Delivery
Period Expiry Date”, “Downgraded Facility”, “Downgrade Event”, “Equipment Notes”, “Fee
Letter”, “Final Legal Distribution Date”, “Financing Agreement”, “Investment Earnings”, “Liquidity Facility”, “Liquidity
Obligations”, “Loan Trustee”, “Non-Extended Facility”, “Note Purchase Agreement”, “Operative Agreements”, “Participation
Agreement”, “Performing Equipment Note”, “Person”, “Pool Balance”, “Rating Agencies”, “Regular
Distribution Date”, “Replacement Liquidity Facility”, “Responsible Officer”, “Scheduled Payment”, “Special Payment”,
“Stated Interest Rate”, “Subordination Agent”, “Taxes”, “Threshold Rating”, “Transfer”,
“Trust Agreement”, “Trustee”, “Underwriters”, and “Underwriting Agreement”.

 

ARTICLE II

 

AMOUNT AND TERMS OF THE COMMITMENT

 

Section 2.01 The Advances.  The 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 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 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 B Certificates at the Stated Interest Rate therefor in accordance with Section 3.5(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 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 (x)

 

 

7

BACK

 

(i) a Liquidity Event of Default shall have occurred and be continuing and (ii) there is a Performing Note Deficiency or (y) a Final Advance, a Special Termination Advance, a Downgrade Advance or a Non-Extension Advance shall have been made or an Interest Advance shall have been converted into a Final Advance.

 

(b) A Non-Extension Advance shall be made in a single Borrowing if this Agreement is not extended in accordance with Section 3.5(d) of the Intercreditor Agreement (unless a Replacement Liquidity Facility to replace this Agreement
shall have been delivered to the Borrower as contemplated by said Section 3.5(d) within the time period specified in such Section) by delivery to the 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 B Cash Collateral Account in accordance with said Section 3.5(d) and Section 3.5(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 3.5(c) of the Intercreditor Agreement), unless a Replacement Liquidity Facility to replace this Agreement
shall have been previously delivered to the Borrower in accordance with said Section 3.5(c), by delivery to the 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 B Cash Collateral Account in accordance with said Section 3.5(c) and Section 3.5(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 B Trustee and Continental.

 

(d) A Final Advance shall be made in a single Borrowing upon the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01 hereof by delivery to the 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 B Cash Collateral Account (in accordance with Sections 3.5(f) and 3.5(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), 2.02(d) or 2.02(g), as the case may be, given by the Borrower to the 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 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.  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 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

 

 

8

BACK

 

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.  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 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 receipt of a copy thereof by the Liquidity Provider at the address specified pursuant to Section 7.02.

 

(f) Upon the making of any Advance requested pursuant to a Notice of Borrowing, in accordance with the Borrower’s payment instructions, the Liquidity Provider shall be fully discharged of its obligation hereunder with respect to
such Notice of Borrowing, and the 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 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 Section 2.02(e), the 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), (d) or (g) hereof to fund the Class B Cash Collateral Account, the Liquidity Provider shall have no interest in or rights to the Class B Cash Collateral Account, the funds constituting such Advance or any other amounts from time to time on deposit in the Class B 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 3.5(e) or (f) of the Intercreditor Agreement, and provided further, that the foregoing shall not affect or impair the rights of the Liquidity Provider to provide written instructions with respect to the investment and reinvestment of amounts in the Class B Cash Collateral Account 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 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.

 

(g) A Special Termination Advance shall be made in a single Borrowing upon the receipt by the Borrower of a Special Termination Notice from the Liquidity Provider pursuant to Section 6.02, by delivery to the Liquidity Provider of a written
and completed Notice of Borrowing in substantially the form of Annex VII, 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 B Cash Collateral Account (in accordance with Section 3.5(f) and Section 3.5(m) of the Intercreditor Agreement).

 

Section 2.03 Fees.  The Borrower agrees to pay to the 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 B
Certificates or otherwise, the Maximum Commitment shall automatically be reduced to an amount equal to such

 

 

9

BACK

 

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 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 Special Termination Advance or the making of or conversion to a Final Advance hereunder or the occurrence
of the Termination Date, the obligation of the 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, the Special Termination Advance 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 Liquidity Provider (which notice and demand are hereby waived by the Borrower), to pay, or to cause to be paid, to the Liquidity Provider on each date on which the Liquidity Provider shall make an Interest Advance, the Special Termination 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”) (if multiple Interest Advances are outstanding any such repayment to be applied in the order in which such Interest Advances have been made, starting with the earliest), plus (b) interest on the amount of each such Unpaid Advance as provided in Section 3.07 hereof; provided that if (i) the 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 Liquidity Provider in accordance with Section 2.06 and for the purposes of Section 2.06(b)); provided that amounts in respect of a Special Termination Advance withdrawn from the Class B Cash Collateral Account for the purpose of paying interest on the Class B Certificates in accordance with Section 3.5(f) of the Intercreditor Agreement (the amount of any such withdrawal being an “Applied Special Termination
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; and provided, further, that if, following the making of a Special Termination Advance, the Liquidity Provider delivers a Termination Notice to the Borrower pursuant to Section 6.01, such Special Termination Advance shall thereafter be converted to and 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 and treated as an Applied Special Termination Advance for purposes of Section 2.6(c) of the Intercreditor Agreement.  The Borrower and the Liquidity Provider agree that the repayment in full of each Interest Advance, the Special Termination 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 Liquidity Provider.

 

 

10

BACK

 

Section 2.06 Repayments of Provider Advances.  (a)  Amounts advanced hereunder in respect of a Provider Advance shall be deposited
in the Class B Cash Collateral Account, invested and withdrawn from the Class B Cash Collateral Account as set forth in Sections 3.5(c), (d), (e) and (f) of the Intercreditor Agreement.  Subject to Sections 2.07 and 2.09, the Borrower agrees to pay to the 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 B Cash Collateral Account for the purpose of paying interest on the Class B Certificates in accordance with Section 3.5(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 and the dates
on which such interest is payable; provided further, however, that if, following the making of a Provider Advance, the Liquidity Provider delivers a Termination Notice to the Borrower pursuant to Section 6.01 hereof, such Provider Advance shall thereafter be converted to and 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 and treated as an Applied Downgrade Advance or Applied Non-Extension
Advance, as the case may be, for the purposes of Section 2.6(c) of the Intercreditor Agreement.  Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal of any amounts from the Class B Cash Collateral Account on account of a reduction in the Required Amount, the Borrower shall repay to the Liquidity Provider a portion of the Provider Advances in a principal amount equal to the amount of 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 an Applied Special Termination Advance (or any portion thereof) is outstanding, upon the deposit in the Class B Cash Collateral Account of any amount pursuant to clause “fourth”
of Section 3.2 of the Intercreditor Agreement (any such amount being a “Replenishment Amount”) for the purpose of replenishing or increasing the balance thereof up to the amount of the Required Amount at such time, (i) the aggregate outstanding principal amount of all Applied Provider Advances or the Applied Special Termination Advance (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 (if multiple Applied Provider Advances are outstanding, such Replenishment Amount to be applied in the order in which such Applied Provider Advances have been made, starting with the earliest) and (ii) the aggregate outstanding principal amount of all Unapplied Provider Advances or of the Unapplied Special Termination Advance shall be automatically increased
by the amount of such Replenishment Amount.

 

(c) Upon the provision of a Replacement Liquidity Facility in replacement of this Agreement in accordance with Section 3.5(e) of the Intercreditor Agreement, amounts remaining on deposit in the Class B Cash Collateral Account after
giving effect to any Applied Provider Advance or Applied Special Termination Advance on the date of such replacement shall be

 

 

11

BACK

 

reimbursed to the replaced Liquidity Provider, but only to the extent such amounts are necessary to repay in full to the replaced Liquidity Provider all amounts owing to it hereunder.

 

Section 2.07 Payments to the Liquidity Provider Under the Intercreditor Agreement.  In order to provide for payment or repayment to the 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 Liquidity Provider pursuant to the terms of the Intercreditor Agreement (including, without limitation, Section 3.5(f) of the Intercreditor Agreement), shall be paid to the Liquidity Provider in accordance with the terms thereof.  Amounts so paid to, and not required to be returned by, the Liquidity
Provider shall be applied by the Liquidity Provider to Liquidity Obligations then due and payable in accordance with the Intercreditor Agreement and shall discharge in full the corresponding obligations of the Borrower hereunder (or, if not provided for in the Intercreditor Agreement, then in such manner as the Liquidity Provider shall deem appropriate).

 

Section 2.08 Book Entries.  The 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 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, including, without limitation,
Sections 7.05 and 7.07, shall be made only from the amounts that constitute Scheduled Payments, Special Payments or payments under Section 8.1 of the Participation Agreements and payments under the Fee Letter and 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 Liquidity Provider agrees that it will look solely to such amounts in respect of payments to be made by the Borrower hereunder 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 B 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 3.5(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 B Certificates), the Borrower shall request that the 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 B 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 Liquidity Provider shall advise the Borrower no earlier than

 

 

12

BACK

 

the 40th day (or, if earlier, the date of the 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 Liquidity Provider advises the Borrower 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 Liquidity Provider shall not have been replaced in accordance with Section 3.5(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 3.5(d) of the Intercreditor Agreement.

 

ARTICLE III 

 

OBLIGATIONS OF THE BORROWER

 

Section 3.01 Increased Costs.  The Borrower shall pay to the Liquidity Provider from time to time such amounts as may be necessary to compensate
the Liquidity Provider for any increased costs incurred by the Liquidity Provider which are attributable to its making or maintaining any Advances hereunder or its obligation to make any such Advances hereunder, or any reduction in any amount receivable by the 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 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 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 Liquidity Provider (including any such Advances or such obligation or any deposits referred to in the definition of LIBOR Rate or related definitions).  The 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 Liquidity Provider, be otherwise disadvantageous to the Liquidity Provider.

 

The Liquidity Provider will notify the Borrower of any event occurring after the date of this Agreement that will entitle the 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 Liquidity Provider for purposes of this Section 3.01 of the effect of any Regulatory Change on its costs of making or maintaining

 

 

13

BACK

 

Advances or on amounts receivable by it in respect of Advances, and of the additional amounts required to compensate the 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 Liquidity Provider and the Subordination Agent agree that any permitted assignee or participant of the initial 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 Liquidity Provider or any corporation or bank controlling the 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 (x) requiring an increase in the amount of capital required to be maintained by the Liquidity Provider or any corporation or bank controlling the Liquidity Provider, or (y) reducing the rate of return on assets or capital of the Liquidity Provider (or such corporation or bank) and such adoption, change or compliance, as the case may be, relates to a category of claims or assets that includes
the Liquidity Provider’s obligations hereunder (including funded obligations) and other similar obligations, the Borrower shall, subject to the provisions of the next paragraph, pay to the Liquidity Provider from time to time such additional amount or amounts as are necessary to compensate the Liquidity Provider for such portion of such increase or reduction as shall be reasonably allocable to the Liquidity Provider’s obligations to the Borrower hereunder.  For the avoidance of doubt, the
proposals of The Basel Committee on Banking Supervision relating to capital adequacy rules commonly known as Basel II will not be treated for purposes of determining whether the Liquidity Provider (or any corporation or bank controlling the Liquidity Provider) is entitled to compensation under this Section 3.02 as having been adopted or having come into effect before the date hereof, which rules shall be determined to be adopted only when the national banking authorities, or other relevant administrative or legislative
bodies having primary jurisdiction or regulatory authority over the Liquidity Provider (or any corporation or bank controlling the Liquidity Provider), adopt Basel II in the primary jurisdiction of the Liquidity Provider.  The 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 Liquidity Provider, be otherwise materially disadvantageous to the Liquidity Provider.

 

The Liquidity Provider will notify the Borrower of any event occurring after the date of this Agreement that will entitle the 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 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 Liquidity Provider and of the amount allocable to the Liquidity Provider’s obligations to the

 

 

14

BACK

 

Borrower hereunder shall be conclusive evidence of the amounts owed under this Section, absent manifest error.

 

Notwithstanding the preceding two paragraphs, the Liquidity Provider and the Subordination Agent agree that any permitted assignee or participant of the initial 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 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 Liquidity Provider shall be increased to the extent necessary to yield to the 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 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 Liquidity Provider, be otherwise disadvantageous to the Liquidity Provider.  From time to time upon the reasonable request of the Borrower, the Liquidity Provider agrees to provide
to the Borrower two original Internal Revenue Service Forms W-8BEN, W-8ECI or W-9, as appropriate, or any successor or other form prescribed by the Internal Revenue Service, certifying that the 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 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 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 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

 

 

15

BACK

 

deduction been made.  Within 30 days after the date of each payment hereunder, the 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 Liquidity Provider such form or forms and such other evidence of the eligibility of the Borrower for such exemption or reduction as the 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 Liquidity Provider under this Agreement so as to cause
the same to be received by the 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 Liquidity Provider in immediately available funds, by wire transfer to the account specified for the Liquidity Provider in Schedule B or to such other U.S. bank account as the Liquidity Provider may from time to time direct the Subordination Agent in writing.

 

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 to the Liquidity Provider 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.  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 or Applied Special Termination Advance, from and including the date on which the amount thereof was withdrawn from the Class B Cash Collateral Account to pay interest on the Class B Certificates) to but excluding the date such principal amount shall be paid in full (or, in the case of an Applied Provider Advance or Applied Special Termination Advance, the
date on which the Class B 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

 

 

16

BACK

 

(as defined below) for such Advance or such other amount, as the case may be, 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 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 LIBOR Business Day following the 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 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 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 B 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% per annum until paid.

 

 

17

BACK

 

(g) If at any time, the Liquidity Provider shall have determined (which determination shall be conclusive and binding upon the Borrower, absent manifest error) that, by reason of circumstances affecting the relevant interbank lending
market generally, the LIBOR Rate determined or to be determined for the current or the immediately succeeding Interest Period will not adequately and fairly reflect the cost to the Liquidity Provider (as conclusively certified by the Liquidity Provider, absent manifest error) of making or maintaining LIBOR Advances, the Liquidity Provider shall give facsimile or telephonic notice thereof (a “Rate Determination Notice”)
to the Borrower (any such telephonic notice to be promptly confirmed in writing and transmitted by telecopier to the Borrower in accordance with Section 7.02).  If such notice is given, then the outstanding principal amount of the LIBOR Advances shall be converted to Base Rate Advances effective from the date of the Rate Determination Notice; provided that the Applicable Liquidity Rate in respect of such Base Rate Advances shall be increased
by one percent (1.00%).  The Liquidity Provider shall withdraw a Rate Determination Notice given hereunder when the Liquidity Provider determines that the circumstances giving rise to such Rate Determination Notice no longer apply to the Liquidity Provider, and the Base Rate Advances shall be converted to LIBOR Advances effective as of the first day of the next succeeding Interest Period after the date of such withdrawal.

 

(h) 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 Liquidity Provider by the then Borrower, the successor Borrower designated therein shall
be substituted for the Borrower for all purposes hereunder.

 

Section 3.09 Funding Loss Indemnification.  The Borrower shall pay to the Liquidity Provider, upon the request of the Liquidity Provider, such
amount or amounts as shall be sufficient (in the reasonable opinion of the 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 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.

 

Calculation of all amounts payable to the Liquidity Provider under this Section 3.09 shall be made as though the Liquidity Provider had actually funded the related LIBOR Advance through the purchase of a LIBOR deposit bearing interest at the LIBOR Rate in an amount equal to its LIBOR Advance and having a maturity comparable to the relevant
Interest

 

 

18

BACK

 

Period; provided however, that the Liquidity Provider may fund any LIBOR Advance in any manner it sees fit and the foregoing assumptions shall be utilized only for the purposes of calculating amounts payable under this Section 3.09.

 

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 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 Liquidity Provider (or its Facility Office) to maintain or fund its LIBOR Advances, then upon
notice to the Borrower by the Liquidity Provider, the outstanding principal amount of the LIBOR Advances shall be converted to Base Rate Advances (a) immediately upon demand of the Liquidity Provider, if such change or compliance with such request, in the judgment of the 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 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 Liquidity Provider, be otherwise disadvantageous to the 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 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 Liquidity Provider:

 

(i) This Agreement duly executed on behalf of the Borrower and the Fee Letter applicable to this Agreement duly executed on behalf of the Borrower and Continental;

 

(ii) The Intercreditor Agreement duly executed on behalf of each of the parties thereto (other than the Liquidity Provider);

 

(iii) Fully executed copies of each of the Operative Agreements executed and delivered on or before the Closing Date (other than this Agreement, the Fee Letter and the Intercreditor Agreement);

 

(iv) A copy of the Prospectus Supplement and specimen copies of the Class B Certificates;

 

(v) An executed copy of each document, instrument, certificate and opinion delivered on or before the Closing Date pursuant to the Class B Trust Agreement, the Note

 

 

19

BACK

 

Purchase 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 Liquidity Provider or accompanied by a letter from the counsel rendering such opinion to the effect that the Liquidity Provider is entitled to
rely on such opinion as of its date as if it were addressed to the 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 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 Liquidity Provider created by the Operative Agreements executed and delivered on or before the Closing Date;

 

(vii) An agreement from Continental, pursuant to which (i) Continental agrees to provide to the 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 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 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 Liquidity Provider to inspect Continental’s books and records regarding such transactions, and to discuss such transactions with officers and employees of Continental;

 

(viii) Legal opinions from (a) Richards, Layton & Finger, P.A., special counsel to the Borrower, and (b) Hughes Hubbard & Reed LLP, special counsel to Continental, each in form and substance reasonably satisfactory to the Liquidity
Provider; and

 

(ix) Such other documents, instruments, opinions and approvals pertaining to the transactions contemplated hereby or by the other Operative Agreements as the Liquidity

 

 

20

BACK

 

Provider shall have reasonably requested, including, without limitation, such documentation as the Liquidity Provider may require to satisfy its “know your customer” policies.

 

(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 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 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, all conditions precedent to the effectiveness of the other Liquidity Facility shall have been concurrently
satisfied or waived, and all conditions precedent to the purchase of the Class A Certificates and the Class B 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 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 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 Advance requested.

 

Section 4.03 Representations and Warranties.  The representations and warranties of the Borrower as Subordination Agent in Section 5.2 of the
Participation Agreements shall be deemed to be incorporated into this Agreement as if set out in full herein and as if such representations and warranties were made by the Borrower to the Liquidity Provider.

 

ARTICLE V

 

COVENANTS

 

Section 5.01 Affirmative Covenants of the Borrower.  So long as any Advance shall remain unpaid or the Liquidity Provider shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount to the Liquidity Provider hereunder, the Borrower will, unless the 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.

 

 

21

BACK

 

(b) Reporting Requirements.  Furnish to the Liquidity Provider with reasonable promptness, such information and data with respect to the transactions contemplated
by the Operative Agreements as from time to time may be reasonably requested by the Liquidity Provider; and permit the 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 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 Liquidity Provider.

 

Section 5.02 Negative Covenants of the Borrower.  So long as any Advance shall remain unpaid or the Liquidity Provider shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount to the 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 Liquidity Provider, which consent shall not be unreasonably withheld or delayed.

 

ARTICLE VI 

 

LIQUIDITY EVENTS OF DEFAULT AND SPECIAL TERMINATION

 

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 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 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 Liquidity Provider to promptly make, a Final Advance in accordance with Section 2.02(d) hereof and Section 3.5(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 Liquidity Provider.

 

Section 6.02 Special Termination.  If the aggregate Pool Balance of the Class B Certificates is greater than the aggregate outstanding principal
amount of the Series B Equipment Notes (other than any Series B Equipment Notes previously sold or with respect to which the collateral securing such Series B Equipment Notes has been disposed of) at any time during the 18 month period prior to May 10, 2017 the Liquidity Provider may, in its discretion, deliver to the Borrower a Special Termination Notice, the effect of which shall be to cause (i) the obligation of the Liquidity Provider to make Advances hereunder to expire on the fifth Business Day after the
date on which such Special Termination Notice is received by the Borrower, (ii) the Borrower to promptly request, and the Liquidity Provider to promptly make, a Special Termination Advance in accordance with Section 2.02(g) and Section 3.5(m) of the Intercreditor Agreement, and (iii) subject to Sections 2.07 and 2.09, all Advances (including, without

 

 

22

BACK

 

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 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 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) addressed to the applicable party at its address specified on Schedule B or to such other address as shall be designated by such Person in a written notice to the others.  The Borrower shall give all Notices of Borrowing via telecopier; provided, that, in the event of a transmission failure, the Borrower shall use reasonable efforts to deliver the applicable
Notice of Borrowing to the Liquidity Provider on the same Business Day using such other means as may be reasonably deemed necessary by the Borrower.  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, five Business Days after being 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 Liquidity Provider pursuant to the provisions of Article II and Article III hereof shall not be effective until received by the 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 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 Liquidity Provider
such additional assignments, agreements, powers and instruments as the 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 Liquidity Provider its rights, powers and remedies hereunder and under the other Operative Agreements.

 

Section 7.05 Indemnification; Survival of Certain Provisions.  The Liquidity Provider shall be indemnified hereunder to the extent and in the
manner described in Section 8.1 of the

 

 

23

BACK

 

Participation Agreements.  In addition, the Borrower agrees to indemnify, protect, defend and hold harmless the 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, 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 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 Liquidity Provider.  (a)  Neither the 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 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 Liquidity Provider, and the 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 Liquidity Provider’s willful misconduct or negligence in determining whether
documents presented hereunder comply with the terms hereof, or (B) any breach by the Liquidity Provider of any of the terms of this Agreement, including, but not limited to, the 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.  In no event, however, shall the Liquidity Provider be liable on any theory of liability for any special, indirect, consequential
or punitive damages (including, without limitation, any loss of profits, business or anticipated savings).

 

(b) Neither the 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 gross negligence (in which event the extent of the 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.

 

 

24

BACK

 

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 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 Liquidity Provider) of the 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 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 any waiver or consent thereunder (whether or not the same shall be effective), (iii) the
replacement of this Agreement by a Replacement Liquidity Facility pursuant to Section 3.5(e)(i) of the Intercreditor Agreement or (iv) any action or proceeding relating to any order, injunction, or other process or decree restraining or seeking to restrain the 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 B 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 hold the 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 Liquidity Provider and their respective successors and assigns, except that neither the Liquidity Provider (except as otherwise provided in this Section 7.08 and in Section 3.5(l) of the Intercreditor Agreement) 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 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 Liquidity Provider may in its sole discretion select, subject to the requirements of Section 7.08(b).  No such granting of participations by the Liquidity Provider, however, will relieve the Liquidity Provider
of its obligations hereunder.  In connection with any participation or any proposed participation, the 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 Liquidity Provider pursuant to this Agreement.  The Borrower acknowledges and agrees that the 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 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 Liquidity Provider directly if the Liquidity Provider, rather than the participant, had held the
interest participated).

 

 

25

BACK

 

(b) If, pursuant to subsection (a) above, the 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 Liquidity Provider (for the benefit of the 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 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, Form W-8BEN or Form W-9, 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 Liquidity Provider and the Borrower) to provide the Liquidity Provider and the Borrower a new Form W-8ECI, Form W-8BEN or Form W-9, 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-8ECI, Form W-8BEN or Form W-9 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 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 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 Liquidity Provider from its obligations
hereunder.

