-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RmUn32xGfNsUjDRvrhd5RGk78J3hqHse4V7gd0SQc4TDTwu4on5q485P/xW8jvNt fPyiG+NokzXQT98utPg6lg== 0000914121-04-001010.txt : 20040519 0000914121-04-001010.hdr.sgml : 20040519 20040519114836 ACCESSION NUMBER: 0000914121-04-001010 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 20020430 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040519 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DELTA AIR LINES INC /DE/ CENTRAL INDEX KEY: 0000027904 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, SCHEDULED [4512] IRS NUMBER: 580218548 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05424 FILM NUMBER: 04817772 BUSINESS ADDRESS: STREET 1: HARTSFIELD ATLANTA INTL AIRPORT STREET 2: 1030 DELTA BLVD CITY: ATLANTA STATE: GA ZIP: 30354-1989 BUSINESS PHONE: 4047152600 MAIL ADDRESS: STREET 1: P.O. BOX 20706 STREET 2: DEPT 981 CITY: ATLANTA STATE: GA ZIP: 30320-6001 FORMER COMPANY: FORMER CONFORMED NAME: DELTA AIR CORP DATE OF NAME CHANGE: 19660908 8-K 1 de763576-8k.txt CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 30, 2002 Delta Air Lines, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 1-5424 58-0218548 - -------------------------------------------------------------------------------- (State of incorporation) (Commission File Number) (I.R.S. Employer Identification No.) Hartsfield-Jackson Atlanta International Airport, Atlanta, Georgia 30320 - -------------------------------------------------------------------------------- (Address of principal executive officers) (Zip Code) Registrant's telephone number, including area code: (404) 715-2600 - -------------------------------------------------------------------------------- Not Applicable - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) ITEM 5. OTHER EVENTS ------------ Delta Air Lines, Inc. (the "Company") is filing with the Securities and Exchange Commission certain items that are to be incorporated by reference into its Registration Statement on Form S-3 (File No. 333-65218). ITEM 7. EXHIBITS -------- The following documents are filed as Exhibits in connection with, and incorporated by reference into, the Company's Registration Statement on Form S-3 (File No. 333-65218). The Registration Statement and the Prospectus Supplement dated April 23, 2002 to the Prospectus date July 23, 2001 related to the offering by the Company of Pass Through Trust Certificates, Series 2002-1. EXHIBIT NUMBER DESCRIPTION - -------------- ----------- 1(a) Underwriting Agreement dated as of April 23, 2002, by and among the Company, Salomon Smith Barney Inc. and J.P. Morgan Securities Inc. 4(a)(1) Trust Supplement No. 2002-1G-1 dated as of April 30, 2002, by and between the Company and State Street Bank and Trust Company of Connecticut, National Association, as Trustee (the "Pass Through Trustee"). 4(a)(2) Form of 6.718% Delta Air Lines Pass Through Certificate, Series 2002-1G-1 (included in Exhibit 4(a)(1)). 4(a)(3) Trust Supplement No. 2002-1G-2 dated as of April 30, 2002, by and between the Company and the Pass Through Trustee. 4(a)(4) Form of 6.417% Delta Air Lines Pass Through Certificate, Series 2002-1G-2 (included in Exhibit 4(a)(3)). 4(a)(5) Trust Supplement No. 2002-1C dated as of April 30, 2002, by and between the Company and the Pass Through Trustee. 4(a)(6) Form of 7.779% Delta Air Lines Pass Through Certificate, Series 2002-1C (included in Exhibit 4(a)(5)). 4(b)(1) Intercreditor Agreement dated as of April 30, 2002, by and among the Pass Through Trustee, Westdeutsche Landesbank Girozentrale, New York Brach (the "Liquidity Provider") and State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent (the "Subordination Agent"). 4(c)(1) Revolving Credit Agreement (2002-1G-1) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(c)(2) Revolving Credit Agreement (2002-1G-2) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(c)(3) Revolving Credit Agreement (2002-1C) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(d)(1) Financial Guarantee Insurance Policy (2002-1G-1) issued by MBIA Insurance Corporation, dated April 30, 2002. 4(d)(2) Financial Guarantee Insurance Policy (2002-1G-2) issued by MBIA Insurance Corporation, dated April 30, 2002. 4(e)(1) Participation Agreement (N372DA) dated as of April 30, 2002, by and among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein. 4(e)(2) Indenture and Security Agreement (N372DA) dated as of April 30, 2002, by and between the Company and the Loan Trustee. 4(e)(3) Form of Series 2002-1 Equipment Notes issued in connection with the Boeing aircraft bearing U.S. registration number N372DA (included in Exhibit 4(e)(2)). 4(e)(4) Participation Agreement (N833MH) dated as of April 30, 2002, by and among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein. 4(e)(5) Indenture and Security Agreement (N833MH) dated as of April 30, 2002, by and between the Company and the Loan Trustee. 4(e)(6) Form of Series 2002-1 Equipment Notes issued in connection with the Boeing aircraft bearing U.S. registration number N833MH (included in Exhibit 4(e)(5)). 99 Schedule I.* *Pursuant to Instruction 2 to Item 601 of Regulation S-K, Exhibit 99(a) filed herewith contains a list of other documents applicable to the Boeing aircraft that relate to the offering of the Company's Pass Through Certificates, Series 2002-1, which documents are substantially identical to those applicable to the Boeing 737 aircraft bearing United States registration numbers. Exhibit 99 sets forth the details by which such other documents differ from the corresponding documents filed in respect of the aircraft bearing United States registrations number N372DA. The Exhibit Index commencing on page 6 is hereby incorporated herein by reference. Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DELTA AIR LINES, INC. Date: May 19, 2004 By: /s/ Leslie P. Klemperer ------------------------ ------------------------------------- Leslie P. Klemperer Vice President - Deputy General Counsel & Secretary EXHIBIT INDEX ------------- EXHIBIT NUMBER DESCRIPTION - -------------- ----------- 1(a) Underwriting Agreement dated as of April 23, 2002, by and among the Company, Salomon Smith Barney Inc. and J.P. Morgan Securities Inc. 4(a)(1) Trust Supplement No. 2002-1G-1 dated as of April 30, 2002, by and between the Company and State Street Bank and Trust Company of Connecticut, National Association, as Trustee (the "Pass Through Trustee"). 4(a)(2) Form of 6.718% Delta Air Lines Pass Through Certificate, Series 2002-1G-1 (included in Exhibit 4(a)(1)). 4(a)(3) Trust Supplement No. 2002-1G-2 dated as of April 30, 2002, by and between the Company and the Pass Through Trustee. 4(a)(4) Form of 6.417% Delta Air Lines Pass Through Certificate, Series 2002-1G-2 (included in Exhibit 4(a)(3)). 4(a)(5) Trust Supplement No. 2002-1C dated as of April 30, 2002, by and between the Company and the Pass Through Trustee. 4(a)(6) Form of 7.779% Delta Air Lines Pass Through Certificate, Series 2002-1C (included in Exhibit 4(a)(5)). 4(b)(1) Intercreditor Agreement dated as of April 30, 2002, by and among the Pass Through Trustee, Westdeutsche Landesbank Girozentrale, New York Brach (the "Liquidity Provider") and State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent (the "Subordination Agent"). 4(c)(1) Revolving Credit Agreement (2002-1G-1) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(c)(2) Revolving Credit Agreement (2002-1G-2) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(c)(3) Revolving Credit Agreement (2002-1C) dated as of April 30, 2002, by and between the Subordination Agent and the Liquidity Provider. 4(d)(1) Financial Guarantee Insurance Policy (2002-1G-1) issued by MBIA Insurance Corporation, dated April 30, 2002. 4(d)(2) Financial Guarantee Insurance Policy (2002-1G-2) issued by MBIA Insurance Corporation, dated April 30, 2002. 4(e)(1) Participation Agreement (N372DA) dated as of April 30, 2002, by and among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein. 4(e)(2) Indenture and Security Agreement (N372DA) dated as of April 30, 2002, by and between the Company and the Loan Trustee. 4(e)(3) Form of Series 2002-1 Equipment Notes issued in connection with the Boeing aircraft bearing U.S. registration number N372DA (included in Exhibit 4(e)(2)). 4(e)(4) Participation Agreement (N833MH) dated as of April 30, 2002, by and among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein. 4(e)(5) Indenture and Security Agreement (N833MH) dated as of April 30, 2002, by and between the Company and the Loan Trustee. 4(e)(6) Form of Series 2002-1 Equipment Notes issued in connection with the Boeing aircraft bearing U.S. registration number N833MH (included in Exhibit 4(e)(5)). 99 Schedule I.* EX-1.(A) 2 de763576-ex1a.txt UNDERWRITING AGREEMENT Exhibit 1(a) EXECUTION COPY DELTA AIR LINES, INC. Pass Through Certificates, Series 2002-1 UNDERWRITING AGREEMENT Dated: April 23, 2002 DELTA AIR LINES, INC. Enhanced Pass Through Certificates, Series 2002-1 UNDERWRITING AGREEMENT April 23, 2002 J.P. Morgan Securities Inc. Salomon Smith Barney Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated Commerzbank Capital Markets Corp. Mizuho International plc SunTrust Capital Markets Inc. Wachovia Securities, Inc. KBC Financial Products USA Inc. U.S. Bancorp Piper Jaffray Inc. c/o J.P. Morgan Securities Inc. 270 Park Avenue New York, NY 10017 c/o Salomon Smith Barney Inc. 390 Greenwich Street 4th Floor New York, NY 10013 Ladies and Gentlemen: Delta Air Lines, Inc., a Delaware corporation (the "Company"), proposes that State Street Bank and Trust Company of Connecticut, National Association ("State Street"), acting not in its individual capacity but solely as pass through trustee (the "Trustee") under the amended and restated Pass Through Trust Agreement dated as of November 16, 2000 (the "Basic Agreement"), as supplemented for each class of pass through certificates (the "Offered Certificates") to be purchased hereunder (each, an "Offered Class") by a Trust Supplement (each, an "Offered Trust Supplement"), in each case between the Company and the Trustee, issue and sell to the Underwriters named in Schedule I hereto its Offered Certificates in the aggregate amounts and with the applicable interest rates and final expected distribution dates set forth on Schedule II hereto on the terms and conditions stated herein. The Offered Trust Supplements relate to the creation and administration of Delta Air Lines Pass Through Trust, Series 2002-1G-1 (the "Class G-1 Trust"), Series 2002-1G-2 (the "Class G-2 Trust") and Series 2002-1C (the "Class C Trust" and, together with the Class G-1 Trust and Class G-2 Trust, the "Offered Trusts"). The Company will also cause State Street, as pass through trustee under Delta Air Lines Pass Through Trust, Series 2002-1D (the "Class D Trust" and, together with the Offered Trusts, the "Trusts"), to issue and privately place its pass through certificates (the "Class D Certificates" and, together with the Offered Certificates, the "Certificates"). The Class D Certificates will be issued pursuant to the Basic Agreement, as supplemented by a Trust Supplement for the Class D Trust (the "Class D Trust Supplement" and, together with the Offered Trust Supplements, the "Trust Supplements") (the Basic Agreement, as supplemented by the related Trust Supplement being referred to herein individually as a "Designated Agreement"). Concurrently with the issuance and sale of the Offered Certificates pursuant hereto, all of the Class D Certificates shall be privately placed with a newly organized Delaware business trust (the "Initial Class D Holder"), all of the beneficial interests in which will be initially owned by the Company and/or its affiliates. The Initial Class D Holder will be established pursuant to a trust agreement to be entered into between the Company (and/or its affiliates) and Wilmington Trust Company, as Owner Trustee, as of the Closing Date or prior thereto (the "Business Trust Agreement"). Each Class of the Certificates will represent interests in the related Trust established pursuant to the related Designated Agreement to fund the purchase of equipment notes to be issued by the Company in connection with the financing of 32 Aircraft. The equipment notes will be issued under 32 separate Indenture and Security Agreements between State Street, as Loan Trustee (the "Loan Trustee"), and the Company (each, an "Owned Aircraft Indenture"). Such equipment notes (the "Owned Aircraft Equipment Notes") will be acquired by the Trusts on the Closing Date (as defined below) in accordance with the participation agreements dated as of the Closing Date related to the Aircraft (the "Owned Aircraft Participation Agreements"). Each Boeing 737-832 Aircraft may be subject to a sale/leaseback transaction after the Closing Date, as set forth in the Owned Aircraft Participation Agreement related to such Aircraft. The sale/leaseback transaction for any such Aircraft will be implemented pursuant to, among other things, an amended and restated participation agreement (a "Leased Aircraft Participation Agreement"; the Leased Aircraft Participation Agreements and the Owned Aircraft Participation Agreements being collectively referred to herein as the "Participation Agreements"), a lease (a "Lease") and an amended and restated indenture (a "Leased Aircraft Indenture"; the Leased Aircraft Indentures and the Owned Aircraft Indentures being collectively referred to herein as the "Indentures"), in each case in the form thereof attached as an exhibit to the Owned Aircraft Participation Agreement related to such Aircraft and incorporating modifications permitted thereby. In connection with any such sale/leaseback transaction for any Aircraft, the obligations of Delta under the Owned Aircraft Equipment Notes secured by such Aircraft will be assumed by the related owner trustee and the owner trustee shall issue and deliver to the Trusts new equipment notes (the "Leased Aircraft Equipment Notes"; the Leased Aircraft Equipment Notes and the Owned Aircraft Equipment Notes being collectively referred to herein as the "Equipment Notes") in the form thereof included in the related Leased Aircraft Indenture and incorporating modifications permitted by the related Owned Aircraft Participation Agreement. The Leased Aircraft Participation Agreements, the Leases and the Leased Aircraft Indentures are collectively referred to herein as the "Lease Documents". The holders of each Class of the Offered Certificates will be entitled to the benefits of separate liquidity facilities with respect to certain amounts of interest payable thereon. Westdeutsche Landesbank Girozentrale (the "Liquidity Provider") will enter into a separate revolving credit agreement with respect to each Offered Trust (each, a "Liquidity Facility"), to be dated as of the Closing Date, for the benefit of the holders of the respective Class of Offered Certificates. The Liquidity Provider, MBIA Insurance Corporation, as provider of the Policies referred to below (in such capacity, the "Policy Provider") and the holders of the Certificates will be entitled to the benefits of an Intercreditor Agreement to be dated as of the Closing Date (the "Intercreditor Agreement") among State Street as Trustee of each Trust, the Liquidity Provider, State Street, as Subordination Agent (the "Subordination Agent") and the Policy Provider. Payments of interest on the Offered Certificates to be issued by the Class G-1 Trust and the Class G-2 Trust (the "Class G-1 Certificates" and the "Class G-2 Certificates", respectively) will be supported by two separate financial guaranty insurance policies (each, a "Policy") issued by the Policy Provider to the extent the respective Liquidity Facility for the Class G-1 Certificates or Class G-2 Certificates and any funds contained in the cash collateral account funded from such Liquidity Facility are not available for that purpose. The Policies will also support the payment of the final distribution on the Class G-1 Certificates and Class G-2 Certificates, as the case may be, and will take effect in certain other circumstances described in the Intercreditor Agreement and the Policies. The Policies will be issued pursuant to an insurance and indemnity agreement dated as of the Closing Date (the "Policy Provider Agreement") among the Policy Provider, the Company and the Subordination Agent. Under the Policy Provider Agreement, the Subordination Agent will reimburse the Policy Provider for amounts paid pursuant to claims made under the Policies. As used herein, unless the context otherwise requires, the term "Underwriters" shall mean the firms named as Underwriters in Schedule I and the term "you" shall mean J.P. Morgan Securities Inc. ("JPMorgan") and Salomon Smith Barney Inc. ("Salomon"). Capitalized terms used but not otherwise defined in this Agreement shall have the meanings specified in or pursuant to the Designated Agreements or the Intercreditor Agreement; provided that as used in this Agreement, the term "Operative Documents" shall mean the Intercreditor Agreement, the Liquidity Facilities, the Fee Letter, the Designated Agreements, the Participation Agreements, the Indentures, the Leases, the Policies, the Policy Fee Letter, the Policy Provider Agreement and the Indemnification Agreement dated the date hereof (the "Indemnification Agreement") among the Company, the Policy Provider and the Underwriters and the Business Trust Agreement. The Company has prepared and filed on Form S-3 with the Securities and Exchange Commission (the "Commission") a shelf registration statement (File No. 333-65218) (the "Registration Statement", as amended at the date hereof, including the exhibits thereto and the documents incorporated by reference therein, the "Registration Statement") relating to among others, certain pass through certificates (including the Offered Certificates) and the offering thereof from time to time in accordance with Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"). The Registration Statement has been declared effective by the Commission. As provided in Section 3(a), a prospectus supplement reflecting the terms of the Offered Certificates, the terms of the offering thereof and the other matters set forth therein has been prepared and will be filed together with the base prospectus referred to below pursuant to Rule 424 under the Securities Act (such prospectus supplement, in the form first filed on or after the date hereof pursuant to Rule 424, is herein referred to as the "Prospectus Supplement"). The base prospectus dated July 23, 2001 included in the Registration Statement and relating to all offerings of pass through certificates as supplemented by the Prospectus Supplement, is herein called the "Prospectus", except that, if such base prospectus is amended on or prior to the date on which the Prospectus Supplement is first filed pursuant to Rule 424, the term "Prospectus" shall refer to such base prospectus as so amended and as supplemented by the Prospectus Supplement, in either case including the documents filed by the Company with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that are incorporated by reference therein. The term "preliminary prospectus" means a preliminary prospectus supplement specifically relating to the Offered Certificates, together with the base prospectus and including the documents filed by the Company with the Commission pursuant to the Exchange Act that are incorporated by reference therein. Any reference herein to the terms "amendment" or "supplement" with respect to the Registration Statement, the Prospectus, or any preliminary prospectus shall be deemed to refer to and include any documents filed by the Company with the Commission under the Exchange Act after the date hereof, the date the Prospectus is filed with the Commission, or the date of such preliminary prospectus, as the case may be, and incorporated therein by reference pursuant to Item 12 of Form S-3 under the Securities Act. 1. Representations and Warranties. The Company represents and warrants to, and agrees with, each Underwriter that: (a) The Company meets the requirements for use of Form S-3 under the Securities Act. (b) The Registration Statement has been declared effective by the Commission. On the original effective date of the Registration Statement, on the effective date of any post-effective amendment thereto, and on the date of the filing by the Company of any Annual Report on Form 10-K after the original filing of the Registration Statement, the Registration Statement complied in all material respects with the applicable requirements of the Securities Act and the rules and regulations of the Commission thereunder (the "Securities Act Regulations"), and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the applicable rules and regulations of the Commission thereunder (the "Trust Indenture Act Regulations") and did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; the Registration Statement and any amendments thereof, on the date hereof, and the Prospectus, and any amendments thereof and supplements thereto, as of their respective filing or issue dates and at the Closing Date, comply and will comply in all material respects with the requirements of the Securities Act, the Securities Act Regulations, the Trust Indenture Act and the Trust Indenture Act Regulations, and neither the Prospectus nor any amendments thereof or supplements thereto, as of any such respective dates, includes or will include an untrue statement of a material fact or omits or will omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; except that this representation and warranty does not apply to statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished in writing to the Company in connection with the Registration Statement or the Prospectus or any amendment thereof or supplement thereto by or on behalf of such Underwriter through either of you expressly for use in the Prospectus and any amendments thereof or supplements thereto, or to statements or omissions in that part of the Registration Statement which constitutes the Statement of Eligibility under the Trust Indenture Act (Form T-1) of the Trustee. (c) The consolidated financial statements incorporated by reference in the Prospectus and any amendments thereof or supplements thereto present fairly the consolidated financial position of the Company and its subsidiaries as of the dates indicated and the consolidated results of their operations and cash flows for the periods specified and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis during the periods involved, except as indicated therein, and the supporting schedules incorporated by reference in the Registration Statement present fairly the information required to be stated therein. (d) The documents incorporated by reference in the Prospectus and any amendments thereof or supplements thereto, at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder. (e) Since the date of the latest audited financial statements incorporated by reference in the Registration Statement and Prospectus, there has been no material adverse change in, or any development known to the Company which would have a material adverse effect on, the consolidated financial condition or operations of the Company and its subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth or contemplated in the Registration Statement and Prospectus. (f) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority (corporate and other) to own its properties and conduct its business as it is now being conducted except where the failure to have such power or authority would not individually or in the aggregate have a material adverse effect on the consolidated financial condition or operations of the Company and its subsidiaries, taken as a whole. (g) The Company (i) is an "air carrier" within the meaning of 49 U.S.C. Section 40102(a), (ii) holds an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the United States Code for aircraft capable of carrying 10 or more individuals or 6,000 pounds or more of cargo, (iii) is a "citizen of the United States" as defined in 49 U.S.C. Section 40102 and (iv) is duly qualified as a foreign corporation for the transaction of business and in good standing under the laws of each jurisdiction (other than the State of Delaware) in which the Company has intrastate routes, or has a principal office or major overhaul facility and where the failure to so qualify would have a material adverse effect on the financial condition or operations of the Company and its subsidiaries, taken as a whole; and each material subsidiary of the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation. (h) The execution and delivery by the Company of this Agreement, the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, a party, the consummation by the Company of the transactions herein and therein contemplated, and the compliance by the Company with the terms hereof and thereof do not and will not conflict with, or result in a breach or violation of, any of the terms or provisions of, or constitute a default under, the Certificate of Incorporation or By-Laws, as amended, of the Company or any of its subsidiaries or any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or by which any of the property or assets of the Company or any of its subsidiaries is subject (except for such conflicts, breaches, violations and defaults as would not have a material adverse effect on the financial condition or operations of the Company and its subsidiaries, taken as a whole, and that would not affect the validity of the Equipment Notes or the Certificates), nor will such action result in any violation of the provisions of the Certificate of Incorporation or By-laws of the Company, or any statute or any order, rule or regulation of any court or governmental agency or body, having jurisdiction over the Company or any of its subsidiaries or any of their respective properties; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body, is required for the valid authorization, issuance and delivery of the Certificates and the Owned Aircraft Equipment Notes, the valid authorization, execution, delivery and performance by the Company of this Agreement, the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, a party, or the consummation by the Company of the transactions contemplated by this Agreement, the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, a party, except (i) such as are required under the Securities Act, the Trust Indenture Act and the securities or Blue Sky laws of the various states and, (ii) filings or recordings with the Federal Aviation Administration ("FAA") and under the Uniform Commercial Code as in effect in Delaware, which filings or recordings shall have been made or duly presented for filing on or prior to the Closing Date (or, in the case of such filings or recordings contemplated by the Lease Documents, the Delivery Date, as defined in the applicable Leased Aircraft Participation Agreement). (i) This Agreement, the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, a party, have each been duly authorized by the Company, and this Agreement and each Operative Document to which the Company is, or is to be, a party, have been or will be at or prior to the Closing Date, (or, in the case of the Lease Agreements relating to any Aircraft, the Delivery Date, as defined in the applicable Leased Aircraft Participation Agreement) duly executed and delivered by the Company. The Owned Aircraft Equipment Notes will be duly executed and delivered by the Company at or prior to the Closing Date. The Owned Aircraft Equipment Notes and the Operative Documents to which the Company is or is to be, a party, when duly executed and delivered by the Company, assuming in the case of the Operative Documents that such documents constitute the legal, valid and binding obligation of each other party thereto, constitute or will constitute valid and binding obligations of the Company. The form of the Basic Agreement filed as an exhibit to the Company's shelf registration statement (File No. 333-58647) has been duly qualified under the Trust Indenture Act. The Certificates, the Owned Aircraft Equipment Notes, the Operative Documents (other than the Leased Documents), the forms of Leased Aircraft Notes and the forms of Lease Documents attached to the Owned Aircraft Participation Agreements for the Boeing 737-832 Aircraft will conform in all material respects to the descriptions thereof in the Prospectus and any amendments thereof or supplements thereto. (j) Arthur Andersen LLP, who reported on the annual consolidated financial statements of the Company incorporated by reference in the Registration Statement and the Prospectus and any amendments thereof or supplements thereto, are independent accountants as required by the Securities Act and the Securities Act Regulations. (k) Deloitte & Touche LLP, who reviewed certain interim consolidated financial information of the Company incorporated by reference in the Registration Statement and the Prospectus and any amendments thereof or supplements thereto, are independent accountants as required by the Securities Act and the Securities Act Regulations. (l) When duly executed, authenticated and delivered by the Trustee in accordance with the terms of the related Designated Agreements and sold and paid for as provided in (i) this Agreement in the case of the Offered Certificates and (ii) the Class D Trust Supplement and the Business Trust Agreement, in the case of the Class D Certificates, the Certificates will be validly issued pursuant to the related Designated Agreements and will constitute valid and binding obligations of the related Trustees enforceable against the Trustees in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting enforcement of creditors' rights generally and by general principles of equity; and the holders thereof will be entitled to the benefits of the related Designated Agreements. (m) The Equipment Notes, when duly executed and delivered by the Company or the related owner trustee, as the case may be, and when duly authenticated by the Loan Trustee in accordance with the terms of the related Indentures, will be duly issued under such Indentures and will constitute valid and binding obligations of the Company; or such owner trustee, as the case may be, and the holders thereof will be entitled to the benefits of the related Indentures, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting enforcement of creditors' rights generally and by general principles of equity. (n) The statements set forth in the Registration Statement and Prospectus under the headings "Certain United States Federal Income Tax Consequences", "ERISA Considerations", "Certain Federal Income Tax Consequences" and "Certain ERISA Considerations", insofar as such statements purport to summarize certain legal matters, referred to therein, constitute accurate summaries thereof in all material respects. (o) Other than as set forth in the Registration Statement and Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, in the reasonable judgment of the Company, individually or in the aggregate are likely to have a material adverse effect on the consolidated financial condition or operations of the Company and its subsidiaries taken as a whole; and, to the best of the Company's knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others. (p) The Company has authorized capital stock as set forth in the Registration Statement and Prospectus, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; and all of the issued shares of capital stock of each material subsidiary (except for Aero Assurance Ltd. for which the Company owns approximately a 90% equity interest) of the Company have been fully and validly authorized and issued, are fully paid and non-assessable and (except for directors' qualifying shares) are owned directly or indirectly by the Company. (q) Neither the Company nor any of its affiliates, nor any person acting on their behalf, nor to the Company's knowledge any Trust has offered, sold or solicited an offer to buy, any Class D Certificates or any interest therein to any person or entity other than the Initial Class D Holder. The Company has not entered and will not enter into any contractual arrangement with respect to the issuance and initial sale of the Class D Certificates except as contemplated by the Operative Documents. (r) At the Closing Date, the Initial Class D Holder will be duly formed and be validly existing in good standing as a business trust under the Delaware Business Trust Act (the "DBTA") and have the power and authority under the Business Trust Agreement and the DBTA to own and hold its property. At the Closing Date, the Company or one of its affiliates will directly or indirectly own all of the beneficial interests in the Initial Class D Holder free and clear of any lien, encumbrance, security interest or similar claim or interests. (s) The issuance and sale of the Class D Certificates and the related Owned Aircraft Equipment Notes, as contemplated by the Operative Documents, will not be subject to the registration requirements of the Securities Act, and the Designated Agreement for the Class D Certificates will not be required to be qualified under the Trust Indenture Act. 2. Purchase and Sale. (a) On the basis of the representations and warranties herein contained and subject to the terms and conditions herein and therein set forth, the Company agrees to cause the Trustee to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Trustee, at a purchase price of 100% of the principal amount thereof, the aggregate principal amount of each Class of Offered Certificates set forth opposite the name of such Underwriter in Schedule I. (b) Payment of the purchase price for, and delivery of, the Offered Certificates shall be made at the offices of Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038 at 10:00am on April 30, 2002, or at such other date, time or location or locations as shall be agreed upon by the Company and you, or as shall otherwise be provided in Section 7 (such date and time being herein called the "Closing Date"). Payment shall be made to or upon the order of the Trustees by federal funds wire transfer or other immediately available funds against delivery to the account of J.P. Morgan Securities Inc. at The Depository Trust Company for the respective accounts of the several Underwriters of the Offered Certificates. Such Offered Certificates shall be registered in the name of Cede & Co. or in such other names, and in such authorized denominations as you may request in writing at least two full business days before the Closing Date. Certificates for such Offered Certificates, which may be in temporary form, will be made available for examination and packaging by you at the location or locations at which they are to be delivered at the Closing Date not later than 9:30 A.M., New York City time, on the business day prior to the Closing Date. (c) The Company will pay to J.P. Morgan Securities Inc. at the Closing Date for the accounts of the Underwriters the sum of $7,318,097. Such payment will be made by federal funds wire transfer or other immediately available funds. 3. Agreements. The Company covenants with each Underwriter as follows: (a) Immediately following the execution of this Agreement, the Company will prepare a final Prospectus Supplement in a form reasonably approved by you, that complies with the Securities Act and the Securities Act Regulations and which sets forth the principal amount of the Offered Certificates and their terms not otherwise specified in the base prospectus relating to all offerings of pass through certificates under the Registration Statement, the name of each Underwriter participating in the offering and the principal amount of the Offered Certificates that each severally has agreed to purchase, the price at which the Offered Certificates are to be purchased by the Underwriters from the Trustee, any initial public offering price, any selling concession and reallowance, and such other information as you and the Company deem appropriate in connection with the offering of the Offered Certificates. The Company will promptly transmit copies of the Prospectus and any amendments thereof or any supplement thereto to the Commission for filing pursuant to Rule 424 under the Securities Act and will furnish to the Underwriters as many copies of the Prospectus as you shall reasonably request. (b) During the period when a prospectus relating to the Offered Certificates is required to be delivered under the Securities Act, the Company will promptly advise you of (i) the effectiveness of any amendment to the Registration Statement, (ii) the transmittal to the Commission for filing of any supplement to the Prospectus or any document that would as a result thereof be incorporated by reference in the Prospectus, (iii) any request by the Commission for any amendment of the Registration Statement or any amendment or supplement to the Prospectus or for any additional information relating thereto or to any document incorporated by reference therein, (iv) the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the institution or threatening of any proceeding for that purpose, and (v) the receipt by the Company of any notification with respect to the suspension of the qualification of the Offered Certificates for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Company will use its best efforts to prevent the issuance of any such stop order and, if issued, to obtain as soon as possible the withdrawal thereof. (c) If, at any time when a prospectus relating to the Offered Certificates is required to be delivered under the Securities Act, any event occurs as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it shall be necessary to amend or supplement the Prospectus to comply with the Securities Act or the Securities Act Regulations, the Company promptly will prepare and file with the Commission, subject to paragraph (d) of this Section 3, an amendment or supplement which will correct such statement or omission or an amendment or supplement which will effect such compliance. Neither your consent to, nor the Underwriters' delivery of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 4. (d) At any time when a prospectus relating to the Offered Certificates is required to be delivered under the Securities Act or the Securities Act Regulations, the Company will give you notice of its intention to file any amendment to the Registration Statement or any amendment or supplement to the Prospectus, whether pursuant to the Exchange Act, the Securities Act or otherwise, will furnish you with copies of any such amendment or supplement or other documents proposed to be filed within a reasonable time in advance of filing, and will not file any such amendment or supplement or other documents in a form to which you shall reasonably object. (e) The Company has furnished or will furnish to you and your counsel, without charge, conformed copies of the Registration Statement as originally filed and of all amendments thereto, whether filed before or after the Registration Statement originally became effective (including exhibits thereto and the documents incorporated therein by reference) and, so long as delivery of a prospectus by an Underwriter or dealer may be required by the Securities Act, as many copies of each preliminary prospectus, the Prospectus and any amendments thereof and supplements thereto as you may reasonably request. (f) The Company will promptly take such actions as you may request to qualify the Offered Certificates for sale under the laws of such jurisdictions as you may reasonably request and will maintain such qualifications in effect so long as required for the distribution of such Offered Certificates. The Company, however, shall not be obligated to qualify as a foreign corporation or file any general consent to service of process under the laws of any such jurisdiction or subject itself to taxation as doing business in any such jurisdiction. (g) The Company, during the period when a prospectus relating to the Offered Certificates is required to be delivered under the Securities Act and the Securities Act Regulations, will file promptly all documents required to be filed with the Commission pursuant to Section 13 or 14 of the Exchange Act. (h) The Company will make generally available to its security holders, in each case as soon as practicable, but not later than 45 days after the close of the period covered thereby (90 days in case the period covered corresponds to a fiscal year of the Company), earnings statements of the Company, which will comply as to form with the provisions of Rule 158 under the Securities Act. (i) Between the date of this Agreement and the Closing Date, the Company will not, without your prior consent, offer, sell or enter into any agreement to sell any public debt securities registered under the Securities Act (other than the Offered Certificates) or any debt securities which may be sold in a transaction exempt from the registration requirements of the Securities Act in reliance on Rule 144A under the Securities Act and which are marketed through the use of a disclosure document containing substantially the same information as a prospectus for similar debt securities registered under the Securities Act, it being expressly understood that, without limitation, nothing in this Section 3(i) shall require your consent to (x) any financings by subsidiaries not to exceed $75 million or (z) the sale of the Class D Certificates or any interest therein. 4. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters to purchase and pay for the Offered Certificates pursuant to this Agreement shall be subject in their discretion to the accuracy of and compliance with the representations and warranties of the Company contained herein as of the date hereof and the Closing Date, to the accuracy of the statements of the Company's officers made in any certificates furnished pursuant to the provisions hereof, to the performance by the Company of its covenants and other obligations hereunder and to the following additional conditions: (a) At the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued under the Securities Act and no proceedings therefor shall have been instituted or threatened by the Commission. (b) At the Closing Date, you shall have received: (1) An opinion, dated the Closing Date, from Leslie P. Klemperer, Vice President-Associate General Counsel and Assistant Secretary of the Company, in form and substance satisfactory to you, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority (corporate and other) to own its properties and to conduct its business as it is now being conducted; except where the failure to have such power or authority would not individually or in the aggregate have a material adverse effect on the financial condition or operations of the Company and its subsidiaries, taken as a whole; (ii) The Company is an "air carrier" within the meaning of the 49 U.S.C. Section 40102(a), as amended, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each jurisdiction in the United States of America other than that of its incorporation in which it has intrastate routes or has a principal office or major overhaul facility and where the failure to so qualify would have a material adverse effect on the financial condition or operations of the Company and its subsidiaries, taken as a whole (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Company, provided that such counsel shall state that such counsel believes that the Underwriters and such counsel are justified in relying upon such opinions and certificates). The Company holds an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the United States Code pursuant to which the Company is authorized to operate the Aircraft and the Company is a "citizen of the United States" as defined in 49 U.S.C. Section 40102; (iii) The Company has an authorized capital stock as set forth in the Registration Statement and Prospectus and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; (iv) Each material subsidiary of the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation; and all of the issued shares of capital stock of each such subsidiary (except for directors' qualifying shares) are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims; (such counsel being entitled to rely in respect of the opinion in this clause (iv) upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Company or its subsidiaries, provided that such counsel shall state that they believe that both the Underwriters and such counsel are justified in relying upon such opinions and certificates); (v) The Company has the corporate power and authority under Delaware law to perform its obligations hereunder and under the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, as of the Closing Date, a party; (vi) The Registration Statement has become effective under the Securities Act, the Basic Agreement has been duly qualified under the Trust Indenture Act and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or threatened; (vii) The Registration Statement, the Prospectus and each amendment thereof or supplement thereto (except in each case for the financial statements and related schedules and other financial data included or incorporated by reference therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Securities Act and the Securities Act Regulations when they became effective or were filed with the Commission; the Basic Agreement and the Statement of Eligibility of the Trustee on Form T-1 filed with the Commission as part of the Registration Statement comply as to form in all material respects with the requirements of the Trust Indenture Act and the rules and regulations thereunder; and each document filed pursuant to the Exchange Act and incorporated by reference in the Prospectus (except in each case for the financial statements and related schedules and other financial data included or incorporated by reference therein, as to which counsel need express no opinion) appeared on its face, as of its respective filing date, to comply as to form in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder; (viii) This Agreement has been duly authorized, validly executed and delivered by the Company; (ix) Each of the Operative Documents to which the Company is, or is to be, a party as of the Closing Date has been duly authorized, executed and delivered by the Company; (x) The execution and delivery by the Company of this Agreement, the Owned Aircraft Equipment Notes and the Operative Documents to which the Company is, or is to be, as of the Closing Date, a party, the consummation by the Company of the transactions herein and therein contemplated and in the manner herein and therein contemplated and compliance by the Company with the terms hereof and thereof, do not and will not conflict with, or result in a breach or violation of, any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument known to such counsel to which the Company or any of its subsidiaries is a party or to which the Company or any of its subsidiaries is bound or by which any of the property or assets of the Company or any of its subsidiaries is subject (except for such conflicts, breaches, violations and defaults that would not have a material adverse effect on the financial condition or operations of the Company and its subsidiaries, taken as a whole, and that would not affect the validity of the Owned Aircraft Equipment Notes or the Certificates), nor will such actions result in any violation of the provisions of the Certificate of Incorporation, as amended, or By-Laws of the Company, or any statute or rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their respective properties; (xi) To the best of such counsel's knowledge after reasonable investigation, no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the valid authorization, issuance, sale and delivery of the Certificates or the Owned Aircraft Equipment Notes, the valid authorization, execution, delivery and performance by the Company of this Agreement and the Operative Documents to which the Company is, or is to be, as of the Closing Date, a party, or the consummation by the Company of the other transactions contemplated by this Agreement and the other Operative Documents to which the Company is, or is to be, as of the Closing Date, a party, except such as have been obtained under the Securities Act and the Trust Indenture Act, and such as may be required under the securities or Blue Sky laws of the various states in connection with the purchase and distribution of the Certificates and Owned Aircraft Equipment Notes, and except for the filing of Uniform Commercial Code financing statements (or amendments to any such financing statements) and the filing of continuation statements with respect thereto required to be filed at periodic intervals under the Uniform Commercial Code and any filings or recordings with the Federal Aviation Administration, as to which such counsel need express no opinion; (xii) Such counsel has no reason to believe that the statements in the Registration Statement and the Prospectus with respect to statutes, administrative orders and regulations and legal and governmental proceedings do not fairly and accurately present in all material respects the information required to be set forth therein; except that such counsel need express no opinion as to the matters to be addressed in clauses (ii), (iii) and (iv) of the opinion referred to in Section 4(b)(2) hereof and paragraphs 6, 7, and 9 of the form of opinion of Bingham Dana LLP set forth in Exhibit A hereto; and there are, to the best of such counsel's knowledge, no statutes, administrative orders or regulations or legal or governmental proceedings required to be described in the Registration Statement or the Prospectus which are not described as required, nor any contracts or documents of a character required to be described in the Registration Statement or the Prospectus, or to be filed as exhibits to the Registration Statement, that are not so described or filed as required; (xiii) There are various legal or governmental proceedings pending to which the Company or certain of its subsidiaries is a party or to which property of the Company or certain of its subsidiaries is the subject. Although the ultimate outcome of these proceedings cannot be predicted with certainty, to the best of counsel's knowledge, after reasonable investigation, there are no such legal or governmental proceedings pending which, individually or in the aggregate, are likely to have a material adverse effect on the consolidated financial condition, results of operations or liquidity of the Company and its subsidiaries taken as a whole; and, to the best of such counsel's knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others; (xiv) The statements in the Prospectus as to the route system which the Company presently operates or is authorized to operate are correct in all material respects and no authorization of the Company to operate any such route is the subject of any "show cause" or other order of, or any proceeding before, or any investigation by, the Department of Transportation (other than proceedings for the granting or renewal of temporary certificates or exemption rights) which in the opinion of such counsel is reasonably likely to result in a final order impairing the validity of such certificates or exemption orders; (xv) The issuance, sale and delivery of the Class D Certificates, as contemplated by the Operative Documents, are not subject to the registration requirements of the Securities Act, and the Designated Agreement relating to the Class D Certificates is not required to be qualified under the Trust Indenture Act. Such counsel shall also state that no facts have come to the attention of such counsel which have caused such counsel to believe (A) that the Registration Statement or any amendments thereto, on the original effective date thereof, or on the effective date of any post-effective amendments thereto, or on the date of the filing by the Company with the Commission of its most recent Annual Report on Form 10-K after the filing of the Registration Statement (except, in each case, for the financial statements and related schedules and other financial data included or incorporated by reference therein, and except for the Statement of Eligibility on Form T-1 of the Trustee under the Basic Agreement, as to which such counsel need express no belief), contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or (B) that the Prospectus at the time the Prospectus Supplement was issued or the Prospectus, together with any amendment or supplement thereto, at the time any such amended or supplemental Prospectus was issued, or at the Closing Date (except, in each case, for the financial statements and related schedules and other financial data included or incorporated by reference therein, as to which such counsel need express no belief), contained or contains any untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. In giving such opinion, such counsel may state that such opinion is limited to the laws of the State of Georgia, the General Corporation Law of the State of Delaware and the Federal laws of the United States, except that such counsel expresses no opinion as to the securities laws of any state. In rendering the opinions set forth above, such counsel may rely upon certificates of officers of the Company and of public officials as to matters of fact. (2) An opinion, dated the Closing Date, of Cadwalader, Wickersham & Taft, as counsel for the Company, in form reasonably satisfactory to you and your counsel, to the effect that: (i) The Certificates have been issued and delivered by the Trustee pursuant to the related Designated Agreements and constitute valid and binding obligations of the Trustee enforceable against the Trustee in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting enforcement of creditors' rights generally and by general principles of equity; and the holders of the Certificates are entitled to the benefits of the related Designated Agreements; (ii) The statements in the Registration Statement and Prospectus Supplement under the headings "Certain United States Federal Income Tax Consequences", "ERISA Considerations", "Certain U.S. Federal Income Tax Consequences" and "Certain ERISA Considerations", to the extent such statements summarize material tax consequences or material consequences under ERISA, respectively, of the purchase, beneficial ownership and disposition of the Certificates to the beneficial owner thereof described therein are correct in all material respects; (iii) The Trusts created by the Designated Agreements should not be classified as associations (or as publicly traded partnerships) taxable as corporations for federal income tax purposes, but rather, based on an interpretation of analogous authorities under existing law, each Trust should be classified as a grantor trust under subpart E, Part I of Subchapter J of Chapter 1 of subtitle A of the Internal Revenue Code of 1986, as amended, and each person acquiring a beneficial interest in a Certificate should be treated as the owner of a pro rata undivided interest in each of the related Equipment Notes and any other property held in the related Trust; (iv) Section 1110 of the Bankruptcy Code conforms in all material respects to the description thereof contained in "Description of the Equipment Notes - Remedies" in the Prospectus; (v) The Trusts are not required to be registered under the Investment Company Act of 1940, as amended; (vi) Assuming due authorization, execution and delivery by each of the parties to the Operative Documents, each such agreement (other than (a) each Liquidity Facility, with respect to the Liquidity Provider, (b) the Policy Provider Agreement, with respect to the Policy Provider, (c) the Business Trust Agreement and (d) the Lease Documents) constitutes the valid and binding obligation of each respective party, enforceable in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting enforcement of creditors' rights generally and by general principles of equity; (vii) The Certificates, the Owned Aircraft Equipment Notes, the Operative Documents (other than the Lease Documents), the forms of Leased Aircraft Notes and the forms of Lease Documents attached to the Owned Aircraft Participation Agreements for the Boeing 737-832 Aircraft conform in all material respects to the descriptions thereof contained in the Prospectus and such descriptions conform in all material respects to the rights set forth in the instruments defining the same; and (viii) The Owned Aircraft Equipment Notes, when duly authorized, executed and delivered by the Company and duly authenticated by the related Loan Trustee, will constitute valid and binding obligations of the Company enforceable against the Company in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting enforcement of creditors' rights generally and by general principles of equity and the holders of the Equipment Notes will be entitled to the benefits of the respective Indentures. The opinions of such counsel expressed in the immediately preceding clause (vi) shall be limited to the laws of the State of New York governing the enforceability of contracts as such and in giving such opinion, such counsel may rely as to certain matters acceptable to you upon the opinions referred to in Section 4(b)(1) and Section 4(b)(3) hereof, in which case the opinion shall state that such counsel believes that it and the Underwriters are entitled to so rely. In rendering the opinions set forth above, such counsel may rely upon certificates of officers of the Company and of public officials as to matters of fact. Such counsel shall also state that no facts have come to the attention of such counsel which have caused such counsel to believe that (other than with regard to facts or information regarding the Company and its operations which are contained in the Prospectus Supplement or incorporated by reference therein, to which such counsel need express no belief) the Prospectus at the time the Prospectus Supplement was issued or the Prospectus, together with any amendment or supplement thereto, at the time any such amended or supplemental Prospectus was issued, or at the Closing Date (except, in each case, for the financial statements and related schedules and other financial data included or incorporated by reference therein, as to which such counsel need express no belief), contained or contains any untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. In giving such opinion, such counsel may state that such opinion is limited to the laws of the States of New York, the General Corporation Law of the State of Delaware and the Federal laws of the United States, except that such counsel expresses no opinion as to the securities laws of any state. In rendering the opinions set forth above, such counsel may rely upon certificates of officers of the Company and of public officials as to matters of fact. (3) An opinion, dated the Closing Date, of Bingham Dana, counsel for State Street, individually, as Subordination Agent, Trustee and Loan Trustee, in form and substance reasonably satisfactory to you and your counsel and substantially to the effect set forth in Exhibit A hereto. (4) An opinion, dated the Closing Date, from in-house counsel for the Liquidity Provider, in form and substance satisfactory to you and your counsel and substantially to the effect set forth in Exhibit B hereto. (5) An opinion, dated the Closing Date, from Milbank Tweed Hadley & McCloy LLP, counsel for the Liquidity Provider, in form and substance satisfactory to you and your counsel and substantially to the effect set forth in Exhibit C hereto. (6) An opinion, dated the Closing Date, from in-house counsel for the Policy Provider, in form and substance satisfactory to you and your counsel and substantially to the effect set forth in Exhibit D hereto. (7) An opinion, dated the Closing Date, from Latham & Watkins, counsel for the Policy Provider, in form and substance satisfactory to you and your counsel and substantially to the effect set forth in Exhibit E hereto. (8) An opinion dated the Closing Date, from Richards, Layton & Finger, PA, special Delaware counsel to the Initial Class D Holder, in form and substance satisfactory to you and your counsel and substantially to the effect set forth in Exhibit F hereto. (9) An opinion, dated the Closing Date, from Shearman & Sterling, counsel for the Underwriters, to the effect that the opinions delivered pursuant to subsections (b)(1) through (b)(8) of this Section 4 appear on their face to be appropriately responsive to the requirements of this Agreement except, specifying the same, to the extent waived by you and with respect to the issuance and sale of the Offered Certificates, the Registration Statement, the Prospectus and other related matters as you may reasonably require. (c) On or after the date hereof, there shall not have been (i) any change or decrease, specified in the letters referred to in paragraph (d) of this Section 4 or (ii) any change, or any development involving a prospective change, in or affecting the business or properties of the Company and its subsidiaries, taken as a whole, the effect of which, in any case referred to in clause (i) or (ii) above, is, in your reasonable judgment, so material and adverse as to make it impractical or inadvisable to proceed with the public offering or the delivery of the Offered Certificates as contemplated by the Prospectus as amended or supplemented; and you shall have received a certificate of the President, an Executive Vice President, a Senior Vice President or a Vice President of the Company, dated as of the Closing Date, to the effect that (i) there has been no such material adverse change, (ii) that the representations and warranties in Section 1 hereof and also the representations and warranties of the Company contained in the Operative Documents are true and correct with the same force and effect as though made at such Closing Date, and as to such other matters as you may reasonably request. (d) At the time of the execution of this Agreement and also on the Closing Date, Arthur Andersen LLP and Deloitte & Touche LLP shall each have furnished to you a letter or letters, dated the respective dates of delivery thereof, in form and substance satisfactory to you, together with signed or reproduced copies of such letters for each of the other Underwriters containing statements and information of the type ordinarily included in accountants' "comfort letters" to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus and any amendments thereof or supplements thereto. (e) The Company shall have furnished to you and your counsel, in form and substance satisfactory to them, such other documents, certificates and opinions as such counsel may reasonably request for the purpose of enabling such counsel to pass upon the matters referred to in subsection (b)(9) of this Section 4 and in order to evidence the accuracy and completeness of any of the representations, warranties or statements, the performance of any covenant by the Company theretofore to be performed, or the compliance with any of the conditions herein contained. (f) Each of the Appraisers shall have furnished to the Underwriters a letter from such Appraiser, addressed to the Company and dated the Closing Date, confirming that such Appraiser and each of its directors and officers (i) is not an affiliate of the Company or any of its affiliates, (ii) does not have any substantial interest, direct or indirect, in the Company or any of its affiliates and (iii) is not connected with the Company or any of its affiliates as an officer, employee, promoter, Underwriter, trustee, partner, director or person performing similar functions. (g) At the Closing Date, the Offered Certificates shall be rated AAA, in the case of the Offered Certificates of the Class G-1 Trust, AAA, in the case of the Offered Certificates of the Class G-2 Trust and A-, in the case of the Offered Certificates of the Class C Trust, by Standard & Poor's Ratings Services, a division of the McGraw-Hill Companies, Inc. and Aaa, in the case of the Offered Certificates of the Class G-1 Trust, Aaa, in the case of the Offered Certificates of the Class G-2 Trust and Baa2, in the case of the Offered Certificates of the Class C Trust, by Moody's Investors Service, Inc. (h) At the Closing Date, all conditions precedent specified in each Owned Aircraft Participation Agreement with respect to the funding of the related Owned Aircraft Equipment Notes, shall have been satisfied; each of the Owned Aircraft Equipment Notes and Operative Documents (other than the Lease Documents) shall have been executed and delivered by each party thereto; (i) the representations and warranties of the Trustee, the Subordination Agent and the Loan Trustee contained in each of the Owned Aircraft Participation Agreements and (ii) the representations and warranties of the Owner Trustee contained in the Business Trust Agreement shall be accurate as of the Closing Date (except to the extent that they relate solely to an earlier date in which case they shall be accurate as of such earlier date) and you shall have received certificates of the Company and appropriate officers of the Subordination Agent, Pass Through Trustees, Loan Trustees and Owner Trustee, dated as of the Closing Date, to such effect; and you shall have received a copy of each opinion required to be delivered under each of the Owned Aircraft Participation Agreements dated as of the Closing Date, and addressed to you, and of such other documents furnished in connection with the fulfillment of such conditions as you may reasonably request. (i) On or after the date hereof (i) no downgrading shall have occurred in the rating accorded the Company's unsecured debt securities by any "nationally recognized statistical rating organization", as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company's unsecured debt securities. (j) At the Closing Date, simultaneously with the issuance and sale of the Offered Certificates in accordance with this Agreement, the Class D Certificates shall have been issued, sold and delivered to the Initial Class D Holder. All such opinions, certificates, letters and documents shall be deemed to be in compliance with the provisions hereof only if they are in all respects reasonably satisfactory to you and your counsel. If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, other than by reason of any default by any Underwriter, such failure to fulfill a condition may be waived by you, or this Agreement may be terminated by you by notice to the Company at any time at or prior to the Closing Date, and such termination shall be without liability of any party to any other party, except as provided in Sections 5, 6 and 9 hereof, which provisions shall remain in effect notwithstanding such termination. 5. Payment of Expenses. The Company will pay or cause to be paid all expenses incident to the performance of the obligations of the Company under this Agreement, including (i) expenses relating to the preparation, printing, filing and distribution of any preliminary prospectus supplements, the Prospectus and any amendments thereof or supplements thereto, the Registration Statement and any amendments thereof or supplements thereto, (ii) expenses relating to the preparation, printing and distribution of any agreement among Underwriters, this Agreement, the Certificates, the Equipment Notes, the Operative Documents, any Underwriter's Questionnaire, the Blue Sky Survey and any Legal Investment Survey by the Underwriter's counsel, (iii) expenses relating to the issuance and delivery of the Offered Certificates to the Underwriters, (iv) the fees and disbursements of the Company's counsel and accountants, (v) expenses of qualifying the Offered Certificates under state securities laws in accordance with Section 3(f), including filing fees and fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the Blue Sky Survey and any Legal Investment Survey, (vi) the fees and expenses of the Trustee, the Subordination Agent, the Loan Trustees, the Owner Trustee, the Policy Provider and the Liquidity Provider and the fees and disbursements of their respective counsel, (vii) any fees charged by rating agencies for rating the Offered Certificates, and (viii) certain fees and expenses of counsel for the Underwriters as heretofore agreed. The Company will also cause to be paid all expenses incident to the performance of its obligations under the Operative Documents and each of the other agreements and instruments referred to therein which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, and Sections 6 and 10 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Offered Certificates by them, and any advertising expenses connected with any offers they may make. 6. Indemnification and Contribution. (a) The Company will indemnify and hold harmless each Underwriter, and each person who controls such Underwriter within the meaning of either the Securities Act or the Exchange Act, against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement as originally filed or in any amendment thereof, or in any preliminary prospectus relating to the Offered Certificates or in the Prospectus, or in any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, (i) that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon, and in conformity with, written information furnished to the Company by any Underwriter through either of you specifically for use in connection with the preparation thereof or made in the part of the Registration Statement constituting the Statement of Eligibility under the Trust Indenture Act of the Trustee on Form T-1, (ii) such indemnity with respect to any preliminary prospectus shall not inure to the benefit of any Underwriter or any person controlling such Underwriter as to whom it shall be established that such Underwriter did not send or deliver to the person asserting any such loss, claim, damage or liability and who purchased Offered Certificates which are the subject thereof a copy of the Prospectus as amended or supplemented (other than the documents incorporated by reference therein) at or prior to the written confirmation of the sale of such Offered Certificates in any case where such delivery is required by the Securities Act and the untrue statement or omission of a material fact contained in such preliminary prospectus was corrected in the Prospectus as amended or supplemented and the Company had previously furnished copies thereof to such Underwriter, and (iii) the Company will not be liable for any such loss, claim, damage or liability in connection with any settlement of any pending or threatened litigation or any pending or threatened governmental agency investigation or proceeding if that settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld. This indemnity agreement will be in addition to any liability which the Company may otherwise have. (b) Each Underwriter severally agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement, and each person who controls the Company within the meaning of either the Securities Act or the Exchange Act, to the same extent as the foregoing indemnity from the Company to each Underwriter and agrees to reimburse each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any loss, claim, damage, liability or action, but only with reference to written information furnished to the Company by such Underwriter specifically for inclusion in the Registration Statement or in any amendment thereto or the Prospectus or any amendment or supplement thereto. This indemnity agreement will be in addition to any liability which any Underwriter may otherwise have. (c) Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental investigation), such indemnified party will, if a claim for indemnification in respect thereof is to be made against the indemnifying party under Section 6(a) or (b) hereof, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party otherwise than under Section 6(a) or (b) hereof, and then only to the extent that the indemnifying party is prejudiced thereby. In case any such action or proceeding is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein (jointly with any other indemnifying party similarly notified), and to the extent that it may elect, by written notice, delivered to such indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party; provided, however, that if the defendants (including any impleaded parties) in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified party or parties shall have the right to select separate counsel to defend such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of its election so to appoint counsel to defend such action and approval by the indemnified party of such counsel, the indemnifying party will not be liable to such indemnified party under this Section 6 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed separate counsel in accordance with the proviso to the next preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expense of more than one separate counsel, approved by the Underwriters in the case of paragraph (a) of this Section 6, representing the indemnified parties under such paragraph (a) who are parties to such action), (ii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice or commencement of the action or (iii) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party; and except that, if clause (i) or (iii) is applicable, such liability shall be only in respect of the counsel referred to in such clause (i) or (iii). (d) In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in paragraph (a) or (b) of this Section 6 is due in accordance with its terms but is for any reason unavailable on grounds of policy or otherwise, the Company and the Underwriters shall contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigation or defending same) to which the Company and one or more of the Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Offered Certificates to which such loss, claim, damage, or liability (or action in respect thereof) relates. If the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable to such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Offered Certificates pursuant to this Agreement shall be deemed to be in the same proportion as the total net proceeds from the offering of the Offered Certificates pursuant to this Agreement (net of compensation paid to the Underwriters but before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters in each case as set forth on the cover of the Prospectus, bears to the aggregate initial public offering price of the Offered Certificates as set forth on such cover. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or such Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute hereunder or under the Indemnification Agreement in aggregate any amount in excess of the amount by which (i) the total price at which the Offered Certificates underwritten by it and distributed to the public were offered to the public exceeds (ii) the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 6, each person who controls any Underwriter within the meaning of either the Section 15 of the Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as any Underwriter, and each person who controls the Company within the meaning of either the Securities Act or the Exchange Act, each officer of the Company and each director of the Company shall have the same rights to contribution as the Company, subject in each case to the provisions of this paragraph (d). The obligations of the Underwriters of Offered Certificates in this subsection (d) to contribute are several in proportion to their respective purchase obligations with respect to such Offered Certificates and not joint. 7. Default. (a) If any Underwriter shall default in its obligation to purchase the Offered Certificates of any Class which it has agreed to purchase hereunder, you may in your discretion arrange for you or another party or other parties to purchase such Offered Certificates on the terms contained herein. If within thirty-six hours after such default by any Underwriter you do not arrange for the purchase of such Offered Certificates, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties satisfactory to you to purchase such Offered Certificates on such terms. In the event that, within the respective prescribed periods, you notify the Company that you have so arranged for the purchase of such Offered Certificates, or the Company notifies you that it has so arranged for the purchase of such Offered Certificates, you or the Company shall have the right to postpone the Closing Date for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement and Prospectus, or in any other documents or arrangements, and the Company agrees to prepare promptly any amendments to the Registration Statement and Prospectus which in your reasonable opinion may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to this Agreement with respect to such Offered Certificates. (b) If, after giving effect to any arrangements for the purchase of the Offered Certificates of a defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above, the aggregate principal amount of Offered Certificates of any Class which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Offered Certificates of such Class, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Offered Certificates of such Class which such Underwriter agreed to purchase hereunder and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Offered Certificates of such Class which such Underwriter agreed to purchase hereunder) of the Offered Certificates of such Class of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Offered Certificates of a defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above, the aggregate principal amount of Offered Certificates of any Class which remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Offered Certificates of such Class, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Offered Certificates of a defaulting Underwriter or Underwriters, then this Agreement shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the Company, except for the expenses to be borne by the Company and the Underwriters as provided in Section 5 hereof and the indemnity and contribution agreements in Section 6 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 8. Termination. This Agreement shall be subject to termination in your discretion, by notice given to the Company prior to Closing Date, if prior to such time (i) trading in the Company's common stock shall have been suspended by the Commission or the New York Stock Exchange or trading in securities generally on the New York Stock Exchange shall have been suspended or materially limited or minimum prices shall have been established on such Exchange, (ii) a banking moratorium shall have been declared either by Federal or New York State authorities or (iii) there shall have occurred any material outbreak or material escalation of hostilities or other calamity or crisis the effect of which on the financial markets of the United States is such as to make it, in your reasonable judgment, impracticable to market such Offered Certificates. 9. Representations, Warranties, Indemnities and Agreements to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements of the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, or any officer or director or controlling person of the Company, and shall survive delivery of and payment for the Offered Certificates. 10. Liability upon Termination. If this Agreement shall be terminated pursuant to Section 7 hereof, the Company shall not then be under any liability to any Underwriter except as provided in Sections 5 and 6 hereof; but, if for any other reason, the Offered Certificates are not delivered by or on behalf of the Company as provided herein, because the Company fails to satisfy any of the conditions set forth in Section 4 hereof (other than the condition in Section 4(i)(ii) or because of any refusal, inability or failure of the Company to perform any agreement herein or to comply with any provision hereof, other than by reason of a default by the Underwriters), the Company will reimburse the Underwriters through JPMorgan for all out-of-pocket expenses approved in writing by JPMorgan, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Offered Certificates, but the Company shall then be under no further liability to any Underwriter with respect to such Offered Certificates except as provided in Section 5 and Section 6 hereof. 11. Notices. In all dealings hereunder, you shall act on behalf of each of the Underwriters, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by you jointly or by JPMorgan or Salomon on behalf of you as the representatives. It is understood and agreed that JPMorgan and Salomon are joint book runners for the offering and any determinations or other actions to be made under this Agreement by you shall require the concurrence of both JPMorgan and Salomon. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to you as the representatives in care of J.P. Morgan Securities Inc., 270 Park Avenue, New York, NY 10017, Attention: Arthur Ryan and in care of Salomon Smith Barney Inc., 388 Greenwich Street, 34th Floor, New York, NY 10013, Attention: General Counsel's Office; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: Chief Financial Officer (with a copy to the General Counsel); provided, however, that any notice to an Underwriter pursuant to Section 6(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by you upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 12. Parties. This Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company and, to the extent provided in Sections 6 and 9 hereof, the officers and directors of the Company and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of any of the Offered Certificates from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 13. Time of the Essence. Time shall be of the essence of this Agreement. 14. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. 15. Counterparts. This Agreement may be executed by any one or more of the parties hereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return one to each of J.P. Morgan Securities Inc. and Salomon Smith Barney Inc., plus one for our counsel a counterpart hereof, whereupon this letter shall constitute a binding agreement between each of the Underwriters and the Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters is pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination upon request, but without warranty on your part as to the authority of the signers thereof. Very truly yours, Delta Air Lines, Inc. By: ------------------------------------- Name: James W. Whitehurst Title: Senior Vice President-Finance, Treasury and Business Development Accepted as of the date hereof: J.P. Morgan Securities Inc. By: -------------------------------- Name: Title: Salomon Smith Barney Inc. By: -------------------------------- Name: Title: SCHEDULE I to Underwriting Agreement
PRINCIPAL PRINCIPAL PRINCIPAL AMOUNT OF AMOUNT OF AMOUNT OF CLASS G-1 CLASS G-2 CLASS C UNDERWRITER CERTIFICATES CERTIFICATES CERTIFICATES - ----------- ------------------------ ----------------------- ------------------------ J.P. Morgan Securities Inc....................... $65,211,000.00 $41,150,000.00 $18,748,000.00 Salomon Smith Barney Inc......................... $65,210,000.00 $41,142,000.00 $18,742,000.00 Merrill Lynch, Pierce, Fenner & Smith $65,210,000.00 $41,142,000.00 $18,742,000.00 Incorporated Commerzbank Capital Markets Corp. $65,210,000.00 $41,142,000.00 $18,742,000.00 Mizuho International plc $65,210,000.00 $41,142,000.00 $18,742,000.00 SunTrust Capital Markets Inc. $65,210,000.00 $41,142,000.00 $18,742,000.00 Wachovia Securities, Inc. $65,210,000.00 $41,142,000.00 $18,742,000.00 KBC Financial Products USA Inc. $65,210,000.00 $41,142,000.00 $18,742,000.00 U.S. Bancorp Piper Jaffray Inc. $65,210,000.00 $41,142,000.00 $18,742,000.00 Total ........................................... $586,891,000.00 $370,286,000.00 $168,684,000.00