 

Section 7.09 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 7.10 GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

Section 7.11 Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity.  (a) Each
of the parties hereto hereby irrevocably and unconditionally:

 

 

26

BACK

 

(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 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 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 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) To the extent that the Liquidity Provider or any of its properties has or may hereafter acquire any right of immunity, whether characterized as sovereign immunity or otherwise, and whether under the United States Foreign Sovereign
Immunities Act of 1976 (or any successor legislation) or otherwise, from any legal proceedings, whether in the United States or elsewhere, to enforce or collect upon this Agreement, including, without limitation, immunity from suit or service of process, immunity from jurisdiction or judgment of any court or tribunal or execution of a judgment, or immunity of any of its property from attachment prior to any entry of judgment, or from attachment in aid of execution upon a judgment, the Liquidity Provider hereby
irrevocably and expressly waives any such immunity, and agrees not to assert any such right or claim in any such proceeding, whether in the United States or elsewhere.

 

Section 7.12 Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by different parties hereto on separate
counterparts, each of which

 

 

27

BACK

 

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 7.13 Entirety.  This Agreement, the Intercreditor Agreement and the other Operative Agreements to which the 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 7.14 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 7.15 Transfer.  The Liquidity Provider hereby acknowledges and consents to the Transfer contemplated by the Assignment and Assumption
Agreement.

 

Section 7.16 LIQUIDITY PROVIDER’S OBLIGATION TO MAKE ADVANCES.  EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS OF THE
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.

 

Section 7.17 Patriot Act.  In compliance with the USA Patriot Act and 31 CFR Part 103.121 and, in the case of a non-U.S. entity, any other similar
requirements of the relevant foreign jurisdiction, when requested the Borrower shall provide to the Liquidity Provider certain information relating to the Borrower that the Liquidity Provider may be required to obtain and keep on file, including the Borrower’s name, address and various identifying documents.

 

Section 7.18 Head Office Obligations.  The Liquidity Provider is Natixis S.A., a French bank (“Natixis”),
acting through its New York Branch.  The Liquidity Provider hereby agrees that, notwithstanding the place of booking or its jurisdiction of incorporation or organization, the obligations of the Liquidity Provider hereunder are also the obligations of the head office of Natixis in Paris, France (the “Head Office”). Accordingly, any beneficiary of this Agreement will be able to proceed directly against the
Head Office, if the Liquidity Provider defaults in its obligations to such beneficiary under this Agreement.

 

 

 

28

BACK

 

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 B Trust,as Borrower

	  	  
	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  
	  	  
	  	  
	  	  
	  	
NATIXIS S.A., ACTING THROUGH

ITS NEW YORK BRANCH,

as Liquidity Provider

	  	  
	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  
	  	  
	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  

 

29

BACK

 

SCHEDULE A

TO

REVOLVING CREDIT AGREEMENT

 

CERTAIN ECONOMIC TERMS

 

1.           Applicable Margin (Unpaid Advance (including, without limitation, any Applied Special Termination Advance but excluding any Unapplied Special Termination Advance)/Applied Provider Advance):   4.00% per annum.

2.           Initial Expiry Date:   November 8, 2010.

3.           Liquidity Event of Default Delivery Period threshold:   $240,000,000.

4.           Initial Maximum Commitment:   $16,207,665.

5.           Prospectus Supplement date:   October 27, 2009.

 

SCHEDULE A

Page 1

BACK

 

SCHEDULE B

TO

REVOLVING CREDIT AGREEMENT

 

ADMINISTRATION DETAILS

 

	
Borrower:
	
WILMINGTON TRUST COMPANY

	
Address:
	
Rodney Square North

1100 North Market Square

Wilmington, DE 19890-1605

Attention:  Corporate Capital Market Services

Telephone:  (302) 636-6296

Telecopy:   (302) 636-4140

 

	
Liquidity Provider:
	
NATIXIS S.A., ACTING THROUGH ITS NEW YORK BRANCH

Address:                        Attention: Lily Cheung

9 West 57th Street, 35th Floor

New York, NY 10019

Telephone: (212) 891-1948

Telecopy: (212) 891-1900

cc: CAL2009_2_Report@us.natixis.com

and

Attention: Martha Sealy

1251 Avenue of the Americas

New York, NY 10020

Tel:  (212) 872-5031

Fax: (347) 402-3031

	
Account Details:
	
JP MORGAN CHASE BANK, New York, NY

ABA No. 021-000-021

For Account of Natixis, NY Branch

Account #:544-7-75330

Reference to: Continental Airlines EETC 2009-2

 

SCHEDULE B
Page 1

BACK

 

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 NATIXIS S.A., acting through its New York Branch (the “Liquidity
Provider”), with reference to the Revolving Credit Agreement (2009-2B) dated as of November 10, 2009, between the Borrower and the 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 Liquidity Provider to be used, subject to clause (3)(v) below, for the payment of  interest on the Class B Certificates which was payable on ____________, ____  (the
“Distribution Date”) in accordance with the terms and provisions of the Class B Trust Agreement and the Class B Certificates, which Advance is requested to be made on [____________, ____]1.  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 B Certificates on the Distribution Date, (ii) does not include any amount with respect to
the payment of principal of, or premium on, the Class B Certificates, or principal of, or interest or premium on, the Class A Certificates or any Additional Certificates, (iii) was computed in accordance with the provisions of the Class B Certificates, the Liquidity Agreement, the Class B 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 B 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

_______________

 
1 If a Notice of Borrowing will be delivered prior to 1:00 p.m. (New York City time) on a Business Day, insert the date of the Notice of Borrowing.  If a Notice of Borrowing will be delivered after 1:00 p.m. (New York City time) on a Business Day or
on a day that is not a Business Day, insert the first Business Day after the date of the Notice of Borrowing.

 

 

Annex I

Page 1

BACK

 

Section 3.5(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.

 

 

Annex I

Page 2

BACK

 

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:
	  

 

Annex I

Page 3

BACK

 

SCHEDULE I

TO

INTEREST ADVANCE NOTICE OF BORROWING

 

[Insert copy of computations in accordance with Interest Advance Notice of Borrowing]

 

 

Annex I

Page 4

BACK

 

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 NATIXIS S.A., acting through its New York Branch (the “Liquidity
Provider”), with reference to the Revolving Credit Agreement (2009-2B) dated as of November 10, 2009, between the Borrower and the 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 Liquidity Provider to be used for the funding of the Class B Cash Collateral Account in accordance with Section 3.5(d) of the Intercreditor Agreement, which Advance
is requested to be made on [__________, ____]2.  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 B Cash Collateral Account in accordance with Section 3.5(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 B Certificates, or principal of, or interest or premium on, the Class A Certificates or any Additional Certificates, (iii) was computed in accordance with the provisions of the Class B Certificates, the Liquidity Agreement, the Class B 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 B Cash Collateral Account and apply the same in accordance with the terms of Section 3.5(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.

_______________

 
2 If a Notice of Borrowing will be delivered prior to 1:00 p.m. (New York City time) on a Business Day, insert the date of the Notice of Borrowing.  If a Notice of Borrowing will be delivered after 1:00
p.m. (New York City time) on a Business Day or on a day that is not a Business Day, insert the first Business Day after the date of the Notice of Borrowing.

 

 

Annex II
Page 1

BACK

 

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 Liquidity Provider to make further Advances under the Liquidity Agreement; and (B) following the making
by the 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.

 

 

Annex II

Page 2

BACK

 

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:
	  

 

Annex II

Page 3

BACK

 

SCHEDULE I

TO

NON-EXTENSION ADVANCE NOTICE OF BORROWING

 

[Insert copy of computations in accordance with Non-Extension Advance Notice of Borrowing]

 

 

Annex II

Page 4

BACK

 

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 NATIXIS S.A., acting through its New York Branch (the “Liquidity
Provider”), with reference to the Revolving Credit Agreement (2009-2B) dated as of November 10, 2009, between the Borrower and the 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 Liquidity Provider to be used for the funding of the Class B Cash Collateral Account in accordance with Section 3.5(c) of the Intercreditor Agreement by reason of the
occurrence of a Downgrade Event, which Advance is requested to be made on [__________, ____]3.  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 B Cash Collateral Account in accordance with Section 3.5(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 B Certificates, or principal of, or interest or premium on, the Class A Certificates or any Additional Certificates, (iii) was computed in accordance with the provisions of the Class B Certificates, the Liquidity Agreement, the Class B 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 B Cash Collateral Account and apply the same in accordance with the terms of Section 3.5(c) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower

_______________

 
3 If a Notice of Borrowing will be delivered prior to 1:00 p.m. (New York City time) on a Business Day, insert the date of the Notice of Borrowing.  If a Notice of Borrowing will be delivered after 1:00
p.m. (New York City time) on a Business Day or on a day that is not a Business Day, insert the first Business Day after the date of the Notice of Borrowing.

 

 

Annex III

Page 1

BACK

 

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 Liquidity Provider to make further Advances under the Liquidity Agreement; and (B) following the making by
the 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.

 

 

Annex III

Page 2

BACK

 

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:
	  

 

Annex III

Page 3

BACK

 

SCHEDULE I

TO

DOWNGRADE ADVANCE NOTICE OF BORROWING

 

[Insert copy of computations in accordance with Downgrade Advance Notice of Borrowing]

 

 

Annex III

Page 4

BACK

 

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 NATIXIS S.A., acting through its New York Branch (the “Liquidity
Provider”), with reference to the Revolving Credit Agreement (2009-2B) dated as of November 10, 2009, between the Borrower and the 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 Liquidity Provider to be used for the funding of the Class B Cash Collateral Account in accordance with Section 3.5(i) of the Intercreditor Agreement by reason of the receipt
by the Borrower of a Termination Notice from the Liquidity Provider with respect to the Liquidity Agreement, which Advance is requested to be made on [____________, ____]4.  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 B Cash Collateral Account in accordance with Section 3.5(i)
of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class B Certificates, or principal of, or interest or premium on, the Class A Certificates or any Additional Certificates, (iii) was computed in accordance with the provisions of the Class B Certificates, the Liquidity Agreement, the Class B 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 B Cash Collateral Account and apply the same in accordance with the terms of Section 3.5(i) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower

_______________

 
4 If a Notice of Borrowing will be delivered prior to 1:00 p.m. (New York City time) on a Business Day, insert the date of the Notice of Borrowing.  If a Notice of Borrowing will be delivered after 1:00
p.m. (New York City time) on a Business Day or on a day that is not a Business Day, insert the first Business Day after the date of the Notice of Borrowing.

 

 

Annex IV

Page 1

BACK

 

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 Liquidity Provider to make further Advances under the Liquidity Agreement; and (B) following the making by the
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.

 

 

Annex IV

Page 2

BACK

 

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:
	  

 

Annex IV

Page 3

BACK

 

SCHEDULE I

TO

FINAL ADVANCE NOTICE OF BORROWING

 

[Insert copy of computations in accordance with Final Advance Notice of Borrowing]

 

 

Annex IV

Page 4

BACK

 

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 November 10, 2009 between Wilmington Trust Company, as Subordination Agent, as agent and trustee for the Continental Airlines Pass Through Trust, 2009-2B-[O/S], as Borrower, and NATIXIS S.A., acting through its New York Branch (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, we are giving this notice to you in order to cause (i) our obligations to make Advances 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 3.5(i) of the Intercreditor Agreement as a consequence of your receipt of this notice.

 

Terms used but not defined herein shall have the respective meanings ascribed thereto in or pursuant to the Liquidity Agreement.

 

 

Annex V

Page 1

BACK

 

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,

 

NATIXIS S.A., ACTING THROUGH

ITS NEW YORK BRANCH, as Liquidity

Provider

	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  
	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  

 

	
cc:
	
Wilmington Trust Company,

as Class B Trustee

 

 

Annex V

Page 2

BACK

 

ANNEX VI

TO

REVOLVING CREDIT AGREEMENT

 

NOTICE OF REPLACEMENT SUBORDINATION AGENT

 

[Date]

Attention:

 

Revolving Credit Agreement dated as of November 10, 2009, between Wilmington Trust Company, as Subordination Agent, as agent and trustee for the Continental Airlines Pass Through Trust, 2009-2B-[O/S], as Borrower, and NATIXIS S.A., acting through its New York Branch (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:
	  

 

Annex VI

Page 1

BACK

 

ANNEX VII

TO

REVOLVING CREDIT AGREEMENT

 

SPECIAL TERMINATION ADVANCE NOTICE OF BORROWING

 

The undersigned, a duly authorized signatory of the undersigned borrower (the “Borrower”), hereby certifies to NATIXIS S.A., acting through its New York Branch (the “Liquidity
Provider”), with reference to the Revolving Credit Agreement (2009-2B) dated as of November 10, 2009, between the Borrower and the 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 Special Termination Advance by the Liquidity Provider to be used for the funding of the Class B Cash Collateral Account in accordance with Section 3.5(m) of the Intercreditor Agreement by reason
of the receipt by the Borrower of a Special Termination Notice from the Liquidity Provider with respect to the Liquidity Agreement, which Advance is requested to be made on [____________, ____]5.  The Special Termination Advance should be transferred to [name of bank/wire instructions/ABA number] in favor of account number [    ], reference [         ].

 

(3)           The amount of the Special Termination 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 B Cash Collateral Account in accordance with Section 3.5(m)
of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class B Certificates, or principal of, or interest or premium on, the Class A Certificates or any Additional Certificates, (iii) was computed in accordance with the provisions of the Class B Certificates, the Liquidity Agreement, the Class B 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 B Cash Collateral Account and apply the same in accordance with the terms of Section 3.5(m) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower

_______________

 
5 If a Notice of Borrowing will be delivered prior to 1:00 p.m. (New York City time) on a Business Day, insert the date of the Notice of Borrowing.  If a Notice of Borrowing will be delivered after 1:00
p.m. (New York City time) on a Business Day or on a day that is not a Business Day, insert the first Business Day after the date of the Notice of Borrowing.

 

 

Annex VII

Page 1

BACK

 

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 Special Termination Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the Liquidity Provider to make further Advances under the Liquidity Agreement; and (B) following the
making by the Liquidity Provider of the Special Termination Advance requested by this Notice of Borrowing, the Borrower shall not be entitled to request any further Advances under the Liquidity Agreement.

 

 

Annex VII

Page 2

BACK

 

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:
	  

 

Annex VII

Page 3

BACK

 

SCHEDULE I

TO

SPECIAL TERMINATION ADVANCE NOTICE OF BORROWING

 

[Insert copy of computations in accordance with Special Termination Advance Notice of Borrowing]

 

Annex VII

Page 4

BACK

 

ANNEX VIII

 

TO

 

REVOLVING CREDIT AGREEMENT

 

NOTICE OF SPECIAL 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 November 10, 2009 between Wilmington Trust Company, as Subordination Agent, as agent and trustee for the Continental Airlines Pass Through Trust, 2009-2B-[O/S], as Borrower, and NATIXIS S.A., acting through its New York Branch (the “Liquidity
Agreement”)

 

Ladies and Gentlemen:

 

You are hereby notified that pursuant to Section 6.02 of the Liquidity Agreement, by reason of the aggregate Pool Balance of the Class B Certificates exceeding the aggregate outstanding principal amount of the Series B Equipment Notes (other than any Series B Equipment Notes previously sold or with respect to which the collateral securing
such Series B Equipment Notes has been disposed of) during the 18 month period prior to May 10, 2017, we are giving this notice to you in order to cause (i) our obligations to make Advances under the Liquidity Agreement to terminate on the fifth Business Day after the date on which you receive this notice and (ii) you to request a Special Termination Advance under the Liquidity Agreement pursuant to Section 3.5(m) of the Intercreditor Agreement as a consequence of your receipt of this notice.  Terms
used but not defined herein shall have the respective meanings ascribed thereto in or pursuant to the Liquidity Agreement.

 

 

Annex VIII

Page 1

BACK

 

THIS NOTICE IS THE “NOTICE OF SPECIAL 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,

 

NATIXIS S.A., ACTING THROUGH ITS NEW YORK 

BRANCH, as Liquidity Provider

	  	  
	  	
By:
	  
	  	  	
Name:
	  
	  	  	
Title:
	  

 

	
cc:
	
Wilmington Trust Company,

as Class B Trustee

 

 

 

Annex VIII

Page 2e60839820ex4_7.htm

 

 

 

 

 

 

 

INTERCREDITOR AGREEMENT

(2009-2)

Dated as of

November 10, 2009

AMONG

WILMINGTON TRUST COMPANY,

not in its individual capacity

but solely as Trustee under the

Continental Airlines Pass Through Trust 2009-2A

and

Continental Airlines Pass Through Trust 2009-2B

NATIXIS S.A., ACTING THROUGH ITS NEW YORK BRANCH,

as Class A Liquidity Provider

and

as Class B Liquidity Provider

AND

WILMINGTON TRUST COMPANY,

not in its individual capacity except

as expressly set forth herein but

solely as Subordination Agent and Trustee

 

 

 

  

  

  

TABLE OF CONTENTS

Page

 

	
ARTICLE I  DEFINITIONS
	
2

	
SECTION 1.1.  Definitions
	
2

	
 

ARTICLE II  TRUST ACCOUNTS; CONTROLLING PARTY
	
 

19

	
SECTION 2.1.  Agreement to Terms of Subordination; Payments from Monies Received Only
	
19

	
SECTION 2.2.  Trust Accounts
	
20

	
SECTION 2.3.  Deposits to the Collection Account and Special Payments Account
	
21

	
SECTION 2.4.  Distributions of Special Payments
	
21

	
SECTION 2.5.  Designated Representatives
	
23

	
SECTION 2.6.  Controlling Party
	
23

	
 

ARTICLE III  RECEIPT, DISTRIBUTION AND APPLICATION  OF AMOUNTS RECEIVED
	
 

25

	
SECTION 3.1.  Written Notice of Distribution
	
25

	
SECTION 3.2.  Distribution of Amounts on Deposit in the Collection Account
	
26

	
SECTION 3.3.  Other Payments
	
29

	
SECTION 3.4.  Payments to the Trustees and the Liquidity Providers
	
29

	
SECTION 3.5.  Liquidity Facilities
	
30

	
 

ARTICLE IV  EXERCISE OF REMEDIES
	
 

36

	
SECTION 4.1.  Directions from the Controlling Party
	
36

	
SECTION 4.2.  Remedies Cumulative
	
38

	
SECTION 4.3.  Discontinuance of Proceedings
	
38

	
SECTION 4.4.  Right of Certificateholders and the Liquidity Providers to Receive Payments Not to Be Impaired
	
39

	
SECTION 4.5.  Undertaking for Costs
	
39

	
 

ARTICLE V  DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC.
	
 

39

	
SECTION 5.1.  Notice of Indenture Default or Triggering Event
	
39

	
SECTION 5.2.  Indemnification
	
41

	
SECTION 5.3.  No Duties Except as Specified in this Intercreditor Agreement
	
41

	
SECTION 5.4.  Notice from the Liquidity Providers and Trustees
	
41

	
 

ARTICLE VI  THE SUBORDINATION AGENT
	
 

41

	
SECTION 6.1.  Authorization; Acceptance of Trusts and Duties
	
41

	
SECTION 6.2.  Absence of Duties
	
42

	
SECTION 6.3.  No Representations or Warranties as to Documents
	
42

	
SECTION 6.4.  No Segregation of Monies; No Interest
	
42

 

  

i

  

Page

	
SECTION 6.5.  Reliance; Agents; Advice of Counsel
	
42

	
SECTION 6.6.  Capacity in Which Acting
	
43

	
SECTION 6.7.  Compensation
	
43

	
SECTION 6.8.  May Become Certificateholder
	
43

	
SECTION 6.9.  Subordination Agent Required; Eligibility
	
43

	
SECTION 6.10.  Money to Be Held in Trust
	
44

	
 

ARTICLE VII  INDEMNIFICATION OF SUBORDINATION AGENT
	
 

44

	
SECTION 7.1.  Scope of Indemnification
	
44

	
 

ARTICLE VIII  SUCCESSOR SUBORDINATION AGENT
	
 

44

	
SECTION 8.1.  Replacement of Subordination Agent; Appointment of Successor
	
44

	
 

ARTICLE IX  SUPPLEMENTS AND AMENDMENTS
	
 

45

	
SECTION 9.1.  Amendments, Waivers, Possible Future Issuance of an Additional Class of Certificates, etc.
	
45

	
SECTION 9.2.  Subordination Agent Protected
	
48

	
SECTION 9.3.  Effect of Supplemental Agreements
	
49

	
SECTION 9.4.  Notice to Rating Agencies
	
49

	
 

ARTICLE X  MISCELLANEOUS
	
 

49

	
SECTION 10.1.  Termination of Intercreditor Agreement
	
49

	
SECTION 10.2.  Intercreditor Agreement for Benefit of Trustees, Liquidity Providers and Subordination Agent
	
49

	
SECTION 10.3.  Notices
	
49

	
SECTION 10.4.  Severability
	
50

	
SECTION 10.5.  No Oral Modifications or Continuing Waivers
	
51

	
SECTION 10.6.  Successors and Assigns
	
51

	
SECTION 10.7.  Headings
	
51

	
SECTION 10.8.  Counterpart Form
	
51

	
SECTION 10.9.  Subordination
	
51

	
SECTION 10.10.  Governing Law
	
53

	
SECTION 10.11.  Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity.
	
53

 

 

ii

BACK 

INTERCREDITOR AGREEMENT

 

INTERCREDITOR AGREEMENT (this “Agreement”) dated as of November 10, 2009, among WILMINGTON TRUST COMPANY, a Delaware banking corporation (“WTC”), not in its individual capacity but solely
as Trustee of each Trust (each as defined below); NATIXIS S.A., a French société anonyme, acting through its New York Branch, as Class A Liquidity Provider and Class B Liquidity Provider; and WILMINGTON TRUST COMPANY, not in its individual capacity except as expressly set forth herein, but solely as Subordination Agent and trustee hereunder (in such capacity, together with any successor appointed pursuant to Article VIII hereof, the “Subordination
Agent”).

 

WHEREAS, all capitalized terms used herein shall have the respective meanings referred to in Article I hereof;

 

WHEREAS, pursuant to each Indenture, Continental will issue on a recourse basis up to (and including) two series of Equipment Notes to finance or refinance, as the case may be, the related Aircraft;

 

WHEREAS, pursuant to the Financing Agreements, each Trust will acquire Equipment Notes having an interest rate equal to the Stated Interest Rate applicable to the Certificates to be issued by such Trust;

 

WHEREAS, pursuant to the each Trust Agreement, the Trust created thereby proposes to issue a single class of Certificates (a “Class”) having the interest rate and the final distribution date described in such Trust Agreement on the terms and subject to the conditions
set forth therein;

 

WHEREAS, pursuant to the Underwriting Agreement, the Underwriters propose to purchase the Class A Certificates issued by the Class A Trust and the Class B Certificates issued by the Class B Trust in the aggregate face amount set forth opposite the name of such Trust on Schedule I thereto on the terms and subject to the conditions set forth
therein;

 

WHEREAS, the Class A Liquidity Provider proposes to enter into a revolving credit agreement relating to the Class A Certificates and the Class B Liquidity Provider proposes to enter into a revolving credit agreement relating to the Class B Certificates, in each case with the Subordination Agent, as agent for the Trustee of the applicable
Trust, respectively, for the benefit of the Certificateholders of such Trust; and

 

WHEREAS, it is a condition precedent to the obligations of the Underwriters under the Underwriting Agreement that the Subordination Agent, the Trustees and the Liquidity Providers agree to the terms of subordination set forth in this Agreement in respect of each Class of Certificates, and the Subordination Agent, the Trustees and the Liquidity
Providers, by entering into this Agreement, hereby acknowledge and agree to such terms of subordination and the other provisions of this Agreement.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

 

  

BACK 

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.1.  Definitions.  For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires:

 

(1)           the terms used herein that are defined in this Article have the meanings assigned to them in this Article, and include the plural as well as the singular;

 

(2)           all references in this Agreement to designated “Articles”, “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Agreement;

 

(3)           the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision; and

 

(4)           the term “including” means “including without limitation”.

 

“Acceleration” means, with respect to the amounts payable in respect of the Equipment Notes issued under any Indenture, such amounts becoming immediately due and payable by declaration or otherwise.  “Accelerate”,
“Accelerated” and “Accelerating” have meanings correlative to the foregoing.

 

“Actual Disposition Event” means, in respect of any Equipment Note: (i) the disposition of the Aircraft securing such Equipment Note, (ii) the occurrence of the mandatory redemption date for such
Equipment Note following an Event of Loss (as defined in such Indenture) with respect to the Aircraft which secured such Equipment Note or (iii) the sale of such Equipment Note.

 

“Additional Certificateholders” has the meaning specified in Section 9.1(d).

 

“Additional Certificates” has the meaning specified in Section 9.1(d).

 

“Additional Equipment Notes” has the meaning specified in Section 9.1(d).

 

“Additional Trust” has the meaning specified in Section 9.1(d).

 

“Additional Trust Agreement” has the meaning specified in Section 9.1(d).

 

“Additional Trustee” has the meaning specified in Section 9.1(d).

 

“Administration Expenses” has the meaning specified in clause “first” of Section 3.2.

 

“Advance”, with respect to any Liquidity Facility, means any Advance as defined in such Liquidity Facility.

 

 

2

BACK 

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person.  For the purposes of this definition, “control” means the power, directly or indirectly,
to direct or cause the direction of the management and policies of such Person whether through the ownership of voting securities or by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

“Aircraft” means, with respect to each Indenture, the “Aircraft” referred to therein.

 

“Appraisal” has the meaning specified in Section 4.1(a)(iv).

 

“Appraised Current Market Value” of any Aircraft means the lower of the average and the median of the three most recent Post-Default Appraisals of such Aircraft.

 

“Appraisers” means Aircraft Information Services, Inc., BK Associates, Inc. and Morten Beyer and Agnew, Inc. or, so long as the Person entitled or required hereunder to select such Appraiser acts reasonably, any other nationally recognized appraiser reasonably satisfactory
to the Subordination Agent and the Controlling Party.

 

“Assignment and Assumption Agreements” means each of the Assignment and Assumption Agreements to be executed between a Trustee and trustee of the relevant Successor Trust in accordance with the relevant Trust Agreement, as the same may be amended, modified or supplemented
from time to time.

 

“Available Amount” means, with respect to any Liquidity Facility on any date, the Maximum Available Commitment (as defined therein) on such date.

 

“Bankruptcy Code” means the United States Bankruptcy Code, 11 U.S.C. Sections 101 et seq.

 

“Basic Agreement” means the Pass Through Trust Agreement dated as of September 25, 1997 between Continental and WTC, not in its individual capacity, except as otherwise expressly provided therein, but solely as trustee.

 

“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 Certificate is outstanding, the city and state in which any Trustee, the
Subordination Agent or any Loan Trustee maintains its Corporate Trust Office and that, solely with respect to the making and repayment of Advances under any Liquidity Facility, also is a “Business Day” as defined in such Liquidity Facility.

 

“Cash Collateral Account” means the Class A Cash Collateral Account or the Class B Cash Collateral Account, as applicable.

 

“Certificate” means a Class A Certificate or a Class B Certificate, as applicable.

 

“Certificateholder” means any holder of one or more Certificates.

 

 

3

BACK 

“Class” has the meaning assigned to such term in the preliminary statements to this Agreement.

 

“Class A Cash Collateral Account” means an Eligible Deposit Account in the name of the Subordination Agent maintained at an Eligible Institution, which shall be the Subordination Agent if it shall so qualify, into which all amounts drawn under the Class A Liquidity
Facility pursuant to Section 3.5(c), 3.5(d), 3.5(i) or 3.5(m) shall be deposited.

 

“Class A Certificateholder” means, at any time, any holder of one or more Class A Certificates.

 

“Class A Certificates” means the certificates issued by the Class A Trust, substantially in the form of Exhibit A to the Class A Trust Agreement, and authenticated by the Class A Trustee, representing fractional undivided interests in the Class A Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of the Class A Trust Agreement.

 

“Class A Liquidity Facility” means, initially, the Revolving Credit Agreement dated as of the date hereof, between the Subordination Agent, as agent and trustee for the Class A Trust, and the initial Class A Liquidity Provider, and from and after the replacement
of such Revolving Credit Agreement pursuant hereto, the Replacement Liquidity Facility therefor, if any, in each case as amended, supplemented or otherwise modified from time to time in accordance with its terms.

 

“Class A Liquidity Provider” means Natixis S.A, acting through its New York Branch, or, if applicable, any Replacement Liquidity Provider which has issued a Replacement Liquidity Facility to replace any Class A Liquidity Facility pursuant to Section 3.5(e).

 

“Class A Trust” means (i) prior to the Transfer, the Continental Airlines Pass Through Trust 2009-2A-O created and administered pursuant to the Class A Trust Agreement and (ii) after the Transfer, the Continental Airlines Pass Through Trust 2009-2A-S created and
administered pursuant to the Class A Trust Agreement.

 

“Class A Trust Agreement” means (i) prior to the Transfer, the Basic Agreement, as supplemented by the Supplement No. 2009-2A-O thereto dated as of the date hereof, governing the creation and administration of the Continental Airlines Pass Through Trust 2009-2A-O
(the “Original Class A Trust”) and the issuance of the Class A Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, and (ii) after the Transfer, the Basic Agreement, as supplemented by the Supplement No. 2009-2A-S thereto, governing the creation and administration of the Continental Airlines Pass Through Trust 2009-2A-S (the “Successor
Class A Trust”) and the issuance of the Class A Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms.

 

“Class A Trustee” means WTC, not in its individual capacity except as expressly set forth in the Class A Trust Agreement, but solely as trustee under the Class A Trust Agreement, together with any successor trustee appointed pursuant thereto.

 

 

4

BACK 

“Class B Adjusted Interest” means, as of any Current Distribution Date: (I) any interest described in clause (II) of this definition accruing prior to the immediately preceding Distribution Date
which remains unpaid and (II) interest at the Stated Interest Rate for the Class B Certificates (A) for the number of days during the period commencing on, and including, the immediately preceding Distribution Date (or, if the Current Distribution Date is the first Distribution Date, the Closing Date) and ending on, but excluding the Current Distribution Date, on the Preferred B Pool Balance on such Current Distribution Date and (B) on the principal amount calculated pursuant to clauses (B)(i),
(ii), (iii) and (iv) of the definition of Preferred B Pool Balance for each Series B Equipment Note with respect to which a disposition, distribution, sale or Deemed Disposition Event has occurred since the immediately preceding Distribution Date (but only if no such event has previously occurred with respect to such Series B Equipment Note), for each day during the period, for each such Series B Equipment Note, commencing on, and including, the immediately preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, the Closing Date) and ending on, but excluding the date of disposition, distribution, sale or Deemed Disposition Event with respect to such Series B Equipment Note, Aircraft or Collateral, as the case may be.

 

“Class B Cash Collateral Account” means an Eligible Deposit Account in the name of the Subordination Agent maintained at an Eligible Institution, which shall be the Subordination Agent if it shall so qualify, into which all amounts drawn under the Class B Liquidity
Facility pursuant to Section 3.5(c), 3.5(d), 3.5(i) or 3.5(m) shall be deposited.

 

“Class B Certificateholder” means, at any time, any holder of one or more Class B Certificates.

 

“Class B Certificates” means the certificates issued by the Class B Trust, substantially in the form of Exhibit A to the Class B Trust Agreement, and authenticated by the Class B Trustee, representing fractional undivided interests in the Class B Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of the Class B Trust Agreement.

 

“Class B Liquidity Facility” means, initially, the Revolving Credit Agreement dated as of the date hereof, between the Subordination Agent, as agent and trustee for the Class B Trust, and the initial Class B Liquidity Provider, and from and after the replacement
of such Revolving Credit Agreement pursuant hereto, the Replacement Liquidity Facility therefor, if any, in each case as amended, supplemented or otherwise modified from time to time in accordance with its terms.

 

“Class B Liquidity Provider” means Natixis S.A, acting through its New York Branch, or, if applicable, any Replacement Liquidity Provider which has issued a Replacement Liquidity Facility to replace any Class B Liquidity Facility pursuant to Section 3.5(e).

 

“Class B Trust” means (i) prior to the Transfer, the Continental Airlines Pass Through Trust 2009-2B-O created and administered pursuant to the Class B Trust Agreement and (ii) after the Transfer, the Continental Airlines Pass Through Trust 2009-2B-S created and
administered pursuant to the Class B Trust Agreement.

 

 

5

BACK 

“Class B Trust Agreement” means (i) prior to the Transfer, the Basic Agreement, as supplemented by the Supplement No. 2009-2B-O thereto dated as of the date hereof, governing the creation and administration of the Continental Airlines Pass Through Trust 2009-2B-O
(the “Original Class B Trust”) and the issuance of the Class B Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, and (ii) after the Transfer, the Basic Agreement, as supplemented by the Supplement No. 2009-2B-S thereto, governing the creation and administration of the Continental Airlines Pass Through Trust 2009-2B-S (the “Successor
Class B Trust”) and the issuance of the Class B Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms.

 

“Class B Trustee” means WTC, not in its individual capacity except as expressly set forth in the Class B Trust Agreement, but solely as trustee under the Class B Trust Agreement, together with any successor trustee appointed pursuant thereto.

 

“Closing Date” means November 10, 2009.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the Treasury Regulations promulgated thereunder.

 

“Collateral” has the meaning specified in the Indentures.

 

“Collection Account” means the Eligible Deposit Account established by the Subordination Agent pursuant to Section 2.2(a)(i) which the Subordination Agent shall make deposits in and withdrawals from in accordance with this Agreement.

 

“Consent Period” has the meaning specified in Section 3.5(d).

 

“Continental” means Continental Airlines, Inc., a Delaware corporation, and its successors and assigns.

 

“Continental Bankruptcy Event” means the occurrence and continuation of any of the following:

 

(a)           Continental shall consent to the appointment of or the taking of possession by a receiver, trustee or liquidator of itself or of a substantial part of its property, or Continental shall admit in writing its inability to pay its debts generally as they come due, or does
not pay its debts generally as they become due or shall make a general assignment for the benefit of creditors, or Continental shall file a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief in a case under any bankruptcy laws or other insolvency laws (as in effect at such time) or an answer admitting the material allegations of a petition filed against Continental in any such case, or Continental shall seek relief by voluntary petition, answer
or consent, under the provisions of any other bankruptcy or other similar law providing for the reorganization or winding-up of corporations (as in effect at such time) or Continental shall seek an agreement, composition, extension or adjustment with its creditors under such laws, or Continental’s board of directors shall adopt a resolution authorizing corporate action in furtherance of any of the foregoing; or

 

 

6

BACK 

(b)           an order, judgment or decree shall be entered by any court of competent jurisdiction appointing, without the consent of Continental, a receiver, trustee or liquidator of Continental or of any substantial part of its property, or any substantial part of the property of Continental
shall be sequestered, or granting any other relief in respect of Continental as a debtor under any bankruptcy laws or other insolvency laws (as in effect at such time), and any such order, judgment or decree of appointment or sequestration shall remain in force undismissed, unstayed and unvacated for a period of 60 days after the date of entry thereof; or

 

(c)           a petition against Continental in a case under any bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within 60 days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of
corporations which may apply to Continental, any court of competent jurisdiction assumes jurisdiction, custody or control of Continental or of any substantial part of its property and such jurisdiction, custody or control remains in force unrelinquished, unstayed and unterminated for a period of 60 days.

 

“Continental Provisions” has the meaning specified in Section 9.1(a).

 

“Controlling Party” means the Person entitled to act as such pursuant to the terms of Section 2.6.

 

“Corporate Trust Office” means, with respect to any Trustee, the Subordination Agent or any Loan Trustee, the office of such Person in the city at which, at any particular time, its corporate trust business shall be principally administered.

 

“Current Distribution Date” means a Distribution Date specified as a reference date for calculating the Expected Distributions with respect to the Certificates of any Trust as of such Distribution Date.

 

“Deemed Disposition Event” means, in respect of any Equipment Note, the continuation of an Indenture Default in respect of such Equipment Note without an Actual Disposition Event occurring in respect of
such Equipment Note for a period of five years from the date of the occurrence of such Indenture Default.

 

“Delivery Period Expiry Date” means the earlier of (a) August 31, 2010, and (b) the date on which the Equipment Notes with respect to all Aircraft (as defined in the Note Purchase Agreement) (including any Substitute Aircraft in lieu of the New Aircraft (as defined
in the Note Purchase Agreement)) have been purchased by the Trusts in accordance with the Note Purchase Agreement.

 

“Deposit Agreement” means, with respect to any Class of Certificates, the Deposit Agreement pertaining to such Class, dated as of the date hereof, between the Escrow Agent and the Depositary, as the same may be amended, modified or supplemented from time to time
in accordance with the terms thereof.

 

“Depositary” means The Bank of New York Mellon, as depositary under each Deposit Agreement.

 

 

7

BACK 

“Deposits”, with respect to any Class of Certificates, has the meaning set forth in the Deposit Agreement pertaining to such Class.

 

“Designated Representatives” means the Subordination Agent Representatives, the Trustee Representatives and the Provider Representatives identified under Section 2.5.

 

“Distribution Date” means a Regular Distribution Date or a Special Distribution Date.

 

“Dollars” or “$” means United States dollars.

 

“Downgrade Drawing” has the meaning specified in Section 3.5(c).

 

“Downgrade Event” means, with respect to any Liquidity Facility, the short-term unsecured debt rating or short-term issuer credit rating, as the case may be, of the Liquidity Provider thereunder then issued by either Rating Agency being lower than the applicable
Threshold Rating, unless each Rating Agency shall have confirmed in writing on or prior to the date of any downgrading of the Liquidity Provider thereunder that such downgrading will not result in the downgrading, withdrawal or suspension of the ratings of the related Class of Certificates, in which case such downgrading of such short-term unsecured debt rating or short-term issuer credit rating, as the case may be, shall not constitute a Downgrade Event.

 

“Downgraded Facility” has the meaning specified in Section 3.5(c).

 

“Drawing” means an Interest Drawing, a Final Drawing, a Special Termination Drawing, a Non-Extension Drawing or a Downgrade Drawing, as the case may be.

 

“Eligible Deposit Account” means either (a) a segregated account with an Eligible Institution or (b) a segregated trust account with the corporate trust department of a depository institution organized under the laws of the United States of America or any one of
the states thereof or the District of Columbia (or any U.S. branch of a foreign bank), having corporate trust powers and acting as trustee for funds deposited in such account, so long as any of the securities of such depository institution has a long-term unsecured debt rating of at least A3 from Moody’s and a long-term issuer credit rating of at least A- from Standard & Poor’s.  An Eligible Deposit Account may be maintained with a Liquidity Provider so long as such Liquidity Provider
is an Eligible Institution; provided that such Liquidity Provider shall have waived all rights of set-off and counterclaim with respect to such account.

 

“Eligible Institution” means (a) the corporate trust department of the Subordination Agent or any Trustee, as applicable, or (b) a depository institution organized under the laws of the United States of America or any one of the states thereof or the District of
Columbia (or any U.S. branch of a foreign bank), which has a long-term unsecured debt rating or issuer credit rating, as the case may be, from each Rating Agency of at least A-3 or its equivalent.

 

“Eligible Investments” means (a) investments in obligations of, or guaranteed by, the United States government having maturities no later than 90 days following the date of such investment, (b) investments in open market commercial paper of any corporation incorporated

 

 

8

BACK 

under the laws of the United States of America or any state thereof with a short-term unsecured debt rating issued by Moody’s of at least P-1 and a short-term issuer credit rating issued by Standard & Poor’s of at least A-1 having maturities no later than 90 days following the date of such investment or (c) investments in negotiable
certificates of deposit, time deposits, banker’s acceptances, commercial paper or other direct obligations of, or obligations guaranteed by, commercial banks organized under the laws of the United States or of any political subdivision thereof (or any U.S. branch of a foreign bank) with a short-term unsecured debt rating by Moody’s of at least P-1 and a short-term issuer credit rating by Standard & Poor’s of at least A-1, having maturities no later than 90 days following the date of such
investment; provided, however, that (x) all Eligible Investments that are bank obligations shall be denominated in Dollars; and (y) the aggregate amount of Eligible Investments at any one time that are bank obligations issued by any one bank shall not be in excess of 5% of such bank’s capital surplus; provided further that
any investment of the types described in clauses (a), (b) and (c) above may be made through a repurchase agreement in commercially reasonable form with a bank or other financial institution qualifying as an Eligible Institution so long as such investment is held by a third party custodian also qualifying as an Eligible Institution; provided further, however,
that in the case of any Eligible Investment issued by a domestic branch of a foreign bank, the income from such investment shall be from sources within the United States for purposes of the Code.  Notwithstanding the foregoing, no investment of the types described in clause (b) above which is issued or guaranteed by Continental or any of its Affiliates, and no investment in the obligations of any one bank in excess of $10,000,000, shall be an Eligible Investment unless a Ratings Confirmation shall have
been received with respect to the making of such investment.

 

“Equipment Note Special Payment” means a Special Payment on account of the redemption, purchase or prepayment of all of the Equipment Notes issued pursuant to an Indenture.

 

“Equipment Notes” means, at any time, the Series A Equipment Notes and the Series B Equipment Notes, collectively, and in each case, any Equipment Notes issued in exchange therefor or replacement thereof pursuant to the terms of the Indentures.

 

“Escrow Agent” means Wells Fargo Bank Northwest, National Association, as escrow agent under each Escrow and Paying Agent Agreement, together with its successors in such capacity.

 

“Escrow and Paying Agent Agreement” means, with respect to either Class of Certificates, the Escrow and Paying Agent Agreement pertaining to such Class dated as of the date hereof between the Escrow Agent, the Underwriters, the Trustee for such Class and the Paying
Agent, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof.

 

“Expected Distributions” means, with respect to the Certificates of any Trust on any Current Distribution Date, the difference between (A) the Pool Balance of such Certificates as of the immediately preceding Distribution Date (or, if the Current Distribution Date
is the first Distribution Date, the original aggregate face amount of the Certificates of such Trust) and (B) the Pool Balance of such Certificates as of the Current Distribution Date calculated on the basis that (i) the principal of the Non-Performing Equipment Notes held in such Trust has been

 

 

9

BACK 

paid in full and such payments have been distributed to the holders of such Certificates, (ii) the principal of the Performing Equipment Notes held in such Trust has been paid when due (without giving effect to any Acceleration of Performing Equipment Notes) and such payments have been distributed to the holders of such Certificates and (iii)
the principal of any Equipment Notes formerly held in such Trust that have been sold pursuant to the terms hereof has been paid in full and such payments have been distributed to the holders of such Certificates, but without giving effect to any reduction in the Pool Balance as a result of any distribution attributable to Deposits occurring after the immediately preceding Distribution Date (or, if the Current Distribution Date is the first Distribution Date, occurring after the initial issuance of the Certificates
of such Trust).  For purposes of calculating Expected Distributions with respect to the Certificates of any Trust, any Premium paid on the Equipment Notes held in such Trust which has not been distributed to the Certificateholders of such Trust (other than such Premium or a portion thereof applied to the payment of interest on the Certificates of such Trust or the reduction of the Pool Balance of such Trust) shall be added to the amount of such Expected Distributions.

 

“Expiry Date”, with respect to any Liquidity Facility, has the meaning set forth in such Liquidity Facility.

 

“Facility Office” means, with respect to any Liquidity Facility, the office of the Liquidity Provider thereunder, presently located at New York, New York, or such other office as such Liquidity Provider from time to time shall notify the applicable Trustee as its
“Facility Office” under any such Liquidity Facility; provided that such 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 of any such Liquidity Facility.

 

“Fee Letters” means, collectively, (i) the Fee Letter dated as of the date hereof among Natixis S.A, acting through its New York Branch, the Subordination Agent and Continental with respect to the initial Liquidity Facilities and (ii) any fee letter entered into
among the Subordination Agent, any Replacement Liquidity Provider and Continental in respect of either or both of such Liquidity Facilities.

 

“Final Distributions” means, with respect to the Certificates of any Trust on any Distribution Date, the sum of (x) the aggregate amount of all accrued and unpaid interest on such Certificates (excluding interest, if any, payable with respect to the Deposits relating
to such Trust) and (y) the Pool Balance of such Certificates as of the immediately preceding Distribution Date (less the amount of the Deposits for such Class of Certificates as of such preceding Distribution Date other than any portion of such Deposits thereafter used to acquire Equipment Notes pursuant to the Note Purchase Agreement).  For purposes of calculating Final Distributions with respect to the Certificates of any Trust, any Premium paid on the Equipment Notes held in such Trust which has
not been distributed to the Certificateholders of such Trust (other than such Premium or a portion thereof applied to the payment of interest on the Certificates of such Trust or the reduction of the Pool Balance of such Trust) shall be added to the amount of such Final Distributions.

 

“Final Drawing” has the meaning specified in Section 3.5(i).

 

 

10

BACK 

“Final Legal Distribution Date” means (i) with respect to the Class A Certificates, May 10, 2021, and (ii) with respect to the Class B Certificates, November 10, 2018.

 

“Financing Agreement” means each of the Participation Agreements, the Indentures and the Note Purchase Agreement.

 

“Indenture” means each of the Trust Indentures entered into by the Loan Trustee and Continental, pursuant to the Note Purchase Agreement, in each case as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms.

 

“Indenture Default” means, with respect to any Indenture, any Event of Default (as such term is defined in such Indenture) thereunder.

 

“Interest Drawing” has the meaning specified in Section 3.5(a).

 

“Interest Payment Date” means, with respect to any Liquidity Facility, each date on which interest is due and payable under such Liquidity Facility on a Downgrade Drawing, Non-Extension Drawing, a Special Termination Drawing or Final Drawing thereunder, other than
any such date on which interest is due and payable under such Liquidity Facility only on an Applied Provider Advance or Applied Special Termination Advance (as such terms are defined in such Liquidity Facility).