SCHEDULE II to Underwriting Agreement Class of Aggregate Final Expected Pass Through Principal Regular Distribution Certificates Amount Interest Rate Date - --------------------- ----------------- ---------------- ---------------------- 2002-1, Class G-1 $586,891,000 6.718% January 2, 2023 2002-1, Class G-2 $370,286,000 6.417% July 2, 2012 2002-1, Class C $168,684,000 7.779% January 2, 2012 EXHIBIT A to Underwriting Agreement FORM OF BINGHAM DANA LLP OPINION, COUNSEL FOR STATE STREET April 30, 2002 TO THE PARTIES SET FORTH IN SCHEDULE A HERETO RE: Delta Air Lines, Inc. 2002-1 Pass Through Trusts Pass Through Trust Certificates, Series 2002-1 (Underwriting Agreement Opinion) Ladies and Gentlemen: We have acted as special counsel for State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity ("State Street") and as (i) Pass Through Trustee (the "Pass Through Trustee") under the Pass Through Trust Agreement dated as of November 16, 2000, between Delta Air Lines, Inc. ("Delta") and State Street (the "Basic Agreement"), as supplemented by Trust Supplement No. 2002-lG-1, Trust Supplement No. 2002-1G-2 and Trust Supplement No. 2002-1C, each dated as of April 30, 2002 and each between Delta and State Street (collectively, the "Offered Trust Supplements") in connection with the transactions contemplated by the Underwriting Agreement dated April 23, 2002 (the "Underwriting Agreement") by and among Delta and J.P. Morgan Securities Inc., Salomon Smith Barney Inc. and other underwriters named therein (the "Underwriters"); (ii) Pass Through Trustee under the Basic Agreement as supplemented by Trust Supplement No. 2002-1D, dated as of April 30, 2002, between Delta and State Street (the "Class D Trust Supplement", and the Basic Agreement, as supplemented by a Trust Supplement or Class D Trust Supplement, a "Designated Agreement"); (iii) Loan Trustee under the Owned Aircraft Indentures and Owned Aircraft Participation Agreements; and (iv) Subordination Agent under the Intercreditor Agreement, the Liquidity Facilities, the Participation Agreements and the Policy Provider Agreement. Capitalized terms not otherwise defined herein shall have the meanings specified in or referenced in the Underwriting Agreement. This opinion is being delivered pursuant to Section 4(b)(3) of the Underwriting Agreement. Our representation of State Street in its individual capacity and as Pass Through Trustee, Subordination Agent, Loan Trustee and Paying Agent has been as special counsel for the limited purposes stated above. As to all matters of fact (including factual conclusions and characterizations and descriptions of purpose, intention or other state of mind), we have relied, with your permission, entirely upon (i) the representations and warranties of the parties set forth in the Operative Documents (defined below) and (ii) certificates delivered to us by the management of State Street and have assumed, without independent inquiry, the accuracy of those representations, warranties and certificates. We have examined the Designated Agreements, the Liquidity Facilities, the Fee Letter, the Policies, the Policy Fee Letter, the Policy Provider Agreement, the Intercreditor Agreement, the Owned Aircraft Participation Agreements, the Owned Aircraft Indentures and the Business Trust Agreement, each of which (other than the Basic Agreement) is dated the date hereof (all such agreements, collectively, the "Operative Documents"), the Certificates, the Certificate of the Comptroller of the Currency relating to State Street and originals, or copies certified or otherwise identified to our satisfaction, of such other records, documents, certificates, or other instruments as we have deemed necessary or advisable for the purposes of this opinion. For purposes of our opinion rendered in paragraph 1 below, with respect to the authority of State Street to operate as a national banking association and exercise trust powers, our opinion relies upon and is limited by such Certificate of the Comptroller of the Currency. We have assumed the genuineness of all signatures (other than those on behalf of State Street, the Pass Through Trustee, the Subordination Agent, the Loan Trustee and the Paying Agent), the conformity to the originals of all documents reviewed by us as copies, and the authenticity and completeness of all original documents reviewed by us in original or copy form and the legal competence of each individual executing any document (other than those individuals executing documents on behalf of State Street, the Pass Through Trustee, the Subordination Agent, the Loan Trustee and the Paying Agent). When an opinion set forth below is given to the best of our knowledge, or to our knowledge, or with reference to matters of which we are aware or which are known to us, or with another similar qualification, the relevant knowledge or awareness is limited to the actual knowledge or awareness of the individual lawyers in the firm who have participated directly and substantively in the specific transactions to which this opinion relates and without any special or additional investigation undertaken for the purposes of this opinion. Subject to the limitations set forth below, we have made such examination of law as we have deemed necessary for the purposes of this opinion. The opinions set forth below are limited solely to the internal substantive laws of the State of Connecticut as applied by courts located in Connecticut without regard to choice of law and the federal laws of the United States, and we express no opinion as to the laws of any other jurisdiction. No opinion is given herein as to the choice of law or internal substantive rules of law that any court or other tribunal may apply to the transactions contemplated by the Operative Documents. Without limitation of the generality of the foregoing, no opinion is expressed herein as to the application or effect of federal securities laws or as to the securities or so-called "Blue Sky" laws of any state or other Jurisdiction. In addition, other than our opinion expressed in paragraph 1 below with respect to the citizenship of State Street, no opinion is expressed as to matters governed by any law, statute, rule or regulation of the United States relating to the acquisition, ownership, registration, use, operation, maintenance, repair, replacement or sale of or the nature of the Aircraft. We express no opinion as to the accuracy or completeness of any exhibits or schedules to the Operative Documents. To the extent to which this opinion deals with matters governed by or relating to the laws of the State of New York (by which the Operative Documents (other than the Business Trust Agreement) are stated to be governed), or other jurisdiction other than the State of Connecticut, we have assumed, with your permission that the Operative Documents are governed by the internal substantive laws of the State of Connecticut. Our opinion is further subject to the following exceptions, qualifications and assumptions: (a) We have assumed without any independent investigation that (i) each party to the Operative Documents, other than State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable, at all times relevant thereto, is validly existing and in good standing, under the laws of the jurisdiction in which it is organized, and is qualified to do business and in good standing, under the laws of each Jurisdiction where such qualification is required generally or necessary in order for such party to enforce its rights under such Operative Documents, and (ii) each party to the Operative Documents, at all times relevant thereto, had and has the full power, authority and legal right under its certificate of incorporation, partnership agreement, by-laws, and other governing organizational documents, and the applicable corporate, partnership, or other enterprise legislation and other applicable laws, as the case may be (other than State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent with respect to the laws of the United States of America and the internal substantive laws of the State of Connecticut, but only in each case to the limited extent the same may be applicable to State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, and relevant to our opinions expressed below) to execute, and to perform its obligations under, the Operative Documents, and (iii) each party to the Operative Documents (other than State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable) has duly executed and delivered each of such agreements and instruments to which it is a party and that (other than with respect to State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable) the execution and delivery of such Operative Documents and the transactions contemplated thereby have been duly authorized by proper corporate or other organizational proceedings as to such party. (b) We have assumed without any independent investigation that each of the Operative Documents is a valid, binding and enforceable obligation of each party thereto other than State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable. (c) The enforcement of any obligations of State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable, under any of the Operative Documents may be limited by the receivership, conservatorship and supervisory powers of bank regulatory agencies generally, as well as by bankruptcy, insolvency, reorganization, moratorium, marshaling or other laws and rules of law affecting the enforcement, generally of creditors' rights and remedies (including such as may deny giving effect to waivers of debtors' or guarantors' rights); and we express no opinion as to the status under any fraudulent conveyance laws or fraudulent transfer laws of any of the obligations of State Street, the Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as applicable, under any of the Operative Documents. (d) We express no opinion as to the availability of any specific or equitable relief of any kind. (e) The enforcement of any of your rights may in all cases be subject to an implied duty of good faith and fair dealing and to general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity) and, as to any of your rights to collateral security, will be subject to a duty to, act in a commercially reasonable manner. (f) We express no opinion as to the enforceability of any particular provision of any of the Operative Documents relating to (i) waivers of rights to object to jurisdiction or venue, or consents to jurisdiction or venue, (ii) waivers of rights to (or methods of) service of process, or rights to trial by jury, or other rights or benefits bestowed by operation of law, (iii) waivers of any applicable defenses, setoffs, recoupments, or counterclaims, (iv) the grant of powers of attorney to any person or entity, (v) exculpation or exoneration clauses, indemnity clauses, and clauses relating to releases or waivers of unmatured claims or rights, (vi) the imposition or collection of interest on overdue interest or providing for a penalty rate of interest or late charges on overdue or defaulted obligations, or the payment of any premium, liquidated damages, or other amount which may be held by any court to be a penalty" or a "forfeiture," or (vii) so-called "usury savings clauses" purporting to specify methods of (or otherwise assure) compliance with usury laws or other similar laws of any jurisdiction. (g) We express no opinion as to the effect of events occurring, circumstances arising, or changes of law becoming effective or occurring, after the date hereof on the matters addressed in this opinion letter, and we assume no responsibility to inform you of additional or changed facts, or changes in law, of which we may become aware. (h) No opinion is given herein as to the effect of usury laws (or other similar laws) of any jurisdiction with respect to the Operative Documents. In rendering the opinion set forth below in paragraph 6 as to certain Connecticut tax matters, we have assumed that, for federal income tax purposes, none of the Pass Through Trusts will be taxable as a corporation, but, rather, each will be classified as a grantor trust under subpart E, Part I of Subchapter J of Chapter I of Subtitle A of the Internal Revenue Code of 1986, as amended, or as a partnership. This opinion is rendered solely for the benefit of those institutions listed on Schedule I hereto and their successors and assigns in connection with the transactions contemplated by the Operative Documents and may not be used or relied upon by any other person or for any other purpose. Based upon the foregoing and subject to the limitations and qualifications set forth herein, we are of the opinion that: 1. State Street is a national banking association, validly formed and existing and authorized to operate as a national banking association under the laws of the United States of America is a "citizen of the United States" within the meaning of Section 40102(a)(15) of Title 49 of the United States Code, and, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent as the case may be, has the requisite corporate and trust power and authority to execute, deliver and perform its obligations under the Operative Documents and in its capacity as Pass Through Trustee, to issue, execute, deliver and authenticate the Offered Certificates delivered on the date herewith. 2. State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, has duly authorized by all necessary corporate or trust action the Operative Documents and has duly executed and delivered the Operative Documents, and the Operative Documents constitute valid and binding obligations of State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, enforceable against State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, in accordance with their respective terms. 3. The Certificates issued and dated on the date hereof have been duly authorized and validly executed, issued, authenticated and delivered by State Street as Pass Through Trustee pursuant to the terms of the Operative Documents and are valid and binding obligations of the Pass Through Trustee, enforceable against the Pass Through Trustee in accordance with their terms, and the holders of the Certificates are entitled to the benefits of the applicable Designated Agreements. 4. The authorization, execution, delivery and performance by State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, of the Operative Documents and the consummation of the transactions therein contemplated and compliance with the terms thereof' and the issuance of the Certificates thereunder do not and will not result in the violation of the provisions of the charter documents or by-laws of State Street and, to the best of our knowledge, do not conflict with, or result in a breach of any terms or provisions of, or constitute a default under, or result in the creation or the imposition of any lien, charge or encumbrance upon any property or assets of State Street in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent under any indenture, mortgage or other agreement or instrument, in each case known to us, to which State Street in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent is a party or by which it or any of its properties is bound, or violate any applicable Connecticut or federal law, rule or regulation governing State Street's banking or trust powers, or, to the best of our knowledge, of any judgment, license, registration, permit, order or decree, in each case known to us, applicable to State Street in its individual capacity, or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent of any court, regulatory body, administrative agency, government or Governmental body having jurisdiction over State Street in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent. 5. No authorization, approval, consent, license or order of, giving of notice to, registration with, or taking of any other action in respect of, any federal or state governmental authority or agency pursuant to any federal or Connecticut law governing the banking or trust powers of State Street is required for the authorization, execution, delivery and performance by State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, of the Operative Documents, the issuance of the Certificates or the consummation of any of the transactions by State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, contemplated thereby (except as shall have been duly obtained, given or taken); and such authorization, execution, delivery, performance, consummation and issuance do not conflict with or result in a breach of the provisions of any such law. 6. There are no taxes, fees or other governmental charges ("Taxes") payable under the laws of the State of Connecticut or any political subdivision or taxing authority thereof with respect to the execution or delivery by State Street, in its individual capacity or as Pass Through Trustee, as the case may be, of any of the Operative Documents or the issuance, execution and delivery of the Certificates by the Pass Through Trustee pursuant to the Designated Agreements, or the purchase of the relevant Equipment Notes by the Pass Through Trusts and (i) neither the Pass Through Trusts, nor the trust properties thereof, nor the Pass Through Trustee (in its capacity as trustee) will be subject to any Tax (including without limitation, net or gross income, tangible or intangible property, net worth, capital, franchise or doing business tax), imposed by the State of Connecticut or any political subdivision or taxing authority thereof, and (ii) Certificate Owners (as defined in the Basic Agreement) that are not residents of or otherwise subject to tax in Connecticut will not be subject to any Tax (including, without limitation, net or gross income, tangible or intangible property, net worth, capital, franchise or doing business tax), imposed by the State of Connecticut or any political subdivision or taxing authority thereof as a result of purchasing, owning (including receiving payments with respect to) or selling a Certificate. 7. There are no Taxes payable under the laws of the State of Connecticut, or any political subdivision of either such State with respect to the execution and delivery by State Street, in its individual capacity or as Subordination Agent or Loan Trustee, as the case may be, of the Operative Documents or in connection with the issuance, authentication or delivery of the Equipment Notes. There are no applicable Taxes under the laws of the State of Connecticut or any political subdivision of such State or Commonwealth (other than taxes imposed on the fees received by State Street for acting as Pass Through Trustee, Loan Trustee under the Indentures or as Subordination Agent) upon or with respect to (a) the construction, mortgaging, financing, refinancing, purchase, acquisition, acceptance, rejection, delivery, nondelivery, transport, location, ownership, insurance, control, registration, reregistration, deregistration, assembly, possession, repossession, operation, use, condition, maintenance, repair, sale, return, abandonment, replacement, preparation, installation, storage, redelivery, manufacture, leasing, subleasing, modification, rebuilding, importation, transfer of title, transfer of registration, exportation or other application or disposition of the Aircraft, any Engine or any Part or any interest in any thereof, (b) any amount paid or payable pursuant to any Operative Document, (c) the Aircraft, any Engine or any Part or any interest therein, (d) any or all of the Operative Documents, any or all of the Equipment Notes or any interest in any or all thereof or the offering, registration, reregistration, issuance, acquisition, modification, assumption, reissuance, refinancing or refunding of any or all thereof, and any other documents contemplated hereby or thereby and amendments and supplements hereto and thereto, (e) the payment of the principal of, or interest or premium on, or other amounts payable with respect to, any or all of the Equipment Notes, whether as originally issued or pursuant to any refinancing, refunding, assumption, modification or reissuance, or any other obligation evidencing any loan in replacement of the loan evidenced by any or all of the Equipment Notes, (f) the property, or the income, earnings, receipts or other proceeds received with respect to the property, held by the Loan Trustee under the Indenture or by the Subordination Agent under the Intercreditor Agreement, or (g) otherwise with respect to or in connection with the transactions contemplated by the Operative Documents, which would not have been imposed if neither the Loan Trustee nor the Subordination Agent had its principal place of business in, had performed any or all of its administrative duties under the Operative Documents in, and had engaged in any activities unrelated to the transactions contemplated by the Operative Documents in, the State of Connecticut. 8. To our knowledge, but without having investigated any governmental records or court dockets, and without having made any other independent investigation, there are no proceedings pending or overtly threatened in writing against or affecting State Street in any court or before any governmental authority, agency, arbitration board or tribunal which, if adversely determined, individually or in the aggregate, could reasonably be expected to affect materially and adversely the Pass Through Trusts or affect the right, power and authority of State Street, in its individual capacity or as Pass Through Trustee, Subordination Agent, Loan Trustee or Paying Agent, as the case may be, to enter into or perform its obligations under the Operative Documents or to issue the Certificates. 9. The statements in the Registration Statement and Prospectus under the caption "Certain Connecticut Taxes", to the extent that they constitute matters of law or legal conclusions with respect thereto, have been reviewed by us and are correct in all material respects. Very truly yours, BINGHAM DANA LLP SCHEDULE A TO EXHIBIT A State Street Bank and Trust Company of Connecticut, National Association Delta Air Lines, Inc. Standard & Poor's Ratings Services Moody's Investors Service, Inc. J.P. Morgan Securities Inc. Salomon Smith Barney Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated Commerzbank Capital Markets Corp. Mizuho International plc SunTrust Capital Markets Inc. Wachovia Securities, Inc. KBC Financial Products USA Inc. U.S. Bancorp Piper Jaffray Inc. Cadwalader, Wickersham & Taft EXHIBIT B to Underwriting Agreement FORM OF OPINION OF IN-HOUSE COUNSEL FOR THE LIQUIDITY PROVIDER Based upon the foregoing and in connection with the obligations of [Liquidity Provider] under the Documents, we are of the opinion that insofar as the laws of Germany are concerned: 1. [Liquidity Provider] is a public law institution with full legal capacity (rechtsfahige Anstalt des offentlichen Rechts), is duly established under the Treaty on the Formation of a Joint Savings Banks Organization [ ] (Staatsvertrag uber die Bildung einer gemeinsamen Sparkassenorganisation), validly exists as a credit institution under the laws of Germany with unlimited corporate existence and has the corporate power and authority to execute and deliver, and perform its obligations under, the Documents. 2. [Liquidity Provider] has the power to enter into the Documents which are duly executed on behalf of [Liquidity Provider] when signed by the following two officers of [Liquidity Provider]: [ ] and [ ]. 3. the obligations of [Liquidity Provider] under the Documents are legal, valid, binding and enforceable against [Liquidity Provider] in accordance with their respective terms, except to the extent that enforcement may be limited by equitable principles and applicable bankruptcy, insolvency, re-organization, moratorium or other similar laws affecting creditors' rights generally. 4. it is not necessary that any of the Documents be filed, recorded or enrolled with any public office, governmental authority or court in Germany in order to ensure the legality or validity of the Documents in Germany. 5. no consent or approval of any governmental or public bodies or authorities or courts of Germany is required by [Liquidity Provider] in connection with the execution and delivery of the Documents and the performance by [Liquidity Provider] of its obligations under the Documents. 6. the execution, delivery and performance of the Documents does not violate any law of Germany applicable to [Liquidity Provider] and does not contravene any of [Liquidity Provider]'s organizational documents. 7. the choice of the law of the State of New York to govern the obligations of the parties under the Documents will be upheld as a valid choice of law in any action brought in connection with the Documents the courts of Germany against [Liquidity Provider] and the submission by [Liquidity Provider] to the non-exclusive 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 under such Documents is binding on it. 8. any final and conclusive judgment rendered b the Supreme Court of the State of New York or by the United States District Court for the Southern District of New York for a definite sum for the recovery of amounts due and unpaid by [Liquidity Provider] under the Revolving Credit Agreement (2002-G-1), the Revolving Credit Agreement (2002-G-2) and the Revolving Credit Agreement (2002-C-1), will be enforceable against [Liquidity Provider] in Germany subject to the applicable rules for obtaining a necessary executory decision (action upon the foreign judgment) issued by a competent German court. Such a decision will not be rendered if any of the reasons for excluding enforceability set out in Section 328 (1) of the German Code of Civil Procedure (ZPO) is present, in particular, if: (a) under German law the said state or federal court did not have jurisdiction; (b) [Liquidity Provider] has not been served with process in a proper and timely fashion and has not defended itself against the claim in court; (c) the judgment conflicts with a prior judgment of a German court or a prior judgment of a foreign court which is to be recognized in Germany, or the litigation resulting in the judgment to be enforced conflicts with litigation previously commenced in Germany; (d) recognition of the judgment would clearly be contrary to basic principles of German law, in particular the constitutional human rights (Grundrechte); or (e) reciprocity is not insured. 9. the payment obligations of [Liquidity Provider] under the Revolving Credit Agreement (2002-G-1), the Revolving Credit Agreement (2002-G-2) and the Revolving Credit Agreement (2002-C-1) and the Revolving Credit Agreement (2001-1-C), rank pari passu with its obligations to pay any other unsecured and unprivileged obligations of [Liquidity Provider] for borrowed money that are not preferred by contractual stipulations or by law or in proceedings under the German Composition Code (Vergleichsordnung) or Bankruptcy Code (Konkursordnung) or Insolvency Code (Insolvenzordnung) or by similar laws affecting creditors' rights generally. EXHIBIT C to Underwriting Agreement FORM OF OPINION OF COUNSEL FOR THE LIQUIDITY PROVIDER 1. The Liquidity Facilities and the Intercreditor Agreement (the "Liquidity Documents") constitute the valid and legally binding agreements of the parties thereto, enforceable against each party thereto in accordance with their respective terms. 2. The execution, delivery and performance by the Liquidity Provider of the Liquidity Documents and the consummation of the transactions contemplated therein do not violate any banking law, or any governmental rule or regulation relating thereto, of the United States of America or the State of New York. 3. No authorization, consent, approval or other action by, and no notice to or filing with, any banking authority or regulatory body of the United States of America or the State of New York is required for the due execution, delivery and performance by the Liquidity Provider of the Liquidity Documents, as the case may be other than administrative and ministerial filings which the Liquidity Provider is obligated to make in the ordinary course of its business. EXHIBIT D FORM OF OPINION OF IN-HOUSE COUNSEL TO THE POLICY PROVIDER (i) MBIA is a corporation validly existing, in good standing and licensed to transact the business of surety and financial guaranty insurance under the laws of the State of New York. (ii) MBIA has the corporate power to execute and deliver, and to take all action required of it under the Policies, the Policy Provider Agreement, the Indemnification Agreement and the Intercreditor Agreement. (iii) The execution, delivery or performance by MBIA of the Policies, the Policy Provider Agreement, the Indemnification Agreement and the Intercreditor Agreement (the "Relevant Documents"), the consummation of the transactions contemplated therein and the compliance with the Policies will not, and the satisfaction of the terms or provisions thereof does not and will not (a) violate any law of the State of New York or any federal laws of the United States, statute or any order, writ, injunction, or decree of which I am aware of any court or governmental authority or body to which MBIA or any of its properties may be subject, (b) conflicts or will conflict with or results or will result in any breach of any of the terms or provisions of, or constitutes or will constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property of MBIA under, any contract, agreement or instrument to which MBIA is a party or by which it or any of its property or assets is bound or (c) violates or will violate the charter or by-laws of MBIA. (iv) There is no pending or, to the best of my knowledge, threatened, action, suit, proceeding, inquiry or investigation to which MBIA is a party, before or brought by any court or governmental agency or body, domestic or foreign, which might reasonably be expected to materially or adversely affect the validity or enforceability of the Policies. (v) The MBIA documents incorporated by reference, or any amendment or supplement thereto made by MBIA before April 30, 2002 (the "Closing Date"), in the Prospectus Supplement dated April 22, 2002 to the Delta Air Lines, Inc. Prospectus dated July 23, 2001 (the "Prospectus Supplement"), complied as to form in all material respects with the requirements of the Securities Exchange Act of 1934, as amended and the rules and regulations of the Securities and Exchange Commission thereunder. (vi) The information with respect to MBIA in the section of the Prospectus Supplement entitled "Description of the Policy Provider" does not purport to provide the scope of disclosure required to be included by the Securities Act of 1933, as amended, with respect to a registrant in connection with the offer and sale of securities of such registrant. However, I have no reason to believe that as of April 23, 2002 or the Closing Date, the above referenced section contained or contains any untrue statement of material fact or omitted or omits to state any material fact required to be stated therein, in light of the circumstances under which they were made, not misleading. (vii) The Policies are not required to be registered under the Securities Act of 1933, as amended. EXHIBIT E FORM OF OPINION OF COUNSEL TO THE POLICY PROVIDER (i) Except as have already been obtained, no authorization, consent, approval, license, formal exemption, or declaration from, nor any registration or filing with, any court or governmental agency or body of the United States of America or the State of New York, which if not obtained would affect or impair the validity or enforceability of the Policies, the Policy Provider Agreement, the Indemnification Agreement or the Intercreditor Agreement against MBIA, is required in connection with the execution and delivery by MBIA of the Policies, the Policy Provider Agreement, the Indemnification Agreement, the Intercreditor Agreement or in connection with MBIA's performance of its obligations thereunder. (ii) The Policies, the Policy Provider Agreement, the Indemnification Agreement and the Intercreditor Agreement have been duly authorized, executed and delivered by MBIA, and the Policies and, assuming due authorization, execution and delivery of the Policy Provider Agreement, the Indemnification Agreement and the Intercreditor Agreement by the parties thereto (other than MBIA), the Policy Provider Agreement, the Indemnification Agreement and the Intercreditor Agreement, constitute the legally valid and binding obligations of MBIA, enforceable against MBIA in accordance with their respective terms subject, as to enforcement, to (a) bankruptcy, reorganization, insolvency, moratorium and other similar laws relating to or affecting the enforcement of creditors' rights generally, including, without limitation, laws relating to fraudulent transfers or conveyances, preferential transfers and equitable subordination, presently or from time to time in effect and general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law), as such laws may be applied in any such proceeding with respect to MBIA, (b) the qualification that the remedy of specific performance may be subject to equitable defenses and to the discretion of the court before which any proceedings with respect thereto may be brought, and (c) the enforceability of rights to indemnification under the Indemnification Agreement may be subject to limitations of public policy under applicable securities laws. EXHIBIT F to Underwriting Agreement FORM OF OPINION OF RICHARDS, LAYTON & FINGER, PA, SPECIAL DELAWARE COUNSEL TO THE INITIAL CLASS D HOLDER April 30, 2002 To The Parties Listed On Schedule A Attached Hereto Re: Delta Air Lines, Inc. Class D Certificate Trust Ladies and Gentlemen: We have acted as special Delaware counsel to Delta Air Lines, Inc. Class D Certificate Trust (the "Trust"), a Delaware business trust existing pursuant to the Trust Agreement, dated as of April 30, 2002 (the "Trust Agreement"), between Delta Air Lines, Inc. ("Delta") and Wilmington Trust Company, as trustee (the "Trustee"). This opinion is being delivered pursuant to Section 4(b)(8) of the Underwriting Agreement dated April 23, 2002 between Delta and certain underwriters named therein. Capitalized terms used herein and not otherwise defined are used as defined in, or by reference in, the Trust Agreement, except that reference herein to any document shall mean such document as in effect on the date hereof. We have examined originals or copies of the following documents: (a) The Trust Agreement; (b) A certified copy of the certificate of trust (the "Certificate of Trust") of the Trust, which was filed with the Secretary of State of the State of Delaware (the "Secretary of State") on April [ ], 2002; and (c) A certificate of good standing, dated April [ ], 2002, obtained from the Secretary of State with respect to the Trust. For purposes of this opinion, we have not reviewed any documents other than the documents listed in paragraphs (a) through (c) above. In particular, we have not reviewed any document (other than the documents listed in paragraphs (a) through (c) above) that is referred to in or incorporated by reference into the documents reviewed by us. We have assumed that there exists no provision in any document that we have not reviewed that is inconsistent with the opinions stated herein. We have conducted no independent factual investigation of our own but rather have relied solely upon the foregoing documents, the statements and information set forth therein and the additional matters recited or assumed herein, all of which we have assumed to be true, complete and accurate in all material respects. With respect to all documents examined by us, we have assumed (i) the authenticity of all documents submitted to us as authentic originals, (ii) the conformity with the originals of all documents submitted to us as copies or forms, and (iii) the genuineness of all signatures. For purposes of this opinion, we have assumed (i) that the Trust Agreement constitutes the entire agreement among the parties thereto with respect to the subject matter thereof, including with respect to the creation, operation, and termination of the Trust, and that the Trust Agreement and the Certificate of Trust have not been amended, (ii) except to the extent provided in paragraph 1 below, the due creation, due formation or due organization, as the case may be, and valid existence in good standing of each party to the documents examined by us under the laws of the jurisdiction governing its creation, formation or organization, (iii) the legal capacity of each natural person who is a party to the documents examined by us, (iv) except to the extent provided in paragraphs 1 and 2 below, that each of the parties to the documents examined by us has the power and authority to execute and deliver, and to perform its obligations under, such documents, (v) that each of the parties to the documents examined by us has duly authorized, executed and delivered such documents, (vi) that the Trust derives no income from or connected with sources within the State of Delaware and has no assets, activities (other than having a trustee as required by the Delaware Business Trust Act, 12 Del. C. ss. 3801 et seq. (the "Act") and filing documents with the Secretary of State) or employees in the State of Delaware and (vii) that the execution, delivery and performance of the documents examined by us by each of the parties thereto does not and will not violate or require any consent or approval of, the withholding of objection on the part of, the giving of notice to, the filing, registration or qualification with, or the taking of any other action under, any agreement, indenture or instrument to which it is a party or by which it is bound or any provision of any law, rule, regulation, judgment, order, writ, injunction or decree of any court or governmental authority applicable to it or any of its property. Based upon and subject to the foregoing and subject to the assumptions, qualifications and limitations set forth herein, it is our opinion that: 1. The Trust has been duly formed and is validly existing in good standing as a business trust under the Act, and has the power and authority under the Trust Agreement and the Act to own or hold its property. 2. The Trust Agreement constitutes a legal, valid and binding agreement of Delta and the Trustee, enforceable against Delta and the Trustee, in accordance with its terms. 3. Under ss. 3803(a) of the Act, Delta, in its capacity as a beneficial owner of the Trust, is entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the general corporation law of the State of Delaware, except to the extent otherwise provided in the Trust Agreement. 4. No creditor of Delta, in its capacity as a beneficial owner of the Trust, or any other beneficial owner of the Trust shall have any right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, the property of the Trust, except in accordance with the terms of the Trust Agreement, and such persons may not acquire any greater rights than Delta or any other beneficial owner might have with respect to the Trust Agreement. 5. Neither a Delaware court nor a federal court sitting in Delaware and applying federal law or Delaware law, if properly presented with the issue and after having properly considered such issue, would permit Delta to terminate the Trust Agreement, except in accordance with its terms or with the consent of the Class D Trustee and the Other Trustee. 6. The Trust is a separate legal entity and, insofar as the substantive law of the State of Delaware is applicable, the Trust rather than any beneficial owner of the Trust will hold whatever title to such property as may be conveyed to it from time to time pursuant to the Trust Agreement or otherwise, except to the extent that the Trust has taken action to dispose of or otherwise transfer or encumber any such property. 7. Under the Act and the Trust Agreement, no beneficial owner of the Trust (including, without limitation, Delta) will have a severable ownership interest in any individual asset of the Trust or any right of partition or possession thereof. The foregoing opinions may be subject to the following assumptions, exceptions and qualifications: A. The foregoing opinions are limited to the laws of the State of Delaware and, in the case of paragraph 5 above, Title 11 of the United States Code entitled "Bankruptcy" (the "Bankruptcy Code") that are currently in effect. We express no opinion with respect to (i) other federal laws, including, without limitation, the Securities Act of 1933, as amended, the Trust Indenture Act of 1939, as amended, the Investment Company Act of 1940, as amended, or the Federal Aviation Act of 1958, as amended, (ii) state securities or blue sky laws or (iii) laws relating to the particular nature of the Trust assets. B. The foregoing opinions regarding enforceability and the opinions in paragraphs 3, 4, 6 and 7 are subject to (i) applicable bankruptcy, insolvency, moratorium, reorganization, receivership, fraudulent transfer and similar laws affecting the rights and remedies of creditors generally, (ii) general principles of equity including applicable law relating to fiduciary duties (regardless of whether considered in a proceeding in equity or at law), and (iii) the effect of applicable public policy on the enforceability of provisions relating to indemnification or contribution. C. The opinion set forth in paragraph 5 is subject to, and we express no opinion with respect to, (i) applicable avoidance actions, e.g., fraudulent conveyance and preference laws (including ss. 547 and ss. 548 of the Bankruptcy Code) or (ii) principles of equity (regardless of whether considered and applied in a proceeding in equity or at law). D. We have not participated in the preparation of any offering materials with respect to assets to be held by the Trust and assume no responsibility for their contents. E. The opinion in paragraph 5 should be interpreted in accordance with the Special Report by The TriBar Opinion Committee, Opinions in the Bankruptcy Context: Rating Agency, Structured Financing and Chapter 11 Transactions, 46 Bus. Law. 717 (1991). This opinion may be relied upon by you in connection with the matters set forth herein, subject to the understanding that this opinion is given on the date hereof and only with respect to laws currently in effect. Otherwise, without our prior written consent, this opinion may not be furnished or quoted to, or relied upon by, any other person or entity for any purpose. Very truly yours, SCHEDULE A TO EXHIBIT F Delta Air Lines, Inc. State Street Bank and Trust Company of Connecticut, National Association Standard & Poor's Ratings Services Moody's Investors Service, Inc. J.P. Morgan Securities, Inc. Salomon Smith Barney Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated Commerzbank Capital Markets Corp. Mizuho International plc SunTrust Capital Markets Inc. Wachovia Securities, Inc. KBC Financial Products USA Inc. U.S. Bancorp Piper Jaffray Inc. EX-4.(A)(1) 3 de763576-ex4a1.txt TRUST SUP. NO. 2002-1G1 Exhibit 4(a)(1) TRUST SUPPLEMENT NO. 2002-1G-1 Dated as of April 30, 2002 between DELTA AIR LINES, INC. and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee, To PASS THROUGH TRUST AGREEMENT Dated as of November 16, 2000 Delta Air Lines, Inc. Pass Through Trust 2002-1G-1 6.718% Delta Air Lines Pass Through Certificates, Series 2002-1G-1 TRUST SUPPLEMENT NO. 2002-1G-1 This TRUST SUPPLEMENT NO. 2002-1G-1, dated as of April 30, 2002 (the "Trust Supplement"), between DELTA AIR LINES, INC., a Delaware corporation, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as Trustee, to the Pass Through Trust Agreement, dated as of November 16, 2000, between the Company (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01) and the Trustee (the "Basic Agreement"). W I T N E S S E T H: WHEREAS, the Basic Agreement, which is unlimited as to the aggregate face amount of Certificates that may be issued and authenticated thereunder, has heretofore or concurrently herewith been executed and delivered; WHEREAS, subject to clause (ii) of this recital, (i) pursuant to each Indenture with respect to an Aircraft owned by Delta at the time such Indenture is entered into (an "Owned Aircraft"), Delta will issue on a recourse basis four (or, in the case of a Boeing 737-832 Aircraft, three) series of Equipment Notes secured by such Aircraft and (ii) if an Aircraft becomes subject to a sale/leaseback transaction at any time after the date hereof (a "Leased Aircraft"), pursuant to an Indenture with respect to such Aircraft, as amended and restated in connection with such sale/leaseback transaction, the Owner Trustee will assume on a non-recourse basis Delta's obligations in respect of the Equipment Notes secured by such Aircraft, subject to re-optimization of such Equipment Notes (if such sale/leaseback transaction occurs prior to May 1, 2003); WHEREAS, the Trustee shall hereby declare the creation of the Class G-1 Trust (as defined below) for the benefit of Holders of the Class G-1 Certificates (as defined below) to be issued in respect of such Class G-1 Trust, and the initial Holders of the Class G-1 Certificates, as grantors of such Class G-1 Trust, by their respective acceptances of the Class G-1 Certificates, shall join in the creation of the Class G-1 Trust with the Trustee; WHEREAS, all Certificates to be issued by the Class G-1 Trust will evidence Fractional Undivided Interests in the Class G-1 Trust and will have no rights, benefits or interests in respect of any other separate Trust or the property held therein; WHEREAS, pursuant to the terms and conditions of the Basic Agreement, as supplemented by this Trust Supplement and the Participation Agreements, the Trustee on behalf of the Class G-1 Trust shall purchase the Equipment Notes issued by the Company pursuant to the Indentures relating to the Aircraft having the identical interest rate as, and final maturity dates not later than the final Regular Distribution Date of, the Class G-1 Certificates issued hereunder and shall hold such Equipment Notes in trust for the benefit of the Class G-1 Certificateholders; WHEREAS, pursuant to the terms and conditions of the Intercreditor Agreement referred to in Section 3.01(h) hereof (the "Intercreditor Agreement"), the Trustee and the other parties thereto will agree to the terms of subordination set forth therein; WHEREAS, all of the conditions and requirements necessary to make this Trust Supplement, when duly executed and delivered, a valid, binding and legal instrument in accordance with its terms and for the purposes herein expressed, have been done, performed and fulfilled, and the execution and delivery of this Trust Supplement in the form and with the terms hereof have been in all respects duly authorized; WHEREAS, this Trust Supplement is subject to the provisions of the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions; NOW THEREFORE, in consideration of the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. Unless otherwise specified herein or the context otherwise requires, capitalized terms used but not defined herein shall have the respective meanings set forth, and shall be construed and interpreted in the manner described, in the Basic Agreement or, to the extent not defined therein, in the Intercreditor Agreement. Section 1.02 Amended Definitions. For purposes of the Class G-1 Trust, the definitions of the following capitalized terms as specified heretofore in Section 1.01 of the Basic Agreement shall be amended to read as follows: "Pool Balance: means, with respect to the Class G-1 Certificates as of any date, (i) the original aggregate face amount of the Class G-1 Certificates less (ii) the aggregate amount of all distributions made in respect of the Class G-1 Certificates other than distributions made in respect of interest or premium or reimbursement of any costs or expenses incurred in connection therewith. The Pool Balance as of any Regular Distribution Date or Special Distribution Date shall be computed after giving effect to the payment of principal, if any, on the Series G-1 Equipment Notes or other Trust Property held in the Class G-1 Trust and the distribution thereof to be made on such date and payments under the Policy made for the benefit of the Class G-1 Certificateholders (other than in respect of the Liquidity Facilities and interest on the Class G-1 Certificates)." "Trust Property: means, with respect to the Class G-1 Trust, (i) subject to the Intercreditor Agreement, the Series G-1 Equipment Notes held as the property of the Class G-1 Trust, all monies at any time paid thereon and all monies due and to become due thereunder, (ii) funds from time to time deposited in the Certificate Account and the Special Payments Account, each for the Class G-1 Trust, and, subject to the Intercreditor Agreement, any proceeds from the sale by the Trustee pursuant to Article VI of the Basic Agreement of any Series G-1 Equipment Note referred to in (i) above, (iii) all rights of the Class G-1 Trust and the Trustee, on behalf of the Class G-1 Trust, under the Intercreditor Agreement or Class G-1 Liquidity Facility, including, without limitation, all rights to receive all monies and other property payable thereunder, (iv) all monies or other property receivable under the Intercreditor Agreement or the Class G-1 Liquidity Facility and (v) all monies or other property payable to the Trustee on behalf of the Class G-1 Trust pursuant to the Policy." ARTICLE II DECLARATION OF TRUST Section 2.01 Declaration of Trust. The Trustee hereby declares the creation of a Trust, designated the "Delta Air Lines Pass Through Trust 2002-1G-1" (the "Class G-1 Trust"), for the benefit of the Holders of the Class G-1 Certificates to be issued in respect of such Class G-1 Trust, and the initial Holders of the Class G-1 Certificates, as grantors of such Class G-1 Trust, by their respective acceptances of the Class G-1 Certificates, join in the creation of such Class G-1 Trust with the Trustee. The Trustee, by the execution and delivery of this Trust Supplement, acknowledges its acceptance of all right, title and interest in and to the Trust Property to be acquired pursuant to Section 2.02 of the Basic Agreement and the Participation Agreements and the Trustee will hold such right, title and interest for the benefit of all present and future Holders of the Class G-1 Certificates, upon the trusts set forth in the Basic Agreement and this Trust Supplement. ARTICLE III THE CERTIFICATES Section 3.01 The Certificates. There is hereby created a series of Certificates to be issued under this Agreement designated as "6.718% Delta Air Lines Pass Through Certificates, Series 2002-1G-1" (the "Class G-1 Certificates"). Each Class G-1 Certificate represents a Fractional Undivided Interest in the Class G-1 Trust created hereby. The Class G-1 Certificates shall be the only instruments evidencing a Fractional Undivided Interest in the Class G-1 Trust. The terms and conditions applicable to the Class G-1 Certificates and the Class G-1 Trust are as follows: (a) The aggregate face amount of the Class G-1 Certificates that may be authenticated and delivered under this Agreement (except for Class G-1 Certificates authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Class G-1 Certificates pursuant to Sections 3.03, 3.04, 3.05 and 3.06 of the Basic Agreement) is $586,891,000. (b) The Cut-off Date is May 28, 2002. (c) The Regular Distribution Dates with respect to any payment of Scheduled Payments means January 2 and July 2 of each year, commencing on January 2, 2003, until payment of all of the Scheduled Payments to be made under the Equipment Notes has been made. The principal amount of the Equipment Notes to be held by the Class G-1 Trust is scheduled for payment on January 2 and July 2 in certain years, beginning on January 2, 2003 and ending on January 2, 2023, as set out in Schedules I-A and I-B. (d) The Special Distribution Dates with respect to the Class G-1 Certificates means any Business Day on which a Special Payment is to be distributed pursuant to this Agreement. (e) The Class G-1 Certificates shall be in the form attached hereto as Exhibit A, shall be Book-Entry Certificates and shall be subject to the conditions set forth in the Letter of Representations between the Company and The Depository Trust Company, as initial Clearing Agency, attached hereto as Exhibit B. (f) The proceeds of the Class G-1 Certificates issued by the Class G-1 Trust shall be used to acquire the Equipment Notes described in Schedule II, such Equipment Notes to relate to the Aircraft described in Schedule III and the Note Documents described in Schedule IV. (g) Any Person acquiring or accepting a Class G-1 Certificate or an interest therein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase Class G-1 Certificates or an interest therein or (ii) the purchase and holding of Class G-1 Certificates or interests therein by such Person is exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. "Plan" means a retirement plan or other employee benefit plan or arrangement, including for this purpose an individual retirement account, annuity or Keogh plan, that is subject to Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal Revenue Code of 1986 (the "Code"), or such a plan or arrangement which is a foreign, church or governmental plan or arrangement exempt from Title I of ERISA and Section 4975 of the Code but subject to a foreign, federal, state, or local law which is substantially similar to the provisions of Title I of ERISA or Section 4975 of the Code (each, a "Similar Law"). (h) The Class G-1 Certificates will be subject to the following Intercreditor Agreement (and to the extent the terms thereof (including the definitions of defined terms) are inconsistent with the terms of this Agreement, such Intercreditor Agreement shall control): that certain Intercreditor Agreement, dated as of the date hereof, among State Street Bank and Trust Company of Connecticut, National Association, as Trustee under each Trust (as defined therein), MBIA Insurance Corporation, as the Policy Provider, Westdeutsche Landesbank Girozentrale, New York Branch, as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider and Class C Liquidity Provider, and State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent thereunder. Potential Purchasers shall have the rights upon the occurrence of a Triggering Event set forth in Article IV hereof. The Trustee and, by acceptance of any Class G-1 Certificate, each Certificateholder thereof, agrees to be bound by all of the provisions of the Intercreditor Agreement, including the subordination provisions of Section 9.09 thereof. (i) The Class G-1 Certificates will have the benefit of the following Liquidity Facility: that certain Revolving Credit Agreement, dated as of the date hereof, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent under the Intercreditor Agreement, as agent and trustee for the Class G-1 Trust, and Westdeutsche Landesbank Girozentrale, New York Branch. (j) Payments of interest on the Class G-1 Certificates when due and payment of the outstanding balance on the Class G-1 Certificates on the Final Legal Distribution Date for the Class G-1 Certificates and under certain other circumstances will be supported by a financial guaranty insurance policy to be issued by the Policy Provider under the Policy Provider Agreement, such policy, together with any policy issued in replacement thereof pursuant to the Intercreditor Agreement, in each case as amended, supplemented or otherwise modified from time to time in accordance with their respective terms, being the "Policy." (k) Subject to Section 2.02(b) of the Basic Agreement, there will not be any deposit agreement, escrow agreement or other similar arrangement prior to delivery of the Aircraft. (l) The Company may at any time purchase any of the Class G-1 Certificates at any price in the open market and may hold such Class G-1 Certificates to maturity. (m) The Responsible Party is the Company. Section 3.02 Delivery of Documents. The Trustee is hereby directed (i) to execute and deliver the Intercreditor Agreement referred to in Section 3.01(h) of this Trust Supplement and the Policy Provider Agreement, each in the form delivered to the Trustee by the Company and (ii) subject to the respective terms thereof, to perform its obligations thereunder. Section 3.03 Policy Provider Agreement. For purposes of this Trust Supplement, the representations and warranties of the Trustee set forth in Section 7.15(b), (c), (d) and (e) of the Basic Agreement shall be amended by adding the phrase "the Policy Provider Agreement" after each reference to "Intercreditor Agreement" therein. ARTICLE IV DEFAULT Section 4.01 Purchase Rights of Certificateholders. (a) By acceptance of its Class G-1 Certificate, each Class G-1 Certificateholder agrees that at any time after the occurrence and during the continuation of a Triggering Event, (i) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-2 Certificates pursuant to Section 4.01(a)(v) hereof, if the Class G-2 Trustee is then the Controlling Party, each Class G-1 Certificateholder shall have the right to purchase, for the purchase price set forth in the Class G-2 Trust Agreement, all, but not less than all, of the Class G-2 Certificates upon ten days' prior written notice to the Class G-2 Trustee and each other Class G-1 Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class G-1 Certificateholder notifies such purchasing Class G-1 Certificateholder that such other Class G-1 Certificateholder wants to participate in such purchase, then such other Class G-1 Certificateholder may join with the purchasing Class G-1 Certificateholder to purchase all, but not less than all, of the Class G-2 Certificates pro rata based on the Fractional Undivided Interest in the Class G-1 Trust held by each such Class G-1 Certificateholder and (B) if prior to the end of such ten-day period any other Class G-1 Certificateholder fails to notify the purchasing Class G-1 Certificateholder of such other Class G-1 Certificateholder's desire to participate in such a purchase, then such other Class G-1 Certificateholder shall lose its right to purchase the Class G-2 Certificates pursuant to this Section 4.01(a)(i); and (ii) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates pursuant to Section 4.01(a)(v) hereof, if the Trustee is then the Controlling Party, each Class G-2 Certificateholder shall have the right to purchase all, but not less than all, of the Class G-1 Certificates upon ten days' prior written notice to the Trustee and each other Class G-2 Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class G-2 Certificateholder notifies such purchasing Class G-2 Certificateholder that such other Class G-2 Certificateholder wants to participate in such purchase, then such other Class G-2 Certificateholder may join with the purchasing Class G-2 Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates pro rata based on the Fractional Undivided Interest in the Class G-2 Trust held by each such Class G-2 Certificateholder and (B) if prior to the end of such ten-day period any other Class G-2 Certificateholder fails to notify the purchasing Class G-2 Certificateholder of such other Class G-2 Certificateholder's desire to participate in such a purchase, then such other Class G-2 Certificateholder shall lose its right to purchase the Class G-1 Certificates pursuant to this Section 4.01(a)(ii); and (iii) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to Section 4.01(a)(v) hereof, each Class C Certificateholder shall have the right (which shall not expire upon any purchase of the Class G-1 Certificates or the Class G-2 Certificates pursuant to clause (i) or (ii) above) to purchase all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates upon ten days' prior written notice to the Trustee, the Class G-2 Trustee and each other Class C Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class C Certificateholder notifies such purchasing Class C Certificateholder that such other Class C Certificateholder wants to participate in such purchase, then such other Class C Certificateholder may join with the purchasing Class C Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates pro rata based on the Fractional Undivided Interest in the Class C Trust held by each such Class C Certificateholder and (B) if prior to the end of such ten-day period any other Class C Certificateholder fails to notify the purchasing Class C Certificateholder of such other Class C Certificateholder's desire to participate in such a purchase, then such other Class C Certificateholder shall lose its right to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to this Section 4.01(a)(iii); and (iv) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to Section 4.01(a)(v) hereof (it being understood that such purchase or election to purchase shall not affect the rights of the Class D Certificateholders with respect to the purchase of the Class C Certificates), each Class D Certificateholder (other than the Company or any of its Affiliates) shall have the right (which shall not expire upon any purchase of the Class G-1 Certificates or the Class G-2 Certificates pursuant to clause (i), (ii) or (iii) above) to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates upon ten days' prior written notice to the Trustee, the Class G-2 Trustee, the Class C Trustee and each other Class D Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class D Certificateholder notifies such purchasing Class D Certificateholder that such other Class D Certificateholder wants to participate in such purchase, then such other Class D Certificateholder may join with the purchasing Class D Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pro rata based on the Fractional Undivided Interest in the Class D Trust held by each such Class D Certificateholder and (B) if prior to the end of such ten-day period any other Class D Certificateholder fails to notify the purchasing Class D Certificateholder of such other Class D Certificateholder's desire to participate in such a purchase, then such other Class D Certificateholder shall lose its right to purchase the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pursuant to this Section 4.01(a)(iv); and (v) whether or not any Class G-1, Class G-2, Class C or Class D Certificateholders have exercised their rights pursuant to paragraphs (i), (ii), (iii) or (iv) above, the Policy Provider (except in the event of a Policy Provider Default), if it is then the Controlling Party, shall have the right to purchase all, but not less than all, of the (x) Class G-1 Certificates upon ten days' written notice to the Trustee and the holders of the Class G-1 Certificates and (y) the Class G-2 Certificates upon ten days' written notice to the Class G-2 Trustee and the holders of the Class G-2 Certificates. The purchase price with respect to the Class G-1 Certificates shall be equal to the Pool Balance of the Class G-1 Certificates, together with accrued and unpaid interest in respect thereof to the date of such purchase, without premium, but including any other amounts then due and payable to the Class G-1 Certificateholders under this Agreement, the Intercreditor Agreement or any Note Document or on or in respect of the Class G-1 Certificates; provided, however, that if such purchase occurs after the Record Date relating to any Distribution Date, such purchase price shall be reduced by the amount to be distributed hereunder on such related Distribution Date (which deducted amounts shall remain distributable to, and may be retained by, the Class G-1 Certificateholders as of such Record Date); provided, further that no such purchase of Class G-1 Certificates pursuant to clause (iii) or (iv) above shall be effective unless the purchaser(s) shall certify to the Trustee that contemporaneously with such purchase, such purchaser(s) is purchasing, pursuant to the terms of this Agreement and the Intercreditor Agreement, all of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates that are senior to the securities held by such purchaser(s), subject to the purchase rights of the Policy Provider provided in Section 4.01(a)(v) hereof. Each payment of the purchase price of the Class G-1 Certificates referred to in the first sentence hereof shall be made to an account or accounts designated by the Trustee and each such purchase shall be subject to the terms of this Section 4.01(a). Each Class G-1 Certificateholder agrees by its acceptance of its Certificate that it will, upon payment from such Class G-2 Certificateholder(s), Class C Certificateholder(s), Class D Certificateholder(s) or the Policy Provider, as the case may be, of the purchase price set forth in the first sentence of this paragraph, forthwith sell, assign, transfer and convey to the purchaser(s) thereof (without recourse, representation or warranty of any kind except as to its own acts) all of the right, title, interest and obligation of such Class G-1 Certificateholder in this Agreement, the Intercreditor Agreement, the Policy, the Policy Provider Agreement, the Class G-1 Liquidity Facility, the Note Documents and all Class G-1 Certificates held by such Class G-1 Certificateholder (excluding all right, title and interest under any of the foregoing to the extent such right, title or interest is with respect to an obligation not then due and payable as respects any action or inaction or state of affairs occurring prior to such sale) and the purchaser(s) shall assume all of such Class G-1 Certificateholder's obligations under this Agreement, the Intercreditor Agreement, the Policy, the Policy Provider Agreement, the Class G-1 Liquidity Facility, the Note Documents and all such Class G-1 Certificates. The Class G-1 Certificates will be deemed to be purchased on the date payment of the purchase price is made notwithstanding the failure of any Class G-1 Certificateholder to deliver any Class G-1 Certificate and, upon such a purchase, (i) the only rights of the Class G-1 Certificateholders will be to deliver the Class G-1 Certificates and (ii) if the purchaser(s) shall so request, each such Class G-1 Certificateholder will comply with all the provisions of Section 3.04 of the Basic Agreement to enable new Class G-1 Certificates to be issued to the purchaser(s) in such denominations as it shall request. All charges and expenses in connection with the issuance of any such new Class G-1 Certificates shall be borne by the purchaser(s) thereof. (b) This Section 4.01 supplements and, to the extent inconsistent with any provision of Section 6.01(a) of the Basic Agreement, replaces the provisions of Section 6.01(a) of the Basic Agreement. Notwithstanding anything to the contrary set forth herein or in any Operative Agreement, the provisions of this Section 4.01 may not be amended in any manner without the consent of each Class G-1 Certificateholder, Class G-2 Certificateholder, Class C Certificateholder or Class D Certificateholder (other than the Company or any of its Affiliates) that would be adversely affected thereby, or the Policy Provider, if it would be adversely affected thereby. ARTICLE V SUPPLEMENTAL AGREEMENTS Section 5.01 Supplemental Agreements. (a) For purposes of the Class G-1 Trust only, the following provisions of the Basic Agreement shall be amended as provided below. (i) Section 7.09(b) of the Basic Agreement shall be amended by inserting the phrase "the Policy Provider," immediately after each reference to "the Company" therein. (ii) Section 9.01 of the Basic Agreement shall be amended by adding the phrase "but with, in the case of clauses (2), (4), (5), (7) and (13) below, the consent of the Policy Provider" immediately after the phrase "Without the consent of any Certificateholders,". (iii) Section 9.01 of the Basic Agreement shall be amended by adding the phrase "the Policy and the Policy Provider Agreement," after each reference to "Intercreditor Agreement" therein (except for the second such reference in subparagraph (7) thereof). (iv) Section 9.02 of the Basic Agreement shall be amended by (A) adding the phrase "and upon the prior written consent of the Policy Provider" immediately after the phrase "by Direction of said Certificateholders delivered to the Company and the Trustee," appearing in the fifth line thereof and (B) by adding the phrase "the Policy Provider and" immediately after the phrase "provided, however, that no such agreement shall, without the consent of" appearing in the 13th line thereof. (v) Section 9.02 of the Basic Agreement shall be amended by (i) adding the phrase "the Policy and the Policy Provider Agreement," after each reference to "Intercreditor Agreement" therein (except for such reference in subparagraph (3) thereof) and (ii) adding the following as clause (6) thereof: "(6) terminate the Policy or modify the Policy other than amendments already contemplated or required by Section 3.06 of the Policy Provider Agreement." (vi) Section 9.04 of the Basic Agreement shall be amended by inserting the phrase "(which opinion shall also be addressed to the Policy Provider)" immediately before the period at the end of such Section. (vii) Section 10.01 of the Basic Agreement shall be amended by inserting at the beginning of the second sentence thereof the phrase "Subject to Section 8.01(b) of the Intercreditor Agreement (as defined in Trust Supplement No. 2002-1G-1 dated as of April 30, 2002),". (b) Promptly following (i) May 1, 2003 (the "Reoptimization Cut-off Date"), if there has been any change in the information set forth in clauses (x) and (y) below from that set forth in page S-32 of the Prospectus Supplement as a result of any sale/leaseback transaction with respect to any Boeing 737-832 Aircraft, and (ii) any early redemption or purchase of, or any default in the payment of principal or interest in respect of, any of the Series G-1 Equipment Notes held in the Class G-1 Trust, the Trustee shall furnish to Class G-1 Certificateholders of record on such date a statement setting forth (x) the expected Pool Factors for each subsequent Regular Distribution Date following the Reoptimization Cut-off Date and (y) the expected principal distribution schedule of the Series G-1 Equipment Notes, in the aggregate, held as Trust Property at the date of such notice. With respect to the Class G-1 Certificates registered in the name of a Clearing Agency, on the Reoptimization Cut-off Date, the Trustee will request from such Clearing Agency a securities position listing setting forth the names of all Clearing Agency Participants reflected on such Clearing Agency's books as holding interests in the Class G-1 Certificates on such date. The Trustee will mail to each such Clearing Agency Participant the statement described above and will make available additional copies as requested by such Clearing Agency Participant for forwarding to holders of interests in the Class G-1 Certificates. (c) The Trustee agrees to send to S&P (at its address at 55 Water Street, 39th Floor, New York, New York, 10041-0003, Attention: Philip A. Baggaley, or such other address as S&P may notify the Trustee) and the Policy Provider (at its address specified in the Intercreditor Agreement) a copy of each notice, statement, report or other written communication sent by the Trustee to each Class G-1 Certificateholder. ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.01 Final Termination Date. The respective obligations and responsibilities of the Company and the Trustee created hereby and the Class G-1 Trust created hereby shall terminate upon the distribution to all Certificateholders of Class G-1 Certificates and the Trustee of all amounts required to be distributed to them pursuant to this Agreement and the disposition of all property held as part of the Trust Property; provided, however, that in no event shall the Trust created hereby continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, Sr., the father of John F. Kennedy, former President of the United States, living on the date of this Trust Supplement. Section 6.02 Basic Agreement Ratified. Except and so far as herein expressly provided, all of the provisions, terms and conditions of the Basic Agreement are in all respects ratified and confirmed; and the Basic Agreement and this Trust Supplement shall be taken, read and construed as one and the same instrument. Section 6.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT AND THE CLASS G-1 CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 6.04 Counterparts. This Trust Supplement may be executed in any number of counterparts (and each of the parties shall not be required to execute the same counterpart). Each counterpart of this Trust Supplement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Trust Supplement, but all of such counterparts together shall constitute one instrument. Section 6.05 Intention of Parties. The parties hereto intend that the Class G-1 Trust be classified for United States federal income tax purposes as a grantor trust under Subpart E, Part I, Subchapter J, Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended, and not as a trust or association taxable as a corporation or as a partnership. Each Certificateholder of a Class G-1 Certificate, by its acceptance of its Class G-1 Certificate or a beneficial interest therein, agrees to treat the Class G-1 Trust as a grantor trust for all United States federal, state and local income tax purposes. The Trustee shall not be authorized or empowered to do anything that would cause the Class G-1 Trust to fail to qualify as a grantor trust for such tax purposes (including as subject to this restriction, acquiring any Aircraft by bidding the Equipment Notes relating thereto or otherwise, or taking any action with respect to any such Aircraft once acquired). IN WITNESS WHEREOF, the parties have caused this Trust Supplement to be duly executed by their respective officers thereto duly authorized as of the date first written above. DELTA AIR LINES, INC. By: ------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ------------------------------- Name: Title: EXHIBIT A to TRUST SUPPLEMENT NO. 2002-1G-1 FORM OF CERTIFICATE [*]Unless this Certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent for registration of transfer, exchange or payment, and any Certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. - -------------------------- [*] This legend to appear on Book-Entry Certificates to be deposited with The Depository Trust Company. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1G-1 6.718% DELTA AIR LINES PASS THROUGH CERTIFICATE, SERIES 2002-1G-1 Final Expected Regular Distribution Date: January 2, 2023 evidencing a fractional undivided interest in a Trust, the property of which includes or will include, among other things, certain Equipment Notes each secured by an Aircraft owned by Delta Air Lines, Inc. Certificate No. ______ $____________ Fractional CUSIP No. _______ Undivided Interest representing [ ]% of the Trust per $1,000 face amount THIS CERTIFIES THAT ________, for value received, is the registered owner of a $______ (______ dollars) Fractional Undivided Interest in the Delta Air Lines Pass Through Trust, Series 2002-1G-1 (the "Trust") created by STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as trustee (the "Trustee"), pursuant to a Pass Through Trust Agreement, dated as of November 16, 2000 (the "Basic Agreement"), as supplemented by Trust Supplement No. 2002-1G-1 thereto dated as of April 30, 2002 (collectively, the "Agreement"), between the Trustee and Delta Air Lines, Inc., a corporation incorporated under Delaware law (the "Company"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in the Agreement. This Certificate is one of the duly authorized Certificates designated as "6.718% Delta Air Lines Pass Through Certificates, Series 2002-1G-1" (herein called the "Certificates"). This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement. By virtue of its acceptance hereof, the Certificateholder of this Certificate assents to and agrees to be bound by all of the provisions of the Agreement and the Intercreditor Agreement, including the subordination provisions of Section 9.09 of the Intercreditor Agreement. The property of the Trust includes or will include certain Equipment Notes and all rights of the Trust and the Trustee, on behalf of the Trust, to receive any payments under the Intercreditor Agreement or the Liquidity Facility (the "Trust Property"). Each issue of the Equipment Notes is or will be secured by, among other things, a security interest in certain Aircraft owned by or leased to the Company. The Certificates represent Fractional Undivided Interests in the Trust and the Trust Property, and will have no rights, benefits or interest in respect of any other separate trust established pursuant to the terms of the Basic Agreement for any other series of certificates issued pursuant thereto. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, from funds then available to the Trustee, there will be distributed on each January 2 and July 2 (a "Regular Distribution Date"), commencing on January 2, 2003, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Regular Distribution Date, an amount in respect of the Scheduled Payments on the Equipment Notes due on such Regular Distribution Date, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Scheduled Payments. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, in the event that Special Payments on the Equipment Notes are received by the Trustee, from funds then available to the Trustee, there shall be distributed on the applicable Special Distribution Date, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Special Distribution Date, an amount in respect of such Special Payments on the Equipment Notes, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Special Payments so received. If a Regular Distribution Date or Special Distribution Date is not a Business Day, distribution shall be made on the immediately following Business Day with the same force and effect as if made on such Regular Distribution Date or Special Distribution Date and no interest shall accrue during the intervening period. The Trustee shall mail notice of each Special Payment and the Special Distribution Date therefor to the Certificateholder of this Certificate. Distributions on this Certificate will be made by the Trustee by check mailed to the Person entitled thereto, without the presentation or surrender of this Certificate or the making of any notation hereon, except that with respect to Certificates registered on the Record Date in the name of a Clearing Agency (or its nominee), such distributions shall be made by wire transfer. Except as otherwise provided in the Agreement and notwithstanding the above, the final distribution on this Certificate will be made after notice mailed by the Trustee of the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or agency of the Trustee specified in such notice. The Certificates do not represent a direct obligation of, or an obligation guaranteed by, or an interest in, the Company, the Trustee or any Loan Trustee or any Affiliate thereof. The Certificates are limited in right of payment, all as more specifically set forth on the face hereof and in the Agreement. All payments or distributions made to Certificateholders under the Agreement shall be made only from the Trust Property and only to the extent that the Trustee shall have sufficient income or proceeds from the Trust Property to make such payments in accordance with the terms of the Agreement. Each Certificateholder of this Certificate, by its acceptance hereof, agrees that it will look solely to the income and proceeds from the Trust Property to the extent available for any payment or distribution to such Certificateholder pursuant to the terms of the Agreement and that it will not have any recourse to the Company, any Owner Trustee, the Trustee or the Loan Trustees except as otherwise expressly provided in the Agreement, in any Note Document or in the Intercreditor Agreement. This Certificate does not purport to summarize the Agreement and reference is made to the Agreement for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby. A copy of the Agreement may be examined during normal business hours at the principal office of the Trustee, and at such other places, if any, designated by the Trustee, by any Certificateholder upon request. The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Certificateholders under the Agreement at any time by the Company and the Trustee with the consent of the Certificateholders holding Certificates evidencing Fractional Undivided Interests aggregating not less than a majority in interest in the Trust. Any such consent by the Certificateholder of this Certificate shall be conclusive and binding on such Certificateholder and upon all future Certificateholders of this Certificate and of any Certificate issued upon the transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Certificateholders of any of the Certificates. As provided in the Agreement and subject to certain limitations set forth therein, the transfer of this Certificate is registrable in the Register upon surrender of this Certificate for registration of transfer at the offices or agencies maintained by the Trustee in its capacity as Registrar, or by any successor Registrar duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Registrar, duly executed by the Certificateholder hereof or such Certificateholder's attorney duly authorized in writing, and thereupon one or more new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust will be issued to the designated transferee or transferees. The Certificates are issuable only as registered Certificates without coupons in minimum denominations of $1,000 Fractional Undivided Interest and integral multiples thereof except that one Certificate may be issued in a different denomination. As provided in the Agreement and subject to certain limitations therein set forth, the Certificates are exchangeable for new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust, as requested by the Certificateholder surrendering the same. No service charge will be made for any such registration of transfer or exchange, but the Trustee shall require payment of a sum sufficient to cover any tax or governmental charge payable in connection therewith. The Company, the Trustee, the Registrar and any Paying Agent shall deem and treat the person in whose name this Certificate is registered as the owner hereof for all purposes, and none of the Company, the Trustee, the Registrar or any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Agreement and the Trust created thereby shall terminate upon the distribution to Certificateholders of all amounts required to be distributed to them pursuant to the Agreement and the disposition of all property held as part of the Trust Property. Any Person acquiring or accepting this Certificate or an interest herein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either: (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase this Certificate or an interest herein or (ii) the purchase and holding of this Certificate or interest herein by such Person are exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. THIS CERTIFICATE AND THE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES AND CERTIFICATEHOLDERS HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Unless the certificate of authentication hereon has been executed by the Trustee, by manual signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose. IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1G-1 By: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ------------------------------- Title: Dated: FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Certificates referred to in the within-mentioned Agreement. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ------------------------------- Authorized Officer EXHIBIT B to TRUST SUPPLEMENT NO. 2002-1G-1 [DTC Letter of Representations] [Intentionally Omitted] N372DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 0.00 July 2, 2003 0.00 January 2, 2004 510,931.21 July 2, 2004 0.00 January 2, 2005 655,785.00 July 2, 2005 0.00 January 2, 2006 655,785.00 July 2, 2006 0.00 January 2, 2007 655,785.00 July 2, 2007 0.00 January 2, 2008 655,785.00 July 2, 2008 0.00 January 2, 2009 655,785.00 July 2, 2009 0.00 January 2, 2010 655,785.00 July 2, 2010 0.00 January 2, 2011 655,785.00 July 2, 2011 0.00 January 2, 2012 655,785.00 July 2, 2012 0.00 January 2, 2013 609,765.00 July 2, 2013 0.00 January 2, 2014 609,765.00 July 2, 2014 245,440.00 January 2, 2015 598,260.00 July 2, 2015 0.00 January 2, 2016 598,260.00 July 2, 2016 0.00 January 2, 2017 598,260.00 July 2, 2017 0.00 January 2, 2018 598,260.00 July 2, 2018 0.00 January 2, 2019 3,580,077.45 July 2, 2019 0.00 January 2, 2020 2,352,795.06 July 2, 2020 0.00 January 2, 2021 2,516,349.63 July 2, 2021 0.00 January 2, 2022 1,920,617.86 July 2, 2022 0.00 January 2, 2023 0.00 N373DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 510,931.21 July 2, 2004 0.00 January 2, 2005 655,785.00 July 2, 2005 0.00 January 2, 2006 655,785.00 July 2, 2006 0.00 January 2, 2007 655,785.00 July 2, 2007 0.00 January 2, 2008 655,785.00 July 2, 2008 0.00 January 2, 2009 655,785.00 July 2, 2009 0.00 January 2, 2010 655,785.00 July 2, 2010 0.00 January 2, 2011 655,785.00 July 2, 2011 0.00 January 2, 2012 655,785.00 July 2, 2012 0.00 January 2, 2013 609,765.00 July 2, 2013 0.00 January 2, 2014 609,765.00 July 2, 2014 245,440.00 January 2, 2015 598,260.00 July 2, 2015 0.00 January 2, 2016 598,260.00 July 2, 2016 0.00 January 2, 2017 598,260.00 July 2, 2017 0.00 January 2, 2018 598,260.00 July 2, 2018 0.00 January 2, 2019 3,580,077.45 July 2, 2019 0.00 January 2, 2020 2,352,795.06 July 2, 2020 0.00 January 2, 2021 2,516,349.63 July 2, 2021 0.00 January 2, 2022 1,920,617.86 July 2, 2022 0.00 January 2, 2023 0.00 N374DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 478,907.13 July 2, 2004 0.00 January 2, 2005 656,640.00 July 2, 2005 0.00 January 2, 2006 656,640.00 July 2, 2006 0.00 January 2, 2007 656,640.00 July 2, 2007 0.00 January 2, 2008 656,640.00 July 2, 2008 0.00 January 2, 2009 656,640.00 July 2, 2009 0.00 January 2, 2010 656,640.00 July 2, 2010 0.00 January 2, 2011 656,640.00 July 2, 2011 0.00 January 2, 2012 656,640.00 July 2, 2012 0.00 January 2, 2013 610,560.00 July 2, 2013 0.00 January 2, 2014 610,560.00 July 2, 2014 245,760.00 January 2, 2015 599,040.00 July 2, 2015 0.00 January 2, 2016 599,040.00 July 2, 2016 0.00 January 2, 2017 599,040.00 July 2, 2017 0.00 January 2, 2018 599,040.00 July 2, 2018 0.00 January 2, 2019 3,708,680.84 July 2, 2019 0.00 January 2, 2020 2,360,699.02 July 2, 2020 0.00 January 2, 2021 2,524,803.04 July 2, 2021 0.00 January 2, 2022 1,789,177.10 July 2, 2022 0.00 January 2, 2023 0.00 N375DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 478,907.13 July 2, 2004 0.00 January 2, 2005 656,640.00 July 2, 2005 0.00 January 2, 2006 656,640.00 July 2, 2006 0.00 January 2, 2007 656,640.00 July 2, 2007 0.00 January 2, 2008 656,640.00 July 2, 2008 0.00 January 2, 2009 656,640.00 July 2, 2009 0.00 January 2, 2010 656,640.00 July 2, 2010 0.00 January 2, 2011 656,640.00 July 2, 2011 0.00 January 2, 2012 656,640.00 July 2, 2012 0.00 January 2, 2013 610,560.00 July 2, 2013 0.00 January 2, 2014 610,560.00 July 2, 2014 245,760.00 January 2, 2015 599,040.00 July 2, 2015 0.00 January 2, 2016 599,040.00 July 2, 2016 0.00 January 2, 2017 599,040.00 July 2, 2017 0.00 January 2, 2018 599,040.00 July 2, 2018 0.00 January 2, 2019 3,708,680.84 July 2, 2019 0.00 January 2, 2020 2,360,699.02 July 2, 2020 0.00 January 2, 2021 2,524,803.04 July 2, 2021 0.00 January 2, 2022 1,789,177.10 July 2, 2022 0.00 January 2, 2023 0.00 N396DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $687,420.00 July 2, 2003 0.00 January 2, 2004 687,420.00 July 2, 2004 0.00 January 2, 2005 687,420.00 July 2, 2005 0.00 January 2, 2006 687,420.00 July 2, 2006 0.00 January 2, 2007 687,420.00 July 2, 2007 0.00 January 2, 2008 687,420.00 July 2, 2008 0.00 January 2, 2009 687,420.00 July 2, 2009 0.00 January 2, 2010 687,420.00 July 2, 2010 0.00 January 2, 2011 687,420.00 July 2, 2011 0.00 January 2, 2012 687,420.00 July 2, 2012 0.00 January 2, 2013 639,180.00 July 2, 2013 0.00 January 2, 2014 639,180.00 July 2, 2014 257,280.00 January 2, 2015 627,120.00 July 2, 2015 0.00 January 2, 2016 627,120.00 July 2, 2016 0.00 January 2, 2017 627,120.00 July 2, 2017 0.00 January 2, 2018 627,120.00 July 2, 2018 0.00 January 2, 2019 627,120.00 July 2, 2019 0.00 January 2, 2020 627,120.00 July 2, 2020 0.00 January 2, 2021 4,522,995.56 July 2, 2021 2,034,923.03 January 2, 2022 2,596,511.01 July 2, 2022 0.00 January 2, 2023 461,410.40 N397DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $687,420.00 July 2, 2003 0.00 January 2, 2004 687,420.00 July 2, 2004 0.00 January 2, 2005 687,420.00 July 2, 2005 0.00 January 2, 2006 687,420.00 July 2, 2006 0.00 January 2, 2007 687,420.00 July 2, 2007 0.00 January 2, 2008 687,420.00 July 2, 2008 0.00 January 2, 2009 687,420.00 July 2, 2009 0.00 January 2, 2010 687,420.00 July 2, 2010 0.00 January 2, 2011 687,420.00 July 2, 2011 0.00 January 2, 2012 687,420.00 July 2, 2012 0.00 January 2, 2013 639,180.00 July 2, 2013 0.00 January 2, 2014 639,180.00 July 2, 2014 257,280.00 January 2, 2015 627,120.00 July 2, 2015 0.00 January 2, 2016 627,120.00 July 2, 2016 0.00 January 2, 2017 627,120.00 July 2, 2017 0.00 January 2, 2018 627,120.00 July 2, 2018 0.00 January 2, 2019 627,120.00 July 2, 2019 0.00 January 2, 2020 627,120.00 July 2, 2020 0.00 January 2, 2021 4,522,995.56 July 2, 2021 2,034,923.03 January 2, 2022 2,596,511.01 July 2, 2022 0.00 January 2, 2023 461,410.40 N398DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $687,420.00 July 2, 2003 0.00 January 2, 2004 687,420.00 July 2, 2004 0.00 January 2, 2005 687,420.00 July 2, 2005 0.00 January 2, 2006 687,420.00 July 2, 2006 0.00 January 2, 2007 687,420.00 July 2, 2007 0.00 January 2, 2008 687,420.00 July 2, 2008 0.00 January 2, 2009 687,420.00 July 2, 2009 0.00 January 2, 2010 687,420.00 July 2, 2010 0.00 January 2, 2011 687,420.00 July 2, 2011 0.00 January 2, 2012 687,420.00 July 2, 2012 0.00 January 2, 2013 639,180.00 July 2, 2013 0.00 January 2, 2014 639,180.00 July 2, 2014 257,280.00 January 2, 2015 627,120.00 July 2, 2015 0.00 January 2, 2016 627,120.00 July 2, 2016 0.00 January 2, 2017 627,120.00 July 2, 2017 0.00 January 2, 2018 627,120.00 July 2, 2018 0.00 January 2, 2019 627,120.00 July 2, 2019 0.00 January 2, 2020 627,120.00 July 2, 2020 0.00 January 2, 2021 4,522,995.56 July 2, 2021 2,034,923.03 January 2, 2022 2,596,511.01 July 2, 2022 0.00 January 2, 2023 461,410.40 N399DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $689,130.00 July 2, 2003 0.00 January 2, 2004 689,130.00 July 2, 2004 0.00 January 2, 2005 689,130.00 July 2, 2005 0.00 January 2, 2006 689,130.00 July 2, 2006 0.00 January 2, 2007 689,130.00 July 2, 2007 0.00 January 2, 2008 689,130.00 July 2, 2008 0.00 January 2, 2009 689,130.00 July 2, 2009 0.00 January 2, 2010 689,130.00 July 2, 2010 0.00 January 2, 2011 689,130.00 July 2, 2011 0.00 January 2, 2012 689,130.00 July 2, 2012 0.00 January 2, 2013 640,770.00 July 2, 2013 0.00 January 2, 2014 640,770.00 July 2, 2014 257,920.00 January 2, 2015 628,680.00 July 2, 2015 0.00 January 2, 2016 628,680.00 July 2, 2016 0.00 January 2, 2017 628,680.00 July 2, 2017 0.00 January 2, 2018 628,680.00 July 2, 2018 0.00 January 2, 2019 628,680.00 July 2, 2019 0.00 January 2, 2020 628,680.00 July 2, 2020 0.00 January 2, 2021 4,529,889.33 July 2, 2021 2,048,265.01 January 2, 2022 2,599,264.94 July 2, 2022 0.00 January 2, 2023 462,340.72 N3730B --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $689,130.00 July 2, 2003 0.00 January 2, 2004 689,130.00 July 2, 2004 0.00 January 2, 2005 689,130.00 July 2, 2005 0.00 January 2, 2006 689,130.00 July 2, 2006 0.00 January 2, 2007 689,130.00 July 2, 2007 0.00 January 2, 2008 689,130.00 July 2, 2008 0.00 January 2, 2009 689,130.00 July 2, 2009 0.00 January 2, 2010 689,130.00 July 2, 2010 0.00 January 2, 2011 689,130.00 July 2, 2011 0.00 January 2, 2012 689,130.00 July 2, 2012 0.00 January 2, 2013 640,770.00 July 2, 2013 0.00 January 2, 2014 640,770.00 July 2, 2014 257,920.00 January 2, 2015 628,680.00 July 2, 2015 0.00 January 2, 2016 628,680.00 July 2, 2016 0.00 January 2, 2017 628,680.00 July 2, 2017 0.00 January 2, 2018 628,680.00 July 2, 2018 0.00 January 2, 2019 628,680.00 July 2, 2019 0.00 January 2, 2020 628,680.00 July 2, 2020 0.00 January 2, 2021 4,529,889.33 July 2, 2021 2,048,265.01 January 2, 2022 2,599,264.94 July 2, 2022 0.00 January 2, 2023 462,340.72 N3764D --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,670,814.70 July 2, 2021 2,044,894.96 January 2, 2022 2,688,013.72 July 2, 2022 0.00 January 2, 2023 475,236.62 N3765 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,670,814.70 July 2, 2021 2,044,894.96 January 2, 2022 2,688,013.72 July 2, 2022 0.00 January 2, 2023 475,236.62 N3766 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,670,814.70 July 2, 2021 2,044,894.96 January 2, 2022 2,688,013.72 July 2, 2022 0.00 January 2, 2023 475,236.62 N3767 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,670,814.70 July 2, 2021 2,044,894.96 January 2, 2022 2,688,013.72 July 2, 2022 0.00 January 2, 2023 475,236.62 N3768 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,742,802.36 July 2, 2021 1,908,105.12 January 2, 2022 2,749,223.16 July 2, 2022 0.00 January 2, 2023 478,829.36 N3769L --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,230.00 July 2, 2003 0.00 January 2, 2004 706,230.00 July 2, 2004 0.00 January 2, 2005 706,230.00 July 2, 2005 0.00 January 2, 2006 706,230.00 July 2, 2006 0.00 January 2, 2007 706,230.00 July 2, 2007 0.00 January 2, 2008 706,230.00 July 2, 2008 0.00 January 2, 2009 706,230.00 July 2, 2009 0.00 January 2, 2010 706,230.00 July 2, 2010 0.00 January 2, 2011 706,230.00 July 2, 2011 0.00 January 2, 2012 706,230.00 July 2, 2012 0.00 January 2, 2013 656,670.00 July 2, 2013 0.00 January 2, 2014 656,670.00 July 2, 2014 264,320.00 January 2, 2015 644,280.00 July 2, 2015 0.00 January 2, 2016 644,280.00 July 2, 2016 0.00 January 2, 2017 644,280.00 July 2, 2017 0.00 January 2, 2018 644,280.00 July 2, 2018 0.00 January 2, 2019 644,280.00 July 2, 2019 0.00 January 2, 2020 644,280.00 July 2, 2020 0.00 January 2, 2021 4,742,802.36 July 2, 2021 1,908,105.12 January 2, 2022 2,749,223.16 July 2, 2022 0.00 January 2, 2023 478,829.36 N37700 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $707,940.00 July 2, 2003 0.00 January 2, 2004 707,940.00 July 2, 2004 0.00 January 2, 2005 707,940.00 July 2, 2005 0.00 January 2, 2006 707,940.00 July 2, 2006 0.00 January 2, 2007 707,940.00 July 2, 2007 0.00 January 2, 2008 707,940.00 July 2, 2008 0.00 January 2, 2009 707,940.00 July 2, 2009 0.00 January 2, 2010 707,940.00 July 2, 2010 0.00 January 2, 2011 707,940.00 July 2, 2011 0.00 January 2, 2012 707,940.00 July 2, 2012 0.00 January 2, 2013 658,260.00 July 2, 2013 0.00 January 2, 2014 658,260.00 July 2, 2014 264,960.00 January 2, 2015 645,840.00 July 2, 2015 0.00 January 2, 2016 645,840.00 July 2, 2016 0.00 January 2, 2017 645,840.00 July 2, 2017 0.00 January 2, 2018 645,840.00 July 2, 2018 0.00 January 2, 2019 645,840.00 July 2, 2019 0.00 January 2, 2020 645,840.00 July 2, 2020 0.00 January 2, 2021 4,749,696.13 July 2, 2021 1,921,447.10 January 2, 2022 2,751,977.09 July 2, 2022 0.00 January 2, 2023 479,759.68 N3771K --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $707,940.00 July 2, 2003 0.00 January 2, 2004 707,940.00 July 2, 2004 0.00 January 2, 2005 707,940.00 July 2, 2005 0.00 January 2, 2006 707,940.00 July 2, 2006 0.00 January 2, 2007 707,940.00 July 2, 2007 0.00 January 2, 2008 707,940.00 July 2, 2008 0.00 January 2, 2009 707,940.00 July 2, 2009 0.00 January 2, 2010 707,940.00 July 2, 2010 0.00 January 2, 2011 707,940.00 July 2, 2011 0.00 January 2, 2012 707,940.00 July 2, 2012 0.00 January 2, 2013 658,260.00 July 2, 2013 0.00 January 2, 2014 658,260.00 July 2, 2014 264,960.00 January 2, 2015 645,840.00 July 2, 2015 0.00 January 2, 2016 645,840.00 July 2, 2016 0.00 January 2, 2017 645,840.00 July 2, 2017 0.00 January 2, 2018 645,840.00 July 2, 2018 0.00 January 2, 2019 645,840.00 July 2, 2019 0.00 January 2, 2020 645,840.00 July 2, 2020 0.00 January 2, 2021 4,749,696.13 July 2, 2021 1,921,447.10 January 2, 2022 2,751,977.09 July 2, 2022 0.00 January 2, 2023 479,759.68 N67171 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,256,607.40 July 2, 2003 0.00 January 2, 2004 1,126,320.00 July 2, 2004 0.00 January 2, 2005 1,126,320.00 July 2, 2005 0.00 January 2, 2006 1,126,320.00 July 2, 2006 0.00 January 2, 2007 1,126,320.00 July 2, 2007 0.00 January 2, 2008 1,126,320.00 July 2, 2008 0.00 January 2, 2009 1,126,320.00 July 2, 2009 0.00 January 2, 2010 1,126,320.00 July 2, 2010 0.00 January 2, 2011 1,126,320.00 July 2, 2011 0.00 January 2, 2012 1,128,675.41 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N185DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,420,172.47 July 2, 2003 0.00 January 2, 2004 1,272,924.00 July 2, 2004 0.00 January 2, 2005 1,272,924.00 July 2, 2005 0.00 January 2, 2006 1,272,924.00 July 2, 2006 0.00 January 2, 2007 1,272,924.00 July 2, 2007 0.00 January 2, 2008 1,272,924.00 July 2, 2008 0.00 January 2, 2009 1,272,924.00 July 2, 2009 0.00 January 2, 2010 1,272,924.00 July 2, 2010 0.00 January 2, 2011 1,272,924.00 July 2, 2011 0.00 January 2, 2012 1,275,590.70 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N186DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,420,172.47 July 2, 2003 0.00 January 2, 2004 1,272,924.00 July 2, 2004 0.00 January 2, 2005 1,272,924.00 July 2, 2005 0.00 January 2, 2006 1,272,924.00 July 2, 2006 0.00 January 2, 2007 1,272,924.00 July 2, 2007 0.00 January 2, 2008 1,272,924.00 July 2, 2008 0.00 January 2, 2009 1,272,924.00 July 2, 2009 0.00 January 2, 2010 1,272,924.00 July 2, 2010 0.00 January 2, 2011 1,272,924.00 July 2, 2011 0.00 January 2, 2012 1,275,590.74 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N187DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,481,477.57 July 2, 2003 0.00 January 2, 2004 1,327,872.00 July 2, 2004 0.00 January 2, 2005 1,327,872.00 July 2, 2005 0.00 January 2, 2006 1,327,872.00 July 2, 2006 0.00 January 2, 2007 1,327,872.00 July 2, 2007 0.00 January 2, 2008 1,327,872.00 July 2, 2008 0.00 January 2, 2009 1,327,872.00 July 2, 2009 0.00 January 2, 2010 1,327,872.00 July 2, 2010 0.00 January 2, 2011 1,327,872.00 July 2, 2011 0.00 January 2, 2012 1,330,654.05 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N188DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,481,477.57 July 2, 2003 0.00 January 2, 2004 1,327,872.00 July 2, 2004 0.00 January 2, 2005 1,327,872.00 July 2, 2005 0.00 January 2, 2006 1,327,872.00 July 2, 2006 0.00 January 2, 2007 1,327,872.00 July 2, 2007 0.00 January 2, 2008 1,327,872.00 July 2, 2008 0.00 January 2, 2009 1,327,872.00 July 2, 2009 0.00 January 2, 2010 1,327,872.00 July 2, 2010 0.00 January 2, 2011 1,327,872.00 July 2, 2011 0.00 January 2, 2012 1,330,654.05 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N189DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,542,782.67 July 2, 2003 0.00 January 2, 2004 1,382,820.00 July 2, 2004 0.00 January 2, 2005 1,382,820.00 July 2, 2005 0.00 January 2, 2006 1,382,820.00 July 2, 2006 0.00 January 2, 2007 1,382,820.00 July 2, 2007 0.00 January 2, 2008 1,382,820.00 July 2, 2008 0.00 January 2, 2009 1,382,820.00 July 2, 2009 0.00 January 2, 2010 1,382,820.00 July 2, 2010 0.00 January 2, 2011 1,382,820.00 July 2, 2011 0.00 January 2, 2012 1,385,717.35 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N190DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,542,782.67 July 2, 2003 0.00 January 2, 2004 1,382,820.00 July 2, 2004 0.00 January 2, 2005 1,382,820.00 July 2, 2005 0.00 January 2, 2006 1,382,820.00 July 2, 2006 0.00 January 2, 2007 1,382,820.00 July 2, 2007 0.00 January 2, 2008 1,382,820.00 July 2, 2008 0.00 January 2, 2009 1,382,820.00 July 2, 2009 0.00 January 2, 2010 1,382,820.00 July 2, 2010 0.00 January 2, 2011 1,382,820.00 July 2, 2011 0.00 January 2, 2012 1,385,717.35 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N191DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,542,782.67 July 2, 2003 0.00 January 2, 2004 1,382,820.00 July 2, 2004 0.00 January 2, 2005 1,382,820.00 July 2, 2005 0.00 January 2, 2006 1,382,820.00 July 2, 2006 0.00 January 2, 2007 1,382,820.00 July 2, 2007 0.00 January 2, 2008 1,382,820.00 July 2, 2008 0.00 January 2, 2009 1,382,820.00 July 2, 2009 0.00 January 2, 2010 1,382,820.00 July 2, 2010 0.00 January 2, 2011 1,382,820.00 July 2, 2011 0.00 January 2, 2012 1,385,717.35 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N192DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,542,782.67 July 2, 2003 0.00 January 2, 2004 1,382,820.00 July 2, 2004 0.00 January 2, 2005 1,382,820.00 July 2, 2005 0.00 January 2, 2006 1,382,820.00 July 2, 2006 0.00 January 2, 2007 1,382,820.00 July 2, 2007 0.00 January 2, 2008 1,382,820.00 July 2, 2008 0.00 January 2, 2009 1,382,820.00 July 2, 2009 0.00 January 2, 2010 1,382,820.00 July 2, 2010 0.00 January 2, 2011 1,382,820.00 July 2, 2011 0.00 January 2, 2012 1,385,717.35 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N828MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,826,898.97 July 2, 2003 0.00 January 2, 2004 1,618,822.80 July 2, 2004 0.00 January 2, 2005 1,618,822.80 July 2, 2005 0.00 January 2, 2006 1,618,822.80 July 2, 2006 0.00 January 2, 2007 1,618,822.80 July 2, 2007 0.00 January 2, 2008 1,618,822.80 July 2, 2008 0.00 January 2, 2009 1,618,822.80 July 2, 2009 0.00 January 2, 2010 1,618,822.80 July 2, 2010 0.00 January 2, 2011 1,618,822.80 July 2, 2011 0.00 January 2, 2012 1,622,343.40 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N829MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,826,898.97 July 2, 2003 0.00 January 2, 2004 1,618,822.80 July 2, 2004 0.00 January 2, 2005 1,618,822.80 July 2, 2005 0.00 January 2, 2006 1,618,822.80 July 2, 2006 0.00 January 2, 2007 1,618,822.80 July 2, 2007 0.00 January 2, 2008 1,618,822.80 July 2, 2008 0.00 January 2, 2009 1,618,822.80 July 2, 2009 0.00 January 2, 2010 1,618,822.80 July 2, 2010 0.00 January 2, 2011 1,618,822.80 July 2, 2011 0.00 January 2, 2012 1,623,581.01 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N830MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,834,309.47 July 2, 2003 0.00 January 2, 2004 1,625,389.20 July 2, 2004 0.00 January 2, 2005 1,625,389.20 July 2, 2005 0.00 January 2, 2006 1,625,389.20 July 2, 2006 0.00 January 2, 2007 1,625,389.20 July 2, 2007 0.00 January 2, 2008 1,625,389.20 July 2, 2008 0.00 January 2, 2009 1,625,389.20 July 2, 2009 0.00 January 2, 2010 1,625,389.20 July 2, 2010 0.00 January 2, 2011 1,625,389.20 July 2, 2011 0.00 January 2, 2012 1,630,166.72 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N831MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,834,309.47 July 2, 2003 0.00 January 2, 2004 1,625,389.20 July 2, 2004 0.00 January 2, 2005 1,625,389.20 July 2, 2005 0.00 January 2, 2006 1,625,389.20 July 2, 2006 0.00 January 2, 2007 1,625,389.20 July 2, 2007 0.00 January 2, 2008 1,625,389.20 July 2, 2008 0.00 January 2, 2009 1,625,389.20 July 2, 2009 0.00 January 2, 2010 1,625,389.20 July 2, 2010 0.00 January 2, 2011 1,625,389.20 July 2, 2011 0.00 January 2, 2012 1,630,166.72 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N832MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,834,309.47 July 2, 2003 0.00 January 2, 2004 1,625,389.20 July 2, 2004 0.00 January 2, 2005 1,625,389.20 July 2, 2005 0.00 January 2, 2006 1,625,389.20 July 2, 2006 0.00 January 2, 2007 1,625,389.20 July 2, 2007 0.00 January 2, 2008 1,625,389.20 July 2, 2008 0.00 January 2, 2009 1,625,389.20 July 2, 2009 0.00 January 2, 2010 1,625,389.20 July 2, 2010 0.00 January 2, 2011 1,625,389.20 July 2, 2011 0.00 January 2, 2012 1,630,166.72 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 N833MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $1,842,124.83 July 2, 2003 0.00 January 2, 2004 1,632,160.80 July 2, 2004 0.00 January 2, 2005 1,632,160.80 July 2, 2005 0.00 January 2, 2006 1,632,160.80 July 2, 2006 0.00 January 2, 2007 1,632,160.80 July 2, 2007 0.00 January 2, 2008 1,632,160.80 July 2, 2008 0.00 January 2, 2009 1,632,160.80 July 2, 2009 0.00 January 2, 2010 1,632,160.80 July 2, 2010 0.00 January 2, 2011 1,632,160.80 July 2, 2011 0.00 January 2, 2012 1,636,747.04 July 2, 2012 0.00 January 2, 2013 0.00 July 2, 2013 0.00 January 2, 2014 0.00 July 2, 2014 0.00 January 2, 2015 0.00 July 2, 2015 0.00 January 2, 2016 0.00 July 2, 2016 0.00 January 2, 2017 0.00 July 2, 2017 0.00 January 2, 2018 0.00 July 2, 2018 0.00 January 2, 2019 0.00 July 2, 2019 0.00 January 2, 2020 0.00 July 2, 2020 0.00 January 2, 2021 0.00 July 2, 2021 0.00 January 2, 2022 0.00 July 2, 2022 0.00 January 2, 2023 0.00 SCHEDULE I-B to TRUST SUPPLEMENT NO. 2002-1G-1 AGGREGATE EQUIPMENT NOTE PRINCIPAL PAYMENTS Payment Date Scheduled Principal Payments --------------- ---------------------------- April 30, 2002 January 2, 2003 $33,323,669.32 July 2, 2003 0.00 January 2, 2004 32,678,622.68 July 2, 2004 0.00 January 2, 2005 33,323,796.00 July 2, 2005 0.00 January 2, 2006 33,323,796.00 July 2, 2006 0.00 January 2, 2007 33,323,796.00 July 2, 2007 0.00 January 2, 2008 33,323,796.00 July 2, 2008 0.00 January 2, 2009 33,323,796.00 July 2, 2009 0.00 January 2, 2010 33,323,796.00 July 2, 2010 0.00 January 2, 2011 33,323,796.00 July 2, 2011 0.00 January 2, 2012 33,375,836.00 July 2, 2012 0.00 January 2, 2013 10,896,270.00 July 2, 2013 0.00 January 2, 2014 10,896,270.00 July 2, 2014 4,385,920.00 January 2, 2015 10,690,680.00 July 2, 2015 0.00 January 2, 2016 10,690,680.00 July 2, 2016 0.00 January 2, 2017 10,690,680.00 July 2, 2017 0.00 January 2, 2018 10,690,680.00 July 2, 2018 0.00 January 2, 2019 22,873,596.58 July 2, 2019 0.00 January 2, 2020 17,723,068.16 July 2, 2020 0.00 January 2, 2021 70,379,326.46 July 2, 2021 26,039,983.39 January 2, 2022 42,162,108.21 July 2, 2022 0.00 January 2, 2023 6,127,037.20 SCHEDULE II to TRUST SUPPLEMENT NO. 2002-1G-1 EQUIPMENT NOTES, PRINCIPAL AMOUNTS AND MATURITIES Equipment Notes Principal Amount Maturity --------------- ---------------- --------------- N372DA $19,985,061.21 January 2, 2023 N373DA $19,985,061.21 January 2, 2023 N374DA $19,978,427.13 January 2, 2023 N375DA $19,978,427.13 January 2, 2023 N396DA $21,788,400.00 January 2, 2023 N397DA $21,788,400.00 January 2, 2023 N398DA $21,788,400.00 January 2, 2023 N399DA $21,842,600.00 January 2, 2023 N3730B $21,842,600.00 January 2, 2023 N3764D $22,384,600.00 January 2, 2023 N3765 $22,384,600.00 January 2, 2023 N3766 $22,384,600.00 January 2, 2023 N3767 $22,384,600.00 January 2, 2023 N3768 $22,384,600.00 January 2, 2023 N3769L $22,384,600.00 January 2, 2023 N37700 $22,438,800.00 January 2, 2023 N3771K $22,438,800.00 January 2, 2023 N67171 $11,395,842.81 January 2, 2023 N185DN $12,879,155.17 January 2, 2023 N186DN $12,879,155.21 January 2, 2023 N187DN $13,435,107.62 January 2, 2023 N188DN $13,435,107.62 January 2, 2023 N189DN $13,991,060.02 January 2, 2023 N190DN $13,991,060.02 January 2, 2023 N191DN $13,991,060.02 January 2, 2023 N192DN $13,991,060.02 January 2, 2023 N828MH $16,399,824.77 January 2, 2023 N829MH $16,401,062.38 January 2, 2023 N830MH $16,467,589.79 January 2, 2023 N831MH $16,467,589.79 January 2, 2023 N832MH $16,467,589.79 January 2, 2023 N833MH $16,536,158.27 January 2, 2023 SCHEDULE III to TRUST SUPPLEMENT NO. 2002-1G-1 AIRCRAFT Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH SCHEDULE IV to TRUST SUPPLEMENT NO. 2002-1G-1 NOTE DOCUMENTS Participation Agreement Indenture and Security Agreement Series 2002-1G-1 Equipment Note Series 2002-1G-2 Equipment Note Series 2002-1C Equipment Note Series 2002-1D Equipment Note For each of the following aircraft: (except for the B737-832 aircraft, for which there is no Series 2002-1D Equipment Note): Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH EX-4.