 

“Interest Period” has the meaning specified in the Indentures.

 

“Investment Earnings” means investment earnings on funds on deposit in the Trust Accounts net of losses and investment expenses of the Subordination Agent in making such investments.

 

“Lien” means any mortgage, pledge, lien, charge, claim, disposition of title, encumbrance, lease, sublease, sub-sublease or security interest of any kind, including, without limitation, any thereof arising under any conditional sales or other title retention agreement.

 

“Liquidity Event of Default”, with respect to any Liquidity Facility, has the meaning assigned to such term in such Liquidity Facility.

 

“Liquidity Expenses” means all Liquidity Obligations other than (i) the principal amount of any Drawings under the Liquidity Facilities and (ii) any interest accrued on any Liquidity Obligations.

 

“Liquidity Facility” means, at any time, the Class A Liquidity Facility or the Class B Liquidity Facility, as applicable.

 

“Liquidity Obligations” means all principal, interest, fees and other amounts owing to the Liquidity Providers under the Liquidity Facilities, Section 8.1 of the Participation Agreements or the Fee Letters.

 

“Liquidity Provider” means, at any time, the Class A Liquidity Provider or the Class B Liquidity Provider, as applicable.

 

 

11

BACK 

“Loan Trustee” means, with respect to any Indenture, the mortgagee thereunder.

 

“Minimum Sale Price” means, with respect to any Aircraft or the Equipment Notes issued in respect of such Aircraft, at any time, in the case of the sale of an Aircraft, 75%, or in the case of the sale of related Equipment Notes, 85%, of the Appraised
Current Market Value of such Aircraft.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Non-Controlling Party” means, at any time, any Trustee, Liquidity Provider or other Person which is not the Controlling Party at such time.

 

“Non-Extended Facility” has the meaning specified in Section 3.5(d).

 

“Non-Extension Drawing” has the meaning specified in Section 3.5(d).

 

“Non-Performing Equipment Note” means an Equipment Note issued pursuant to an Indenture that is not a Performing Equipment Note.

 

“Note Purchase Agreement” means the Note Purchase Agreement, dated as of the date hereof, among Continental, each Trustee, the Escrow Agent, the Subordination Agent and the Paying Agent, as amended, supplemented or otherwise modified from time to time in accordance
with its terms.

 

“Operative Agreements” means this Agreement, the Liquidity Facilities, the Trust Agreements, the Underwriting Agreement, the Financing Agreements, the Fee Letters, the Equipment Notes and the Certificates, together with all exhibits and schedules included with any
of the foregoing.

 

“Original Class A Trust” has the meaning assigned to such term in the definition of “Class A Trust Agreement”.

 

“Original Class B Trust” has the meaning assigned to such term in the definition of “Class B Trust Agreement”.

 

“Outstanding” means, when used with respect to each Class of Certificates, as of the date of determination, all Certificates of such Class theretofore authenticated and delivered under the related Trust Agreement, except:

 

(i)           Certificates of such Class theretofore canceled by the Registrar (as defined in such Trust Agreement) or delivered to the Trustee thereunder or such Registrar for cancellation;

 

(ii)           Certificates of such Class for which money in the full amount required to make the Final Distribution with respect to such Certificates pursuant to Section 11.01 of such Trust Agreement has been theretofore deposited with the related Trustee in trust for the holders of
such Certificates as provided in Section 4.01 of such Trust Agreement

 

 

12

BACK 

pending distribution of such money to such Certificateholders pursuant to such Final Distribution payment; and

 

(iii)           Certificates of such Class in exchange for or in lieu of which other Certificates have been authenticated and delivered pursuant to such Trust Agreement;

 

provided, however, that in determining whether the holders of the requisite Outstanding amount of such Certificates have given any request, demand, authorization, direction, notice, consent or waiver hereunder,
any Certificates owned by Continental or any of its Affiliates shall be disregarded and deemed not to be Outstanding, except that, in determining whether such Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Certificates that such Trustee knows to be so owned shall be so disregarded.  Certificates so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the applicable Trustee the pledgee’s right so to act with respect to such Certificates and that the pledgee is not Continental or any of its Affiliates.

 

“Overdue Scheduled Payment” means any Scheduled Payment which is not in fact received by the Subordination Agent within five days after the Scheduled Payment Date relating thereto.

 

“Participation Agreement” means, with respect to each Indenture, the “Participation Agreement” referred to therein.

 

“Payee” has the meaning specified in Section 2.4(c).

 

“Paying Agent” means Wilmington Trust Company, as paying agent under each Escrow and Paying Agent Agreement, together with its successors in such capacity.

 

“Paying Agent Account” has the meaning assigned to such term in the Escrow and Paying Agent Agreements.

 

“Performing Equipment Note” means an Equipment Note with respect to which no payment default has occurred and is continuing (without giving effect to any Acceleration); provided that in the event of
a bankruptcy proceeding under the Bankruptcy Code in which Continental is a debtor any payment default existing during the 60-Day Period (or such longer period as may apply under Section 1110(b) of the Bankruptcy Code or as may apply for the cure of such payment default under Section 1110(a)(2)(B) of the Bankruptcy Code) shall not be taken into consideration until the expiration of the applicable period.

 

“Performing Note Deficiency” means any time that less than 65% of the then aggregate outstanding principal amount of all Equipment Notes (other than any Additional Equipment Notes issued under any Indenture) are Performing Equipment Notes.

 

“Person” means any individual, corporation, partnership, joint venture, association, limited liability company, joint-stock company, trust, trustee, unincorporated organization or government or any agency or political subdivision thereof.

 

 

13

BACK 

“Pool Balance” means, with respect to each Trust or the Certificates issued by any Trust, as of any date, (i) the original aggregate face amount of the Certificates of such Trust less (ii) the
aggregate amount of all payments made as of such date in respect of the Certificates of such Trust or in respect of Deposits relating to such Trust other than payments made in respect of interest or Premium thereon or reimbursement of any costs and expenses in connection therewith.  The Pool Balance for each Trust or for the Certificates issued by any Trust as of any date shall be computed after giving effect to any special distribution with respect to unused Deposits, if any, payment of principal of
the Equipment Notes or payment with respect to other Trust Property held in such Trust and the distribution thereof to be made on that date.

 

“Post-Default Appraisals” has the meaning specified in Section 4.1(a)(iv).

 

“Preferred B Pool Balance” means, as of any date, the excess of (A) the Pool Balance of the Class B Certificates as of the immediately preceding Distribution Date (or, if such date is on or before
the first Distribution Date, the original aggregate face amount of the Class B Certificates) (after giving effect to distributions made on such date) over (B) the sum of (i) the outstanding principal amount of each Series B Equipment Note that remains unpaid as of such date subsequent to the disposition of the Collateral under the Indenture pursuant to which such Series B Equipment Note was issued and after giving effect to any distributions of the proceeds of such disposition applied under such Indenture
to the payment of each such Series B Equipment Note, (ii) the outstanding principal amount of each Series B Equipment Note that remains unpaid as of such date subsequent to the scheduled date of mandatory redemption of such Series B Equipment Note following an Event of Loss (as defined in such Indenture) with respect to the Aircraft which secured such Series B Equipment Note and after giving effect to the distributions of any proceeds in respect of such Event of Loss applied under such Indenture to the payment
of each such Series B Equipment Note, (iii) the excess, if any, of (x) the outstanding amount of principal and interest as of the date of sale of each Series B Equipment Note previously sold over (y) the purchase price received with respect to the sale of such Series B Equipment Note (net of any applicable costs and expenses of sale) and (iv) the outstanding principal amount of any Series B Equipment Note with respect to which a Deemed Disposition Event has occurred; provided, however,
that if more than one of the clauses (i), (ii), (iii) and (iv) is applicable to any one Series B Equipment Note, only the amount determined pursuant to the clause that first became applicable shall be counted with respect to such Series B Equipment Note.

 

“Premium” means any “Make-Whole Amount” as such term is defined in any Indenture.

 

“Proceeding” means any suit in equity, action at law or other judicial or administrative proceeding.

 

“Provider Incumbency Certificate” has the meaning specified in Section 2.5(c).

 

“Provider Representatives” has the meaning specified in Section 2.5(c).

 

“PTC Event of Default” means, with respect to each Trust Agreement, the failure to pay within 10 Business Days of the due date thereof:  (i) the outstanding Pool Balance of the

 

 

14

BACK 

applicable Class of Certificates on the Final Legal Distribution Date for such Class or (ii) interest due on such Certificates on any Distribution Date (unless the Subordination Agent shall have made an Interest Drawing or a withdrawal from the Cash Collateral Account relating to a Liquidity Facility for such Class, with respect thereto
in an aggregate amount sufficient to pay such interest and shall have distributed such amount to the Trustee entitled thereto).

 

“Rating Agencies” means, collectively, at any time, each nationally recognized rating agency which shall have been requested to rate the Certificates and which shall then be rating the Certificates.  The initial Rating Agencies will be Moody’s and
Standard & Poor’s.

 

“Ratings Confirmation” means, with respect to any action proposed to be taken, a written confirmation from each of the Rating Agencies that such action would not result in (i) a reduction of the rating for any Class of Certificates below the then current rating for
such Class of Certificates or (ii) a withdrawal or suspension of the rating of any Class of Certificates.

 

“Refinancing Certificateholders” has the meaning specified in Section 9.1(c).

 

“Refinancing Certificates” has the meaning specified in Section 9.1(c).

 

“Refinancing Equipment Notes” has the meaning specified in Section 9.1(c).

 

“Refinancing Trust Agreement” has the meaning specified in Section 9.1(c).

 

“Refinancing Trust” has the meaning specified in Section 9.1(c).

 

“Refinancing Trustee” has the meaning specified in Section 9.1(c).

 

“Regular Distribution Dates” means each May 10 and November 10, commencing on May 10, 2010; provided, however, that, if any such day
shall not be a Business Day, the related distribution shall be made on the next succeeding Business Day without distribution of interest for such additional period.

 

“Replacement Liquidity Facility” means, for any Liquidity Facility, an irrevocable revolving credit agreement (or agreements) in substantially the form of the replaced Liquidity Facility, including reinstatement provisions, or in such other form (which may include
a letter of credit) as shall permit the Rating Agencies to confirm in writing their respective ratings then in effect for the related Certificates (before downgrading of such ratings, if any, as a result of the downgrading of the applicable Liquidity Provider), in a face amount (or in an aggregate face amount) equal to the then Required Amount and issued by a Person (or Persons) having unsecured short-term debt rating or issuer credit rating, as the case may be, issued by both Rating Agencies which are equal
to or higher than the Threshold Rating.  Without limitation of the form that a Replacement Liquidity Facility otherwise may have pursuant to the preceding sentence, a Replacement Liquidity Facility for any Class of Certificates may have a stated expiration date earlier than 15 days after the Final Legal Distribution Date of such Class of Certificates so long as such Replacement Liquidity Facility provides for a Non-Extension Drawing as contemplated by Section 3.5(d) hereof.

 

 

15

BACK 

“Replacement Liquidity Provider” means a Person (or Persons) who issues a Replacement Liquidity Facility.

 

“Required Amount” means with respect to each Liquidity Facility or Cash Collateral Account, 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 related Class of Certificates, that would
be payable on such Class of Certificates on each of the three successive Regular Distribution Dates immediately following such day or, if such day is a Regular Distribution Date, on such day and the succeeding two Regular Distribution Dates, in each case calculated on the basis of the Pool Balance of such Class of Certificates on such day and without regard to expected future distributions of principal on such Class of Certificates.

 

“Responsible Officer” means (i) with respect to the Subordination Agent and each of the Trustees, any officer in the corporate trust administration department of the Subordination Agent or such Trustee or any other officer customarily performing functions similar
to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of his knowledge of and familiarity with a particular subject and (ii) with respect to each Liquidity Provider, any authorized officer of such Liquidity Provider.

 

“Scheduled Payment” means, with respect to any Equipment Note, (i) any payment of principal or interest on such Equipment Note (other than an Overdue Scheduled Payment) due from the obligor thereon, which payment represents the installment of principal at the
stated maturity of such installment of principal on such Equipment Note, the payment of regularly scheduled interest accrued on the unpaid principal amount of such Equipment Note, or both or (ii) any payment of interest on the corresponding Class of Certificates with funds drawn under any Liquidity Facility or withdrawn from any Cash Collateral Account, which payment represents the payment of regularly scheduled interest accrued on the unpaid principal amount of the related Equipment Note; provided that
any payment of principal of, Premium, if any, or interest resulting from the redemption or purchase of any Equipment Note shall not constitute a Scheduled Payment.

 

“Scheduled Payment Date” means, with respect to any Scheduled Payment, the date on which such Scheduled Payment is scheduled to be made.

 

“Section 2.4 Fraction” means, with respect to any Special Distribution Date, a fraction, the numerator of which shall be the amount of principal of the applicable Series A Equipment Notes and Series B Equipment Notes being redeemed, purchased or prepaid on such Special
Distribution Date, and the denominator of which shall be the aggregate unpaid principal amount of all Series A Equipment Notes and Series B Equipment Notes outstanding as of such Special Distribution Date.

 

“Series A Equipment Notes” means the Series A Equipment Notes issued pursuant to any Indenture by Continental and authenticated by the Loan Trustee thereunder, and any such Equipment Notes issued in exchange therefor or replacement thereof pursuant to the terms of
such Indenture.

 

 

16

BACK 

“Series B Equipment Notes” means the Series B Equipment Notes issued pursuant to any Indenture by Continental and authenticated by the Loan Trustee thereunder, and any such Equipment Notes issued in exchange therefor or replacement thereof pursuant to the terms of
such Indenture.

 

“60-Day Period” means 60-day period specified in Section 1110(a)(2)(A) of the Bankruptcy Code.

 

“Special Distribution Date” means, with respect to any Special Payment, the date chosen by the Subordination Agent pursuant to Section 2.4(a) for the distribution of such Special Payment in accordance with this Agreement, whether distributed pursuant to Section 2.4
or Section 3.2 hereof.

 

“Special Payment” means any payment (other than a Scheduled Payment) in respect of, or any proceeds of, any Equipment Note or Collateral.

 

“Special Payments Account” means the Eligible Deposit Account created pursuant to Section 2.2(a)(ii) as a sub-account to the Collection Account.

 

“Special Termination Drawing” has the meaning specified in Section 3.5(m).

 

“Special Termination Notice”, with respect to any Liquidity Facility, has the meaning specified in such Liquidity Facility.

 

“Standard & Poor’s” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business.

 

“Stated Amount”, with respect to any Liquidity Facility, means the Maximum Commitment (as defined in such Liquidity Facility) of the applicable Liquidity Provider.

 

“Stated Expiration Date” has the meaning specified in Section 3.5(d).

 

“Stated Interest Rate” means (i) with respect to the Class A Certificates, 7.250% per annum and (ii) with respect to the Class B Certificates, 9.250% per annum.

 

“Subordination Agent” has the meaning specified in the recital of parties to this Agreement.

 

“Subordination Agent Incumbency Certificate” has the meaning specified in Section 2.5(a).

 

“Subordination Agent Representatives” has the meaning specified in Section 2.5(a).

 

“Substitute Aircraft” has the meaning set forth in the Note Purchase Agreement.

 

“Successor Class A Trust” has the meaning assigned to such term in the definition of “Class A Trust Agreement”.

 

 

17

BACK 

“Successor Class B Trust” has the meaning assigned to such term in the definition of “Class B Trust Agreement”.

 

“Tax” and “Taxes” mean any and all taxes, fees, levies, duties, tariffs, imposts, and other charges of any kind (together with any and all interest, penalties, loss, damage, liability, expense,
additions to tax and additional amounts or costs incurred or imposed with respect thereto) imposed or otherwise assessed by the United States of America or by any state, local or foreign government (or any subdivision or agency thereof) or other taxing authority, including, without limitation:  taxes or other charges on or with respect to income, franchises, windfall or other profits, gross receipts, property, sales, use, capital stock, payroll, employment, social security, workers’ compensation,
unemployment compensation, or net worth and similar charges; taxes or other charges in the nature of excise, withholding, ad valorem, stamp, transfer, value added, taxes on goods and services, gains taxes, license, registration and documentation fees, customs duties, tariffs, and similar charges.

 

“Termination Notice”, with respect to any Liquidity Facility, has the meaning assigned to such term in such Liquidity Facility.

 

“Threshold Rating” means the short-term unsecured debt rating of P-1 by Moody’s and the short-term issuer credit rating of A-1 by Standard & Poor’s.

 

“Transfer” means, with respect to any particular Trust, the transfers contemplated by the Assignment and Assumption Agreement with respect to such Trust.

 

“Treasury Regulations” means regulations, including proposed or temporary regulations, promulgated under the Code.  References herein to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations
or other successor Treasury Regulations.

 

“Triggering Event” means (x) the occurrence of an Indenture Default under all of the Indentures resulting in a PTC Event of Default with respect to the most senior Class of Certificates then Outstanding, (y) the Acceleration of all of the outstanding Equipment Notes
(provided that, with respect to the period prior to the Delivery Period Expiry Date, the aggregate principal balance of such Equipment Notes is in excess of $240,000,000) or (z) the occurrence of a Continental Bankruptcy Event.

 

“Trust” means either of the Class A Trust or the Class B Trust.

 

“Trust Accounts” has the meaning specified in Section 2.2(a).

 

“Trust Agreement” means either of the Class A Trust Agreement or the Class B Trust Agreement.

 

“Trust Property” with respect to any Trust, has the meaning set forth in the Trust Agreement for such Trust.

 

“Trustee” means either of the Class A Trustee or the Class B Trustee.

 

 

18

BACK 

“Trustee Incumbency Certificate” has the meaning specified in Section 2.5(b).

 

“Trustee Representatives” has the meaning specified in Section 2.5(b).

 

“Unapplied Provider Advance”, with respect to any Liquidity Facility, has the meaning specified in such Liquidity Facility.

 

“Underwriters” means Morgan Stanley & Co. Incorporated, Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC.

 

“Underwriting Agreement” means the Underwriting Agreement dated October 27, 2009 among the Underwriters, the Depositary and Continental, relating to the purchase of the Certificates by the Underwriters, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with its terms.

 

“Written Notice” means, from the Subordination Agent, any Trustee or the Liquidity Provider, a written instrument executed by the Designated Representative of such Person.  An invoice delivered by a Liquidity Provider pursuant to Section 3.1 in accordance
with its normal invoicing procedures shall constitute Written Notice under such Section.

 

“WTC” has the meaning specified in the recital of parties to this Agreement.

 

 

ARTICLE II

 

TRUST ACCOUNTS; CONTROLLING PARTY

 

SECTION 2.1.  Agreement to Terms of Subordination; Payments from Monies Received Only.  (a)  Each Trustee hereby acknowledges and agrees to the
terms of subordination and distribution set forth in this Agreement in respect of each Class of Certificates and agrees to enforce such provisions and cause all payments in respect of the Equipment Notes held by the Subordination Agent and the Liquidity Facilities to be applied in accordance with the terms of this Agreement.  In addition, each Trustee hereby agrees to cause the Equipment Notes purchased by the related Trust to be registered in the name of the Subordination Agent or its nominee, as agent
and trustee for such Trustee, to be held in trust by the Subordination Agent solely for the purpose of facilitating the enforcement of the subordination and other provisions of this Agreement.

 

(b)           Except as otherwise expressly provided in the next succeeding sentence of this Section 2.1, all payments to be made by the Subordination Agent hereunder shall be made only from amounts received by it that constitute Scheduled Payments, Special Payments, payments under Section
8.1 of the Participation Agreements or payments under Section 6 of the Note Purchase Agreement, and only to the extent that the Subordination Agent shall have received sufficient income or proceeds therefrom to enable it to make such payments in accordance with the terms hereof.  Each of the Trustees and the Subordination Agent hereby agrees and, as provided in each Trust Agreement, each Certificateholder, by its acceptance of a Certificate and each Liquidity Provider, by entering into the Liquidity
Facility to which it is a party, has agreed to look solely to such amounts to the extent available for distribution to it as

 

 

19

BACK 

provided in this Agreement and to the relevant Deposits and that none of the Trustees, Loan Trustees nor the Subordination Agent is personally liable to any of them for any amounts payable or any liability under this Agreement, any Trust Agreement, any Liquidity Facility or such Certificate, except (in the case of the Subordination Agent)
as expressly provided herein or (in the case of the Trustees) as expressly provided in each Trust Agreement or (in the case of the Loan Trustees) as expressly provided in any Operative Agreement.

 

SECTION 2.2.  Trust Accounts.  (a)  Upon the execution of this Agreement, the Subordination Agent shall establish and maintain in its name (i) the Collection Account as an Eligible Deposit Account, bearing a designation clearly
indicating that the funds deposited therein are held in trust for the benefit of the Trustees, the Certificateholders and the Liquidity Providers and (ii) as a sub-account in the Collection Account, the Special Payments Account as an Eligible Deposit Account, bearing a designation clearly indicating that the funds deposited therein are held in trust for the benefit of the Trustees, the Certificateholders and the Liquidity Providers.  The Subordination Agent shall establish and maintain the Cash
Collateral Accounts pursuant to and under the circumstances set forth in Section 3.5(f) hereof.  Upon such establishment and maintenance under Section 3.5(f) hereof, the Cash Collateral Accounts shall, together with the Special Payments Account and the Collection Account, constitute the “Trust Accounts” hereunder.  Without limiting the foregoing, all monies credited to the Trust Accounts shall be, and shall remain,
the property of the relevant Trust(s).

 

(b)           Funds on deposit in the Trust Accounts shall be invested and reinvested by the Subordination Agent in Eligible Investments selected by the Subordination Agent if such investments are reasonably available and have maturities no later than the earlier of (i) 90 days following
the date of such investment and (ii) the Business Day immediately preceding the Regular Distribution Date or the date of the related distribution pursuant to Section 2.4 hereof, as the case may be, next following the date of such investment; provided, however, that following the making of a Downgrade Drawing, a Non-Extension Drawing or a Special Termination Drawing under any Liquidity
Facility, the Subordination Agent shall invest and reinvest such funds in Eligible Investments at the direction of Continental (or, if and to the extent so specified to the Subordination Agent by Continental with respect to any Liquidity Facility, the Liquidity Provider with respect to such Liquidity Facility); provided further, however,
that, notwithstanding the foregoing proviso, following the making of a Downgrade Drawing or a Non-Extension Drawing under any Liquidity Facility, the Subordination Agent shall invest and reinvest the amounts in the Cash Collateral Account with respect to such Liquidity Facility in Eligible Investments pursuant to the written instructions of the Liquidity Provider funding such Drawing; provided further, however,
that upon the occurrence and during the continuation of a Triggering Event, the Subordination Agent shall invest and reinvest such amounts in accordance with the written instructions of the Controlling Party.  Unless otherwise expressly provided in this Agreement (including, without limitation, with respect to Investment Earnings on amounts on deposit in the Cash Collateral Accounts pursuant to Section 3.5(f) hereof), any Investment Earnings shall be deposited in the Collection Account when received
by the Subordination Agent and shall be applied by the Subordination Agent in the same manner as the other amounts on deposit in the Collection Account are to be applied and any losses shall be charged against the principal amount invested, in each case net of the Subordination Agent’s reasonable fees and expenses in making such investments.  The Subordination Agent shall not be liable for any loss resulting from any investment, reinvestment or liquidation required to be made under this

 

 

20

BACK 

Agreement other than by reason of its willful misconduct or gross negligence.  Eligible Investments and any other investment required to be made hereunder shall be held to their maturities except that any such investment may be sold (without regard to its maturity) by the Subordination Agent without instructions whenever such sale
is necessary to make a distribution required under this Agreement.  Uninvested funds held hereunder shall not earn or accrue interest.

 

(c)           The Subordination Agent shall possess all right, title and interest in all funds on deposit from time to time in the Trust Accounts and in all proceeds thereof (including all income thereon, except as otherwise expressly provided in Section 3.3(b) with respect to Investment
Earnings).  The Trust Accounts shall be held in trust by the Subordination Agent under the sole dominion and control of the Subordination Agent for the benefit of the Trustees, the Certificateholders and the Liquidity Providers, as the case may be.  If, at any time, any of the Trust Accounts ceases to be an Eligible Deposit Account, the Subordination Agent shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, for which a Ratings Confirmation for each Class of
Certificates shall have been obtained) establish a new Collection Account, Special Payments Account or Cash Collateral Account, as the case may be, as an Eligible Deposit Account and shall transfer any cash and/or any investments to such new Collection Account, Special Payments Account or Cash Collateral Account, as the case may be.  So long as WTC is an Eligible Institution, the Trust Accounts shall be maintained with it as Eligible Deposit Accounts.

 

SECTION 2.3.  Deposits to the Collection Account and Special Payments Account.  (a)  The Subordination Agent shall, upon receipt thereof, deposit in the Collection Account all Scheduled Payments received by it (other than any Scheduled
Payment which by the express terms hereof is to be deposited to a Cash Collateral Account).

 

(b)           The Subordination Agent shall, on each date when one or more Special Payments are made to the Subordination Agent as holder of the Equipment Notes, deposit in the Special Payments Account the aggregate amount of such Special Payments.

 

SECTION 2.4.  Distributions of Special Payments.  (a)  Notice of Special Payment.  Except as provided in Section 2.4(c) below, upon receipt by the Subordination
Agent, as registered holder of the Equipment Notes, of any notice of a Special Payment (or, in the absence of any such notice, upon receipt by the Subordination Agent of a Special Payment), the Subordination Agent shall promptly give notice thereof to each Trustee and the Liquidity Providers.  The Subordination Agent shall promptly calculate the amount of the redemption or purchase of Equipment Notes, the amount of any Overdue Scheduled Payment or the proceeds of Equipment Notes or Collateral, as the
case may be, comprising such Special Payment under the applicable Indenture or Indentures and shall promptly send to each Trustee and each Liquidity Provider a Written Notice of such amount and the amount allocable to each Trust.  Such Written Notice shall also set the distribution date for such Special Payment (a “Special Distribution Date”), which shall be the Business Day which immediately follows the later to occur of (x)
the 15th day after the date of such Written Notice and (y) the date the Subordination Agent has received or expects to receive such Special Payment.  Amounts on deposit in the Special Payments Account shall be distributed in accordance with Sections 2.4(b) and 2.4(c) and Article III hereof, as applicable.

 

 

21

BACK 

For the purposes of the application of any Equipment Note Special Payment distributed on a Special Distribution Date in accordance with Section 3.2 hereof, so long as no Indenture Default shall have occurred and be continuing under any Indenture:

 

    (i)             the amount of accrued and unpaid Liquidity Expenses that are not yet due that are payable pursuant to clause “second” thereof shall be multiplied by the Section 2.4 Fraction;

 

    (ii)             clause “third” thereof shall be deemed to read as follows:  “third, such (x) amount as shall be required to pay accrued and unpaid interest then
in arrears on all Liquidity Obligations (at the rate, or in the amount, provided in the applicable Liquidity Facility) plus an amount equal to the amount of accrued and unpaid interest on the Liquidity Obligations not in arrears multiplied by the Section 2.4 Fraction, and (y) if a Special Termination Drawing has been made under any Liquidity Facility and has not been converted into a Final Drawing, the outstanding amount of such Special Termination Drawing shall be distributed to the Liquidity Providers, pro
rata on the basis of the amounts owed to each Liquidity Provider”;

 

(iii)            clause “seventh” thereof shall be deemed to read as follows:  “seventh, such amount as shall be required to pay accrued, due and unpaid interest at the Stated Interest Rate
on the outstanding Pool Balance of the Class A Certificates together with (without duplication) accrued and unpaid interest at the Stated Interest Rate on the outstanding principal amount of the Series A Equipment Notes held in the Class A Trust being redeemed, purchased or prepaid, in each case excluding interest, if any, payable with respect to the Deposits relating to the Class A Trust”;

 

(iv)           clause “eighth” thereof shall be deemed to read as follows:  “eighth, such amount as shall be required to pay any accrued, due and unpaid Class B Adjusted Interest shall be distributed
to the holders of the Class B Certificates (excluding interest, if any, payable with respect to the Deposits relating to the Class B Trust)”; and

 

(v)             clause “tenth” thereof shall be deemed to read as follows:  “tenth, such amount as shall be required to pay in full accrued, due and unpaid interest at the Stated Interest
Rate on the outstanding Pool Balance of the Class B Certificates which was not previously paid pursuant to clause “eighth” above to the holders of the Class B Certificates, together with (without duplication) accrued and unpaid interest at the Stated Interest Rate on the outstanding principal amount of the Series B Equipment Notes held in the Class B Trust and being redeemed, purchased or prepaid, in each case excluding interest, if any, payable with respect to the Deposits relating to the Class B
Trust;”.

 

(b)           Investment of Amounts in Special Payments Account.  Any amounts on deposit in the Special Payments Account prior to the distribution thereof pursuant to Section 2.4 or 3.2 shall be invested in accordance
with Section 2.2(b).  Investment Earnings on such investments shall be distributed in accordance with Article III hereof.

 

(c)           Certain Payments.  Except for amounts constituting Liquidity Obligations which shall be distributed as provided in Section 3.2, the Subordination Agent will distribute promptly upon receipt thereof
(i) any indemnity payment or expense reimbursement received by

 

 

22

BACK 

it from Continental in respect of any Trustee, any Liquidity Provider, any Paying Agent, any Depositary or any Escrow Agent (collectively, the “Payees”) and (ii) any compensation received by it from Continental under any Operative Agreement in respect of any Payee,
directly to the Payee entitled thereto.

 

SECTION 2.5.  Designated Representatives.  (a)  With the delivery of this Agreement, the Subordination Agent shall furnish to each Liquidity Provider and each Trustee, and from time to time thereafter may furnish to each Liquidity
Provider and each Trustee, at the Subordination Agent’s discretion, or upon any Liquidity Provider’s or any Trustee’s request (which request shall not be made more than one time in any 12-month period), a certificate (a “Subordination Agent Incumbency Certificate”) of a Responsible Officer of the Subordination Agent certifying as to the incumbency and specimen signatures of the officers of the Subordination Agent and
the attorney-in-fact and agents of the Subordination Agent (the “Subordination Agent Representatives”) authorized to give Written Notices on behalf of the Subordination Agent hereunder.  Until each Liquidity Provider and each Trustee receives a subsequent Subordination Agent Incumbency Certificate, it shall be entitled to rely on the last Subordination Agent Incumbency Certificate delivered to it hereunder.

 

(b)           With the delivery of this Agreement, each Trustee shall furnish to the Subordination Agent, and from time to time thereafter may furnish to the Subordination Agent, at such Trustee’s discretion, or upon the Subordination Agent’s request (which request shall not
be made more than one time in any 12-month period), a certificate (a “Trustee Incumbency Certificate”) of a Responsible Officer of such Trustee certifying as to the incumbency and specimen signatures of the officers of such Trustee and the attorney-in-fact and agents of such Trustee (the “Trustee Representatives”) authorized to give Written Notices on behalf
of such Trustee hereunder.  Until the Subordination Agent receives a subsequent Trustee Incumbency Certificate, it shall be entitled to rely on the last Trustee Incumbency Certificate delivered to it hereunder.

 

(c)           With the delivery of this Agreement, each Liquidity Provider shall furnish to the Subordination Agent, and from time to time thereafter may furnish to the Subordination Agent, at such Liquidity Provider’s discretion, or upon the Subordination Agent’s request
(which request shall not be made more than one time in any 12-month period), a certificate (each, a “Provider Incumbency Certificate”) of any Responsible Officer of such Liquidity Provider certifying as to the incumbency and specimen signatures of any officer, attorney-in-fact, agent or other designated representative of such Liquidity Provider (in each case, the “Provider
Representatives” and, together with the Subordination Agent Representatives and the Trustee Representatives, the “Designated Representatives”) authorized to give Written Notices on behalf of such Liquidity Provider hereunder.  Until the Subordination Agent receives a subsequent Provider Incumbency Certificate, it shall be entitled to rely on the last Provider Incumbency Certificate delivered to it hereunder by
the relevant Liquidity Provider.

 

SECTION 2.6.  Controlling Party.  (a)  The Trustees and the Liquidity Providers hereby agree that, with respect to any Indenture at any given time, the Loan Trustee thereunder will be directed in taking, or refraining from taking,
any action under such Indenture or with respect to the Equipment Notes issued thereunder (i) so long as no Indenture Default has occurred and is continuing thereunder, by the holders of at least a majority of the outstanding

 

 

23

BACK 

principal amount of such Equipment Notes (provided that, for so long as the Subordination Agent is the registered holder of the Equipment Notes, the Subordination Agent shall act with respect to this clause (i) in accordance with the directions of the Trustees (in the case of each such Trustee, with respect to the Equipment Notes issued under
such Indenture and held as Trust Property of such Trust) constituting, in the aggregate, directions with respect to at least a majority of outstanding principal amount of Equipment Notes except as provided in Section 9.1(b)), and (ii) after the occurrence and during the continuance of an Indenture Default thereunder, in taking, or refraining from taking, any action under such Indenture or with respect to such Equipment Notes, including exercising remedies thereunder (including Accelerating the Equipment Notes
issued thereunder or foreclosing the Lien on the Aircraft securing such Equipment Notes), by the Controlling Party.

 

(b)           The “Controlling Party” shall be (x) the Class A Trustee and (y) upon payment of Final Distributions to the holders of Class A Certificates, the Class B Trustee.  For purposes of giving effect to the provisions of Section 2.6(a) and this Section
2.6(b), the Trustees (other than the Controlling Party) irrevocably agree (and the Certificateholders (other than the Certificateholders represented by the Controlling Party) shall be deemed to agree by virtue of their purchase of Certificates) that the Subordination Agent, as record holder of the Equipment Notes, shall exercise its voting rights in respect of the Equipment Notes so held by the Subordination Agent as directed by the Controlling Party and any vote so exercised shall be binding upon the Trustees
and all Certificateholders.

 

The Subordination Agent shall give Written Notice to all of the other parties to this Agreement promptly upon a change in the identity of the Controlling Party.  Each of the parties hereto agrees that it shall not exercise any of the rights of the Controlling Party at such time as it is not the Controlling Party hereunder; provided, however,
that nothing herein contained shall prevent or prohibit any Non-Controlling Party from exercising such rights as shall be specifically granted to such Non-Controlling Party hereunder and under the other Operative Agreements.

 

(c)           Notwithstanding the foregoing provisions of clauses (a) and (b) above, at any time after 18 months from the earliest to occur of (i) the date on which the entire Required Amount as of such date under any Liquidity Facility shall have been drawn (excluding a Downgrade Drawing,
a Non-Extension Drawing or a Special Termination Drawing but including a Final Drawing or a Downgrade Drawing, a Non-Extension Drawing or a Special Termination Drawing that has been converted to a Final Drawing under such Liquidity Facility) and shall remain unreimbursed, (ii) the date on which the portion of any Downgrade Drawing, Non-Extension Drawing or Special Termination Drawing equal to the Required Amount as of such date under any Liquidity Facility shall have become and remain “Applied Downgrade
Advances”, “Applied Non-Extension Advances” or “Applied Special Termination Advances”, as the case may be, under and as defined in such Liquidity Facility and (iii) the date on which all Equipment Notes under all Indentures shall have been Accelerated (provided that (x) with respect to the period prior to the Delivery Period Expiry Date, such Equipment Notes have an aggregate outstanding principal balance of in excess
of $240,000,000, and (y) in the event of a bankruptcy proceeding under the Bankruptcy Code in which Continental is a debtor, any amounts payable in respect of Equipment Notes which have become immediately due and payable by declaration or otherwise shall not be considered Accelerated for purposes of this sub-

 

 

24

BACK 

clause (iii) until the expiration of the 60-day period under Section 1110(a)(2)(A) of the Bankruptcy Code or such longer period as may apply under Section 1110(a)(2)(B) or Section 1110(b) of the Bankruptcy Code), the Liquidity Provider with the highest outstanding aggregate amount of Liquidity Obligations owed to it (so long as such Liquidity
Provider has not defaulted in its obligation to make any Drawing under any Liquidity Facility) shall have the right to elect, by Written Notice to the Subordination Agent and each of the Trustees, to become the Controlling Party hereunder at any time from and including the last day of such 18-month period.

 

(d)           The exercise of remedies by the Controlling Party under this Agreement shall be expressly limited by Sections 4.1(a)(ii) and 4.1(a)(iii) hereof.

 

(e)           The Controlling Party shall not be entitled to require or obligate any Non-Controlling Party to provide funds necessary to exercise any right or remedy hereunder.

 

 

ARTICLE III

 

RECEIPT, DISTRIBUTION AND APPLICATION

OF AMOUNTS RECEIVED

 

SECTION 3.1.  Written Notice of Distribution.  (a)  No later than 3:00 P.M. (New York City time) on the Business Day immediately preceding each Distribution Date, each of the following Persons shall deliver to the Subordination
Agent a Written Notice setting forth the following information as at the close of business on such Business Day:

 

(i)           with respect to the Class A Certificates, the Class A Trustee shall separately set forth the amounts to be paid in accordance with clause “first” of Section 3.2 hereof (to reimburse payments made by such Trustee or the Class A Certificateholders, as the case
may be, pursuant to subclause (ii) or (iv) of clause “first”), subclauses (ii) and (iii) of clause “sixth” of Section 3.2 hereof and clauses “seventh” and “ninth” of Section 3.2 hereof;

 

(ii)           with respect to the Class B Certificates, the Class B Trustee shall separately set forth the amounts to be paid in accordance with clause “first” of Section 3.2 hereof (to reimburse payments made by such Trustee or the Class B Certificateholders, as the case
may be, pursuant to subclause (ii) or (iv) of clause “first”), subclauses (ii) and (iii) of clause “sixth” of Section 3.2 hereof and clauses “eighth”, “tenth” and “eleventh” of Section 3.2 hereof;

 

(iii)           with respect to each Liquidity Facility, the Liquidity Provider thereunder shall separately set forth the amounts to be paid to it in accordance with subclauses (iii) and (iv) of clause “first” of Section 3.2 hereof, clause “second” of Section
3.2 hereof, clause “third” of Section 3.2 hereof, clause “fourth” of Section 3.2 hereof and clause “fifth” of Section 3.2 hereof; and

 

(iii)           each Trustee shall set forth the amounts to be paid in accordance with clause “sixth” of Section 3.2 hereof.

 

 

25

BACK 

(b)           At such time as a Trustee or a Liquidity Provider shall have received all amounts owing to it (and, in the case of a Trustee, the Certificateholders for which it is acting) pursuant to Section 3.2 hereof, as applicable, and, in the case of a Liquidity Provider, its commitment
or obligations under the related Liquidity Facility shall have terminated or expired, such Person shall, by a Written Notice, so inform the Subordination Agent and each other party to this Agreement.

 

(c)           As provided in Section 6.5 hereof, the Subordination Agent shall be fully protected in relying on any of the information set forth in a Written Notice provided by any Trustee or any Liquidity Provider pursuant to paragraphs (a) and (b) above and shall have no independent
obligation to verify, calculate or recalculate any amount set forth in any Written Notice delivered in accordance with such paragraphs.

 

(d)           Any Written Notice delivered by a Trustee, a Liquidity Provider or the Subordination Agent, as applicable, pursuant to Section 3.1(a) hereof, if made prior to 10:00 A.M. (New York City time) on any Business Day, shall be effective on the date delivered (or if delivered later
on a Business Day or if delivered on a day which is not a Business Day shall be effective as of the next Business Day).  Subject to the terms of this Agreement, the Subordination Agent shall as promptly as practicable comply with any such instructions; provided, however, that any transfer of funds pursuant to any instruction received after 10:00 A.M. (New York City time)
on any Business Day may be made on the next succeeding Business Day.

 

(e)           In the event the Subordination Agent shall not receive from any Person any information set forth in paragraph (a) above which is required to enable the Subordination Agent to make a distribution to such Person pursuant to Section 3.2 hereof, the Subordination Agent shall
request such information and, failing to receive any such information, the Subordination Agent shall not make such distribution(s) to such Person.  In such event, the Subordination Agent shall make distributions pursuant to clauses “first” through “eleventh” of Section 3.2 to the extent it shall have sufficient information to enable it to make such distributions, and shall continue to hold any funds remaining, after making such distributions, until the Subordination Agent shall
receive all necessary information to enable it to distribute any funds so withheld.

 

(f)           On such dates (but not more frequently than monthly) as any Liquidity Provider or any Trustee shall request, but in any event automatically at the end of each calendar quarter, the Subordination Agent shall send to such party a written statement reflecting all amounts on
deposit with the Subordination Agent pursuant to Section 3.1(e) hereof.

 

The notices required under this Section 3.1(a) may be in the form of a schedule or similar document provided to the Subordination Agent by the parties referenced therein or by any one of them, which schedule or similar document may state that, unless there has been a prepayment of the Certificates, such schedule or similar document is to
remain in effect until any substitute notice or amendment shall be given to the Subordination Agent by the party providing such notice.

 

SECTION 3.2.  Distribution of Amounts on Deposit in the Collection Account.  Except as otherwise provided in Sections 2.4, 3.1(e), 3.3, 3.5(b), 3.5(k) and 3.5(m), amounts on

 

 

26

BACK 

deposit in the Collection Account (including amounts on deposit in the Special Payments Account) shall be promptly distributed on each Regular Distribution Date (or, in the case of any amount described in Section 2.4(a), on the Special Distribution Date thereof) in the following order of priority and in accordance with the information provided
to the Subordination Agent pursuant to Section 3.1(a) hereof:

 

first, such amount as shall be required to reimburse (i) the Subordination Agent for any reasonable out-of-pocket costs and expenses actually incurred by it (to the extent not previously reimbursed) or reasonably expected to be incurred by it for the period ending on the
next succeeding Regular Distribution Date (which shall not exceed $150,000 unless approved in writing by the Controlling Party) in the protection of, or the realization of the value of, the Equipment Notes or any Collateral, shall be applied by the Subordination Agent in reimbursement of such costs and expenses, (ii) any Trustee for any amounts of the nature described in clause (i) above actually incurred by it under the applicable Trust Agreement (to the extent not previously reimbursed), shall be
distributed to such Trustee, (iii) any Liquidity Provider for any amounts of the nature described in clause (i) above actually incurred by it (to the extent not previously reimbursed), shall be distributed to such Liquidity Provider, and (iv) any Liquidity Provider or any Certificateholder for payments, if any, made by it to the Subordination Agent or any Trustee in respect of amounts described in clause (i) above actually incurred by it (to the extent not previously reimbursed) (collectively,
the “Administration Expenses”), shall be distributed to such Liquidity Provider or the applicable Trustee for the account of such Certificateholder, in each such case, pro rata on the basis of all amounts described in clauses (i) through (iv) above;

 

second, such amount as shall be required to pay all accrued and unpaid Liquidity Expenses owed to each Liquidity Provider shall be distributed to the Liquidity Providers pro rata on the basis of the amount of Liquidity Expenses owed to each Liquidity Provider;

 

third, (i) such amount as shall be required to pay the aggregate amount of accrued and unpaid interest on all Liquidity Obligations (at the rate, or in the amount, provided in the applicable Liquidity Facility) shall be distributed to the Liquidity Providers pro rata on the
basis of the amounts owed to each Liquidity Provider and (ii) if a Special Termination Drawing has been made under any Liquidity Facility and has not been converted into a Final Drawing, the outstanding amount of such Special Termination Drawing shall be distributed to the Liquidity Providers pro rata on the basis of the amounts owed to each Liquidity Provider;

 

fourth, such amount as shall be required (A) if any Cash Collateral Account had been previously funded as provided in Section 3.5(f), unless (i) a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing with respect to the
relevant Liquidity Facility or (ii) a Final Drawing shall have occurred with respect to such Liquidity Facility, to fund such Cash Collateral Account up to its Required Amount shall be deposited in such Cash Collateral Account, (B) if any Liquidity Facility shall become a Downgraded Facility or a Non-Extended Facility at a time when unreimbursed Interest Drawings under such Liquidity Facility have reduced

 

 

27

BACK 

the Available Amount thereunder to zero, unless (i) a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing with respect to the relevant Liquidity Facility or (ii) a Final Drawing shall have occurred with respect to such Liquidity Facility, to deposit into the related Cash Collateral Account
an amount equal to such Cash Collateral Account’s Required Amount shall be deposited in such Cash Collateral Account, and (C) if, with respect to any particular Liquidity Facility, neither subclause (A) nor subclause (B) of this clause “fourth” is applicable, to pay or reimburse the Liquidity Provider in respect of such Liquidity Facility in an amount equal to the amount of all Liquidity Obligations then due under such Liquidity Facility (other than amounts payable pursuant to clause “second”
or “third” of this Section 3.2), pro rata on the basis of amounts of all such deficiencies and/or unreimbursed Liquidity Obligations payable to each Liquidity Provider;

 

fifth, if, with respect to any particular Liquidity Facility, any amounts are to be distributed pursuant to either subclause (A) or (B) of clause “fourth” above, then the Liquidity Provider with respect to such Liquidity Facility shall be paid the excess of (x) the
aggregate outstanding amount of unreimbursed Advances (whether or not then due) under such Liquidity Facility over (y) the Required Amount for the relevant Class, pro rata on the basis of such amounts in respect of each Liquidity Provider;

 

sixth, such amount as shall be required to reimburse or pay (i) the Subordination Agent for any Tax (other than Taxes imposed on compensation paid hereunder), expense, fee, charge or other loss incurred by or any other amount payable to the Subordination Agent in connection
with the transactions contemplated hereby (to the extent not previously reimbursed), shall be applied by the Subordination Agent in reimbursement of such amount, (ii) each Trustee for any Tax (other than Taxes imposed on compensation paid under the applicable Trust Agreement), expense, fee, charge, loss or any other amount payable to such Trustee under the applicable Trust Agreement (to the extent not previously reimbursed), shall be distributed to such Trustee, and (iii) each Certificateholder for
payments, if any, made by it pursuant to Section 5.2 hereof in respect of amounts described in clause (i) above, shall be distributed to the applicable Trustee for the account of such Certificateholder, in each case, pro rata on the basis of all amounts described in clauses (i) through (iii) above;

 

seventh, such amount as shall be required to pay in full accrued and unpaid interest at the Stated Interest Rate on the Pool Balance of the Class A Certificates (excluding interest, if any, payable with respect to the Deposits relating to the Class A Trust) shall be distributed
to the Class A Trustee;

 

eighth, such amount as shall be required to pay unpaid Class B Adjusted Interest shall be distributed to the holders of the Class B Certificates (excluding interest, if any, payable with respect to the Deposits relating to the Class B Trust);

 

ninth, such amount as shall be required to pay in full Expected Distributions to the holders of the Class A Certificates on such Distribution Date shall be distributed to the Class A Trustee;

 

 

28

BACK 

tenth, such amount as shall be required to pay in full accrued and unpaid interest at the Stated Interest Rate on the Pool Balance of the Class B Certificates which was not previously paid pursuant to clause ”eighth” above to the holders of the Class B
Certificates (excluding interest, if any, payable with respect to the Deposits related to the Class B Trust);

 

eleventh, such amount as shall be required to pay in full Expected Distributions to the holders of the Class B Certificates on such Distribution Date shall be distributed to the Class B Trustee; and

 

twelfth, the balance, if any, of any such amount remaining thereafter shall be held in the Collection Account for later distribution in accordance with this Article III.