(A)(3) 4 de763576-ex4a3.txt TRUST SUP. NO. 2002-1G2 Exhibit 4(a)(3) TRUST SUPPLEMENT NO. 2002-1G-2 Dated as of April 30, 2002 between DELTA AIR LINES, INC. and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee, To PASS THROUGH TRUST AGREEMENT Dated as of November 16, 2000 Delta Air Lines, Inc. Pass Through Trust 2002-1G-2 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2 TRUST SUPPLEMENT NO. 2002-1G-2 This TRUST SUPPLEMENT NO. 2002-1G-2, dated as of April 30, 2002 (the "Trust Supplement"), between DELTA AIR LINES, INC., a Delaware corporation, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as Trustee, to the Pass Through Trust Agreement, dated as of November 16, 2000, between the Company (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01) and the Trustee (the "Basic Agreement"). W I T N E S S E T H: WHEREAS, the Basic Agreement, which is unlimited as to the aggregate face amount of Certificates that may be issued and authenticated thereunder, has heretofore or concurrently herewith been executed and delivered; WHEREAS, subject to clause (ii) of this recital, (i) pursuant to each Indenture with respect to an Aircraft owned by Delta at the time such Indenture is entered into (an "Owned Aircraft"), Delta will issue on a recourse basis four (or, in the case of a Boeing 737-832 Aircraft, three) series of Equipment Notes secured by such Aircraft and (ii) if an Aircraft becomes subject to a sale/leaseback transaction at any time after the date hereof (a "Leased Aircraft"), pursuant to an Indenture with respect to such Aircraft, as amended and restated in connection with such sale/leaseback transaction, the Owner Trustee will assume on a non-recourse basis Delta's obligations in respect of the Equipment Notes secured by such Aircraft, subject to re-optimization of such Equipment Notes (if such sale/leaseback transaction occurs prior to May 1, 2003); WHEREAS, the Trustee shall hereby declare the creation of the Class G-2 Trust (as defined below) for the benefit of Holders of the Class G-2 Certificates (as defined below) to be issued in respect of such Class G-2 Trust, and the initial Holders of the Class G-2 Certificates, as grantors of such Class G-2 Trust, by their respective acceptances of the Class G-2 Certificates, shall join in the creation of the Class G-2 Trust with the Trustee; WHEREAS, all Certificates to be issued by the Class G-2 Trust will evidence Fractional Undivided Interests in the Class G-2 Trust and will have no rights, benefits or interests in respect of any other separate Trust or the property held therein; WHEREAS, pursuant to the terms and conditions of the Basic Agreement, as supplemented by this Trust Supplement and the Participation Agreements, the Trustee on behalf of the Class G-2 Trust shall purchase the Equipment Notes issued by the Company pursuant to the Indentures relating to the Aircraft having the identical interest rate as, and final maturity dates not later than the final Regular Distribution Date of, the Class G-2 Certificates issued hereunder and shall hold such Equipment Notes in trust for the benefit of the Class G-2 Certificateholders; WHEREAS, pursuant to the terms and conditions of the Intercreditor Agreement referred to in Section 3.01(h) hereof (the "Intercreditor Agreement"), the Trustee and the other parties thereto will agree to the terms of subordination set forth therein; WHEREAS, all of the conditions and requirements necessary to make this Trust Supplement, when duly executed and delivered, a valid, binding and legal instrument in accordance with its terms and for the purposes herein expressed, have been done, performed and fulfilled, and the execution and delivery of this Trust Supplement in the form and with the terms hereof have been in all respects duly authorized; WHEREAS, this Trust Supplement is subject to the provisions of the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions; NOW THEREFORE, in consideration of the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. Unless otherwise specified herein or the context otherwise requires, capitalized terms used but not defined herein shall have the respective meanings set forth, and shall be construed and interpreted in the manner described, in the Basic Agreement or, to the extent not defined therein, in the Intercreditor Agreement. Section 1.02 Amended Definitions. For purposes of the Class G-2 Trust, the definitions of the following capitalized terms as specified heretofore in Section 1.01 of the Basic Agreement shall be amended to read as follows: "Pool Balance: means, with respect to the Class G-2 Certificates as of any date, (i) the original aggregate face amount of the Class G-2 Certificates less (ii) the aggregate amount of all distributions made in respect of the Class G-2 Certificates other than distributions made in respect of interest or premium or reimbursement of any costs or expenses incurred in connection therewith. The Pool Balance as of any Regular Distribution Date or Special Distribution Date shall be computed after giving effect to the payment of principal, if any, on the Series G-2 Equipment Notes or other Trust Property held in the Class G-2 Trust and the distribution thereof to be made on such date and payments under the Policy made for the benefit of the Class G-2 Certificateholders (other than in respect of the Liquidity Facilities and interest on the Class G-2 Certificates)." "Trust Property: means, with respect to the Class G-2 Trust, (i) subject to the Intercreditor Agreement, the Series G-2 Equipment Notes held as the property of the Class G-2 Trust, all monies at any time paid thereon and all monies due and to become due thereunder, (ii) funds from time to time deposited in the Certificate Account and the Special Payments Account, each for the Class G-2 Trust, and, subject to the Intercreditor Agreement, any proceeds from the sale by the Trustee pursuant to Article VI of the Basic Agreement of any Series G-2 Equipment Note referred to in (i) above, (iii) all rights of the Class G-2 Trust and the Trustee, on behalf of the Class G-2 Trust, under the Intercreditor Agreement or Class G-2 Liquidity Facility, including, without limitation, all rights to receive all monies and other property payable thereunder, (iv) all monies or other property receivable under the Intercreditor Agreement or the Class G-2 Liquidity Facility and (v) all monies or other property payable to the Trustee on behalf of the Class G-2 Trust pursuant to the Policy." ARTICLE II DECLARATION OF TRUST Section 2.01 Declaration of Trust. The Trustee hereby declares the creation of a Trust, designated the "Delta Air Lines Pass Through Trust 2002-1G-2" (the "Class G-2 Trust"), for the benefit of the Holders of the Class G-2 Certificates to be issued in respect of such Class G-2 Trust, and the initial Holders of the Class G-2 Certificates, as grantors of such Class G-2 Trust, by their respective acceptances of the Class G-2 Certificates, join in the creation of such Class G-2 Trust with the Trustee. The Trustee, by the execution and delivery of this Trust Supplement, acknowledges its acceptance of all right, title and interest in and to the Trust Property to be acquired pursuant to Section 2.02 of the Basic Agreement and the Participation Agreements and the Trustee will hold such right, title and interest for the benefit of all present and future Holders of the Class G-2 Certificates, upon the trusts set forth in the Basic Agreement and this Trust Supplement. ARTICLE III THE CERTIFICATES Section 3.01 The Certificates. There is hereby created a series of Certificates to be issued under this Agreement designated as "6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2" (the "Class G-2 Certificates"). Each Class G-2 Certificate represents a Fractional Undivided Interest in the Class G-2 Trust created hereby. The Class G-2 Certificates shall be the only instruments evidencing a Fractional Undivided Interest in the Class G-2 Trust. The terms and conditions applicable to the Class G-2 Certificates and the Class G-2 Trust are as follows: (a) The aggregate face amount of the Class G-2 Certificates that may be authenticated and delivered under this Agreement (except for Class G-2 Certificates authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Class G-2 Certificates pursuant to Sections 3.03, 3.04, 3.05 and 3.06 of the Basic Agreement) is $370,286,000. (b) The Cut-off Date is May 28, 2002. (c) The Regular Distribution Dates with respect to any payment of Scheduled Payments means January 2 and July 2 of each year, commencing on January 2, 2003, until payment of all of the Scheduled Payments to be made under the Equipment Notes has been made. The entire principal amount of the Equipment Notes to be held by the Class G-2 Trust is scheduled for payment on July 2, 2012. (d) The Special Distribution Dates with respect to the Class G-2 Certificates means any Business Day on which a Special Payment is to be distributed pursuant to this Agreement. (e) The Class G-2 Certificates shall be in the form attached hereto as Exhibit A, shall be Book-Entry Certificates and shall be subject to the conditions set forth in the Letter of Representations between the Company and The Depository Trust Company, as initial Clearing Agency, attached hereto as Exhibit B. (f) The proceeds of the Class G-2 Certificates issued by the Class G-2 Trust shall be used to acquire the Equipment Notes described in Schedule I, such Equipment Notes to relate to the Aircraft described in Schedule II and the Note Documents described in Schedule III. (g) Any Person acquiring or accepting a Class G-2 Certificate or an interest therein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase Class G-2 Certificates or an interest therein or (ii) the purchase and holding of Class G-2 Certificates or interests therein by such Person is exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. "Plan" means a retirement plan or other employee benefit plan or arrangement, including for this purpose an individual retirement account, annuity or Keogh plan, that is subject to Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal Revenue Code of 1986 (the "Code"), or such a plan or arrangement which is a foreign, church or governmental plan or arrangement exempt from Title I of ERISA and Section 4975 of the Code but subject to a foreign, federal, state, or local law which is substantially similar to the provisions of Title I of ERISA or Section 4975 of the Code (each, a "Similar Law"). (h) The Class G-2 Certificates will be subject to the following Intercreditor Agreement (and to the extent the terms thereof (including the definitions of defined terms) are inconsistent with the terms of this Agreement, such Intercreditor Agreement shall control): that certain Intercreditor Agreement, dated as of the date hereof, among State Street Bank and Trust Company of Connecticut, National Association, as Trustee under each Trust (as defined therein), MBIA Insurance Corporation, as the Policy Provider, Westdeutsche Landesbank Girozentrale, New York Branch, as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider and Class C Liquidity Provider, and State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent thereunder. Potential Purchasers shall have the rights upon the occurrence of a Triggering Event set forth in Article IV hereof. The Trustee and, by acceptance of any Class G-2 Certificate, each Certificateholder thereof, agrees to be bound by all of the provisions of the Intercreditor Agreement, including the subordination provisions of Section 9.09 thereof. (i) The Class G-2 Certificates will have the benefit of the following Liquidity Facility: that certain Revolving Credit Agreement, dated as of the date hereof, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent under the Intercreditor Agreement, as agent and trustee for the Class G-2 Trust, and Westdeutsche Landesbank Girozentrale, New York Branch. (j) Payments of interest on the Class G-2 Certificates when due and payment of the outstanding balance on the Class G-2 Certificates on the Final Legal Distribution Date for the Class G-2 Certificates and under certain other circumstances will be supported by a financial guaranty insurance policy to be issued by the Policy Provider under the Policy Provider Agreement, such policy, together with any policy issued in replacement thereof pursuant to the Intercreditor Agreement, in each case as amended, supplemented or otherwise modified from time to time in accordance with their respective terms, being the "Policy." (k) Subject to Section 2.02(b) of the Basic Agreement, there will not be any deposit agreement, escrow agreement or other similar arrangement prior to delivery of the Aircraft. (l) The Company may at any time purchase any of the Class G-2 Certificates at any price in the open market and may hold such Class G-2 Certificates to maturity. (m) The Responsible Party is the Company. Section 3.02 Delivery of Documents. The Trustee is hereby directed (i) to execute and deliver the Intercreditor Agreement referred to in Section 3.01(h) of this Trust Supplement and the Policy Provider Agreement, each in the form delivered to the Trustee by the Company and (ii) subject to the respective terms thereof, to perform its obligations thereunder. Section 3.03 Policy Provider Agreement. For purposes of this Trust Supplement, the representations and warranties of the Trustee set forth in Section 7.15(b), (c), (d) and (e) of the Basic Agreement shall be amended by adding the phrase "the Policy Provider Agreement" after each reference to "Intercreditor Agreement" therein. ARTICLE IV DEFAULT Section 4.01 Purchase Rights of Certificateholders. (a) By acceptance of its Class G-2 Certificate, each Class G-2 Certificateholder agrees that at any time after the occurrence and during the continuation of a Triggering Event, (i) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates pursuant to Section 4.01(a)(v) hereof, if the Class G-1 Trustee is then the Controlling Party, each Class G-2 Certificateholder shall have the right to purchase, for the purchase price set forth in the Class G-1 Trust Agreement, all, but not less than all, of the Class G-1 Certificates upon ten days' prior written notice to the Class G-1 Trustee and each other Class G-2 Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class G-2 Certificateholder notifies such purchasing Class G-2 Certificateholder that such other Class G-2 Certificateholder wants to participate in such purchase, then such other Class G-2 Certificateholder may join with the purchasing Class G-2 Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates pro rata based on the Fractional Undivided Interest in the Class G-2 Trust held by each such Class G-2 Certificateholder and (B) if prior to the end of such ten-day period any other Class G-2 Certificateholder fails to notify the purchasing Class G-2 Certificateholder of such other Class G-2 Certificateholder's desire to participate in such a purchase, then such other Class G-2 Certificateholder shall lose its right to purchase the Class G-1 Certificates pursuant to this Section 4.01(a)(i); and (ii) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-2 Certificates pursuant to Section 4.01(a)(v) hereof, if the Trustee is then the Controlling Party, each Class G-1 Certificateholder shall have the right to purchase all, but not less than all, of the Class G-2 Certificates upon ten days' prior written notice to the Trustee and each other Class G-1 Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class G-1 Certificateholder notifies such purchasing Class G-1 Certificateholder that such other Class G-1 Certificateholder wants to participate in such purchase, then such other Class G-1 Certificateholder may join with the purchasing Class G-1 Certificateholder to purchase all, but not less than all, of the Class G-2 Certificates pro rata based on the Fractional Undivided Interest in the Class G-1 Trust held by each such Class G-1 Certificateholder and (B) if prior to the end of such ten-day period any other Class G-1 Certificateholder fails to notify the purchasing Class G-1 Certificateholder of such other Class G-1 Certificateholder's desire to participate in such a purchase, then such other Class G-1 Certificateholder shall lose its right to purchase the Class G-2 Certificates pursuant to this Section 4.01(a)(ii); and (iii) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-1 Certificates pursuant to Section 4.01(a)(v) hereof, each Class C Certificateholder shall have the right (which shall not expire upon any purchase of the Class G-2 Certificates or the Class G-1 Certificates pursuant to clause (i) or (ii) above) to purchase all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates upon ten days' prior written notice to the Trustee, the Class G-1 Trustee and each other Class C Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class C Certificateholder notifies such purchasing Class C Certificateholder that such other Class C Certificateholder wants to participate in such purchase, then such other Class C Certificateholder may join with the purchasing Class C Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates pro rata based on the Fractional Undivided Interest in the Class C Trust held by each such Class C Certificateholder and (B) if prior to the end of such ten-day period any other Class C Certificateholder fails to notify the purchasing Class C Certificateholder of such other Class C Certificateholder's desire to participate in such a purchase, then such other Class C Certificateholder shall lose its right to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to this Section 4.01(a)(iii); and (iv) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-1 Certificates pursuant to Section 4.01(a)(v) hereof ( it being understood that such purchase or election to purchase shall not affect the rights of the Class D Certificateholders with respect to the purchase of the Class C Certificates), each Class D Certificateholder (other than the Company or any of its Affiliates) shall have the right (which shall not expire upon any purchase of the Class G-1 Certificates or the Class G-2 Certificates pursuant to clause (i), (ii) or (iii) above) to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates upon ten days' prior written notice to the Trustee, the Class G-1 Trustee, the Class C Trustee and each other Class D Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class D Certificateholder notifies such purchasing Class D Certificateholder that such other Class D Certificateholder wants to participate in such purchase, then such other Class D Certificateholder may join with the purchasing Class D Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pro rata based on the Fractional Undivided Interest in the Class D Trust held by each such Class D Certificateholder and (B) if prior to the end of such ten-day period any other Class D Certificateholder fails to notify the purchasing Class D Certificateholder of such other Class D Certificateholder's desire to participate in such a purchase, then such other Class D Certificateholder shall lose its right to purchase the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pursuant to this Section 4.01(a)(iv); and (v) whether or not any Class G-1, Class G-2, Class C or Class D Certificateholders have exercised their rights pursuant to paragraphs (i), (ii), (iii) or (iv) above, the Policy Provider (except in the event of a Policy Provider Default), if it is then the Controlling Party, shall have the right to purchase all, but not less than all, of the (x) Class G-2 Certificates upon ten days' written notice to the Trustee and the holders of the Class G-2 Certificates and (y) the Class G-1 Certificates upon ten days' written notice to the Class G-1 Trustee and the holders of the Class G-1 Certificates. The purchase price with respect to the Class G-2 Certificates shall be equal to the Pool Balance of the Class G-2 Certificates, together with accrued and unpaid interest in respect thereof to the date of such purchase, without premium, but including any other amounts then due and payable to the Class G-2 Certificateholders under this Agreement, the Intercreditor Agreement or any Note Document or on or in respect of the Class G-2 Certificates; provided, however, that if such purchase occurs after the Record Date relating to any Distribution Date, such purchase price shall be reduced by the amount to be distributed hereunder on such related Distribution Date (which deducted amounts shall remain distributable to, and may be retained by, the Class G-2 Certificateholders as of such Record Date); provided, further that no such purchase of Class G-2 Certificates pursuant to clause (iii) or (iv) above shall be effective unless the purchaser(s) shall certify to the Trustee that contemporaneously with such purchase, such purchaser(s) is purchasing, pursuant to the terms of this Agreement and the Intercreditor Agreement, all of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates that are senior to the securities held by such purchaser(s), subject to the purchase rights of the Policy Provider provided in Section 4.01(a)(v) hereof. Each payment of the purchase price of the Class G-2 Certificates referred to in the first sentence hereof shall be made to an account or accounts designated by the Trustee and each such purchase shall be subject to the terms of this Section 4.01(a). Each Class G-2 Certificateholder agrees by its acceptance of its Certificate that it will, upon payment from such Class G-1 Certificateholder(s), Class C Certificateholder(s), Class D Certificateholder(s) or the Policy Provider, as the case may be, of the purchase price set forth in the first sentence of this paragraph, forthwith sell, assign, transfer and convey to the purchaser(s) thereof (without recourse, representation or warranty of any kind except as to its own acts) all of the right, title, interest and obligation of such Class G-2 Certificateholder in this Agreement, the Intercreditor Agreement, the Policy, the Policy Provider Agreement, the Class G-2 Liquidity Facility, the Note Documents and all Class G-2 Certificates held by such Class G-2 Certificateholder (excluding all right, title and interest under any of the foregoing to the extent such right, title or interest is with respect to an obligation not then due and payable as respects any action or inaction or state of affairs occurring prior to such sale) and the purchaser(s) shall assume all of such Class G-2 Certificateholder's obligations under this Agreement, the Intercreditor Agreement, the Policy, the Policy Provider Agreement, the Class G-2 Liquidity Facility, the Note Documents and all such Class G-2 Certificates. The Class G-2 Certificates will be deemed to be purchased on the date payment of the purchase price is made notwithstanding the failure of any Class G-2 Certificateholder to deliver any Class G-2 Certificate and, upon such a purchase, (i) the only rights of the Class G-2 Certificateholders will be to deliver the Class G-2 Certificates and (ii) if the purchaser(s) shall so request, each such Class G-2 Certificateholder will comply with all the provisions of Section 3.04 of the Basic Agreement to enable new Class G-2 Certificates to be issued to the purchaser(s) in such denominations as it shall request. All charges and expenses in connection with the issuance of any such new Class G-2 Certificates shall be borne by the purchaser(s) thereof. (b) This Section 4.01 supplements and, to the extent inconsistent with any provision of Section 6.01(a) of the Basic Agreement, replaces the provisions of Section 6.01(a) of the Basic Agreement. Notwithstanding anything to the contrary set forth herein or in any Operative Agreement, the provisions of this Section 4.01 may not be amended in any manner without the consent of each Class G-1 Certificateholder, Class G-2 Certificateholder, Class C Certificateholder or Class D Certificateholder (other than the Company or any of its Affiliates) that would be adversely affected thereby, or the Policy Provider, if it would be adversely affected thereby. ARTICLE V SUPPLEMENTAL AGREEMENTS Section 5.01 Supplemental Agreements. (a) For purposes of the Class G-2 Trust only, the following provisions of the Basic Agreement shall be amended as provided below. (i) Section 7.09(b) of the Basic Agreement shall be amended by inserting the phrase "the Policy Provider," immediately after each reference to "the Company" therein. (ii) Section 9.01 of the Basic Agreement shall be amended by adding the phrase "but with, in the case of clauses (2), (4), (5), (7) and (13) below, the consent of the Policy Provider" immediately after the phrase "Without the consent of any Certificateholders,". (iii) Section 9.01 of the Basic Agreement shall be amended by adding the phrase "the Policy and the Policy Provider Agreement," after each reference to "Intercreditor Agreement" therein (except for the second such reference in subparagraph (7) thereof). (iv) Section 9.02 of the Basic Agreement shall be amended by (A) adding the phrase "and upon the prior written consent of the Policy Provider" immediately after the phrase "by Direction of said Certificateholders delivered to the Company and the Trustee," appearing in the fifth line thereof and (B) by adding the phrase "the Policy Provider and" immediately after the phrase "provided, however, that no such agreement shall, without the consent of" appearing in the 13th line thereof. (v) Section 9.02 of the Basic Agreement shall be amended by (i) adding the phrase "the Policy and the Policy Provider Agreement," after each reference to "Intercreditor Agreement" therein (except for such reference in subparagraph (3) thereof) and (ii) adding the following as clause (6) thereof: "(6) terminate the Policy or modify the Policy other than amendments already contemplated or required by Section 3.06 of the Policy Provider Agreement." (vi) Section 9.04 of the Basic Agreement shall be amended by inserting the phrase "(which opinion shall also be addressed to the Policy Provider)" immediately before the period at the end of such Section. (vii) Section 10.01 of the Basic Agreement shall be amended by inserting at the beginning of the second sentence thereof the phrase "Subject to Section 8.01(b) of the Intercreditor Agreement (as defined in Trust Supplement No. 2002-1G-2 dated as of April 30, 2002),". (b) Promptly following (i) May 1, 2003 (the "Reoptimization Cut-off Date"), if there has been any change in the information set forth in clauses (x) and (y) below from that set forth in page S-32 of the Prospectus Supplement as a result of any sale/leaseback transaction with respect to any Boeing 737-832 Aircraft, and (ii) any early redemption or purchase of, or any default in the payment of principal or interest in respect of, any of the Series G-2 Equipment Notes held in the Class G-2 Trust, the Trustee shall furnish to Class G-2 Certificateholders of record on such date a statement setting forth (x) the expected Pool Factors for each subsequent Regular Distribution Date following the Reoptimization Cut-off Date and (y) the expected principal distribution schedule of the Series G-2 Equipment Notes, in the aggregate, held as Trust Property at the date of such notice. With respect to the Class G-2 Certificates registered in the name of a Clearing Agency, on the Reoptimization Cut-off Date, the Trustee will request from such Clearing Agency a securities position listing setting forth the names of all Clearing Agency Participants reflected on such Clearing Agency's books as holding interests in the Class G-2 Certificates on such date. The Trustee will mail to each such Clearing Agency Participant the statement described above and will make available additional copies as requested by such Clearing Agency Participant for forwarding to holders of interests in the Class G-2 Certificates. (c) The Trustee agrees to send to S&P (at its address at 55 Water Street, 39th Floor, New York, New York, 10041-0003, Attention: Philip A. Baggaley, or such other address as S&P may notify the Trustee) and the Policy Provider (at its address specified in the Intercreditor Agreement) a copy of each notice, statement, report or other written communication sent by the Trustee to each Class G-2 Certificateholder. ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.01 Final Termination Date. The respective obligations and responsibilities of the Company and the Trustee created hereby and the Class G-2 Trust created hereby shall terminate upon the distribution to all Certificateholders of Class G-2 Certificates and the Trustee of all amounts required to be distributed to them pursuant to this Agreement and the disposition of all property held as part of the Trust Property; provided, however, that in no event shall the Trust created hereby continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, Sr., the father of John F. Kennedy, former President of the United States, living on the date of this Trust Supplement. Section 6.02 Basic Agreement Ratified. Except and so far as herein expressly provided, all of the provisions, terms and conditions of the Basic Agreement are in all respects ratified and confirmed; and the Basic Agreement and this Trust Supplement shall be taken, read and construed as one and the same instrument. Section 6.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT AND THE CLASS G-2 CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 6.04 Counterparts. This Trust Supplement may be executed in any number of counterparts (and each of the parties shall not be required to execute the same counterpart). Each counterpart of this Trust Supplement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Trust Supplement, but all of such counterparts together shall constitute one instrument. Section 6.05 Intention of Parties. The parties hereto intend that the Class G-2 Trust be classified for United States federal income tax purposes as a grantor trust under Subpart E, Part I, Subchapter J, Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended, and not as a trust or association taxable as a corporation or as a partnership. Each Certificateholder of a Class G-2 Certificate, by its acceptance of its Class G-2 Certificate or a beneficial interest therein, agrees to treat the Class G-2 Trust as a grantor trust for all United States federal, state and local income tax purposes. The Trustee shall not be authorized or empowered to do anything that would cause the Class G-2 Trust to fail to qualify as a grantor trust for such tax purposes (including as subject to this restriction, acquiring any Aircraft by bidding the Equipment Notes relating thereto or otherwise, or taking any action with respect to any such Aircraft once acquired). IN WITNESS WHEREOF, the parties have caused this Trust Supplement to be duly executed by their respective officers thereto duly authorized as of the date first written above. DELTA AIR LINES, INC. By: ____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ____________________________________ Name: Title: EXHIBIT A to TRUST SUPPLEMENT NO. 2002-1G-2 FORM OF CERTIFICATE *Unless this Certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent for registration of transfer, exchange or payment, and any Certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. - ---------- * This legend to appear on Book-Entry Certificates to be deposited with The Depository Trust Company. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1G-2 6.417% DELTA AIR LINES PASS THROUGH CERTIFICATE, SERIES 2002-1G-2 Final Expected Regular Distribution Date: July 2, 2012 evidencing a fractional undivided interest in a Trust, the property of which includes or will include, among other things, certain Equipment Notes each secured by an Aircraft owned by Delta Air Lines, Inc. Certificate No. ______ $____________ Fractional CUSIP No. _______ Undivided Interest representing [__________]% of the Trust per $1,000 face amount THIS CERTIFIES THAT ________, for value received, is the registered owner of a $______ (______ dollars) Fractional Undivided Interest in the Delta Air Lines Pass Through Trust, Series 2002-1G-2 (the "Trust") created by STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as trustee (the "Trustee"), pursuant to a Pass Through Trust Agreement, dated as of November 16, 2000 (the "Basic Agreement"), as supplemented by Trust Supplement No. 2002-1G-2 thereto dated as of April 30, 2002 (collectively, the "Agreement"), between the Trustee and Delta Air Lines, Inc., a corporation incorporated under Delaware law (the "Company"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in the Agreement. This Certificate is one of the duly authorized Certificates designated as "6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2" (herein called the "Certificates"). This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement. By virtue of its acceptance hereof, the Certificateholder of this Certificate assents to and agrees to be bound by all of the provisions of the Agreement and the Intercreditor Agreement, including the subordination provisions of Section 9.09 of the Intercreditor Agreement. The property of the Trust includes or will include certain Equipment Notes and all rights of the Trust and the Trustee, on behalf of the Trust, to receive any payments under the Intercreditor Agreement or the Liquidity Facility (the "Trust Property"). Each issue of the Equipment Notes is or will be secured by, among other things, a security interest in certain Aircraft owned by or leased to the Company. The Certificates represent Fractional Undivided Interests in the Trust and the Trust Property, and will have no rights, benefits or interest in respect of any other separate trust established pursuant to the terms of the Basic Agreement for any other series of certificates issued pursuant thereto. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, from funds then available to the Trustee, there will be distributed on each January 2 and July 2 (a "Regular Distribution Date"), commencing on January 2, 2003, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Regular Distribution Date, an amount in respect of the Scheduled Payments on the Equipment Notes due on such Regular Distribution Date, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Scheduled Payments. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, in the event that Special Payments on the Equipment Notes are received by the Trustee, from funds then available to the Trustee, there shall be distributed on the applicable Special Distribution Date, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Special Distribution Date, an amount in respect of such Special Payments on the Equipment Notes, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Special Payments so received. If a Regular Distribution Date or Special Distribution Date is not a Business Day, distribution shall be made on the immediately following Business Day with the same force and effect as if made on such Regular Distribution Date or Special Distribution Date and no interest shall accrue during the intervening period. The Trustee shall mail notice of each Special Payment and the Special Distribution Date therefor to the Certificateholder of this Certificate. Distributions on this Certificate will be made by the Trustee by check mailed to the Person entitled thereto, without the presentation or surrender of this Certificate or the making of any notation hereon, except that with respect to Certificates registered on the Record Date in the name of a Clearing Agency (or its nominee), such distributions shall be made by wire transfer. Except as otherwise provided in the Agreement and notwithstanding the above, the final distribution on this Certificate will be made after notice mailed by the Trustee of the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or agency of the Trustee specified in such notice. The Certificates do not represent a direct obligation of, or an obligation guaranteed by, or an interest in, the Company, the Trustee or any Loan Trustee or any Affiliate thereof. The Certificates are limited in right of payment, all as more specifically set forth on the face hereof and in the Agreement. All payments or distributions made to Certificateholders under the Agreement shall be made only from the Trust Property and only to the extent that the Trustee shall have sufficient income or proceeds from the Trust Property to make such payments in accordance with the terms of the Agreement. Each Certificateholder of this Certificate, by its acceptance hereof, agrees that it will look solely to the income and proceeds from the Trust Property to the extent available for any payment or distribution to such Certificateholder pursuant to the terms of the Agreement and that it will not have any recourse to the Company, any Owner Trustee, the Trustee or the Loan Trustees except as otherwise expressly provided in the Agreement, in any Note Document or in the Intercreditor Agreement. This Certificate does not purport to summarize the Agreement and reference is made to the Agreement for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby. A copy of the Agreement may be examined during normal business hours at the principal office of the Trustee, and at such other places, if any, designated by the Trustee, by any Certificateholder upon request. The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Certificateholders under the Agreement at any time by the Company and the Trustee with the consent of the Certificateholders holding Certificates evidencing Fractional Undivided Interests aggregating not less than a majority in interest in the Trust. Any such consent by the Certificateholder of this Certificate shall be conclusive and binding on such Certificateholder and upon all future Certificateholders of this Certificate and of any Certificate issued upon the transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Certificateholders of any of the Certificates. As provided in the Agreement and subject to certain limitations set forth therein, the transfer of this Certificate is registrable in the Register upon surrender of this Certificate for registration of transfer at the offices or agencies maintained by the Trustee in its capacity as Registrar, or by any successor Registrar duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Registrar, duly executed by the Certificateholder hereof or such Certificateholder's attorney duly authorized in writing, and thereupon one or more new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust will be issued to the designated transferee or transferees. The Certificates are issuable only as registered Certificates without coupons in minimum denominations of $1,000 Fractional Undivided Interest and integral multiples thereof except that one Certificate may be issued in a different denomination. As provided in the Agreement and subject to certain limitations therein set forth, the Certificates are exchangeable for new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust, as requested by the Certificateholder surrendering the same. No service charge will be made for any such registration of transfer or exchange, but the Trustee shall require payment of a sum sufficient to cover any tax or governmental charge payable in connection therewith. The Company, the Trustee, the Registrar and any Paying Agent shall deem and treat the person in whose name this Certificate is registered as the owner hereof for all purposes, and none of the Company, the Trustee, the Registrar or any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Agreement and the Trust created thereby shall terminate upon the distribution to Certificateholders of all amounts required to be distributed to them pursuant to the Agreement and the disposition of all property held as part of the Trust Property. Any Person acquiring or accepting this Certificate or an interest herein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either: (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase this Certificate or an interest herein or (ii) the purchase and holding of this Certificate or interest herein by such Person are exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. THIS CERTIFICATE AND THE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES AND CERTIFICATEHOLDERS HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Unless the certificate of authentication hereon has been executed by the Trustee, by manual signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose. IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1G-2 By: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ____________________________________ Title: Dated: FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Certificates referred to in the within-mentioned Agreement. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ____________________________________ Authorized Officer EXHIBIT B to TRUST SUPPLEMENT NO. 2002-1G-2 [DTC Letter of Representations] [Intentionally Omitted] N372DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,073,800.00 N373DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,073,800.00 N374DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,075,200.00 N375DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,075,200.00 N396DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,125,600.00 N397DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,125,600.00 N398DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,125,600.00 N399DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,125,600.00 N3730B --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,128,400.00 N3764D --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3765 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3766 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3767 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3768 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3769L --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N37700 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N3771K --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 1,156,400.00 N67171 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 16,892,444.59 N185DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 19,091,193.30 N186DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 19,091,193.26 N187DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 19,915,297.95 N188DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 19,915,297.95 N189DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 20,739,402.65 N190DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 20,739,402.65 N191DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 20,739,402.65 N192DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 20,739,402.65 N828MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 28,775,551.40 N829MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 28,774,313.79 N830MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 28,891,030.48 N831MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 28,891,030.48 N832MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 28,891,030.48 N833MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments ------------ ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 29,011,605.76 SCHEDULE I-B to TRUST SUPPLEMENT NO. 2002-1G-2 AGGREGATE EQUIPMENT NOTE PRINCIPAL PAYMENTS Payment Date Scheduled Principal Payments --------------- ---------------------------- April 30, 2002 January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 0.00 July 2, 2004 0.00 January 2, 2005 0.00 July 2, 2005 0.00 January 2, 2006 0.00 July 2, 2006 0.00 January 2, 2007 0.00 July 2, 2007 0.00 January 2, 2008 0.00 July 2, 2008 0.00 January 2, 2009 0.00 July 2, 2009 0.00 January 2, 2010 0.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 July 2, 2012 370,286,000.00 SCHEDULE II to TRUST SUPPLEMENT NO. 2002-1G-2 EQUIPMENT NOTES, PRINCIPAL AMOUNTS AND MATURITIES Equipment Notes Principal Amount Maturity --------------- --------------- ------------ N372DA 1,073,800.00 July 2, 2012 N373DA 1,073,800.00 July 2, 2012 N374DA 1,075,200.00 July 2, 2012 N375DA 1,075,200.00 July 2, 2012 N396DA 1,125,600.00 July 2, 2012 N397DA 1,125,600.00 July 2, 2012 N398DA 1,125,600.00 July 2, 2012 N399DA 1,128,400.00 July 2, 2012 N3730B 1,128,400.00 July 2, 2012 N3764D 1,156,400.00 July 2, 2012 N3765 1,156,400.00 July 2, 2012 N3766 1,156,400.00 July 2, 2012 N3767 1,156,400.00 July 2, 2012 N3768 1,156,400.00 July 2, 2012 N3769L 1,156,400.00 July 2, 2012 N37700 1,159,200.00 July 2, 2012 N3771K 1,159,200.00 July 2, 2012 N67171 16,892,444.59 July 2, 2012 N185DN 19,091,193.30 July 2, 2012 N186DN 19,091,193.26 July 2, 2012 N187DN 19,915,297.95 July 2, 2012 N188DN 19,915,297.95 July 2, 2012 N189DN 20,739,402.65 July 2, 2012 N190DN 20,739,402.65 July 2, 2012 N191DN 20,739,402.65 July 2, 2012 N192DN 20,739,402.65 July 2, 2012 N828MH 28,775,551.40 July 2, 2012 N829MH 28,774,313.79 July 2, 2012 N830MH 28,891,030.48 July 2, 2012 N831MH 28,891,030.48 July 2, 2012 N832MH 28,891,030.48 July 2, 2012 N833MH 29,011,605.76 July 2, 2012 SCHEDULE III to TRUST SUPPLEMENT NO. 2002-1G-2 AIRCRAFT Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH SCHEDULE IV to TRUST SUPPLEMENT NO. 2002-1G-2 NOTE DOCUMENTS Participation Agreement Indenture and Security Agreement Series 2002-1G-1 Equipment Note Series 2002-1G-2 Equipment Note Series 2002-1C Equipment Note Series 2002-1D Equipment Note For each of the following aircraft (except for the B737-832 aircraft, for which there is no Series 2002-1D Equipment Note): Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH EX-4.(A)(5) 5 de763576-ex4a5.txt TRUST SUP. NO. 2002-1C Exhibit 4(a)(5) TRUST SUPPLEMENT NO. 2002-1C Dated as of April 30, 2002 between DELTA AIR LINES, INC. and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee, To PASS THROUGH TRUST AGREEMENT Dated as of November 16, 2000 Delta Air Lines, Inc. Pass Through Trust 2002-1C 7.779% Delta Air Lines Pass Through Certificates, Series 2002-1C TRUST SUPPLEMENT NO. 2002-1C This TRUST SUPPLEMENT NO. 2002-1C, dated as of April 30, 2002 (the "Trust Supplement"), between DELTA AIR LINES, INC., a Delaware corporation, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as Trustee, to the Pass Through Trust Agreement, dated as of November 16, 2000, between the Company (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01) and the Trustee (the "Basic Agreement"). W I T N E S S E T H: WHEREAS, the Basic Agreement, which is unlimited as to the aggregate face amount of Certificates that may be issued and authenticated thereunder, has heretofore or concurrently herewith been executed and delivered; WHEREAS, subject to clause (ii) of this recital, (i) pursuant to each Indenture with respect to an Aircraft owned by Delta at the time such Indenture is entered into (an "Owned Aircraft"), Delta will issue on a recourse basis four (or, in the case of a Boeing 737-832 Aircraft, three) series of Equipment Notes secured by such Aircraft and (ii) if an Aircraft becomes subject to a sale/leaseback transaction at any time after the date hereof (a "Leased Aircraft"), pursuant to an Indenture with respect to such Aircraft, as amended and restated in connection with such sale/leaseback transaction, the Owner Trustee will assume on a non-recourse basis Delta's obligations in respect of the Equipment Notes secured by such Aircraft, subject to re-optimization of such Equipment Notes (if such sale/leaseback transaction occurs prior to May 1, 2003); WHEREAS, the Trustee shall hereby declare the creation of the Class C Trust (as defined below) for the benefit of Holders of the Class C Certificates (as defined below) to be issued in respect of such Class C Trust, and the initial Holders of the Class C Certificates, as grantors of such Class C Trust, by their respective acceptances of the Class C Certificates, shall join in the creation of the Class C Trust with the Trustee; WHEREAS, all Certificates to be issued by the Class C Trust will evidence Fractional Undivided Interests in the Class C Trust and will have no rights, benefits or interests in respect of any other separate Trust or the property held therein; WHEREAS, pursuant to the terms and conditions of the Basic Agreement, as supplemented by this Trust Supplement and the Participation Agreements, the Trustee on behalf of the Class C Trust shall purchase the Equipment Notes issued by the Company pursuant to the Indentures relating to the Aircraft having the identical interest rate as, and final maturity dates not later than the final Regular Distribution Date of, the Class C Certificates issued hereunder and shall hold such Equipment Notes in trust for the benefit of the Class C Certificateholders; WHEREAS, pursuant to the terms and conditions of the Intercreditor Agreement referred to in Section 3.01(h) hereof (the "Intercreditor Agreement"), the Trustee and the other parties thereto will agree to the terms of subordination set forth therein; WHEREAS, all of the conditions and requirements necessary to make this Trust Supplement, when duly executed and delivered, a valid, binding and legal instrument in accordance with its terms and for the purposes herein expressed, have been done, performed and fulfilled, and the execution and delivery of this Trust Supplement in the form and with the terms hereof have been in all respects duly authorized; WHEREAS, this Trust Supplement is subject to the provisions of the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions; NOW THEREFORE, in consideration of the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. Unless otherwise specified herein or the context otherwise requires, capitalized terms used but not defined herein shall have the respective meanings set forth, and shall be construed and interpreted in the manner described, in the Basic Agreement or, to the extent not defined therein, in the Intercreditor Agreement. ARTICLE II DECLARATION OF TRUST Section 2.01 Declaration of Trust. The Trustee hereby declares the creation of a Trust, designated the "Delta Air Lines Pass Through Trust 2002-1C" (the "Class C Trust"), for the benefit of the Holders of the Class C Certificates to be issued in respect of such Class C Trust, and the initial Holders of the Class C Certificates, as grantors of such Class C Trust, by their respective acceptances of the Class C Certificates, join in the creation of such Class C Trust with the Trustee. The Trustee, by the execution and delivery of this Trust Supplement, acknowledges its acceptance of all right, title and interest in and to the Trust Property to be acquired pursuant to Section 2.02 of the Basic Agreement and the Participation Agreements and the Trustee will hold such right, title and interest for the benefit of all present and future Holders of the Class C Certificates, upon the trusts set forth in the Basic Agreement and this Trust Supplement. ARTICLE III THE CERTIFICATES Section 3.01 The Certificates. There is hereby created a series of Certificates to be issued under this Agreement designated as "7.779% Delta Air Lines Pass Through Certificates, Series 2002-1C" (the "Class C Certificates"). Each Class C Certificate represents a Fractional Undivided Interest in the Class C Trust created hereby. The Class C Certificates shall be the only instruments evidencing a Fractional Undivided Interest in the Class C Trust. The terms and conditions applicable to the Class C Certificates and the Class C Trust are as follows: (a) The aggregate face amount of the Class C Certificates that may be authenticated and delivered under this Agreement (except for Class C Certificates authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Class C Certificates pursuant to Sections 3.03, 3.04, 3.05 and 3.06 of the Basic Agreement) is $168,684,000. (b) The Cut-off Date is May 28, 2002. (c) The Regular Distribution Dates with respect to any payment of Scheduled Payments means January 2 and July 2 of each year, commencing on January 2, 2003, until payment of all of the Scheduled Payments to be made under the Equipment Notes has been made. The principal amount of the Equipment Notes to be held by the Class C Trust is scheduled for payment on January 2 and July 2 in certain years, beginning on January 2, 2003 and ending on January 2, 2012, as set out in Schedules I-A and I-B. (d) The Special Distribution Dates with respect to the Class C Certificates means any Business Day on which a Special Payment is to be distributed pursuant to this Agreement. (e) The Class C Certificates shall be in the form attached hereto as Exhibit A, shall be Book-Entry Certificates and shall be subject to the conditions set forth in the Letter of Representations between the Company and The Depository Trust Company, as initial Clearing Agency, attached hereto as Exhibit B. (f) The proceeds of the Class C Certificates issued by the Class C Trust shall be used to acquire the Equipment Notes described in Schedule II, such Equipment Notes to relate to the Aircraft described in Schedule III and the Note Documents described in Schedule IV. (g) Any Person acquiring or accepting a Class C Certificate or an interest therein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase Class C Certificates or an interest therein or (ii) the purchase and holding of Class C Certificates or interests therein by such Person is exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. "Plan" means a retirement plan or other employee benefit plan or arrangement, including for this purpose an individual retirement account, annuity or Keogh plan, that is subject to Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal Revenue Code of 1986 (the "Code"), or such a plan or arrangement which is a foreign, church or governmental plan or arrangement exempt from Title I of ERISA and Section 4975 of the Code but subject to a foreign, federal, state, or local law which is substantially similar to the provisions of Title I of ERISA or Section 4975 of the Code (each, a "Similar Law"). (h) The Class C Certificates will be subject to the following Intercreditor Agreement (and to the extent the terms thereof (including the definitions of defined terms) are inconsistent with the terms of this Agreement, such Intercreditor Agreement shall control): that certain Intercreditor Agreement, dated as of the date hereof, among State Street Bank and Trust Company of Connecticut, National Association, as Trustee under each Trust (as defined therein), MBIA Insurance Corporation, as the Policy Provider, Westdeutsche Landesbank Girozentrale, New York Branch, as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider and Class C Liquidity Provider, and State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent thereunder. Potential Purchasers shall have the rights upon the occurrence of a Triggering Event set forth in Article IV hereof. The Trustee and, by acceptance of any Class C Certificate, each Certificateholder thereof, agrees to be bound by all of the provisions of the Intercreditor Agreement, including the subordination provisions of Section 9.09 thereof. (i) The Class C Certificates will have the benefit of the following Liquidity Facility: that certain Revolving Credit Agreement, dated as of the date hereof, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent under the Intercreditor Agreement, as agent and trustee for the Class C Trust, and Westdeutsche Landesbank Girozentrale, New York Branch. (j) Subject to Section 2.02(b) of the Basic Agreement, there will not be any deposit agreement, escrow agreement or other similar arrangement prior to delivery of the Aircraft. (k) The Company may at any time purchase any of the Class C Certificates at any price in the open market and may hold such Class C Certificates to maturity. (l) The Responsible Party is the Company. Section 3.02 Delivery of Documents. The Trustee is hereby directed (i) to execute and deliver the Intercreditor Agreement referred to in Section 3.01(h) of this Trust Supplement, in the form delivered to the Trustee by the Company and (ii) subject to the respective terms thereof, to perform its obligations thereunder. ARTICLE IV DEFAULT Section 4.01 Purchase Rights of Certificateholders. (a) By acceptance of its Class C Certificate, each Class C Certificateholder agrees that at any time after the occurrence and during the continuation of a Triggering Event, (i) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to the Class G-2 Trust Agreement and the Class G-1 Trust Agreement, each Class C Certificateholder shall have the right (which shall not expire upon any purchase of the Class G-1 Certificates pursuant to the Class G-2 Trust Agreement or the Class G-2 Certificates pursuant to the Class G-1 Trust Agreement) to purchase, for the price set forth in the Class G-1 Trust Agreement and the Class G-2 Trust Agreement, respectively, all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates upon ten days' prior written notice to the Class G-1 Trustee, the Class G-2 Trustee and each other Class C Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class C Certificateholder notifies such purchasing Class C Certificateholder that such other Class C Certificateholder wants to participate in such purchase, then such other Class C Certificateholder may join with the purchasing Class C Certificateholder to purchase all, but not less than all, of the Class C Certificates and the Class G-2 Certificates pro rata based on the Fractional Undivided Interest in the Class C Trust held by each such Class C Certificateholder and (B) if prior to the end of such ten-day period any other Class C Certificateholder fails to notify the purchasing Class C Certificateholder of such other Class C Certificateholder's desire to participate in such a purchase, then such other Class C Certificateholder shall lose its right to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to this Section 4.01(a)(i); and (ii) unless the Policy Provider has purchased or given notice of its election to purchase the Class G-1 Certificates and the Class G-2 Certificates pursuant to the Class G-2 Trust Agreement and the Class G-1 Trust Agreement, (it being understood that such purchase or election to purchase shall not affect the rights of the Class D Certificateholders with respect to the purchase of the Class C Certificates), each Class D Certificateholder (other than the Company or any of its Affiliates) shall have the right (which shall not expire upon any purchase of the Class G-1 Certificates pursuant to the Class G-2 Trust Agreement, the Class G-2 Certificates pursuant to the Class G-1 Trust Agreement or the Class G-1 Certificates and the Class G-2 Certificates pursuant to Clause (i) above) to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates upon ten days' prior written notice to the Trustee, the Class G-1 Trustee, the Class G-2 Trustee, the Class C Trustee and each other Class D Certificateholder, provided that (A) if prior to the end of such ten-day period any other Class D Certificateholder notifies such purchasing Class D Certificateholder that such other Class D Certificateholder wants to participate in such purchase, then such other Class D Certificateholder may join with the purchasing Class D Certificateholder to purchase all, but not less than all, of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pro rata based on the Fractional Undivided Interest in the Class D Trust held by each such Class D Certificateholder and (B) if prior to the end of such ten-day period any other Class D Certificateholder fails to notify the purchasing Class D Certificateholder of such other Class D Certificateholder's desire to participate in such a purchase, then such other Class D Certificateholder shall lose its right to purchase the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates pursuant to this Section 4.01(a)(ii); and (iii) whether or not any Class C or Class D Certificateholders have exercised their purchase rights pursuant to paragraph (i) or (ii) above, the Policy Provider (except in the event of a Policy Provider Default), if it is then the Controlling Party, shall have the right to purchase all, but not less than all, of the Class G-1 Certificates and the Class G-2 Certificates in the manner provided in the Class G-1 Trust Agreement and the Class G-2 Trust Agreement. The purchase price with respect to the Class C Certificates shall be equal to the Pool Balance of the Class C Certificates, together with accrued and unpaid interest in respect thereof to the date of such purchase, without premium, but including any other amounts then due and payable to the Class C Certificateholders under this Agreement, the Intercreditor Agreement or any Note Document or on or in respect of the Class C Certificates; provided, however, that if such purchase occurs after the Record Date relating to any Distribution Date, such purchase price shall be reduced by the amount to be distributed hereunder on such related Distribution Date (which deducted amounts shall remain distributable to, and may be retained by, the Class C Certificateholders as of such Record Date); provided, further that no such purchase of Class C Certificates pursuant to this Section 4.01(a) shall be effective unless the purchaser(s) shall certify to the Trustee that contemporaneously with such purchase, such purchaser(s) is purchasing, pursuant to the terms of this Agreement and the Intercreditor Agreement, all of the Class G-1 Certificates, the Class G-2 Certificates and the Class C Certificates that are senior to the securities held by such purchaser(s), subject to the purchase rights of the Policy Provider provided in Section 4.01(a)(iii) hereof. Each payment of the purchase price of the Class C Certificates referred to in the first sentence hereof shall be made to an account or accounts designated by the Trustee and each such purchase shall be subject to the terms of this Section 4.01(a). Each Class C Certificateholder agrees by its acceptance of its Certificate that it will, upon payment from such Class D Certificateholder(s) of the purchase price set forth in the first sentence of this paragraph, forthwith sell, assign, transfer and convey to the purchaser(s) thereof (without recourse, representation or warranty of any kind except as to its own acts) all of the right, title, interest and obligation of such Class C Certificateholder in this Agreement, the Intercreditor Agreement, the Class C Liquidity Facility, the Note Documents and all Class C Certificates held by such Class C Certificateholder (excluding all right, title and interest under any of the foregoing to the extent such right, title or interest is with respect to an obligation not then due and payable as respects any action or inaction or state of affairs occurring prior to such sale) and the purchaser(s) shall assume all of such Class C Certificateholder's obligations under this Agreement, the Intercreditor Agreement, the Class C Liquidity Facility, the Note Documents and all such Class C Certificates. The Class C Certificates will be deemed to be purchased on the date payment of the purchase price is made notwithstanding the failure of any Class C Certificateholder to deliver any Class C Certificate and, upon such a purchase, (i) the only rights of the Class C Certificateholders will be to deliver the Class C Certificates and (ii) if the purchaser(s) shall so request, each such Class C Certificateholder will comply with all the provisions of Section 3.04 of the Basic Agreement to enable new Class C Certificates to be issued to the purchaser(s) in such denominations as it shall request. All charges and expenses in connection with the issuance of any such new Class C Certificates shall be borne by the purchaser(s) thereof. (b) This Section 4.01 supplements and, to the extent inconsistent with any provision of Section 6.01(a) of the Basic Agreement, replaces the provisions of Section 6.01(a) of the Basic Agreement. Notwithstanding anything to the contrary set forth herein or in any Operative Agreement, the provisions of this Section 4.01 may not be amended in any manner without the consent of each Class G-1 Certificateholder, Class G-2 Certificateholder, Class C Certificateholder or Class D Certificateholder (other than the Company or any of its Affiliates) that would be adversely affected thereby, or the Policy Provider, if it would be adversely affected thereby. ARTICLE V SUPPLEMENTAL AGREEMENTS Section 5.01 Supplemental Agreements. (a) Promptly following (i) May 1, 2003 (the "Reoptimization Cut-off Date"), if there has been any change in the information set forth in clauses (x) and (y) below from that set forth in page S-32 of the Prospectus Supplement as a result of any sale/leaseback transaction with respect to any Boeing 737-832 Aircraft, and (ii) any early redemption or purchase of, or any default in the payment of principal or interest in respect of, any of the Series C Equipment Notes held in the Class C Trust, the Trustee shall furnish to Class C Certificateholders of record on such date a statement setting forth (x) the expected Pool Factors for each subsequent Regular Distribution Date following the Reoptimization Cut-off Date and (y) the expected principal distribution schedule of the Series C Equipment Notes, in the aggregate, held as Trust Property at the date of such notice. With respect to the Class C Certificates registered in the name of a Clearing Agency, on the Reoptimization Cut-off Date, the Trustee will request from such Clearing Agency a securities position listing setting forth the names of all Clearing Agency Participants reflected on such Clearing Agency's books as holding interests in the Class C Certificates on such date. The Trustee will mail to each such Clearing Agency Participant the statement described above and will make available additional copies as requested by such Clearing Agency Participant for forwarding to holders of interests in the Class C Certificates. (b) The Trustee agrees to send to S&P (at its address at 55 Water Street, 39th Floor, New York, New York, 10041-0003, Attention: Philip A. Baggaley, or such other address as S&P may notify the Trustee) a copy of each notice, statement, report or other written communication sent by the Trustee to each Class C Certificateholder. ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.01 Final Termination Date. The respective obligations and responsibilities of the Company and the Trustee created hereby and the Class C Trust created hereby shall terminate upon the distribution to all Certificateholders of Class C Certificates and the Trustee of all amounts required to be distributed to them pursuant to this Agreement and the disposition of all property held as part of the Trust Property; provided, however, that in no event shall the Trust created hereby continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, Sr., the father of John F. Kennedy, former President of the United States, living on the date of this Trust Supplement. Section 6.02 Basic Agreement Ratified. Except and so far as herein expressly provided, all of the provisions, terms and conditions of the Basic Agreement are in all respects ratified and confirmed; and the Basic Agreement and this Trust Supplement shall be taken, read and construed as one and the same instrument. Section 6.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT AND THE CLASS C CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 6.04 Counterparts. This Trust Supplement may be executed in any number of counterparts (and each of the parties shall not be required to execute the same counterpart). Each counterpart of this Trust Supplement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Trust Supplement, but all of such counterparts together shall constitute one instrument. Section 6.05 Intention of Parties. The parties hereto intend that the Class C Trust be classified for United States federal income tax purposes as a grantor trust under Subpart E, Part I, Subchapter J, Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended, and not as a trust or association taxable as a corporation or as a partnership. Each Certificateholder of a Class C Certificate, by its acceptance of its Class C Certificate or a beneficial interest therein, agrees to treat the Class C Trust as a grantor trust for all United States federal, state and local income tax purposes. The Trustee shall not be authorized or empowered to do anything that would cause the Class C Trust to fail to qualify as a grantor trust for such tax purposes (including as subject to this restriction, acquiring any Aircraft by bidding the Equipment Notes relating thereto or otherwise, or taking any action with respect to any such Aircraft once acquired). IN WITNESS WHEREOF, the parties have caused this Trust Supplement to be duly executed by their respective officers thereto duly authorized as of the date first written above. DELTA AIR LINES, INC. By: -------------------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: -------------------------------------------- Name: Title: EXHIBIT A to TRUST SUPPLEMENT NO. 2002-1C FORM OF CERTIFICATE [*]Unless this Certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent for registration of transfer, exchange or payment, and any Certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. - ------------------------------------ [*] This legend to appear on Book-Entry Certificates to be deposited with The Depository Trust Company. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1C 7.779% DELTA AIR LINES PASS THROUGH CERTIFICATE, SERIES 2002-1C Final Expected Regular Distribution Date: January 2, 2012 evidencing a fractional undivided interest in a Trust, the property of which includes or will include, among other things, certain Equipment Notes each secured by an Aircraft owned by Delta Air Lines, Inc. Certificate No. ______ $____________ Fractional Undivided CUSIP No. ______ Interest representing [ ]% of the Trust per $1,000 face amount THIS CERTIFIES THAT ________, for value received, is the registered owner of a $______ (______ dollars) Fractional Undivided Interest in the Delta Air Lines Pass Through Trust, Series 2002-1C (the "Trust") created by STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as trustee (the "Trustee"), pursuant to a Pass Through Trust Agreement, dated as of November 16, 2000 (the "Basic Agreement"), as supplemented by Trust Supplement No. 2002-1C thereto dated as of April 30, 2002 (collectively, the "Agreement"), between the Trustee and Delta Air Lines, Inc., a corporation incorporated under Delaware law (the "Company"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in the Agreement. This Certificate is one of the duly authorized Certificates designated as "7.779% Delta Air Lines Pass Through Certificates, Series 2002-1C" (herein called the "Certificates"). This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement. By virtue of its acceptance hereof, the Certificateholder of this Certificate assents to and agrees to be bound by all of the provisions of the Agreement and the Intercreditor Agreement, including the subordination provisions of Section 9.09 of the Intercreditor Agreement. The property of the Trust includes or will include certain Equipment Notes and all rights of the Trust and the Trustee, on behalf of the Trust, to receive any payments under the Intercreditor Agreement or the Liquidity Facility (the "Trust Property"). Each issue of the Equipment Notes is or will be secured by, among other things, a security interest in certain Aircraft owned by or leased to the Company. The Certificates represent Fractional Undivided Interests in the Trust and the Trust Property, and will have no rights, benefits or interest in respect of any other separate trust established pursuant to the terms of the Basic Agreement for any other series of certificates issued pursuant thereto. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, from funds then available to the Trustee, there will be distributed on each January 2 and July 2 (a "Regular Distribution Date"), commencing on January 2, 2003, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Regular Distribution Date, an amount in respect of the Scheduled Payments on the Equipment Notes due on such Regular Distribution Date, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Scheduled Payments. Subject to and in accordance with the terms of the Agreement and the Intercreditor Agreement, in the event that Special Payments on the Equipment Notes are received by the Trustee, from funds then available to the Trustee, there shall be distributed on the applicable Special Distribution Date, to the Person in whose name this Certificate is registered at the close of business on the 15th day preceding the Special Distribution Date, an amount in respect of such Special Payments on the Equipment Notes, the receipt of which has been confirmed by the Trustee, equal to the product of the percentage interest in the Trust evidenced by this Certificate and an amount equal to the sum of such Special Payments so received. If a Regular Distribution Date or Special Distribution Date is not a Business Day, distribution shall be made on the immediately following Business Day with the same force and effect as if made on such Regular Distribution Date or Special Distribution Date and no interest shall accrue during the intervening period. The Trustee shall mail notice of each Special Payment and the Special Distribution Date therefor to the Certificateholder of this Certificate. Distributions on this Certificate will be made by the Trustee by check mailed to the Person entitled thereto, without the presentation or surrender of this Certificate or the making of any notation hereon, except that with respect to Certificates registered on the Record Date in the name of a Clearing Agency (or its nominee), such distributions shall be made by wire transfer. Except as otherwise provided in the Agreement and notwithstanding the above, the final distribution on this Certificate will be made after notice mailed by the Trustee of the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or agency of the Trustee specified in such notice. The Certificates do not represent a direct obligation of, or an obligation guaranteed by, or an interest in, the Company, the Trustee or any Loan Trustee or any Affiliate thereof. The Certificates are limited in right of payment, all as more specifically set forth on the face hereof and in the Agreement. All payments or distributions made to Certificateholders under the Agreement shall be made only from the Trust Property and only to the extent that the Trustee shall have sufficient income or proceeds from the Trust Property to make such payments in accordance with the terms of the Agreement. Each Certificateholder of this Certificate, by its acceptance hereof, agrees that it will look solely to the income and proceeds from the Trust Property to the extent available for any payment or distribution to such Certificateholder pursuant to the terms of the Agreement and that it will not have any recourse to the Company, any Owner Trustee, the Trustee or the Loan Trustees except as otherwise expressly provided in the Agreement, in any Note Document or in the Intercreditor Agreement. This Certificate does not purport to summarize the Agreement and reference is made to the Agreement for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby. A copy of the Agreement may be examined during normal business hours at the principal office of the Trustee, and at such other places, if any, designated by the Trustee, by any Certificateholder upon request. The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Certificateholders under the Agreement at any time by the Company and the Trustee with the consent of the Certificateholders holding Certificates evidencing Fractional Undivided Interests aggregating not less than a majority in interest in the Trust. Any such consent by the Certificateholder of this Certificate shall be conclusive and binding on such Certificateholder and upon all future Certificateholders of this Certificate and of any Certificate issued upon the transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Certificateholders of any of the Certificates. As provided in the Agreement and subject to certain limitations set forth therein, the transfer of this Certificate is registrable in the Register upon surrender of this Certificate for registration of transfer at the offices or agencies maintained by the Trustee in its capacity as Registrar, or by any successor Registrar duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Registrar, duly executed by the Certificateholder hereof or such Certificateholder's attorney duly authorized in writing, and thereupon one or more new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust will be issued to the designated transferee or transferees. The Certificates are issuable only as registered Certificates without coupons in minimum denominations of $1,000 Fractional Undivided Interest and integral multiples thereof except that one Certificate may be issued in a different denomination. As provided in the Agreement and subject to certain limitations therein set forth, the Certificates are exchangeable for new Certificates of authorized denominations evidencing the same aggregate Fractional Undivided Interest in the Trust, as requested by the Certificateholder surrendering the same. No service charge will be made for any such registration of transfer or exchange, but the Trustee shall require payment of a sum sufficient to cover any tax or governmental charge payable in connection therewith. The Company, the Trustee, the Registrar and any Paying Agent shall deem and treat the person in whose name this Certificate is registered as the owner hereof for all purposes, and none of the Company, the Trustee, the Registrar or any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Agreement and the Trust created thereby shall terminate upon the distribution to Certificateholders of all amounts required to be distributed to them pursuant to the Agreement and the disposition of all property held as part of the Trust Property. Any Person acquiring or accepting this Certificate or an interest herein will, by such acquisition or acceptance, be deemed to represent and warrant to the Company, the Loan Trustees and the Trustee that either: (i) no assets of a Plan or any trust established with respect to a Plan, have been used to purchase this Certificate or an interest herein or (ii) the purchase and holding of this Certificate or interest herein by such Person are exempt from the prohibited transaction restrictions of ERISA and the Code or materially similar provisions of Similar Law pursuant to one or more prohibited transaction statutory or administrative exemptions. THIS CERTIFICATE AND THE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES AND CERTIFICATEHOLDERS HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Unless the certificate of authentication hereon has been executed by the Trustee, by manual signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose. IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed. DELTA AIR LINES, INC. PASS THROUGH TRUST 2002-1C By: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ------------------------------------ Title: Dated: FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Certificates referred to in the within-mentioned Agreement. By: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee By: ------------------------------------- Authorized Officer EXHIBIT B to TRUST SUPPLEMENT NO. 2002-1C [DTC Letter of Representations] [Intentionally Omitted] N372DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 276,120.00 July 2, 2004 0.00 January 2, 2005 138,060.00 July 2, 2005 0.00 January 2, 2006 138,060.00 July 2, 2006 0.00 January 2, 2007 138,060.00 July 2, 2007 0.00 January 2, 2008 138,060.00 July 2, 2008 0.00 January 2, 2009 138,060.00 July 2, 2009 535,454.14 January 2, 2010 2,198,345.45 July 2, 2010 0.00 January 2, 2011 901,780.41 July 2, 2011 0.00 January 2, 2012 0.00 N373DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 276,120.00 July 2, 2004 0.00 January 2, 2005 138,060.00 July 2, 2005 0.00 January 2, 2006 138,060.00 July 2, 2006 0.00 January 2, 2007 138,060.00 July 2, 2007 0.00 January 2, 2008 138,060.00 July 2, 2008 0.00 January 2, 2009 138,060.00 July 2, 2009 535,454.14 January 2, 2010 2,198,345.45 July 2, 2010 0.00 January 2, 2011 901,780.41 July 2, 2011 0.00 January 2, 2012 0.00 N374DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 276,480.00 July 2, 2004 0.00 January 2, 2005 138,240.00 July 2, 2005 0.00 January 2, 2006 138,240.00 July 2, 2006 0.00 January 2, 2007 138,240.00 July 2, 2007 0.00 January 2, 2008 138,240.00 July 2, 2008 0.00 January 2, 2009 138,240.00 July 2, 2009 522,091.06 January 2, 2010 2,222,303.42 July 2, 2010 0.00 January 2, 2011 895,925.53 July 2, 2011 0.00 January 2, 2012 0.00 N375DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $0.00 July 2, 2003 0.00 January 2, 2004 276,480.00 July 2, 2004 0.00 January 2, 2005 138,240.00 July 2, 2005 0.00 January 2, 2006 138,240.00 July 2, 2006 0.00 January 2, 2007 138,240.00 July 2, 2007 0.00 January 2, 2008 138,240.00 July 2, 2008 0.00 January 2, 2009 138,240.00 July 2, 2009 522,091.06 January 2, 2010 2,222,303.42 July 2, 2010 0.00 January 2, 2011 895,925.53 July 2, 2011 0.00 January 2, 2012 0.00 N396DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $144,720.00 July 2, 2003 0.00 January 2, 2004 144,720.00 July 2, 2004 0.00 January 2, 2005 144,720.00 July 2, 2005 0.00 January 2, 2006 144,720.00 July 2, 2006 0.00 January 2, 2007 144,720.00 July 2, 2007 0.00 January 2, 2008 144,720.00 July 2, 2008 0.00 January 2, 2009 144,720.00 July 2, 2009 939,493.83 January 2, 2010 1,674,441.28 July 2, 2010 0.00 January 2, 2011 1,114,942.87 July 2, 2011 0.00 January 2, 2012 82,082.03 N397DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $144,720.00 July 2, 2003 0.00 January 2, 2004 144,720.00 July 2, 2004 0.00 January 2, 2005 144,720.00 July 2, 2005 0.00 January 2, 2006 144,720.00 July 2, 2006 0.00 January 2, 2007 144,720.00 July 2, 2007 0.00 January 2, 2008 144,720.00 July 2, 2008 0.00 January 2, 2009 144,720.00 July 2, 2009 939,493.83 January 2, 2010 1,674,441.28 July 2, 2010 0.00 January 2, 2011 1,114,942.87 July 2, 2011 0.00 January 2, 2012 82,082.03 N398DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $144,720.00 July 2, 2003 0.00 January 2, 2004 144,720.00 July 2, 2004 0.00 January 2, 2005 144,720.00 July 2, 2005 0.00 January 2, 2006 144,720.00 July 2, 2006 0.00 January 2, 2007 144,720.00 July 2, 2007 0.00 January 2, 2008 144,720.00 July 2, 2008 0.00 January 2, 2009 144,720.00 July 2, 2009 939,493.83 January 2, 2010 1,674,441.28 July 2, 2010 0.00 January 2, 2011 1,114,942.87 July 2, 2011 0.00 January 2, 2012 82,082.03 N399DA --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $145,080.00 July 2, 2003 0.00 January 2, 2004 145,080.00 July 2, 2004 0.00 January 2, 2005 145,080.00 July 2, 2005 0.00 January 2, 2006 145,080.00 July 2, 2006 0.00 January 2, 2007 145,080.00 July 2, 2007 0.00 January 2, 2008 145,080.00 July 2, 2008 0.00 January 2, 2009 145,080.00 July 2, 2009 916,250.05 January 2, 2010 1,712,605.19 July 2, 2010 0.00 January 2, 2011 1,113,671.16 July 2, 2011 0.00 January 2, 2012 77,913.60 N3730B --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $145,080.00 July 2, 2003 0.00 January 2, 2004 145,080.00 July 2, 2004 0.00 January 2, 2005 145,080.00 July 2, 2005 0.00 January 2, 2006 145,080.00 July 2, 2006 0.00 January 2, 2007 145,080.00 July 2, 2007 0.00 January 2, 2008 145,080.00 July 2, 2008 0.00 January 2, 2009 145,080.00 July 2, 2009 916,250.05 January 2, 2010 1,712,605.19 July 2, 2010 0.00 January 2, 2011 1,113,671.16 July 2, 2011 0.00 January 2, 2012 77,913.60 N3764D --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 148,680.00 July 2, 2009 1,106,421.59 January 2, 2010 1,532,568.19 July 2, 2010 0.00 January 2, 2011 1,167,782.97 July 2, 2011 0.00 January 2, 2012 108,467.25 N3765 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 148,680.00 July 2, 2009 1,106,421.59 January 2, 2010 1,532,568.19 July 2, 2010 0.00 January 2, 2011 1,167,782.97 July 2, 2011 0.00 January 2, 2012 108,467.25 N3766 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 148,680.00 July 2, 2009 1,106,421.59 January 2, 2010 1,532,568.19 July 2, 2010 0.00 January 2, 2011 1,167,782.97 July 2, 2011 0.00 January 2, 2012 108,467.25 N3767 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 148,680.00 July 2, 2009 1,106,421.59 January 2, 2010 1,532,568.19 July 2, 2010 0.00 January 2, 2011 1,167,782.97 July 2, 2011 0.00 January 2, 2012 108,467.25 N3768 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 274,286.78 July 2, 2009 1,277,817.43 January 2, 2010 1,096,498.78 July 2, 2010 0.00 January 2, 2011 1,234,611.86 July 2, 2011 0.00 January 2, 2012 180,705.15 N3769L --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $148,680.00 July 2, 2003 0.00 January 2, 2004 148,680.00 July 2, 2004 0.00 January 2, 2005 148,680.00 July 2, 2005 0.00 January 2, 2006 148,680.00 July 2, 2006 0.00 January 2, 2007 148,680.00 July 2, 2007 0.00 January 2, 2008 148,680.00 July 2, 2008 0.00 January 2, 2009 274,286.78 July 2, 2009 1,277,817.43 January 2, 2010 1,096,498.78 July 2, 2010 0.00 January 2, 2011 1,234,611.86 July 2, 2011 0.00 January 2, 2012 180,705.15 N37700 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $149,040.00 July 2, 2003 0.00 January 2, 2004 149,040.00 July 2, 2004 0.00 January 2, 2005 149,040.00 July 2, 2005 0.00 January 2, 2006 149,040.00 July 2, 2006 0.00 January 2, 2007 149,040.00 July 2, 2007 0.00 January 2, 2008 149,040.00 July 2, 2008 0.00 January 2, 2009 235,195.79 July 2, 2009 1,333,475.61 January 2, 2010 1,095,211.72 July 2, 2010 0.00 January 2, 2011 1,233,340.15 July 2, 2011 0.00 January 2, 2012 176,536.72 N3771K --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $149,040.00 July 2, 2003 0.00 January 2, 2004 149,040.00 July 2, 2004 0.00 January 2, 2005 149,040.00 July 2, 2005 0.00 January 2, 2006 149,040.00 July 2, 2006 0.00 January 2, 2007 149,040.00 July 2, 2007 0.00 January 2, 2008 149,040.00 July 2, 2008 0.00 January 2, 2009 235,195.79 July 2, 2009 1,333,475.61 January 2, 2010 1,095,211.72 July 2, 2010 0.00 January 2, 2011 1,233,340.15 July 2, 2011 0.00 January 2, 2012 176,536.72 N67171 --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $575,270.78 July 2, 2003 0.00 January 2, 2004 594,386.88 July 2, 2004 0.00 January 2, 2005 643,890.24 July 2, 2005 0.00 January 2, 2006 641,792.64 July 2, 2006 0.00 January 2, 2007 688,359.36 July 2, 2007 0.00 January 2, 2008 525,345.46 July 2, 2008 0.00 January 2, 2009 420,135.60 July 2, 2009 0.00 January 2, 2010 209,304.00 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N185DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $650,146.73 July 2, 2003 0.00 January 2, 2004 671,753.43 July 2, 2004 0.00 January 2, 2005 727,700.24 July 2, 2005 0.00 January 2, 2006 725,329.62 July 2, 2006 0.00 January 2, 2007 777,957.55 July 2, 2007 0.00 January 2, 2008 593,727.85 July 2, 2008 0.00 January 2, 2009 474,821.27 July 2, 2009 0.00 January 2, 2010 236,547.42 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N186DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $650,146.73 July 2, 2003 0.00 January 2, 2004 671,753.43 July 2, 2004 0.00 January 2, 2005 727,700.24 July 2, 2005 0.00 January 2, 2006 725,329.62 July 2, 2006 0.00 January 2, 2007 777,957.55 July 2, 2007 0.00 January 2, 2008 593,727.85 July 2, 2008 0.00 January 2, 2009 474,821.27 July 2, 2009 0.00 January 2, 2010 236,547.42 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N187DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $678,210.65 July 2, 2003 0.00 January 2, 2004 700,750.85 July 2, 2004 0.00 January 2, 2005 759,112.70 July 2, 2005 0.00 January 2, 2006 756,639.74 July 2, 2006 0.00 January 2, 2007 811,539.46 July 2, 2007 0.00 January 2, 2008 619,357.96 July 2, 2008 0.00 January 2, 2009 495,317.76 July 2, 2009 0.00 January 2, 2010 246,758.40 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N188DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $678,210.65 July 2, 2003 0.00 January 2, 2004 700,750.85 July 2, 2004 0.00 January 2, 2005 759,112.70 July 2, 2005 0.00 January 2, 2006 756,639.74 July 2, 2006 0.00 January 2, 2007 811,539.46 July 2, 2007 0.00 January 2, 2008 619,357.96 July 2, 2008 0.00 January 2, 2009 495,317.76 July 2, 2009 0.00 January 2, 2010 246,758.40 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N189DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,274.59 July 2, 2003 0.00 January 2, 2004 729,748.26 July 2, 2004 0.00 January 2, 2005 790,525.16 July 2, 2005 0.00 January 2, 2006 787,949.87 July 2, 2006 0.00 January 2, 2007 845,121.36 July 2, 2007 0.00 January 2, 2008 644,988.06 July 2, 2008 0.00 January 2, 2009 515,814.25 July 2, 2009 0.00 January 2, 2010 256,969.38 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N190DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,274.59 July 2, 2003 0.00 January 2, 2004 729,748.26 July 2, 2004 0.00 January 2, 2005 790,525.16 July 2, 2005 0.00 January 2, 2006 787,949.87 July 2, 2006 0.00 January 2, 2007 845,121.36 July 2, 2007 0.00 January 2, 2008 644,988.06 July 2, 2008 0.00 January 2, 2009 515,814.25 July 2, 2009 0.00 January 2, 2010 256,969.38 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N191DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,274.59 July 2, 2003 0.00 January 2, 2004 729,748.26 July 2, 2004 0.00 January 2, 2005 790,525.16 July 2, 2005 0.00 January 2, 2006 787,949.87 July 2, 2006 0.00 January 2, 2007 845,121.36 July 2, 2007 0.00 January 2, 2008 644,988.06 July 2, 2008 0.00 January 2, 2009 515,814.25 July 2, 2009 0.00 January 2, 2010 256,969.38 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N192DN --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $706,274.59 July 2, 2003 0.00 January 2, 2004 729,748.26 July 2, 2004 0.00 January 2, 2005 790,525.16 July 2, 2005 0.00 January 2, 2006 787,949.87 July 2, 2006 0.00 January 2, 2007 845,121.36 July 2, 2007 0.00 January 2, 2008 644,988.06 July 2, 2008 0.00 January 2, 2009 515,814.25 July 2, 2009 0.00 January 2, 2010 256,969.38 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N828MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $864,202.74 July 2, 2003 0.00 January 2, 2004 898,258.77 July 2, 2004 0.00 January 2, 2005 982,388.77 July 2, 2005 0.00 January 2, 2006 984,398.64 July 2, 2006 0.00 January 2, 2007 1,066,820.25 July 2, 2007 0.00 January 2, 2008 1,031,519.67 July 2, 2008 0.00 January 2, 2009 689,685.51 July 2, 2009 0.00 January 2, 2010 347,249.51 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N829MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $864,202.74 July 2, 2003 0.00 January 2, 2004 898,258.77 July 2, 2004 0.00 January 2, 2005 982,388.77 July 2, 2005 0.00 January 2, 2006 984,398.64 July 2, 2006 0.00 January 2, 2007 1,066,820.25 July 2, 2007 0.00 January 2, 2008 1,031,519.67 July 2, 2008 0.00 January 2, 2009 689,685.51 July 2, 2009 0.00 January 2, 2010 347,249.51 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N830MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $867,708.10 July 2, 2003 0.00 January 2, 2004 901,902.36 July 2, 2004 0.00 January 2, 2005 986,373.61 July 2, 2005 0.00 January 2, 2006 988,391.64 July 2, 2006 0.00 January 2, 2007 1,071,147.57 July 2, 2007 0.00 January 2, 2008 1,035,703.88 July 2, 2008 0.00 January 2, 2009 692,483.07 July 2, 2009 0.00 January 2, 2010 348,658.05 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N831MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $867,708.10 July 2, 2003 0.00 January 2, 2004 901,902.36 July 2, 2004 0.00 January 2, 2005 986,373.61 July 2, 2005 0.00 January 2, 2006 988,391.64 July 2, 2006 0.00 January 2, 2007 1,071,147.57 July 2, 2007 0.00 January 2, 2008 1,035,703.88 July 2, 2008 0.00 January 2, 2009 692,483.07 July 2, 2009 0.00 January 2, 2010 348,658.05 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N832MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $867,708.10 July 2, 2003 0.00 January 2, 2004 901,902.36 July 2, 2004 0.00 January 2, 2005 986,373.61 July 2, 2005 0.00 January 2, 2006 988,391.64 July 2, 2006 0.00 January 2, 2007 1,071,147.57 July 2, 2007 0.00 January 2, 2008 1,035,703.88 July 2, 2008 0.00 January 2, 2009 692,483.07 July 2, 2009 0.00 January 2, 2010 348,658.05 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 N833MH --------------------------------------- SCHEDULE 1-A to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTE PRINCIPAL PAYMENTS Scheduled Principal Payment Date Payments --------------- ------------------- January 2, 2003 $870,695.54 July 2, 2003 0.00 January 2, 2004 905,659.82 July 2, 2004 0.00 January 2, 2005 990,482.99 July 2, 2005 0.00 January 2, 2006 992,509.42 July 2, 2006 0.00 January 2, 2007 1,075,610.12 July 2, 2007 0.00 January 2, 2008 902,018.85 July 2, 2008 0.00 January 2, 2009 695,368.05 July 2, 2009 0.00 January 2, 2010 350,110.61 July 2, 2010 0.00 January 2, 2011 0.00 July 2, 2011 0.00 January 2, 2012 0.00 SCHEDULE I-B to TRUST SUPPLEMENT NO. 2002-1C AGGREGATE EQUIPMENT NOTE PRINCIPAL PAYMENTS Payment Date Scheduled Principal Payments --------------- ---------------------------- April 30, 2002 -- January 2, 2003 $13,173,789.23 July 2, 2003 0.00 January 2, 2004 14,685,952.96 July 2, 2004 0.00 January 2, 2005 15,161,078.16 July 2, 2005 0.00 January 2, 2006 15,151,092.48 July 2, 2006 0.00 January 2, 2007 16,137,612.13 July 2, 2007 0.00 January 2, 2008 14,070,719.15 July 2, 2008 0.00 January 2, 2009 11,466,464.07 July 2, 2009 16,414,344.43 January 2, 2010 32,097,902.65 July 2, 2010 0.00 January 2, 2011 18,774,618.71 July 2, 2011 0.00 January 2, 2012 1,550,426.03 SCHEDULE II to TRUST SUPPLEMENT NO. 2002-1C EQUIPMENT NOTES, PRINCIPAL AMOUNTS AND MATURITIES Equipment Notes Principal Amount Maturity --------------- ---------------- --------------- N372DA 4,602,000.00 January 2, 2012 N373DA 4,602,000.00 January 2, 2012 N374DA 4,608,000.01 January 2, 2012 N375DA 4,608,000.01 January 2, 2012 N396DA 4,824,000.01 January 2, 2012 N397DA 4,824,000.01 January 2, 2012 N398DA 4,824,000.01 January 2, 2012 N399DA 4,836,000.00 January 2, 2012 N3730B 4,836,000.00 January 2, 2012 N3764D 4,956,000.00 January 2, 2012 N3765 4,956,000.00 January 2, 2012 N3766 4,956,000.00 January 2, 2012 N3767 4,956,000.00 January 2, 2012 N3768 4,956,000.00 January 2, 2012 N3769L 4,956,000.00 January 2, 2012 N37700 4,967,999.99 January 2, 2012 N3771K 4,967,999.99 January 2, 2012 N67171 4,298,484.96 January 2, 2012 N185DN 4,857,984.11 January 2, 2012 N186DN 4,857,984.11 January 2, 2012 N187DN 5,067,687.53 January 2, 2012 N188DN 5,067,687.53 January 2, 2012 N189DN 5,277,390.94 January 2, 2012 N190DN 5,277,390.94 January 2, 2012 N191DN 5,277,390.94 January 2, 2012 N192DN 5,277,390.94 January 2, 2012 N828MH 6,864,523.85 January 2, 2012 N829MH 6,864,523.85 January 2, 2012 N830MH 6,892,368.29 January 2, 2012 N831MH 6,892,368.29 January 2, 2012 N832MH 6,892,368.29 January 2, 2012 N833MH 6,782,455.39 January 2, 2012 SCHEDULE III to TRUST SUPPLEMENT NO. 2002-1C AIRCRAFT Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH SCHEDULE IV to TRUST SUPPLEMENT NO. 2002-1C NOTE DOCUMENTS Participation Agreement Indenture and Security Agreement Series 2002-1G-1 Equipment Note Series 2002-1G-2 Equipment Note Series 2002-1C Equipment Note Series 2002-1D Equipment Note For each of the following aircraft: (except for the B737-832 aircraft, for which there is no Series 2002-1D Equipment Note): Aircraft Registration Aircraft Number --------------- ------------------- B737-832 N372DA B737-832 N373DA B737-832 N374DA B737-832 N375DA B737-832 N396DA B737-832 N397DA B737-832 N398DA B737-832 N399DA B737-832 N3730B B737-832 N3764D B737-832 N3765 B737-832 N3766 B737-832 N3767 B737-832 N3768 B737-832 N3769L B737-832 N37700 B737-832 N3771K B757-232 N67171 B767-332ER N185DN B767-332ER N186DN B767-332ER N187DN B767-332ER N188DN B767-332ER N189DN B767-332ER N190DN B767-332ER N191DN B767-332ER N192DN B767-432ER N828MH B767-432ER N829MH B767-432ER N830MH B767-432ER N831MH B767-432ER N832MH B767-432ER N833MH EX-4.(B)(1) 6 de763576-ex4b1.txt INTERCREDITOR AGMT Exhibit 4(b)(1) INTERCREDITOR AGREEMENT Dated as of April 30, 2002 among STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee of the Delta Air Lines Pass Through Trust 2002-1G-1, Delta Air Lines Pass Through Trust 2002-1G-2, Delta Air Lines Pass Through Trust 2002-1C, and Delta Air Lines Pass Through Trust 2002-1D WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider, and Class C Liquidity Provider, STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent and MBIA INSURANCE CORPORATION, as Policy Provider Table of Contents ARTICLE I DEFINITIONS Section 1.01. Definitions...................................................... ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY Section 2.01. Agreement to Terms of Subordination; Payments from Monies Received Only.................................................... Section 2.02. Trust Accounts................................................... Section 2.03. Deposits to the Collection Account and Special Payments Account; Certain Distributions................................... Section 2.04. Distributions of Special Payments................................ Section 2.05. Designated Representatives....................................... Section 2.06. Controlling Party................................................ ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED Section 3.01. Written Notice of Distribution................................... Section 3.02. Distribution of Amounts on Deposit in the Collection Account..... Section 3.03. Distribution of Amounts on Deposit Following a Triggering Event............................................................ Section 3.04. Other Payments................................................... Section 3.05. Payments to the Trustees and the Liquidity Providers............. Section 3.06. Liquidity Facilities............................................. Section 3.07. The Policies..................................................... ARTICLE IV EXERCISE OF REMEDIES Section 4.01. Directions from the Controlling Party............................ Section 4.02. Remedies Cumulative.............................................. Section 4.03. Discontinuance of Proceedings.................................... Section 4.04. Right of Certificateholders to Receive Payments Not to Be Impaired......................................................... ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC. Section 5.01. Notice of Indenture Event of Default or Triggering Event......... Section 5.02. Indemnification.................................................. Section 5.03. No Duties Except as Specified in Intercreditor Agreement......... Section 5.04. Notice from the Liquidity Providers and Trustees................. ARTICLE VI THE SUBORDINATION AGENT Section 6.01. Authorization; Acceptance of Trusts and Duties................... Section 6.02. Absence of Duties................................................ Section 6.03. No Representations or Warranties as to Documents................. Section 6.04. No Segregation of Monies; No Interest............................ Section 6.05. Reliance; Agents; Advice of Counsel.............................. Section 6.06. Capacity in Which Acting......................................... Section 6.07. Compensation..................................................... Section 6.08. May Become Certificateholder..................................... Section 6.09. Subordination Agent Required; Eligibility........................ Section 6.10. Money to Be Held in Trust........................................ ARTICLE VII SUCCESSOR SUBORDINATION AGENT Section 7.01. Replacement of Subordination Agent; Appointment of Successor..... ARTICLE VIII SUPPLEMENTS AND AMENDMENTS Section 8.01. Amendments, Waivers, Etc......................................... Section 8.02. Subordination Agent Protected.................................... Section 8.03. Effect of Supplemental Agreements................................ Section 8.04. Notice to Rating Agencies and the Policy Provider................ ARTICLE IX MISCELLANEOUS Section 9.01. Termination of Intercreditor Agreement........................... Section 9.02. Intercreditor Agreement for Benefit of Trustees, Liquidity Providers, Policy Provider and Subordination Agent............... Section 9.03. Notices.......................................................... Section 9.04. Severability..................................................... Section 9.05. No Oral Modifications or Continuing Waivers...................... Section 9.06. Successors and Assigns........................................... Section 9.07. Headings......................................................... Section 9.08. Counterparts..................................................... Section 9.09. Subordination.................................................... Section 9.10. Governing Law.................................................... Section 9.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity......................................................... INTERCREDITOR AGREEMENT This INTERCREDITOR AGREEMENT, dated as of April 30, 2002, is made by and among STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association (in its individual capacity, together with its successors and permitted assigns, "State Street"), not in its individual capacity but solely as trustee of each Trust (such term and other capitalized terms used herein without definition being defined as provided in Article I); WESTDEUTSCHE LANDESBANK GIROZENTRALE, a German banking institution organized under the laws of the State of North Rhine-Westphalia, acting through its New York Branch ("WestLB"), as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider and Class C Liquidity Provider, STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, 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 VII, the "Subordination Agent") and MBIA INSURANCE CORPORATION, a New York stock insurance company ("MBIA"), as the Policy Provider. WHEREAS, subject to clause (ii) of this recital, (i) pursuant to each Indenture with respect to an Aircraft owned by Delta at the time such Indenture is entered into (an "Owned Aircraft"), Delta will issue on a recourse basis four (or, in the case of a Boeing 737-832 Aircraft, three) series of Equipment Notes secured by such Aircraft and (ii) if an Aircraft becomes subject to a sale/leaseback transaction at any time after the date hereof (a "Leased Aircraft"), pursuant to an Indenture with respect to such Aircraft, as amended and restated in connection with such sale/leaseback transaction, the Owner Trustee will assume on a non-recourse basis Delta's obligations in respect of the Equipment Notes secured by such Aircraft, subject to re-optimization of such Equipment Notes (if such sale/leaseback transaction occurs prior to May 1, 2003); WHEREAS, pursuant to the Participation Agreements, each Trust will acquire those Equipment Notes having an interest rate identical to the interest rate applicable to the Certificates to be issued by such Trust; WHEREAS, pursuant to each Trust Agreement, the Trust created thereby proposes to issue a single class of Certificates (a "Class") bearing the interest rate and having 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 G-1, Class G-2 and Class C Certificates in the aggregate face amount set forth on Schedule I thereto on the terms and subject to the conditions set forth therein; WHEREAS, the Initial Class D Holder proposes to purchase the Class D Certificates in the aggregate face amount of $90,043,000 on the terms and subject to the conditions set forth in the Class D Trust Agreement and the Business Trust Agreement; WHEREAS, the Liquidity Provider proposes to enter into three separate revolving credit agreements with the Subordination Agent, as agent and trustee for the Trustee of each of the Class G-1 Trust, the Class G-2 Trust and the Class C Trust, respectively, for the benefit of the Certificateholders of such Trust; WHEREAS, the Policy Provider proposes to enter into the Policy Provider Agreement providing for the issuance by the Policy Provider of (i) the Class G-1 Policy for the benefit of the Class G-1 Certificateholders and (ii) the Class G-2 Policy for the benefit of the Class G-2 Certificateholders; and WHEREAS, it is a condition precedent to the obligations of the Underwriters under the Underwriting Agreement that the Subordination Agent, the Trustees, the Liquidity Provider and the Policy Provider agree to the terms of subordination set forth in this Agreement in respect of each Class of Certificates, and the Subordination Agent, the Trustees, the Liquidity Provider and the Policy Provider, 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 of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions. (a) The definitions stated herein apply equally to the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections" and other subdivisions are to the designated Articles, Sections and other subdivisions of this Agreement. (c) 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. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, it shall be deemed to be followed by the phrase "without limitation". (e) For purposes of this Agreement, unless the context otherwise requires, the following capitalized terms shall have the following meanings: "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. "Accrued Class G-1 Interest" means, with respect to any Distribution Date, all amounts due and owing in respect of accrued and unpaid interest on the Class G-1 Certificates at the Stated Interest Rate for the Class G-1 Certificates on such Distribution Date. "Accrued Class G-2 Interest" means, with respect to any Distribution Date, all amounts due and owing in respect of accrued and unpaid interest on the Class G-2 Certificates at the Stated Interest Rate for the Class G-2 Certificates on such Distribution Date. "Adjusted Expected Distributions" means, with respect to the Certificates of any Trust on any Current Distribution Date, the sum of (x) accrued and unpaid interest in respect of such Certificates and (y) the greater of: (A) the difference between (x) 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 (y) 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 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 (but 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, and (B) the amount of the excess, if any, of (i) the Pool Balance of such Class of 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), over (ii) the Aggregate LTV Collateral Amount for such Class of Certificates for the Current Distribution Date; provided that, until the date of the initial LTV Appraisals for all the Aircraft, clause (B) shall not apply. For purposes of calculating Adjusted Expected Distributions with respect to the Certificates of any Trust, any premium paid on the Equipment Notes held in such Trust that has not been distributed to the Certificateholders of such Trust (other than such premium or a portion thereof applied to the distribution 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 Adjusted Expected Distributions. "Advance" means, with respect to any Liquidity Facility, any Advance as defined in such Liquidity Facility. "Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under direct or indirect common control with such Person. For the purposes of this definition, "control", when used with respect to any specified Person, 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. "Aggregate LTV Collateral Amount" for any Class of Certificates for any Distribution Date means an amount, not less than zero, equal to the product of (i) the sum of the applicable LTV Collateral Amounts for such Class of Certificates for all Aircraft, minus the Pool Balance for each Class of Certificates, if any, senior to such Class, after giving effect to any distribution of principal on such Distribution Date with respect to such senior Class or Classes multiplied by (ii) (a) in the case of the Class G-1 Certificates or Class G-2 Certificates, a fraction the numerator of which equals the Pool Balance for the Class G-1 Certificates or the Class G-2 Certificates, as the case may be, and the denominator of which equals the aggregate Pool Balance for the Class G-1 Certificates and the Class G-2 Certificates, in each case prior to giving effect to any distribution of principal on such Distribution Date with respect to either such Class of Certificates, and (b) in the case of the Class C Certificates and the Class D Certificates, 1.0. "Aircraft" means, with respect to each Indenture, the "Aircraft" referred to therein. "Appraisal" means a current fair market value appraisal (which may be a "desktop" appraisal) performed by any Appraiser or any other nationally recognized appraiser on the basis of an arm's-length transaction between an informed and willing purchaser under no compulsion to buy and an informed and willing seller under no compulsion to sell and both having knowledge of all relevant facts. "Appraised Current Market Value" of any Aircraft means the lower of the average and the median of the three most recent LTV Appraisals of such Aircraft. "Appraisers" means Aircraft Information Systems, Inc., BK Associates, Inc. and AvSolutions, Inc. "Available Amount" means, with respect to any Liquidity Facility on any drawing date, subject to the proviso contained in the first sentence of Section 3.06(g), an amount equal to (a) the Stated Amount of such Liquidity Facility at such time, less (b) the aggregate amount of each Interest Drawing honored by the Liquidity Provider under such Liquidity Facility on or prior to such date that has not been reimbursed or reinstated as of such date; provided that, following a Downgrade Drawing, a Non-Extension Drawing or a Final Drawing under such Liquidity Facility, the Available Amount of such Liquidity Facility shall be zero. "Avoided Payment", with respect to a Policy, has the meaning specified in such Policy. "Bankruptcy Code" means the United States Bankruptcy Code, 11 United States Code ss.ss.101 et seq., as amended, or any successor statutes thereto. "Basic Agreement" means that certain Pass Through Trust Agreement, dated as of November 16, 2000, between Delta and State Street, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, but does not include any Trust Supplement. "Business Day" means, with respect to the Certificates of any Class, (a) any day other than a Saturday, a Sunday or a day on which, (i) commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia, or, so long as any Certificate of such Class is outstanding, the city and state in which the Trustee, the Subordination Agent or any related Loan Trustee maintains its Corporate Trust Office or receives and disburses funds, or (ii) solely with respect to draws under a Policy, the fiscal agent under such Policy, at its office specified in such Policy, the Policy Provider, at its office specified in such Policy, and insurance companies in New York, New York are required or authorized by law or executive order to close and (b) solely with respect to Drawings under any Liquidity Facility, which day is also a "Business Day" as defined in such Liquidity Facility. "Business Trust Agreement" means the Trust Agreement dated as of April __, 2002 between New Sky, Ltd. and Wilmington Trust Company, as Owner Trustee, governing the creation and administration of the Initial Class D Holder, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Cash Collateral Account" means the Class G-1 Cash Collateral Account, the Class G-2 Cash Collateral Account or the Class C Cash Collateral Account, as applicable. "Certificate" means a Class G-1 Certificate, a Class G-2 Certificate, a Class C Certificate or a Class D Certificate, as applicable. "Certificateholder" means, with respect to any Class of Certificates, the Person in whose name a Certificate is registered in the Register for the Certificates of such Class. "Citizen of the United States" has the meaning specified for such term in Section 40102(a)(15) of Title 49 of the United States Code or any similar legislation of the United States enacted in substitution or replacement therefor. "Class" has the meaning specified in the recitals to this Agreement. "Class C 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 so qualifies, into which amounts shall be deposited as referred to in Section 3.06(f). "Class C Certificateholder" means, at any time, any Certificateholder of one or more Class C Certificates. "Class C Certificates" means the certificates issued by the Class C Trust, substantially in the form of Exhibit A to the Class C Trust Agreement, and authenticated by the Class C Trustee, representing Fractional Undivided Interests in the Class C Trust, and any certificates issued in exchange therefor or replacement thereof pursuant to the terms of the Class C Trust Agreement. "Class C 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 C Trustee, and WestLB, and, from and after the replacement of such 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 C Liquidity Provider" means WestLB, together with any Replacement Liquidity Provider that has issued a Replacement Liquidity Facility to replace the Class C Liquidity Facility pursuant to Section 3.06(c) or 3.06(e). "Class C Trust" means the Delta Air Lines Pass Through Trust 2002-1C created and administered pursuant to the Class C Trust Agreement. "Class C Trust Agreement" means the Basic Agreement, as supplemented by Trust Supplement No. 2002-1C thereto, dated as of the date hereof, governing the creation and administration of the Delta Air Lines Pass Through Trust 2002-1C and the issuance of the Class C Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class C Trustee" means State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity except as expressly set forth in the Class C Trust Agreement, but solely as trustee under the Class C Trust Agreement, together with any successor trustee appointed pursuant thereto. "Class D Certificateholder" means, at any time, any Certificateholder of one or more Class D Certificates. "Class D Certificates" means the certificates issued by the Class D Trust, substantially in the form of Exhibit A to the Class D Trust Agreement, and authenticated by the Class D Trustee, representing Fractional Undivided Interests in the Class D Trust, and any certificates issued in exchange therefor or replacement thereof pursuant to the terms of the Class D Trust Agreement. "Class D Trust" means the Delta Air Lines Pass Through Trust 2002-1D created and administered pursuant to the Class D Trust Agreement. "Class D Trust Agreement" means the Basic Agreement, as supplemented by Trust Supplement No. 2002-1D thereto, dated as of the date hereof, governing the creation and administration of the Delta Air Lines Pass Through Trust 2002-1D and the issuance of the Class D Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class D Trustee" means State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity except as expressly set forth in the Class D Trust Agreement, but solely as trustee under the Class D Trust Agreement, together with any successor trustee appointed pursuant thereto. "Class G-1 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 so qualifies, into which amounts shall be deposited as referred to in Section 3.06(f). "Class G-1 Certificateholder" means, at any time, any Certificateholder of one or more Class G-1 Certificates. "Class G-1 Certificates" means the certificates issued by the Class G-1 Trust, substantially in the form of Exhibit A to the Class G-1 Trust Agreement, and authenticated by the Class G-1 Trustee, representing Fractional Undivided Interests in the Class G-1 Trust, and any certificates issued in exchange therefor or replacement thereof pursuant to the terms of the Class G-1 Trust Agreement. "Class G-1 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 G-1 Trustee, and WestLB and, from and after the replacement of such 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 G-1 Liquidity Provider" means WestLB, together with any Replacement Liquidity Provider that has issued a Replacement Liquidity Facility to replace the Class G-1 Liquidity Facility pursuant to Section 3.06(c) or 3.06(e). "Class G-1 Policy" means the MBIA Financial Guaranty Insurance Policy No. 37923(1) issued as of the Closing Date by the Policy Provider, together with all endorsements thereto, in favor of the Subordination Agent for the benefit of the Class G-1 Certificateholders, as amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class G-1 Policy Account" means the Eligible Deposit Account established pursuant to Section 2.02(a)(iii)(x) into which amounts shall be deposited as referred to in Section 3.07. "Class G-1 Trust" means the Delta Air Lines Pass Through Trust 2002-1G-1 created and administered pursuant to the Class G-1 Trust Agreement. "Class G-1 Trust Agreement" means the Basic Agreement, as supplemented by Trust Supplement No. 2002-1G-1 thereto, dated as of the date hereof, governing the creation and administration of the Delta Air Lines Pass Through Trust 2002-1G-1 and the issuance of the Class G-1 Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class G-1 Trustee" means State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity except as expressly set forth in the Class G-1 Trust Agreement, but solely as trustee under the Class G-1 Trust Agreement, together with any successor trustee appointed pursuant thereto. "Class G-2 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 so qualifies, into which amounts shall be deposited as referred to in Section 3.06(f). "Class G-2 Certificateholder" means, at any time, any Certificateholder of one or more Class G-2 Certificates. "Class G-2 Certificates" means the certificates issued by the Class G-2 Trust, substantially in the form of Exhibit A to the Class G-2 Trust Agreement, and authenticated by the Class G-2 Trustee, representing Fractional Undivided Interests in the Class G-2 Trust, and any certificates issued in exchange therefor or replacement thereof pursuant to the terms of the Class G-2 Trust Agreement. "Class G-2 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 G-2 Trustee, and WestLB and, from and after the replacement of such 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 G-2 Liquidity Provider" means WestLB, together with any Replacement Liquidity Provider that has issued a Replacement Liquidity Facility to replace the Class G-2 Liquidity Facility pursuant to Section 3.06(c) or 3.06(e). "Class G-2 Policy" means the MBIA Financial Guaranty Insurance Policy No. 37923(2) issued as of the Closing Date by the Policy Provider, together with all endorsements thereto, in favor of the Subordination Agent for the benefit of the Class G-2 Certificateholders, as amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class G-2 Policy Account" means the Eligible Deposit Account established pursuant to Section 2.02(a)(iii)(y) into which amounts shall be deposited as referred to in Section 3.07. "Class G-2 Trust" means the Delta Air Lines Pass Through Trust 2002-1G-2 created and administered pursuant to the Class G-2 Trust Agreement. "Class G-2 Trust Agreement" means the Basic Agreement, as supplemented by Trust Supplement No. 2002-1G-2 thereto, dated as of the date hereof, governing the creation and administration of the Delta Air Lines Pass Through Trust 2001-1G-2 and the issuance of the Class G-2 Certificates, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Class G-2 Trustee" means State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity except as expressly set forth in the Class G-2 Trust Agreement, but solely as trustee under the Class G-2 Trust Agreement, together with any successor trustee appointed pursuant thereto. "Closing Date" means April 30, 2002. "Code" means the Internal Revenue Code of 1986, as amended from time to time, and Treasury Regulations promulgated thereunder. "Collateral" means, with respect to any Indenture in respect of an Owned Aircraft, the "Collateral" referred to therein. "Collection Account" means the Eligible Deposit Account established by the Subordination Agent pursuant to Section 2.02(a) in and from which the Subordination Agent shall make deposits and withdrawals in accordance with this Agreement. "Consent Notice" has the meaning specified in Section 3.06(d). "Consent Period" has the meaning specified in Section 3.06(d). "Controlling Party" means the Person entitled to act as such pursuant to the terms of Section 2.06. "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 or the Adjusted Expected Distributions with respect to the Certificates of any Trust as of such Distribution Date. "Defaulted Series G Equipment Note" has the meaning specified in Section 3.07(c). "Delta" means Delta Air Lines, Inc., a Delaware corporation, and its successors and permitted assigns. "Delta Bankruptcy Event" means the occurrence and continuation of any of the following: (a) Delta consents 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, admits in writing its inability to pay its debts generally as they come due or makes a general assignment for the benefit of creditors; (b) Delta files a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief as a debtor in a case under any bankruptcy laws or insolvency laws (as in effect at such time) or an answer admitting the material allegations of a petition filed against Delta as a debtor in any such case, or Delta seeks relief as a debtor 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 Delta seeks an agreement, composition, extension or adjustment with its creditors under such laws; or (c) an order, judgment or decree is entered by any court of competent jurisdiction appointing, without the consent of Delta , a receiver, trustee or liquidator of Delta or sequestering any substantial part of its property, or granting any other relief in respect of Delta as a debtor under any bankruptcy laws or insolvency laws (as in effect at such time), and any such order, judgment or decree of appointment or sequestration remains in force undismissed, unstayed and unvacated for a period of 90 days after the date of entry thereof; or (d) a petition against Delta as a debtor in a case under the federal bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within 90 days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of corporations that applies to Delta , any court of competent jurisdiction assumes jurisdiction, custody or control of Delta 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 90 days. "Delta Provisions" has the meaning specified in Section 8.01(a). "Designated Representatives" means the Subordination Agent Representatives, the Trustee Representatives, the Policy Provider Representatives, and the Liquidity Provider Representatives identified under Section 2.05. "Disposition Payment" has the meaning specified in Section 3.07(b). "Distribution Date" means a Regular Distribution Date or a Special Distribution Date. "Dollars" means the lawful currency of the United States. "Downgrade Drawing" has the meaning specified in Section 3.06(c). "Downgraded Facility" has the meaning specified in Section 3.06(c). "Drawing" means an Interest Drawing, a Final Drawing, a Non-Extension Drawing or a Downgrade Drawing, as the case may be. "Election Distribution Date" has the meaning specified in Section 3.07(c). "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 or any one of the states thereof or the District of Columbia (or any United States 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 or its equivalent by Moody's or at least A- or its equivalent by S&P. An Eligible Deposit Account may be maintained with the Subordination Agent or Liquidity Provider so long as the Subordination Agent or such Liquidity Provider is an Eligible Institution; provided that the Subordination Agent, in its individual capacity, or 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 state thereof or the District of Columbia (or any U.S. branch of a foreign bank), which has a long-term unsecured debt rating of at least A3 or its equivalent by Moody's or at least A- or its equivalent by S&P. "Eligible Investments" means investments in (a) obligations of the United States government or agencies thereof, or obligations guaranteed by the United States government, (b) open market commercial paper of any corporation incorporated under the laws of the United States or any state thereof rated at least P-1 or its equivalent by Moody's or at least A-1 or its equivalent by S&P, (c) certificates of deposit issued by commercial banks organized under the laws of the United States or of any political subdivision thereof (or any United States branch of a foreign bank) having a combined capital and surplus in excess of $500,000,000 which banks or their holding companies have a rating of A or its equivalent by Moody's or A or its equivalent by S&P; provided, however, that the aggregate amount at any one time invested in certificates of deposit issued by any one bank shall not be in excess of 5% of such bank's capital and surplus, (d) Dollar denominated offshore certificates of deposit issued by, or offshore time deposits with, any commercial bank described in (c) or any subsidiary thereof, and (e) repurchase agreements with any financial institution having combined capital and surplus of at least $500,000,000 with any of the obligations described in clauses (a) through (d) as collateral. If none of the above investments is available, the entire amounts to be invested may be used to purchase Federal funds from an entity described in clause (c). All Eligible Investments must be held in an Eligible Deposit Account. Any of the investments described herein may be made through or with, as applicable, the bank acting as Trustee or its Affiliates. "Eligible Liquidity Provider" has the meaning specified in Section 2.06(c). "Equipment Notes" means, at any time, the Series G-1 Equipment Notes, the Series G-2 Equipment Notes, the Series C Equipment Notes and the Series D Equipment Notes, collectively, and in each case, any Equipment Notes issued in exchange therefor or replacement thereof pursuant to the terms of the Indentures. "Excess Reimbursement Obligations" means, (a) in the event of any Policy Provider Election with respect to a Series G-1 Equipment Note or a Series G-2 Equipment Note, the portion of the Policy Provider Obligations that represents interest on such Equipment Note in excess of 18 months of interest at the interest rate applicable to such Equipment Note and (b) any interest on the Liquidity Obligations in respect of the Liquidity Facilities paid by the Policy Provider to the Liquidity Providers from and after the end of the 18-month period referred to in Section 3.07(c). "Expected Distributions" means, with respect to the Certificates of any Trust on any Current Distribution Date, the sum of (x) accrued and unpaid interest in respect of such Certificates and (y) 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 Equipment Notes held in such Trust has been paid when due (whether at stated maturity or upon redemption, prepayment, purchase or Acceleration or otherwise) and such payments have been distributed to the holders of such Certificates and (ii) 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. 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 distributions 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 specified in such Liquidity Facility. "Fee Letter" means the Fee Letter among WestLB, the Subordination Agent and Delta with respect to the Liquidity Facilities and any fee letter entered into among the Subordination Agent, Delta and any Replacement Liquidity Provider. "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 in respect of such Certificates and (y) the Pool Balance of such Certificates as of the immediately preceding Distribution Date. 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 distributions 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 3.06(i). "Final Legal Distribution Date" means (i) with respect to the Class G-1 Certificates, July 2, 2024, (ii) with respect to the Class G-2 Certificates, January 2, 2014, (iii) with respect to the Class C Certificates, July 2, 2013 and (iv) with respect to the Class D Certificates, July 2, 2007. "Final Order" has the meaning specified in each Policy. "Fractional Undivided Interest" means the fractional undivided interest in a Trust that is represented by a Certificate relating to such Trust. "Indenture" means each of the Indenture and Security Agreements dated the date hereof entered into by the Loan Trustee and Delta (or the Owner Trustee, following a sale/leaseback transaction relating to the Aircraft referred to therein) pursuant to the related Participation Agreements providing for the issuance of the Equipment Notes on the date hereof (or the assumption thereof by the Owner Trustee), in each case as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Indenture Estate" means, with respect to any Indenture in respect of a Leased Aircraft, the "Indenture Estate" referred to therein. "Indenture Event of Default" means, with respect to any Indenture, any Event of Default (as such term is defined in such Indenture) thereunder. "Initial Class D Holder" means Delta 2002-1 Class D Certificate Trust, a Delaware business trust organized pursuant to the Business Trust Agreement, as the sole initial purchaser and holder of the Class D Certificates. "Interest Drawing" has the meaning specified in Section 3.06(a). "Interest Payment Date" means, with respect to any Liquidity Facility, each date on which interest is due and payable under Section 3.07(c), (d) or (e) of such Liquidity Facility on a Downgrade Drawing, Non-Extension Drawing or Final Drawing thereunder. "Investment Earnings" means investment earnings on funds on deposit in the Trust Accounts net of losses and the Subordination Agent's reasonable expenses in making such investments. "Lease" means with respect to any Indenture relating to a Leased Aircraft, the "Lease" referred to therein. "Leased Aircraft" has the meaning specified in the recitals of this Agreement. "Lending Office" has the meaning, with respect to any Liquidity Facility, ascribed to such term in such Liquidity Facility. "Lien" means any mortgage, pledge, lien, charge, claim, encumbrance, lease, sublease or security interest of any kind. "Liquidity Event of Default", with respect to any Liquidity Facility, has the meaning specified 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 G-1 Liquidity Facility, the Class G-2 Liquidity Facility or the Class C Liquidity Facility, as applicable. "Liquidity Obligations" means all principal, interest, fees and other amounts owing to the Liquidity Providers under the Liquidity Facilities, Section 4.02 of the Participation Agreements relating to the Owned Aircraft, Section 4.03 of the Participation Agreements relating to the Leased Aircraft or the Fee Letter. "Liquidity Provider" means, at any time, the Class G-1 Liquidity Provider, the Class G-2 Liquidity Provider or the Class C Liquidity Provider, as applicable. "Liquidity Provider Incumbency Certificate" has the meaning specified in Section 2.05(c). "Liquidity Provider Representatives" has the meaning specified in Section 2.05(c). "Loan Trustee" means, with respect to any Indenture, the bank, trust company or other financial institution designated as loan trustee thereunder, and any successor to such loan trustee. "LTV Appraisals" has the meaning specified in Section 4.01(a). "LTV Collateral Amount" of any Aircraft for any Class of Certificates means, as of any Distribution Date, the lesser of (i)(x) with respect to any Aircraft other than an Aircraft referred to in the following clauses (y) and (z), the LTV Ratio for such Class of Certificates multiplied by the Appraised Current Market Value of such Aircraft or (y) with respect to any such Aircraft that has suffered an Event of Loss under and as defined in the relevant Indenture, the amount of the insurance proceeds paid to the related Loan Trustee in respect thereof to the extent then held by such Loan Trustee (and/or on deposit in the Special Payments Account) or payable to such Loan Trustee in respect thereof or (z) with respect to any such Aircraft that has been released from the applicable Indenture pursuant to the provisions of Section 10.01(b) thereof, the amount of money and U.S. Government Obligations deposited with the Loan Trustee pursuant thereto as of such Distribution Date and (ii) the outstanding principal amount of the Equipment Notes secured by such Aircraft after giving effect to any principal payments of such Equipment Notes on or before such Distribution Date. "LTV Ratio" means (i) for the Class G-1 Certificates, 56.1%, (ii) for the Class G-2 Certificates, 56.1%, (iii) for the Class C Certificates, 61.1% and (iv) for the Class D Certificates, 69.7%. "Minimum Sale Price" means, with respect to any Aircraft or the Equipment Notes issued in respect of such Aircraft, at any time, the lesser of (a) 75% of the Appraised Current Market Value of such Aircraft and (b) the aggregate outstanding principal amount of such Equipment Notes, plus accrued and unpaid interest thereon. "Moody's" means Moody's Investors Service, Inc. "Non-Controlling Party" means, at any time, the Policy Provider, any Trustee or Liquidity Provider which is not the Controlling Party at such time. "Non-Extended Facility" has the meaning specified in Section 3.06(d). "Non-Extension Drawing" has the meaning specified in Section 3.06(d). "Non-Performing Equipment Note" means an Equipment Note issued pursuant to an Indenture that is not a Performing Equipment Note. "Notice of Avoided Payment", with respect to a Policy, has the meaning specified in such Policy. "Notice of Nonpayment", with respect to a Policy, has the meaning specified in such Policy. "Officer's Certificate" of any Person means a certification signed by a Responsible Officer of such Person. "Operative Agreements" means this Agreement, the Liquidity Facilities, the Business Trust Agreement, the Policies, the Policy Provider Agreement, the Policy Fee Letter, the Fee Letter, the Indentures, the Leases (if any), the Trust Agreements, the Participation Agreements, the Equipment Notes and the Certificates, together with all exhibits and schedules included with any of the foregoing. "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) all of the Certificates of such Class if money in the full amount required to make the final distribution with respect to such Class pursuant to Section 11.01 of such Trust Agreement has been theretofore deposited with the related Trustee in trust for the Certificateholders of such Certificates as provided in Section 4.01 of such Trust Agreement, pending distribution of such money to such Certificateholders pursuant to payment of such final distribution payment; and (iii) Certificates of such Class in exchange for or in lieu of which other Certificates of such Class have been authenticated and delivered pursuant to such Trust Agreement; provided, however, that in determining whether the holders of the requisite Fractional Undivided Interest of such Certificates have given any request, demand, authorization, direction, notice, consent or waiver hereunder, any Certificates owned by Delta or any of its Affiliates shall be disregarded and deemed not to be Outstanding. 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. Notwithstanding the foregoing, (x) if Delta and its Affiliates own 100% of the Certificates of each Class, such Certificates shall not be so disregarded and (y) if any amount of such Certificates owned by Delta and its Affiliates have been pledged in good faith, such Certificates shall not be disregarded 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 Delta 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. "Owned Aircraft" has the meaning specified in the recitals of this Agreement. "Owner Participant" means, with respect to any Indenture pertaining to a Leased Aircraft, the Owner Participant (as defined therein) and any permitted successor or assign of such Owner Participant. "Owner Trustee" means, with respect to any Indenture pertaining to a Leased Aircraft, the Owner Trustee (as defined therein) not in its individual capacity but solely as trustee under the related owner trust agreement, together with any successor trustee appointed pursuant to such owner trust agreement. "Participation Agreement" means, with respect to each Indenture, the "Participation Agreement" referred to therein, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Payees" has the meaning specified in Section 2.03(c). "Performing Equipment Note" means an Equipment Note issued pursuant to an Indenture 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 in which Delta is a debtor under Title 11 of the United States Code (the "Bankruptcy Code"), (i) any payment default occurring before the date of the order for relief for such proceeding shall not be taken into consideration during the 60-day period under Section 1110(a)(2)(A) of the Bankruptcy Code (or such longer period as may apply under Section 1110(b) of the Bankruptcy Code) (the "Section 1110 Period"), (ii) any payment default occurring after the date of the order for relief in such proceeding shall not be taken into consideration if such payment default is cured under Section 1110(a)(2)(B) of the Bankruptcy Code before the later of 30 days after the date of such default or the expiration of the Section 1110 Period and (iii) any payment default occurring after the Section 1110 Period will not be taken into consideration if such payment default is cured before the end of the grace period, if any, set forth in the related Indenture. "Performing Note Deficiency" means any time that less than 65% of the then aggregate outstanding principal amount of all Equipment Notes are Performing Equipment Notes. "Person" means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, trustee, unincorporated organization or government or any agency or political subdivision thereof. "Policy" means the Class G-1 Policy or the Class G-2 Policy. "Policy Account" means the Class G-1 Policy Account or the Class G-2 Policy Account, as applicable. "Policy Drawing" means, with respect to any Policy, any payment of a claim under such Policy. "Policy Expenses" means all amounts (including amounts in respect of expenses) owing to the Policy Provider under the Policy Provider Agreement or the Participation Agreements other than (i) any amounts due under the Policy Fee Letter, (ii) the amount of any Policy Drawing and any interest accrued thereon, (iii) reimbursement of and interest on the Liquidity Obligations paid to the Liquidity Provider by the Policy Provider, (iv) any indemnity payments owed to the Policy Provider, (v) any amounts that the Policy Provider is entitled to receive by virtue of the subrogation rights of the Policy Provider hereunder, including, without limitation, fees and expenses incurred in connection with the enforcement of such rights and (vi) any Excess Reimbursement Obligations. "Policy Fee Letter" means the fee letter, dated as of April 30, 2002 from the Policy Provider to Delta and the Subordination Agent setting forth the Premium and certain other amounts payable in respect of the Policies. "Policy Provider" means MBIA Insurance Corporation, or any successor thereto, as issuer of the Policies. "Policy Provider Agreement" means the Insurance and Indemnity Agreement, dated as of the date of issuance of the Certificates, among the Subordination Agent, the Class G-1 Trustee, the Class G-2 Trustee, Delta and the Policy Provider pursuant to which, among other things, the Subordination Agent agrees to reimburse the Policy Provider for amounts paid pursuant to claims made under the Policies. "Policy Provider Default" means the occurrence of any of the following events: (a) the Policy Provider fails to make a payment required under any Policy in accordance with its terms and such failure remains unremedied for two Business Days following the delivery of Written Notice of such failure to the Policy Provider or (b) the Policy Provider (i) files any petition or commences any case or proceeding under any provisions of any federal or state law relating to insolvency, bankruptcy, rehabilitation, liquidation or reorganization, (ii) makes a general assignment for the benefit of its creditors or (iii) has an order for relief entered against it under any federal or state law relating to insolvency, bankruptcy, rehabilitation, liquidation or reorganization that is final and nonappealable, or (c) a court of competent jurisdiction, the New York Insurance Department or another competent regulatory authority enters a final and nonappealable order, judgment or decree (i) appointing a custodian, trustee, agent or receiver for the Policy Provider or for all or any material portion of its property or (ii) authorizing the taking of possession by a custodian, trustee, agent or receiver of the Policy Provider (or taking of possession of all or any material portion of the Policy Provider's property). "Policy Provider Election" has the meaning specified in Section 3.07(c). "Policy Provider Incumbency Certificate" has the meaning specified in Section 2.05(d). "Policy Provider Obligations" means all reimbursement and other amounts, including fees and indemnities, due to the Policy Provider under the Policy Provider Agreement, but shall not include (i) any amounts due under the Policy Fee Letter and (ii) any interest on Policy Drawings except, if the Class G-1 Liquidity Provider or the Class G-2 Liquidity Provider has failed to honor its obligation to make a payment on any Interest Drawing in respect of the Class G-1 Certificates or the Class G-2 Certificates, as applicable, interest on the portion of any Policy Drawing made to cover the shortfall attributable to such failure by the Liquidity Provider in an amount equal to the amount of interest that would have accrued on such Interest Drawing if such Interest Drawing had been made at the interest rate applicable to such Interest Drawing until such Policy Drawing has been repaid in full, up to a maximum of three such Policy Drawings under the applicable Policy. For the avoidance of doubt, and subject to the effect of payment priorities with respect to Excess Reimbursement Obligations, Policy Provider Obligations include reimbursement of and interest on the Liquidity Obligations in respect of the Liquidity Facilities paid by the Policy Provider to the Liquidity Provider. "Policy Provider Representatives" has the meaning specified in Section 2.05(d). "Pool Balance" means, with respect to the Certificates of any Class, as of any date, (i) the original aggregate face amount of the Certificates of such Class less (ii) the aggregate amount of all distributions made in respect of such Certificates other than distributions made in respect of interest or premium or reimbursement of any costs or expenses incurred in connection therewith. The Pool Balance as of any Distribution Date with respect to each Class shall be computed after giving effect to the payment of principal, if any, on the Equipment Notes or other Trust Property held in the related Trust and the distribution thereof to be made on such date and, with respect to the Class G-1 Trust or the Class G-2 Trust, payments under the related Policy for the benefit of the Class G-1 Certificateholders or the Class G-2 Certificateholders, respectively (other than in respect of the Liquidity Facilities and interest on the Class G-1 Certificates or the Class G-2 Certificates, respectively). "Premium" has the meaning specified in the Policy Fee Letter. "Premium Percentage" has the meaning specified in the Policy Fee Letter. "Proceeding" means any suit in equity, action at law or other judicial or administrative proceeding. "Provider Representatives" has the meaning specified in Section 2.05(c) "PTC Event of Default" means, with respect to each Trust Agreement, the failure to distribute within 10 Business Days after the applicable Distribution Date: (i) the outstanding Pool Balance of the applicable Class of Certificates on the Final Legal Distribution Date for such Class (unless, in the case of the Class G-1 Certificates or the Class G-2 Certificates, the Subordination Agent shall have made a drawing under the Class G-1 Policy or the Class G-2 Policy, respectively, in an aggregate amount sufficient to pay such outstanding Pool Balance and shall have distributed such amount to the Class G-1 Trustee or the Class G-2 Trustee, respectively) or (ii) interest scheduled for distribution 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 for such Class or (in the case of the Class G-1 Certificates or the Class G-2 Certificates) a drawing under the Class G-1 Policy or the Class G-2 Policy, respectively, 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 of two nationally recognized rating agencies that have been requested to rate the Certificates and that are then rating the Certificates. The initial Rating Agencies will be Moody's and S&P. "Ratings Confirmation" means, with respect to any action proposed to be taken, a written confirmation from each of the Rating Agencies that such action (without regard to the related Policy in the case of the Class G-1 Certificates and Class G-2 Certificates) 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. "Register", with respect to any Trust, has the meaning ascribed to such term in the Trust Agreement for such Trust. "Regular Distribution Dates" means each January 2 and July 2, commencing on January 2, 2003; provided, however, that, if any such day shall not be a Business Day, the related distribution shall be made on the next succeeding Business Day without additional interest. "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, surety bond, financial insurance policy or guaranty) as shall permit the Rating Agencies to confirm in writing their respective ratings then in effect for the Certificates of the Class with respect to which such Liquidity Facility was issued (before downgrading of such ratings, if any, as a result of the downgrading, if any, of the applicable Liquidity Provider without regard to any Policy), and, in the case of the Class G-1 Liquidity Facility or the Class G-2 Liquidity Facility only, to be consented to by the Policy Provider, which consent shall not be unreasonably withheld or delayed, in a face amount (or in an aggregate face amount) equal to the applicable Required Amount and issued by a Person (or Persons) having short-term ratings issued by both Rating Agencies that are equal to or higher than the Threshold Rating specified in clause (a) of the definition of "Threshold Rating" or if such Person (or Persons) does not have a short-term rating from a given Rating Agency, a long-term rating issued by such Rating Agency that is equal to or higher than the "Threshold Rating" specified in clause (b) of the definition of 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 3.06(d) hereof. "Replacement Liquidity Provider" means a Person who issues a Replacement Liquidity Facility. "Required Amount" means, with respect to each Liquidity Facility, or the Cash Collateral Account, for any Class, 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 on the basis of a 360-day year comprised of twelve 30-day months, that would be distributable 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 date and without regard to expected future distributions of principal on such Class of Certificates. The Pool Balance for purposes of the definition of Required Amount with respect to the Class G-1 Liquidity Facility or the Class G-2 Liquidity Facility shall, in the event of any Policy Provider Election, be deemed to be reduced by an amount (if positive) by which (a) the outstanding principal balance of the Series G-1 Equipment Note or the Series G-2 Equipment Note, respectively, in respect of which such Policy Provider Election has been made shall exceed (b) the amount of any Policy Drawings previously paid by the Policy Provider in respect of principal on such Series G-1 Equipment Note or Series G-2 Equipment Note, respectively. "Responsible Officer" means (i) with respect to the Subordination Agent and each of the Trustees, any officer in the Corporate Trust Department or similar department of the Subordination Agent or such Trustee, as the case may be, or any other officer customarily performing functions similar to those performed by the persons who at the time shall be such officers or to whom any corporate trust matter is referred because of his knowledge of and familiarity with a particular subject, (ii) with respect to each Liquidity Provider, any authorized officer of such Liquidity Provider and (iii) with respect to the Policy Provider, any of its authorized officers. "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) or (ii) any distribution in respect of interest on such Equipment Note to the Certificateholders of Certificates of the corresponding Class of Certificates with funds drawn under the Liquidity Facility for such Class or withdrawn from the Cash Collateral Account for such Class (or, in the case of any Series G-1 Equipment Note or Series G-2 Equipment Note, under the Class G-1 Policy or the Class G-2 Policy, respectively), which payment in the case of clause (i) or clause (ii) represents an installment of principal on such Equipment Note at the stated maturity of such installment, or the payment of regularly scheduled interest accrued on the unpaid principal amount of such Equipment Note, or both; provided, however, that any payment of principal, premium, 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 2.04(b) Fraction" has the meaning specified in Section 2.04(b). "Series C Equipment Notes" means the Series C Equipment Notes issued pursuant to each Indenture by Delta (or the Owner Trustee, following a sale/leaseback transaction relating to the Aircraft referred to in such Indenture) 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. "Series D Equipment Notes" means the Series D Equipment Notes issued pursuant to each Indenture by Delta 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. "Series G-1 Equipment Notes" means the Series G-1 Equipment Notes issued pursuant to each Indenture by Delta (or the Owner Trustee, following a sale/leaseback transaction relating to the Aircraft referred to in such Indenture) 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. "Series G-2 Equipment Notes" means the Series G-2 Equipment Notes issued pursuant to each Indenture by Delta (or the Owner Trustee, following a sale/leaseback transaction relating to the Aircraft referred to in such Indenture) 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. "Special Distribution Date" means, (i) with respect to any Special Payment, the Business Day chosen by the Subordination Agent pursuant to Section 2.04(a) or 3.07(b) for the distribution of such Special Payment in accordance with this Agreement, (ii) an Election Distribution Date or (iii) each other date designated in Section 3.07(c) or 3.07(e) as a Special Distribution Date. "Special Payment" means any payment (other than a Scheduled Payment or a distribution referred to in Section 2.03(c)) in respect of, or any proceeds of, any Equipment Note or Collateral (as defined in each Indenture in respect of an Owned Aircraft) or Indenture Estate (as defined in each Indenture in respect of a Leased Aircraft). "Special Payments Account" means the Eligible Deposit Account created pursuant to Section 2.02(a) as a sub-account to the Collection Account. "S&P" means Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. "State Street" has the meaning specified in the introductory paragraph to this Agreement. "Stated Amount" with respect to any Liquidity Facility, means the Maximum Commitment (as defined in such Liquidity Facility) of the applicable Liquidity Provider thereunder. "Stated Expiration Date" has the meaning specified in Section 3.06(d). "Stated Interest Rate" means (i) with respect to the Class G-1 Certificates, 6.718% per annum, (ii) with respect to the Class G-2 Certificates, 6.417% per annum, (iii), with respect to the Class C Certificates, 7.779% per annum and (iv) with respect to the Class D Certificates, 8.270% per annum. "Subordination Agent" has the meaning specified in the introductory paragraph to this Agreement. "Subordination Agent Incumbency Certificate" has the meaning specified in Section 2.05(a). "Subordination Agent Representatives" has the meaning specified in Section 2.05(a). "Tax" and "Taxes" means all governmental fees (including, without limitation, license, filing and registration fees) and all taxes (including, without limitation, franchise, excise, stamp, value added, income, gross receipts, sales, use and property taxes), withholdings, assessments, levies, imposts, duties or charges, of any nature whatsoever, together with any related penalties, fines, additions to tax or interest thereon imposed, withheld, levied or assessed by any country, taxing authority or governmental subdivision thereof or therein or by any international authority, including any taxes imposed on any Person as a result of such Person being required to collect and pay over withholding taxes. "Termination Notice" with respect to any Liquidity Facility has the meaning specified in such Liquidity Facility. "Threshold Rating" means (a) with respect to the Class G-1 Liquidity Provider and the Class G-2 Liquidity Provider, a short-term unsecured debt rating of P-1 in the case of Moody's and a short-term corporate credit rating of A-1+ in the case of S&P, and with respect to the Class C Liquidity Provider, a short-term unsecured debt rating of P-1 in the case of Moody's and a short-term corporate credit rating of A-1 in the case of S&P, and (b) in the case of any Person who does not have such short-term rating from either or both of such Rating Agencies, then in lieu of such short-term rating from such Rating Agency or Rating Agencies, with respect to the Class G-1 Liquidity Provider and the Class G-2 Liquidity Provider, a long-term unsecured debt rating of A1 in the case of Moody's and a long-term corporate credit rating of AA- in the case of S&P and, with respect to the Class C Liquidity Provider, a long-term unsecured debt rating of A1 in the case of Moody's and a long-term corporate credit rating of A in the case of S&P. "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 Event of 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 or (z) the occurrence of a Delta Bankruptcy Event. "Trust" means any of the Class G-1 Trust, the Class G-2 Trust, the Class C Trust or the Class D Trust. "Trust Accounts" has the meaning specified in Section 2.02(a). "Trust Agreement" means any of the Class G-1 Trust Agreement, the Class G-2 Trust Agreement, the Class C Trust Agreement or the Class D Trust Agreement. "Trust Property", with respect to any Trust, has the meaning specified in the Trust Agreement for such Trust. "Trust Supplement" means an agreement supplemental to the Basic Agreement pursuant to which (i) a separate trust is created for the benefit of the holders of Certificates of a series, (ii) the issuance of the Certificates of a series representing fractional undivided interests in such trust is authorized and (iii) the terms of the Certificates of such series are established, as such agreement may from time to time be supplemented, amended or otherwise modified. "Trustee" means any of the Class G-1 Trustee, the Class G-2 Trustee, the Class C Trustee or the Class D Trustee. "Trustee Incumbency Certificate" has the meaning specified in Section 2.05(b). "Trustee Representatives" has the meaning specified in Section 2.05(b). "Underwriters" means the several underwriters listed as such in the Underwriting Agreement. "Underwriting Agreement" means the Underwriting Agreement, dated April 23, 2002, among the Underwriters and Delta, 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. "United States" means the United States of America. "WestLB" has the meaning specified in the introductory paragraph to this Agreement. "Withdrawal Notice" has the meaning specified in Section 3.06(d). "Written Notice" means, from the Subordination Agent, any Trustee, the Liquidity Provider or the Policy Provider, a written instrument executed by the Designated Representative of such Person. An invoice delivered by a Liquidity Provider pursuant to Section 3.01 in accordance with its normal invoicing procedures shall constitute Written Notice under such Section. ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY Section 2.01. Agreement to Terms of Subordination; Payments from Monies Received Only. (a) Each Trustee hereby acknowledges and agrees to the terms of subordination 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, the Liquidity Facilities and the Policies 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 2.01(b), 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 and other payments under the Operative Agreements, including payments under Section 4.02 of the Participation Agreements relating to the Owned Aircraft, Section 4.03 of the Participation Agreements relating to the Leased Aircraft, and Section 2.14 of the Indentures, 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 each Certificateholder, by its acceptance of a Certificate, each Liquidity Provider, by entering into the Liquidity Facility to which it is a party, and the Policy Provider, by entering into the Policy Provider Agreement, has agreed to look solely to such amounts to the extent available for distribution to it as provided in this Agreement or the applicable Trust Agreement, as the case may be, and that none of the Trustees, Owner Trustees, Loan Trustees, Owner Participants or 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, the Policy Provider Agreement 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 herein and in each Trust Agreement or (in the case of the Loan Trustees and the Owner Trustees) as expressly provided in any Operative Agreement. Notwithstanding anything to the contrary in this Agreement and in the other Operative Agreements, the Certificates do not represent indebtedness of the related Trust, and references in this Agreement and the Operative Agreements to accrued interest or principal amounts payable on the Certificates of any Class are included only for computational purposes. For purposes of such computations, the Certificates of any Class shall be deemed to be comprised of interest and principal components, with the principal component deemed to be the Pool Balance, and the interest component deemed to equal interest accruing at the Stated Interest Rate for such Class of Certificates from (i) the later of (1) the date of the issuance thereof and (2) the most recent but preceding Distribution Date to which such interest was distributed to (ii) the applicable date of determination, such interest to be considered payable in arrears and to be calculated on the basis of a 360-day year comprised of twelve 30-day months. Section 2.02. 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, the Liquidity Providers and the Policy Provider, (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, the Liquidity Providers and the Policy Provider and (iii) (x) a Class G-1 Policy 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 Class G-1 Certificateholders and (y) a Class G-2 Policy 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 Class G-2 Certificateholders. The Subordination Agent shall establish and maintain the Cash Collateral Accounts pursuant to and under the circumstances set forth in Section 3.06(f). Upon such establishment and maintenance under Section 3.06(f), the Collection Account, the Cash Collateral Accounts and the Policy Accounts shall constitute the "Trust Accounts" hereunder. (b) Funds on deposit in the Trust Accounts shall be invested and reinvested by the Subordination Agent in Eligible Investments selected by Delta or its designated representative 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 2.04, as the case may be, next following the date of such investment; provided, however, that, 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 applicable Cash Collateral Account in Eligible Investments pursuant to the written instructions of the Liquidity Provider funding such Drawing, and provided further, however, that upon the occurrence and during the continuation of a Triggering Event, the Subordination Agent shall invest and reinvest such amounts (other than amounts in the Cash Collateral Accounts as a result of a Downgrade Drawing or a Non-Extension Drawing, which shall be governed by the foregoing proviso) in Eligible Investments 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, Section 3.06(f)), 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. The Subordination Agent's reasonable fees and expenses actually incurred in making such investments and any losses incurred in such investments shall be charged against the principal amount invested. The Subordination Agent shall not be liable for any loss resulting from any investment, reinvestment or liquidation required to be made under this Agreement other than by reason of its willful misconduct or 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 herein 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, the Liquidity Providers and the Policy Provider, 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, to which the Policy Provider, the Liquidity Providers and each Rating Agency may consent) establish a new Collection Account, Special Payments Account, Policy 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, Policy Account, Cash Collateral Account, as the case may be. So long as the Subordination Agent is an Eligible Institution, the Trust Accounts shall be maintained with it as Eligible Deposit Accounts. Section 2.03. Deposits to the Collection Account and Special Payments Account; Certain Distributions. (a) The Subordination Agent shall, on each day when one or more Scheduled Payments are made to the Subordination Agent as holder of the Equipment Notes (other than any Scheduled Payment which by the express terms hereof is to be deposited to a Policy Account or a Cash Collateral Account), deposit in the Collection Account the aggregate amount of such Scheduled Payments. (b) The Subordination Agent shall, on each day 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. (c) In the event that a Loan Trustee distributes to the Subordination Agent pursuant to Section 3.04 or clause "first" of Section 3.03 of any Indenture any amounts payable under clauses (b), (c), (d) or (e) of Section 2.14 of any Indenture, the Subordination Agent shall promptly deposit such amounts in the Collection Account. The Subordination Agent will distribute promptly upon receipt thereof (or in the case of any such payment, compensation or reimbursement in respect of the Subordination Agent, will retain) (i) any indemnity payment received by it from Delta in respect of any Trustee, the Subordination Agent, any Liquidity Provider or the Policy Provider (collectively, the "Payees") and (ii) any compensation or reimbursement received by it from Delta or the Loan Trustee under any Operative Agreement in respect of any Payee (including, without limitation, any fees payable to any Liquidity Provider under Section 2.03 of any Liquidity Facility, any premium payable to the Policy Provider under the Policy Provider Agreement or other amounts referred to in clauses (a), (c), (d) or (e) of Section 2.14 of any Indenture), in any such case directly to the Payee entitled thereto, provided that if such Payee has previously received from the Collection Account such payment, compensation or reimbursement, then the Subordination Agent shall deposit such amount in the Collection Account. Section 2.04. Distributions of Special Payments. (a) Notice of Special Payment. 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, the Liquidity Providers and the Policy Provider. The Subordination Agent shall promptly calculate the amount of the prepayment (including upon Acceleration), redemption or purchase of Equipment Notes or the amount of any Overdue Scheduled Payment, as the case may be, comprising such Special Payment under the applicable Indenture or Indentures and shall promptly send to each Trustee and the Policy 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 first Business Day that follows the later to occur of (x) the 15th day after the date of such Written Notice or (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 2.04(b) and 2.04(c) hereof, as applicable. (b) Redemptions, Purchases and Prepayments of Equipment Notes. (i) So long as no Triggering Event shall have occurred (whether or not continuing), the Subordination Agent shall make distributions pursuant to this Section 2.04(b) of amounts on deposit in the Special Payments Account on account of the redemption, purchase (including, without limitation, a purchase resulting from a sale of the Equipment Notes permitted by Article IV) or prepayment (including upon Acceleration) of all of the Equipment Notes issued pursuant to an Indenture on the Special Distribution Date for such Special Payment in the following order of priority: first, such amount as shall be required to pay (A) all accrued and unpaid Liquidity Expenses and Policy Expenses then in arrears plus (B) the product of (x) the aggregate amount of all accrued and unpaid Liquidity Expenses and Policy Expenses not in arrears to such Special Distribution Date multiplied by (y) a fraction, the numerator of which is the aggregate outstanding principal amount of Equipment Notes being redeemed, purchased or prepaid on such Special Distribution Date and the denominator of which is the aggregate outstanding principal amount of all Equipment Notes (the "Section 2.04(b) Fraction"), shall be distributed to the Liquidity Providers and the Policy Provider pro rata on the basis of the amount of Liquidity Expenses and Policy Expenses owed to each Liquidity Provider and the Policy Provider, respectively; second, such amount as shall be required to pay (i) (A) all accrued and unpaid interest (including interest accrued and unpaid on any Interest Drawing or any Applied Provider Advance (as defined in any Liquidity Facility)) then in arrears on all Liquidity Obligations (determined after giving effect to payments made by the Policy Provider to each Liquidity Provider, if any, in respect of interest on drawings under the Liquidity Facilities) plus (B) the product of (x) the aggregate amount of all accrued and unpaid interest on all Liquidity Obligations not in arrears to such Special Distribution Date (at the rate provided in the applicable Liquidity Facility) (determined after giving effect to payments made by the Policy Provider to each Liquidity Provider, if any, in respect of interest on drawings under the Liquidity Facilities) multiplied by (y) the Section 2.04(b) Fraction, (ii) if the Class G-1 Liquidity Provider or Class G-2 Liquidity Provider has defaulted in its obligation to make any Interest Drawing, (A) the aggregate amount of interest accrued on the portion of any Policy Drawing made to cover the shortfall attributable to such default by the Liquidity Provider at the rate provided in the "except" clause of clause (ii) of the definition of "Policy Provider Obligations" which is then in arrears plus (B) the product of (x) the aggregate amount of all accrued and unpaid interest on such Policy Drawings not in arrears to such Special Distribution Date multiplied by (y) the Section 2.04(b) Fraction, and (iii) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to Section 2.06(c) hereof, the amount of such payment made to the Liquidity Providers attributable to such interest accrued on such drawings, shall be distributed to the Liquidity Providers and the Policy Provider pro rata on the basis of the amount of such Liquidity Obligations owed to each Liquidity Provider and the amount of such unreimbursed Policy Provider Obligations payable to the Policy Provider under this clause "second"; third, such amount as shall be required (A) if any Cash Collateral Account has been previously funded as provided in Section 3.06(f), 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 have 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, 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, (C) if, with respect to any particular Liquidity Facility, neither subclause (A) nor subclause (B) of this clause "third" is applicable, to pay or reimburse the Liquidity Provider in respect of such Liquidity Facility in an amount equal to the amount of any unreimbursed Interest Drawings under such Liquidity Facility shall be distributed to such Liquidity Provider (other than amounts payable pursuant to clause "first" or "second" of this Section 2.04(b) and as determined after giving effect to payments made by the Policy Provider to the Liquidity Provider in respect of principal of drawings under the Liquidity Facilities), pro rata with any amount distributable pursuant to subclause (D) of this clause "third" on the basis of the amount of all such unreimbursed Interest Drawings and unreimbursed Policy Provider Obligations payable to the Policy Provider under subclause (D) of this clause "third" and (D) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to Section 2.06(c) hereof, to reimburse the Policy Provider for the principal amount of such payment made to the Liquidity Providers, shall be distributed to the Policy Provider, but only after giving effect to the application of amounts, if any, under subclause (A) or (B) of this clause "third", and if any amount shall be distributable under subclause (C) of this clause "third", pro rata with any amount distributable pursuant to such subclause (C) on the basis of the amounts of all such unreimbursed Interest Drawings and the amount of such unreimbursed Policy Provider Obligations payable to the Policy Provider under this clause "third"; fourth, if, with respect to any particular Liquidity Facility, any amounts are to be distributed pursuant to either subclause (A) or (B) of clause "third" 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; fifth, if any Class G-1 Certificates or Class G-2 Certificates are Outstanding on such Special Distribution Date, such amount as shall be required to pay in full Expected Distributions to the holders of Class G-1 Certificates on such Special Distribution Date shall be distributed to the Class G-1 Trustee and such amount as shall be required to pay in full Expected Distributions to the holders of Class G-2 Certificates on such Special Distribution Date shall be distributed to the Class G-2 Trustee, pro rata on the basis of such amounts in respect of each such Class of Certificates; sixth, such amount as shall be required to pay Policy Provider Obligations then due (other than amounts payable pursuant to the preceding clauses of this Section 2.04(b)(i) and other than any Excess Reimbursement Obligations) to the Policy Provider; seventh, if any Class C Certificates are Outstanding on such Special Distribution Date, such amount as shall be required to pay in full Expected Distributions to the holders of Class C Certificates on such Special Distribution Date shall be distributed to the Class C Trustee; eighth, such amount as shall be required to pay (x) Excess Reimbursement Obligations to the Policy Provider and (y) the product of any amounts due under the Policy Fee Letter multiplied by the fraction specified in clause (i)(B)(y) of clause "third" of this Section 2.04(b)(i); ninth, if any Class D Certificates are Outstanding on such Special Distribution Date, such amount as shall be required to pay in full Expected Distributions to holders of Class D Certificates on such Special Distribution Date shall be distributed to the Class D Trustee; and tenth, the balance, if any, of such Special Payment shall be deposited in the Collection Account. For the purposes of this Section 2.04(b), clause (x) of the definition of "Expected Distributions" shall be deemed to read as follows: "(x) accrued, due and unpaid interest in respect of such Certificates together with (without duplication) accrued and unpaid interest in respect of a portion of such Certificates equal to the outstanding principal amount of Equipment Notes being redeemed, purchased or prepaid (immediately prior to such redemption, purchase or prepayment)". (ii) Upon the occurrence of a Triggering Event (whether or not continuing), the Subordination Agent shall make distributions pursuant to this Section 2.04(b) of amounts on deposit in the Special Payments Account on account of the redemption, purchase or prepayment of the Equipment Notes issued pursuant to an Indenture on the Special Distribution Date for such Special Payment in accordance with Section 3.03. (c) Other Special Payments. Any amounts on deposit in the Special Payments Account other than in respect of amounts to be distributed pursuant to Section 2.04(b) shall be distributed on the Special Distribution Date therefor in accordance with Article III. (d) Investment of Amounts in Special Payments Account. Any amounts on deposit in the Special Payments Account prior to the distribution thereof pursuant to Section 2.04(b) or 2.04(c) shall be invested in accordance with Section 2.02(b). Investment Earnings on such investments shall be distributed in accordance with Section 2.04(b) or 2.04(c), as the case may be. Section 2.05. Designated Representatives. (a) With the delivery of this Agreement, the Subordination Agent shall furnish to each Liquidity Provider, the Policy Provider and each Trustee, and from time to time thereafter may furnish to each Liquidity Provider, the Policy Provider and each Trustee, at the Subordination Agent's discretion, or upon any Liquidity Provider's, the Policy Provider's or 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, the Policy 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 (with respect to each such Trustee, 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 (with respect to each 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 from a Trustee, it shall be entitled to rely on the last Trustee Incumbency Certificate with respect to such Trustee 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 (with respect to each such Liquidity Provider, a "Liquidity Provider Incumbency Certificate") of a Responsible Officer of such Liquidity Provider certifying as to the incumbency and specimen signatures of the officers of such Liquidity Provider and the attorney-in-fact and agents of such Liquidity Provider (with respect to each such Liquidity Provider, the "Liquidity Provider Representatives") authorized to give Written Notices on behalf of such Liquidity Provider hereunder. Until the Subordination Agent receives a subsequent Liquidity Provider Incumbency Certificate, it shall be entitled to rely on the last Liquidity Provider Incumbency Certificate delivered to it hereunder. (d) With the delivery of this Agreement, the Policy Provider shall furnish to the Subordination Agent, and from time to time thereafter may furnish to the Subordination Agent, at the Policy 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 (a "Policy Provider Incumbency Certificate") of a Responsible Officer of the Policy Provider certifying as to the incumbency and specimen signatures of the officers of the Policy Provider and the attorney-in-fact and agents of the Policy Provider (the "Policy Provider Representatives" and, together with the Subordination Agent Representatives, the Trustee Representatives, and the Liquidity Provider Representatives, the "Designated Representatives") authorized to give Written Notices on behalf of the Policy Provider hereunder. Until the Subordination Agent receives a subsequent Policy Provider Incumbency Certificate, it shall be entitled to rely on the last Policy Provider Incumbency Certificate delivered to it hereunder. Section 2.06. Controlling Party. (a) The Trustees, the Liquidity Providers and the Policy Provider hereby agree that, with respect to any Indenture at any given time, the Loan Trustee thereunder will be directed (i) in taking, or refraining from taking, any action under such Indenture or with respect to the Equipment Notes issued thereunder, so long as no Indenture Event of Default has occurred and is continuing thereunder, by the holders of at least a majority of the outstanding principal amount of such Equipment Notes (provided that, for so long as the Subordination Agent is the registered holder of such Equipment Notes, subject to the provisions of Section 8.01(b), the Subordination Agent shall act with respect to this clause (i) in accordance with the directions of the Trustees of Trusts for which the related Trust Properties include, in the aggregate, such a majority of outstanding principal amount of such Equipment Notes), and (ii) after the occurrence and during the continuance of an Indenture Event of Default thereunder (which, in the case of an Indenture pertaining to a Leased Aircraft, has not been cured by the applicable Owner Trustee or Owner Participant, if applicable, pursuant to Section 4.03 of such Indenture), 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 created thereunder on the Aircraft securing such Equipment Notes), by the Subordination Agent as directed by the Controlling Party. (b) Subject to subparagraph (c) below, the Person who shall be the "Controlling Party" with respect to any Indenture shall be: (x) (i) the Policy Provider until payment of Final Distributions to the holders of Class G-1 Certificates and Class G-2 Certificates and no obligations owing to the Policy Provider hereunder remain outstanding or, (ii) if a Policy Provider Default has occurred and is continuing, (A) the Class G-1 Trustee or the Class G-2 Trustee, whichever represents the Class with the larger Pool Balance of Certificates Outstanding at the time such Indenture Event of Default occurs (whether or not any other Indenture Event of Default shall thereafter occur so long as such initial Indenture Event of Default shall continue); and (B) upon payment of Final Distributions to the holders of Certificates of such larger Class, the other of the Class G-1 Trustee or the Class G-2 Trustee; (y) upon payment of Final Distributions to the holders of Class G-1 Certificates and Class G-2 Certificates and, unless a Policy Provider Default has occurred and is continuing, no obligations owing to the Policy Provider hereunder remain outstanding, the Class C Trustee; and (z) upon payment of Final Distributions to the holders of Class G-1 Certificates, Class G-2 Certificates and Class C Certificates and, unless a Policy Provider Default has occurred and is continuing, no obligations owing to the Policy Provider hereunder remain outstanding, the Class D Trustee. For purposes of giving effect to the foregoing, 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 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, at any time after 18 months from the earliest to occur of (i) the date on which the entire Available Amount under any Liquidity Facility shall have been drawn (for any reason other than a Downgrade Drawing or a Non-Extension Drawing) and remain unreimbursed, (ii) the date on which the entire amount of any Downgrade Drawing or Non-Extension Drawing under any Liquidity Facility shall have become and remain "Applied Downgrade Advances" or "Applied Non-Extension Advances", as the case may be, under and as defined in such Liquidity Facility and (iii) the date on which all Equipment Notes shall have been Accelerated, the Liquidity Provider with the greatest amount of unreimbursed Liquidity Obligations (the "Eligible Liquidity Provider") shall have the right to elect, by Written Notice to the Subordination Agent, the Policy Provider and each of the Trustees, to become the Controlling Party hereunder with respect to any Indenture at any time from and including the last day of such 18-month period, provided that if, within 15 Business Days after its receipt of any such Written Notice from such Eligible Liquidity Provider (which notice may be given on or after the fifteenth Business Day prior to the end of such 18-month period) the Policy Provider pays to each Liquidity Provider all outstanding drawings owing to such Liquidity Provider in respect of its Liquidity Facility, and interest accrued thereon to such date, the Policy Provider shall remain the Controlling Party so long as no Policy Provider Default has occurred and is continuing; and if a Policy Provider Default has occurred and is continuing, the Eligible Liquidity Provider, if it so elects and if Liquidity Obligations owing to it remain outstanding, shall become the Controlling Party. At any time after such 18-month period, if a Policy Provider Default has occurred and is continuing and the Eligible Liquidity Provider does not elect to be the Controlling Party or if no Liquidity Obligations remain outstanding, then the Class G-1 Trustee or Class G-2 Trustee, as specified in subparagraph (b) above, shall become the Controlling Party. (d) The exercise of remedies by the Controlling Party under this Agreement shall be expressly limited by Section 4.01(a)(ii). (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. (f) Notwithstanding anything contained herein, neither the Controlling Party nor the Subordination Agent shall be authorized or empowered to do anything that would cause any Trust to fail to qualify as a "grantor trust" for federal income tax purposes. ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED Section 3.01. Written Notice of Distribution. (a) No later than 3:00 P.M. (New York City time) on the Business Day immediately preceding each Regular Distribution Date (or Special Distribution Date for purposes of Section 2.04(b), as the case may be), 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 G-1 Certificates and the Class G-2 Certificates, if any are then Outstanding, the Class G-1 Trustee and the Class G-2 Trustee, respectively, shall separately set forth the amounts to be paid in accordance with clause "fifth" of Section 3.02 or 2.04(b), as the case may be (without giving effect to the pro rata sharing therein); (ii) With respect to the Class C Certificates, if any are then Outstanding, the Class C Trustee shall separately set forth the amounts to be paid in accordance with clause "seventh" of Section 3.02 or 2.04(b), as the case may be; (iii) With respect to the Class D Certificates, if any are then Outstanding, the Class D Trustee shall separately set forth the amounts to be paid in accordance with clause "ninth" of Section 3.02 or 2.04(b), as the case may be; (iv) With respect to each Liquidity Facility, the Liquidity Provider thereunder shall separately set forth the amounts to be paid in accordance with clauses "first", "second", "third" and "fourth" of Section 3.02 or 2.04(b), as the case may be; and (v) The Policy Provider shall set forth the amounts to be paid to it in accordance with clauses "first", "second", "third", "sixth" and "eighth" of Section 2.04(b) or Section 3.02, as the case may be; and (vi) Each Trustee shall set forth the amounts to be paid in accordance with clause "tenth" of Section 3.02. The notices required under this Section 3.01(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 redemption, purchase or prepayment of the Equipment Notes, 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. (b) Following the occurrence of a Triggering Event, the Subordination Agent shall request the following information from the following Persons, and may from time to time thereafter again request such information from such Persons, and each of the following Persons shall, within five Business Days of such request of the Subordination Agent, deliver a Written Notice to the Subordination Agent setting forth for such Person the following information: (i) With respect to the Class G-1 Certificates and the Class G-2 Certificates, if any are then Outstanding, the Class G-1 Trustee and the Class G-2 Trustee, respectively, shall separately set forth the amounts to be paid in accordance with clauses "first" (to reimburse payments made by the Class G-1 Certificateholders and the Class G-2 Certificateholders, respectively, pursuant to subclause (iv) of clause "first" of Section 3.03), "sixth" (to reimburse payments made by the Class G-1 Certificateholders and the Class G-2 Certificateholders pursuant to subclause (iii) of clause "sixth" of Section 3.03) and "seventh" of Section 3.03 (without giving effect to the pro rata sharing therein); (ii) With respect to the Class C Certificates, if any are then Outstanding, the Class C Trustee shall separately set forth the amounts to be paid in accordance with clauses "first" (to reimburse payments made by the Class C Certificateholders pursuant to subclause (iv) of clause "first" of Section 3.03), "sixth" (to reimburse payments made by the Class C Certificateholders pursuant to subclause (iii) of clause "sixth" of Section 3.03) and "ninth" of Section 3.03; (iii) With respect to the Class D Certificates, if any are then Outstanding, the Class D Trustee shall separately set forth the amounts to be paid in accordance with clauses "first" (to reimburse payments made by the Class D Certificateholders pursuant to subclause (iv) of clause "first" of Section 3.03), "sixth" (to reimburse payments made by the Class D Certificateholders pursuant to subclause (iii) of clause "sixth" of Section 3.03) and "eleventh" of Section 3.03; (iv) With respect to each Liquidity Facility, the Liquidity Provider thereunder shall separately set forth the amounts to be paid to it in accordance with subclause (iv) of clause "first" of Section 3.03 and clauses "second", "third", "fourth" and "fifth" of Section 3.03; (v) The Policy Provider shall separately set forth amounts to be paid to it in accordance with clauses "first", "second", "third", "fourth", "eighth" and "tenth" of Section 3.03 hereof; and (vi) Each Trustee shall set forth the amounts to be paid in accordance with subclause (ii) of clause "first" of Section 3.03 and subclause (ii) of clause "sixth" of Section 3.03. (c) At such time as a Trustee, a Liquidity Provider or the Policy 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 2.04, 3.02, 3.03 or 3.07, as applicable, and, in the case of a Liquidity Provider or the Policy Provider, its commitment under the related Liquidity Facility or the Policies shall have terminated or expired, such Person shall, by a Written Notice, so inform the Subordination Agent and each other party to this Agreement. (d) As provided in Section 6.05, the Subordination Agent shall be fully protected in relying on any of the information set forth in a Written Notice provided by any Trustee, any Liquidity Provider or the Policy Provider pursuant to Sections 3.01(a), 3.01(b) and 3.01(c) 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. (e) Any Written Notice delivered by a Trustee, a Liquidity Provider or the Policy Provider, as applicable, pursuant to Section 3.01(a), 3.01(b) or 3.01(c), if made prior to 10:00 A.M. (New York City time) on a given date that is a Business Day shall be effective on the date delivered (or if delivered later on such date or on a day that 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. (f) In the event the Subordination Agent shall not receive from any Person any information set forth in Section 3.01(a) or 3.01(b) that is required to enable the Subordination Agent to make a distribution to such Person pursuant to Section 2.04(b), 3.02 or 3.03, 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 "tenth" of Section 2.04(b), clauses "first" through "eleventh" of Section 3.02 and clauses "first" through "twelfth" of Section 3.03 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, on the terms hereof (including Section 2.02(b)) until the Subordination Agent shall receive all necessary information to enable it to distribute any funds so withheld, and upon receipt of the information necessary to distribute any funds so withheld, the Subordination Agent shall distribute such funds. (g) On such dates (but not more frequently than monthly) as any Liquidity Provider, the Policy 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 3.01(f). Section 3.02. Distribution of Amounts on Deposit in the Collection Account. Except as otherwise provided in Sections 2.04, 3.01(f), 3.03, 3.04 and 3.06(b), amounts on deposit in the Collection Account (or, in the case of any amount described in Section 2.04(c), 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 2.04(c), 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 3.01(a): first, such amount as shall be required to pay in full (i) all accrued and unpaid Liquidity Expenses owed to each Liquidity Provider and (ii) all accrued and unpaid Policy Expenses owed to the Policy Provider, shall be distributed to each Liquidity Provider and the Policy Provider pro rata on the basis of the amount of Liquidity Expenses owed to each Liquidity Provider and Policy Expenses owed to the Policy Provider; second, such amount as shall be required to pay (i) accrued and unpaid interest on the Liquidity Obligations as provided in the applicable Liquidity Facility (determined after giving effect to payments made by the Policy Provider to each Liquidity Provider, if any, in respect of interest on drawings under the Liquidity Facilities), (ii) if the Class G-1 Liquidity Provider or Class G-2 Liquidity Provider has defaulted in its obligation to make any Interest Drawing in respect of the Class G-1 Certificates or Class G-2 Certificates, respectively, the aggregate amount of interest accrued on the portion of any Policy Drawing made to cover the shortfall attributable to such default by the Liquidity Provider at the rate provided in the "except" clause of clause (ii) of the definition of "Policy Provider Obligations" and (iii) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to subsection 2.06(c) hereof, the amount of such payment made to the Liquidity Providers attributable to such interest accrued on such drawings, shall be distributed to the Liquidity Providers and the Policy Provider pro rata on the basis of the amount of such Liquidity Obligations owed to each Liquidity Provider and the amount of such Policy Provider Obligations payable to the Policy Provider under this clause "second"; third, such amount as shall be required (A) if any Cash Collateral Account has been previously funded as provided in Section 3.06(f), 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 have 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, 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, (C) if, with respect to any particular Liquidity Facility, neither subclause (A) nor subclause (B) of this clause "third" 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 shall be distributed to such Liquidity Provider (other than amounts payable pursuant to clause "first" or "second" of this Section 3.02 and as determined after giving effect to payments made by the Policy Provider to the Liquidity Providers in respect of principal of drawings under the Liquidity Facilities), pro rata with any amount distributable pursuant to subclause (D) of this clause "third" on the basis of the amount of all such unreimbursed Liquidity Obligations and unreimbursed Policy Provider Obligations payable to the Policy Provider under subclause (D) of this clause "third" and (D) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to Section 2.06(c) hereof, to reimburse the Policy Provider for the principal amount of such payment made to the Liquidity Providers, shall be distributed to the Policy Provider, but only after giving effect to the application of amounts, if any, under subclause (A) or (B) of this clause "third", and if any amount shall be distributable under subclause (C) of this clause "third", pro rata with any amount distributable pursuant to such subclause (C), on the basis of the amounts of all such unreimbursed Liquidity Obligations and the amount of such unreimbursed Policy Provider Obligations payable to the Policy Provider under this clause "third"; fourth, if, with respect to any particular Liquidity Facility and the related Cash Collateral Account, any amounts are to be deposited pursuant to either subclause (A) or (B) of clause "third" 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; fifth, if any Class G-1 Certificates or Class G-2 Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Expected Distributions to the holders of the Class G-1 Certificates on such Distribution Date shall be distributed to the Class G-1 Trustee and such amount as shall be required to pay in full Expected Distributions to the holders of the Class G-2 Certificates on such Distribution Date shall be distributed to the Class G-2 Trustee, pro rata on the basis of such amounts in respect of each such Class of Certificates; sixth, such amount as shall be required to pay the Policy Provider all Policy Provider Obligations then due (other than amounts payable pursuant to the preceding clauses of this Section 3.02 and other than Excess Reimbursement Obligations) shall be distributed to the Policy Provider; seventh, if any Class C Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Expected Distributions to the holders of the Class C Certificates on such Distribution Date shall be distributed to the Class C Trustee; eighth, such amount as shall be required to pay in full any Excess Reimbursement Obligations and any amounts due under the Policy Fee Letter shall be distributed to the Policy Provider; ninth, if any Class D Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Expected Distributions to holders of Class D Certificates on such Distribution Date shall be distributed to the Class D Trustee; tenth, such amount as shall be required to pay in full (without duplication of any amounts otherwise payable hereunder or under any Operative Agreement) the aggregate unpaid amount of fees and expenses payable as of such Distribution Date to the Subordination Agent and each Trustee pursuant to the terms of this Agreement and the Trust Agreements, as the case may be, shall be distributed to the Subordination Agent and such Trustee; and eleventh, 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. Section 3.03. Distribution of Amounts on Deposit Following a Triggering Event. Except as otherwise provided in Sections 3.01(f) and 3.06(b), upon the occurrence of a Triggering Event and at all times thereafter, all funds in the Collection Account or the Special Payments Account shall be promptly distributed by the Subordination Agent in the following order of priority: first, such amount as shall be required to reimburse (i) the Subordination Agent for any out-of-pocket costs and expenses actually incurred by it (to the extent not previously reimbursed) in the protection of, or the realization of the value of, the Equipment Notes or any Collateral or Indenture Estate, shall be applied by the Subordination Agent in reimbursement of such costs and expenses, (ii) each 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) the Policy 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 the Policy Provider, and (iv) any Liquidity Provider, the Policy Provider or Certificateholder for payments, if any, made by it to the Subordination Agent or any Trustee in respect of amounts described in clause (i) above, shall be distributed to such Liquidity Provider, the Policy 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 (i) all accrued and unpaid Liquidity Expenses and (ii) all accrued and unpaid Policy Expenses shall be distributed to the Liquidity Providers and the Policy Provider pro rata on the basis of the amount of Liquidity Expenses and Policy Expenses owed to each Liquidity Provider and the Policy Provider; third, such amount as shall be required to pay (i) accrued and unpaid interest on the Liquidity Obligations as provided in the applicable Liquidity Facilities (determined after giving effect to payments made by the Policy Provider to each Liquidity Provider, if any, in respect of interest on drawings under the Liquidity Facilities), (ii) if the Class G-1 Liquidity Provider or Class G-2 Liquidity Provider has defaulted in its obligation to make any Interest Drawing in respect of the Class G-1 Certificates or Class G-2 Certificates, respectively, the aggregate amount of interest accrued on the portion of any Policy Drawing made to cover the shortfall attributable to such default by the Liquidity Provider at the rate provided in the "except" clause of clause (ii) of the definition of "Policy Provider Obligations" and (iii) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to Section 2.06(c) hereof, the amount of such payment made to the Liquidity Providers attributable to such interest accrued on such drawings, shall be distributed to the Liquidity Providers and the Policy Provider pro rata on the basis of the amount of such Liquidity Obligations owed to each Liquidity Provider and the amount of such Policy Provider Obligations payable to the Policy Provider under this clause "third"; fourth, such amount as shall be required (A) if any Cash Collateral Account has been previously funded as provided in Section 3.06(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 (less the amount of any repayments of Interest Drawings under such Liquidity Facility while subclause (A)(i) above is applicable) shall be deposited in such Cash Collateral Account, (B) if any Liquidity Facility shall have 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, 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 (less the amount of any repayments of Interest Drawings under such Liquidity Facility while subclause (B)(i) above is applicable) shall be deposited in such Cash Collateral Account, (C) if, with respect to any particular Liquidity Facility, neither subclause (A) nor subclause (B) of this clause "fourth" is applicable, to pay in full the outstanding amount of all Liquidity Obligations then due under such Liquidity Facility shall be distributed to such Liquidity Provider (other than amounts payable pursuant to clause "second" or "third" of this Section 3.03 and as determined after giving effect to payments made by the Policy Provider to the Liquidity Providers in respect of principal of drawings under the Liquidity Facilities) pro rata with any amount distributable pursuant to subclause (D) of this clause "fourth" on the basis of the amount of all such Liquidity Obligations and unreimbursed Policy Provider Obligations payable to the Policy Provider under subclause (D) of this clause "fourth" and (D) if the Policy Provider has elected to pay to each Liquidity Provider all outstanding drawings and interest owing to such Liquidity Provider under its Liquidity Facility pursuant to Section 2.06(c) hereof, to reimburse the Policy Provider for the principal amount of such payment made to the Liquidity Providers, shall be distributed to the Policy Provider, but only after giving effect to the application of amounts, if any, under subclause (A) or (B) of this clause "fourth", and if any amount shall be distributable under subclause (C) of this clause "fourth", pro rata with any amount distributable pursuant to such subclause (C) on the basis of the amounts of all such unreimbursed Liquidity Obligations and the amount of such unreimbursed Policy Provider Obligations payable to the Policy Provider under this clause "fourth"; fifth, if, with respect to any particular Liquidity Facility, any amounts are to be deposited 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 (less the amount of any repayments of Interest Drawings under such Liquidity Facility while subclause (A)(i) or (B)(i), as the case may be, of clause "fourth" above is applicable), 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 or other loss incurred by, or any other amount payable to, such Trustee under the applicable Trust Agreements (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 5.02 in respect of amounts described in clause (i) above (without duplication of any amounts distributed pursuant to subclause (iv) of clause "first" of this Section 3.03), shall be distributed to 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), (ii) and (iii) above; seventh, if any Class G-1 Certificates or Class G-2 Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Adjusted Expected Distributions on the Class G-1 Certificates shall be distributed to the Class G-1 Trustee and such amount as shall be required to pay in full Adjusted Expected Distributions on the Class G-2 Certificates shall be distributed to the Class G-2 Trustee, pro rata on the basis of such amounts in respect of each such Class of Certificates; eighth, such amount as shall be required to pay the Policy Provider Obligations then due to the Policy Provider under the Policy Provider Agreement (other than amounts payable pursuant to clauses "first" through "fourth" above and other than any Excess Reimbursement Obligations) and any amounts due under the Policy Fee Letter shall be paid to the Policy Provider; ninth, if any Class C Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Adjusted Expected Distributions on the Class C Certificates shall be distributed to the Class C Trustee; tenth, such amount as shall be required to pay any Excess Reimbursement Obligations shall be distributed to the Policy Provider; eleventh, if any Class D Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay in full Adjusted Expected Distributions on the Class D Certificates shall be distributed to the Class D Trustee; and twelfth, (i) if any Class G-1 Certificates or Class G-2 Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay Final Distributions on the Class G-1 Certificates shall be distributed to the Class G-1 Trustee and such amount as shall be required to pay Final Distributions on the Class G-2 Certificates shall be distributed to the Class G-2 Trustee, pro rata on the basis of the Pool Balance of each such Class of Certificates after giving effect to the distributions made on such Distribution Date pursuant to clause "seventh" of this Section 3.03(a); (ii) after giving effect to clause (i) if any Class C Certificates are Outstanding on such Distribution Date, such amount remaining as shall be required to pay Final Distributions on the Class C Certificates shall be distributed to the Class C Trustee and (iii) after giving effect to clauses (i) and (ii) if any Class D Certificates are Outstanding on such Distribution Date, such amount as shall be required to pay Final Distributions on the Class D Certificates shall be distributed to the Class D Trustee. Section 3.04. 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 in the order of priority specified in Section 3.03; provided, however, that to the extent any such payments are received or realized at any time after the Final Distributions for all Classes of Certificates have been made, such payments shall be distributed in the following order of priority: first, in the manner provided in clause "first" of Section 3.03 and second, in the manner provided in clause "eleventh" of Section 3.02. (b) On any Interest Payment Date under each Liquidity Facility which is not a Distribution Date, the Subordination Agent shall pay to the Liquidity Provider under such Liquidity Facility from, and to the extent of, amounts on deposit in the Collection Account, an amount equal to the amount of interest then due and payable to such Liquidity Provider under such Liquidity Facility. (c) Except as otherwise provided in Section 3.03 or Sections 3.06(a) and 3.06(b), 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 3.02; provided that, for the purposes of this Section 3.04(c) only, each reference in clause "tenth" of Section 3.02 to "Distribution Date" shall be deemed to mean the actual date of payment of such Scheduled Payment and each reference in clause "fifth", "seventh" or "ninth" of Section 3.02 to "Distribution Date" shall be deemed to refer to such Scheduled Payment Date. Section 3.05. Payments to the Trustees, the Liquidity Providers and the Policy Provider. Any amounts distributed hereunder to any Liquidity Provider or the Policy Provider shall be paid to such Liquidity Provider or the Policy Provider, as the case may be, by wire transfer of funds to the address such Liquidity Provider or the Policy Provider, as the case may be, shall provide to the Subordination Agent. The Subordination Agent shall provide a Written Notice of any such transfer to the applicable Liquidity Provider or the Policy Provider, as the case may be, at the time of such transfer. Any amounts distributed hereunder by the Subordination Agent to any Trustee that is not the same institution as the Subordination Agent shall be paid to such Trustee by wire transfer of funds at the address such Trustee shall provide to the Subordination Agent. Section 3.06. Liquidity Facilities. (a) Interest Drawings. If on any Distribution Date, after giving effect to the subordination provisions of this Agreement and any payment made by the Policy Provider pursuant to subclause (ii) of Section 3.07(c), 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 G-1 Certificates, the Class G-2 Certificates or the Class C Certificates (at the Stated Interest Rate for such Class of Certificates), then, prior to 1:00 p.m. (New York City time) on such Distribution Date, the Subordination Agent shall request a drawing (each such drawing, an "Interest Drawing") under the Liquidity Facility with respect to such Class of Certificates (and concurrently with the making of such request, the Subordination Agent shall give notice to the Policy Provider of such insufficiency of funds) in an amount equal to the lesser of (i) an amount sufficient to pay the amount of such accrued interest (at the Stated Interest Rate for each such Class of Certificates) and (ii) the Available Amount under such Liquidity Facility, and shall upon receipt of such amount pay such amount to the Trustee with respect to each such Class of Certificates in payment of such accrued interest as provided in Section 3.06(b). (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 G-1 Liquidity Facility and all amounts withdrawn by the Subordination Agent from the Class G-1 Cash Collateral Account, and payable in each case to the Class G-1 Certificateholders, shall be promptly distributed to the Class G-1 Trustee, (ii) all payments received by the Subordination Agent in respect of an Interest Drawing under the Class G-2 Liquidity Facility and all amounts withdrawn by the Subordination Agent from the Class G-2 Cash Collateral Account, and payable in each case to the Class G-2 Certificateholders, shall be promptly distributed to the Class G-2 Trustee and (iii) all payments received by the Subordination Agent in respect of an Interest Drawing under the Class C Liquidity Facility and all amounts withdrawn by the Subordination Agent from the Class C Cash Collateral Account, and payable in each case to the Class C Certificateholders, shall be promptly distributed to the Class C Trustee. (c) Downgrade Drawings. The Liquidity Provider will promptly, but in any event within ten days of its receipt of notice thereof, deliver notice of any downgrading of its debt ratings to the Subordination Agent, the Policy Provider, and Delta. If at any time the short-term unsecured debt rating of any Liquidity Provider issued by Moody's or the short-term corporate credit rating of such Liquidity Provider issued by S&P (or if such Liquidity Provider does not have a short-term unsecured debt rating or short-term corporate credit rating, as applicable, issued by Moody's or S&P, the long-term unsecured debt rating or long-term corporate credit rating of such Liquidity Provider issued by such Rating Agency) is lower than the applicable Threshold Rating, within 10 days after such downgrading (or within 45 days of such downgrading solely in the event of a downgrading of such Liquidity Provider's short-term corporate credit rating by S&P from A-1+ to A-1) (but not later than the expiration date of the Liquidity Facility issued by such downgraded Liquidity Provider (the "Downgraded Facility")), such Liquidity Provider or Delta may arrange for a Replacement Liquidity Provider to issue and deliver a Replacement Liquidity Facility to the Subordination Agent. If a Downgraded Facility has not been replaced in accordance with the terms of this paragraph, the Subordination Agent shall, on such 10th (or 45th) day (or if such 10th (or 45th) day is not a Business Day, on the next succeeding Business Day) (or, if earlier, on the 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 all available and undrawn amounts thereunder. Amounts drawn pursuant to a Downgrade Drawing shall be maintained and invested as provided in Section 3.06(f). Subject to Section 3.06(e)(iii), the 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 the Liquidity Provider. (d) Non-Extension Drawings. If 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 applicable Stated Expiration Date, the Subordination Agent shall request in writing that such Liquidity Provider extend the Stated Expiration Date to the earlier of (i) the date that is 15 days after the Final Legal Distribution Date for such Class of Certificates and (ii) the date that is the day immediately preceding the 364th day after the last day of the Consent Period (unless the obligations of such Liquidity Provider thereunder are earlier terminated in accordance with such Liquidity Facility). The Liquidity Provider shall by notice (the "Consent Notice") to the Subordination Agent, during the period commencing on the date that is 60 days prior to the then effective Stated Expiration Date and ending on the date that is 25 days prior to such Stated Expiration Date (the "Consent Period") advise the Subordination Agent whether, in its sole discretion, it agrees to so extend the Stated Expiration Date; provided, however, that such extension shall not be effective with respect to such Liquidity Provider if, by notice (the "Withdrawal Notice") to the Subordination Agent prior to the end of the Consent Period, the Liquidity Provider revokes the Consent Notice. If the Liquidity Provider advises the Subordination Agent in the Consent Notice that such Stated Expiration Date shall not be so extended, gives a Withdrawal Notice to the Subordination Agent prior to the end of the Consent Period, or fails to irrevocably and unconditionally advise the Subordination Agent on or before the end of the Consent Period that such Stated Expiration Date shall be so extended (and, in each case, if the Liquidity Provider shall not have been replaced in accordance with Section 3.06(e)), the Subordination Agent shall, on the date on which the Consent Period ends (or as soon as possible thereafter but prior to the Stated Expiration Date), in accordance with and to the extent permitted by 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 all available and undrawn amounts thereunder. Amounts drawn pursuant to a Non-Extension Drawing shall be maintained and invested in accordance with Section 3.06(f). If any amounts shall be drawn pursuant to a Non-Extension Drawing and, within 30 days thereafter, the Liquidity Provider shall not have been replaced, then at any time following the 30th day after such Non-Extension Drawing, the Liquidity Provider may, by written notice to the Subordination Agent, agree to reinstate the Liquidity Facility on the terms of the existing Liquidity Facility for a period ending on the 364th day after the end of the Consent Period; provided, however, that in such event the Liquidity Provider shall reimburse the Subordination Agent for any costs actually incurred by or on behalf of the Subordination Agent in drawing pursuant to the Non-Extension Drawing and funding the Cash Collateral Account or otherwise in connection with the Non-Extension Drawing. (e) Issuance of Replacement Liquidity Facility. (i) Subject to Section 3.06(e)(iii), at any time, Delta 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 3.06(e)(ii)); provided, however, that if the initial Liquidity Provider is replaced it shall be replaced with respect to all Liquidity Facilities under which it is a Liquidity Provider, and provided further, however, that the initial Liquidity Provider shall not be replaced by Delta as the Liquidity Provider with respect to any Class of Certificates prior to the fifth anniversary of the Closing Date unless (A) there shall have become due to the initial Liquidity Provider, or the initial Liquidity Provider shall have demanded, amounts pursuant to Section 3.01 or 3.03 of any Liquidity Facility and the replacement of the initial Liquidity Provider would reduce or eliminate the obligation to pay such amounts or Delta determines in good faith that there is a substantial likelihood that the initial Liquidity Provider will have the right to claim any such amounts within 180 days after the date of such determination (unless the initial Liquidity Provider waives, in writing, any right it may have to claim such amounts), which determination shall be set forth in a certificate delivered by Delta to the initial Liquidity Provider accompanied by an opinion of outside counsel selected by Delta 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 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 the initial Liquidity Provider to maintain or fund its LIBOR Advances as described in Section 3.10 of any Liquidity Facility, (C) the short-term corporate credit rating of the initial Liquidity Provider is downgraded by S&P from A-1+ to A-1 and there is a resulting downgrade in the rating by either Rating Agency of any Class of Certificates (without regard to the related Policy in the case of the Class G-1 Certificates and Class G-2 Certificates), (D) 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 or (E) the initial Liquidity Provider shall have breached any of its payment (including, without limitation, funding) obligations under any Liquidity Facility. If such Replacement Liquidity Facility is provided at any time after a Downgrade Drawing or a Non-Extension Drawing has been made, all funds on deposit in the relevant Cash Collateral Account resulting from such Downgrade Drawing or Non-Extension Drawing will be returned to the Liquidity Provider being replaced. (ii) If any Liquidity Provider shall determine not to extend its Liquidity Facility in accordance with Section 3.06(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 Stated Expiration Date of such Liquidity Facility. (iii) No Replacement Liquidity Facility arranged by Delta or a Liquidity Provider in accordance with Section 3.06(c) or clause (i) or (ii) of this Section 3.06(e) 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 Section 3.06(e)(iv) below shall have been satisfied and (B) in the case of a Replacement Liquidity Facility arranged by a Liquidity Provider under Section 3.06(c) or Section 3.06(e)(ii), such Replacement Liquidity Provider and such Replacement Liquidity Facility (including the fees, compensation, interest, increased costs or withholding payable thereunder to the Replacement Liquidity Provider) are reasonably acceptable to Delta. (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 3.06(c) and without regard to any Policy), and in the case of the Class G-1 Liquidity Facility or the Class G-2 Liquidity Facility, the written consent of the Policy Provider (which consent shall not be unreasonably withheld or delayed), (y) pay all Liquidity Obligations then owing to the replaced Liquidity Provider (which payment shall be made first from available funds in the applicable Cash Collateral Account as described in Section 3.06(f)(ix), 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 addressed to the Subordination Agent, the Policy Provider, the Trustees and Delta opining that such Replacement Liquidity Facility is an enforceable obligation of such Replacement Liquidity Provider. (v) Upon satisfaction of the conditions set forth in Sections 3.06(e)(iii) and 3.06(e)(iv), (1) the replaced Liquidity Facility shall terminate, (2) the Subordination Agent shall, if and to the extent so requested by Delta 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 Letter, (3) each of the parties hereto shall enter into any amendments to this Agreement necessary to give effect to the replacement of the applicable Liquidity Provider with the applicable Replacement Liquidity Provider and the replacement of the applicable Liquidity Facility with the applicable Replacement Liquidity Facility and (4) 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. If the Subordination Agent shall draw all available amounts under the Class G-1 Liquidity Facility, the Class G-2 Liquidity Facility, or the Class C Liquidity Facility pursuant to Section 3.06(c), 3.06(d) or 3.06(i), or in the event amounts are to be deposited in the Cash Collateral Account pursuant to subclause (A) or (B) of clause "third" of Section 2.04(b), subclause (A) or (B) of clause "third" of Section 3.02 or subclause (A) or (B) of clause "fourth" of Section 3.03, amounts so drawn or to be deposited, as the case may be, shall be deposited by the Subordination Agent in the Class G-1 Cash Collateral Account, the Class G-2 Cash Collateral Account or the Class C Cash Collateral Account, respectively. All amounts on deposit in each Cash Collateral Account shall be invested and reinvested in Eligible Investments in accordance with Section 2.02(b). On each Interest Payment Date (or, in the case of any Special Distribution Date occurring prior to the occurrence of a Triggering Event, on such Special Distribution Date), Investment Earnings on amounts on deposit in each Cash Collateral Account (or in the case of any Special Distribution Date occurring prior to the occurrence of a Triggering Event, an amount of such Investment Earnings on amounts of deposits in each Cash Collateral Account equal to the product of such Investment Earnings multiplied by a fraction, the numerator of which is the aggregate outstanding principal amount of Equipment Notes being redeemed, purchased or prepaid on such Special Distribution Date and the denominator of which is the aggregate outstanding principal amount of all Equipment Notes) shall be deposited in the Collection Account (or, in the case of any Special Distribution Date occurring prior to the occurrence of a Triggering Event, the Special Payments Account) and applied on such Interest Payment Date (or Special Distribution Date, as the case may be) in accordance with Section 2.04(b), 3.02, 3.03 or 3.04(b) (as applicable). The Subordination Agent shall deliver a written statement to Delta and the 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 account as follows: (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 G-1 Certificates (at the Stated Interest Rate for the Class G-1 Certificates) from any other source (including any payment made by the Policy Provider pursuant to subclause (ii) of the second paragraph of Section 3.07(c)), withdraw from the Class G-1 Cash Collateral Account, and pay to the Class G-1 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 G-1 Certificates) on such Class G-1 Certificates and (y) the amount on deposit in the Class G-1 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 G-2 Certificates (at the Stated Interest Rate for the Class G-2 Certificates) from any other source (including any payment made by the Policy Provider pursuant to subclause (ii) of the second paragraph of Section 3.07(c)), withdraw from the Class G-2 Cash Collateral Account, and pay to the Class G-2 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 G-2 Certificates) on such Class G-2 Certificates and (y) the amount on deposit in the Class G-2 Cash Collateral Account; (iii) 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 C Certificates (at the Stated Interest Rate for the Class C Certificates) from any other source, withdraw from the Class C Cash Collateral Account, and pay to the Class C 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 C Certificates) on such Class C Certificates and (y) the amount on deposit in the Class C Cash Collateral Account; (iv) on each date on which the Pool Balance of the Class G-1 Trust shall have been reduced by payments made to the Class G-1 Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the Subordination Agent shall withdraw from the Class G-1 Cash Collateral Account such amount as is necessary so that, after giving effect to the reduction of such Pool Balance on such date (including any such reduction resulting from a prior withdrawal of amounts on deposit in the Class G-1 Cash Collateral Account on such date) and any transfer of Investment Earnings from such Class G-1 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 G-1 Liquidity Facility) plus the remaining Investment Earnings on deposit in such Class G-1 Cash Collateral Account (if any) will be on deposit in the Class G-1 Cash Collateral Account and shall, first, pay such withdrawn amount to the relevant Class G-1 Liquidity Provider until the Liquidity Obligations (with respect to the Class G-1 Certificates) owing to such Class G-1 Liquidity Provider shall have been paid in full and, second, deposit any remaining amount in the Collection Account; (v) on each date on which the Pool Balance of the Class G-2 Trust shall have been reduced by payments made to the Class G-2 Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the Subordination Agent shall withdraw from the Class G-2 Cash Collateral Account such amount as is necessary so that, after giving effect to the reduction of such Pool Balance on such date (including any such reduction resulting from a prior withdrawal of amounts on deposit in the Class G-2 Cash Collateral Account on such date) and any transfer of Investment Earnings from such Class G-2 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 G-2 Liquidity Facility) plus the remaining Investment Earnings on deposit in such Class G-2 Cash Collateral Account (if any) will be on deposit in the Class G-2 Cash Collateral Account and shall, first, pay such withdrawn amount to the relevant Class G-2 Liquidity Provider until the Liquidity Obligations (with respect to the Class G-2 Certificates) owing to such Class G-2 Liquidity Provider shall have been paid in full and, second, deposit any remaining amount in the Collection Account; (vi) on each date on which the Pool Balance of the Class C Trust shall have been reduced by payments made to the Class C Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the Subordination Agent shall withdraw from the Class C Cash Collateral Account such amount as is necessary so that, after giving effect to the reduction of such Pool Balance on such date (including any such reduction resulting from a prior withdrawal of amounts on deposit in the Class C Cash Collateral Account on such date) and any transfer of Investment Earnings from such Class C 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 C Liquidity Facility) plus the remaining Investment Earnings on deposit in such Class C Cash Collateral Account (if any) will be on deposit in the Class C Cash Collateral Account and shall, first, pay such withdrawn amount to the relevant Class C Liquidity Provider until the Liquidity Obligations (with respect to the Class C Certificates) owing to such Class C Liquidity Provider shall have been paid in full and, second, deposit any remaining amount in the Collection Account; (vii) 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 for such Class of Certificates, the Subordination Agent shall withdraw all amounts remaining 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 deposit any remaining amount in the Collection Account; and (viii) 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 in respect of such Class of Certificates and 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 the Available Amount of 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 shall have occurred with respect to such Liquidity Facility. In the event that, with respect to any particular Liquidity Facility, (i) funds are withdrawn from any Cash Collateral Account pursuant to clause (i), (ii), (iii) or (iv) of Section 3.06(f) 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 both a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing with respect to such Liquidity Facility or (y) any time after a Final Drawing shall have occurred with respect to such Liquidity Facility, shall be deposited in such Cash Collateral Account as and to the extent provided in clause "third" of Section 2.04(b), clause "third" of Section 3.02 or clause "fourth" of Section 3.03, as applicable, and applied in accordance with Section 3.06(f). (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 and to the extent permitted by 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 3.06(f). (j) Reduction 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, the Subordination Agent shall, if any such Liquidity Facility provides for reductions of the Stated Amount of such Liquidity Facility and if such reductions are not automatic, request such Liquidity Provider for such Class of Certificates to reduce such Stated Amount 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). Each such request shall be made in accordance with the provisions of the applicable Liquidity Facility. (k) Relation to Subordination Provisions. Interest Drawings under the Liquidity Facilities and withdrawals from the Cash Collateral Accounts, 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 Sections 2.04(b), 3.02, 3.03 and 3.06. (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) Delta 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. Section 3.07. The Policies. The following provisions of paragraphs (a) through (i) of this Section 3.07 shall apply to (i) the Class G-1 Trust and the Class G-1 Certificates and (ii) the Class G-2 Trust and the Class G-2 Certificates, as if such provisions are separately set forth in full for each of the Class G-1 Trust (and the Class G-1 Certificates) and the Class G-2 Trust (and the Class G-2 Certificates). For the purposes of clause (i) above, each reference in paragraphs (a) through (i) of this Section 3.07 to "Accrued Class G Interest", "Class G Cash Collateral Account", "Class G Certificates", "Class G Certificateholders", "Class G Liquidity Facility", "Class G Trustee", "Policy", "Policy Account" and "Series G Equipment Note" shall mean "Accrued Class G-1 Interest", "Class G-1 Cash Collateral Account", "Class G-1 Certificates", "Class G-1 Certificateholders", "Class G-1 Liquidity Facility", "Class G-1 Trustee", "Class G-1 Policy", "Class G-1 Policy Account" and "Series G-1 Equipment Note", respectively. For the purposes of clause (ii) above, each reference in paragraphs (a) through (i) of this Section 3.07 to "Accrued Class G Interest", "Class G Cash Collateral Account", "Class G Certificates", "Class G Certificateholders", "Class G Liquidity Facility", "Class G Trustee", "Policy", "Policy Account" and "Series G Equipment Note" shall mean "Accrued Class G-2 Interest", "Class G-2 Cash Collateral Account", "Class G-2 Certificates", "Class G-2 Certificateholders", "Class G-2 Liquidity Facility", "Class G-2 Trustee", "Class G-2 Policy", "Class G-2 Policy Account" and "Series G-2 Equipment Note", respectively. (a) Interest Drawings. If on any Regular Distribution Date (other than the Final Legal Distribution Date) after giving effect to the application of available funds in accordance with the priorities specified in Section 2.04 and Article III, and taking into account the application of any Drawing paid under the Class G Liquidity Facility in respect of accrued interest and any withdrawal of funds from the Class G Cash Collateral Account in respect of such interest, the Subordination Agent does not then have sufficient funds available for the payment of Accrued Class G Interest, then, prior to 1:00 p.m. (New York City time) on such Distribution Date, the Subordination Agent (i) shall deliver a Notice of Nonpayment, as provided in the Policy to the Policy Provider or its fiscal agent, requesting a Policy Drawing under the Policy (for payment into the Policy Account) in an amount sufficient to enable the Subordination Agent to pay such Accrued Class G Interest and (ii) shall pay such amount from the Policy Account to the Class G Trustee in payment of such Accrued Class G Interest on such Distribution Date. (b) Proceeds Deficiency Drawing. If on any Special Distribution Date (other than a Special Distribution Date established pursuant to the second paragraph of Section 3.07(c)) established by the Subordination Agent by reason of its receipt of a Special Payment (a "Disposition Payment") constituting the proceeds of any Series G Equipment Note or related Collateral or Indenture Estate, as the case may be, there exists a shortfall in the amounts available to the Subordination Agent (after giving effect to the application of available funds (including, without limitation, the amount of such Disposition Payment) in accordance with the priorities specified in Section 2.04 and Article III, and (if the disposition of such Series G Equipment Note or related Collateral or Indenture Estate occurs prior to a Policy Provider Election with respect to such Series G Equipment Note) taking into account the application of any Drawing paid under the Class G Liquidity Facility in respect of such interest, any withdrawal of funds in the Class G Collateral Account in respect of such interest) required to reduce the outstanding Pool Balance of the Class G Certificates by an amount equal to the outstanding principal amount of the applicable Series G Equipment Note (determined immediately prior to the receipt of such Disposition Payment and less the amount of any Policy Drawing previously paid by the Policy Provider in respect of principal of such Series G Equipment Note) plus accrued and unpaid interest on the amount of such reduction accrued at the Stated Interest Rate for the Class G Certificates for the period from the immediately preceding Regular Distribution Date to such Special Distribution Date, then, prior to 1:00 p.m. (New York City time) on such Special Distribution Date, the Subordination Agent (x) shall deliver a Notice of Nonpayment, as provided in the Policy (for payment into the Policy Account) in an amount equal to the amount of such shortfall and (y) shall pay such amount from the Policy Account to the Class G Trustee in payment of such reduction in the outstanding Pool Balance of the Class G Certificates plus such accrued and unpaid interest on such Special Distribution Date. The Subordination Agent shall promptly, but not less than 20 days prior to the Special Distribution Date established pursuant to this Section 3.07(b), send to Delta, the Trustees, the Liquidity Provider for the Class G Liquidity Facility and the Policy Provider, a Written Notice of such Special Distribution Date. (c) No Proceeds Drawing. On the first Business Day that is 18 months after the last date on which full payment was made on any Series G Equipment Note (a "Defaulted Series G Equipment Note") as to which there has subsequently been a failure to pay principal or that has subsequently been accelerated, if the Subordination Agent has not theretofore made a drawing under the Policy pursuant to Section 3.07(b), the Subordination Agent shall deliver a Notice of Nonpayment, as provided in the Policy, to the Policy Provider or its fiscal agent, requesting a Policy Drawing under the Policy (for payment into the Policy Account) in an amount equal to the then outstanding principal amount of such Defaulted Series G Equipment Note plus accrued and unpaid interest thereon from the immediately preceding Regular Distribution Date. The Subordination Agent shall promptly, but not less than 25 days prior to the such Business Day, send to Delta, the Trustees, the Liquidity Provider for the Class G Liquidity Facility and the Policy Provider a Written Notice establishing such Business Day as the date for the distribution of the proceeds of such Policy Drawing, which date shall constitute a Special Distribution Date. No later than 1:00 p.m. (New York City time) on the specified Special Distribution Date the Subordination Agent shall make the specified Policy Drawing and upon its receipt of the proceeds thereof pay the amount thereof from the Policy Account to the Class G Trustee in reduction of the outstanding Pool Balance of the Class G Certificates together with such accrued and unpaid interest on the amount of such reduction. For the avoidance of doubt, after the payment by the Policy Provider in full of such amount under this Section 3.07(c), the Subordination Agent shall have no right to make any further Policy Drawings under Section 3.07(c) in respect of such Defaulted Series G Equipment Note except for a drawing under Section 3.07(e). Notwithstanding the foregoing, the Policy Provider has the right, so long as no Policy Provider Default shall have occurred and be continuing, upon notice to the Subordination Agent given at least five days prior to the Special Distribution Date established by the Subordination Agent pursuant to the first paragraph of this Section 3.07(c), to elect instead (the "Policy Provider Election") to pay (i) on such Special Distribution Date an amount equal to the scheduled principal and interest that came due on such Defaulted Series G Equipment Note (without regard to the acceleration thereof) but was not paid during such 18-month period (after giving effect to the application of funds received from the Class G Liquidity Facility and the Class G Cash Collateral Account, in each case attributable to such interest) and (ii) thereafter, on each Regular Distribution Date, an amount equal to the scheduled principal and interest that were to become due on such Defaulted Series G Equipment Note on the related payment date (without regard to any acceleration thereof or to any funds available under any Liquidity Facility or any Cash Collateral Account) until the establishment of an Election Distribution Date or a Special Distribution Date established as provided in the immediately following sentence. Following a Policy Provider Election with respect to a Defaulted Series G Equipment Note, on any Business Day (which shall be a Special Distribution Date) elected by the Policy Provider upon 20 days' Written Notice to the Subordination Agent and the Class G Trustee, the Policy Provider may, notwithstanding the Policy Provider Election, request the Subordination Agent to, and the Subordination Agent shall, make a Policy Drawing for an amount equal to the then outstanding principal balance of such Defaulted Series G Equipment Note (less any Policy Drawings previously paid by the Policy Provider in respect of principal of such Defaulted Series G Equipment Note) and accrued and unpaid interest on such amounts at the Stated Interest Rate for the Class G Certificates from the previous Regular Distribution Date to such Special Distribution Date. Further, following a Policy Provider Election with respect to a Defaulted Series G Equipment Note, upon the occurrence and continuance of a Policy Provider Default, the Subordination Agent shall on any Business Day (an "Election Distribution Date", which shall be a Special Distribution Date) elected by the Subordination Agent upon 20 days' Written Notice to the Class G Trustee and the Policy Provider, make a Policy Drawing for an amount equal to the then outstanding principal balance of such Defaulted Series G Equipment Note (less any Policy Drawings previously paid by the Policy Provider in respect of principal of such Equipment Note) and accrued and unpaid interest on such amounts at the Stated Interest Rate for the Class G Certificates from the immediately preceding Regular Distribution Date to such Election Distribution Date. The Subordination Agent shall make each such Policy Drawing referred to in this subparagraph (c) under the Policy (for payment into the Policy Account) no later than 1:00 p.m. (New York City time) on the relevant Special Distribution Date and upon its receipt of the proceeds thereof pay the amount thereof from the Policy Account to the Class G Trustee in reduction of the outstanding Pool Balance of the Class G Certificates together with such accrued and unpaid interest thereon. In addition, regardless of whether or not the Policy Provider makes a Policy Provider Election, the Policy Provider shall, at the end of the first occurring 18-month period described in Section 3.07(c), endorse the Policy (if not already endorsed to so provide) to provide for the payment to the Liquidity Providers of interest accruing on the outstanding drawings in respect of the Liquidity Facilities from and after the end of such 18-month period as and when such interest becomes due in accordance with such Liquidity Facilities. The Policy Provider hereby agrees not to otherwise amend or modify the Policy without the consent of the Liquidity Provider if such amendment or modification would adversely affect the rights of the Liquidity Provider. (d) Final Policy Drawing. If on the Final Legal Distribution Date of the Class G Certificates after giving effect to the application of available funds in accordance with the priorities specified in Section 2.04 and Article III, and taking into account the application of any Drawing paid under the Class G Liquidity Facility in respect of interest included in the Final Distribution and any withdrawal of funds in the Class G Cash Collateral Account in respect of interest included in the Final Distribution, the Subordination Agent does not then have sufficient funds available on such date for the payment in full of the Final Distribution (calculated as at such date but excluding any accrued and unpaid premium) on the Class G Certificates then, prior to 1:00 p.m. (New York City time) on such date, the Subordination Agent shall: (i) deliver a Notice of Nonpayment, as provided in the Policy, to the Policy Provider or its fiscal agent, requesting a Policy Drawing under the Policy (for payment into the Policy Account) in an amount equal to the minimum amount sufficient to enable the Subordination Agent to pay the Final Distribution (calculated as at such date but excluding any accrued and unpaid premium) on the Class G Certificates, and (ii) shall pay such amount from the Policy Account to the Class G Trustee in payment of such amount on such date. (e) Avoidance Drawings. If at any time the Subordination Agent shall have actual knowledge of the issuance of any Final Order, the Subordination Agent shall promptly give notice thereof to Delta, each Trustee, the Liquidity Providers and the Policy Provider. The Subordination Agent shall thereupon calculate the relevant Avoided Payments resulting therefrom and shall promptly: (a) send to the Class G Trustee a Written Notice of such amount and (b) deliver to the Policy Provider, or its fiscal agent, a Notice of Avoided Payment, together with a copy of the documentation required by the Policy with respect thereto, requesting a Policy Drawing (for payment to the receiver, conservator, debtor-in-possession or trustee in bankruptcy and/or the Subordination Agent for deposit into the Policy Account) in an amount equal to the amount of relevant Avoided Payment. Such Written Notice shall also set the date for the distribution of the proceeds of such Policy Drawing, which date shall constitute a Special Distribution Date and shall be the earlier of the third Business Day that immediately precedes the expiration of the Policy and the Business Day that immediately follows the 25th day after the date of such Written Notice. No later than 1:00 p.m. (New York City time) on the specified Special Distribution Date, the Subordination Agent shall make the specified Policy Drawing and, upon its receipt of the proceeds thereof, pay the amount thereof from the Policy Account to the Class G Trustee in reinstatement of the Avoided Payment. (f) Application of Policy Drawings. Notwithstanding anything to the contrary contained in this Agreement (including, without limitation, Sections 2.04, 3.02 and 3.03 hereof), all payments received by the Subordination Agent in respect of a Policy Drawing shall be promptly paid from the Policy Account to the Class G Trustee for distribution to the Class G Certificateholders. (g) Reduction of Outstanding Pool Balance. Promptly following each date on which the Pool Balance of the Class G Certificates is reduced as a result of a payment under this Agreement, the Subordination Agent shall inform the Policy Provider of such reduction. Anything contained herein to the contrary notwithstanding, (i) no Policy Drawing for payment in respect of the Class G Certificates under clause (a) of this Section 3.07 shall be in excess of Accrued Class G Interest and (ii) no Policy Drawing under clauses (b)-(d) of this Section 3.07 shall be for an amount in excess of the outstanding Pool Balance of the Class G Certificates plus accrued and unpaid interest thereon at the Stated Interest Rate for the Class G Certificates. Nothing contained in this Intercreditor Agreement shall be deemed to alter or amend the liabilities, obligations, requirements or procedures of the Policy Provider under the Policy and the Policy Provider shall not be obligated to make payment except at the times and in the amounts and under the circumstances expressly set forth in the Policy. (h) Resubmission of Notice of Payment. If the Policy Provider at any time informs the Subordination Agent in accordance with the Policy that a Notice of Nonpayment or Notice of Avoided Payment submitted by the Subordination Agent does not satisfy the requirements of the Policy, the Subordination Agent shall, as promptly as possible after being so informed, submit to the Policy Provider an amended and revised Notice of Nonpayment or Notice of Avoided Payment, as the case may be, and shall pay to the Class G Trustee out of the Policy Account the amount received pursuant to such amended or revised Notice of Nonpayment or Notice of Avoided Payment, as the case may be, when received. (i) Subrogation. The Policy Provider will be subrogated to all of the rights of the holders of the Class G Certificates to payment on the Class G Certificates to the extent of the payments made under the Policy as set forth herein, the exercise of such subrogation right to be subject to the other provisions of this Agreement. ARTICLE IV EXERCISE OF REMEDIES Section 4.01. Directions from the Controlling Party. (a) (i) Following the occurrence and during the continuation of an Indenture Event of Default under any Indenture, the Controlling Party shall direct the Subordination Agent, which in turn shall direct the Loan Trustee under such Indenture, in the exercise of remedies available to the holders of the Equipment Notes issued pursuant to such Indenture, including, without limitation, the ability to vote all such Equipment Notes in favor of Accelerating such Equipment Notes in accordance with the provisions of such Indenture. Subject to the Owner Trustees' and the Owner Participants' rights set-forth in the Indentures with respect to Leased Aircraft to purchase the Equipment Notes, if the Equipment Notes issued pursuant to any Indenture have been Accelerated following an Indenture Event of 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 and in accordance with applicable law. (ii) Subject to the Owner Trustees' and the Owner Participants' rights set-forth in the Indentures with respect to Leased Aircraft to purchase the Equipment Notes, and 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 or (y) the occurrence of a Delta Bankruptcy Event, without the consent of each Trustee (other than the Trustee of any Trust all of the Certificates of which are held or beneficially owned by Delta and/or its Affiliates), (A) 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 and (B) with respect to any Leased Aircraft, the amount and payment dates of rentals payable by Delta under the Lease for such Aircraft may not be adjusted, if, as a result of such adjustment, the discounted present value of all such rentals would be less than 75% of the discounted present value of the rentals payable by Delta under such Lease before giving effect to such adjustment, in each case, using the weighted average interest rate of the Equipment Notes issued pursuant to such Indenture as the discount rate. (iii) At the request of the Controlling Party, the Subordination Agent may from time to time during the continuance of an Indenture Event of Default (and before the occurrence of a Triggering Event) commission an LTV Appraisal with respect to the Aircraft subject to such Indenture. (iv) After a Triggering Event occurs and any Equipment Note becomes a Non-Performing Equipment Note, the Subordination Agent shall obtain Appraisals with respect to all of the Aircraft (the "LTV Appraisals") as soon as practicable and additional LTV Appraisals on or prior to each anniversary of the date of such initial LTV Appraisals; provided that, if the Controlling Party reasonably objects to the appraised value of the Aircraft shown in such LTV Appraisals, the Controlling Party shall have the right to obtain or cause to be obtained substitute LTV Appraisals (including any LTV Appraisals based upon physical inspection of the Aircraft). (b) To the extent permitted by applicable law, the Subordination Agent, at the direction of the Controlling Party, shall take such actions as it may reasonably deem most effectual to complete the sale or other disposition of such Aircraft or Equipment Notes. In addition, in lieu of any sale, assignment, contract to sell or other disposition, if the Subordination Agent is so directed by the Controlling Party, the Subordination Agent may maintain possession of such Equipment Notes and continue to apply monies received in respect of such Equipment Notes in accordance with Section 2.04(b) and Article III. 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 direct the Subordination Agent to, subject to the terms and conditions of the related Indenture, instruct the Loan Trustee under such Indenture to foreclose on the Lien on the related Aircraft or take any other remedial action permitted by such Indenture or applicable law. Section 4.02. Remedies Cumulative. Each and every right, power and remedy given to the Trustees, the Liquidity Providers, the Policy Provider, 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 Policy Provider, the Controlling Party or the Subordination Agent, as appropriate, and the exercise or the beginning of the exercise of any right, 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 Policy 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 4.03. 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 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 4.04. Right of Certificateholders to Receive Payments Not to Be Impaired. Subject to the provisions of this Agreement and each Trust Agreement, the right of any Certificateholder or any Liquidity Provider or the Policy Provider, respectively, to receive payments hereunder (including, without limitation, pursuant to Section 2.04, 3.02 or 3.03) 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, such Liquidity Provider or the Policy Provider, respectively. ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC. Section 5.01. Notice of Indenture Event of Default or Triggering Event. (a) If the Subordination Agent shall have knowledge of an Indenture Event of Default or a Triggering Event, as promptly as possible and in any event within ten days after obtaining actual knowledge thereof, the Subordination Agent shall give notice thereof to the Rating Agencies, Delta, the Liquidity Providers, the Policy Provider and the Trustees by telegram, cable, facsimile or telephone (to be promptly confirmed in writing), unless such Indenture Event of Default or Triggering Event shall have been cured or waived. For all purposes of this Agreement, in the absence of actual knowledge, the Subordination Agent shall not be deemed to have knowledge of any Indenture Event of Default or Triggering Event unless notified in writing by Delta, one or more Trustees, one or more Liquidity Providers, the Policy Provider or one or more Certificateholders; and "actual knowledge" (as used in the foregoing clause) of the Subordination Agent shall mean actual knowledge of an officer in the Corporate Trust Office of the Subordination Agent or any other Responsible Officer thereof. (b) Other Notices. The Subordination Agent will furnish to each Liquidity Provider, the Policy 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 to such Liquidity Provider, the Policy Provider or each Trustee, as applicable, pursuant to any other Operative Agreement. Section 5.02. Indemnification. The Subordination Agent shall not be required to take any action or refrain from taking any action under Article IV unless the Subordination Agent shall have received indemnification against any risks incurred in connection therewith in form and substance reasonably satisfactory to it, including, without limitation, adequate advances against costs that may be incurred by it in connection therewith. The Subordination Agent shall not be required to take any action under Article IV, nor shall any other provision of this Agreement or any other Operative Agreement be deemed to impose a duty on the Subordination Agent to take any action, if the Subordination Agent shall have been advised by outside counsel that such action is contrary to the terms hereof or is otherwise contrary to law. Section 5.03. No Duties Except as Specified in 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) promptly take such action as may be necessary duly to discharge all Liens on any of the Trust Accounts or any monies deposited therein that are attributable to the Subordination Agent in its individual capacity and that are unrelated to the transaction contemplated hereby and by the other Operative Agreements. Section 5.04. Notice from the Liquidity Providers and Trustees. If any Liquidity Provider, the Policy Provider or any Trustee has notice of an Indenture Event of Default or a Triggering Event, such Person shall promptly give notice thereof to all other Liquidity Providers, the Policy Provider and all other Trustees and to the Subordination Agent; 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 6.01. Authorization; Acceptance of Trusts and Duties. Each of the Class G-1 Trustee, the Class G-2 Trustee, the Class C Trustee and the Class D 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, the Policy Provider and the Trustees hereby designates and appoints the Subordination Agent as the Subordination Agent under this Agreement. State Street accepts the trusts and duties hereby created and applicable to it and agrees to perform such duties, but only upon the terms of this Agreement and agrees to receive, handle and disburse all monies received by it in accordance with the terms hereof. The Subordination Agent shall have no liability hereunder except (a) for its own willful misconduct or negligence, (b) as provided in Section 2.02 and the last sentence of Section 5.03, (c) for liabilities that may result from the inaccuracy of any representation or warranty of the Subordination Agent made in its individual capacity in any Operative Agreement and (d) as otherwise expressly provided herein or in the other Operative Agreements. Section 6.02. 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 6.03. No Representations or Warranties as to Documents. The Subordination Agent shall not 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 herein or therein (other than the representations and warranties of the Subordination Agent made in its individual capacity under any Operative Agreement), except that the Subordination Agent hereby represents and warrants that each of said specified documents to which it is a party has been or will be duly executed and delivered by one of its officers who is and will be duly authorized to execute and deliver such document on its behalf. The Certificateholders, the Trustees, the Policy Provider and the Liquidity Providers make no representation or warranty hereunder whatsoever. Section 6.04. 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, the Policy Provider or any Liquidity Provider as provided in Articles II and III 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 2.02) 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 6.05. Reliance; Agents; Advice of Counsel. The Subordination Agent shall not incur any 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, the Policy Provider 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, the Policy Provider or Trustee, as the case may be, as to such fact or matter, 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. In the administration of the trusts hereunder, the Subordination Agent may (a) execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents or attorneys and (b) consult with counsel, accountants and other skilled Persons to be selected and retained by it. The Subordination Agent shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled Persons acting within such counsel's, accountants' or Person's area of competence (so long as the Subordination Agent shall have exercised reasonable care and judgment in selecting such Persons). Section 6.06. Capacity in Which Acting. The Subordination Agent acts hereunder solely as agent or trustee herein and not in its individual capacity, except as otherwise expressly provided herein and in the Operative Agreements. Section 6.07. Compensation. The Subordination Agent shall be entitled to such compensation, including reasonable expenses and disbursements, for all services rendered hereunder as Delta and the Subordination Agent may agree from time to time in writing and shall have a priority claim to the extent set forth in Article III 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, the Policy Provider or Liquidity Provider for any fee as compensation for its services as agent under this Agreement. The provisions of this Section 6.07 shall survive the termination of this Agreement. Section 6.08. 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 6.09. Subordination Agent Required; Eligibility. There shall at all times be a Subordination Agent hereunder that is a Citizen of the United States, a bank, trust company or other financial institution organized and doing business under the laws of the United States or any state thereof and eligible to act as a trustee under Section 310(a) of the Trust Indenture Act of 1939, as amended, and that has a combined capital and surplus of at least $75,000,000 (or a combined capital and surplus in excess of $5,000,000 and the obligations of which, whether now in existence or hereafter incurred, are fully and unconditionally guaranteed by a corporation organized under the laws of the United States or any State or territory thereof or the District of Columbia and having a combined capital and surplus of at least $75,000,000). If such bank, trust company or other financial institution or such corporation publishes reports of conditions at least annually, pursuant to law or to the requirements of federal, state, territorial or District of Columbia supervising or examining authority, then for the purposes of this Section 6.09 the combined capital and surplus of such bank, trust company or other financial institution or such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of conditions so published. In case at any time the Subordination Agent shall cease to be eligible in accordance with the provisions of this Section 6.09, the Subordination Agent shall resign immediately in the manner and with the effect specified in Section 7.01. 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 and the Subordination Agent, in its individual capacity, hereby waives all rights of set-off and counterclaim with respect to all such property. ARTICLE VII SUCCESSOR SUBORDINATION AGENT Section 7.01. Replacement of Subordination Agent; Appointment of Successor. (a) The Subordination Agent or any successor thereto must resign if at any time it fails to comply with Section 6.09 and may resign at any time without cause by giving 60 days' prior written notice to Delta, the Trustees, the Policy Provider and the Liquidity Providers. The Controlling Party (or the party that would be the Controlling Party if an Indenture Event of Default had occurred) shall remove the Subordination Agent if: (1) the Subordination Agent fails to comply with Section 6.09; (2) the Subordination Agent is adjudged bankrupt or insolvent or files a bankruptcy petition; (3) a receiver of the Subordination Agent shall be appointed or any public officer shall take charge or control of the Subordination Agent or its property or affairs for the purpose of rehabilitation, conservation or liquidation; 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 (or the party that would be the Controlling Party if an Indenture Event of Default had occurred) shall promptly appoint a successor Subordination Agent. If a successor Subordination Agent shall not have been appointed within 60 days after such notice of resignation or removal, the retiring Subordination Agent, one or more of the Trustees, the Policy Provider or one or more of the Liquidity Providers may petition any court of competent jurisdiction for the appointment of a successor Subordination Agent to act until such time, if any, as a successor shall have been appointed as provided above. 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 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 the Liquidity Providers, the Policy Provider and the Trustees. The retiring Subordination Agent shall promptly transfer its rights under each of the Liquidity Facilities and all of the property and all books and records, or true, complete and correct copies thereof, held by it as Subordination Agent to the successor Subordination Agent. If the Subordination Agent fails to comply with Section 6.09 (to the extent applicable), one or more of the Trustees, the Policy Provider or one or more of the Liquidity Providers may petition a 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 and so long as no Policy Provider Default has occurred and is continuing, the Policy Provider shall have consented to such successor Subordination Agent. (b) Any corporation into which the Subordination Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Subordination Agent shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Subordination Agent, shall be the successor of the Subordination Agent hereunder, provided that such corporation shall be otherwise qualified and eligible under Section 6.09, without the execution or filing of any paper or any further act on the part of any of the parties hereto. ARTICLE VIII SUPPLEMENTS AND AMENDMENTS Section 8.01. Amendments, Waivers, 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 3.06(e)(v)(3) or any amendment contemplated by the last sentence of this Section 8.01(a), with the consent of holders of Certificates of the related Class evidencing Fractional Undivided 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 (including, without limitation, without the consent of the Certificateholders to the extent permitted thereby, Section 9.01 of the Basic Agreement)), the Subordination Agent, the Policy Provider and each Liquidity Provider; provided, however, that this Agreement may be supplemented, amended or modified without the consent of any Trustee in order (i) to cure any ambiguity or omission or to correct any mistake, (ii) to correct or supplement any provision, or (iii) to make any other provision in regard to matters or questions arising hereunder that will not materially adversely affect the interests of any Trustee or the holders of the related Class of Certificates; provided further, however, that, if such supplement, amendment or modification (x) would directly or indirectly amend, modify or supersede, or otherwise conflict with, Section 2.02(b), 3.06(c), 3.06(e), 3.06(f) (other than the last sentence thereof), 3.06(l), this proviso of Section 8.01(a), the last sentence of Section 8.01(a), or Section 9.06 (collectively, the "Delta Provisions"), (y) would otherwise affect the interests of a potential Replacement Liquidity Provider or of Delta with respect to its ability to replace any Liquidity Facility or with respect to its payment obligations under any Operative Agreement or (z) is made pursuant to the last sentence of this Section 8.01(a), then such supplement, amendment or modification shall not be effective without the additional written consent of Delta. Notwithstanding the foregoing, without the consent of each Certificateholder affected thereby, the Policy Provider 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 the last sentence of this Section 8.01(a), modify Section 2.04, 3.02 or 3.03 hereof relating to the distribution of monies received by the Subordination Agent hereunder from the Equipment Notes or pursuant to the Liquidity Facilities or any Policy. Nothing contained in this Section 8.01(a) 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 is to be comprised of more than one instrument as contemplated by the definition of the term "Replacement Liquidity Facility", then each party hereto agrees to amend this Agreement and the other Operative Agreements to incorporate appropriate mechanics for multiple Liquidity Facilities for a single Trust. (b) Subject to Section 2.06, if the Subordination Agent, as the registered holder of any Equipment Notes, receives a request for its consent to any amendment, modification, consent or waiver under such Equipment Notes, to the Indenture pursuant to which such Equipment Notes were issued or the related Lease, Participation Agreement or other related document, (i) if no Indenture Event of 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, except that so long as the Final Distribution on the Class G-1 Certificates or Class G-2 Certificates has not been made or any Policy Provider Obligations or any other obligations owing to the Policy Provider hereunder remain outstanding and no Policy Provider Default shall have occurred and be continuing, the Subordination Agent shall request directions from the Policy Provider rather than the Class G-1 Trustee or Class G-2 Trustee with respect to the Series G-1 Equipment Notes or Series G-2 Equipment Notes held in the Class G-1 Trust or Class G-2 Trust, respectively, and shall vote or consent in accordance with the directions of such Trustee or the Policy Provider, as the case may be, and (ii) if any Indenture Event of Default (which, in the case of any Indenture pertaining to a Leased Aircraft, has not been cured by the applicable Owner Trustee or applicable Owner Participant, if applicable, pursuant to Section 4.03 of such Indenture) shall have occurred and be continuing with respect to such Indenture, the Subordination Agent will exercise its voting rights as directed by the Controlling Party, subject to Section 4.01 and 4.04; provided that no such amendment, modification, consent or waiver shall, without the consent of each Liquidity Provider, the Policy Provider, the Class G-1 Certificateholders and the Class G-2 Certificateholders, (i) reduce the amount of principal or interest payable by Delta under any Equipment Note issued under any Indenture in respect of an Owned Aircraft (other than in connection with a reoptimization relating to a sale/leaseback transaction for a Boeing 737-832 Aircraft) or reduce the amount of rent, supplemental rent, stipulated loss value or termination value payable by Delta under any Lease, (ii) create any Lien with respect to any Collateral or Indenture Estate prior to or pari passu with the Lien of the related Indenture or deprive any holder of an Equipment Note issued under such Indenture of the benefit of the Lien of such Indenture upon the related Collateral or Indenture Estate or (iii) reduce the percentage in principal amount of the outstanding Equipment Notes issued under any Indenture required to take or approve any action render such Indenture. (c) Notwithstanding any provision to the contrary contained herein, so long as Delta and/or its Affiliates holds or beneficially owns a majority in interest of the Class D Certificates or otherwise controls the actions of the Class D Trustee, any consent or approval of the Class D Trustee or any Class D Certificateholders otherwise required in accordance with the foregoing provisions shall not be required. Section 8.02. Subordination Agent Protected. If, in the reasonable opinion of the institution acting as the Subordination Agent hereunder, any document required to be executed by it pursuant to the terms of Section 8.01 adversely affects any right, duty, immunity or indemnity with respect to such institution under this Agreement, any Liquidity Facility or any Policy, the Subordination Agent may in its discretion decline to execute such document. Section 8.03. Effect of Supplemental Agreements. Upon the execution of any amendment, consent or supplement hereto pursuant to the provisions hereof, this Agreement shall be and shall be deemed to 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 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 VIII, 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 8.04. Notice to Rating Agencies and the Policy Provider. Promptly following its receipt of each amendment, consent, modification, supplement or waiver contemplated by this Article VIII, the Subordination Agent shall send a copy thereof to each Rating Agency and the Policy Provider. ARTICLE IX MISCELLANEOUS Section 9.01. Termination of Intercreditor Agreement. Upon (or at any time after) 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 all Policy Provider Obligations to the Policy Provider and provided that there shall then be no other amounts due to the Certificateholders, the Trustees, the Liquidity Providers, the Subordination Agent and the Policy Provider hereunder or under the Trust Agreements, and that the commitment of (i) the Liquidity Providers under the Liquidity Facilities and (ii) the Policy Provider under the Policies shall have expired or been terminated, this Agreement shall terminate and 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 9.02. Intercreditor Agreement for Benefit of Trustees, Liquidity Providers, Policy Provider and Subordination Agent. Subject to the second sentence of Section 9.06 and the provisions of Section 4.04, nothing in this Agreement, whether express or implied, shall be construed to give to any Person other than the Trustees, the Liquidity Providers, the Policy Provider and the Subordination Agent any legal or equitable right, remedy or claim under or in respect of this Agreement. Section 9.03. Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and any such notice may be given by United States mail, courier service or facsimile or any other customary means of communication, and any such notice shall be effective when delivered (or, if mailed, three Business Days after deposit, postage prepaid, in the first class United States mail and, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received), if to the Subordination Agent, to: State Street Bank and Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Telecopy: (860) 244-1881 if to any Trustee, to: State Street Bank and Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Telecopy: (860) 244-1881 if to the Liquidity Provider, to: Westdeutsche Landesbank Girozentrale New York Branch 1211 Avenue of the Americas New York, New York 10036 Attention: Transportation Finance Global Structured Finance/Americas Telecopy: (212) 869-7634 if to the Policy Provider, to: MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Telephone: (917) 273-4949 Telecopy: (917) 765-3163 Any party, by notice to the other parties hereto, may designate additional or different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 9.03. Section 9.04. 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 hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 9.05. 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 9.06. Successors and Assigns. All covenants and agreements contained herein shall bind and inure to the benefit of, and be enforceable by, each of the parties hereto and the successors and permitted assigns of each, all as herein provided. In addition, the Delta Provisions shall inure to the benefit of Delta and its successors and permitted assigns, and (without limitation of the foregoing) Delta is hereby constituted, and agreed to be, an express third party beneficiary of the Delta Provisions. Section 9.07. 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 9.08. Counterparts. This Agreement may be executed in any number of counterparts (and each party shall not be required to execute the same counterpart). Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts together constitute one instrument. Section 9.09. Subordination. (a) As among the Trustees, and as between the Liquidity Providers and the Policy Provider, on the one hand, and the Trustees and the Certificateholders, on the other hand, this Agreement shall be a subordination agreement for purposes of Section 510 of the United States Bankruptcy Code, as amended from time to time. In addition, as among the Trustees and the Certificateholders of each Class, this Agreement shall be a subordination agreement for purposes of such Section 510. (b) Notwithstanding the provisions of this Agreement, if prior to the payment in full to (i) the Liquidity Providers of all Liquidity Obligations then due and payable and (ii) the Policy Provider of all Policy Provider Obligations or prior to the distribution in full of any other amount distributable hereunder, 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, the Policy Provider or the Subordination Agent receives any payment in respect of any obligations owing or amounts distributable hereunder (or, in the case of the Liquidity Providers or the Policy Provider, in respect of the Liquidity Obligations or the Policy Provider Obligations, as the case may be), 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 amounts (or, in the case of the Liquidity Providers or the Policy Provider, such Liquidity Obligations or the Policy Provider Obligations, as the case may be) 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 Certificates), the Liquidity Providers, the Policy Provider and the Subordination Agent expressly confirm and agree that the payment priorities and subordination specified in Articles II and III shall apply in all circumstances, notwithstanding (x) the fact that the obligations owed to the Trustees are secured by certain assets and the Liquidity Obligations and the Policy Provider Obligations are not so secured and (y) the occurrence of a Delta Bankruptcy Event or any similar event or occurrence relating to any other Person (it being expressly agreed that the payment priorities and subordination specified in Articles II and III shall apply whether or not a claim for post-petition or post-filing interest is allowed in the proceedings resulting from such Delta Bankruptcy Event or other event or occurrence). The Trustees expressly agree (on behalf of themselves and the holders of Certificates) not to assert priority over the holders of Liquidity Obligations or Policy Provider Obligations (or other obligations due to the Policy Provider hereunder) due to their status as secured creditors in any bankruptcy, insolvency or other legal proceeding. (e) Each of the Trustees (on behalf of themselves and the holders of Certificates), the Liquidity Providers, the Policy Provider 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 and the Policy Provider, the Liquidity Obligations or the Policy Provider Obligations, as the case may be; (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 and the Policy Provider, any of the Liquidity Obligations or the Policy Provider Obligations, as the case may be; (iii) renew, extend, increase, alter or exchange any amounts owing to it hereunder, including, in the case of the Liquidity Providers and the Policy Provider, any of the Liquidity Obligations or the Policy Provider Obligations, as the case may be, or release or compromise any obligation of any obligor with respect thereto; (iv) refrain from exercising any right or remedy, or delay in exercising any 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; provided, however, that the taking of any such actions by any of the Trustees, the Liquidity Providers, the Policy Provider or the Subordination Agent shall not prejudice the rights or adversely affect the obligations of any other party under this Agreement. Section 9.10. Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 9.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity. (a) Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Agreements hereby (i) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (ii) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. (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. (c) Each Liquidity Provider hereby waives any immunity it may have from the jurisdiction of the courts of the United States or of any state thereof and waives any immunity any of its properties located in the United States may have from attachment or execution upon a judgment entered by any such court under the United States Foreign Sovereign Immunities Act of 1976 or any similar successor legislation. Section 9.12. Non-Petition. Each Liquidity Provider covenants that (i) until one year and one day after the Series G-1 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-1 Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-1 Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-1 Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-1 Trust, (ii) until one year and one day after the Series G-2 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-2 Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-2 Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-2 Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-2 Trust, (iii) until one year and one day after the Series C Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class C Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class C Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class C Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class C Trust and (iv) until one year and one day after the Series D Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class D Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class D Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class D Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class D Trust. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers thereunto duly authorized, as of the date first above written. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Trustee for each of the Trusts By: ____________________________________ Name: Title: WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Class G-1 Liquidity Provider, Class G-2 Liquidity Provider and Class C Liquidity Provider By: ____________________________________ Name: Title: By: ____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By: ____________________________________ Name: Title: MBIA INSURANCE CORPORATION, as Policy Provider By: ____________________________________ Name: Title: EX-4.(C)(1) 7 de763576-ex4c1.txt REVOLVING CREDIT AGMT Exhibit 4(c)(1) REVOLVING CREDIT AGREEMENT (2002-1G-1) Dated as of April 30, 2002 between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as agent and trustee for the trustee of Delta Air Lines Pass Through Trust 2002-1G-1, as Borrower and WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH as Liquidity Provider Delta Air Lines Pass Through Trust 2002-1G-1 6.718% Delta Air Lines Pass Through Certificates, Series 2002-1G-1 TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 1.01. Definitions................................................... ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT Section 2.01. The Advances.................................................. Section 2.02. Making of Advances............................................ Section 2.03. Fees.......................................................... Section 2.04. Reduction or Termination of the Maximum Commitment............ Section 2.05. Repayments of Interest Advances or the Final Advance.......... Section 2.06. Repayments of Provider Advances............................... Section 2.07. Payments to the Liquidity Provider Under the Intercreditor Agreement................................................... Section 2.08. Book Entries.................................................. Section 2.09. Payments from Available Funds Only............................ Section 2.10. Extension of the Expiry Date; Non-Extension Advance........... ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs............................................... Section 3.02. [Intentionally omitted.]...................................... Section 3.03. Withholding Taxes............................................. Section 3.04. Payments...................................................... Section 3.05. Computations.................................................. Section 3.06. Payment on Non-Business Days.................................. Section 3.07. Interest...................................................... Section 3.08. Replacement of Borrower....................................... Section 3.09. Funding Loss Indemnification.................................. Section 3.10. Illegality.................................................... ARTICLE IV CONDITIONS PRECEDENT Section 4.01. Conditions Precedent to Effectiveness of Section 2.01......... Section 4.02. Conditions Precedent to Borrowing............................. ARTICLE V COVENANTS Section 5.01. Affirmative Covenants of the Borrower......................... Section 5.02. Negative Covenants of the Borrower............................ ARTICLE VI LIQUIDITY EVENTS OF DEFAULT Section 6.01. Liquidity Events of Default................................... ARTICLE VII MISCELLANEOUS Section 7.01. No Oral Modifications or Continuing Waivers................... Section 7.02. Notices....................................................... Section 7.03. No Waiver; Remedies........................................... Section 7.04. Further Assurances............................................ Section 7.05. Indemnification; Survival of Certain Provisions............... Section 7.06. Liability of the Liquidity Provider........................... Section 7.07. Certain Costs and Expenses.................................... Section 7.08. Binding Effect; Participations................................ Section 7.09. Severability.................................................. Section 7.10. Governing Law................................................. Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity.................................................... Section 7.12. Counterparts.................................................. Section 7.13. Entirety...................................................... Section 7.14. Headings...................................................... Section 7.15. Liquidity Provider's Obligation to Make Advances.............. Annex I - Interest Advance Notice of Borrowing Annex II - Non-Extension Advance Notice of Borrowing Annex III - Downgrade Advance Notice of Borrowing Annex IV - Final Advance Notice of Borrowing Annex V - Notice of Termination Annex VI - Notice of Replacement Subordination Agent REVOLVING CREDIT AGREEMENT This REVOLVING CREDIT AGREEMENT, dated as of April 30, 2002, is made by and between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Subordination Agent (such term and other capitalized terms used herein without definition being defined as provided in Article I) under the Intercreditor Agreement (as defined below), as agent and trustee for the Class G-1 Trustee (in such capacity, together with its successors in such capacity, the "Borrower"), and WESTDEUTSCHE LANDESBANK GIROZENTRALE, a German banking institution organized under the laws of the State of North Rhine-Westphalia ("WestLB"), acting through its New York Branch (the "Liquidity Provider"). W I T N E S S E T H: WHEREAS, pursuant to the Class G-1 Trust Agreement, the Class G-1 Trust is issuing the Class G-1 Certificates; and WHEREAS, the Borrower, in order to support the timely payment of a portion of the interest on the Class G-1 Certificates in accordance with their terms, has requested the 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 mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions(a) The definitions stated herein apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Annexes" and other subdivisions are to the designated Article, Section, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) 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, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, it shall be deemed to be followed by the phrase "without limitation". (e) For the purposes of this Agreement, unless the context otherwise requires, the following capitalized terms shall have the following meanings: "Advance" means an Interest Advance, a Final Advance, a Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the case may be. "Agreement" means this Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Applicable Liquidity Rate" has the meaning specified in Section 3.07(g). "Applicable Margin" means with respect to any Unpaid Advance or Applied Provider Advance, 2.00% per annum. "Applied Downgrade Advance" has the meaning specified in Section 2.06(a). "Applied Non-Extension Advance" has the meaning specified in Section 2.06(a). "Applied Provider Advance" means an Applied Downgrade Advance or an Applied Non-Extension Advance. "Base Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 each day in the period for which the Base Rate is to be determined (or, if such day is not a Business Day, for the 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 (and reasonably satisfactory to Delta) plus one-quarter of one percent (0.25%). "Base Rate Advance" means an Advance that bears interest at a rate based upon the Base Rate. "Borrower" has the meaning specified in the introductory paragraph 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, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia, or, so long as any Class G-1 Certificate is outstanding, the city and state in which the Class G-1 Trustee, the Borrower or any related Loan Trustee maintains its Corporate Trust Office or receives or disburses funds, and, if the applicable Business Day relates to any Advance or other amount bearing interest based on the LIBOR Rate, on which dealings are carried on in the London interbank market. "Consent Notice" has the meaning specified in Section 2.10. "Consent Period" has the meaning specified in Section 2.10. "Covered Taxes" means any Taxes imposed by the United States or any political subdivision or taxing authority thereof or therein required by law to be deducted or withheld from any amounts payable to the Liquidity Provider under this Agreement other than (i) any Tax on, based on or measured by net income, franchises or conduct of business, (ii) any Tax imposed, levied, withheld or assessed as a result of any connection between the Liquidity Provider and the United States or such political subdivision or taxing authority, other than a connection arising solely from the Liquidity Provider's having executed, delivered, performed its obligations or received a payment under, or enforced, any Operative Agreement, (iii) any Tax attributable to the inaccuracy in or breach by the Liquidity Provider of any of its representations, warranties or covenants contained in any Operative Agreement to which it is a party or the inaccuracy of any form or document furnished pursuant thereto, (iv) any withholding Taxes imposed by the United States except to the extent such withholding Taxes would not have been required to be deducted or withheld from payments hereunder but for a change after the date hereof (or in the case of a successor Liquidity Provider (including a transferee of an Advance) after the date on which such successor Liquidity Provider obtains its interest) 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 other than the applicable income tax treaty between the United States of America and the Federal Republic of Germany ("German Treaty") (except an addition to, or change in any "anti-treaty shopping", "limitation of benefits" or similar provision in such German Treaty)), (v) 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, or (vi) any change in the Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "Downgrade Advance" means an Advance made pursuant to Section 2.02(c). "Effective Date" has the meaning specified in Section 4.01. The delivery of the certificate of the Liquidity Provider contemplated by Section 4.01(f) shall be conclusive evidence that the Effective Date has occurred. "Expenses" means liabilities, losses, damages, costs and expenses (including, without limitation, reasonable fees and disbursements of legal counsel), provided that Expenses shall not include any Taxes other than sales, use and V.A.T. taxes imposed on fees and expenses payable pursuant to Section 7.07. "Expiry Date" means April 28, 2003, initially, or any date to which the Expiry Date is extended pursuant to Section 2.10. "Final Advance" means an Advance made pursuant to Section 2.02(d). "Increased Cost" has the meaning specified in Section 3.01. "Intercreditor Agreement" means the Intercreditor Agreement, dated as of the date hereof, among the Trustees, the Liquidity Provider, the liquidity provider under each Liquidity Facility (other than this Agreement), the Policy Provider and the Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interest Advance" means an Advance made pursuant to Section 2.02(a). "Interest Period" means, with respect to any LIBOR Advance, each of the following periods: (i) the period beginning on the third Business Day following either (A) the Liquidity Provider's receipt of the Notice of Borrowing for such LIBOR Advance or (B) the date of the withdrawal of funds from the Class G-1 Cash Collateral Account for the purpose of paying interest on the Class G-1 Certificates as contemplated by Section 2.06(a) hereof and, in each case, ending on the next numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; and (ii) each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; provided, however, that if (x) the Final Advance shall have been made pursuant to Section 2.02(d) or (y) other outstanding Advances shall have been converted into the Final Advance pursuant to Section 6.01, then the Interest Periods shall be successive periods of one month beginning on the third 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 following such conversion (in the case of clause (y) above). "Lending Office" means the lending office of the Liquidity Provider presently located at New York, New York, or such other lending office as the Liquidity Provider from time to time shall notify the Borrower as its lending office hereunder; provided that the Liquidity Provider shall not change its Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "LIBOR Advance" means an Advance bearing interest at a rate based upon the LIBOR Rate. "LIBOR Rate" means, with respect to any Interest Period, (a) the interest rate per annum equal to the rate per annum at which deposits in Dollars are offered in the London interbank market as shown on Page 3750 of the Telerate Systems Incorporated screen service (or such other page as may replace Telerate Page 3750), or if such service is not available, Page LIBO of the Reuters Money Service Monitor System (or such other page as may replace Reuters Page LIBO) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period, for a period comparable to such Interest Period, or (b) if no such rate is published on either such service or if neither of such services is then available, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the London interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (c) if none of the Reference Banks is quoting a rate for deposits in Dollars in the London interbank market for such a period and amount, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the principal New York offices of the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (New York time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the New York interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (d) if none of the principal New York offices of the Reference Banks is quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, the Base Rate. "Liquidity Event of Default" means the occurrence of either (a) the Acceleration of all of the Equipment Notes or (b) a Delta Bankruptcy Event. "Liquidity Indemnitee" means the Liquidity Provider, its directors, officers, employees and agents, and its successors and permitted assigns. "Liquidity Provider" has the meaning specified in the introductory paragraph 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 or a Final Advance, the Maximum Available Commitment shall be zero. "Maximum Commitment" means initially $65,931,269.73, as the same may be reduced from time to time in accordance with Section 2.04(a). "Non-Extension Advance" means an Advance made pursuant to Section 2.02(b). "Notice of Borrowing" has the meaning specified in Section 2.02(e). "Notice of Replacement Subordination Agent" has the meaning specified in Section 3.08. "Participation" has the meaning specified in Section 7.08(b). "Performing Note Deficiency" means any time that less than 65% of the then aggregate outstanding principal amount of all Equipment Notes are Performing Equipment Notes. "Permitted Transferee" means any Person that: (a) is not a commercial air carrier, Delta or any affiliate of Delta; and (b) is any one of: (1) a commercial banking institution organized under the laws of the United States or any state thereof or the District of Columbia; (2) a commercial banking institution that (x) is organized under the laws of France, Germany, The Netherlands, Switzerland or the United Kingdom, (y) is entitled on the date it acquires any Participation to a complete exemption from United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under an income tax treaty, as in effect on such date, between the United States and such jurisdiction of its organization and (z) is engaged in the active conduct of a banking business in such jurisdiction of its organization, holds its Participation in connection with such banking business in such jurisdiction and is regulated as a commercial banking institution by the appropriate regulatory authorities in such jurisdiction; or (3) a commercial banking institution that (x) is organized under the laws of Canada, France, Germany, Ireland, Japan, Luxembourg, The Netherlands, Sweden, Switzerland or the United Kingdom and (y) is entitled on the date it acquires any Participation to a complete exemption from withholding of United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under laws as in effect on such date by reason of such income being effectively connected with the conduct of a trade or business within the United States. "Prospectus Supplement" means the Prospectus Supplement dated April 23, 2002, relating to the Certificates, as such Prospectus Supplement may be amended or supplemented. "Provider Advance" means a Downgrade Advance or a Non-Extension Advance. "Reference Banks" means the principal London offices of: National Westminster Bank, plc; WestLB; J.P. Morgan Chase Bank; Citibank, N.A.; and such other or additional banking institutions as may be designated from time to time by mutual agreement of Delta and the Liquidity Provider. "Regulatory Change" means the enactment, adoption or promulgation, after the date of this Agreement, of any law or regulation by a United States federal or state government or by the government of the Liquidity Provider's jurisdiction of organization, or any change, after the date of this Agreement, in any such law or regulation, or in the interpretation thereof by any governmental authority, central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization charged with responsibility for the administration or application thereof, that shall impose, modify or deem applicable: (a) any reserve, special deposit or similar requirement against extensions of credit or other assets of, or deposits with or other liabilities of, the Liquidity Provider including, or by reason of, the Advances, or (b) any capital adequacy requirement requiring the maintenance by the Liquidity Provider of additional capital in respect of any Advances or the Liquidity Provider's obligation to make any such Advances. "Replenishment Amount" has the meaning specified in Section 2.06(b). "Required Amount" means, for any day, the sum of the aggregate amount of interest, calculated at the rate per annum equal to the Stated Interest Rate for the Class G-1 Certificates on the basis of a 360-day year comprised of twelve 30-day months, that would be payable on the Class G-1 Certificates on each of the three successive semiannual Regular Distribution Dates immediately following such day or, if such day is a Regular Distribution Date, on such day and the succeeding two semiannual Regular Distribution Dates, in each case calculated on the basis of the Pool Balance of the Class G-1 Certificates on such day and without regard to expected future distributions of principal on the Class G-1 Certificates. Notwithstanding the above, in the event of a Policy Provider Election with respect to a Series G-1 Equipment Note, the Pool Balance, for purposes of this definition, shall be deemed to be reduced by an amount (if positive) by which (a) the then outstanding principal balance of such Series G-1 Equipment Note shall exceed (b) the amount of any policy drawings previously paid by the Policy Provider in respect of principal on such Series G-1 Equipment Note. "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 G-1 Certificates have been paid in full (or provision has been made for such payment in accordance with the Intercreditor Agreement and the Class G-1 Trust Agreement) 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 3.06(e) of the Intercreditor Agreement; (iv) the fifth Business Day following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01; 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. "Unapplied Provider Advance" means any Provider Advance other than an Applied Provider Advance. "Unpaid Advance" has the meaning specified in Section 2.05. "Withdrawal Notice" has the meaning specified in Section 2.10. For the purposes of this Agreement, the following terms shall have the respective meanings specified in the Intercreditor Agreement: "Acceleration", "Certificate", "Class C Certificates", "Class D Certificates", "Class G-1 Cash Collateral Account", "Class G-1 Certificates", "Class G-1 Certificateholders", "Class G-1 Trust", "Class G-1 Trust Agreement", "Class G-1 Trustee", "Class G-2 Certificates", "Closing Date", "Collection Account", "Controlling Party", "Corporate Trust Office", "Delta", "Delta Bankruptcy Event", "Distribution Date", "Dollars", "Downgraded Facility", "Equipment Notes", "Fee Letter", "Final Legal Distribution Date", "Indenture", "Initial Class D Holder", "Interest Payment Date", "Investment Earnings", "Liquidity Facility", "Liquidity Obligations", "Loan Trustee", "Moody's", "Non-Extended Facility", "Operative Agreements", "Participation Agreements", "Performing Equipment Note", "Person", "Policy", "Policy Provider", "Policy Provider Election", "Pool Balance", "Rating Agencies", "Ratings Confirmation", "Regular Distribution Date", "Replacement Liquidity Facility", "Responsible Officer", "Scheduled Payment", "Special Payment", "S&P", "Stated Interest Rate", "Subordination Agent", "Taxes", "Threshold Rating", "Trust Agreement", "Trustee", "Underwriters", "Underwriting Agreement", "United States" and "Written Notice". 