 

With respect to clauses “first” and “sixth” above, no amounts shall be reimbursable to the Subordination Agent, any Trustee, any Liquidity Provider or any Certificateholder for any payments made by any such Person in connection with any Equipment Note that is no longer held by the Subordination Agent (to the extent
that such payments relate to periods after such Equipment Note ceases to be held by the Subordination Agent).

 

SECTION 3.3.  Other Payments.  (a)  Any payments received by the Subordination Agent for which no provision as
to the application thereof is made in this Agreement shall be distributed by the Subordination Agent (i) in the order of priority specified in Section 3.2 hereof and (ii) to the extent received or realized at any time after the Final Distributions for each Class of Certificates have been made, in the manner provided in clause “first” of Section 3.2 hereof.

 

(b)           Notwithstanding the priority of payments specified in Section 3.2, in the event any Investment Earnings on amounts on deposit in any Cash Collateral Account resulting from an Unapplied Provider Advance are deposited in the Collection Account or the Special Payments Account,
such Investment Earnings shall be used to pay interest payable in respect of such Unapplied Provider Advance to the extent of such Investment Earnings.

 

(c)           If the Subordination Agent receives any Scheduled Payment after the Scheduled Payment Date relating thereto, but prior to such payment becoming an Overdue Scheduled Payment, then the Subordination Agent shall deposit such Scheduled Payment in the Collection Account and promptly
distribute such Scheduled Payment in accordance with the priority of distributions set forth in Section 3.2 hereof; provided that, for the purposes of this Section 3.3(c) only, each reference in clause “ninth” or “eleventh” of Section 3.2 to “Distribution Date” shall be deemed to refer to such Scheduled Payment Date.

 

SECTION 3.4.  Payments to the Trustees and the Liquidity Providers.  Any amounts distributed hereunder to any Liquidity Provider shall be paid to such Liquidity Provider by
wire transfer of funds to the account that such Liquidity Provider shall provide to the Subordination Agent.  The Subordination Agent shall provide a Written Notice of any such transfer to the applicable Liquidity Provider at the time of such transfer.  Any amounts distributed hereunder by the Subordination Agent to any Trustee which shall not be the same

 

 

29

BACK 

institution as the Subordination Agent shall be paid to such Trustee by wire transfer to the account such Trustee shall provide to the Subordination Agent.

 

SECTION 3.5.  Liquidity Facilities.  (a)  Interest Drawings.  If on any Distribution Date, after
giving effect to the subordination provisions of this Agreement, the Subordination Agent shall not have sufficient funds for the payment of any amounts due and owing in respect of accrued interest on the Class A Certificates or the Class B Certificates (at the Stated Interest Rate for such Class of Certificates) (other than any amount of interest which was due and payable on the Class A Certificates or the Class B 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), then, prior to 12:30 p.m. (New York City time) on such Distribution Date, (i) the Subordination Agent shall request a drawing (each such drawing, an “Interest Drawing”) under the Liquidity Facility with respect to such Class of Certificates in an amount equal to the lesser of (x) an amount sufficient to pay the amount of such accrued interest
(at the applicable Stated Interest Rate for such Class of Certificates) and (y) the Available Amount under such Liquidity Facility, and shall pay such amount to the Trustee with respect to such Class of Certificates in payment of such accrued interest.

 

(b)           Application of Interest Drawings.  Notwithstanding anything to the contrary contained in this Agreement, (i) all payments received by the Subordination Agent in respect of an Interest Drawing under
the Class A Liquidity Facility and all amounts withdrawn by the Subordination Agent from the Class A Cash Collateral Account, and payable in each case to the Class A Certificateholders or the Class A Trustee, shall be promptly distributed to the Class A Trustee and (ii) all payments received by the Subordination Agent in respect of an Interest Drawing under the Class B Liquidity Facility and all amounts withdrawn by the Subordination Agent from the Class B Cash Collateral Account, and payable in each case to
the Class B Certificateholders or the Class B Trustee, shall be promptly distributed to the Class B Trustee.

 

(c)           Downgrade Drawings.  (i) With respect to each Liquidity Facility, a Downgrade Drawing shall be requested by the Subordination Agent thereunder as provided in Section 3.5(c)(iii), if at any time a
Downgrade Event shall have occurred with respect to such Liquidity Facility (such Liquidity Facility following a Downgrade Event being referred to as a “Downgraded Facility”), unless an event described in Section 3.5(c)(ii) occurs with respect to such Liquidity Facility.

 

(ii)  If at any time any Liquidity Facility becomes a Downgraded Facility, the Subordination Agent shall request a Downgrade Drawing thereunder in accordance with Section 3.5(c)(iii), unless the Liquidity Provider under such Downgraded Facility or Continental arranges for a Replacement
Liquidity Provider to issue and deliver a Replacement Liquidity Facility to the Subordination Agent within 10 days after receiving notice of a Downgrade Event (but not later than the expiration date of such Downgraded Facility).

 

(iii)  Upon the occurrence of any Downgrade Event with respect to any Liquidity Facility, unless a Replacement Liquidity Facility is arranged as provided in Section 3.5(c)(ii), the Subordination Agent shall, on the 10th day referred to in Section 3.5(c)(ii) (or if such 10th day is
not a Business Day, on the next succeeding Business Day) (or, if earlier, the

 

 

30

BACK 

expiration date of such Downgraded Facility), request a drawing in accordance with and to the extent permitted by such Downgraded Facility (such drawing, a “Downgrade Drawing”) of the Available Amount thereunder.  Amounts drawn pursuant to a Downgrade Drawing
shall be maintained and invested as provided in Section 3.5(f) hereof.  The applicable Liquidity Provider may also arrange for a Replacement Liquidity Provider to issue and deliver a Replacement Liquidity Facility at any time after such Downgrade Drawing so long as such Downgrade Drawing has not been reimbursed in full to such Liquidity Provider.

 

(d)           Non-Extension Drawings.  If at any time any Liquidity Facility with respect to any Class of Certificates is scheduled to expire on a date (the “Stated
Expiration Date”) prior to the date that is 15 days after the Final Legal Distribution Date for such Class of Certificates, then, no earlier than the 60th day and no later than the 40th day prior to the then Stated Expiration Date, the Subordination Agent shall request that the applicable Liquidity Provider extend the Stated Expiration Date until the earlier of (i) the date which is 15 days after such Final Legal Distribution Date and (ii) the date that is the day immediately preceding the 364th day
occurring after the last day of the applicable Consent Period (as hereinafter defined) (unless the obligations of such Liquidity Provider under such Liquidity Facility are earlier terminated in accordance with such Liquidity Facility).  Whether or not the Liquidity Provider has received a request from the Subordination Agent, such Liquidity Provider shall advise the Subordination Agent, no earlier than the 40th day (or, if
earlier, the date of such Liquidity Provider’s receipt of such request, if any, from the Subordination Agent) and no later than the 25th day prior to the Stated Expiration Date then in effect for such Liquidity Facility (such period, with respect to such Liquidity Facility, the “Consent Period”), whether, in its sole discretion, it agrees to extend such
Stated Expiration Date.  If (A) on or before the date on which such Consent Period ends, such Liquidity Facility shall not have been replaced in accordance with Section 3.5(e) and (B) the applicable Liquidity Provider fails irrevocably and unconditionally to advise the Subordination Agent on or before the date on which such Consent Period ends that such Stated Expiration Date then in effect shall be so extended for such Liquidity Facility, the Subordination Agent shall, on the date on which such Consent
Period ends (or as soon as possible thereafter), in accordance with the terms of the expiring Liquidity Facility (a “Non-Extended Facility”), request a drawing under such expiring Liquidity Facility (such drawing, a “Non-Extension Drawing”) of the Available Amount thereunder.  Amounts drawn pursuant to a Non-Extension Drawing shall be maintained and
invested in accordance with Section 3.5(f) hereof.

 

(e)           Issuance of Replacement Liquidity Facility.  (i)  At any time, Continental may, at its option, with cause or without cause, arrange for a Replacement Liquidity Facility to replace any Liquidity
Facility for any Class of Certificates (including any Replacement Liquidity Facility provided pursuant to Section 3.5(e)(ii) hereof); provided, however, that the initial Liquidity Provider for any Liquidity Facility shall not be replaced by Continental as a Liquidity Provider with respect to such Liquidity Facility prior to the third anniversary of the Closing Date unless (A) there
shall have become due to such initial Liquidity Provider, or such initial Liquidity Provider shall have demanded, amounts pursuant to Section 3.01, 3.02 or 3.03 of any applicable Liquidity Facility and the replacement of such initial Liquidity Provider would reduce or eliminate the obligation to pay such amounts or Continental determines in good faith that there is a substantial likelihood that such initial Liquidity Provider will have the right to claim any such amounts (unless such initial Liquidity Provider
waives, in writing, any right it may

 

 

31

BACK 

have to claim such amounts), which determination shall be set forth in a certificate delivered by Continental to such initial Liquidity Provider setting forth the basis for such determination and accompanied by an opinion of outside counsel selected by Continental and reasonably acceptable to such initial Liquidity Provider verifying the legal
conclusions, if any, of such certificate relating to such basis, provided that, in the case of any likely claim for such amounts based upon any proposed, or proposed change in, law, rule, regulation, interpretation, directive, requirement, request or administrative practice, such opinion may assume the adoption or promulgation of such proposed matter, (B) it shall become unlawful or impossible for such initial Liquidity Provider (or its Facility
Office) to maintain or fund its LIBOR Advances as described in Section 3.10 of any Liquidity Facility, (C) any Liquidity Facility of such initial Liquidity Provider shall become a Downgraded Facility or a Non-Extended Facility or a Downgrade Drawing or a Non-Extension Drawing shall have occurred under any Liquidity Facility of such initial Liquidity Provider or (D) such initial Liquidity Provider shall have breached any of its payment (including, without limitation, funding) obligations under any Liquidity Facility
in respect of which it is the Liquidity Provider.  If such Replacement Liquidity Facility is provided at any time after a Downgrade Drawing, a Non-Extension Drawing or a Special Termination Drawing has been made, all funds on deposit in the relevant Cash Collateral Account will be returned to the Liquidity Provider being replaced.

 

(ii)           If any Liquidity Provider shall determine not to extend any of its Liquidity Facilities in accordance with Section 3.5(d), then such Liquidity Provider may, at its option, arrange for a Replacement Liquidity Facility
to replace such Liquidity Facility during the period no earlier than 40 days and no later than 25 days prior to the then effective Expiry Date of such Liquidity Facility.  At any time after a Non-Extension Drawing has been made under any Liquidity Facility, the Liquidity Provider thereunder may, at its option, arrange for a Replacement Liquidity Facility to replace the Liquidity Facility under which such Non-Extension Drawing has been made.

 

(iii)           No Replacement Liquidity Facility arranged by Continental or a Liquidity Provider in accordance with clause (i) or (ii) above or pursuant to Section 3.5(c), respectively, shall become effective and no such Replacement Liquidity
Facility shall be deemed a “Liquidity Facility” under the Operative Agreements, unless and until (A) each of the conditions referred to in sub-clauses (iv)(x) and (z) below shall have been satisfied, (B) if such Replacement Liquidity Facility shall materially adversely affect the rights, remedies, interests or obligations of the Class A Certificateholders or the Class B Certificateholders under any of the Operative Agreements, the applicable Trustee shall have consented, in writing, to the execution
and issuance of such Replacement Liquidity Facility and (C) in the case of a Replacement Liquidity Facility arranged by a Liquidity Provider under Section 3.5(e)(ii) or pursuant to Section 3.5(c), such Replacement Liquidity Facility is acceptable to Continental.

 

(iv)           In connection with the issuance of each Replacement Liquidity Facility, the Subordination Agent shall (x) prior to the issuance of such Replacement Liquidity Facility, obtain written confirmation from each Rating Agency that
such Replacement Liquidity Facility will not cause a reduction of any rating then in effect for any Class of Certificates by such Rating Agency (without regard to any downgrading of any rating of any Liquidity Provider being replaced pursuant to Section 3.5(c) hereof), (y) pay all Liquidity Obligations then owing to the replaced Liquidity Provider (which payment shall be made first from available funds in the

 

 

32

BACK 

applicable Cash Collateral Account as described in clause (v) of Section 3.5(f) hereof, and thereafter from any other available source, including, without limitation, a drawing under the Replacement Liquidity Facility) and (z) cause the issuer of the Replacement Liquidity Facility to deliver the Replacement Liquidity Facility to the Subordination
Agent, together with a legal opinion opining that such Replacement Liquidity Facility is an enforceable obligation of such Replacement Liquidity Provider.

 

(v)           Upon satisfaction of the conditions set forth in clauses (iii) and (iv) of this Section 3.5(e) with respect to a Replacement Liquidity Facility, (w) the replaced Liquidity Facility shall terminate, (x) the Subordination Agent
shall, if and to the extent so requested by Continental or the Liquidity Provider being replaced, execute and deliver any certificate or other instrument required in order to terminate the replaced Liquidity Facility, shall surrender the replaced Liquidity Facility to the Liquidity Provider being replaced and shall execute and deliver the Replacement Liquidity Facility and any associated Fee Letters, (y) each of the parties hereto shall enter into any amendments to this Agreement necessary to give effect to (1)
the replacement of the applicable Liquidity Provider with the applicable Replacement Liquidity Provider and (2) the replacement of the applicable Liquidity Facility with the applicable Replacement Liquidity Facility and (z) the applicable Replacement Liquidity Provider shall be deemed to be a Liquidity Provider with the rights and obligations of a Liquidity Provider hereunder and under the other Operative Agreements and such Replacement Liquidity Facility shall be deemed to be a Liquidity Facility hereunder and
under the other Operative Agreements.

 

(f)           Cash Collateral Accounts; Withdrawals; Investments.  In the event the Subordination Agent shall draw all available amounts under the Class A Liquidity Facility or the Class B Liquidity Facility pursuant
to Section 3.5(c), 3.5(d), 3.5(i) or 3.5(m) hereof, or in the event amounts are to be deposited in the Class A Cash Collateral Account or the Class B Cash Collateral Account pursuant to subclause (A) or (B) of clause “fourth” of Section 3.2, amounts so drawn or to be deposited, as the case may be, shall be deposited by the Subordination Agent in the Class A Cash Collateral Account or the Class B Cash Collateral Account, as applicable.  All amounts on deposit in each Cash Collateral Account
shall be invested and reinvested in Eligible Investments in accordance with Section 2.2(b) hereof.

 

On each Interest Payment Date (or, in the case of any Special Distribution Date with respect to the distribution of a Special Payment, on such Special Distribution Date), Investment Earnings on amounts on deposit in each Cash Collateral Account with respect to any Liquidity Facility (or, in the case of any Special Distribution Date with respect
to the distribution of a Special Payment, so long as no Indenture Default shall have occurred and be continuing under any Indenture, a fraction of such Investment Earnings equal to the Section 2.4 Fraction) shall be deposited in the Collection Account (or, in the case of any Special Distribution Date with respect to the distribution of a Special Payment, the Special Payments Account) and applied on such Interest Payment Date (or Special Distribution Date, as the case may be) in accordance with Section 3.2 or
3.3 (as applicable).  The Subordination Agent shall deliver a written statement to Continental and each Liquidity Provider one day prior to each Interest Payment Date and Special Distribution Date setting forth the aggregate amount of Investment Earnings held in the Cash Collateral Accounts as of such date.  In addition, from and after the date funds are so deposited, the Subordination Agent shall make withdrawals from such accounts as follows:

 

 

33

BACK 

(i)           on each Distribution Date, the Subordination Agent shall, to the extent it shall not have received funds to pay accrued and unpaid interest due and owing on the Class A Certificates (at the Stated Interest Rate for the Class A Certificates) after giving effect to the subordination
provisions of this Agreement, withdraw from the Class A Cash Collateral Account, and pay to the Class A Trustee, an amount equal to the lesser of (x) an amount necessary to pay accrued and unpaid interest (at the Stated Interest Rate for the Class A Certificates) on the Class A Certificates (excluding interest, if any, payable with respect to the Deposits relating to the Class A Trust) and (y) the amount on deposit in the Class A Cash Collateral Account;

 

(ii)           on each Distribution Date, the Subordination Agent shall, to the extent it shall not have received funds to pay accrued and unpaid interest due and owing on the Class B Certificates (at the Stated Interest Rate for the Class B Certificates) after giving effect to the subordination
provisions of this Agreement, withdraw from the Class B Cash Collateral Account, and pay to the Class B Trustee, an amount equal to the lesser of (x) an amount necessary to pay accrued and unpaid interest (at the Stated Interest Rate for the Class B Certificates) on the Class B Certificates (excluding interest, if any, payable with respect to the Deposits relating to the Class B Trust) and (y) the amount on deposit in the Class B Cash Collateral Account;

 

(iii)           on each date on which the Pool Balance of the Class A Trust shall have been reduced by payments made to the Class A Certificateholders pursuant to Section 3.2 hereof or pursuant to Section 2.03 of the Escrow and Paying Agent Agreement for such Class, the Subordination
Agent shall withdraw from the Class A Cash Collateral Account such amount as is necessary so that, after giving effect to the reduction of the Pool Balance on such date (and any reduction in the amounts on deposit in the Class A Cash Collateral Account resulting from a prior withdrawal of amounts on deposit in the Class A Cash Collateral Account on such date) and any transfer of Investment Earnings from such Cash Collateral Account to the Collection Account or the Special Payments Account on such date, an amount
equal to the sum of the Required Amount (with respect to the Class A Liquidity Facility) plus (if on a Distribution Date not coinciding with an Interest Payment Date) Investment Earnings on deposit in such Cash Collateral Account (after giving effect to any such transfer of Investment Earnings) will be on deposit in the Class A Cash Collateral Account and shall first, pay such withdrawn amount to the Class A Liquidity Provider until the Liquidity Obligations (with respect to the Class A Certificates) owing to
such Liquidity Provider shall have been paid in full, and second, deposit any remaining withdrawn amount in the Collection Account;

 

(iv)           on each date on which the Pool Balance of the Class B Trust shall have been reduced by payments made to the Class B Certificateholders pursuant to Section 3.2 hereof or pursuant to Section 2.03 of the Escrow and Paying Agent Agreement for such Class, the Subordination
Agent shall withdraw from the Class B Cash Collateral Account such amount as is necessary so that, after giving effect to the reduction of the Pool Balance on such date (and any reduction in the amounts on deposit in the Class B Cash Collateral Account resulting from a prior withdrawal of amounts on deposit in the Class B Cash Collateral Account on such date) and any transfer of Investment Earnings from such Cash Collateral Account to the Collection Account or the Special Payments Account

 

 

34

BACK 

on such date, an amount equal to the sum of the Required Amount (with respect to the Class B Liquidity Facility) plus (if on a Distribution Date not coinciding with an Interest Payment Date) Investment Earnings on deposit in such Cash Collateral Account (after giving effect to any such transfer of Investment Earnings) will be on deposit in
the Class B Cash Collateral Account and shall first, pay such withdrawn amount to the Class B Liquidity Provider until the Liquidity Obligations (with respect to the Class B Certificates) owing to such Liquidity Provider shall have been paid in full, and second, deposit any remaining withdrawn amount in the Collection Account;

 

(v)           if a Replacement Liquidity Facility for any Class of Certificates shall be delivered to the Subordination Agent following the date on which funds have been deposited into the Cash Collateral Account related to the Liquidity Facility for such Class of Certificates, the Subordination
Agent shall withdraw all amounts on deposit in such Cash Collateral Account and shall pay such amounts to the replaced Liquidity Provider until all Liquidity Obligations owed to such Person shall have been paid in full, and shall deposit any remaining amount in the Collection Account; and

 

(vi)           following the payment of Final Distributions with respect to any Class of Certificates, on the date on which the Subordination Agent shall have been notified by the Liquidity Provider for such Class of Certificates that the Liquidity Obligations owed to such Liquidity
Provider have been paid in full, the Subordination Agent shall withdraw all amounts on deposit in the Cash Collateral Account related to the Liquidity Facility in respect of such Class of Certificates and shall deposit such amount in the Collection Account.

 

(g)           Reinstatement.  With respect to any Interest Drawing under the Liquidity Facility for any Trust, upon the reimbursement of the applicable Liquidity Provider for all or any part of the amount of such
Interest Drawing, together with any accrued interest thereon, the Available Amount of such Liquidity Facility shall be reinstated by an amount equal to the amount of such Interest Drawing so reimbursed to the applicable Liquidity Provider but not to exceed the Stated Amount for such Liquidity Facility; provided, however, that such Liquidity Facility shall not be so reinstated in part
or in full at any time if (x) both a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing with respect to the relevant Liquidity Facility or (y) a Final Drawing, a Non-Extension Drawing, a Downgrade Drawing or a Special Termination Drawing shall have occurred with respect to such Liquidity Facility or an Interest Drawing for such Liquidity Facility shall have been converted into a Final Drawing.  In the event that, with respect to any Liquidity Facility,
(i) funds are withdrawn from the related Cash Collateral Account pursuant to clause (i) or (ii) of Section 3.5(f) hereof or (ii) such Liquidity Facility shall become a Downgraded Facility or a Non-Extended Facility at a time when unreimbursed Interest Drawings under such Liquidity Facility have reduced the Available Amount thereunder to zero, then funds received by the Subordination Agent at any time other than (x) any time when a Liquidity Event of Default shall have occurred and be continuing with respect
to such Liquidity Facility and a Performing Note Deficiency exists or (y) any time after a Final Drawing shall have occurred with respect to such Liquidity Facility or an Interest Drawing for such Liquidity Facility shall have been converted into a Final Drawing, shall be deposited in such Cash Collateral Account as and to the extent provided in clause “fourth” of Section 3.2 and applied in accordance with Section 3.5(f) hereof.