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 12:00 noon (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 of Advances. (a) Each Interest Advance shall be made by the Liquidity Provider upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex I, signed by a Responsible Officer of the Borrower, such Interest Advance to be in an amount not exceeding the Maximum Available Commitment at such time and used solely for the payment when due of interest with respect to the Class G-1 Certificates at the Stated Interest Rate therefor in accordance with Section 3.06(a) and 3.06(b) 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 or in part 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 an amount equal to the amount of such Interest Advance so repaid, but not to exceed the Maximum Commitment; provided, however, that the Maximum Available Commitment shall not be so reinstated at any time if (x) both a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing or (y) a Final Drawing shall have occurred. (b) Subject to Section 2.10, a Non-Extension Advance shall be made by the Liquidity Provider if this Agreement is not extended in accordance with Section 3.06(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 3.06(d) within the time period specified in such Section 3.06(d)) upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex II, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-1 Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement. (c) A Downgrade Advance shall be made by the Liquidity Provider if at any time the short-term unsecured debt rating (in the case of Moody's) or short-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by Moody's or S&P, respectively, (or if the Liquidity Provider does not have a short-term unsecured debt rating or short-term corporate credit rating, as applicable, issued by a given Rating Agency, the long-term unsecured debt rating (in the case of Moody's) or long-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by such Rating Agency) is lower than the applicable Threshold Rating (as provided for in Section 3.06(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 3.06(c), upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex III, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-1 Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement. (d) A Final Advance shall be made by the Liquidity Provider following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01 upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex IV, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-1 Cash Collateral Account (in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement). (e) Each Borrowing shall be made on notice in writing (a "Notice of Borrowing") in substantially the form required by Section 2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the Borrower to the 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 Dollars and immediately available funds, before 4:00 p.m. (New York City time) on such Business Day or before 1:00 p.m. (New York City time) on such later Business Day specified in such Notice of Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect of any Borrowing 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 Dollars and immediately available funds, before 1:00 p.m. (New York City time) on the first Business Day next following the day of receipt of such Notice of Borrowing or on such later Business Day specified by the Borrower in such Notice of Borrowing. Payments of proceeds of a Borrowing shall be made by wire transfer of immediately available funds to the Borrower in accordance with such wire transfer instructions as the Borrower shall furnish from time to time to the Liquidity Provider for such purpose. Each Notice of Borrowing shall be irrevocable and binding on the Borrower. Each Notice of Borrowing shall be effective upon delivery of a copy thereof to the Liquidity Provider's New York branch at the address specified in Section 7.02 hereof. (f) Upon the making of any Advance requested pursuant to a Notice of Borrowing in accordance with the Borrower's payment instructions, the 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 (including the Trustee or any Class G-1 Certificateholder). 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 said 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), 2.02(c) or 2.02(d) to fund the Class G-1 Cash Collateral Account, the Liquidity Provider shall have no interest in or rights to the Class G-1 Cash Collateral Account, such Advance or any other amounts from time to time on deposit in the Class G-1 Cash Collateral Account; provided that the foregoing shall not affect or impair the obligations of the Subordination Agent to make the distributions contemplated by Section 3.06(e) or 3.06(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 G-1 Cash Collateral Account to the extent provided in Section 2.02(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. Section 2.03. Fees. The Borrower agrees to pay to the Liquidity Provider the fees set forth in the Fee Letter. Section 2.04. Reduction or Termination of the Maximum Commitment. (a) Automatic Reduction. Promptly following each date on which the Required Amount is reduced as a result of a reduction in the Pool Balance of the Class G-1 Certificates or otherwise (including upon any Policy Provider Election with respect to a Series G-1 Equipment Note), the Maximum Commitment shall automatically be reduced to an amount equal to such reduced Required Amount (as calculated by the Borrower). The Borrower shall give notice of any such automatic reduction of the Maximum Commitment to the Liquidity Provider and Delta within two Business Days thereof. The failure by the Borrower to furnish any such notice shall not affect such automatic reduction of the Maximum Commitment. (b) Termination. Upon the making of any Provider Advance or Final Advance hereunder or the occurrence of the Termination Date, the obligation of the Liquidity Provider to make further Advances hereunder shall automatically and irrevocably terminate, and the Borrower shall not be entitled to request any further Borrowing hereunder. Section 2.05. Repayments of Interest Advances or the Final Advance. Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees, without notice of an Advance or demand for repayment from the Liquidity Provider (which notice and demand are hereby waived by the Borrower), to pay, or to cause to be paid, to the Liquidity Provider (a) on each date on which the Liquidity Provider shall make an Interest Advance or the Final Advance, an amount equal to the amount of such Advance (any such Advance, until repaid, is referred to herein as an "Unpaid Advance"), plus (b) interest on the amount of each such Unpaid Advance in the amounts and on the dates determined as provided in Section 3.07; 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)). The Borrower and the Liquidity Provider agree that the repayment in full of each Interest Advance and Final Advance on the date such Advance is made is intended to be a contemporaneous exchange for new value given to the Borrower by the Liquidity Provider. For the avoidance of doubt, interest payable on an Interest Advance or the Final Advance shall not be regarded as overdue unless such interest is not paid when due under Section 3.07. Section 2.06. Repayments of Provider Advances. (a) Amounts advanced hereunder in respect of a Provider Advance shall be deposited in the Class G-1 Cash Collateral Account and invested and withdrawn from the Class G-1 Cash Collateral Account as set forth in Sections 3.06(c), 3.06(d), 3.06(e) and 3.06(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, in the amounts determined as provided in Section 3.07; provided, however, that amounts in respect of a Provider Advance withdrawn from the Class G-1 Cash Collateral Account for the purpose of paying interest on the Class G-1 Certificates in accordance with Section 3.06(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, such Provider Advance shall thereafter be treated as a Final Advance under this Agreement for purposes of determining the Applicable Liquidity Rate for interest payable thereon and the dates on which such interest is payable. Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal of any amounts from the Class G-1 Cash Collateral Account on account of a reduction in the Required Amount, the Borrower shall repay to the Liquidity Provider a portion of the Provider Advances in a principal amount equal to such reduction, plus interest on the principal amount prepaid as provided in Section 3.07. (b) At any time when an Applied Provider Advance (or any portion thereof) is outstanding, upon the deposit in the Class G-1 Cash Collateral Account of any amount pursuant to clause "third" of Section 2.04(b) of the Intercreditor Agreement, clause "third" of Section 3.02 of the Intercreditor Agreement or clause "fourth" of Section 3.03 of the Intercreditor Agreement (any such amount being a "Replenishment Amount") for the purpose of replenishing or increasing the balance thereof up to the Required Amount at such time, (i) the aggregate outstanding principal amount of all Applied Provider Advances (and of Provider Advances treated as an Interest Advance for purposes of determining the Applicable Liquidity Rate for interest payable thereon) shall be automatically reduced by the amount of such Replenishment Amount, and (ii) the aggregate outstanding principal amount of all Unapplied Provider Advances shall be automatically increased by the amount of such Replenishment Amount. (c) Upon the provision of a Replacement Liquidity Facility in replacement of this Agreement in accordance with Section 3.06(e) of the Intercreditor Agreement, as provided in Section 3.06(f) of the Intercreditor Agreement, amounts remaining on deposit in the Class G-1 Cash Collateral Account after giving effect to any Applied Provider Advance on the date of such replacement shall be reimbursed to the Liquidity Provider, but only to the extent such amounts are necessary to repay in full to the 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 3.06(f) of the Intercreditor Agreement), shall be paid to the Liquidity Provider in accordance with the terms thereof (but, for the avoidance of doubt, without duplication of or increase in any amounts payable hereunder). Amounts so paid to the Liquidity Provider shall be applied by the Liquidity Provider in the order of priority required by the applicable provisions of Articles II and III of the Intercreditor Agreement and shall discharge in full the corresponding obligations of the Borrower hereunder. 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 shall be made only from the amounts that constitute Scheduled Payments, Special Payments and other payments under the Operative Agreements, including payment under Section 4.02 of the Participation Agreements and payments under Section 2.14 of the Indentures, 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 to the extent available for distribution to it as provided in the Intercreditor Agreement and this Agreement and that the Borrower, in its individual capacity, is not personally liable to it for any amounts payable or liability under this Agreement except as expressly provided in this Agreement, the Intercreditor Agreement or any Participation Agreement. Amounts on deposit in the Class G-1 Cash Collateral Account shall be available to the Borrower to make payments under this Agreement only to the extent and for the purposes expressly contemplated in Section 3.06(f) of the Intercreditor Agreement. Section 2.10. Extension of the Expiry Date; Non-Extension Advance. If the Expiry Date is prior to the date that is 15 days after the Final Legal Distribution Date for the Class G-1 Certificates, then no earlier than the 60th day and no later than the 40th day prior to the then applicable Expiry Date, the Borrower may request in writing 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 G-1 Certificates and (ii) the date that is the day immediately preceding the 364th day after the last day of the Consent Period (unless the obligations of the Liquidity Provider hereunder are earlier terminated in accordance herewith). The Liquidity Provider shall by notice (the "Consent Notice") to the Borrower during the period commencing on the date that is 60 days prior to the then effective Expiry Date and ending on the date that is 25 days prior to the then effective Expiry Date (the "Consent Period") advise the Borrower whether, in its sole discretion, it agrees to so extend the Expiry Date; provided, however, that such extension shall not be effective with respect to the Liquidity Provider if, by notice (the "Withdrawal Notice") to the Borrower prior to the end of the Consent Period, the Liquidity Provider revokes its Consent Notice. If the Liquidity Provider advises the Borrower in the Consent Notice that such Expiry Date shall not be so extended, or gives a Withdrawal Notice to the Borrower prior to the end of the Consent Period, or fails to irrevocably and unconditionally advise the Borrower on or before the end of the Consent Period 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 3.06(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 3.06(d) of the Intercreditor Agreement. If any amounts shall be drawn pursuant to a Non-Extension Advance and, within 30 days thereafter, the Liquidity Provider shall not have been replaced, then at any time following the 30th day after such Non-Extension Advance, the Liquidity Provider may, by written notice to the Borrower, agree to reinstate the Liquidity Facility on the terms of the existing Liquidity Facility for a period ending on the 364th day after the end of the Consent Period; provided, however, that in such event the Liquidity Provider shall reimburse the Borrower for any costs actually incurred by or on behalf of the Borrower in drawing pursuant to the Non-Extension Advance and funding the Class G-1 Cash Collateral Account or otherwise in connection with the Non-Extension Advance. ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs. If as a result of any Regulatory Change there shall be any increase by an amount reasonably deemed by the Liquidity Provider to be material in the actual cost to the Liquidity Provider of making, funding or maintaining any Advances or its obligation to make any such Advances or there shall be any reduction by an amount reasonably deemed by the Liquidity Provider to be material in the amount receivable by the Liquidity Provider under this Agreement or the Intercreditor Agreement in respect thereof, and in case of either such an increase or reduction, such event does not arise from the gross negligence or willful misconduct of the Liquidity Provider, from its breach of any of its representations, warranties, covenants or agreements contained herein or in the Intercreditor Agreement or from its failure to comply with any such Regulatory Change (any such increase or reduction being referred to herein as an "Increased Cost"), then the Borrower shall from time to time pay to the Liquidity Provider an amount equal to such Increased Cost within 15 Business Days after delivery to the Borrower and Delta of a certificate of an officer of the Liquidity Provider describing in reasonable detail the event by reason of which it claims such Increased Cost and the basis for the determination of the amount of such Increased Cost; provided that, the Borrower shall be obligated to pay amounts only with respect to any Increased Costs accruing from the date 45 days prior to the date of delivery of such certificate. Such certificate, in the absence of manifest error, shall be considered prima facie evidence of the amount of the Increased Costs for purposes of this Agreement; provided that any determinations and allocations by the Liquidity Provider of the effect of any Regulatory Change on the costs of maintaining the Advances are made on a reasonable basis. The Liquidity Provider shall not be entitled to assert any claim under this Section 3.01 in respect of or attributable to Taxes. The Liquidity Provider will notify the Borrower and Delta as promptly as practicable of any event occurring after the date of this Agreement that will entitle the Liquidity Provider to compensation under this Section 3.01. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for reducing any Increased Costs and to use all commercially reasonable efforts (consistent with applicable legal and regulatory restrictions) to avoid or minimize, to the greatest extent possible, any claim in respect of Increased Costs, including, without limitation, by designating a different Lending Office, if such designation or other action would avoid the need for, or reduce the amount of, any such claim; provided that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for any claim in respect of Increased Costs, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. Notwithstanding the foregoing provisions, in no event shall the Borrower be required to make payments under this Section 3.01: (a) in respect of any Regulatory Change proposed by any applicable governmental authority (including any branch of a legislature), central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization and pending as of the date of this Agreement (it being agreed that the consultative paper issued by the Basel Committee on Banking Supervision entitled "The New Basel Capital Accord", dated January 2001, shall not be considered to have been proposed or pending as of the date of this Agreement); (b) if a claim hereunder in respect of an Increased Cost arises through circumstances peculiar to the Liquidity Provider and that do not affect similarly organized commercial banking institutions in the same jurisdiction generally that are in compliance with the law, rule, regulation or interpretation giving rise to the Regulatory Change relating to such Increased Cost; (c) if the Liquidity Provider shall fail to comply with its obligations under this Section 3.01; or (d) if the Liquidity Provider is not also seeking payment for similar increased costs in other similarly situated transactions. Section 3.02. [Intentionally omitted.] Section 3.03. Withholding Taxes. (a) All payments made by the Borrower under this Agreement shall be made without deduction or withholding for or on account of any Taxes, unless such deduction or withholding is required by law. If any Taxes are so required to be withheld or deducted from any amounts payable to the Liquidity Provider under this Agreement, the Borrower shall pay to the relevant authorities the full amount so required to be deducted or withheld and, if such Taxes are Covered Taxes, pay to the Liquidity Provider such additional amounts as shall be necessary to ensure that the net amount actually received by the Liquidity Provider (after deduction or withholding of all Covered Taxes) shall be equal to the full amount that would have been received by the Liquidity Provider had no withholding or deduction of Covered Taxes been required. The Liquidity Provider agrees to use reasonable efforts (consistent with applicable legal and regulatory restrictions) to change the jurisdiction of its Lending 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 materially disadvantageous to the Liquidity Provider. If the Liquidity Provider receives a refund of, or realizes a net Tax benefit not otherwise available to it as a result of, any Taxes for which additional amounts were paid by the Borrower pursuant to this Section 3.03, the Liquidity Provider shall pay to the Borrower (for deposit into the Collection Account) the amount of such refund (and any interest thereon) or net benefit. The Liquidity Provider will (i) provide (on its behalf and on behalf of any participant holding a Participation pursuant to Section 7.08) to the Borrower (x) on or prior to the Effective Date two valid completed and executed copies of Internal Revenue Service Form W8-BEN or W8-EC1 (whichever is applicable), including thereon a valid U.S. taxpayer identification number (or, with respect to any such participant, such other form or documentation as may be applicable) covering all amounts receivable by it in connection with the transactions contemplated by the Operative Agreements and (y) thereafter from time to time such additional forms or documentation as may be necessary to establish an available exemption from withholding of United States Tax on payments hereunder so that such forms or documentation are effective for all periods during which it is the Liquidity Provider and (ii) provide timely notice to the Borrower if any such form or documentation is or becomes inaccurate. The Liquidity Provider shall deliver to the Borrower such other forms or documents as may be reasonably requested by the Borrower or required by applicable law to establish that payments hereunder are exempt from or entitled to a reduced rate of Covered Taxes. (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 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. If any exemption from, or reduction in the rate of, any Taxes required to be borne by the Liquidity Provider under this Section 3.03(b) is reasonably available to the Borrower without providing any information regarding the holders or beneficial owners of the Certificates, the Borrower shall deliver the Liquidity Provider such form or forms and such other evidence of the eligibility of the Borrower for such exemption or reductions (but without any requirement to provide any information regarding the holders or beneficial owners of the Certificates) 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, such 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 Dollars, to the Liquidity Provider in immediately available funds, by wire transfer to J.P. Morgan Chase Bank, 021-000021 in favor of account number 9201060663, Westdeutsche Landesbank New York Branch, Reference: Delta EETC 2002-1, G-1 LF. Section 3.05. Computations. All computations of interest based on the Base Rate shall be made on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the LIBOR Rate shall be made on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable. Section 3.06. Payment on Non-Business Days. Whenever any payment to be made hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and no additional interest shall be due as a result (and if so made, shall be deemed to have been made when due). If any payment in respect of interest on an Advance is so deferred to the next succeeding Business Day, such deferral shall not delay the commencement of the next Interest Period for such Advance (if such Advance is a LIBOR Advance) or reduce the number of days for which interest will be payable on such Advance on the next interest payment date for such Advance. Section 3.07. Interest. (a) Subject to Sections 2.07 and 2.09, the Borrower shall pay, or shall cause to be paid, without duplication, interest on (i) the unpaid principal amount of each Advance from and including the date of such Advance (or, in the case of an Applied Provider Advance, from and including the date on which the amount thereof was withdrawn from the Class G-1 Cash Collateral Account to pay interest on the Class G-1 Certificates) to but excluding the date such principal amount shall be paid in full (or, in the case of an Applied Provider Advance, the date on which the Class G-1 Cash Collateral Account is fully replenished in respect of such Advance) and (ii) any other amount due hereunder (whether fees, commissions, expenses or other amounts or, to the extent permitted by law, installments of interest on Advances or any such other amount) that 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 the interest rate per annum for each day equal to the Applicable Liquidity Rate (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 to the maximum extent permitted by applicable law 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 absolute amount of interest that would have accrued (without additional interest thereon) if such otherwise applicable interest rate as set forth in this Section 3.07 had at all relevant times been in effect. Nothing contained in this Section 3.07 shall require the Borrower to pay any amount under this Section 3.07 other than to the extent the Borrower shall have funds available therefor. (b) Except as provided in Section 3.07(e), each Advance will be either a Base Rate Advance or a LIBOR Advance as provided in this Section 3.07. Each such Advance will be a Base Rate Advance for the period from the date of its borrowing to (but excluding) the third Business Day following the 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, pursuant to Section 2.06, such Final Advance is deemed to have been made without delivery of a Notice of Borrowing, by requesting, prior to 11:00 a.m. 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 Provider Advance shall bear interest in an amount equal to the Investment Earnings on amounts on deposit in the Class G-1 Cash Collateral Account for such Unapplied Provider Advance on the amount of such Unapplied Provider 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. (g) Each change in the Base Rate shall become effective immediately. The rates of interest specified in this Section 3.07 with respect to any Advance or other amount shall be referred to as the "Applicable Liquidity Rate". Section 3.08. Replacement of Borrower. Subject to Section 5.02, from time to time and subject to the successor Borrower's meeting the eligibility requirements set forth in Section 6.09 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 (a "Notice of Replacement Subordination Agent") delivered to the Liquidity Provider by the then Borrower, the successor Borrower designated therein shall become 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 the Applicable Margin or anticipated profits) incurred as a result of: (1) Any repayment of a LIBOR Advance on a date other than the last day of the Interest Period for such Advance; or (2) Any failure by the Borrower to borrow a LIBOR Advance on the date for borrowing specified in the relevant notice under Section 2.02. Section 3.10. Illegality. Notwithstanding any other provision in this Agreement, if any change in any law, rule or regulation applicable to or binding on the Liquidity Provider, 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 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 to maintain or fund its LIBOR Advances, then upon notice to the Borrower and Delta 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 reasonable judgment of the Liquidity Provider, requires immediate conversion; 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 will notify the Borrower and Delta as promptly as practicable of any event that will lead to the conversion of LIBOR Advances to Base Rate Advances under this Section 3.10. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for avoiding the need for such conversion, including, without limitation, designating a different Lending Office, if such designation or other action would avoid the need to convert such LIBOR Advances to Base Rate Advances; provided, that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for conversion of the LIBOR Advances to Base Rate Advances, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. 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 by the appropriate party or parties): (a) The Liquidity Provider shall have received on or before the Closing Date 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; (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 and the Intercreditor Agreement); (iv) A copy of the Prospectus Supplement and specimen copies of the Class G-1 Certificates; (v) An executed copy of each document, instrument, certificate and opinion delivered on or before the Closing Date pursuant to the Class G-1 Trust Agreement, the Intercreditor Agreement and the other Operative Agreements (in the case of each such opinion, 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); and (vi) An agreement from Delta, pursuant to which (x) Delta agrees to provide copies of quarterly financial statements and audited annual financial statements to the Liquidity Provider (which Delta may provide in an electronic format by electronic mail or making such available over the internet) and (y) Delta agrees to allow the Liquidity Provider to discuss the transactions contemplated by the Operative Agreements with officers and employees of Delta. (b) On and as of the Effective Date no event shall have occurred and be 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 filings referred to in Sections 3.01(d) and 3.01(f) of the Participation Agreements shall have been filed (or shall be in the process of being filed). (d) The Liquidity Provider shall have received payment in full of the fees and other sums required to be paid to or for the account of the Liquidity Provider on or prior to the Effective Date pursuant to the Fee Letter. (e) All conditions precedent to the issuance of the Certificates under the Trust Agreement shall have been satisfied or waived, all conditions precedent to the effectiveness of the other Liquidity Facilities shall have been satisfied or waived, and all conditions precedent to the purchase of the Certificates by the Underwriters under the Underwriting Agreement shall have been satisfied (unless any of such conditions precedent under the Underwriting Agreement shall have been waived by the Underwriters), and all conditions precedent to the purchase of the Class D Certificates by the Initial Class D Holder shall have been satisfied. (f) The Borrower and Delta shall have received a certificate, dated the Effective Date signed by a duly authorized representative of the Liquidity Provider, certifying that all conditions precedent specified in this Section 4.01 have been satisfied or waived by the Liquidity Provider. 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, prior to the time of such Borrowing, the Borrower shall have delivered a Notice of Borrowing which conforms to the terms and conditions of this Agreement. 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 Agreements. Punctually pay or cause to be paid all amounts payable by it under this Agreement and the Intercreditor Agreement and observe and perform in all material respects the conditions, covenants and requirements applicable to it contained in this Agreement and the Intercreditor Agreement. (b) Reporting Requirements. Furnish to the Liquidity Provider with reasonable promptness, such other information and data with respect to the transactions contemplated by the Operative Agreements as from time to time may be reasonably requested by the 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, copies of 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. Subject to the first and fourth paragraphs of Section 7.01(a) of the Intercreditor Agreement and Section 7.01(b) of the Intercreditor Agreement, 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 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) this Agreement to expire at the close of business 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 3.06(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, all Advances, 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. 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 Borrower and the Liquidity Provider and any other Person whose consent is required pursuant to this Agreement; provided that no such change or other action relating to payment terms (including timing of any payments) shall affect the payment obligations of Delta without Delta's prior written consent and any such change or other action relating to payment terms (including timing of any payments) that would adversely affect the interests of the Policy Provider shall require the consent of the Policy Provider; and any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given. Section 7.02. Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: If to the Borrower, to: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION 225 Asylum Street, Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Telecopy: (860) 244-1881 If to the Liquidity Provider, to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Transportation Finance Telephone: (212) 852-6111 Telecopy: (212) 869-7634 With a copy to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Loan Administration Telephone: (212) 852-6323 Telecopy: (212) 302-7946 Any party, by notice to the other party hereto, may designate additional or different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 7.02. 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 4.02 of the Participation Agreements. In addition, the Borrower agrees to indemnify, protect, defend and hold harmless each Liquidity Indemnitee from and against all Expenses of any kind or nature whatsoever (other than any Expenses of the nature described in Sections 3.01 or 7.07 or in the Fee Letter (regardless of whether indemnified against pursuant to said Sections or in such Fee Letter)), that may be imposed on or incurred by such 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 Participation 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 negligence or willful misconduct of such Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) an ordinary and usual operating overhead expense, (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 or any other Operative Agreement to which it is a party or (iv) otherwise excluded from the indemnification provisions contained in Section 4.02 of the Participation Agreements. The provisions of Sections 3.01, 3.03, 3.09, 7.05 and 7.07 and the indemnities contained in Section 4.02 of the Participation Agreements 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 or directors 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 that were the result of (A) the Liquidity Provider's willful misconduct or gross 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 or the Intercreditor 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 complying with the terms and conditions hereof. (b) Neither the Liquidity Provider nor any of its officers, employees or directors or affiliates shall be liable or responsible in any respect for (i) any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with this Agreement or any Notice of Borrowing delivered hereunder or (ii) any action, inaction or omission which may be taken by it in good faith, absent willful misconduct or negligence (in which event the extent of the Liquidity Provider's potential liability to the Borrower shall be limited as set forth in the immediately preceding paragraph), in connection with this Agreement or any Notice of Borrowing. Section 7.07. Certain Costs and Expenses. The Borrower agrees promptly to pay, or cause to be paid, (a) the reasonable fees, expenses and disbursements of Milbank, Tweed, Hadley & McCloy LLP, special counsel for the Liquidity Provider, in connection with the preparation, negotiation, execution, delivery, filing and recording of the Operative Agreements, any waiver or consent thereunder or any amendment thereof and (b) if a Liquidity Event of Default occurs, all out-of-pocket expenses incurred by the Liquidity Provider, including reasonable fees and disbursements of counsel, in connection with such Liquidity Event of Default and any collection, bankruptcy, insolvency and other enforcement proceedings in connection therewith. In addition, the Borrower shall pay any and all recording, stamp and other similar taxes and fees payable or determined to be payable in the United States in connection with the execution, delivery, filing and recording of this Agreement, any other Operative Agreement and such other documents, and agrees to save the 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 permitted assigns, except that neither the Liquidity Provider (except as otherwise provided in this Section 7.08) nor (except as contemplated by Section 3.08) the Borrower shall have the right to assign, pledge or otherwise transfer its rights or obligations hereunder or any interest herein, subject to the Liquidity Provider's right to grant Participations pursuant to Section 7.08(b). (b) The Liquidity Provider agrees that it will not grant any participation (including, without limitation, a "risk participation") (any such participation, a "Participation") in or to all or a portion of its rights and obligations hereunder or under the other Operative Agreements, unless all of the following conditions are satisfied: (i) such Participation is to a Permitted Transferee, (ii) such Participation is made in accordance with all applicable laws, including, without limitation, the Securities Act of 1933, as amended, the Trust Indenture Act of 1939, as amended, and any other applicable laws relating to the transfer of similar interests and (iii) such Participation shall not be made under circumstances that require registration under the Securities Act of 1933, as amended, or qualification of any indenture under the Trust Indenture Act of 1939, as amended. Notwithstanding any such Participation, the Liquidity Provider agrees that (1) the Liquidity Provider's obligations under the Operative Agreements shall remain unchanged, and such participant shall have no rights or benefits as against Delta or the Borrower or under any Operative Agreement, (2) the Liquidity Provider shall remain solely responsible to the other parties to the Operative Agreements for the performance of such obligations, (3) the Liquidity Provider shall remain the maker of any Advances, and the other parties to the Operative Agreements shall continue to deal solely and directly with the Liquidity Provider in connection with the Advances and the Liquidity Provider's rights and obligations under the Operative Agreements, (4) the Liquidity Provider shall be solely responsible for any withholding Taxes or any filing or reporting requirements relating to such Participation and shall hold the Borrower and Delta and their respective successors, permitted assigns, affiliates, agents and servants harmless against the same and (5) neither Delta nor the Borrower shall be required to pay to the Liquidity Provider any amount under Section 3.01 or Section 3.03 greater than it would have been required to pay had there not been any grant of a Participation by the Liquidity Provider. The Liquidity Provider may, in connection with any Participation or proposed Participation pursuant to this Section 7.08(b), disclose to the participant or proposed participant any information relating to the Operative Agreements or to the parties thereto furnished to the Liquidity Provider thereunder or in connection therewith and permitted to be disclosed by the Liquidity Provider; provided, however, that prior to any such disclosure, the participant or proposed participant shall agree in writing for the express benefit of the Borrower and Delta to preserve the confidentiality of any confidential information included therein (subject to customary exceptions). (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 or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 7.10. Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity. (a) Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof hereby (i) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (ii) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. (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) The Liquidity Provider hereby waives any immunity it may have from the jurisdiction of the courts of the United States or of any state thereof and waives any immunity any of its properties located in the United States may have from attachment or execution upon a judgment entered by any such court under the United States Foreign Sovereign Immunities Act of 1976 or any similar successor legislation. Section 7.12. Counterparts. This Agreement may be executed in any number of counterparts (and each party shall not be required to execute the same counterpart). Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts together shall constitute one instrument. Section 7.13. Entirety. This Agreement and the Intercreditor Agreement constitute the entire agreement of the parties hereto with respect to the subject matter hereof and supersede all prior understandings and agreements of such parties. Section 7.14. 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 7.15. 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 ABSOLUTE, UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first set forth above. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Subordination Agent, as agent and trustee for the Class G-1 Trust, as Borrower By: ----------------------------------------- Name: Title: WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: ----------------------------------------- Name: Title: By: ----------------------------------------- Name: Title: ANNEX I to REVOLVING CREDIT AGREEMENT INTEREST ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-1), dated as of April 30, 2002, 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 for the payment of the interest on the Class G-1 Certificates which is payable on ____________, ____ (the "Distribution Date") in accordance with the terms and provisions of the Class G-1 Trust Agreement and the Class G-1 Certificates, which Advance is requested to be made on ____________, ____. The Interest Advance should be remitted to [insert wire and account details]. (3) The amount of the Interest Advance requested hereby (i) is $_______________.__, to be applied in respect of the payment of the interest which is due and payable on the Class G-1 Certificates on the Distribution Date, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class G-1 Certificates, the Class G-2 Certificates, the Class C Certificates, the Class D Certificates, or interest on the Class G-2 Certificates or the Class C Certificates, or the Class D Certificates (iii) was computed in accordance with the provisions of the Class G-1 Certificates, or the Class G-1 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I), (iv) does not exceed the Maximum Available Commitment on the date hereof, (v) takes into account any amounts received in respect of any Series G-1 Equipment Note with respect of which a Policy Provider Election has been made and (vi) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will apply the same in accordance with the terms of Section 3.06(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 Certificate and such reduction shall automatically result in corresponding reductions in the amounts available to be borrowed pursuant to a subsequent Advance. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ---------------------------------- Name: Title: SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Interest Advance Notice of Borrowing] ANNEX II to REVOLVING CREDIT AGREEMENT NON-EXTENSION ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-1), dated as of April 30, 2002, 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 G-1 Cash Collateral Account in accordance with Section 3.06(d) of the Intercreditor Agreement, which Advance is requested to be made on __________, ____. The Non-Extension Advance should be remitted to [insert wire and account details]. (3) The amount of the Non-Extension Advance requested hereby (i) is $_______________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-1 Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class G-1 Certificates, or principal of, or interest or premium on, the Class G-2 Certificates, the Class C Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-1 Certificates, the Class G-1 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-1 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Non-Extension Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ---------------------------------- Name: Title: SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Non-Extension Advance Notice of Borrowing] ANNEX III to REVOLVING CREDIT AGREEMENT DOWNGRADE ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-1), dated as of April 30, 2002, 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 G-1 Cash Collateral Account in accordance with Section 3.06(c) of the Intercreditor Agreement by reason of the downgrading of the short-term rating or long-term rating of the Liquidity Provider issued by either Rating Agency below the Threshold Rating, which Advance is requested to be made on __________, ____. The Downgrade Advance should be remitted to [insert wire and account details]. (3) The amount of the Downgrade Advance requested hereby (i) is $_______________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-1 Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class G-1 Certificates, or principal of, or interest or premium on, the Class G-2 Certificates, the Class C Certificates, or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-1 Certificates, the Class G-1 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-1 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Downgrade Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ---------------------------------- Name: Title: SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Downgrade Advance Notice of Borrowing] ANNEX IV to REVOLVING CREDIT AGREEMENT FINAL ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-1), dated as of April 30, 2002, 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 G-1 Cash Collateral Account in accordance with Section 3.06(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 ____________, ____. The Final Advance should be remitted to [insert wire and account details]. (3) The amount of the Final Advance requested hereby (i) is $_________________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-1 Cash Collateral Account in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class G-1 Certificates, or principal of, or interest or premium on, the Class G-2 Certificates, the Class C Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-1 Certificates, the Class G-1 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-1 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. (5) [The Borrower hereby requests that the Advance requested hereby be a Base Rate Advance [and that such Base Rate Advance be converted into a LIBOR Advance on the third Business Day following your receipt of this notice]*.] The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Final Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: -------------------------------- Name: Title: [* Bracketed language may be included at Borrower's option.] SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Final Advance Notice of Borrowing] ANNEX V to REVOLVING CREDIT AGREEMENT NOTICE OF TERMINATION [Date] State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as Borrower 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Air Lines Pass Through Trust 2002-1G-1, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 and continuance of a Liquidity Event of Default and the existence of a Performing Note Deficiency (each as defined therein), we are giving this notice to you in order to cause (i) our obligations to make Advances (as defined therein) under such Liquidity Agreement to terminate at the close of business 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 3.06(i) of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a consequence of your receipt of this notice. THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY AGREEMENT WILL TERMINATE AT THE CLOSE OF BUSINESS ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU RECEIVE THIS NOTICE. Very truly yours, WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: -------------------------------------- Name: Title: cc: State Street Bank and Trust Company of Connecticut, National Association, as Class G-1 Trustee ANNEX VI to REVOLVING CREDIT AGREEMENT NOTICE OF REPLACEMENT SUBORDINATION AGENT [Date] Attention: Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Airlines Pass Through Trust 2002-1G-1, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 7.01 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. This transfer shall be effective as of [specify time and date]. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ---------------------------------- Name: Title: EX-4.(C)(2) 8 de763576-ex4c2.txt REVOLVING CREDIT AGMT Exhibit 4(c)(2) REVOLVING CREDIT AGREEMENT (2002-1G-2) Dated as of April 30, 2002 between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as agent and trustee for the trustee of Delta Air Lines Pass Through Trust 2002-1G-2, as Borrower and WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH as Liquidity Provider Delta Air Lines Pass Through Trust 2002-1G-2 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2 TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 1.01. Definitions....................................................... ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT Section 2.01. The Advances...................................................... Section 2.02. Making of Advances................................................ Section 2.03. Fees.............................................................. Section 2.04. Reduction or Termination of the Maximum Commitment................ Section 2.05. Repayments of Interest Advances or the Final Advance.............. Section 2.06. Repayments of Provider Advances................................... Section 2.07. Payments to the Liquidity Provider Under the Intercreditor Agreement......................................................... Section 2.08. Book Entries...................................................... Section 2.09. Payments from Available Funds Only................................ Section 2.10. Extension of the Expiry Date; Non-Extension Advance............... ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs................................................... Section 3.02. [Intentionally omitted.].......................................... Section 3.03. Withholding Taxes................................................. Section 3.04. Payments.......................................................... Section 3.05. Computations...................................................... Section 3.06. Payment on Non-Business Days...................................... Section 3.07. Interest.......................................................... Section 3.08. Replacement of Borrower........................................... Section 3.09. Funding Loss Indemnification...................................... Section 3.10. Illegality........................................................ ARTICLE IV CONDITIONS PRECEDENT Section 4.01. Conditions Precedent to Effectiveness of Section 2.01............. Section 4.02. Conditions Precedent to Borrowing................................. ARTICLE V COVENANTS Section 5.01. Affirmative Covenants of the Borrower............................. Section 5.02. Negative Covenants of the Borrower................................ ARTICLE VI LIQUIDITY EVENTS OF DEFAULT Section 6.01. Liquidity Events of Default....................................... ARTICLE VII MISCELLANEOUS Section 7.01. No Oral Modifications or Continuing Waivers....................... Section 7.02. Notices........................................................... Section 7.03. No Waiver; Remedies............................................... Section 7.04. Further Assurances................................................ Section 7.05. Indemnification; Survival of Certain Provisions................... Section 7.06. Liability of the Liquidity Provider............................... Section 7.07. Certain Costs and Expenses........................................ Section 7.08. Binding Effect; Participations.................................... Section 7.09. Severability...................................................... Section 7.10. Governing Law..................................................... Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity.......................................................... Section 7.12. Counterparts...................................................... Section 7.13. Entirety.......................................................... Section 7.14. Headings.......................................................... Section 7.15. Liquidity Provider's Obligation to Make Advances.................. Annex I - Interest Advance Notice of Borrowing Annex II - Non-Extension Advance Notice of Borrowing Annex III - Downgrade Advance Notice of Borrowing Annex IV - Final Advance Notice of Borrowing Annex V - Notice of Termination Annex VI - Notice of Replacement Subordination Agent REVOLVING CREDIT AGREEMENT This REVOLVING CREDIT AGREEMENT, dated as of April 30, 2002, is made by and between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Subordination Agent (such term and other capitalized terms used herein without definition being defined as provided in Article I) under the Intercreditor Agreement (as defined below), as agent and trustee for the Class G-2 Trustee (in such capacity, together with its successors in such capacity, the "Borrower"), and WESTDEUTSCHE LANDESBANK GIROZENTRALE, a German banking institution organized under the laws of the State of North Rhine-Westphalia ("WestLB"), acting through its New York Branch (the "Liquidity Provider"). W I T N E S S E T H: WHEREAS, pursuant to the Class G-2 Trust Agreement, the Class G-2 Trust is issuing the Class G-2 Certificates; and WHEREAS, the Borrower, in order to support the timely payment of a portion of the interest on the Class G-2 Certificates in accordance with their terms, has requested the 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 mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions. (a) The definitions stated herein apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Annexes" and other subdivisions are to the designated Article, Section, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) 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, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, it shall be deemed to be followed by the phrase "without limitation". (e) For the purposes of this Agreement, unless the context otherwise requires, the following capitalized terms shall have the following meanings: "Advance" means an Interest Advance, a Final Advance, a Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the case may be. "Agreement" means this Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Applicable Liquidity Rate" has the meaning specified in Section 3.07(g). "Applicable Margin" means with respect to any Unpaid Advance or Applied Provider Advance, 2.00% per annum. "Applied Downgrade Advance" has the meaning specified in Section 2.06(a). "Applied Non-Extension Advance" has the meaning specified in Section 2.06(a). "Applied Provider Advance" means an Applied Downgrade Advance or an Applied Non-Extension Advance. "Base Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 each day in the period for which the Base Rate is to be determined (or, if such day is not a Business Day, for the 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 (and reasonably satisfactory to Delta) plus one-quarter of one percent (0.25%). "Base Rate Advance" means an Advance that bears interest at a rate based upon the Base Rate. "Borrower" has the meaning specified in the introductory paragraph 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, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia, or, so long as any Class G-2 Certificate is outstanding, the city and state in which the Class G-2 Trustee, the Borrower or any related Loan Trustee maintains its Corporate Trust Office or receives or disburses funds, and, if the applicable Business Day relates to any Advance or other amount bearing interest based on the LIBOR Rate, on which dealings are carried on in the London interbank market. "Consent Notice" has the meaning specified in Section 2.10. "Consent Period" has the meaning specified in Section 2.10. "Covered Taxes" means any Taxes imposed by the United States or any political subdivision or taxing authority thereof or therein required by law to be deducted or withheld from any amounts payable to the Liquidity Provider under this Agreement other than (i) any Tax on, based on or measured by net income, franchises or conduct of business, (ii) any Tax imposed, levied, withheld or assessed as a result of any connection between the Liquidity Provider and the United States or such political subdivision or taxing authority, other than a connection arising solely from the Liquidity Provider's having executed, delivered, performed its obligations or received a payment under, or enforced, any Operative Agreement, (iii) any Tax attributable to the inaccuracy in or breach by the Liquidity Provider of any of its representations, warranties or covenants contained in any Operative Agreement to which it is a party or the inaccuracy of any form or document furnished pursuant thereto, (iv) any withholding Taxes imposed by the United States except to the extent such withholding Taxes would not have been required to be deducted or withheld from payments hereunder but for a change after the date hereof (or in the case of a successor Liquidity Provider (including a transferee of an Advance) after the date on which such successor Liquidity Provider obtains its interest) 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 other than the applicable income tax treaty between the United States of America and the Federal Republic of Germany ("German Treaty") (except an addition to, or change in any "anti-treaty shopping", "limitation of benefits" or similar provision in such German Treaty)), (v) 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, or (vi) any change in the Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "Downgrade Advance" means an Advance made pursuant to Section 2.02(c). "Effective Date" has the meaning specified in Section 4.01. The delivery of the certificate of the Liquidity Provider contemplated by Section 4.01(f) shall be conclusive evidence that the Effective Date has occurred. "Expenses" means liabilities, losses, damages, costs and expenses (including, without limitation, reasonable fees and disbursements of legal counsel), provided that Expenses shall not include any Taxes other than sales, use and V.A.T. taxes imposed on fees and expenses payable pursuant to Section 7.07. "Expiry Date" means April 28, 2003, initially, or any date to which the Expiry Date is extended pursuant to Section 2.10. "Final Advance" means an Advance made pursuant to Section 2.02(d). "Increased Cost" has the meaning specified in Section 3.01. "Intercreditor Agreement" means the Intercreditor Agreement, dated as of the date hereof, among the Trustees, the Liquidity Provider, the liquidity provider under each Liquidity Facility (other than this Agreement), the Policy Provider and the Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interest Advance" means an Advance made pursuant to Section 2.02(a). "Interest Period" means, with respect to any LIBOR Advance, each of the following periods: (i) the period beginning on the third Business Day following either (A) the Liquidity Provider's receipt of the Notice of Borrowing for such LIBOR Advance or (B) the date of the withdrawal of funds from the Class G-2 Cash Collateral Account for the purpose of paying interest on the Class G-2 Certificates as contemplated by Section 2.06(a) hereof and, in each case, ending on the next numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; and (ii) each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; provided, however, that if (x) the Final Advance shall have been made pursuant to Section 2.02(d) or (y) other outstanding Advances shall have been converted into the Final Advance pursuant to Section 6.01, then the Interest Periods shall be successive periods of one month beginning on the third 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 following such conversion (in the case of clause (y) above). "Lending Office" means the lending office of the Liquidity Provider presently located at New York, New York, or such other lending office as the Liquidity Provider from time to time shall notify the Borrower as its lending office hereunder; provided that the Liquidity Provider shall not change its Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "LIBOR Advance" means an Advance bearing interest at a rate based upon the LIBOR Rate. "LIBOR Rate" means, with respect to any Interest Period, (a) the interest rate per annum equal to the rate per annum at which deposits in Dollars are offered in the London interbank market as shown on Page 3750 of the Telerate Systems Incorporated screen service (or such other page as may replace Telerate Page 3750), or if such service is not available, Page LIBO of the Reuters Money Service Monitor System (or such other page as may replace Reuters Page LIBO) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period, for a period comparable to such Interest Period, or (b) if no such rate is published on either such service or if neither of such services is then available, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the London interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (c) if none of the Reference Banks is quoting a rate for deposits in Dollars in the London interbank market for such a period and amount, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the principal New York offices of the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (New York time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the New York interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (d) if none of the principal New York offices of the Reference Banks is quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, the Base Rate. "Liquidity Event of Default" means the occurrence of either (a) the Acceleration of all of the Equipment Notes or (b) a Delta Bankruptcy Event. "Liquidity Indemnitee" means the Liquidity Provider, its directors, officers, employees and agents, and its successors and permitted assigns. "Liquidity Provider" has the meaning specified in the introductory paragraph 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 or a Final Advance, the Maximum Available Commitment shall be zero. "Maximum Commitment" means initially $39,734,094.66, as the same may be reduced from time to time in accordance with Section 2.04(a). "Non-Extension Advance" means an Advance made pursuant to Section 2.02(b). "Notice of Borrowing" has the meaning specified in Section 2.02(e). "Notice of Replacement Subordination Agent" has the meaning specified in Section 3.08. "Participation" has the meaning specified in Section 7.08(b). "Performing Note Deficiency" means any time that less than 65% of the then aggregate outstanding principal amount of all Equipment Notes are Performing Equipment Notes. "Permitted Transferee" means any Person that: (a) is not a commercial air carrier, Delta or any affiliate of Delta; and (b) is any one of: (1) a commercial banking institution organized under the laws of the United States or any state thereof or the District of Columbia; (2) a commercial banking institution that (x) is organized under the laws of France, Germany, The Netherlands, Switzerland or the United Kingdom, (y) is entitled on the date it acquires any Participation to a complete exemption from United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under an income tax treaty, as in effect on such date, between the United States and such jurisdiction of its organization and (z) is engaged in the active conduct of a banking business in such jurisdiction of its organization, holds its Participation in connection with such banking business in such jurisdiction and is regulated as a commercial banking institution by the appropriate regulatory authorities in such jurisdiction; or (3) a commercial banking institution that (x) is organized under the laws of Canada, France, Germany, Ireland, Japan, Luxembourg, The Netherlands, Sweden, Switzerland or the United Kingdom and (y) is entitled on the date it acquires any Participation to a complete exemption from withholding of United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under laws as in effect on such date by reason of such income being effectively connected with the conduct of a trade or business within the United States. "Prospectus Supplement" means the Prospectus Supplement dated April 23, 2002, relating to the Certificates, as such Prospectus Supplement may be amended or supplemented. "Provider Advance" means a Downgrade Advance or a Non-Extension Advance. "Reference Banks" means the principal London offices of: National Westminster Bank, plc; WestLB; J.P. Morgan Chase Bank; Citibank, N.A.; and such other or additional banking institutions as may be designated from time to time by mutual agreement of Delta and the Liquidity Provider. "Regulatory Change" means the enactment, adoption or promulgation, after the date of this Agreement, of any law or regulation by a United States federal or state government or by the government of the Liquidity Provider's jurisdiction of organization, or any change, after the date of this Agreement, in any such law or regulation, or in the interpretation thereof by any governmental authority, central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization charged with responsibility for the administration or application thereof, that shall impose, modify or deem applicable: (a) any reserve, special deposit or similar requirement against extensions of credit or other assets of, or deposits with or other liabilities of, the Liquidity Provider including, or by reason of, the Advances, or (b) any capital adequacy requirement requiring the maintenance by the Liquidity Provider of additional capital in respect of any Advances or the Liquidity Provider's obligation to make any such Advances. "Replenishment Amount" has the meaning specified in Section 2.06(b). "Required Amount" means, for any day, the sum of the aggregate amount of interest, calculated at the rate per annum equal to the Stated Interest Rate for the Class G-2 Certificates on the basis of a 360-day year comprised of twelve 30-day months, that would be payable on the Class G-2 Certificates on each of the three successive semiannual Regular Distribution Dates immediately following such day or, if such day is a Regular Distribution Date, on such day and the succeeding two semiannual Regular Distribution Dates, in each case calculated on the basis of the Pool Balance of the Class G-2 Certificates on such day and without regard to expected future distributions of principal on the Class G-2 Certificates. Notwithstanding the above, in the event of a Policy Provider Election with respect to a Series G-2 Equipment Note, the Pool Balance, for purposes of this definition, shall be deemed to be reduced by an amount (if positive) by which (a) the then outstanding principal balance of such Series G-2 Equipment Note shall exceed (b) the amount of any policy drawings previously paid by the Policy Provider in respect of principal on such Series G-2 Equipment Note. "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 G-2 Certificates have been paid in full (or provision has been made for such payment in accordance with the Intercreditor Agreement and the Class G-2 Trust Agreement) 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 3.06(e) of the Intercreditor Agreement; (iv) the fifth Business Day following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01; 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. "Unapplied Provider Advance" means any Provider Advance other than an Applied Provider Advance. "Unpaid Advance" has the meaning specified in Section 2.05. "Withdrawal Notice" has the meaning specified in Section 2.10. For the purposes of this Agreement, the following terms shall have the respective meanings specified in the Intercreditor Agreement: "Acceleration", "Certificate", "Class C Certificates", "Class D Certificates", "Class G-1 Certificates", "Class G-2 Cash Collateral Account", "Class G-2 Certificates", "Class G-2 Certificateholders", "Class G-2 Trust", "Class G-2 Trust Agreement", "Class G-2 Trustee", "Closing Date", "Collection Account", "Controlling Party", "Corporate Trust Office", "Delta", "Delta Bankruptcy Event", "Distribution Date", "Dollars", "Downgraded Facility", "Equipment Notes", "Fee Letter", "Final Legal Distribution Date", "Indenture", "Initial Class D Holder", "Interest Payment Date", "Investment Earnings", "Liquidity Facility", "Liquidity Obligations", "Loan Trustee", "Moody's", "Non-Extended Facility", "Operative Agreements", "Participation Agreements", "Performing Equipment Note", "Person", "Policy", "Policy Provider", "Policy Provider Election", "Pool Balance", "Rating Agencies", "Ratings Confirmation", "Regular Distribution Date", "Replacement Liquidity Facility", "Responsible Officer", "Scheduled Payment", "Special Payment", "S&P", "Stated Interest Rate", "Subordination Agent", "Taxes", "Threshold Rating", "Trust Agreement", "Trustee", "Underwriters", "Underwriting Agreement", "United States" and "Written Notice". 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 12:00 noon (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 of Advances. (a) Each Interest Advance shall be made by the Liquidity Provider upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex I, signed by a Responsible Officer of the Borrower, such Interest Advance to be in an amount not exceeding the Maximum Available Commitment at such time and used solely for the payment when due of interest with respect to the Class G-2 Certificates at the Stated Interest Rate therefor in accordance with Section 3.06(a) and 3.06(b) 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 or in part 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 an amount equal to the amount of such Interest Advance so repaid, but not to exceed the Maximum Commitment; provided, however, that the Maximum Available Commitment shall not be so reinstated at any time if (x) both a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing or (y) a Final Drawing shall have occurred. (b) Subject to Section 2.10, a Non-Extension Advance shall be made by the Liquidity Provider if this Agreement is not extended in accordance with Section 3.06(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 3.06(d) within the time period specified in such Section 3.06(d)) upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex II, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-2 Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement. (c) A Downgrade Advance shall be made by the Liquidity Provider if at any time the short-term unsecured debt rating (in the case of Moody's) or short-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by Moody's or S&P, respectively, (or if the Liquidity Provider does not have a short-term unsecured debt rating or short-term corporate credit rating, as applicable, issued by a given Rating Agency, the long-term unsecured debt rating (in the case of Moody's) or long-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by such Rating Agency) is lower than the applicable Threshold Rating (as provided for in Section 3.06(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 3.06(c), upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex III, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-2 Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement. (d) A Final Advance shall be made by the Liquidity Provider following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01 upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex IV, signed by a Responsible Officer of the Borrower, in an amount equal to the Maximum Available Commitment at such time, and shall be used to fund the Class G-2 Cash Collateral Account (in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement). (e) Each Borrowing shall be made on notice in writing (a "Notice of Borrowing") in substantially the form required by Section 2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the Borrower to the 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 Dollars and immediately available funds, before 4:00 p.m. (New York City time) on such Business Day or before 1:00 p.m. (New York City time) on such later Business Day specified in such Notice of Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect of any Borrowing 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 Dollars and immediately available funds, before 1:00 p.m. (New York City time) on the first Business Day next following the day of receipt of such Notice of Borrowing or on such later Business Day specified by the Borrower in such Notice of Borrowing. Payments of proceeds of a Borrowing shall be made by wire transfer of immediately available funds to the Borrower in accordance with such wire transfer instructions as the Borrower shall furnish from time to time to the Liquidity Provider for such purpose. Each Notice of Borrowing shall be irrevocable and binding on the Borrower. Each Notice of Borrowing shall be effective upon delivery of a copy thereof to the Liquidity Provider's New York branch at the address specified in Section 7.02 hereof. (f) Upon the making of any Advance requested pursuant to a Notice of Borrowing in accordance with the Borrower's payment instructions, the 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 (including the Trustee or any Class G-2 Certificateholder). 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 said 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), 2.02(c) or 2.02(d) to fund the Class G-2 Cash Collateral Account, the Liquidity Provider shall have no interest in or rights to the Class G-2 Cash Collateral Account, such Advance or any other amounts from time to time on deposit in the Class G-2 Cash Collateral Account; provided that the foregoing shall not affect or impair the obligations of the Subordination Agent to make the distributions contemplated by Section 3.06(e) or 3.06(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 G-2 Cash Collateral Account to the extent provided in Section 2.02(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. Section 2.03. Fees. The Borrower agrees to pay to the Liquidity Provider the fees set forth in the Fee Letter. Section 2.04. Reduction or Termination of the Maximum Commitment. (a) Automatic Reduction. Promptly following each date on which the Required Amount is reduced as a result of a reduction in the Pool Balance of the Class G-2 Certificates or otherwise (including upon any Policy Provider Election with respect to a Series G-2 Equipment Note), the Maximum Commitment shall automatically be reduced to an amount equal to such reduced Required Amount (as calculated by the Borrower). The Borrower shall give notice of any such automatic reduction of the Maximum Commitment to the Liquidity Provider and Delta within two Business Days thereof. The failure by the Borrower to furnish any such notice shall not affect such automatic reduction of the Maximum Commitment. (b) Termination. Upon the making of any Provider Advance or Final Advance hereunder or the occurrence of the Termination Date, the obligation of the Liquidity Provider to make further Advances hereunder shall automatically and irrevocably terminate, and the Borrower shall not be entitled to request any further Borrowing hereunder. Section 2.05. Repayments of Interest Advances or the Final Advance. Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees, without notice of an Advance or demand for repayment from the Liquidity Provider (which notice and demand are hereby waived by the Borrower), to pay, or to cause to be paid, to the Liquidity Provider (a) on each date on which the Liquidity Provider shall make an Interest Advance or the Final Advance, an amount equal to the amount of such Advance (any such Advance, until repaid, is referred to herein as an "Unpaid Advance"), plus (b) interest on the amount of each such Unpaid Advance in the amounts and on the dates determined as provided in Section 3.07; 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)). The Borrower and the Liquidity Provider agree that the repayment in full of each Interest Advance and Final Advance on the date such Advance is made is intended to be a contemporaneous exchange for new value given to the Borrower by the Liquidity Provider. For the avoidance of doubt, interest payable on an Interest Advance or the Final Advance shall not be regarded as overdue unless such interest is not paid when due under Section 3.07. Section 2.06. Repayments of Provider Advances. (a) Amounts advanced hereunder in respect of a Provider Advance shall be deposited in the Class G-2 Cash Collateral Account and invested and withdrawn from the Class G-2 Cash Collateral Account as set forth in Sections 3.06(c), 3.06(d), 3.06(e) and 3.06(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, in the amounts determined as provided in Section 3.07; provided, however, that amounts in respect of a Provider Advance withdrawn from the Class G-2 Cash Collateral Account for the purpose of paying interest on the Class G-2 Certificates in accordance with Section 3.06(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, such Provider Advance shall thereafter be treated as a Final Advance under this Agreement for purposes of determining the Applicable Liquidity Rate for interest payable thereon and the dates on which such interest is payable. Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal of any amounts from the Class G-2 Cash Collateral Account on account of a reduction in the Required Amount, the Borrower shall repay to the Liquidity Provider a portion of the Provider Advances in a principal amount equal to such reduction, plus interest on the principal amount prepaid as provided in Section 3.07. (b) At any time when an Applied Provider Advance (or any portion thereof) is outstanding, upon the deposit in the Class G-2 Cash Collateral Account of any amount pursuant to clause "third" of Section 2.04(b) of the Intercreditor Agreement, clause "third" of Section 3.02 of the Intercreditor Agreement or clause "fourth" of Section 3.03 of the Intercreditor Agreement (any such amount being a "Replenishment Amount") for the purpose of replenishing or increasing the balance thereof up to the Required Amount at such time, (i) the aggregate outstanding principal amount of all Applied Provider Advances (and of Provider Advances treated as an Interest Advance for purposes of determining the Applicable Liquidity Rate for interest payable thereon) shall be automatically reduced by the amount of such Replenishment Amount, and (ii) the aggregate outstanding principal amount of all Unapplied Provider Advances shall be automatically increased by the amount of such Replenishment Amount. (c) Upon the provision of a Replacement Liquidity Facility in replacement of this Agreement in accordance with Section 3.06(e) of the Intercreditor Agreement, as provided in Section 3.06(f) of the Intercreditor Agreement, amounts remaining on deposit in the Class G-2 Cash Collateral Account after giving effect to any Applied Provider Advance on the date of such replacement shall be reimbursed to the Liquidity Provider, but only to the extent such amounts are necessary to repay in full to the 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 3.06(f) of the Intercreditor Agreement), shall be paid to the Liquidity Provider in accordance with the terms thereof (but, for the avoidance of doubt, without duplication of or increase in any amounts payable hereunder). Amounts so paid to the Liquidity Provider shall be applied by the Liquidity Provider in the order of priority required by the applicable provisions of Articles II and III of the Intercreditor Agreement and shall discharge in full the corresponding obligations of the Borrower hereunder. 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 shall be made only from the amounts that constitute Scheduled Payments, Special Payments and other payments under the Operative Agreements, including payment under Section 4.02 of the Participation Agreements and payments under Section 2.14 of the Indentures, 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 to the extent available for distribution to it as provided in the Intercreditor Agreement and this Agreement and that the Borrower, in its individual capacity, is not personally liable to it for any amounts payable or liability under this Agreement except as expressly provided in this Agreement, the Intercreditor Agreement or any Participation Agreement. Amounts on deposit in the Class G-2 Cash Collateral Account shall be available to the Borrower to make payments under this Agreement only to the extent and for the purposes expressly contemplated in Section 3.06(f) of the Intercreditor Agreement. Section 2.10. Extension of the Expiry Date; Non-Extension Advance. If the Expiry Date is prior to the date that is 15 days after the Final Legal Distribution Date for the Class G-2 Certificates, then no earlier than the 60th day and no later than the 40th day prior to the then applicable Expiry Date, the Borrower may request in writing 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 G-2 Certificates and (ii) the date that is the day immediately preceding the 364th day after the last day of the Consent Period (unless the obligations of the Liquidity Provider hereunder are earlier terminated in accordance herewith). The Liquidity Provider shall by notice (the "Consent Notice") to the Borrower during the period commencing on the date that is 60 days prior to the then effective Expiry Date and ending on the date that is 25 days prior to the then effective Expiry Date (the "Consent Period") advise the Borrower whether, in its sole discretion, it agrees to so extend the Expiry Date; provided, however, that such extension shall not be effective with respect to the Liquidity Provider if, by notice (the "Withdrawal Notice") to the Borrower prior to the end of the Consent Period, the Liquidity Provider revokes its Consent Notice. If the Liquidity Provider advises the Borrower in the Consent Notice that such Expiry Date shall not be so extended, or gives a Withdrawal Notice to the Borrower prior to the end of the Consent Period, or fails to irrevocably and unconditionally advise the Borrower on or before the end of the Consent Period 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 3.06(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 3.06(d) of the Intercreditor Agreement. If any amounts shall be drawn pursuant to a Non-Extension Advance and, within 30 days thereafter, the Liquidity Provider shall not have been replaced, then at any time following the 30th day after such Non-Extension Advance, the Liquidity Provider may, by written notice to the Borrower, agree to reinstate the Liquidity Facility on the terms of the existing Liquidity Facility for a period ending on the 364th day after the end of the Consent Period; provided, however, that in such event the Liquidity Provider shall reimburse the Borrower for any costs actually incurred by or on behalf of the Borrower in drawing pursuant to the Non-Extension Advance and funding the Class G-2 Cash Collateral Account or otherwise in connection with the Non-Extension Advance. ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs. If as a result of any Regulatory Change there shall be any increase by an amount reasonably deemed by the Liquidity Provider to be material in the actual cost to the Liquidity Provider of making, funding or maintaining any Advances or its obligation to make any such Advances or there shall be any reduction by an amount reasonably deemed by the Liquidity Provider to be material in the amount receivable by the Liquidity Provider under this Agreement or the Intercreditor Agreement in respect thereof, and in case of either such an increase or reduction, such event does not arise from the gross negligence or willful misconduct of the Liquidity Provider, from its breach of any of its representations, warranties, covenants or agreements contained herein or in the Intercreditor Agreement or from its failure to comply with any such Regulatory Change (any such increase or reduction being referred to herein as an "Increased Cost"), then the Borrower shall from time to time pay to the Liquidity Provider an amount equal to such Increased Cost within 15 Business Days after delivery to the Borrower and Delta of a certificate of an officer of the Liquidity Provider describing in reasonable detail the event by reason of which it claims such Increased Cost and the basis for the determination of the amount of such Increased Cost; provided that, the Borrower shall be obligated to pay amounts only with respect to any Increased Costs accruing from the date 45 days prior to the date of delivery of such certificate. Such certificate, in the absence of manifest error, shall be considered prima facie evidence of the amount of the Increased Costs for purposes of this Agreement; provided that any determinations and allocations by the Liquidity Provider of the effect of any Regulatory Change on the costs of maintaining the Advances are made on a reasonable basis. The Liquidity Provider shall not be entitled to assert any claim under this Section 3.01 in respect of or attributable to Taxes. The Liquidity Provider will notify the Borrower and Delta as promptly as practicable of any event occurring after the date of this Agreement that will entitle the Liquidity Provider to compensation under this Section 3.01. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for reducing any Increased Costs and to use all commercially reasonable efforts (consistent with applicable legal and regulatory restrictions) to avoid or minimize, to the greatest extent possible, any claim in respect of Increased Costs, including, without limitation, by designating a different Lending Office, if such designation or other action would avoid the need for, or reduce the amount of, any such claim; provided that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for any claim in respect of Increased Costs, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. Notwithstanding the foregoing provisions, in no event shall the Borrower be required to make payments under this Section 3.01: (a) in respect of any Regulatory Change proposed by any applicable governmental authority (including any branch of a legislature), central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization and pending as of the date of this Agreement (it being agreed that the consultative paper issued by the Basel Committee on Banking Supervision entitled "The New Basel Capital Accord", dated January 2001, shall not be considered to have been proposed or pending as of the date of this Agreement); (b) if a claim hereunder in respect of an Increased Cost arises through circumstances peculiar to the Liquidity Provider and that do not affect similarly organized commercial banking institutions in the same jurisdiction generally that are in compliance with the law, rule, regulation or interpretation giving rise to the Regulatory Change relating to such Increased Cost; (c) if the Liquidity Provider shall fail to comply with its obligations under this Section 3.01; or (d) if the Liquidity Provider is not also seeking payment for similar increased costs in other similarly situated transactions. Section 3.02. [Intentionally omitted.] Section 3.03. Withholding Taxes. (a) All payments made by the Borrower under this Agreement shall be made without deduction or withholding for or on account of any Taxes, unless such deduction or withholding is required by law. If any Taxes are so required to be withheld or deducted from any amounts payable to the Liquidity Provider under this Agreement, the Borrower shall pay to the relevant authorities the full amount so required to be deducted or withheld and, if such Taxes are Covered Taxes, pay to the Liquidity Provider such additional amounts as shall be necessary to ensure that the net amount actually received by the Liquidity Provider (after deduction or withholding of all Covered Taxes) shall be equal to the full amount that would have been received by the Liquidity Provider had no withholding or deduction of Covered Taxes been required. The Liquidity Provider agrees to use reasonable efforts (consistent with applicable legal and regulatory restrictions) to change the jurisdiction of its Lending 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 materially disadvantageous to the Liquidity Provider. If the Liquidity Provider receives a refund of, or realizes a net Tax benefit not otherwise available to it as a result of, any Taxes for which additional amounts were paid by the Borrower pursuant to this Section 3.03, the Liquidity Provider shall pay to the Borrower (for deposit into the Collection Account) the amount of such refund (and any interest thereon) or net benefit. The Liquidity Provider will (i) provide (on its behalf and on behalf of any participant holding a Participation pursuant to Section 7.08) to the Borrower (x) on or prior to the Effective Date two valid completed and executed copies of Internal Revenue Service Form W8-BEN or W8-EC1 (whichever is applicable), including thereon a valid U.S. taxpayer identification number (or, with respect to any such participant, such other form or documentation as may be applicable) covering all amounts receivable by it in connection with the transactions contemplated by the Operative Agreements and (y) thereafter from time to time such additional forms or documentation as may be necessary to establish an available exemption from withholding of United States Tax on payments hereunder so that such forms or documentation are effective for all periods during which it is the Liquidity Provider and (ii) provide timely notice to the Borrower if any such form or documentation is or becomes inaccurate. The Liquidity Provider shall deliver to the Borrower such other forms or documents as may be reasonably requested by the Borrower or required by applicable law to establish that payments hereunder are exempt from or entitled to a reduced rate of Covered Taxes. (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 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. If any exemption from, or reduction in the rate of, any Taxes required to be borne by the Liquidity Provider under this Section 3.03(b) is reasonably available to the Borrower without providing any information regarding the holders or beneficial owners of the Certificates, the Borrower shall deliver the Liquidity Provider such form or forms and such other evidence of the eligibility of the Borrower for such exemption or reductions (but without any requirement to provide any information regarding the holders or beneficial owners of the Certificates) 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, such 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 Dollars, to the Liquidity Provider in immediately available funds, by wire transfer to J.P. Morgan Chase Bank, 021-000021 in favor of account number 9201060663, Westdeutsche Landesbank New York Branch, Reference: Delta EETC 2002-1, G-2 LF. Section 3.05. Computations. All computations of interest based on the Base Rate shall be made on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the LIBOR Rate shall be made on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable. Section 3.06. Payment on Non-Business Days. Whenever any payment to be made hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and no additional interest shall be due as a result (and if so made, shall be deemed to have been made when due). If any payment in respect of interest on an Advance is so deferred to the next succeeding Business Day, such deferral shall not delay the commencement of the next Interest Period for such Advance (if such Advance is a LIBOR Advance) or reduce the number of days for which interest will be payable on such Advance on the next interest payment date for such Advance. Section 3.07. Interest. (a) Subject to Sections 2.07 and 2.09, the Borrower shall pay, or shall cause to be paid, without duplication, interest on (i) the unpaid principal amount of each Advance from and including the date of such Advance (or, in the case of an Applied Provider Advance, from and including the date on which the amount thereof was withdrawn from the Class G-2 Cash Collateral Account to pay interest on the Class G-2 Certificates) to but excluding the date such principal amount shall be paid in full (or, in the case of an Applied Provider Advance, the date on which the Class G-2 Cash Collateral Account is fully replenished in respect of such Advance) and (ii) any other amount due hereunder (whether fees, commissions, expenses or other amounts or, to the extent permitted by law, installments of interest on Advances or any such other amount) that 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 the interest rate per annum for each day equal to the Applicable Liquidity Rate (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 to the maximum extent permitted by applicable law 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 absolute amount of interest that would have accrued (without additional interest thereon) if such otherwise applicable interest rate as set forth in this Section 3.07 had at all relevant times been in effect. Nothing contained in this Section 3.07 shall require the Borrower to pay any amount under this Section 3.07 other than to the extent the Borrower shall have funds available therefor. (b) Except as provided in Section 3.07(e), each Advance will be either a Base Rate Advance or a LIBOR Advance as provided in this Section 3.07. Each such Advance will be a Base Rate Advance for the period from the date of its borrowing to (but excluding) the third Business Day following the 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, pursuant to Section 2.06, such Final Advance is deemed to have been made without delivery of a Notice of Borrowing, by requesting, prior to 11:00 a.m. 