 

 

35

BACK 

(h)           Reimbursement.  The amount of each drawing under the Liquidity Facilities shall be due and payable, together with interest thereon, on the dates and at the rates, respectively, provided in the Liquidity
Facilities.

 

(i)           Final Drawing.  Upon receipt from a Liquidity Provider of a Termination Notice with respect to any Liquidity Facility, the Subordination Agent shall, not later than the date specified in such Termination
Notice, in accordance with the terms of such Liquidity Facility, request a drawing under such Liquidity Facility of all available and undrawn amounts thereunder (a “Final Drawing”).  Amounts drawn pursuant to a Final Drawing shall be maintained and invested in accordance with Section 3.5(f) hereof.

 

(j)           Adjustments of Stated Amount.  Promptly following each date on which the Required Amount of the Liquidity Facility for a Class of Certificates is reduced as a result of a reduction in the Pool Balance
with respect to such Certificates or otherwise, the Stated Amount of such Liquidity Facility shall automatically be adjusted to an amount equal to the Required Amount with respect to such Liquidity Facility (as calculated by the Subordination Agent after giving effect to such payment).

 

(k)           Relation to Subordination Provisions.  Interest Drawings under the Liquidity Facilities and withdrawals from the Cash Collateral Accounts relating to such Liquidity Facilities, in each case, in respect
of interest on the Certificates of any Class, will be distributed to the Trustee for such Class of Certificates, notwithstanding Section 3.2 hereof.

 

(l)           Assignment of Liquidity Facility.  The Subordination Agent agrees not to consent to the assignment by any Liquidity Provider of any of its rights or obligations under any Liquidity Facility or any
interest therein, unless (i) Continental shall have consented to such assignment and (ii) each Rating Agency shall have provided a Ratings Confirmation in respect of such assignment; provided, that the Subordination Agent shall consent to such assignment if the conditions in the foregoing clauses (i) and (ii) are satisfied, and the foregoing is not intended to and shall not be construed to limit the rights of the initial Liquidity Provider
under Section 3.5(e)(ii).

 

(m)           Special Termination Drawing.  Upon receipt of a Special Termination Notice with respect to any Liquidity Facility, the Subordination Agent shall, not later than the date specified in such Special
Termination Notice, in accordance with the terms of such Liquidity Facility, request a drawing under such Liquidity Facility of all available and undrawn amounts thereunder (a “Special Termination Drawing”).  Amounts drawn pursuant to a Special Termination Drawing shall be maintained and invested in accordance with Section 3.5(f) hereof.

 

 

ARTICLE IV

 

EXERCISE OF REMEDIES

 

SECTION 4.1.  Directions from the Controlling Party.  (a)  (i)  Following the occurrence and during the continuation of an Indenture Default under any Indenture, the Controlling Party shall direct the Subordination Agent,
as the holder of Equipment Notes issued under such Indenture, which in turn shall direct the Loan Trustee under such Indenture, in the

 

 

36

BACK 

exercise of remedies available to the holder of such Equipment Notes, including, without limitation, the ability to vote all such Equipment Notes held by the Subordination Agent in favor of Accelerating such Equipment Notes in accordance with the provisions of such Indenture.  If the Equipment Notes issued pursuant to any Indenture
and held by the Subordination Agent have been Accelerated following an Indenture Default with respect thereto, the Controlling Party may direct the Subordination Agent to sell, assign, contract to sell or otherwise dispose of and deliver all (but not less than all) of such Equipment Notes to any Person at public or private sale, at any location at the option of the Controlling Party, all upon such terms and conditions as it may reasonably deem advisable in accordance with applicable law.

 

(ii)           Following the occurrence and during the continuation of an Indenture Default under any Indenture, in the exercise of remedies pursuant to such Indenture, the Loan Trustee under such Indenture may be directed to lease the related Aircraft to any Person (including Continental)
so long as the Loan Trustee in doing so acts in a “commercially reasonable” manner within the meaning of Article 9 of the Uniform Commercial Code as in effect in any applicable jurisdiction (including Sections 9-610 and 9-627 thereof).

 

(iii)           Notwithstanding the foregoing, so long as any Certificates remain Outstanding, during the period ending on the date which is nine months after the earlier of (x) the Acceleration of the Equipment Notes issued pursuant to any Indenture and (y) the occurrence of a Continental
Bankruptcy Event, without the consent of each Trustee, no Aircraft subject to the Lien of such Indenture or such Equipment Notes may be sold if the net proceeds from such sale would be less than the Minimum Sale Price for such Aircraft or such Equipment Notes.

 

(iv)           Upon the occurrence and continuation of an Indenture Default under any Indenture, the Subordination Agent will obtain three desktop appraisals from the Appraisers selected by the Controlling Party setting forth the current market value, current lease rate and distressed
value (in each case, as defined by the International Society of Transport Aircraft Trading or any successor organization) of the Aircraft subject to such Indenture (each such appraisal, an “Appraisal” and the current market value appraisals being referred to herein as the “Post-Default Appraisals”). For
so long as any Indenture Default shall be continuing under any Indenture, and without limiting the right of the Controlling Party to request more frequent Appraisals, the Subordination Agent will obtain updated Appraisals on the date that is 364 days from the date of the most recent Appraisal (or if a Continental Bankruptcy Event shall have occurred and is continuing, on the date that is 180 days from the date of the most recent Appraisal).

 

(b)           Following the occurrence and during the continuance of an Indenture Default under any Indenture, the Controlling Party shall take such actions as it may reasonably deem most effectual to complete the sale or other disposition of the relevant Aircraft or Equipment Notes.  In
addition, in lieu of any sale, assignment, contract to sell or other disposition, the Controlling Party may maintain or cause the Subordination Agent to maintain possession of such Equipment Notes and continue to apply monies received in respect of such Equipment Notes in accordance with Article III hereof.  In addition, in lieu of such sale, assignment, contract to sell or other disposition, or in lieu of such maintenance of possession, the Controlling Party may, subject to the terms and conditions
of the related Indenture, instruct the

 

 

37

BACK 

Loan Trustee under such Indenture to foreclose on the Lien on the related Aircraft or to take any other remedial action permitted under such Indenture or under any applicable law.

 

(c)           If following a Continental Bankruptcy Event and during the pendency thereof, the Controlling Party receives a proposal from or on behalf of Continental to restructure the financing of any one or more of the Aircraft, the Controlling Party shall promptly thereafter give the
Subordination Agent and each Trustee notice of the material economic terms and conditions of such restructuring proposal whereupon the Subordination Agent acting on behalf of each Trustee shall endeavor using reasonable commercial efforts to make such terms and conditions of such restructuring proposal available to all Certificateholders (whether by posting on DTC’s Internet board or otherwise).  Thereafter, neither the Subordination Agent nor any Trustee, whether acting on instructions of the
Controlling Party or otherwise, may, without the consent of each Trustee, enter into any term sheet, stipulation or other agreement (whether in the form of an adequate protection stipulation, an extension under Section 1110(b) of the Bankruptcy Code or otherwise) to effect any such restructuring proposal with or on behalf of Continental unless and until the material economic terms and conditions of such restructuring shall have been made available to all Certificateholders for a period of not less than 15 calendar
days (except that such requirement shall not apply to any such term sheet, stipulation or other agreement that is entered into on or prior to the expiry of the 60-Day Period and that is effective for a period not longer than three months from the expiry of the 60-Day Period).  In the event that any Class B Certificateholder or Additional Certificateholder gives irrevocable notice of the exercise of its right to purchase all (but not less than all) of the Class of Certificates represented by the then
Controlling Party pursuant to the applicable Trust Agreement prior to the expiry of the 15-day notice period specified above, such Controlling Party may not direct the Subordination Agent or any Trustee to enter into any such restructuring proposal with respect to any of the Aircraft unless and until such Certificateholder shall fail to purchase such Class of Certificates on the date that it is required to make such purchase.

 

SECTION 4.2.  Remedies Cumulative.  Each and every right, power and remedy given to the Trustees, the Liquidity Providers, the Controlling Party or the Subordination Agent specifically or otherwise in this Agreement shall be cumulative and
shall be in addition to every other right, power and remedy herein specifically given or now or hereafter existing at law, in equity or by statute, and each and every right, power and remedy whether specifically herein given or otherwise existing may, subject always to the terms and conditions hereof, be exercised from time to time and as often and in such order as may be deemed expedient by any Trustee, any Liquidity Provider, the Controlling Party or the Subordination Agent, as appropriate, and the exercise
or the beginning of the exercise of any power or remedy shall not be construed to be a waiver of the right to exercise at the same time or thereafter any other right, power or remedy.  No delay or omission by any Trustee, any Liquidity Provider, the Controlling Party or the Subordination Agent in the exercise of any right, remedy or power or in the pursuit of any remedy shall impair any such right, power or remedy or be construed to be a waiver of any default or to be an acquiescence therein.

 

SECTION 4.3.  Discontinuance of Proceedings.  In case any party to this Agreement (including the Controlling Party in such capacity) shall have instituted any Proceeding to enforce any right, power or remedy under this Agreement by foreclosure,
entry or otherwise, and such Proceeding shall have been discontinued or abandoned for any reason or

 

 

38

BACK 

shall have been determined adversely to the Person instituting such Proceeding, then and in every such case each such party shall, subject to any determination in such Proceeding, be restored to its former position and rights hereunder, and all rights, remedies and powers of such party shall continue as if no such Proceeding had been instituted.

 

SECTION 4.4.  Right of Certificateholders and the Liquidity Providers to Receive Payments Not to Be Impaired.  Anything in this Agreement to the contrary notwithstanding but subject to each Trust Agreement, the right of any Certificateholder
or any Liquidity Provider, respectively, to receive payments hereunder (including without limitation pursuant to Section 3.2 hereof) when due, or to institute suit for the enforcement of any such payment on or after the applicable Distribution Date, shall not be impaired or affected without the consent of such Certificateholder or such Liquidity Provider, respectively.

 

SECTION 4.5.  Undertaking for Costs.  In any Proceeding for the enforcement of any right or remedy under this Agreement or in any Proceeding against any Controlling Party or the Subordination Agent for any action taken or omitted by it as
Controlling Party or Subordination Agent, as the case may be, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  The provisions of this Section do not apply to a suit
instituted by the Subordination Agent, a Liquidity Provider or a Trustee or a suit by Certificateholders holding more than 10% of the original principal amount of any Class of Certificates.

 

 

ARTICLE V

 

DUTIES OF THE SUBORDINATION AGENT;

AGREEMENTS OF TRUSTEES, ETC.

 

SECTION 5.1.  Notice of Indenture Default or Triggering Event.  (a)  In the event the Subordination Agent shall have actual knowledge of the occurrence of an Indenture Default or a Triggering Event, as promptly as practicable,
and in any event within 10 days after obtaining knowledge thereof, the Subordination Agent shall transmit by mail or courier to the Rating Agencies, the Liquidity Providers and the Trustees notice of such Indenture Default or Triggering Event, unless such Indenture Default or Triggering Event shall have been cured or waived.  For all purposes of this Agreement, in the absence of actual knowledge on the part of a Responsible Officer, the Subordination Agent shall not be deemed to have knowledge of any
Indenture Default or Triggering Event unless notified in writing by one or more Trustees, one or more of the Liquidity Providers or one or more Certificateholders.

 

(b)           Other Notices.  The Subordination Agent will furnish to each Liquidity Provider and each Trustee, promptly upon receipt thereof, duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and other instruments furnished to the Subordination Agent as registered holder of the Equipment Notes or otherwise in its capacity as Subordination Agent to the extent the same shall not have been otherwise directly distributed

 

 

39

BACK 

to such Liquidity Provider or Trustee, as applicable, pursuant to the express provision of any other Operative Agreement.

 

(c)           Securities Position.  Upon the occurrence of an Indenture Default, the Subordination Agent shall instruct the Trustees to, and the Trustees shall, request that DTC post on its Internet bulletin board
a securities position listing setting forth the names of all the parties reflected on DTC’s books as holding interests in the Certificates.

 

(d)           Reports.  Promptly after the occurrence of a Triggering Event or an Indenture Default resulting from the failure of Continental to make payments on any Equipment Note and on every Regular Distribution
Date while the Triggering Event or such Indenture Default shall be continuing, the Subordination Agent will provide to the Trustee, the Liquidity Providers, the Rating Agencies and Continental a statement setting forth the following information:

 

(i)           after a Continental Bankruptcy Event, with respect to each Aircraft, whether such Aircraft is (A) subject to the 60-day period of Section 1110(a)(2)(A) of the Bankruptcy Code, (B) subject to an election
by Continental under Section 1110(a) of the Bankruptcy Code, (C) covered by an agreement contemplated by Section 1110(b) of the Bankruptcy Code or (D) not subject to any of (A), (B) or (C);

 

(ii)           to the best of the Subordination Agent’s knowledge, after requesting such information from Continental, (A) whether the Aircraft are currently in service or parked in storage, (B) the maintenance status of
the Aircraft and (C) the location of the Engines (as defined in the Indentures);

 

(iii)           the current Pool Balance of the Certificates, the Preferred B Pool Balance and the outstanding principal amount of all Equipment Notes;

 

(iv)           the expected amount of interest which will have accrued on the Equipment Notes and on the Certificates as of the next Regular Distribution Date;

 

(v)           the amounts paid to each Person on such Distribution Date pursuant to this Agreement;

 

(vi)           details of the amounts paid on such Distribution Date identified by reference to the relevant provision of this Agreement and the source of payment (by Aircraft and party);

 

(vii)           if the Subordination Agent has made a Final Drawing under any Liquidity Facility;

 

(viii)           the amounts currently owed to each Liquidity Provider;

 

(ix)           the amounts drawn under each Liquidity Facility; and

 

 

40

BACK 

(x)           after a Continental Bankruptcy Event, any operational reports filed by Continental with the bankruptcy court which are available to the Subordination Agent on a non-confidential basis.

 

SECTION 5.2.  Indemnification.  The Subordination Agent shall not be required to take any action or refrain from taking any action under Section 5.1 (other than the first sentence thereof) or Article IV hereof unless the Subordination Agent
shall have been indemnified (to the extent and in the manner reasonably satisfactory to the Subordination Agent) against any liability, cost or expense (including counsel fees and expenses) which may be incurred in connection therewith.  The Subordination Agent shall not be under any obligation to take any action under this Agreement and nothing contained in this Agreement shall require the Subordination Agent to expend or risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.  The Subordination Agent shall not be required to take any action under Section 5.1 (other than the first sentence thereof) or Article IV hereof, nor shall any other provision of this Agreement be deemed to impose a duty on the Subordination Agent to take any
action, if the Subordination Agent shall have been advised by counsel that such action is contrary to the terms hereof or is otherwise contrary to law.

 

SECTION 5.3.  No Duties Except as Specified in this Intercreditor Agreement.  The Subordination Agent shall not have any duty or obligation to take or refrain from taking any action under, or in connection with, this Agreement, except as
expressly provided by the terms of this Agreement; and no implied duties or obligations shall be read into this Agreement against the Subordination Agent.  The Subordination Agent agrees that it will, in its individual capacity and at its own cost and expense (but without any right of indemnity in respect of any such cost or expense under Section 5.2 or 7.1 hereof) promptly take such action as may be necessary to duly discharge all Liens on any of the Trust Accounts or any monies deposited therein which
result from claims against it in its individual capacity not related to its activities hereunder or any other Operative Agreement.

 

SECTION 5.4.  Notice from the Liquidity Providers and Trustees.  If any Liquidity Provider or Trustee has notice of an Indenture Default or a Triggering Event, such Person shall promptly give notice thereof to each other party hereto, provided, however,
that no such Person shall have any liability hereunder as a result of its failure to deliver any such notice.

 

 

ARTICLE VI

 

THE SUBORDINATION AGENT

 

SECTION 6.1.  Authorization; Acceptance of Trusts and Duties.  Each of the Class A Trustee and the Class B Trustee hereby designates and appoints the Subordination Agent as the agent and trustee of such Trustee under the applicable Liquidity
Facility and authorizes the Subordination Agent to enter into the applicable Liquidity Facility as agent and trustee for such Trustee.  Each of the Liquidity Providers and the Trustees hereby designates and appoints the

 

 

41

BACK 

Subordination Agent as the Subordination Agent under this Agreement.  WTC hereby accepts the duties hereby created and applicable to it as the Subordination Agent and agrees to perform the same but only upon the terms of this Agreement and agrees to receive and disburse all monies received by it in accordance with the terms hereof.  The
Subordination Agent shall not be answerable or accountable under any circumstances, except (a) for its own willful misconduct or gross negligence (or ordinary negligence in the handling of funds), (b) as provided in Sections 2.2 or 5.3 hereof and (c) for liabilities that may result from the material inaccuracy of any representation or warranty of the Subordination Agent made in its individual capacity in any Operative Agreement.  The Subordination Agent shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Subordination Agent, unless it is proved that the Subordination Agent was negligent in ascertaining the pertinent facts.

 

SECTION 6.2.  Absence of Duties.  The Subordination Agent shall have no duty to see to any recording or filing of this Agreement or any other document, or to see to the maintenance of any such recording or filing.

 

SECTION 6.3.  No Representations or Warranties as to Documents.  The Subordination Agent in its individual capacity does not make nor shall be deemed to have made any representation or warranty as to the validity, legality or enforceability
of this Agreement or any other Operative Agreement or as to the correctness of any statement contained in any thereof, except for the representations and warranties of the Subordination Agent, made in its individual capacity, under any Operative Agreement to which it is a party.  The Certificateholders, the Trustees and the Liquidity Providers make no representation or warranty hereunder whatsoever.

 

SECTION 6.4.  No Segregation of Monies; No Interest.  Any monies paid to or retained by the Subordination Agent pursuant to any provision hereof and not then required to be distributed to any Trustee or any Liquidity Provider as provided
in Articles II and III hereof or deposited into one or more Trust Accounts need not be segregated in any manner except to the extent required by such Articles II and III and by law, and the Subordination Agent shall not (except as otherwise provided in Section 2.2 hereof) be liable for any interest thereon; provided, however, that any payments received or applied hereunder by the Subordination
Agent shall be accounted for by the Subordination Agent so that any portion thereof paid or applied pursuant hereto shall be identifiable as to the source thereof.

 

SECTION 6.5.  Reliance; Agents; Advice of Counsel.  The Subordination Agent shall not incur liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or
other document or paper believed by it to be genuine and believed by it to be signed by the proper party or parties.  As to the Pool Balance of any Trust as of any date, the Subordination Agent may for all purposes hereof rely on a certificate signed by any Responsible Officer of the applicable Trustee, and such certificate shall constitute full protection to the Subordination Agent for any action taken or omitted to be taken by it in good faith in reliance thereon.  As to any fact or matter
relating to the Liquidity Providers or the Trustees the manner of ascertainment of which is not specifically described herein, the Subordination Agent may for all purposes hereof rely on a certificate, signed by any Responsible Officer of the applicable Liquidity Provider or Trustee, as the case may be, as to such fact or matter, and such certificate shall constitute full protection to the Subordination

 

 

42

BACK 

Agent for any action taken or omitted to be taken by it in good faith in reliance thereon.  The Subordination Agent shall assume, and shall be fully protected in assuming, that each of the Liquidity Providers and each of the Trustees are authorized to enter into this Agreement and to take all action to be taken by them pursuant to
the provisions hereof, and shall not inquire into the authorization of the Liquidity Providers and the Trustees with respect thereto.  In the administration of the trusts hereunder, the Subordination Agent may execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents or attorneys and may consult with counsel, accountants and other skilled persons to be selected and retained by it, and the Subordination Agent shall not be liable for the acts or
omissions of any agent appointed with due care or for anything done, suffered or omitted in good faith by it in accordance with the advice or written opinion of any such counsel, accountants or other skilled persons.

 

SECTION 6.6.  Capacity in Which Acting.  The Subordination Agent acts hereunder solely as agent and trustee herein and not in its individual capacity, except as otherwise expressly provided in the Operative Agreements.

 

SECTION 6.7.  Compensation.  The Subordination Agent shall be entitled to reasonable compensation, including expenses and disbursements, for all services rendered hereunder and shall have a priority claim to the extent set forth in Article
III hereof on all monies collected hereunder for the payment of such compensation, to the extent that such compensation shall not be paid by others.  The Subordination Agent agrees that it shall have no right against any Trustee or Liquidity Provider for any fee as compensation for its services as agent under this Agreement.  The provisions of this Section 6.7 shall survive the termination of this Agreement.

 

SECTION 6.8.  May Become Certificateholder.  The institution acting as Subordination Agent hereunder may become a Certificateholder and have all rights and benefits of a Certificateholder to the same extent as if it were not the institution
acting as the Subordination Agent.

 

SECTION 6.9.  Subordination Agent Required; Eligibility.  There shall at all times be a Subordination Agent hereunder which shall be a corporation organized and doing business under the laws of the United States of America or of any State
or the District of Columbia having a combined capital and surplus of at least $100,000,000 (or the obligations of which, whether now in existence or hereafter incurred, are fully and unconditionally guaranteed by a corporation organized and doing business under the laws of the United States of America, any State thereof or of the District of Columbia and having a combined capital and surplus of at least $100,000,000), if there is such an institution willing and able to perform the duties of the Subordination
Agent hereunder upon reasonable or customary terms.  Such corporation shall be a citizen of the United States and shall be authorized under the laws of the United States or any State thereof or of the District of Columbia to exercise corporate trust powers and shall be subject to supervision or examination by federal, state or District of Columbia authorities.  If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of any of the aforesaid
supervising or examining authorities, then, for the purposes of this Section 6.9, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.

 

 

43

BACK 

In case at any time the Subordination Agent shall cease to be eligible in accordance with the provisions of this Section, the Subordination Agent shall resign immediately in the manner and with the effect specified in Section 8.1.

 

SECTION 6.10.  Money to Be Held in Trust.  All Equipment Notes, monies and other property deposited with or held by the Subordination Agent pursuant to this Agreement shall be held in trust for the benefit of the parties entitled to such
Equipment Notes, monies and other property.  All such Equipment Notes, monies or other property shall be held in the Trust Department of the institution acting as Subordination Agent hereunder.

 

 

ARTICLE VII

 

INDEMNIFICATION OF SUBORDINATION AGENT

 

SECTION 7.1.  Scope of Indemnification.  The Subordination Agent shall be indemnified hereunder to the extent and in the manner described in Section 8.1 of the Participation Agreements and Section 6 of the Note Purchase Agreement.  The
indemnities contained in such Sections of such agreements shall survive the termination of this Agreement.

 

 

ARTICLE VIII

 

SUCCESSOR SUBORDINATION AGENT

 

SECTION 8.1.  Replacement of Subordination Agent; Appointment of Successor.  The Subordination Agent may resign at any time by so notifying each other party hereto.  The Controlling Party may remove the Subordination Agent for
cause by so notifying the Subordination Agent and may appoint a successor Subordination Agent.  The Controlling Party shall remove the Subordination Agent if:

 

(1)           the Subordination Agent fails to comply with Section 6.9 hereof;

 

(2)           the Subordination Agent is adjudged bankrupt or insolvent;

 

(3)           a receiver or other public officer takes charge of the Subordination Agent or its property; or

 

(4)           the Subordination Agent otherwise becomes incapable of acting.

 

If the Subordination Agent resigns or is removed or if a vacancy exists in the office of Subordination Agent for any reason (the Subordination Agent in such event being referred to herein as the retiring Subordination Agent), the Controlling Party shall promptly appoint a successor Subordination Agent.

 

A successor Subordination Agent shall deliver (x) a written acceptance of its appointment as Subordination Agent hereunder to the retiring Subordination Agent and (y) a written assumption of its obligations hereunder and under each Liquidity Facility to each party

 

 

44

BACK 

hereto, upon which the resignation or removal of the retiring Subordination Agent shall become effective, and the successor Subordination Agent shall have all the rights, powers and duties of the Subordination Agent under this Agreement.  The successor Subordination Agent shall mail a notice of its succession to each other party
hereto.  The retiring Subordination Agent shall promptly transfer its rights under each of the Liquidity Facilities and all of the property held by it as Subordination Agent to the successor Subordination Agent.

 

If a successor Subordination Agent does not take office within 60 days after the retiring Subordination Agent resigns or is removed, the retiring Subordination Agent or one of more of the Trustees may petition any court of competent jurisdiction for the appointment of a successor Subordination Agent.

 

If the Subordination Agent fails to comply with Section 6.9 hereof (to the extent applicable), one or more of the Trustees or one or more of the Liquidity Providers may petition any court of competent jurisdiction for the removal of the Subordination Agent and the appointment of a successor Subordination Agent.

 

Notwithstanding the foregoing, no resignation or removal of the Subordination Agent shall be effective unless and until a successor has been appointed.  No appointment of a successor Subordination Agent shall be effective unless and until the Rating Agencies shall have delivered a Ratings Confirmation.

 

 

ARTICLE IX

 

SUPPLEMENTS AND AMENDMENTS

 

SECTION 9.1.  Amendments, Waivers, Possible Future Issuance of an Additional Class of Certificates, etc.  (a)  This Agreement may not be supplemented, amended or modified without the consent of each Trustee (acting, except in the
case of any amendment pursuant to Section 3.5(e)(v)(y) hereof with respect to any Replacement Liquidity Facility or any amendment contemplated by the last sentence of this Section 9.1(a), with the consent of holders of Certificates of the related Class evidencing interests in the related Trust aggregating not less than a majority in interest in such Trust or as otherwise authorized pursuant to the relevant Trust Agreement), the Subordination Agent and each Liquidity Provider; provided, however,
that this Agreement may be supplemented, amended or modified without the consent of any Trustee if such supplement, amendment or modification (i) is in accordance with Section 9.1(c) or Section 9.1(d) hereof or (ii) cures an ambiguity or inconsistency or does not materially adversely affect such Trustee or the holders of the related Class of Certificates; provided further, however,
that, if such supplement, amendment or modification (A) would (x) directly or indirectly modify or supersede, or otherwise conflict with, Section 2.2(b), Section 3.5(e), Section 3.5(f)(other than the last sentence thereof), Section 3.5(l), the last sentence of this Section 9.1(a), Section 9.1(c), Section 9.1(d), the second sentence of Section 10.6 or this proviso (collectively, the “Continental Provisions”) or (y) otherwise adversely
affect the interests of a potential Replacement Liquidity Provider or of Continental with respect to its ability to replace any Liquidity Facility or with respect to its payment obligations under any Operative Agreement or (B) is made pursuant to the last sentence of this Section 9.1(a) or pursuant to Section 9.1(c) or Section 9.1(d), then such

 

 

45

BACK 

supplement, amendment or modification shall not be effective without the additional written consent of Continental.  Notwithstanding the foregoing, without the consent of each Certificateholder and each Liquidity Provider, no supplement, amendment or modification of this Agreement may (i) reduce the percentage of the interest in
any Trust evidenced by the Certificates issued by such Trust necessary to consent to modify or amend any provision of this Agreement or to waive compliance therewith or (ii) except as provided in this Section 9.1(a), Section 9.1(c) or Section 9.1(d), modify Section 2.4 or 3.2 hereof, relating to the distribution of monies received by the Subordination Agent hereunder from the Equipment Notes or pursuant to the Liquidity Facilities.  Nothing contained in this Section shall require the consent of a Trustee
at any time following the payment of Final Distributions with respect to the related Class of Certificates.  If the Replacement Liquidity Facility for any Liquidity Facility in accordance with Section 3.5(e) hereof is to be comprised of more than one instrument as contemplated by the definition of the term “Replacement Liquidity Facility”, then each of the parties hereto agrees to amend this Agreement to incorporate appropriate mechanics for multiple Liquidity Facilities for an individual
Trust.

 

(b)           In the event that the Subordination Agent, as the registered holder of any Equipment Notes, receives a request for the giving of any notice or for its consent to any amendment, supplement, modification, consent or waiver under such Equipment Notes, the Indenture pursuant
to which such Equipment Notes were issued, or the related Participation Agreement or other related document, (i) if no Indenture Default shall have occurred and be continuing with respect to such Indenture, the Subordination Agent shall request directions with respect to each Series of such Equipment Notes from the Trustee of the Trust which holds such Equipment Notes and shall vote or consent in accordance with the directions of such Trustee, and (ii) if any Indenture Default shall have occurred and be continuing
with respect to such Indenture, the Subordination Agent will exercise its voting rights with respect to such Equipment Notes as directed by the Controlling Party (subject to Sections 4.1 and 4.4 hereof); provided that no such amendment, modification or waiver shall, without the consent of each affected Certificateholder and each Liquidity Provider, reduce the amount of principal or interest payable by Continental under any Equipment Note or change
the time of payments or method of calculation of any amount under any Equipment Note.

 

(c)           If Series B Equipment Notes issued with respect to all of the Aircraft are redeemed and re-issued in accordance with the terms of Section 2.11(b) of each Indenture and Section 4(a)(vi) of the Note Purchase Agreement, such series of re-issued Equipment Notes (the “Refinancing
Equipment Notes”) shall be issued to a new pass through trust (a “Refinancing Trust”) that issues a class of pass through certificates (the “Refinancing Certificates”) to certificateholders (the “Refinancing Certificateholders”) pursuant to a pass through trust agreement
(a “Refinancing Trust Agreement”) with a trustee (a “Refinancing Trustee”).  A Refinancing Trust, a Refinancing Trustee and the Refinancing Certificates shall be subject to all of the provisions of this Agreement in the same manner as the Class B Trust, the Class B Trustee and the Class B Certificates, including the subordination of the Refinancing
Certificates to the Administration Expenses, the Liquidity Obligations and the Class A Certificates.  Such issuance of Refinancing Equipment Notes and Refinancing Certificates and the amendment of this Agreement as provided below shall require Ratings Confirmation and shall not materially adversely affect any of the Trustees.  This Agreement shall be amended by written agreement of

 

 

46

BACK 

Continental and the Subordination Agent to give effect to the issuance of the Refinancing Certificates subject to the following terms and conditions:

 

(i)           the Refinancing Trustee shall be added as a party to this Agreement;

 

(ii)           the definitions of “Certificate”, “Class”, “Class B Certificates”, “Final Legal Distribution Date”, “Trust”, “Trust Agreement” and “Controlling Party” (and such other applicable definitions)
shall be revised, as appropriate, to reflect such issuance (and the subordination of the Refinancing Certificates and the Refinancing Equipment Notes);

 

(iii)           the Refinancing Certificates may have the benefit of credit support similar to the Class B Liquidity Facility, and claims for fees, interest, expenses, reimbursement of advances and other obligations arising from such credit support may rank pari passu with similar claims
in respect of the Class A Liquidity Facility so long as a Ratings Confirmation and the prior written consent of the Class A Liquidity Provider shall have been obtained;

 

(iv)           the Refinancing Certificates cannot be issued to Continental but may be issued to any of Continental’s Affiliates so long as such Affiliate shall have bankruptcy remote and special purpose provisions in its certificate of incorporation or other organizational documents
and any subsequent transfer of the Refinancing Certificates to any Affiliate of Continental shall be similarly restricted; and

 

(v)           the scheduled payment dates on the Refinancing Equipment Notes shall be on the Regular Distribution Dates.

 

The issuance of the Refinancing Certificates in compliance with all of the foregoing terms of this Section 9.1(c) shall not require the consent of any of the Trustees or the holders of any Class of Certificates.  Each of the Liquidity Providers hereby agrees and confirms that it shall
be deemed to consent to any issuance and amendment in accordance with this Section 9.1(c) (subject to the Class A Liquidity Provider’s consent right in Section 9.1(c)(iii)) and any such issuance and amendment shall not affect any of its respective obligations under the Liquidity Facilities.

 

(d)           Pursuant to the terms of Section 2.02 of each Indenture and Section 4(a)(vi) of the Note Purchase Agreement, a single additional series of Equipment Notes (the “Additional Equipment Notes”), which
shall be subordinated in right of payment to the Series A Equipment Notes and the Series B Equipment Notes under such Indenture, may be issued at any time after the Delivery Period Expiry Date.  If Additional Equipment Notes are issued under one or more of the Indentures, such Additional Equipment Notes shall be issued to a new pass through trust (an “Additional Trust”) that issues a class of pass through certificates (the
“Additional Certificates”) to certificateholders (the “Additional Certificateholders”) pursuant to a pass through trust agreement (an “Additional Trust Agreement”) with a trustee (an “Additional Trustee”).  In
such case, this Agreement shall be amended by written agreement of Continental and the Subordination Agent to provide for the subordination of the Additional Certificates to the Administration Expenses, the Liquidity Obligations, the Class A Certificates and the Class B Certificates (subject to clause (iii) below).  Such issuance and the amendment of this Agreement

 

 

47

BACK 

as provided below shall require Ratings Confirmation and shall not materially adversely affect any of the Trustees.  This Agreement shall be amended by written agreement of Continental and the Subordination Agent to give effect to the issuance of any Additional Certificates subject to the following terms and conditions:

 

(i)           the Additional Trustee shall be added as a party to this Agreement;

 

(ii)           the definitions of “Certificate”, “Class”, “Equipment Notes”, “Final Legal Distribution Date”, “Trust”, “Trust Agreement” and “Controlling Party” (and such other applicable definitions)
shall be revised, as appropriate, to reflect the issuance of the Additional Certificates (and the subordination thereof);

 

(iii)           Section 3.2 may be revised to provide for the distribution of “Adjusted Interest” for the Additional Certificates (calculated in a manner substantially similar to the calculation of Class B Adjusted Interest) after the Class B Adjusted Interest but before Expected
Distributions on the Class A Certificates;

 

(iv)           the Additional Certificates shall not have the benefit of any credit support similar to the Liquidity Facilities;

 

(v)           the Additional Certificates cannot be issued to Continental but may be issued to any of Continental’s Affiliates so long as such Affiliate shall have bankruptcy remote and special purpose provisions in its certificate of incorporation or other organizational documents
and any subsequent transfer of the Additional Certificates to any Affiliate of Continental shall be similarly restricted;

 

(vi)           the provisions of this Agreement governing payments with respect to Certificates and related notices, including Sections 2.4, 3.1 and 3.2, shall be revised to provide for distributions on the Additional Certificates after payment of Administration Expenses, the Liquidity
Obligations, the Class A Certificates and the Class B Certificates, subject to clause (iii) above; and

 

(vii)           the scheduled payment dates on such series of Additional Equipment Notes shall be on the Regular Distribution Dates.

 

The issuance of the Additional Certificates in compliance with all of the foregoing terms of this Section 9.1(d) shall not require the consent of any of the Trustees or the holders of any Class of Certificates.  Each of the Liquidity Providers hereby agrees and confirms that it shall be deemed to consent to any issuance and amendment
in accordance with this Section 9.1(d) and any such issuance and amendment shall not affect any of its respective obligations under the Liquidity Facilities.

 

SECTION 9.2.  Subordination Agent Protected.  If, in the reasonable opinion of the institution acting as the Subordination Agent hereunder, any document required to be executed pursuant to the terms of Section 9.1 affects any right, duty,
immunity or indemnity with respect to it under this Agreement or any Liquidity Facility, the Subordination Agent may in its discretion decline to execute such document.

 

 

48

BACK 

SECTION 9.3.  Effect of Supplemental Agreements.  Upon the execution of any amendment, consent or supplement hereto pursuant to the provisions hereof, this Agreement shall be and be deemed to be and shall be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Agreement of the parties hereto and beneficiaries hereof shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental agreement shall be and be deemed to be and shall be part of the terms and conditions of this Agreement for any and all purposes.  In executing or accepting
any supplemental agreement permitted by this Article IX, the Subordination Agent shall be entitled to receive, and shall be fully protected in relying upon, an opinion of counsel stating that the execution of such supplemental agreement is authorized or permitted by this Agreement.

 

SECTION 9.4.  Notice to Rating Agencies.  Promptly upon receipt of any amendment, consent, modification, supplement or waiver contemplated by this Article IX and prior to taking any action required to be taken thereunder, the Subordination
Agent shall send a copy thereof to each Rating Agency.

 

 

ARTICLE X

 

MISCELLANEOUS

 

SECTION 10.1.  Termination of Intercreditor Agreement.  Following payment of Final Distributions with respect to each Class of Certificates and the payment in full of all Liquidity Obligations to the Liquidity Providers and provided that
there shall then be no other amounts due to the Certificateholders, the Trustees, the Liquidity Providers and the Subordination Agent hereunder or under the Trust Agreements, and that the commitment of the Liquidity Providers under the Liquidity Facilities shall have expired or been terminated, this Agreement and the trusts created hereby shall terminate and this Agreement shall be of no further force or effect.  Except as aforesaid or otherwise provided, this Agreement and the trusts created hereby
shall continue in full force and effect in accordance with the terms hereof.

 

SECTION 10.2.  Intercreditor Agreement for Benefit of Trustees, Liquidity Providers and Subordination Agent.  Subject to the second sentence of Section 10.6 and the provisions of Sections 4.4 and 9.1, nothing in this Agreement, whether
express or implied, shall be construed to give to any Person other than the Trustees, the Liquidity Providers and the Subordination Agent any legal or equitable right, remedy or claim under or in respect of this Agreement.

 

SECTION 10.3.  Notices.  Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents provided or permitted by this Agreement to be made,
given, furnished or filed shall be in writing, mailed by certified mail, postage prepaid, or by confirmed telecopy and

 

 

49

BACK 

(i)           if to the Subordination Agent, addressed to at its office at:

 

WILMINGTON TRUST COMPANY

One Rodney Square

1100 N. Market Street

Wilmington, DE 19890-1605

Attention:  Corporate Capital Market Services

Telecopy:  (302) 636-4140

 

(ii)          if to any Trustee, addressed to it at its office at:

 

WILMINGTON TRUST COMPANY

One Rodney Square

1100 N. Market Street

Wilmington, DE 19890-1605

Attention:  Corporate Capital Market Services

Telecopy:  (302) 636-4140

 

(iii)         if to the Liquidity Provider, addressed to it at its office at:

 

Natixis S.A, New York Branch

9 West 57th Street, 35th Floor

New York, NY 10019

Attention:  Lily Cheung

Telecopy:  (212) 891-1900

Telephone:  (212) 891-1948

Email:  CAL2009_2_Report@us.natixis.com

with a copy to:

Natixis S.A, New York Branch

1251 Avenue of the Americas

New York, NY 10020

Attention:  Martha Sealy

Telecopy:  (347) 402-3031

Telephone:  (212) 872-5031

 

Whenever any notice in writing is required to be given by any Trustee, any Liquidity Provider or the Subordination Agent to any of the other of them, such notice shall be deemed given and such requirement satisfied when such notice is received.  Any party hereto may change the address to which notices to such party will be sent by
giving notice of such change to the other parties to this Agreement.

 

SECTION 10.4.  Severability.  Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating
the remaining provisions

 

 

50

BACK 

hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

SECTION 10.5.  No Oral Modifications or Continuing Waivers.  No terms or provisions of this Agreement may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by the party or other Person against
whom enforcement of the change, waiver, discharge or termination is sought and any other party or other Person whose consent is required pursuant to this Agreement and any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given.

 

SECTION 10.6.  Successors and Assigns.  All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, each of the parties hereto and the successors and assigns of each, all as herein provided.  In
addition, the Continental Provisions shall inure to the benefit of Continental and its successors and assigns, and (without limitation of the foregoing) Continental is hereby constituted, and agreed to be, an express third party beneficiary of the Continental Provisions.  Upon the occurrence of the Transfers contemplated by the Assignment and Assumption Agreements, (i) the Trustee of the Original Class A Trust shall (without any further act) be deemed to have transferred all of its rights, title and
interest in and to this Agreement to the trustee of the Successor Class A Trust and, thereafter, the trustee of the Successor Class A Trust shall be deemed to be the “Trustee” of the Successor Class A Trust with the rights and obligations of the “Trustee” hereunder and under the other Operative Agreements and each reference to the Class A Trust herein shall be deemed a reference to the Successor Class A Trust and (ii) the Trustee of the Original Class B Trust shall (without any further
act) be deemed to have transferred all of its rights, title and interest in and to this Agreement to the trustee of the Successor Class B Trust and, thereafter, the trustee of the Successor Class B Trust shall be deemed to be the “Trustee” of the Successor Class B Trust with the rights and obligations of the “Trustee” hereunder and under the other Operative Agreements and each reference to the Class B Trust herein shall be deemed a reference to the Successor Class B Trust.

 

SECTION 10.7.  Headings.  The headings of the various Articles and Sections herein and in the table of contents hereto are for convenience of reference only and shall not define or limit any of the terms or provisions hereof.

 

SECTION 10.8.  Counterpart Form.  This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but
one and the same agreement.

 

SECTION 10.9.  Subordination.  (a)  As between the Liquidity Providers (and any additional liquidity provider in respect of any Refinancing Certificates), on the one hand, and the Trustees (and any Refinancing Trustees or Additional
Trustee) and the Certificateholders (and any Refinancing Certificateholders or Additional Certificateholders), on the other hand, and as among the Trustees (and any Refinancing Trustees or Additional Trustee) and the related Certificateholders (and any Refinancing Certificateholders or Additional Certificateholders), this Agreement shall be a subordination agreement for purposes of Section 510 of the United States Bankruptcy Code, as amended from time to time.

 

 

51

BACK 

(b)           Notwithstanding the provisions of this Agreement, if prior to the payment in full to the Liquidity Providers of all Liquidity Obligations then due and payable, any party hereto shall have received any payment or distribution in respect of Equipment Notes or any other amount
under the Indentures or other Operative Agreements which, had the subordination provisions of this Agreement been properly applied to such payment, distribution or other amount, would not have been distributed to such Person, then such payment, distribution or other amount shall be received and held in trust by such Person and paid over or delivered to the Subordination Agent for application as provided herein.

 

(c)           If any Trustee, any Liquidity Provider or the Subordination Agent receives any payment in respect of any obligations owing hereunder (or, in the case of the Liquidity Providers, in respect of the Liquidity Obligations), which is subsequently invalidated, declared preferential,
set aside and/or required to be repaid to a trustee, receiver or other party, then, to the extent of such payment, such obligations (or, in the case of the Liquidity Providers, such Liquidity Obligations) intended to be satisfied shall be revived and continue in full force and effect as if such payment had not been received.

 

(d)           The Trustees (on behalf of themselves and the holders of the Certificates), the Liquidity Providers and the Subordination Agent confirm that the payment priorities specified in Section 3.2 shall apply in all circumstances, notwithstanding the fact that the obligations owed
to the Trustees and the holders of Certificates are secured by certain assets and the Liquidity Obligations may not be so secured.  The Trustees expressly agree (on behalf of themselves and the holders of the Certificates) not to assert priority over the holders of Liquidity Obligations (except as specifically set forth in Section 3.2) due to their status as secured creditors in any bankruptcy, insolvency or other legal proceeding.

 

(e)           The Trustees (on behalf of themselves and the holders of the Certificates), the Liquidity Providers and the Subordination Agent may take any of the following actions without impairing its rights under this Agreement:

 

(i)           obtain a Lien on any property to secure any amounts owing to it hereunder, including, in the case of the Liquidity Providers, the Liquidity Obligations,

 

(ii)           obtain the primary or secondary obligation of any other obligor with respect to any amounts owing to it hereunder, including, in the case of the Liquidity Providers, any of the Liquidity Obligations,

 

(iii)           renew, extend, increase, alter or exchange any amounts owing to it hereunder, including, in the case of the Liquidity Providers, any of the Liquidity Obligations, or release or compromise any obligation of any obligor with respect thereto,

 

(iv)           refrain from exercising any right or remedy, or delay in exercising such right or remedy, which it may have, or

 

(v)           take any other action which might discharge a subordinated party or a surety under applicable law;

 

 

52

BACK 

provided, however, that the taking of any such actions by any of the Trustees, the Liquidity Providers or the Subordination Agent shall not prejudice the rights or adversely affect the obligations of any other party
under this Agreement.

 

SECTION 10.10.  Governing Law.  THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.

 

SECTION 10.11.  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 10.3 hereof,
or at such other address of which the other parties 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)           EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS 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.  Each of the parties warrants and represents 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.

 

 

53

BACK 

(c)           To the extent that any Liquidity Provider or any of the properties of any Liquidity Provider has or may hereafter acquire any right of immunity, whether characterized as sovereign immunity or otherwise, and whether under the United States Foreign Sovereign Immunities Act
of 1976 (or any successor legislation) or otherwise, from any legal proceedings, whether in the United States or elsewhere, to enforce or collect upon this Agreement, including, without limitation, immunity from suit or service of process, immunity from jurisdiction or judgment of any court or tribunal or execution of a judgment, or immunity of any of its property from attachment prior to any entry of judgment, or from attachment in aid of execution upon a judgment, such Liquidity Provider hereby irrevocably
and expressly waives any such immunity, and agrees not to assert any such right or claim in any such proceeding, whether in the United States or elsewhere.

 

 

54

BACK 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers thereunto duly authorized, as of the day and year first above written, and acknowledge that this Agreement has been made and delivered in the City of New York, and this Agreement has become effective only upon such execution
and delivery.

 

	  	
WILMINGTON TRUST COMPANY,

not in its individual capacity but solely as

Trustee for each of the Trusts

	  	  
	  	  
	  	
By:
	  
	  	
Name:
	  
	  	
Title:
	  

	  	
NATIXIS S.A., ACTING THROUGH ITS NEW

YORK BRANCH, as Class A Liquidity Provider

and Class B Liquidity Provider

	  	  
	  	  
	  	
By:
	  
	  	
Name:
	  
	  	
Title:
	  
	  	  
	  	  
	  	
By:
	  
	  	
Name:
	  
	  	
Title:
	  

	  	
WILMINGTON TRUST COMPANY,

not in its individual capacity except as expressly

set forth herein but solely as Subordination

Agent and trustee

	  	  
	  	  
	  	
By:
	  
	  	
Name:
	  
	  	
Title:
	  

 

 

 

Intercreditor Agreement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00165-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00165-of-00352.parquet"}]]