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 Provider Advance shall bear interest in an amount equal to the Investment Earnings on amounts on deposit in the Class G-2 Cash Collateral Account for such Unapplied Provider Advance on the amount of such Unapplied Provider 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. (g) Each change in the Base Rate shall become effective immediately. The rates of interest specified in this Section 3.07 with respect to any Advance or other amount shall be referred to as the "Applicable Liquidity Rate". Section 3.08. Replacement of Borrower. Subject to Section 5.02, from time to time and subject to the successor Borrower's meeting the eligibility requirements set forth in Section 6.09 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 (a "Notice of Replacement Subordination Agent") delivered to the Liquidity Provider by the then Borrower, the successor Borrower designated therein shall become 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 the Applicable Margin or anticipated profits) incurred as a result of: (1) Any repayment of a LIBOR Advance on a date other than the last day of the Interest Period for such Advance; or (2) Any failure by the Borrower to borrow a LIBOR Advance on the date for borrowing specified in the relevant notice under Section 2.02. Section 3.10. Illegality. Notwithstanding any other provision in this Agreement, if any change in any law, rule or regulation applicable to or binding on the Liquidity Provider, 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 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 to maintain or fund its LIBOR Advances, then upon notice to the Borrower and Delta 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 reasonable judgment of the Liquidity Provider, requires immediate conversion; 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 will notify the Borrower and Delta as promptly as practicable of any event that will lead to the conversion of LIBOR Advances to Base Rate Advances under this Section 3.10. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for avoiding the need for such conversion, including, without limitation, designating a different Lending Office, if such designation or other action would avoid the need to convert such LIBOR Advances to Base Rate Advances; provided, that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for conversion of the LIBOR Advances to Base Rate Advances, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. 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 by the appropriate party or parties): (a) The Liquidity Provider shall have received on or before the Closing Date 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; (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 and the Intercreditor Agreement); (iv) A copy of the Prospectus Supplement and specimen copies of the Class G-2 Certificates; (v) An executed copy of each document, instrument, certificate and opinion delivered on or before the Closing Date pursuant to the Class G-2 Trust Agreement, the Intercreditor Agreement and the other Operative Agreements (in the case of each such opinion, 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); and (vi) An agreement from Delta, pursuant to which (x) Delta agrees to provide copies of quarterly financial statements and audited annual financial statements to the Liquidity Provider (which Delta may provide in an electronic format by electronic mail or making such available over the internet) and (y) Delta agrees to allow the Liquidity Provider to discuss the transactions contemplated by the Operative Agreements with officers and employees of Delta. (b) On and as of the Effective Date no event shall have occurred and be 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 filings referred to in Sections 3.01(d) and 3.01(f) of the Participation Agreements shall have been filed (or shall be in the process of being filed). (d) The Liquidity Provider shall have received payment in full of the fees and other sums required to be paid to or for the account of the Liquidity Provider on or prior to the Effective Date pursuant to the Fee Letter. (e) All conditions precedent to the issuance of the Certificates under the Trust Agreement shall have been satisfied or waived, all conditions precedent to the effectiveness of the other Liquidity Facilities shall have been satisfied or waived, and all conditions precedent to the purchase of the Certificates by the Underwriters under the Underwriting Agreement shall have been satisfied (unless any of such conditions precedent under the Underwriting Agreement shall have been waived by the Underwriters), and all conditions precedent to the purchase of the Class D Certificates by the Initial Class D Holder shall have been satisfied. (f) The Borrower and Delta shall have received a certificate, dated the Effective Date signed by a duly authorized representative of the Liquidity Provider, certifying that all conditions precedent specified in this Section 4.01 have been satisfied or waived by the Liquidity Provider. 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, prior to the time of such Borrowing, the Borrower shall have delivered a Notice of Borrowing which conforms to the terms and conditions of this Agreement. 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 Agreements. Punctually pay or cause to be paid all amounts payable by it under this Agreement and the Intercreditor Agreement and observe and perform in all material respects the conditions, covenants and requirements applicable to it contained in this Agreement and the Intercreditor Agreement. (b) Reporting Requirements. Furnish to the Liquidity Provider with reasonable promptness, such other information and data with respect to the transactions contemplated by the Operative Agreements as from time to time may be reasonably requested by the 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, copies of 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. Subject to the first and fourth paragraphs of Section 7.01(a) of the Intercreditor Agreement and Section 7.01(b) of the Intercreditor Agreement, 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 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) this Agreement to expire at the close of business 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 3.06(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, all Advances, 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. 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 Borrower and the Liquidity Provider and any other Person whose consent is required pursuant to this Agreement; provided that no such change or other action relating to payment terms (including timing of any payments) shall affect the payment obligations of Delta without Delta's prior written consent and any such change or other action relating to payment terms (including timing of any payments) that would adversely affect the interests of the Policy Provider shall require the consent of the Policy Provider; and any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given. Section 7.02. Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: If to the Borrower, to: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION 225 Asylum Street, Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Telecopy: (860) 244-1881 If to the Liquidity Provider, to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Transportation Finance Telephone: (212) 852-6111 Telecopy: (212) 869-7634 With a copy to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Loan Administration Telephone: (212) 852-6323 Telecopy: (212) 302-7946 Any party, by notice to the other party hereto, may designate additional or different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 7.02. 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 4.02 of the Participation Agreements. In addition, the Borrower agrees to indemnify, protect, defend and hold harmless each Liquidity Indemnitee from and against all Expenses of any kind or nature whatsoever (other than any Expenses of the nature described in Sections 3.01 or 7.07 or in the Fee Letter (regardless of whether indemnified against pursuant to said Sections or in such Fee Letter)), that may be imposed on or incurred by such 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 Participation 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 negligence or willful misconduct of such Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) an ordinary and usual operating overhead expense, (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 or any other Operative Agreement to which it is a party or (iv) otherwise excluded from the indemnification provisions contained in Section 4.02 of the Participation Agreements. The provisions of Sections 3.01, 3.03, 3.09, 7.05 and 7.07 and the indemnities contained in Section 4.02 of the Participation Agreements 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 or directors 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 that were the result of (A) the Liquidity Provider's willful misconduct or gross 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 or the Intercreditor 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 complying with the terms and conditions hereof. (b) Neither the Liquidity Provider nor any of its officers, employees or directors or affiliates shall be liable or responsible in any respect for (i) any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with this Agreement or any Notice of Borrowing delivered hereunder or (ii) any action, inaction or omission which may be taken by it in good faith, absent willful misconduct or negligence (in which event the extent of the Liquidity Provider's potential liability to the Borrower shall be limited as set forth in the immediately preceding paragraph), in connection with this Agreement or any Notice of Borrowing. Section 7.07. Certain Costs and Expenses. The Borrower agrees promptly to pay, or cause to be paid, (a) the reasonable fees, expenses and disbursements of Milbank, Tweed, Hadley & McCloy LLP, special counsel for the Liquidity Provider, in connection with the preparation, negotiation, execution, delivery, filing and recording of the Operative Agreements, any waiver or consent thereunder or any amendment thereof and (b) if a Liquidity Event of Default occurs, all out-of-pocket expenses incurred by the Liquidity Provider, including reasonable fees and disbursements of counsel, in connection with such Liquidity Event of Default and any collection, bankruptcy, insolvency and other enforcement proceedings in connection therewith. In addition, the Borrower shall pay any and all recording, stamp and other similar taxes and fees payable or determined to be payable in the United States in connection with the execution, delivery, filing and recording of this Agreement, any other Operative Agreement and such other documents, and agrees to save the 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 permitted assigns, except that neither the Liquidity Provider (except as otherwise provided in this Section 7.08) nor (except as contemplated by Section 3.08) the Borrower shall have the right to assign, pledge or otherwise transfer its rights or obligations hereunder or any interest herein, subject to the Liquidity Provider's right to grant Participations pursuant to Section 7.08(b). (b) The Liquidity Provider agrees that it will not grant any participation (including, without limitation, a "risk participation") (any such participation, a "Participation") in or to all or a portion of its rights and obligations hereunder or under the other Operative Agreements, unless all of the following conditions are satisfied: (i) such Participation is to a Permitted Transferee, (ii) such Participation is made in accordance with all applicable laws, including, without limitation, the Securities Act of 1933, as amended, the Trust Indenture Act of 1939, as amended, and any other applicable laws relating to the transfer of similar interests and (iii) such Participation shall not be made under circumstances that require registration under the Securities Act of 1933, as amended, or qualification of any indenture under the Trust Indenture Act of 1939, as amended. Notwithstanding any such Participation, the Liquidity Provider agrees that (1) the Liquidity Provider's obligations under the Operative Agreements shall remain unchanged, and such participant shall have no rights or benefits as against Delta or the Borrower or under any Operative Agreement, (2) the Liquidity Provider shall remain solely responsible to the other parties to the Operative Agreements for the performance of such obligations, (3) the Liquidity Provider shall remain the maker of any Advances, and the other parties to the Operative Agreements shall continue to deal solely and directly with the Liquidity Provider in connection with the Advances and the Liquidity Provider's rights and obligations under the Operative Agreements, (4) the Liquidity Provider shall be solely responsible for any withholding Taxes or any filing or reporting requirements relating to such Participation and shall hold the Borrower and Delta and their respective successors, permitted assigns, affiliates, agents and servants harmless against the same and (5) neither Delta nor the Borrower shall be required to pay to the Liquidity Provider any amount under Section 3.01 or Section 3.03 greater than it would have been required to pay had there not been any grant of a Participation by the Liquidity Provider. The Liquidity Provider may, in connection with any Participation or proposed Participation pursuant to this Section 7.08(b), disclose to the participant or proposed participant any information relating to the Operative Agreements or to the parties thereto furnished to the Liquidity Provider thereunder or in connection therewith and permitted to be disclosed by the Liquidity Provider; provided, however, that prior to any such disclosure, the participant or proposed participant shall agree in writing for the express benefit of the Borrower and Delta to preserve the confidentiality of any confidential information included therein (subject to customary exceptions). (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 or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 7.10. Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity. (a) Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof hereby (i) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (ii) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. (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) The Liquidity Provider hereby waives any immunity it may have from the jurisdiction of the courts of the United States or of any state thereof and waives any immunity any of its properties located in the United States may have from attachment or execution upon a judgment entered by any such court under the United States Foreign Sovereign Immunities Act of 1976 or any similar successor legislation. Section 7.12. Counterparts. This Agreement may be executed in any number of counterparts (and each party shall not be required to execute the same counterpart). Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts together shall constitute one instrument. Section 7.13. Entirety. This Agreement and the Intercreditor Agreement constitute the entire agreement of the parties hereto with respect to the subject matter hereof and supersede all prior understandings and agreements of such parties. Section 7.14. 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 7.15. 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 ABSOLUTE, UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first set forth above. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Subordination Agent, as agent and trustee for the Class G-2 Trust, as Borrower By: ____________________________________ Name: Title: WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: ____________________________________ Name: Title: By: ____________________________________ Name: Title: ANNEX I to REVOLVING CREDIT AGREEMENT INTEREST ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-2), dated as of April 30, 2002, 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 for the payment of the interest on the Class G-2 Certificates which is payable on ____________, ____ (the "Distribution Date") in accordance with the terms and provisions of the Class G-2 Trust Agreement and the Class G-2 Certificates, which Advance is requested to be made on ____________, ____. The Interest Advance should be remitted to [insert wire and account details]. (3) The amount of the Interest Advance requested hereby (i) is $_______________.__, to be applied in respect of the payment of the interest which is due and payable on the Class G-2 Certificates on the Distribution Date, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class G-2 Certificates, the Class G-1 Certificates, the Class C Certificates, the Class D Certificates, or interest on the Class G-1 Certificates or the Class C Certificates, or the Class D Certificates (iii) was computed in accordance with the provisions of the Class G-2 Certificates, or the Class G-2 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I), (iv) does not exceed the Maximum Available Commitment on the date hereof, (v) takes into account any amounts received in respect of any Series G-2 Equipment Note with respect of which a Policy Provider Election has been made and (vi) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will apply the same in accordance with the terms of Section 3.06(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 Certificate and such reduction shall automatically result in corresponding reductions in the amounts available to be borrowed pursuant to a subsequent Advance. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ____________________________________ Name: Title: SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Interest Advance Notice of Borrowing] ANNEX II to REVOLVING CREDIT AGREEMENT NON-EXTENSION ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-2), dated as of April 30, 2002, 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 G-2 Cash Collateral Account in accordance with Section 3.06(d) of the Intercreditor Agreement, which Advance is requested to be made on __________, ____. The Non-Extension Advance should be remitted to [insert wire and account details]. (3) The amount of the Non-Extension Advance requested hereby (i) is $_______________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-2 Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class G-2 Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class C Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-2 Certificates, the Class G-2 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-2 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Non-Extension Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ____________________________________ Name: Title: SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Non-Extension Advance Notice of Borrowing] ANNEX III to REVOLVING CREDIT AGREEMENT DOWNGRADE ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-2), dated as of April 30, 2002, 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 G-2 Cash Collateral Account in accordance with Section 3.06(c) of the Intercreditor Agreement by reason of the downgrading of the short-term rating or long-term rating of the Liquidity Provider issued by either Rating Agency below the Threshold Rating, which Advance is requested to be made on __________, ____. The Downgrade Advance should be remitted to [insert wire and account details]. (3) The amount of the Downgrade Advance requested hereby (i) is $_______________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-2 Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class G-2 Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class C Certificates, or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-2 Certificates, the Class G-2 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-2 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Downgrade Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ____________________________________ Name: Title: SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Downgrade Advance Notice of Borrowing] ANNEX IV to REVOLVING CREDIT AGREEMENT FINAL ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1G-2), dated as of April 30, 2002, 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 G-2 Cash Collateral Account in accordance with Section 3.06(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 ____________, ____. The Final Advance should be remitted to [insert wire and account details]. (3) The amount of the Final Advance requested hereby (i) is $_________________.__, which equals the Maximum Available Commitment on the date hereof and is to be applied in respect of the funding of the Class G-2 Cash Collateral Account in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class G-2 Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class C Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class G-2 Certificates, the Class G-2 Trust Agreement and the Intercreditor Agreement (a copy of which computation is attached hereto as Schedule I) and (iv) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will deposit such amount in the Class G-2 Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. (5) [The Borrower hereby requests that the Advance requested hereby be a Base Rate Advance [and that such Base Rate Advance be converted into a LIBOR Advance on the third Business Day following your receipt of this notice]*.] The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Final Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ____________________________________ Name: Title: [* Bracketed language may be included at Borrower's option.] SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Final Advance Notice of Borrowing] ANNEX V to REVOLVING CREDIT AGREEMENT NOTICE OF TERMINATION [Date] State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as Borrower 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Air Lines Pass Through Trust 2002-1G-2, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 and continuance of a Liquidity Event of Default and the existence of a Performing Note Deficiency (each as defined therein), we are giving this notice to you in order to cause (i) our obligations to make Advances (as defined therein) under such Liquidity Agreement to terminate at the close of business 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 3.06(i) of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a consequence of your receipt of this notice. THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY AGREEMENT WILL TERMINATE AT THE CLOSE OF BUSINESS ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU RECEIVE THIS NOTICE. Very truly yours, WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: ____________________________________ Name: Title: cc: State Street Bank and Trust Company of Connecticut, National Association, as Class G-2 Trustee ANNEX VI to REVOLVING CREDIT AGREEMENT NOTICE OF REPLACEMENT SUBORDINATION AGENT [Date] Attention: Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Airlines Pass Through Trust 2002-1G-2, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 7.01 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. This transfer shall be effective as of [specify time and date]. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ____________________________________ Name: Title: EX-4.(C)(3) 9 de763576-ex4c3.txt REVOLVING CREDIT AGMT Exhibit 4(c)(3) REVOLVING CREDIT AGREEMENT (2002-1C) Dated as of April 30, 2002 between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as agent and trustee for the trustee of Delta Air Lines Pass Through Trust 2002-1C, as Borrower and WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH as Liquidity Provider Delta Air Lines Pass Through Trust 2002-1C 7.779% Delta Air Lines Pass Through Certificates, Series 2002-1C TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 1.01. Definitions.................................................... ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT Section 2.01. The Advances................................................... Section 2.02. Making of Advances............................................. Section 2.03. Fees........................................................... Section 2.04. Reduction or Termination of the Maximum Commitment............. Section 2.05. Repayments of Interest Advances or the Final Advance........... Section 2.06. Repayments of Provider Advances................................ Section 2.07. Payments to the Liquidity Provider Under the Intercreditor Agreement.................................. Section 2.08. Book Entries................................................... Section 2.09. Payments from Available Funds Only............................. Section 2.10. Extension of the Expiry Date; Non-Extension Advance............ ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs................................................ Section 3.02. [Intentionally omitted.]....................................... Section 3.03. Withholding Taxes.............................................. Section 3.04. Payments....................................................... Section 3.05. Computations................................................... Section 3.06. Payment on Non-Business Days................................... Section 3.07. Interest....................................................... Section 3.08. Replacement of Borrower........................................ Section 3.09. Funding Loss Indemnification................................... Section 3.10. Illegality..................................................... ARTICLE IV CONDITIONS PRECEDENT Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.......... Section 4.02. Conditions Precedent to Borrowing.............................. ARTICLE V COVENANTS Section 5.01. Affirmative Covenants of the Borrower.......................... Section 5.02. Negative Covenants of the Borrower............................. ARTICLE VI LIQUIDITY EVENTS OF DEFAULT Section 6.01. Liquidity Events of Default.................................... ARTICLE VII MISCELLANEOUS Section 7.01. No Oral Modifications or Continuing Waivers.................... Section 7.02. Notices........................................................ Section 7.03. No Waiver; Remedies............................................ Section 7.04. Further Assurances............................................. Section 7.05. Indemnification; Survival of Certain Provisions................ Section 7.06. Liability of the Liquidity Provider............................ Section 7.07. Certain Costs and Expenses..................................... Section 7.08. Binding Effect; Participations................................. Section 7.09. Severability................................................... Section 7.10. Governing Law.................................................. Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity........................................... Section 7.12. Counterparts................................................... Section 7.13. Entirety....................................................... Section 7.14. Headings....................................................... Section 7.15. Liquidity Provider's Obligation to Make Advances............... Annex I - Interest Advance Notice of Borrowing Annex II - Non-Extension Advance Notice of Borrowing Annex III - Downgrade Advance Notice of Borrowing Annex IV - Final Advance Notice of Borrowing Annex V - Notice of Termination Annex VI - Notice of Replacement Subordination Agent REVOLVING CREDIT AGREEMENT This REVOLVING CREDIT AGREEMENT, dated as of April 30, 2002, is made by and between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Subordination Agent (such term and other capitalized terms used herein without definition being defined as provided in Article I) under the Intercreditor Agreement (as defined below), as agent and trustee for the Class C Trustee (in such capacity, together with its successors in such capacity, the "Borrower"), and WESTDEUTSCHE LANDESBANK GIROZENTRALE, a German banking institution organized under the laws of the State of North Rhine-Westphalia ("WestLB"), acting through its New York Branch (the "Liquidity Provider"). W I T N E S S E T H: WHEREAS, pursuant to the Class C Trust Agreement, the Class C Trust is issuing the Class C Certificates; and WHEREAS, the Borrower, in order to support the timely payment of a portion of the interest on the Class C 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 mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions. (a) The definitions stated herein apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Annexes" and other subdivisions are to the designated Article, Section, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) 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, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, it shall be deemed to be followed by the phrase "without limitation". (e) For the purposes of this Agreement, unless the context otherwise requires, the following capitalized terms shall have the following meanings: "Advance" means an Interest Advance, a Final Advance, a Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the case may be. "Agreement" means this Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Applicable Liquidity Rate" has the meaning specified in Section 3.07(g). "Applicable Margin" means with respect to any Unpaid Advance or Applied Provider Advance, 2.00% per annum. "Applied Downgrade Advance" has the meaning specified in Section 2.06(a). "Applied Non-Extension Advance" has the meaning specified in Section 2.06(a). "Applied Provider Advance" means an Applied Downgrade Advance or an Applied Non-Extension Advance. "Base Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 each day in the period for which the Base Rate is to be determined (or, if such day is not a Business Day, for the 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 (and reasonably satisfactory to Delta) plus one-quarter of one percent (0.25%). "Base Rate Advance" means an Advance that bears interest at a rate based upon the Base Rate. "Borrower" has the meaning specified in the introductory paragraph 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, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia, or, so long as any Class C Certificate is outstanding, the city and state in which the Class C Trustee, the Borrower or any related Loan Trustee maintains its Corporate Trust Office or receives or disburses funds, and, if the applicable Business Day relates to any Advance or other amount bearing interest based on the LIBOR Rate, on which dealings are carried on in the London interbank market. "Consent Notice" has the meaning specified in Section 2.10. "Consent Period" has the meaning specified in Section 2.10. "Covered Taxes" means any Taxes imposed by the United States or any political subdivision or taxing authority thereof or therein required by law to be deducted or withheld from any amounts payable to the Liquidity Provider under this Agreement other than (i) any Tax on, based on or measured by net income, franchises or conduct of business, (ii) any Tax imposed, levied, withheld or assessed as a result of any connection between the Liquidity Provider and the United States or such political subdivision or taxing authority, other than a connection arising solely from the Liquidity Provider's having executed, delivered, performed its obligations or received a payment under, or enforced, any Operative Agreement, (iii) any Tax attributable to the inaccuracy in or breach by the Liquidity Provider of any of its representations, warranties or covenants contained in any Operative Agreement to which it is a party or the inaccuracy of any form or document furnished pursuant thereto, (iv) any withholding Taxes imposed by the United States except to the extent such withholding Taxes would not have been required to be deducted or withheld from payments hereunder but for a change after the date hereof (or in the case of a successor Liquidity Provider (including a transferee of an Advance) after the date on which such successor Liquidity Provider obtains its interest) 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 other than the applicable income tax treaty between the United States of America and the Federal Republic of Germany ("German Treaty") (except an addition to, or change in any "anti-treaty shopping", "limitation of benefits" or similar provision in such German Treaty)), (v) 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, or (vi) any change in the Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "Downgrade Advance" means an Advance made pursuant to Section 2.02(c). "Effective Date" has the meaning specified in Section 4.01. The delivery of the certificate of the Liquidity Provider contemplated by Section 4.01(f) shall be conclusive evidence that the Effective Date has occurred. "Expenses" means liabilities, losses, damages, costs and expenses (including, without limitation, reasonable fees and disbursements of legal counsel), provided that Expenses shall not include any Taxes other than sales, use and V.A.T. taxes imposed on fees and expenses payable pursuant to Section 7.07. "Expiry Date" means April 28, 2003, initially, or any date to which the Expiry Date is extended pursuant to Section 2.10. "Final Advance" means an Advance made pursuant to Section 2.02(d). "Increased Cost" has the meaning specified in Section 3.01. "Intercreditor Agreement" means the Intercreditor Agreement, dated as of the date hereof, among the Trustees, the Liquidity Provider, the liquidity provider under each Liquidity Facility (other than this Agreement), the Policy Provider and the Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interest Advance" means an Advance made pursuant to Section 2.02(a). "Interest Period" means, with respect to any LIBOR Advance, each of the following periods: (i) the period beginning on the third Business Day following either (A) the Liquidity Provider's receipt of the Notice of Borrowing for such LIBOR Advance or (B) the date of the withdrawal of funds from the Class C Cash Collateral Account for the purpose of paying interest on the Class C Certificates as contemplated by Section 2.06(a) hereof and, in each case, ending on the next numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; and (ii) each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day in the first calendar month after the first day of the applicable Interest Period; provided, however, that if (x) the Final Advance shall have been made pursuant to Section 2.02(d) or (y) other outstanding Advances shall have been converted into the Final Advance pursuant to Section 6.01, then the Interest Periods shall be successive periods of one month beginning on the third 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 following such conversion (in the case of clause (y) above). "Lending Office" means the lending office of the Liquidity Provider presently located at New York, New York, or such other lending office as the Liquidity Provider from time to time shall notify the Borrower as its lending office hereunder; provided that the Liquidity Provider shall not change its Lending Office without the prior written consent of Delta (such consent not to be unreasonably withheld). "LIBOR Advance" means an Advance bearing interest at a rate based upon the LIBOR Rate. "LIBOR Rate" means, with respect to any Interest Period, (a) the interest rate per annum equal to the rate per annum at which deposits in Dollars are offered in the London interbank market as shown on Page 3750 of the Telerate Systems Incorporated screen service (or such other page as may replace Telerate Page 3750), or if such service is not available, Page LIBO of the Reuters Money Service Monitor System (or such other page as may replace Reuters Page LIBO) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period, for a period comparable to such Interest Period, or (b) if no such rate is published on either such service or if neither of such services is then available, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (London time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the London interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (c) if none of the Reference Banks is quoting a rate for deposits in Dollars in the London interbank market for such a period and amount, the interest rate per annum equal to the average (rounded up, if necessary, to the nearest 1/100th of 1%) of the rates at which deposits in Dollars are offered by the principal New York offices of the Reference Banks (or, if fewer than all of the Reference Banks are quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, such fewer number of Reference Banks) at approximately 11:00 a.m. (New York time) on the day that is two Business Days prior to the first day of such Interest Period to prime banks in the New York interbank market for a period comparable to such Interest Period and in an amount approximately equal to the principal amount of the LIBOR Advance to be outstanding during such Interest Period, or (d) if none of the principal New York offices of the Reference Banks is quoting a rate for deposits in Dollars in the New York interbank market for the applicable period and amount, the Base Rate. "Liquidity Event of Default" means the occurrence of either (a) the Acceleration of all of the Equipment Notes or (b) a Delta Bankruptcy Event. "Liquidity Indemnitee" means the Liquidity Provider, its directors, officers, employees and agents, and its successors and permitted assigns. "Liquidity Provider" has the meaning specified in the introductory paragraph 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 or a Final Advance, the Maximum Available Commitment shall be zero. "Maximum Commitment" means initially $21,942,780.20, as the same may be reduced from time to time in accordance with Section 2.04(a). "Non-Extension Advance" means an Advance made pursuant to Section 2.02(b). "Notice of Borrowing" has the meaning specified in Section 2.02(e). "Notice of Replacement Subordination Agent" has the meaning specified in Section 3.08. "Participation" has the meaning specified in Section 7.08(b). "Performing Note Deficiency" means any time that less than 65% of the then aggregate outstanding principal amount of all Equipment Notes are Performing Equipment Notes. "Permitted Transferee" means any Person that: (a) is not a commercial air carrier, Delta or any affiliate of Delta; and (b) is any one of: (1) a commercial banking institution organized under the laws of the United States or any state thereof or the District of Columbia; (2) a commercial banking institution that (x) is organized under the laws of France, Germany, The Netherlands, Switzerland or the United Kingdom, (y) is entitled on the date it acquires any Participation to a complete exemption from United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under an income tax treaty, as in effect on such date, between the United States and such jurisdiction of its organization and (z) is engaged in the active conduct of a banking business in such jurisdiction of its organization, holds its Participation in connection with such banking business in such jurisdiction and is regulated as a commercial banking institution by the appropriate regulatory authorities in such jurisdiction; or (3) a commercial banking institution that (x) is organized under the laws of Canada, France, Germany, Ireland, Japan, Luxembourg, The Netherlands, Sweden, Switzerland or the United Kingdom and (y) is entitled on the date it acquires any Participation to a complete exemption from withholding of United States federal income taxes for all income derived by it from the transactions contemplated by the Operative Agreements under laws as in effect on such date by reason of such income being effectively connected with the conduct of a trade or business within the United States. "Prospectus Supplement" means the Prospectus Supplement dated April 23, 2002, relating to the Certificates, as such Prospectus Supplement may be amended or supplemented. "Provider Advance" means a Downgrade Advance or a Non-Extension Advance. "Reference Banks" means the principal London offices of: National Westminster Bank, plc; WestLB; J.P. Morgan Chase Bank; Citibank, N.A.; and such other or additional banking institutions as may be designated from time to time by mutual agreement of Delta and the Liquidity Provider. "Regulatory Change" means the enactment, adoption or promulgation, after the date of this Agreement, of any law or regulation by a United States federal or state government or by the government of the Liquidity Provider's jurisdiction of organization, or any change, after the date of this Agreement, in any such law or regulation, or in the interpretation thereof by any governmental authority, central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization charged with responsibility for the administration or application thereof, that shall impose, modify or deem applicable: (a) any reserve, special deposit or similar requirement against extensions of credit or other assets of, or deposits with or other liabilities of, the Liquidity Provider including, or by reason of, the Advances, or (b) any capital adequacy requirement requiring the maintenance by the Liquidity Provider of additional capital in respect of any Advances or the Liquidity Provider's obligation to make any such Advances. "Replenishment Amount" has the meaning specified 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 C Certificates on the basis of a 360-day year comprised of twelve 30-day months, that would be payable on the Class C Certificates on each of the three successive semiannual Regular Distribution Dates immediately following such day or, if such day is a Regular Distribution Date, on such day and the succeeding two semiannual Regular Distribution Dates, in each case calculated on the basis of the Pool Balance of the Class C Certificates on such day and without regard to expected future distributions of principal on the Class C Certificates. "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 C Certificates have been paid in full (or provision has been made for such payment in accordance with the Intercreditor Agreement and the Class C Trust Agreement) 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 3.06(e) of the Intercreditor Agreement; (iv) the fifth Business Day following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01; 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. "Unapplied Provider Advance" means any Provider Advance other than an Applied Provider Advance. "Unpaid Advance" has the meaning specified in Section 2.05. "Withdrawal Notice" has the meaning specified in Section 2.10. For the purposes of this Agreement, the following terms shall have the respective meanings specified in the Intercreditor Agreement: "Acceleration", "Certificate", "Class C Cash Collateral Account", "Class C Certificates", "Class C Certificateholders", "Class C Trust", "Class C Trust Agreement", "Class C Trustee", "Class D Certificates", "Class G-1 Certificates", "Class G-2 Certificates", "Closing Date", "Collection Account", "Controlling Party", "Corporate Trust Office", "Delta", "Delta Bankruptcy Event", "Distribution Date", "Dollars", "Downgraded Facility", "Equipment Notes", "Fee Letter", "Final Legal Distribution Date", "Indenture", "Initial Class D Holder", "Interest Payment Date", "Investment Earnings", "Liquidity Facility", "Liquidity Obligations", "Loan Trustee", "Moody's", "Non-Extended Facility", "Operative Agreements", "Participation Agreements", "Performing Equipment Note", "Person", "Pool Balance", "Rating Agencies", "Ratings Confirmation", "Regular Distribution Date", "Replacement Liquidity Facility", "Responsible Officer", "Scheduled Payment", "Special Payment", "S&P", "Stated Interest Rate", "Subordination Agent", "Taxes", "Threshold Rating", "Trust Agreement", "Trustee", "Underwriters", "Underwriting Agreement", "United States" and "Written Notice". 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 12:00 noon (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 of Advances. (a) Each Interest Advance shall be made by the Liquidity Provider upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex I, signed by a Responsible Officer of the Borrower, such Interest Advance to be in an amount not exceeding the Maximum Available Commitment at such time and used solely for the payment when due of interest with respect to the Class C Certificates at the Stated Interest Rate therefor in accordance with Section 3.06(a) and 3.06(b) 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 or in part 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 an amount equal to the amount of such Interest Advance so repaid, but not to exceed the Maximum Commitment; provided, however, that the Maximum Available Commitment shall not be so reinstated at any time if (x) both a Performing Note Deficiency exists and a Liquidity Event of Default shall have occurred and be continuing or (y) a Final Drawing shall have occurred. (b) Subject to Section 2.10, a Non-Extension Advance shall be made by the Liquidity Provider if this Agreement is not extended in accordance with Section 3.06(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 3.06(d) within the time period specified in such Section 3.06(d)) upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex II, 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 C Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement. (c) A Downgrade Advance shall be made by the Liquidity Provider if at any time the short-term unsecured debt rating (in the case of Moody's) or short-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by Moody's or S&P, respectively, (or if the Liquidity Provider does not have a short-term unsecured debt rating or short-term corporate credit rating, as applicable, issued by a given Rating Agency, the long-term unsecured debt rating (in the case of Moody's) or long-term corporate credit rating (in the case of S&P) of the Liquidity Provider issued by such Rating Agency) is lower than the applicable Threshold Rating (as provided for in Section 3.06(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 3.06(c), upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex III, 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 C Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement. (d) A Final Advance shall be made by the Liquidity Provider following the receipt by the Borrower of a Termination Notice from the Liquidity Provider pursuant to Section 6.01 upon delivery to the Liquidity Provider of a written and completed Notice of Borrowing in substantially the form of Annex IV, 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 C Cash Collateral Account (in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement). (e) Each Borrowing shall be made on notice in writing (a "Notice of Borrowing") in substantially the form required by Section 2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the Borrower to the 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 Dollars and immediately available funds, before 4:00 p.m. (New York City time) on such Business Day or before 1:00 p.m. (New York City time) on such later Business Day specified in such Notice of Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect of any Borrowing 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 Dollars and immediately available funds, before 1:00 p.m. (New York City time) on the first Business Day next following the day of receipt of such Notice of Borrowing or on such later Business Day specified by the Borrower in such Notice of Borrowing. Payments of proceeds of a Borrowing shall be made by wire transfer of immediately available funds to the Borrower in accordance with such wire transfer instructions as the Borrower shall furnish from time to time to the Liquidity Provider for such purpose. Each Notice of Borrowing shall be irrevocable and binding on the Borrower. Each Notice of Borrowing shall be effective upon delivery of a copy thereof to the Liquidity Provider's New York branch at the address specified in Section 7.02 hereof. (f) Upon the making of any Advance requested pursuant to a Notice of Borrowing in accordance with the Borrower's payment instructions, the 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 (including the Trustee or any Class C Certificateholder). 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 said 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), 2.02(c) or 2.02(d) to fund the Class C Cash Collateral Account, the Liquidity Provider shall have no interest in or rights to the Class C Cash Collateral Account, such Advance or any other amounts from time to time on deposit in the Class C 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 3.06(e) or 3.06(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 C Cash Collateral Account to the extent provided in Section 2.02(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. Section 2.03. Fees. The Borrower agrees to pay to the Liquidity Provider the fees set forth in the Fee Letter. Section 2.04. Reduction 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 C Certificates or otherwise, the Maximum Commitment shall automatically be reduced to an amount equal to such reduced Required Amount (as calculated by the Borrower). The Borrower shall give notice of any such automatic reduction of the Maximum Commitment to the Liquidity Provider and Delta within two Business Days thereof. The failure by the Borrower to furnish any such notice shall not affect such automatic reduction of the Maximum Commitment. (b) Termination. Upon the making of any Provider Advance or Final Advance hereunder or the occurrence of the Termination Date, the obligation of the Liquidity Provider to make further Advances hereunder shall automatically and irrevocably terminate, and the Borrower shall not be entitled to request any further Borrowing hereunder. Section 2.05. Repayments of Interest Advances or the Final Advance. Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees, without notice of an Advance or demand for repayment from the Liquidity Provider (which notice and demand are hereby waived by the Borrower), to pay, or to cause to be paid, to the Liquidity Provider (a) on each date on which the Liquidity Provider shall make an Interest Advance or the Final Advance, an amount equal to the amount of such Advance (any such Advance, until repaid, is referred to herein as an "Unpaid Advance"), plus (b) interest on the amount of each such Unpaid Advance in the amounts and on the dates determined as provided in Section 3.07; 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)). The Borrower and the Liquidity Provider agree that the repayment in full of each Interest Advance and Final Advance on the date such Advance is made is intended to be a contemporaneous exchange for new value given to the Borrower by the Liquidity Provider. For the avoidance of doubt, interest payable on an Interest Advance or the Final Advance shall not be regarded as overdue unless such interest is not paid when due under Section 3.07. Section 2.06. Repayments of Provider Advances. (a) Amounts advanced hereunder in respect of a Provider Advance shall be deposited in the Class C Cash Collateral Account and invested and withdrawn from the Class C Cash Collateral Account as set forth in Sections 3.06(c), 3.06(d), 3.06(e) and 3.06(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, in the amounts determined as provided in Section 3.07; provided, however, that amounts in respect of a Provider Advance withdrawn from the Class C Cash Collateral Account for the purpose of paying interest on the Class C Certificates in accordance with Section 3.06(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, such Provider Advance shall thereafter be treated as a Final Advance under this Agreement for purposes of determining the Applicable Liquidity Rate for interest payable thereon and the dates on which such interest is payable. Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal of any amounts from the Class C 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 such reduction, plus interest on the principal amount prepaid as provided in Section 3.07. (b) At any time when an Applied Provider Advance (or any portion thereof) is outstanding, upon the deposit in the Class C Cash Collateral Account of any amount pursuant to clause "third" of Section 2.04(b) of the Intercreditor Agreement, clause "third" of Section 3.02 of the Intercreditor Agreement or clause "fourth" of Section 3.03 of the Intercreditor Agreement (any such amount being a "Replenishment Amount") for the purpose of replenishing or increasing the balance thereof up to the Required Amount at such time, (i) the aggregate outstanding principal amount of all Applied Provider Advances (and of Provider Advances treated as an Interest Advance for purposes of determining the Applicable Liquidity Rate for interest payable thereon) shall be automatically reduced by the amount of such Replenishment Amount, and (ii) the aggregate outstanding principal amount of all Unapplied Provider Advances shall be automatically increased by the amount of such Replenishment Amount. (c) Upon the provision of a Replacement Liquidity Facility in replacement of this Agreement in accordance with Section 3.06(e) of the Intercreditor Agreement, as provided in Section 3.06(f) of the Intercreditor Agreement, amounts remaining on deposit in the Class C Cash Collateral Account after giving effect to any Applied Provider Advance on the date of such replacement shall be reimbursed to the Liquidity Provider, but only to the extent such amounts are necessary to repay in full to the 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 3.06(f) of the Intercreditor Agreement), shall be paid to the Liquidity Provider in accordance with the terms thereof (but, for the avoidance of doubt, without duplication of or increase in any amounts payable hereunder). Amounts so paid to the Liquidity Provider shall be applied by the Liquidity Provider in the order of priority required by the applicable provisions of Articles II and III of the Intercreditor Agreement and shall discharge in full the corresponding obligations of the Borrower hereunder. 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 shall be made only from the amounts that constitute Scheduled Payments, Special Payments and other payments under the Operative Agreements, including payment under Section 4.02 of the Participation Agreements and payments under Section 2.14 of the Indentures, 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 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 C 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 3.06(f) of the Intercreditor Agreement. Section 2.10. Extension of the Expiry Date; Non-Extension Advance. If the Expiry Date is prior to the date that is 15 days after the Final Legal Distribution Date for the Class C Certificates, then no earlier than the 60th day and no later than the 40th day prior to the then applicable Expiry Date, the Borrower may request in writing 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 C Certificates and (ii) the date that is the day immediately preceding the 364th day after the last day of the Consent Period (unless the obligations of the Liquidity Provider hereunder are earlier terminated in accordance herewith). The Liquidity Provider shall by notice (the "Consent Notice") to the Borrower during the period commencing on the date that is 60 days prior to the then effective Expiry Date and ending on the date that is 25 days prior to the then effective Expiry Date (the "Consent Period") advise the Borrower whether, in its sole discretion, it agrees to so extend the Expiry Date; provided, however, that such extension shall not be effective with respect to the Liquidity Provider if, by notice (the "Withdrawal Notice") to the Borrower prior to the end of the Consent Period, the Liquidity Provider revokes its Consent Notice. If the Liquidity Provider advises the Borrower in the Consent Notice that such Expiry Date shall not be so extended, or gives a Withdrawal Notice to the Borrower prior to the end of the Consent Period, or fails to irrevocably and unconditionally advise the Borrower on or before the end of the Consent Period 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 3.06(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 3.06(d) of the Intercreditor Agreement. If any amounts shall be drawn pursuant to a Non-Extension Advance and, within 30 days thereafter, the Liquidity Provider shall not have been replaced, then at any time following the 30th day after such Non-Extension Advance, the Liquidity Provider may, by written notice to the Borrower, agree to reinstate the Liquidity Facility on the terms of the existing Liquidity Facility for a period ending on the 364th day after the end of the Consent Period; provided, however, that in such event the Liquidity Provider shall reimburse the Borrower for any costs actually incurred by or on behalf of the Borrower in drawing pursuant to the Non-Extension Advance and funding the Class C Cash Collateral Account or otherwise in connection with the Non-Extension Advance. ARTICLE III OBLIGATIONS OF THE BORROWER Section 3.01. Increased Costs. If as a result of any Regulatory Change there shall be any increase by an amount reasonably deemed by the Liquidity Provider to be material in the actual cost to the Liquidity Provider of making, funding or maintaining any Advances or its obligation to make any such Advances or there shall be any reduction by an amount reasonably deemed by the Liquidity Provider to be material in the amount receivable by the Liquidity Provider under this Agreement or the Intercreditor Agreement in respect thereof, and in case of either such an increase or reduction, such event does not arise from the gross negligence or willful misconduct of the Liquidity Provider, from its breach of any of its representations, warranties, covenants or agreements contained herein or in the Intercreditor Agreement or from its failure to comply with any such Regulatory Change (any such increase or reduction being referred to herein as an "Increased Cost"), then the Borrower shall from time to time pay to the Liquidity Provider an amount equal to such Increased Cost within 15 Business Days after delivery to the Borrower and Delta of a certificate of an officer of the Liquidity Provider describing in reasonable detail the event by reason of which it claims such Increased Cost and the basis for the determination of the amount of such Increased Cost; provided that, the Borrower shall be obligated to pay amounts only with respect to any Increased Costs accruing from the date 45 days prior to the date of delivery of such certificate. Such certificate, in the absence of manifest error, shall be considered prima facie evidence of the amount of the Increased Costs for purposes of this Agreement; provided that any determinations and allocations by the Liquidity Provider of the effect of any Regulatory Change on the costs of maintaining the Advances are made on a reasonable basis. The Liquidity Provider shall not be entitled to assert any claim under this Section 3.01 in respect of or attributable to Taxes. The Liquidity Provider will notify the Borrower and Delta as promptly as practicable of any event occurring after the date of this Agreement that will entitle the Liquidity Provider to compensation under this Section 3.01. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for reducing any Increased Costs and to use all commercially reasonable efforts (consistent with applicable legal and regulatory restrictions) to avoid or minimize, to the greatest extent possible, any claim in respect of Increased Costs, including, without limitation, by designating a different Lending Office, if such designation or other action would avoid the need for, or reduce the amount of, any such claim; provided that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for any claim in respect of Increased Costs, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. Notwithstanding the foregoing provisions, in no event shall the Borrower be required to make payments under this Section 3.01: (a) in respect of any Regulatory Change proposed by any applicable governmental authority (including any branch of a legislature), central bank or comparable agency of the United States or the Liquidity Provider's jurisdiction of organization and pending as of the date of this Agreement (it being agreed that the consultative paper issued by the Basel Committee on Banking Supervision entitled "The New Basel Capital Accord", dated January 2001, shall not be considered to have been proposed or pending as of the date of this Agreement); (b) if a claim hereunder in respect of an Increased Cost arises through circumstances peculiar to the Liquidity Provider and that do not affect similarly organized commercial banking institutions in the same jurisdiction generally that are in compliance with the law, rule, regulation or interpretation giving rise to the Regulatory Change relating to such Increased Cost; (c) if the Liquidity Provider shall fail to comply with its obligations under this Section 3.01; or (d) if the Liquidity Provider is not also seeking payment for similar increased costs in other similarly situated transactions. Section 3.02. [Intentionally omitted.] Section 3.03. Withholding Taxes. (a) All payments made by the Borrower under this Agreement shall be made without deduction or withholding for or on account of any Taxes, unless such deduction or withholding is required by law. If any Taxes are so required to be withheld or deducted from any amounts payable to the Liquidity Provider under this Agreement, the Borrower shall pay to the relevant authorities the full amount so required to be deducted or withheld and, if such Taxes are Covered Taxes, pay to the Liquidity Provider such additional amounts as shall be necessary to ensure that the net amount actually received by the Liquidity Provider (after deduction or withholding of all Covered Taxes) shall be equal to the full amount that would have been received by the Liquidity Provider had no withholding or deduction of Covered Taxes been required. The Liquidity Provider agrees to use reasonable efforts (consistent with applicable legal and regulatory restrictions) to change the jurisdiction of its Lending 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 materially disadvantageous to the Liquidity Provider. If the Liquidity Provider receives a refund of, or realizes a net Tax benefit not otherwise available to it as a result of, any Taxes for which additional amounts were paid by the Borrower pursuant to this Section 3.03, the Liquidity Provider shall pay to the Borrower (for deposit into the Collection Account) the amount of such refund (and any interest thereon) or net benefit. The Liquidity Provider will (i) provide (on its behalf and on behalf of any participant holding a Participation pursuant to Section 7.08) to the Borrower (x) on or prior to the Effective Date two valid completed and executed copies of Internal Revenue Service Form W8-BEN or W8-EC1 (whichever is applicable), including thereon a valid U.S. taxpayer identification number (or, with respect to any such participant, such other form or documentation as may be applicable) covering all amounts receivable by it in connection with the transactions contemplated by the Operative Agreements and (y) thereafter from time to time such additional forms or documentation as may be necessary to establish an available exemption from withholding of United States Tax on payments hereunder so that such forms or documentation are effective for all periods during which it is the Liquidity Provider and (ii) provide timely notice to the Borrower if any such form or documentation is or becomes inaccurate. The Liquidity Provider shall deliver to the Borrower such other forms or documents as may be reasonably requested by the Borrower or required by applicable law to establish that payments hereunder are exempt from or entitled to a reduced rate of Covered Taxes. (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 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. If any exemption from, or reduction in the rate of, any Taxes required to be borne by the Liquidity Provider under this Section 3.03(b) is reasonably available to the Borrower without providing any information regarding the holders or beneficial owners of the Certificates, the Borrower shall deliver the Liquidity Provider such form or forms and such other evidence of the eligibility of the Borrower for such exemption or reductions (but without any requirement to provide any information regarding the holders or beneficial owners of the Certificates) 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, such 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 Dollars, to the Liquidity Provider in immediately available funds, by wire transfer to J.P. Morgan Chase Bank, 021-000021 in favor of account number 9201060663, Westdeutsche Landesbank New York Branch, Reference: Delta EETC 2002-1, C LF. Section 3.05. Computations. All computations of interest based on the Base Rate shall be made on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the LIBOR Rate shall be made on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable. Section 3.06. Payment on Non-Business Days. Whenever any payment to be made hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and no additional interest shall be due as a result (and if so made, shall be deemed to have been made when due). If any payment in respect of interest on an Advance is so deferred to the next succeeding Business Day, such deferral shall not delay the commencement of the next Interest Period for such Advance (if such Advance is a LIBOR Advance) or reduce the number of days for which interest will be payable on such Advance on the next interest payment date for such Advance. Section 3.07. Interest. (a) Subject to Sections 2.07 and 2.09, the Borrower shall pay, or shall cause to be paid, without duplication, interest on (i) the unpaid principal amount of each Advance from and including the date of such Advance (or, in the case of an Applied Provider Advance, from and including the date on which the amount thereof was withdrawn from the Class C Cash Collateral Account to pay interest on the Class C Certificates) to but excluding the date such principal amount shall be paid in full (or, in the case of an Applied Provider Advance, the date on which the Class C 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) that 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 the interest rate per annum for each day equal to the Applicable Liquidity Rate (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 to the maximum extent permitted by applicable law 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 absolute amount of interest that would have accrued (without additional interest thereon) if such otherwise applicable interest rate as set forth in this Section 3.07 had at all relevant times been in effect. Nothing contained in this Section 3.07 shall require the Borrower to pay any amount under this Section 3.07 other than to the extent the Borrower shall have funds available therefor. (b) Except as provided in Section 3.07(e), each Advance will be either a Base Rate Advance or a LIBOR Advance as provided in this Section 3.07. Each such Advance will be a Base Rate Advance for the period from the date of its borrowing to (but excluding) the third Business Day following the 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, pursuant to Section 2.06, such Final Advance is deemed to have been made without delivery of a Notice of Borrowing, by requesting, prior to 11:00 a.m. 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 Provider Advance shall bear interest in an amount equal to the Investment Earnings on amounts on deposit in the Class C Cash Collateral Account for such Unapplied Provider Advance on the amount of such Unapplied Provider 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. (g) Each change in the Base Rate shall become effective immediately. The rates of interest specified in this Section 3.07 with respect to any Advance or other amount shall be referred to as the "Applicable Liquidity Rate". Section 3.08. Replacement of Borrower. Subject to Section 5.02, from time to time and subject to the successor Borrower's meeting the eligibility requirements set forth in Section 6.09 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 (a "Notice of Replacement Subordination Agent") delivered to the Liquidity Provider by the then Borrower, the successor Borrower designated therein shall become 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 the Applicable Margin or anticipated profits) incurred as a result of: (1) Any repayment of a LIBOR Advance on a date other than the last day of the Interest Period for such Advance; or (2) Any failure by the Borrower to borrow a LIBOR Advance on the date for borrowing specified in the relevant notice under Section 2.02. Section 3.10. Illegality. Notwithstanding any other provision in this Agreement, if any change in any law, rule or regulation applicable to or binding on the Liquidity Provider, 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 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 to maintain or fund its LIBOR Advances, then upon notice to the Borrower and Delta 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 reasonable judgment of the Liquidity Provider, requires immediate conversion; 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 will notify the Borrower and Delta as promptly as practicable of any event that will lead to the conversion of LIBOR Advances to Base Rate Advances under this Section 3.10. The Liquidity Provider agrees to investigate all commercially reasonable alternatives for avoiding the need for such conversion, including, without limitation, designating a different Lending Office, if such designation or other action would avoid the need to convert such LIBOR Advances to Base Rate Advances; provided, that the foregoing shall not obligate the Liquidity Provider to take any action that would, in its reasonable judgment, cause the Liquidity Provider to incur any material loss or cost, unless the Borrower or Delta agrees to reimburse the Liquidity Provider therefor. If no such designation or other action is effected, or, if effected, fails to avoid the need for conversion of the LIBOR Advances to Base Rate Advances, Delta may arrange for a Replacement Liquidity Facility in accordance with Section 3.06(e) of the Intercreditor Agreement. 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 by the appropriate party or parties): (a) The Liquidity Provider shall have received on or before the Closing Date 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; (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 and the Intercreditor Agreement); (iv) A copy of the Prospectus Supplement and specimen copies of the Class C Certificates; (v) An executed copy of each document, instrument, certificate and opinion delivered on or before the Closing Date pursuant to the Class C Trust Agreement, the Intercreditor Agreement and the other Operative Agreements (in the case of each such opinion, 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); and (vi) An agreement from Delta, pursuant to which (x) Delta agrees to provide copies of quarterly financial statements and audited annual financial statements to the Liquidity Provider (which Delta may provide in an electronic format by electronic mail or making such available over the internet) and (y) Delta agrees to allow the Liquidity Provider to discuss the transactions contemplated by the Operative Agreements with officers and employees of Delta. (b) On and as of the Effective Date no event shall have occurred and be 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 filings referred to in Sections 3.01(d) and 3.01(f) of the Participation Agreements shall have been filed (or shall be in the process of being filed). (d) The Liquidity Provider shall have received payment in full of the fees and other sums required to be paid to or for the account of the Liquidity Provider on or prior to the Effective Date pursuant to the Fee Letter. (e) All conditions precedent to the issuance of the Certificates under the Trust Agreement shall have been satisfied or waived, all conditions precedent to the effectiveness of the other Liquidity Facilities shall have been satisfied or waived, and all conditions precedent to the purchase of the Certificates by the Underwriters under the Underwriting Agreement shall have been satisfied (unless any of such conditions precedent under the Underwriting Agreement shall have been waived by the Underwriters), and all conditions precedent to the purchase of the Class D Certificates by the Initial Class D Holder shall have been satisfied. (f) The Borrower and Delta shall have received a certificate, dated the Effective Date signed by a duly authorized representative of the Liquidity Provider, certifying that all conditions precedent specified in this Section 4.01 have been satisfied or waived by the Liquidity Provider. 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, prior to the time of such Borrowing, the Borrower shall have delivered a Notice of Borrowing which conforms to the terms and conditions of this Agreement. 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 Agreements. Punctually pay or cause to be paid all amounts payable by it under this Agreement and the Intercreditor Agreement and observe and perform in all material respects the conditions, covenants and requirements applicable to it contained in this Agreement and the Intercreditor Agreement. (b) Reporting Requirements. Furnish to the Liquidity Provider with reasonable promptness, such other information and data with respect to the transactions contemplated by the Operative Agreements as from time to time may be reasonably requested by the 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, copies of 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. Subject to the first and fourth paragraphs of Section 7.01(a) of the Intercreditor Agreement and Section 7.01(b) of the Intercreditor Agreement, 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 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) this Agreement to expire at the close of business 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 3.06(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, all Advances, 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. 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 Borrower and the Liquidity Provider and any other Person whose consent is required pursuant to this Agreement; provided that no such change or other action relating to payment terms (including timing of any payments) shall affect the payment obligations of Delta without Delta's prior written consent; and any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given. Section 7.02. Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: If to the Borrower, to: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION 225 Asylum Street, Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Telecopy: (860) 244-1881 If to the Liquidity Provider, to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Transportation Finance Telephone: (212) 852-6111 Telecopy: (212) 869-7634 With a copy to: WESTDEUTSCHE LANDESBANK GIROZENTRALE 1211 Avenue of the Americas New York, New York 10036 Attention: Loan Administration Telephone: (212) 852-6323 Telecopy: (212) 302-7946 Any party, by notice to the other party hereto, may designate additional or different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 7.02. 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 4.02 of the Participation Agreements. In addition, the Borrower agrees to indemnify, protect, defend and hold harmless each Liquidity Indemnitee from and against all Expenses of any kind or nature whatsoever (other than any Expenses of the nature described in Sections 3.01 or 7.07 or in the Fee Letter (regardless of whether indemnified against pursuant to said Sections or in such Fee Letter)), that may be imposed on or incurred by such 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 Participation 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 negligence or willful misconduct of such Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) an ordinary and usual operating overhead expense, (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 or any other Operative Agreement to which it is a party or (iv) otherwise excluded from the indemnification provisions contained in Section 4.02 of the Participation Agreements. The provisions of Sections 3.01, 3.03, 3.09, 7.05 and 7.07 and the indemnities contained in Section 4.02 of the Participation Agreements 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 or directors 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 that were the result of (A) the Liquidity Provider's willful misconduct or gross 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 or the Intercreditor 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 complying with the terms and conditions hereof. (b) Neither the Liquidity Provider nor any of its officers, employees or directors or affiliates shall be liable or responsible in any respect for (i) any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with this Agreement or any Notice of Borrowing delivered hereunder or (ii) any action, inaction or omission which may be taken by it in good faith, absent willful misconduct or negligence (in which event the extent of the Liquidity Provider's potential liability to the Borrower shall be limited as set forth in the immediately preceding paragraph), in connection with this Agreement or any Notice of Borrowing. Section 7.07. Certain Costs and Expenses. The Borrower agrees promptly to pay, or cause to be paid, (a) the reasonable fees, expenses and disbursements of Milbank, Tweed, Hadley & McCloy LLP, special counsel for the Liquidity Provider, in connection with the preparation, negotiation, execution, delivery, filing and recording of the Operative Agreements, any waiver or consent thereunder or any amendment thereof and (b) if a Liquidity Event of Default occurs, all out-of-pocket expenses incurred by the Liquidity Provider, including reasonable fees and disbursements of counsel, in connection with such Liquidity Event of Default and any collection, bankruptcy, insolvency and other enforcement proceedings in connection therewith. In addition, the Borrower shall pay any and all recording, stamp and other similar taxes and fees payable or determined to be payable in the United States in connection with the execution, delivery, filing and recording of this Agreement, any other Operative Agreement and such other documents, and agrees to save the 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 permitted assigns, except that neither the Liquidity Provider (except as otherwise provided in this Section 7.08) nor (except as contemplated by Section 3.08) the Borrower shall have the right to assign, pledge or otherwise transfer its rights or obligations hereunder or any interest herein, subject to the Liquidity Provider's right to grant Participations pursuant to Section 7.08(b). (b) The Liquidity Provider agrees that it will not grant any participation (including, without limitation, a "risk participation") (any such participation, a "Participation") in or to all or a portion of its rights and obligations hereunder or under the other Operative Agreements, unless all of the following conditions are satisfied: (i) such Participation is to a Permitted Transferee, (ii) such Participation is made in accordance with all applicable laws, including, without limitation, the Securities Act of 1933, as amended, the Trust Indenture Act of 1939, as amended, and any other applicable laws relating to the transfer of similar interests and (iii) such Participation shall not be made under circumstances that require registration under the Securities Act of 1933, as amended, or qualification of any indenture under the Trust Indenture Act of 1939, as amended. Notwithstanding any such Participation, the Liquidity Provider agrees that (1) the Liquidity Provider's obligations under the Operative Agreements shall remain unchanged, and such participant shall have no rights or benefits as against Delta or the Borrower or under any Operative Agreement, (2) the Liquidity Provider shall remain solely responsible to the other parties to the Operative Agreements for the performance of such obligations, (3) the Liquidity Provider shall remain the maker of any Advances, and the other parties to the Operative Agreements shall continue to deal solely and directly with the Liquidity Provider in connection with the Advances and the Liquidity Provider's rights and obligations under the Operative Agreements, (4) the Liquidity Provider shall be solely responsible for any withholding Taxes or any filing or reporting requirements relating to such Participation and shall hold the Borrower and Delta and their respective successors, permitted assigns, affiliates, agents and servants harmless against the same and (5) neither Delta nor the Borrower shall be required to pay to the Liquidity Provider any amount under Section 3.01 or Section 3.03 greater than it would have been required to pay had there not been any grant of a Participation by the Liquidity Provider. The Liquidity Provider may, in connection with any Participation or proposed Participation pursuant to this Section 7.08(b), disclose to the participant or proposed participant any information relating to the Operative Agreements or to the parties thereto furnished to the Liquidity Provider thereunder or in connection therewith and permitted to be disclosed by the Liquidity Provider; provided, however, that prior to any such disclosure, the participant or proposed participant shall agree in writing for the express benefit of the Borrower and Delta to preserve the confidentiality of any confidential information included therein (subject to customary exceptions). (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 or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 7.10. Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity. (a) Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof hereby (i) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (ii) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. (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) The Liquidity Provider hereby waives any immunity it may have from the jurisdiction of the courts of the United States or of any state thereof and waives any immunity any of its properties located in the United States may have from attachment or execution upon a judgment entered by any such court under the United States Foreign Sovereign Immunities Act of 1976 or any similar successor legislation. Section 7.12. Counterparts. This Agreement may be executed in any number of counterparts (and each party shall not be required to execute the same counterpart). Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts together shall constitute one instrument. Section 7.13. Entirety. This Agreement and the Intercreditor Agreement constitute the entire agreement of the parties hereto with respect to the subject matter hereof and supersede all prior understandings and agreements of such parties. Section 7.14. 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 7.15. 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 ABSOLUTE, UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first set forth above. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Subordination Agent, as agent and trustee for the Class C Trust, as Borrower By: ----------------------------------------- Name: Title: WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: ----------------------------------------- Name: Title: By: ----------------------------------------- Name: Title: ANNEX I to REVOLVING CREDIT AGREEMENT INTEREST ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1C), dated as of April 30, 2002, 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 for the payment of the interest on the Class C Certificates which is payable on ____________, ____ (the "Distribution Date") in accordance with the terms and provisions of the Class C Trust Agreement and the Class C Certificates, which Advance is requested to be made on ____________, ____. The Interest Advance should be remitted to [insert wire and account details]. (3) The amount of the Interest Advance requested hereby (i) is $_______________.__, to be applied in respect of the payment of the interest which is due and payable on the Class C Certificates on the Distribution Date, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class C Certificates, the Class G-1 Certificates, the Class G-2 Certificates, the Class D Certificates, or interest on the Class G-1 Certificates or the Class G-2 Certificates, or the Class D Certificates (iii) was computed in accordance with the provisions of the Class C Certificates, or the Class C 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, and (v) has not been and is not the subject of a prior or contemporaneous Notice of Borrowing. (4) Upon receipt by or on behalf of the Borrower of the amount requested hereby, (a) the Borrower will apply the same in accordance with the terms of Section 3.06(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 Certificate and such reduction shall automatically result in corresponding reductions in the amounts available to be borrowed pursuant to a subsequent Advance. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ----------------------------------------- Name: Title: SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Interest Advance Notice of Borrowing] ANNEX II to REVOLVING CREDIT AGREEMENT NON-EXTENSION ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1C), dated as of April 30, 2002, 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 C Cash Collateral Account in accordance with Section 3.06(d) of the Intercreditor Agreement, which Advance is requested to be made on __________, ____. The Non-Extension Advance should be remitted to [insert wire and account details]. (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 C Cash Collateral Account in accordance with Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class C Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class G-2 Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class C Certificates, the Class C 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 C Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(d) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Non-Extension Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ----------------------------------------- Name: Title: SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Non-Extension Advance Notice of Borrowing] ANNEX III to REVOLVING CREDIT AGREEMENT DOWNGRADE ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned subordination agent (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1C), dated as of April 30, 2002, 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 C Cash Collateral Account in accordance with Section 3.06(c) of the Intercreditor Agreement by reason of the downgrading of the short-term rating or long-term rating of the Liquidity Provider issued by either Rating Agency below the Threshold Rating, which Advance is requested to be made on __________, ____. The Downgrade Advance should be remitted to [insert wire and account details]. (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 C Cash Collateral Account in accordance with Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of the principal of, or premium on, the Class C Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class G-2 Certificates, or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class C Certificates, the Class C 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 C Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(c) and 3.06(f) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Downgrade Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ----------------------------------------- Name: Title: SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING [Insert Copy of computations in accordance with Downgrade Advance Notice of Borrowing] ANNEX IV to REVOLVING CREDIT AGREEMENT FINAL ADVANCE NOTICE OF BORROWING The undersigned, a duly authorized signatory of the undersigned borrower (the "Borrower"), hereby certifies to Westdeutsche Landesbank Girozentrale, New York Branch (the "Liquidity Provider"), with reference to the Revolving Credit Agreement (2002-1C), dated as of April 30, 2002, 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 C Cash Collateral Account in accordance with Section 3.06(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 ____________, ____. The Final Advance should be remitted to [insert wire and account details]. (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 C Cash Collateral Account in accordance with Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (ii) does not include any amount with respect to the payment of principal of, or premium on, the Class C Certificates, or principal of, or interest or premium on, the Class G-1 Certificates, the Class G-2 Certificates or the Class D Certificates, (iii) was computed in accordance with the provisions of the Class C Certificates, the Class C 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 C Cash Collateral Account and apply the same in accordance with the terms of Sections 3.06(f) and 3.06(i) of the Intercreditor Agreement, (b) no portion of such amount shall be applied by the Borrower for any other purpose and (c) no portion of such amount until so applied shall be commingled with other funds held by the Borrower. (5) [The Borrower hereby requests that the Advance requested hereby be a Base Rate Advance [and that such Base Rate Advance be converted into a LIBOR Advance on the third Business Day following your receipt of this notice]*.] The Borrower hereby acknowledges that, pursuant to the Liquidity Agreement, (A) the making of the Final Advance as requested by this Notice of Borrowing shall automatically and irrevocably terminate the obligation of the 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. IN WITNESS WHEREOF, the Borrower has executed and delivered this Notice of Borrowing as of the ____ day of _________, ____. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ----------------------------------------- Name: Title: [* Bracketed language may be included at Borrower's option.] SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING [Insert Copy of Computations in accordance with Final Advance Notice of Borrowing] ANNEX V to REVOLVING CREDIT AGREEMENT NOTICE OF TERMINATION [Date] State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as Borrower 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Air Lines Pass Through Trust 2002-1C, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 and continuance of a Liquidity Event of Default and the existence of a Performing Note Deficiency (each as defined therein), we are giving this notice to you in order to cause (i) our obligations to make Advances (as defined therein) under such Liquidity Agreement to terminate at the close of business 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 3.06(i) of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a consequence of your receipt of this notice. THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY AGREEMENT WILL TERMINATE AT THE CLOSE OF BUSINESS ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU RECEIVE THIS NOTICE. Very truly yours, WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as Liquidity Provider By: ------------------------------------------- Name: Title: cc: State Street Bank and Trust Company of Connecticut, National Association, as Class C Trustee ANNEX VI to REVOLVING CREDIT AGREEMENT NOTICE OF REPLACEMENT SUBORDINATION AGENT [Date] Attention: Re: Revolving Credit Agreement, dated as of April 30, 2002, between State Street Bank and Trust Company of Connecticut, National Association, as Subordination Agent, as agent and trustee for the Delta Airlines Pass Through Trust 2002-1C, as Borrower, and Westdeutsche Landesbank Girozentrale, 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 7.01 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. This transfer shall be effective as of [specify time and date]. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent, as Borrower By: ----------------------------------------- Name: Title: EX-4.(D)(1) 10 de763576-ex4d1.txt FGI POLICY Exhibit 4(d)(1) MBIA INSURANCE CORPORATION FINANCIAL GUARANTY INSURANCE POLICY April 30, 2002 Policy No. 37923(2) Re: Delta Air Lines Pass Through Trust 2002-1G-1 (the "Class G-1 Trust") $370,286,000 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-1 (the "Class G-1 Certificates") Insured Payment of interest at the Stated Interest Rate for the Obligation: Class G-1 Certificates and principal on the Class G-1 Certificates. Beneficiary: State Street Bank and Trust Company of Connecticut, National Association, as subordination agent (together with any successor subordination agent duly appointed and qualified under the Agreement (as defined below) the "Subordination Agent") MBIA INSURANCE CORPORATION ("MBIA"), for consideration received, hereby unconditionally, absolutely and irrevocably and without the assertion of any defenses to payment, including fraud in the inducement or fact or any other circumstances (other than payment in full) that would have the effect of discharging a surety in law or in equity guarantees to the Subordination Agent, subject only to the terms of this Policy (the "Policy"), payment of the Insured Obligation. MBIA agrees to pay to the Subordination Agent, in respect of each Distribution Date, an amount equal to (each a "Deficiency Amount"): (i) with respect to any Regular Distribution Date other than the Final Legal Distribution Date, any shortfall in amounts available to the Subordination Agent, after giving effect to the subordination provisions of the Agreement and the application of any drawing paid under the Class G-1 Liquidity Facility in respect of interest due on the Class G-1 Certificates on such Distribution Date and any withdrawal from the Class G-1 Cash Collateral Account in respect of interest due on the Class G-1 Certificates on such Distribution Date in accordance with the Agreement, for the payment of accrued and unpaid interest on the Class G-1 Certificates, in each case at the Stated Interest Rate for the Class G-1 Certificates on the Pool Balance of the Class G-1 Certificates on such Distribution Date; (ii) with respect to any Special Distribution Date (other than a Special Distribution Date established pursuant to the succeeding clause (iv) below) established by reason of receipt of a Special Payment constituting the proceeds of any Series G-1 Equipment Notes (as to which there has been a default in the payment of principal thereof or that has been accelerated) or the related Indenture Estate or Collateral, as the case may be, any shortfall in the amounts available to the Subordination Agent after giving effect to the subordination provisions of the Agreement and, if such Special Payment is received prior to a Policy Provider Election with respect to such Series G-1 Equipment Note, the application of any drawing paid under the Class G-1 Liquidity Facility in respect of interest due on the Class G-1 Certificates on such Distribution Date and any withdrawal from the Class G-1 Cash Collateral Account in respect of interest due on such Distribution Date in accordance with the Agreement, required to reduce the Pool Balance of the Class G-1 Certificates by an amount equal to the outstanding principal amount of such Series G-1 Equipment Note (determined immediately prior to the receipt of such proceeds and less the amount of any drawings previously paid by MBIA in respect of principal on such Series G-1 Equipment Note) plus accrued and unpaid interest on the amount of such reduction at the Stated Interest Rate for the Class G-1 Certificates from the period from the immediately preceding Regular Distribution Date to such Special Distribution Date; (iii) with respect to the Special Distribution Date established by reason of the failure of the Subordination Agent to have received a Special Payment constituting the proceeds of any Series G-1 Equipment Note or the related Indenture Estate or Collateral, as the case may be, during the eighteen (18) month period beginning on the last date on which full payment was made on such Series G-1 Equipment Note (the date of such payment in full, the "Last Payment Date") as to which there has been a failure to pay principal or that has been accelerated subsequent to the Last Payment Date, the amount equal to the outstanding principal amount of such Series G-1 Equipment Note plus accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-1 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date; provided, however, if MBIA shall have duly given a Policy Provider Election (as defined below) with respect to such Series G-1 Equipment Note at the end of such eighteen (18) month period and at least five (5) days prior to such Special Distribution Date, the Deficiency Amount shall be an amount equal to (A) with respect to such Special Distribution Date the scheduled principal and interest payable but not paid on such Series G-1 Equipment Note (without regard to the acceleration thereof) during such eighteen (18) month period (after giving effect to the application of any drawing paid under the Class G-1 Liquidity Facility and any withdrawal from the Class G-1 Cash Collateral Account attributable to such interest on such Series G-1 Equipment Note) and (B) thereafter, on each Regular Distribution Date following such Special Distribution Date as to which a Policy Provider Election has been given in respect of such Series G-1 Equipment Note, and prior to the establishment of an Election Distribution Date or a Special Distribution Date pursuant to the immediately succeeding clause (iv) with respect to such Series G-1 Equipment Note, an amount equal to the scheduled principal (without regard to the acceleration thereof) and interest payable on such Series G-1 Equipment Note on the related payment date; (iv) following the giving of any Policy Provider Election, with respect to any Business Day elected by MBIA upon twenty (20) days prior notice (which shall be a Special Distribution Date) and upon request by MBIA to the Subordination Agent to make a drawing under this Policy, an amount equal to the then outstanding principal balance of the Series G-1 Equipment Note as to which the Policy Provider Election was given (less any drawings previously paid by MBIA in respect of principal on such Series G-1 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-1 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date; (v) with respect to any Special Distribution Date which is an Election Distribution Date, an amount equal to the then outstanding principal balance of the Series G-1 Equipment Note as to which such Election Distribution Date relates (less any drawing previously paid by MBIA in respect of principal of such Series G-1 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-1 Certificates from the immediately preceding Regular Distribution Date to such Election Distribution Date; and (vi) with respect to the Final Legal Distribution Date, any shortfalls in amounts available to the Subordination Agent after giving effect to the subordination provisions of the Agreement and to the application of any drawing paid under the Class G-1 Liquidity Facility in respect of interest included in the Final Distribution and any withdrawal from the Class G-1 Cash Collateral Account in respect of interest included in the Final Distribution in accordance with the Agreement, for the payment in full of the Final Distribution (calculated as of such date but excluding any accrued and unpaid premium) on the Class G-1 Certificates. For the avoidance of doubt, no Deficiency Amount described in clauses (i)-(vi) above or payment to be made in respect of an Avoided Payment described below shall constitute an accelerated or acceleration payment. If any amount paid or required to be paid in respect of the Insured Obligation is voided (a "Preference Event") under any applicable bankruptcy, insolvency, receivership or similar law in an Insolvency Proceeding, and, as a result of such a Preference Event, the Beneficiary, the Class G-1 Trustee or any Class G-1 Certificateholder is required to return such voided payment, or any portion of such voided payment made or to be made in respect of the Class G-1 Certificates (including any disgorgement from the Class G-1 Certificateholders resulting from any such Insolvency Proceeding, whether such disgorgement is determined on a theory of preferential conveyance or otherwise) (an "Avoided Payment"), MBIA will pay an amount equal to each such Avoided Payment, irrevocably, absolutely and unconditionally and without the assertion of any defenses to payment, including fraud in inducement or fact or any other circumstances that would have the effect of discharging a surety in law or in equity, upon receipt by MBIA from the Beneficiary, the Class G-1 Trustee or such Class G-1 Certificateholder of (x) a certified copy of a final (non-appealable) order of a court exercising jurisdiction in such Insolvency Proceeding to the effect that the Beneficiary, the Class G-1 Trustee or such Class G-1 Certificateholder is required to return any such payment or portion thereof because such payment was voided under applicable law, with respect to which order the appeal period has expired without an appeal having been filed (the "Final Order"), (y) an assignment, in the form of Exhibit D hereto, irrevocably assigning to MBIA all rights and claims of such Beneficiary, the Class G-1 Trustee or such Class G-1 Certificateholder relating to or arising under such Avoided Payment and (z) a Notice of Avoided Payment in the form of Exhibit B hereto appropriately completed and executed by the Beneficiary, the Class G-1 Trustee or such Class G-1 Certificateholder. Such payment shall be disbursed to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order and not to the Beneficiary, the Class G-1 Trustee or such Class G-1 Certificateholder directly unless such Beneficiary, Class G-1 Trustee or Class G-1 Certificateholder has returned such payment to such receiver, conservator, debtor-in-possession or trustee in bankruptcy, in which case such payment shall be disbursed to such Class G-1 Certificateholder, the Class G-1 Trustee or the Beneficiary, as the case may be. Notwithstanding the foregoing, in no event shall MBIA be obligated to make any payment in respect of any Avoided Payment, which payment represents a payment of the principal amount of the Class G-1 Certificates, prior to the time MBIA would have been required to make a payment in respect of such principal pursuant to sub-paragraphs (ii)-(vi) of this Policy; provided, further, that no payment of principal under this Policy on any Distribution Date, other than with respect to an Avoided Payment, shall exceed the Net Principal Policy Amount (as defined below) for such Distribution Date; provided, further, that no payment, other than with respect to an Avoided Payment, of a Deficiency Amount shall be in excess of the then outstanding Pool Balance of the Class G-1 Certificates and accrued and unpaid interest thereon at the Stated Interest Rate on the Class G-1 Certificates. This Policy does not cover (i) any premium, prepayment penalty or other accelerated payment, which at any time may become due on or with respect to any Class G-1 Certificate, (ii) shortfalls, if any, attributable to the liability of the Subordination Agent, the Class G-1 Trust or the Class G-1 Trustee for withholding taxes, if any (including interest and penalties in respect of any such liability) or (iii) any failure of the Subordination Agent or the Class G-1 Trustee to make any payment due to the Class G-1 Certificateholders from funds received. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Intercreditor Agreement (the "Agreement"), dated as of April 30, 2002, among MBIA, as Policy Provider, State Street Bank and Trust Company of Connecticut, National Association, as Trustee of the Trusts, Westdeutsche Landesbank Girozentrale, New York Branch, as Liquidity Provider, and the Subordination Agent, without regard to any amendment or supplement thereto unless such amendment or supplement has been executed, or otherwise approved in writing, by MBIA. "Business Day" shall mean any day other than a Saturday, a Sunday or other day on which insurance companies in New York, New York or commercial banking institutions in the cities in which the corporate trust office of the Subordination Agent, the Fiscal Agent (as defined herein) or the office of MBIA specified in this Policy are located are authorized or obligated by law or executive order to close. "Class G-1 Certificateholder" shall mean any person who is the registered owner or beneficial owner of any of the Class G-1 Certificates and who, on the applicable Distribution Date, is entitled under the terms of the Class G-1 Certificates to payment thereunder. "Election Distribution Date" shall mean any Special Distribution Date established by the Subordination Agent upon 20 days' notice to the Class G-1 Trustee and the Policy Provider by reason of the occurrence and continuation of a Policy Provider Default occurring after a Policy Provider Election. "Final Legal Distribution Date" shall mean January 2, 2014. "Indenture Estate" shall have the meaning given such term in the Indenture for any Leased Aircraft. "Insolvency Proceeding" means the commencement, after the date hereof, of any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of assets and liabilities or similar proceedings by or against Delta Air Lines, Inc., any Liquidity Provider or any Owner Trustee and the commencement, after the date hereof, of any proceedings by Delta Air Lines, Inc., any Liquidity Provider, or any Owner Trustee for the winding up or liquidation of its affairs or the consent, after the date hereof, to the appointment of a trustee, conservator, receiver, or liquidator in any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of assets and liabilities or similar proceedings of or relating to Delta Air Lines, Inc., any Liquidity Provider, or any Owner Trustee. "Insurance Agreement" shall mean the Insurance and Indemnity Agreement (as may be amended, modified or supplemented from time to time), dated as of April 30, 2002, by and among MBIA, Delta Air Lines, Inc., the Class G-1 Trustee, the Class G-2 Trustee and the Subordination Agent. "Insured Amounts" shall mean, with respect to any Distribution Date, the Deficiency Amount for such Distribution Date. "Net Principal Policy Amount" shall mean the Pool Balance of the Class G-1 Certificates as of the Closing Date minus all amounts previously drawn on this Policy with respect to principal. "Nonpayment" shall mean, with respect to any Distribution Date, a Deficiency Amount owing to the Subordination Agent for distribution to the Class G-1 Certificateholders in respect of such Distribution Date. "Notice of Avoided Payment" shall mean the notice, substantially in the form of Exhibit B hereto, delivered pursuant to this Policy and sent to the contact person at the address and/or fax number set forth in this Policy, and specifying the Avoidance Payment which shall be due and owing on the applicable Distribution Date. "Notice of Nonpayment" shall mean the notice, substantially in the form of Exhibit A hereto, delivered pursuant to this Policy and sent to the contact person at the address and/or fax numbers set forth in this Policy specifying the Insured Amount which shall be due and owing to the Class G-1 Trustee for distribution to the Class G-1 Certificateholders on the applicable Distribution Date. "Policy Provider Election" shall mean a notice given by MBIA when no Policy Provider Default shall have occurred and be continuing, stating that MBIA elects to make payments of Deficiency Amounts as defined under the proviso to clause (iii) of the definition of Deficiency Amount in respect of any Series G-1 Equipment Note in lieu of applying clause (iii) (without the proviso) of the definition of Deficiency Amount, which notice shall be given to the Subordination Agent not less than five (5) days prior to the Special Distribution Date established for payment of a Deficiency Amount under clause (iii) of the definition thereof. "Trust Agreement" shall mean the Pass Through Trust Agreement, dated as of November 16, 2000, between Delta Air Lines, Inc. and State Street Bank and Trust Company of Connecticut, National Association, as Trustee, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, between the same parties, pursuant to which the Class G-1 Certificates have been issued. Payment of amounts hereunder shall be made in immediately available funds (x) with respect to Deficiency Amounts no later than 3:00 p.m., New York City time, on the later of (a) the relevant Distribution Date and (b) the Business Day of presentation to State Street Bank and Trust Company, N.A., as fiscal agent for MBIA or any successor fiscal agent appointed by MBIA (the "Fiscal Agent"), of a Notice of Nonpayment, appropriately completed and executed by the Beneficiary (if such Notice of Nonpayment is received by 1:00 p.m. on such day), and (y) with respect to Avoided Payments, prior to 3:00 p.m. New York City time, on the third Business Day following MBIA's receipt of the documents required under clauses (x) through (z) of the third paragraph of this Policy. Any such documents received by MBIA after 1:00 p.m. New York City time on any Business Day or on any day that is not a Business Day shall be deemed to have been received by MBIA prior to 1:00 p.m. on the next succeeding Business Day. All payments made by MBIA hereunder in respect of Avoided Payments will be made with MBIA's own funds. A Notice of Nonpayment or Notice of Avoided Payment under this Policy may be presented to the Fiscal Agent on any Business Day by (a) delivery of the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its address set forth below, or (b) facsimile transmission of the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its facsimile number set forth below. If presentation is made by facsimile transmission, the Beneficiary shall (i) simultaneously confirm transmission by telephone to the Fiscal Agent at its telephone number set forth below, and (ii) as soon as reasonably practicable, deliver the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its address set forth below. Each Notice of Nonpayment or Notice of Avoided Payment shall be delivered by facsimile and mail to MBIA simultaneously with its delivery to the Fiscal Agent. If any Notice of Nonpayment or Notice of Avoided Payment received by the Fiscal Agent is not in proper form or is otherwise insufficient for the purpose of making a claim hereunder, it shall be deemed not to have been received by the Fiscal Agent, and MBIA or the Fiscal Agent, as the case may be, shall promptly so advise the Beneficiary, and the Beneficiary may submit an amended Notice of Nonpayment or Notice of Avoided Payment, as the case may be. Payments due hereunder unless otherwise stated herein will be disbursed by the Fiscal Agent to the Subordination Agent for the benefit of the Class G-1 Certificateholders by wire transfer of immediately available funds in the amount of such payment. Other than amounts payable in respect of Avoided Payments, MBIA's obligations under this Policy shall be discharged to the extent funds to be applied to pay the Insured Obligations under and in accordance with the Intercreditor Agreement are received by the Subordination Agent (including funds disbursed by MBIA as provided in this Policy and received by the Subordination Agent) for the Class G-1 Trust whether or not such funds are properly applied by the Subordination Agent, the Paying Agent or the Class G-1 Trustee. MBIA's obligations to make payments in respect of any Avoided Payments shall be discharged to the extent such payments are made by MBIA hereunder and are received by the Subordination Agent, the Class G-1 Trustee, the applicable Class G-1 Certificateholder or the receiver, conservator, debtor-in-possession or trustee in bankruptcy as applicable, whether or not such payments are properly applied by the Subordination Agent or the Class G-1 Trustee. The Fiscal Agent is the agent of MBIA only, and the Fiscal Agent shall in no event be liable to Class G-1 Certificateholders for any acts of the Fiscal Agent or any failure of MBIA to deposit or cause to be deposited sufficient funds to make payments due under this Policy. Any notice hereunder delivered to the Fiscal Agent of MBIA may be made at the address listed below for the Fiscal Agent of MBIA or such other address as MBIA shall specify in writing to the Subordination Agent. The notice address of the Fiscal Agent is 61 Broadway, 15th Floor, New York, New York 10006, Attention: Municipal Registrar and Paying Agency, Facsimile: (212) 612-3201, Telephone: (212) 612-3458. All notices, presentations, transmissions, deliveries and communications made by the Beneficiary to MBIA with respect to this Policy shall specifically refer to the number of this Policy and shall be made to MBIA at: MBIA Insurance Corporation 113 King Street Armonk, NY 10504 Attention: Insured Portfolio Management, Structured Finance Telephone: (914) 273-4949 Facsimile: (914) 765-3163 or such other address, telephone number or facsimile number as MBIA may designate to the Beneficiary in writing from time to time. Each such notice, presentation, transmission, delivery and communication shall be effective only upon actual receipt by MBIA. To the extent and in the manner specified in the Intercreditor Agreement for the Class G-1 Trust, MBIA shall be subrogated to the rights of each Class G-1 Certificateholder to receive payments under the Class G-1 Certificates to the extent of any payment made by it hereunder. This Policy is neither transferable nor assignable, in whole or in part, except to a successor Subordination Agent duly appointed and qualified under the Agreement. Such transfer and assignment shall be effective upon receipt by MBIA of a copy of the instrument effecting such transfer and assignment signed by the transferor and by the transferee, and a certificate, properly completed and signed by the transferor and the transferee, in the form of Exhibit C hereto (which shall be conclusive evidence of such transfer and assignment), and, in such case, the transferee instead of the transferor shall, without the necessity of further action, be entitled to all the benefits of and rights under this Policy in the transferor's place, provided that, in such case, the Notice of Nonpayment presented hereunder shall be a certificate of the transferee and shall be signed by one who states therein that he is a duly authorized officer of the transferee. There shall be no acceleration payment due under this Policy unless such acceleration is at the sole option of MBIA. This Policy shall terminate and the obligations of MBIA hereunder shall be discharged on the day (the "Termination Date") which is one year and one day following the Distribution Date upon which the Final Distribution on the Class G-1 Certificates is made. The foregoing notwithstanding, if an Insolvency Proceeding is existing during the one year and one day period set forth above, then this Policy and MBIA's obligations hereunder shall terminate on the later of (i) the date of the conclusion or dismissal of such Insolvency Proceeding without continuing jurisdiction by the court in such Insolvency Proceeding, and (ii) the date on which MBIA has made all payments required to be made under the terms of this Policy in respect of Avoided Payments. This Policy is not covered by the property/casualty insurance fund specified in Article Seventy-Six of the New York State insurance law. This Policy sets forth in full the undertaking of MBIA, and, except as expressly provided in the Insurance Agreement and the Agreement, shall not be modified, altered or affected by any other agreement or instrument, including any modification or amendment to any other agreement or instrument, or by the merger, consolidation or dissolution of Delta Air Lines, Inc. or any other Person and may not be canceled or revoked by MBIA prior to the time it is terminated in accordance with the express terms hereof. The Premium on this Policy is not refundable for any reason. This Policy shall be returned to MBIA upon termination. THIS POLICY SHALL BE CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. IN WITNESS WHEREOF, MBIA has caused this Policy to be duly executed on the date first written above. MBIA INSURANCE CORPORATION By: ___________________________________ Name: Title: By: ___________________________________ Name: Title: Exhibit A to Policy Number 37923(1) NOTICE OF NONPAYMENT AND DEMAND FOR PAYMENT OF INSURED AMOUNTS Date: [____________] MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance State Street Bank and Trust Company, N.A. 61 Broadway, 15th Floor New York, New York 10006 Attention: Municipal Registrar and Paying Agency Reference is made to Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-1. Terms capitalized herein and not otherwise defined shall have the meanings ascribed to such terms in or pursuant to the Policy unless the context otherwise requires. The Subordination Agent hereby certifies as follows: 1. The Subordination Agent is the trustee for the Class G-1 Trust under the Class G-1 Trust Agreement. 2. The relevant Distribution Date is __________. Such Distribution Date is a [Regular Distribution Date, a Special Distribution Date, an Election Distribution Date or the Final Legal Distribution Date]. [3. Payment of accrued and unpaid interest on the Class G-1 Certificates at the Stated Interest Rate on the outstanding Pool Balance of the Class G-1 Certificates accrued to the Distribution Date which is a Regular Distribution Date as determined pursuant to paragraph (i) of the definition of "Deficiency Amount" in the Policy is an amount equal to $_____________.] [3. The amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (ii) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of a reduction in the outstanding Pool Balance of such Class G-1 Certificates and accrued and unpaid interest on the amount of such reduction at the Stated Interest Rate for the Class G-1 Certificates is $____________.] [3. The Subordination Agent has not received a timely Policy Provider Election pursuant to the Policy and the amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (iii) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of the outstanding principal amount of the relevant Series G-1 Equipment Note(s) and accrued and unpaid interest accrued thereon at the Stated Interest Rate for the Class G-1 Certificates is $________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy and the amount determined for payment to the Class G-1 Certificateholders pursuant to the provision in paragraph (iii)(A) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of scheduled principal (without regard to acceleration thereof) and interest at the Stated Interest Rate for the Class G-1 Certificates payable but not paid on the relevant Series G-1 Equipment Note during the eighteen (18) month period referred to in such paragraph (iii) is $_________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy, no Election Distribution Date has been established pursuant to the Policy or Special Distribution Date established pursuant to clause (iv) of the definition of "Deficiency Amount" and the amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (iii)(B) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Regular Distribution Date in respect of scheduled principal (without regard to acceleration thereof) and interest payable at the Stated Interest Rate for the Class G-1 Certificates due on the Regular Distribution Date on the relevant Series G-1 Equipment Note is $____________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy, the Special Distribution Date related hereto is a Business Day elected by MBIA upon 20 days prior notice and the amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (iv) of the definition of "Deficiency Amount" in the Policy in respect of outstanding principal on such Series G-1 Equipment Note (less any drawings previously paid by MBIA in respect of principal on such Series G-1 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-1 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date is $__________.] [3. The amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (v) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is an Election Distribution Date in respect of the outstanding principal balance of the relevant Series G-1 Equipment Note (less any drawings previously paid by MBIA in respect of principal on such Series G-1 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-1 Certificates from the immediately preceding Regular Distribution Date to such Election Distribution Date is $___________.] [3. The amount determined for payment to the Class G-1 Certificateholders pursuant to paragraph (vi) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is the Final Legal Distribution Date in respect of payment in full of the Final Distribution (other than premium) on the Class G-1 Certificates is $____________.] 4. The sum of $_________________ is the Insured Amount that is due. 5. The Subordination Agent has not heretofore made a demand for the Insured Amount in respect of such Distribution Date. 6. The Subordination Agent hereby requests payment of such Insured Amount that is due for payment be made by MBIA under the Policy and directs that payment under the Policy be made to the following account by bank wire transfer of federal or other immediately available funds in accordance with the terms of the Policy to: [____] ABA #: [_____] Acct #: [_____] FBO: [_____] [Class G-1 Policy Account number] 7. The Subordination Agent hereby agrees that, following receipt of the Insured Amount from MBIA, it shall (a) cause such funds to be deposited in the Class G-1 Policy Account and not permit such funds to be held in any other account, (b) cause such funds to be paid to the Class G-1 Trustee for distribution to the Class G-1 Certificateholders in reduction of the Pool Balance of, or interest on, the Class G-1 Certificates (as applicable) and not apply such funds for any other purpose and (c) maintain an accurate record of such payments with respect to the Class G-1 Certificates and the corresponding claim on the Policy and proceeds thereof. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By:___________________________________ Name: Title: Exhibit B to Policy Number 37923(1) NOTICE OF AVOIDED PAYMENT AND DEMAND FOR PAYMENT OF AVOIDED PAYMENTS Date: [____________] MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance State Street Bank and Trust Company, N.A. 61 Broadway, l5th Floor New York, New York 10006 Attention: Municipal Registrar and Paying Agency Reference is made to Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-1. Terms capitalized herein and not otherwise defined shall have the meanings ascribed to such terms in or pursuant to the Policy unless the context otherwise requires. The Subordination Agent hereby certifies as follows: 1. The Subordination Agent is the trustee for the Class G-1 Trustee under the Trust Agreement. 2. The Subordination Agent has established ______________ as a Special Distribution Date pursuant to the Agreement for amounts claimed hereunder. 3. A Final Order providing for the recovery of an Avoided Payment of $________________ has been issued. 4. $_________________ of the amount set forth in item No. 3 above has been paid by the [Class G-1 Certificateholder/Class G-1 Trustee/Subordination Agent] and $_________________ is required to be paid to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order. 5. The [Class G-1 Certificateholder/Class G-1 Trustee/Subordination Agent] has not heretofore made a demand for such Avoided Payment. 6. The [Class G-1 Certificateholder/Class G-1 Trustee/Subordination Agent] has delivered to MBIA or has attached hereto all documents required by the Policy to be delivered in connection with such Avoided Payment. 7. The [Class G-1 Certificateholder/Class G-1 Trustee/Subordination Agent] hereby requests that payment of $______________ of such Avoided Payment be made to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order and $________________ of such Avoided Payment be paid to the [Class G-1 Certificateholder] [Class G-1 Trustee] [Subordination Agent [for payment over to the Class G-1 Trustee] for distribution to the Class G-1 Certificateholder], in each case, by MBIA under the Policy and directs that payment under the Policy be made to the following account by bank wire transfer of federal or other immediately available funds in accordance with the terms of the Policy to: For the portion to be paid to the receiver, conservator, debtor-in-possession or trustee, to _________________________: ABA #: [_____] Acct #: [_____] FBO: [_____] [relevant account number] For the portion to be paid to the Subordination Agent: ABA #: [_____] Acct #: [_____] FBO: [_____] [Class G-1 Policy Account Number] [Name of Subordination Agent] By:______________________________________ Name: Title: (Officer) Exhibit C to Policy Number 37923(1) MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance Dear Sirs: Reference is made to that certain Policy, Number 37923(2), dated April 30, 2002 (the "Policy"), which has been issued by MBIA Insurance Corporation in favor of the Subordination Agent with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-1. The undersigned [Name of Transferor] has transferred and assigned (and hereby confirms to you said transfer and assignment) all of its rights in and under said Policy to [Name of Transferee] and confirms that [Name of Transferor] no longer has any rights under or interest in said Policy. Transferor and Transferee have indicated on the face of said Policy that it has been transferred and assigned to Transferee. Transferee hereby certifies that it is a duly authorized transferee under the terms of said Policy and is accordingly entitled, upon presentation of the document(s) called for therein, to receive payment thereunder. [Name of Transferor] By:____________________________________ [Name and Title of Authorized Officer of Transferor] Exhibit D to Policy Number 37923(1) Form of Assignment Reference is made to that certain Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") relating to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-1. Unless otherwise defined herein, capitalized terms used in this Assignment shall have the meanings assigned thereto in the Policy as incorporated by reference therein. In connection with the Avoided Payment of [$_________] paid by the undersigned (the "[Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary]") on [______] and the payment by MBIA in respect of such Avoided Payment pursuant to the Policy, the [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary] hereby irrevocably and unconditionally, without recourse, representation or warranty (except as provided below), sells, assigns, transfers, conveys and delivers to MBIA all of such [Class G-1 Certificateholder's/Class G-1 Trustee's/Beneficiary's] rights, title and interest in and to any rights or claims, whether accrued, contingent or otherwise, which the [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary] now has or may hereafter acquire, against any person relating to, arising out of or in connection with such Avoided Payment. The [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary] represents and warrants that such claims and rights are free and clear of any lien or encumbrance created or incurred by such [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary].(1) [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary] By:____________________________________ Name: Title: - ----------------------------- (1) In the event that the terms of this form of assignment are reasonably determined to be insufficient solely as a result of a change of law or applicable rules after the date of the Policy to fully vest all of the [Class G-1 Certificateholder's/Class G-1 Trustee's/Beneficiary's] right, title and interest in such rights and claims, the [Class G-1 Certificateholder/Class G-1 Trustee/Beneficiary] and MBIA shall agree on such other form as is reasonably necessary to effect such assignment, which assignment shall be without recourse, representation or warranty except as provided above. EX-4.(D)(2) 11 de763576-ex4d2.txt FGI POLICY Exhibit 4(d)(2) MBIA INSURANCE CORPORATION FINANCIAL GUARANTY INSURANCE POLICY April 30, 2002 Policy No. 37923(2) Re: Delta Air Lines Pass Through Trust 2002-1G-2 (the "Class G-2 Trust") $370,286,000 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2 (the "Class G-2 Certificates") Insured Payment of interest at the Stated Interest Rate for the Obligation: Class G-2 Certificates and principal on the Class G-2 Certificates. Beneficiary: State Street Bank and Trust Company of Connecticut, National Association, as subordination agent (together with any successor subordination agent duly appointed and qualified under the Agreement (as defined below) the "Subordination Agent") MBIA INSURANCE CORPORATION ("MBIA"), for consideration received, hereby unconditionally, absolutely and irrevocably and without the assertion of any defenses to payment, including fraud in the inducement or fact or any other circumstances (other than payment in full) that would have the effect of discharging a surety in law or in equity guarantees to the Subordination Agent, subject only to the terms of this Policy (the "Policy"), payment of the Insured Obligation. MBIA agrees to pay to the Subordination Agent, in respect of each Distribution Date, an amount equal to (each a "Deficiency Amount"): (i) with respect to any Regular Distribution Date other than the Final Legal Distribution Date, any shortfall in amounts available to the Subordination Agent, after giving effect to the subordination provisions of the Agreement and the application of any drawing paid under the Class G-2 Liquidity Facility in respect of interest due on the Class G-2 Certificates on such Distribution Date and any withdrawal from the Class G-2 Cash Collateral Account in respect of interest due on the Class G-2 Certificates on such Distribution Date in accordance with the Agreement, for the payment of accrued and unpaid interest on the Class G-2 Certificates, in each case at the Stated Interest Rate for the Class G-2 Certificates on the Pool Balance of the Class G-2 Certificates on such Distribution Date; (ii) with respect to any Special Distribution Date (other than a Special Distribution Date established pursuant to the succeeding clause (iv) below) established by reason of receipt of a Special Payment constituting the proceeds of any Series G-2 Equipment Notes (as to which there has been a default in the payment of principal thereof or that has been accelerated) or the related Indenture Estate or Collateral, as the case may be, any shortfall in the amounts available to the Subordination Agent after giving effect to the subordination provisions of the Agreement and, if such Special Payment is received prior to a Policy Provider Election with respect to such Series G-2 Equipment Note, the application of any drawing paid under the Class G-2 Liquidity Facility in respect of interest due on the Class G-2 Certificates on such Distribution Date and any withdrawal from the Class G-2 Cash Collateral Account in respect of interest due on such Distribution Date in accordance with the Agreement, required to reduce the Pool Balance of the Class G-2 Certificates by an amount equal to the outstanding principal amount of such Series G-2 Equipment Note (determined immediately prior to the receipt of such proceeds and less the amount of any drawings previously paid by MBIA in respect of principal on such Series G-2 Equipment Note) plus accrued and unpaid interest on the amount of such reduction at the Stated Interest Rate for the Class G-2 Certificates from the period from the immediately preceding Regular Distribution Date to such Special Distribution Date; (iii) with respect to the Special Distribution Date established by reason of the failure of the Subordination Agent to have received a Special Payment constituting the proceeds of any Series G-2 Equipment Note or the related Indenture Estate or Collateral, as the case may be, during the eighteen (18) month period beginning on the last date on which full payment was made on such Series G-2 Equipment Note (the date of such payment in full, the "Last Payment Date") as to which there has been a failure to pay principal or that has been accelerated subsequent to the Last Payment Date, the amount equal to the outstanding principal amount of such Series G-2 Equipment Note plus accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-2 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date; provided, however, if MBIA shall have duly given a Policy Provider Election (as defined below) with respect to such Series G-2 Equipment Note at the end of such eighteen (18) month period and at least five (5) days prior to such Special Distribution Date, the Deficiency Amount shall be an amount equal to (A) with respect to such Special Distribution Date the scheduled principal and interest payable but not paid on such Series G-2 Equipment Note (without regard to the acceleration thereof) during such eighteen (18) month period (after giving effect to the application of any drawing paid under the Class G-2 Liquidity Facility and any withdrawal from the Class G-2 Cash Collateral Account attributable to such interest on such Series G-2 Equipment Note) and (B) thereafter, on each Regular Distribution Date following such Special Distribution Date as to which a Policy Provider Election has been given in respect of such Series G-2 Equipment Note, and prior to the establishment of an Election Distribution Date or a Special Distribution Date pursuant to the immediately succeeding clause (iv) with respect to such Series G-2 Equipment Note, an amount equal to the scheduled principal (without regard to the acceleration thereof) and interest payable on such Series G-2 Equipment Note on the related payment date; (iv) following the giving of any Policy Provider Election, with respect to any Business Day elected by MBIA upon twenty (20) days prior notice (which shall be a Special Distribution Date) and upon request by MBIA to the Subordination Agent to make a drawing under this Policy, an amount equal to the then outstanding principal balance of the Series G-2 Equipment Note as to which the Policy Provider Election was given (less any drawings previously paid by MBIA in respect of principal on such Series G-2 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-2 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date; (v) with respect to any Special Distribution Date which is an Election Distribution Date, an amount equal to the then outstanding principal balance of the Series G-2 Equipment Note as to which such Election Distribution Date relates (less any drawing previously paid by MBIA in respect of principal of such Series G-2 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-2 Certificates from the immediately preceding Regular Distribution Date to such Election Distribution Date; and (vi) with respect to the Final Legal Distribution Date, any shortfalls in amounts available to the Subordination Agent after giving effect to the subordination provisions of the Agreement and to the application of any drawing paid under the Class G-2 Liquidity Facility in respect of interest included in the Final Distribution and any withdrawal from the Class G-2 Cash Collateral Account in respect of interest included in the Final Distribution in accordance with the Agreement, for the payment in full of the Final Distribution (calculated as of such date but excluding any accrued and unpaid premium) on the Class G-2 Certificates. For the avoidance of doubt, no Deficiency Amount described in clauses (i)-(vi) above or payment to be made in respect of an Avoided Payment described below shall constitute an accelerated or acceleration payment. If any amount paid or required to be paid in respect of the Insured Obligation is voided (a "Preference Event") under any applicable bankruptcy, insolvency, receivership or similar law in an Insolvency Proceeding, and, as a result of such a Preference Event, the Beneficiary, the Class G-2 Trustee or any Class G-2 Certificateholder is required to return such voided payment, or any portion of such voided payment made or to be made in respect of the Class G-2 Certificates (including any disgorgement from the Class G-2 Certificateholders resulting from any such Insolvency Proceeding, whether such disgorgement is determined on a theory of preferential conveyance or otherwise) (an "Avoided Payment"), MBIA will pay an amount equal to each such Avoided Payment, irrevocably, absolutely and unconditionally and without the assertion of any defenses to payment, including fraud in inducement or fact or any other circumstances that would have the effect of discharging a surety in law or in equity, upon receipt by MBIA from the Beneficiary, the Class G-2 Trustee or such Class G-2 Certificateholder of (x) a certified copy of a final (non-appealable) order of a court exercising jurisdiction in such Insolvency Proceeding to the effect that the Beneficiary, the Class G-2 Trustee or such Class G-2 Certificateholder is required to return any such payment or portion thereof because such payment was voided under applicable law, with respect to which order the appeal period has expired without an appeal having been filed (the "Final Order"), (y) an assignment, in the form of Exhibit D hereto, irrevocably assigning to MBIA all rights and claims of such Beneficiary, the Class G-2 Trustee or such Class G-2 Certificateholder relating to or arising under such Avoided Payment and (z) a Notice of Avoided Payment in the form of Exhibit B hereto appropriately completed and executed by the Beneficiary, the Class G-2 Trustee or such Class G-2 Certificateholder. Such payment shall be disbursed to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order and not to the Beneficiary, the Class G-2 Trustee or such Class G-2 Certificateholder directly unless such Beneficiary, Class G-2 Trustee or Class G-2 Certificateholder has returned such payment to such receiver, conservator, debtor-in-possession or trustee in bankruptcy, in which case such payment shall be disbursed to such Class G-2 Certificateholder, the Class G-2 Trustee or the Beneficiary, as the case may be. Notwithstanding the foregoing, in no event shall MBIA be obligated to make any payment in respect of any Avoided Payment, which payment represents a payment of the principal amount of the Class G-2 Certificates, prior to the time MBIA would have been required to make a payment in respect of such principal pursuant to sub-paragraphs (ii)-(vi) of this Policy; provided, further, that no payment of principal under this Policy on any Distribution Date, other than with respect to an Avoided Payment, shall exceed the Net Principal Policy Amount (as defined below) for such Distribution Date; provided, further, that no payment, other than with respect to an Avoided Payment, of a Deficiency Amount shall be in excess of the then outstanding Pool Balance of the Class G-2 Certificates and accrued and unpaid interest thereon at the Stated Interest Rate on the Class G-2 Certificates. This Policy does not cover (i) any premium, prepayment penalty or other accelerated payment, which at any time may become due on or with respect to any Class G-2 Certificate, (ii) shortfalls, if any, attributable to the liability of the Subordination Agent, the Class G-2 Trust or the Class G-2 Trustee for withholding taxes, if any (including interest and penalties in respect of any such liability) or (iii) any failure of the Subordination Agent or the Class G-2 Trustee to make any payment due to the Class G-2 Certificateholders from funds received. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Intercreditor Agreement (the "Agreement"), dated as of April 30, 2002, among MBIA, as Policy Provider, State Street Bank and Trust Company of Connecticut, National Association, as Trustee of the Trusts, Westdeutsche Landesbank Girozentrale, New York Branch, as Liquidity Provider, and the Subordination Agent, without regard to any amendment or supplement thereto unless such amendment or supplement has been executed, or otherwise approved in writing, by MBIA. "Business Day" shall mean any day other than a Saturday, a Sunday or other day on which insurance companies in New York, New York or commercial banking institutions in the cities in which the corporate trust office of the Subordination Agent, the Fiscal Agent (as defined herein) or the office of MBIA specified in this Policy are located are authorized or obligated by law or executive order to close. "Class G-2 Certificateholder" shall mean any person who is the registered owner or beneficial owner of any of the Class G-2 Certificates and who, on the applicable Distribution Date, is entitled under the terms of the Class G-2 Certificates to payment thereunder. "Election Distribution Date" shall mean any Special Distribution Date established by the Subordination Agent upon 20 days' notice to the Class G-2 Trustee and the Policy Provider by reason of the occurrence and continuation of a Policy Provider Default occurring after a Policy Provider Election. "Final Legal Distribution Date" shall mean January 2, 2014. "Indenture Estate" shall have the meaning given such term in the Indenture for any Leased Aircraft. "Insolvency Proceeding" means the commencement, after the date hereof, of any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of assets and liabilities or similar proceedings by or against Delta Air Lines, Inc., any Liquidity Provider or any Owner Trustee and the commencement, after the date hereof, of any proceedings by Delta Air Lines, Inc., any Liquidity Provider, or any Owner Trustee for the winding up or liquidation of its affairs or the consent, after the date hereof, to the appointment of a trustee, conservator, receiver, or liquidator in any bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of assets and liabilities or similar proceedings of or relating to Delta Air Lines, Inc., any Liquidity Provider, or any Owner Trustee. "Insurance Agreement" shall mean the Insurance and Indemnity Agreement (as may be amended, modified or supplemented from time to time), dated as of April 30, 2002, by and among MBIA, Delta Air Lines, Inc., the Class G-2 Trustee, the Class G-2 Trustee and the Subordination Agent. "Insured Amounts" shall mean, with respect to any Distribution Date, the Deficiency Amount for such Distribution Date. "Net Principal Policy Amount" shall mean the Pool Balance of the Class G-2 Certificates as of the Closing Date minus all amounts previously drawn on this Policy with respect to principal. "Nonpayment" shall mean, with respect to any Distribution Date, a Deficiency Amount owing to the Subordination Agent for distribution to the Class G-2 Certificateholders in respect of such Distribution Date. "Notice of Avoided Payment" shall mean the notice, substantially in the form of Exhibit B hereto, delivered pursuant to this Policy and sent to the contact person at the address and/or fax number set forth in this Policy, and specifying the Avoidance Payment which shall be due and owing on the applicable Distribution Date. "Notice of Nonpayment" shall mean the notice, substantially in the form of Exhibit A hereto, delivered pursuant to this Policy and sent to the contact person at the address and/or fax numbers set forth in this Policy specifying the Insured Amount which shall be due and owing to the Class G-2 Trustee for distribution to the Class G-2 Certificateholders on the applicable Distribution Date. "Policy Provider Election" shall mean a notice given by MBIA when no Policy Provider Default shall have occurred and be continuing, stating that MBIA elects to make payments of Deficiency Amounts as defined under the proviso to clause (iii) of the definition of Deficiency Amount in respect of any Series G-2 Equipment Note in lieu of applying clause (iii) (without the proviso) of the definition of Deficiency Amount, which notice shall be given to the Subordination Agent not less than five (5) days prior to the Special Distribution Date established for payment of a Deficiency Amount under clause (iii) of the definition thereof. "Trust Agreement" shall mean the Pass Through Trust Agreement, dated as of November 16, 2000, between Delta Air Lines, Inc. and State Street Bank and Trust Company of Connecticut, National Association, as Trustee, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, between the same parties, pursuant to which the Class G-2 Certificates have been issued. Payment of amounts hereunder shall be made in immediately available funds (x) with respect to Deficiency Amounts no later than 3:00 p.m., New York City time, on the later of (a) the relevant Distribution Date and (b) the Business Day of presentation to State Street Bank and Trust Company, N.A., as fiscal agent for MBIA or any successor fiscal agent appointed by MBIA (the "Fiscal Agent"), of a Notice of Nonpayment, appropriately completed and executed by the Beneficiary (if such Notice of Nonpayment is received by 1:00 p.m. on such day), and (y) with respect to Avoided Payments, prior to 3:00 p.m. New York City time, on the third Business Day following MBIA's receipt of the documents required under clauses (x) through (z) of the third paragraph of this Policy. Any such documents received by MBIA after 1:00 p.m. New York City time on any Business Day or on any day that is not a Business Day shall be deemed to have been received by MBIA prior to 1:00 p.m. on the next succeeding Business Day. All payments made by MBIA hereunder in respect of Avoided Payments will be made with MBIA's own funds. A Notice of Nonpayment or Notice of Avoided Payment under this Policy may be presented to the Fiscal Agent on any Business Day by (a) delivery of the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its address set forth below, or (b) facsimile transmission of the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its facsimile number set forth below. If presentation is made by facsimile transmission, the Beneficiary shall (i) simultaneously confirm transmission by telephone to the Fiscal Agent at its telephone number set forth below, and (ii) as soon as reasonably practicable, deliver the original Notice of Nonpayment or Notice of Avoided Payment to the Fiscal Agent at its address set forth below. Each Notice of Nonpayment or Notice of Avoided Payment shall be delivered by facsimile and mail to MBIA simultaneously with its delivery to the Fiscal Agent. If any Notice of Nonpayment or Notice of Avoided Payment received by the Fiscal Agent is not in proper form or is otherwise insufficient for the purpose of making a claim hereunder, it shall be deemed not to have been received by the Fiscal Agent, and MBIA or the Fiscal Agent, as the case may be, shall promptly so advise the Beneficiary, and the Beneficiary may submit an amended Notice of Nonpayment or Notice of Avoided Payment, as the case may be. Payments due hereunder unless otherwise stated herein will be disbursed by the Fiscal Agent to the Subordination Agent for the benefit of the Class G-2 Certificateholders by wire transfer of immediately available funds in the amount of such payment. Other than amounts payable in respect of Avoided Payments, MBIA's obligations under this Policy shall be discharged to the extent funds to be applied to pay the Insured Obligations under and in accordance with the Intercreditor Agreement are received by the Subordination Agent (including funds disbursed by MBIA as provided in this Policy and received by the Subordination Agent) for the Class G-2 Trust whether or not such funds are properly applied by the Subordination Agent, the Paying Agent or the Class G-2 Trustee. MBIA's obligations to make payments in respect of any Avoided Payments shall be discharged to the extent such payments are made by MBIA hereunder and are received by the Subordination Agent, the Class G-2 Trustee, the applicable Class G-2 Certificateholder or the receiver, conservator, debtor-in-possession or trustee in bankruptcy as applicable, whether or not such payments are properly applied by the Subordination Agent or the Class G-2 Trustee. The Fiscal Agent is the agent of MBIA only, and the Fiscal Agent shall in no event be liable to Class G-2 Certificateholders for any acts of the Fiscal Agent or any failure of MBIA to deposit or cause to be deposited sufficient funds to make payments due under this Policy. Any notice hereunder delivered to the Fiscal Agent of MBIA may be made at the address listed below for the Fiscal Agent of MBIA or such other address as MBIA shall specify in writing to the Subordination Agent. The notice address of the Fiscal Agent is 61 Broadway, 15th Floor, New York, New York 10006, Attention: Municipal Registrar and Paying Agency, Facsimile: (212) 612-3201, Telephone: (212) 612-3458. All notices, presentations, transmissions, deliveries and communications made by the Beneficiary to MBIA with respect to this Policy shall specifically refer to the number of this Policy and shall be made to MBIA at: MBIA Insurance Corporation 113 King Street Armonk, NY 10504 Attention: Insured Portfolio Management, Structured Finance Telephone: (914) 273-4949 Facsimile: (914) 765-3163 or such other address, telephone number or facsimile number as MBIA may designate to the Beneficiary in writing from time to time. Each such notice, presentation, transmission, delivery and communication shall be effective only upon actual receipt by MBIA. To the extent and in the manner specified in the Intercreditor Agreement for the Class G-2 Trust, MBIA shall be subrogated to the rights of each Class G-2 Certificateholder to receive payments under the Class G-2 Certificates to the extent of any payment made by it hereunder. This Policy is neither transferable nor assignable, in whole or in part, except to a successor Subordination Agent duly appointed and qualified under the Agreement. Such transfer and assignment shall be effective upon receipt by MBIA of a copy of the instrument effecting such transfer and assignment signed by the transferor and by the transferee, and a certificate, properly completed and signed by the transferor and the transferee, in the form of Exhibit C hereto (which shall be conclusive evidence of such transfer and assignment), and, in such case, the transferee instead of the transferor shall, without the necessity of further action, be entitled to all the benefits of and rights under this Policy in the transferor's place, provided that, in such case, the Notice of Nonpayment presented hereunder shall be a certificate of the transferee and shall be signed by one who states therein that he is a duly authorized officer of the transferee. There shall be no acceleration payment due under this Policy unless such acceleration is at the sole option of MBIA. This Policy shall terminate and the obligations of MBIA hereunder shall be discharged on the day (the "Termination Date") which is one year and one day following the Distribution Date upon which the Final Distribution on the Class G-2 Certificates is made. The foregoing notwithstanding, if an Insolvency Proceeding is existing during the one year and one day period set forth above, then this Policy and MBIA's obligations hereunder shall terminate on the later of (i) the date of the conclusion or dismissal of such Insolvency Proceeding without continuing jurisdiction by the court in such Insolvency Proceeding, and (ii) the date on which MBIA has made all payments required to be made under the terms of this Policy in respect of Avoided Payments. This Policy is not covered by the property/casualty insurance fund specified in Article Seventy-Six of the New York State insurance law. This Policy sets forth in full the undertaking of MBIA, and, except as expressly provided in the Insurance Agreement and the Agreement, shall not be modified, altered or affected by any other agreement or instrument, including any modification or amendment to any other agreement or instrument, or by the merger, consolidation or dissolution of Delta Air Lines, Inc. or any other Person and may not be canceled or revoked by MBIA prior to the time it is terminated in accordance with the express terms hereof. The Premium on this Policy is not refundable for any reason. This Policy shall be returned to MBIA upon termination. THIS POLICY SHALL BE CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. IN WITNESS WHEREOF, MBIA has caused this Policy to be duly executed on the date first written above. MBIA INSURANCE CORPORATION By: ___________________________________ Name: Title: By: ___________________________________ Name: Title: Exhibit A to Policy Number 37923(2) NOTICE OF NONPAYMENT AND DEMAND FOR PAYMENT OF INSURED AMOUNTS Date: [____________] MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance State Street Bank and Trust Company, N.A. 61 Broadway, 15th Floor New York, New York 10006 Attention: Municipal Registrar and Paying Agency Reference is made to Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2. Terms capitalized herein and not otherwise defined shall have the meanings ascribed to such terms in or pursuant to the Policy unless the context otherwise requires. The Subordination Agent hereby certifies as follows: 1. The Subordination Agent is the trustee for the Class G-2 Trust under the Class G-2 Trust Agreement. 2. The relevant Distribution Date is __________. Such Distribution Date is a [Regular Distribution Date, a Special Distribution Date, an Election Distribution Date or the Final Legal Distribution Date]. [3. Payment of accrued and unpaid interest on the Class G-2 Certificates at the Stated Interest Rate on the outstanding Pool Balance of the Class G-2 Certificates accrued to the Distribution Date which is a Regular Distribution Date as determined pursuant to paragraph (i) of the definition of "Deficiency Amount" in the Policy is an amount equal to $____________.] [3. The amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (ii) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of a reduction in the outstanding Pool Balance of such Class G-2 Certificates and accrued and unpaid interest on the amount of such reduction at the Stated Interest Rate for the Class G-2 Certificates is $____________.] [3. The Subordination Agent has not received a timely Policy Provider Election pursuant to the Policy and the amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (iii) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of the outstanding principal amount of the relevant Series G-2 Equipment Note(s) and accrued and unpaid interest accrued thereon at the Stated Interest Rate for the Class G-2 Certificates is $________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy and the amount determined for payment to the Class G-2 Certificateholders pursuant to the provision in paragraph (iii)(A) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Special Distribution Date in respect of scheduled principal (without regard to acceleration thereof) and interest at the Stated Interest Rate for the Class G-2 Certificates payable but not paid on the relevant Series G-2 Equipment Note during the eighteen (18) month period referred to in such paragraph (iii) is $_________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy, no Election Distribution Date has been established pursuant to the Policy or Special Distribution Date established pursuant to clause (iv) of the definition of "Deficiency Amount" and the amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (iii)(B) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is a Regular Distribution Date in respect of scheduled principal (without regard to acceleration thereof) and interest payable at the Stated Interest Rate for the Class G-2 Certificates due on the Regular Distribution Date on the relevant Series G-2 Equipment Note is $____________.] [3. The Subordination Agent has received a timely Policy Provider Election pursuant to the Policy, the Special Distribution Date related hereto is a Business Day elected by MBIA upon 20 days prior notice and the amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (iv) of the definition of "Deficiency Amount" in the Policy in respect of outstanding principal on such Series G-2 Equipment Note (less any drawings previously paid by MBIA in respect of principal on such Series G-2 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-2 Certificates from the immediately preceding Regular Distribution Date to such Special Distribution Date is $__________.] [3. The amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (v) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is an Election Distribution Date in respect of the outstanding principal balance of the relevant Series G-2 Equipment Note (less any drawings previously paid by MBIA in respect of principal on such Series G-2 Equipment Note) and accrued and unpaid interest thereon at the Stated Interest Rate for the Class G-2 Certificates from the immediately preceding Regular Distribution Date to such Election Distribution Date is $___________.] [3. The amount determined for payment to the Class G-2 Certificateholders pursuant to paragraph (vi) of the definition of "Deficiency Amount" in the Policy on the Distribution Date which is the Final Legal Distribution Date in respect of payment in full of the Final Distribution (other than premium) on the Class G-2 Certificates is $__________.] 4. The sum of $_________________ is the Insured Amount that is due. 5. The Subordination Agent has not heretofore made a demand for the Insured Amount in respect of such Distribution Date. 6. The Subordination Agent hereby requests payment of such Insured Amount that is due for payment be made by MBIA under the Policy and directs that payment under the Policy be made to the following account by bank wire transfer of federal or other immediately available funds in accordance with the terms of the Policy to: [____] ABA #: [_____] Acct #: [_____] FBO: [_____] [Class G-2 Policy Account number] 7. The Subordination Agent hereby agrees that, following receipt of the Insured Amount from MBIA, it shall (a) cause such funds to be deposited in the Class G-2 Policy Account and not permit such funds to be held in any other account, (b) cause such funds to be paid to the Class G-2 Trustee for distribution to the Class G-2 Certificateholders in reduction of the Pool Balance of, or interest on, the Class G-2 Certificates (as applicable) and not apply such funds for any other purpose and (c) maintain an accurate record of such payments with respect to the Class G-2 Certificates and the corresponding claim on the Policy and proceeds thereof. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By:______________________________________ Name: Title: Exhibit B to Policy Number 37923(2) NOTICE OF AVOIDED PAYMENT AND DEMAND FOR PAYMENT OF AVOIDED PAYMENTS Date: [____________] MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance State Street Bank and Trust Company, N.A. 61 Broadway, l5th Floor New York, New York 10006 Attention: Municipal Registrar and Paying Agency Reference is made to Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2. Terms capitalized herein and not otherwise defined shall have the meanings ascribed to such terms in or pursuant to the Policy unless the context otherwise requires. The Subordination Agent hereby certifies as follows: 1. The Subordination Agent is the trustee for the Class G-2 Trustee under the Trust Agreement. 2. The Subordination Agent has established ______________ as a Special Distribution Date pursuant to the Agreement for amounts claimed hereunder. 3. A Final Order providing for the recovery of an Avoided Payment of $________________ has been issued. 4. $_________________ of the amount set forth in item No. 3 above has been paid by the [Class G-2 Certificateholder/Class G-2 Trustee/Subordination Agent] and $_________________ is required to be paid to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order. 5. The [Class G-2 Certificateholder/Class G-2 Trustee/Subordination Agent] has not heretofore made a demand for such Avoided Payment. 6. The [Class G-2 Certificateholder/Class G-2 Trustee/Subordination Agent] has delivered to MBIA or has attached hereto all documents required by the Policy to be delivered in connection with such Avoided Payment. 7. The [Class G-2 Certificateholder/Class G-2 Trustee/Subordination Agent] hereby requests that payment of $______________ of such Avoided Payment be made to the receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Final Order and $________________ of such Avoided Payment be paid to the [Class G-2 Certificateholder] [Class G-2 Trustee] [Subordination Agent [for payment over to the Class G-2 Trustee] for distribution to the Class G-2 Certificateholder], in each case, by MBIA under the Policy and directs that payment under the Policy be made to the following account by bank wire transfer of federal or other immediately available funds in accordance with the terms of the Policy to: For the portion to be paid to the receiver, conservator, debtor-in-possession or trustee, to _________________________: ABA #: [_____] Acct #: [_____] FBO: [_____] [relevant account number] For the portion to be paid to the Subordination Agent: ABA #: [_____] Acct #: [_____] FBO: [_____] [Class G-2 Policy Account Number] [Name of Subordination Agent] By:______________________________________ Name: Title: (Officer) Exhibit C to Policy Number 37923(2) MBIA Insurance Corporation 113 King Street Armonk, New York 10504 Attention: Insured Portfolio Management, Structured Finance Dear Sirs: Reference is made to that certain Policy, Number 37923(2), dated April 30, 2002 (the "Policy"), which has been issued by MBIA Insurance Corporation in favor of the Subordination Agent with respect to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2. The undersigned [Name of Transferor] has transferred and assigned (and hereby confirms to you said transfer and assignment) all of its rights in and under said Policy to [Name of Transferee] and confirms that [Name of Transferor] no longer has any rights under or interest in said Policy. Transferor and Transferee have indicated on the face of said Policy that it has been transferred and assigned to Transferee. Transferee hereby certifies that it is a duly authorized transferee under the terms of said Policy and is accordingly entitled, upon presentation of the document(s) called for therein, to receive payment thereunder. _________________________________________ [Name of Transferor] By:____________________________________ [Name and Title of Authorized Officer of Transferor] Exhibit D to Policy Number 37923(2) Form of Assignment Reference is made to that certain Policy No. 37923(2), dated April 30, 2002 (the "Policy"), issued by MBIA Insurance Corporation ("MBIA") relating to the 6.417% Delta Air Lines Pass Through Certificates, Series 2002-1G-2. Unless otherwise defined herein, capitalized terms used in this Assignment shall have the meanings assigned thereto in the Policy as incorporated by reference therein. In connection with the Avoided Payment of [$_________] paid by the undersigned (the "[Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary]") on [______] and the payment by MBIA in respect of such Avoided Payment pursuant to the Policy, the [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary] hereby irrevocably and unconditionally, without recourse, representation or warranty (except as provided below), sells, assigns, transfers, conveys and delivers to MBIA all of such [Class G-2 Certificateholder's/Class G-2 Trustee's/Beneficiary's] rights, title and interest in and to any rights or claims, whether accrued, contingent or otherwise, which the [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary] now has or may hereafter acquire, against any person relating to, arising out of or in connection with such Avoided Payment. The [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary] represents and warrants that such claims and rights are free and clear of any lien or encumbrance created or incurred by such [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary].(1) [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary] By:____________________________________ Name: Title: - ------------------ (1) In the event that the terms of this form of assignment are reasonably determined to be insufficient solely as a result of a change of law or applicable rules after the date of the Policy to fully vest all of the [Class G-2 Certificateholder's/Class G-2 Trustee's/Beneficiary's] right, title and interest in such rights and claims, the [Class G-2 Certificateholder/Class G-2 Trustee/Beneficiary] and MBIA shall agree on such other form as is reasonably necessary to effect such assignment, which assignment shall be without recourse, representation or warranty except as provided above. EX-4.(E)(1) 12 de763576-ex4e1.txt PARTICIPATION AGMT Exhibit 4(e)(1) ================================================================================ PARTICIPATION AGREEMENT (N372DA) Dated as of April 30, 2002 among DELTA AIR LINES, INC., STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein --------------- One Boeing 737-832 Aircraft U.S. Registration No. N372DA ================================================================================ TABLE OF CONTENTS ARTICLE 1 DEFINITIONS Section 1.01 Definitions................................................... Section 1.02 Other Definitional Provisions................................. ARTICLE 2 THE LOANS Section 2.01 The Loans..................................................... Section 2.02 Issuance of Equipment Notes................................... Section 2.03 The Closing................................................... ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to Obligations of Pass Through Trustees.................................................... Section 3.02 Conditions Precedent to Obligations of Company................ ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY Section 4.01 Representations and Warranties of Company..................... Section 4.02 General Indemnity............................................. ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF STATE STREET Section 5.01 Representations, Warranties and Covenants of State Street..... ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements.............................................. Section 6.02 Certain Covenants of Company.................................. ARTICLE 7 MISCELLANEOUS Section 7.01 Notices....................................................... Section 7.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements.................................... Section 7.03 Governing Law................................................. Section 7.04 Severability.................................................. Section 7.05 No Oral Modifications or Continuing Waivers; Consents......... Section 7.06 Effect of Headings and Table of Contents...................... Section 7.07 Successors and Assigns........................................ Section 7.08 Benefits of Agreement......................................... Section 7.09 Counterparts.................................................. Section 7.10 Submission to Jurisdiction.................................... Section 7.11 Sale/Leaseback Transaction.................................... Schedule I - Equipment Notes, Purchasers and Original Principal Amounts Schedule II - Trust Supplements Exhibit A-1 - Form of Opinion of Counsel for Company Exhibit A-2 - Form of Opinion of Cadwalader, Wickersham & Taft, special counsel for Company Exhibit A-3 - Form ofss. 1110 Opinion of Cadwalader, Wickersham & Taft, special counsel for Company Exhibit B - Form of Opinion of Special Counsel for Loan Trustee, Subordination Agent and State Street Exhibit C - Form of Opinion of Special FAA Counsel Exhibit D-1 - Form of Opinion of Special Counsel for Liquidity Provider Exhibit D-2 - Form of Opinion of German In-House Counsel for Liquidity Provider Exhibit E - Form of Manufacturer's Consent Exhibit F - Form of Opinion of Special Counsel for Pass Through Trustees Exhibit G - Form of Amended and Restated Participation Agreement Exhibit H - Form of Lease Exhibit I - Form of Amended and Restated Indenture Exhibit J - Form of Purchase Agreement Assignment Exhibit K - Form of Trust Agreement Exhibit L - Mandatory Document Terms Exhibit M - Mandatory Economic Terms Exhibit N - Form of Opinion of Special Counsel for Policy Provider Annex A - Definitions PARTICIPATION AGREEMENT (N372DA) This PARTICIPATION AGREEMENT (N372DA), dated as of April 30, 2002, is made by and among DELTA AIR LINES, INC., a Delaware corporation (together with its successors and permitted assigns, "Company"), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association (in its individual capacity, together with its successors and permitted assigns, "State Street"), not in its individual capacity except as otherwise expressly provided in any of the Operative Documents or the Pass Through Documents, but solely as trustee (in such capacity together with any successor or other trustee in such capacity, "Pass Through Trustee") under each of the Pass Through Trust Agreements (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as subordination agent and trustee (in such capacity, together with any successor trustee in such capacity, "Subordination Agent") under the Intercreditor Agreement, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as loan trustee (in such capacity, together with any successor trustee in such capacity, "Loan Trustee") under the Indenture. W I T N E S S E T H: WHEREAS, Company is the owner of that certain Boeing Model 737-832 aircraft more particularly described in the Indenture Supplement originally executed and delivered under the Indenture; WHEREAS, concurrently with the execution and delivery of this Agreement, Company and Loan Trustee are entering into the Indenture, pursuant to which, among other things, Company will issue three series of Equipment Notes, which Equipment Notes are to be secured by a security interest in all right, title and interest of Company in and to the Aircraft and certain other property described in the Indenture; WHEREAS, pursuant to the Basic Pass Through Trust Agreement and each of the Trust Supplements set forth in Schedule II, concurrently with the execution and delivery of this Agreement, separate Pass Through Trusts are being created to facilitate certain of the transactions contemplated hereby, including, without limitation, the issuance and sale of Pass Through Certificates; WHEREAS, pursuant to the Intercreditor Agreement, Subordination Agent will hold the Equipment Notes on behalf of the Pass Through Trusts; NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS Section 1.01 Definitions. For the purposes of this Agreement, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) All references in this Agreement to a "government" are to such government and any instrumentality or agency thereof. (e) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". ARTICLE 2 THE LOANS Section 2.01 The Loans. Subject to the terms and conditions of this Agreement and the Indenture, on the Closing Date Pass Through Trustee for each Pass Through Trust shall make a loan to Company by paying to Company the aggregate original principal amounts of the Equipment Notes being issued to such Pass Through Trust as set forth on Schedule I opposite the name of such Pass Through Trust. Pass Through Trustees, on behalf of the Pass Through Trusts, shall make such loans to Company no later than 11:00 a.m. (New York City time) on the Closing Date by transferring such amount in immediately available funds to Company at its account at Citibank, N.A., 111 Wall Street, New York, New York, Account No. 40002617, ABA Number 021000089, with the request that the bank advise Company by telephone at (404) 715-2046 upon transfer of the funds. Section 2.02 Issuance of Equipment Notes. Upon the occurrence of the above payments by Pass Through Trustee for each Pass Through Trust to Company, Company shall issue, pursuant to and in accordance with Article II of the Indenture, to Subordination Agent as agent and trustee for Pass Through Trustee for each Pass Through Trust, one or more Equipment Notes of the maturity and aggregate principal amount and bearing the interest rate set forth in Schedule I opposite the name of such Pass Through Trust. Each such Equipment Note shall be duly authenticated by Loan Trustee pursuant to the Indenture, registered in the name of Subordination Agent and dated the Closing Date and shall be delivered by Loan Trustee to Subordination Agent. Section 2.03 The Closing. The closing (the "Closing") of the transactions contemplated hereby shall take place at the offices of Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York at 9:30 a.m. (New York City time) on April 30, 2002, or at such other time or place as the parties shall agree. ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to Obligations of Pass Through Trustees. The obligation of each Pass Through Trustee to make the loan contemplated by Article II is subject to the fulfillment (or the waiver by such Pass Through Trustee) prior to or on the Closing Date of the following conditions precedent: (a) Company shall have tendered the Equipment Notes to Loan Trustee for authentication, and Loan Trustee shall have authenticated such Equipment Notes and shall have tendered the Equipment Notes to Subordination Agent on behalf of the applicable Pass Through Trustee in accordance with Section 2.02. (b) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Pass Through Trustees to make the loans contemplated by Section 2.01 or to acquire the Equipment Notes. (c) This Agreement and the following documents shall have been duly authorized, executed and delivered by the respective party or parties thereto (other than Pass Through Trustees or Loan Trustee), shall be in full force and effect and executed counterparts (or copies thereof where indicated) thereof shall have been delivered to each Pass Through Trustee: (i) the Intercreditor Agreement; (ii) the Liquidity Facilities; (iii) the Pass Through Trust Agreements; (iv) the Indenture and the Indenture Supplement covering the Aircraft and dated the Closing Date; (v) the Manufacturer's Consent; (vi) a copy of the FAA Bill of Sale; and (vii) a copy of the Warranty Bill of Sale. (d) A Uniform Commercial Code financing statement or statements covering the security interest created by the Indenture shall have been executed and delivered by Company, as debtor, and by Loan Trustee, as secured party, and such financing statement or statements shall have been duly filed in all places necessary or desirable within the State of Delaware. (e) Each Pass Through Trustee shall have received the following: (i) a certificate dated the Closing Date of the Secretary or an Assistant Secretary of Company, certifying as to (A) a copy of the resolutions of the Board of Directors of Company or the executive committee thereof duly authorizing the transactions contemplated hereby and the execution, delivery and performance by Company of this Agreement and the Indenture and each other document required to be executed and delivered by Company in accordance with the provisions hereof or thereof and (B) a copy of the certificate of incorporation and by-laws of Company, as in effect on the Closing Date; (ii) a certificate or other evidence from the Secretary of State of the State of Delaware, dated as of a date reasonably near the Closing Date, as to the due incorporation and good standing of Company in such state; (iii) an incumbency certificate of Company as to the person or persons authorized to execute and deliver this Agreement, the Indenture and each other document to be executed by Company in connection with the transactions contemplated hereby and thereby, and the specimen signatures of such person or persons; and (iv) one or more certificates of Loan Trustee and Subordination Agent certifying to the reasonable satisfaction of Pass Through Trustees as to the due authorization, execution, delivery and performance by Loan Trustee and Subordination Agent of each of the Operative Documents to which Loan Trustee or Subordination Agent is or will be a party and any other documents to be executed by or on behalf of Loan Trustee or Subordination Agent in connection with the transactions contemplated hereby or thereby. (f) On the Closing Date, the following statements shall be correct: (i) the representations and warranties of Company herein are correct in all material respects as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties are correct on and as of such earlier date) and (ii) no event has occurred and is continuing that constitutes an Event of Default or an Event of Loss or would constitute an Event of Default or Event of Loss but for the requirement that notice be given or time elapse or both. (g) Each Pass Through Trustee and Loan Trustee shall have received (i) an opinion addressed to it from the General Counsel or an Associate General Counsel of Company (or such other internal counsel to Company as shall be reasonably satisfactory to Pass Through Trustees) substantially in the form set forth in Exhibit A-1 and (ii) opinions addressed to it from Cadwalader, Wickersham & Taft substantially in the forms set forth in Exhibits A-2 and A-3. (h) Each Pass Through Trustee and Loan Trustee shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for State Street, Loan Trustee and Subordination Agent, substantially in the form set forth in Exhibit B. (i) Each Pass Through Trustee and Loan Trustee shall have received an opinion addressed to it from Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma, substantially in the form set forth in Exhibit C. (j) Each Pass Through Trustee and Loan Trustee shall have received a certificate or certificates signed by the chief financial or accounting officer, any Senior Vice President, the Treasurer, any Vice President or any Assistant Treasurer (or any other Responsible Officer) of Company, dated the Closing Date, certifying as to the correctness of each of the matters stated in Section 3.01(f). (k) Each Pass Through Trustee shall have received a certificate from State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, dated the Closing Date, signed by an authorized officer of State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, certifying for each such entity that no Loan Trustee Liens or Other Party Liens attributable to it, as applicable, exist, and further certifying as to the correctness of each of the matters stated in Section 5.01. (l) Each Pass Through Trustee shall have received opinions addressed to it from Milbank, Tweed, Hadley & McCloy LLP, special counsel for Liquidity Provider, substantially in the form set forth in Exhibit D-1, and from German in-house counsel for Liquidity Provider, substantially in the form set forth in Exhibit D-2. (m) Loan Trustee shall have received an insurance report of an independent insurance broker and the related certificates of insurance, each in form and substance reasonably satisfactory to Loan Trustee, as to the compliance with the terms of Section 7.06 of the Indenture relating to insurance with respect to the Aircraft. (n) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (o) Company shall have entered into the Underwriting Agreement, the Pass Through Certificates shall have been issued and sold pursuant to the Underwriting Agreement and the Underwriters shall have transferred to Pass Through Trustees in immediately available funds an amount at least equal to the aggregate purchase price of the Equipment Notes to be purchased from Company. (p) Loan Trustee shall have received an executed copy of the Manufacturer's Consent substantially in the form set forth in Exhibit E. (q) Each Pass Through Trustee shall have received an opinion from Latham & Watkins, special counsel to the Policy Provider, substantially in the form set forth in Exhibit N. Promptly upon the recording of the Indenture (with the Indenture Supplement attached) pursuant to the Transportation Code, Company will cause Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma to deliver to Subordination Agent on behalf of Pass Through Trustees, to Loan Trustee and to Company an opinion as to the due recording of such instrument and the lack of filing of any intervening documents with respect to the Aircraft. Section 3.02 Conditions Precedent to Obligations of Company. The obligation of Company to issue and sell the Equipment Notes is subject to the fulfillment (or waiver by Company) prior to or on the Closing Date of the following conditions precedent: (a) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Company to enter into any transaction contemplated by the Operative Documents or the Pass Through Trust Agreements. (b) The documents referred to in Section 3.01(c) shall have been duly authorized, executed and delivered by the respective party or parties thereto (other than Company), shall be in full force and effect and executed counterparts (or copies thereof where indicated) thereof shall have been delivered to Company, and Company shall have received such documents and evidence with respect to State Street, Liquidity Provider, Policy Provider, Loan Trustee, Subordination Agent and each Pass Through Trustee as Company reasonably requests in order to establish the consummation of the transactions contemplated by this Agreement, the taking of all corporate and other proceedings in connection therewith and compliance with the conditions herein set forth. (c) The Indenture (with the Indenture Supplement covering the Aircraft attached) shall have been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code. (d) On the Closing Date, the representations and warranties herein of State Street, Loan Trustee, Subordination Agent and Pass Through Trustees shall be correct as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties shall have been correct on and as of such earlier date), and, insofar as such representations and warranties concern State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee, such party shall have so certified to Company. (e) Company shall have received each opinion referred to in Subsections 3.01(h), 3.01(i), 3.01(l) and 3.01(q), each such opinion (other than 3.01(l)) addressed to Company or accompanied by a letter from the counsel rendering such opinion authorizing Company to rely on such opinion as if it were addressed to Company, and the certificates referred to in Subsections 3.01(e)(iv) and 3.01(k). (f) Company shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for Pass Through Trustees, substantially in the form set forth in Exhibit F. (g) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (h) Company shall have received a certificate from State Street dated the Closing Date, signed by an authorized officer of State Street, certifying for each Pass Through Trustee that no Other Party Liens attributable to it exist and further certifying as to the correctness of each of the matters stated in Section 5.01. (i) Company shall have been paid by Pass Through Trustee for each Pass Through Trust the aggregate original principal amount of the Equipment Notes being issued to such Pass Through Trust as set forth on Schedule I opposite the name of such Pass Through Trust. ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY Section 4.01 Representations and Warranties of Company. Company represents and warrants that: (a) Company is a corporation duly incorporated and validly existing in good standing under the laws of the State of Delaware, is a Certificated Air Carrier, is a Citizen of the United States, has the corporate power and authority to own its properties or hold them under lease and to enter into and perform its obligations under the Operative Documents to which it is a party and is duly qualified to do business as a foreign corporation in good standing in each other jurisdiction in which the failure to so qualify would have a material adverse effect on the consolidated financial condition of Company and its subsidiaries, considered as a whole, and its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Georgia) is Delaware. (b) The execution, delivery and performance by Company of this Agreement and the other Operative Documents to which Company is a party have been duly authorized by all necessary corporate action on the part of Company, do not require any stockholder approval or approval or consent of any trustee or holder of any indebtedness or obligations of Company, except such as have been duly obtained and are in full force and effect, and do not contravene any law, governmental rule, regulation, judgment or order binding on Company or the certificate of incorporation or by-laws of Company or contravene or result in a breach of, or constitute a default under, or result in the creation of any Lien (other than as permitted under the Indenture) upon the property of Company under, any material indenture, mortgage, contract or other agreement to which Company is a party or by which it or any of its properties may be bound or affected. (c) Neither the execution and delivery by Company of this Agreement and the other Operative Documents to which it is a party, nor the consummation by Company of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with or the taking of any other action in respect of, the Department of Transportation, the FAA or any other federal or state governmental authority or agency, except for (i) the registration of the Pass Through Certificates (other than the Class D Pass Through Certificates) under the Securities Act of 1933, as amended, and under the securities laws of any state in which the Pass Through Certificates may be offered for sale if the laws of such state require such action, (ii) the qualification of the Pass Through Trust Agreements under the Trust Indenture Act of 1939, as amended, (iii) the orders, permits, waivers, exemptions, authorizations and approvals of the regulatory authorities having jurisdiction over Company's operation of the Aircraft required to be obtained on or prior to the Closing Date, which orders, permits, waivers, exemptions, authorizations and approvals have been duly obtained and are, or on the Closing Date will be, in full force and effect, (iv) the filings referred to in Section 4.01(e) and (v) consents, approvals, notices, registrations and other actions required to be obtained, given, made or taken only after the date hereof. (d) This Agreement and each other Operative Document to which Company is a party have been duly executed and delivered by Company and constitute the legal, valid and binding obligations of Company enforceable against Company in accordance with their terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity and except, in the case of the Indenture, as limited by applicable laws that may affect the remedies provided in the Indenture. (e) Except for (i) the filing for recordation pursuant to the Transportation Code of the Indenture (with the Indenture Supplement covering the Aircraft attached) and (ii) with respect to the security interests created by such documents, the filing of financing statements (and continuation statements at periodic intervals) under the Uniform Commercial Code of Georgia, no further filing or recording of any document is necessary under the laws of the United States or any state thereof as of the Closing Date in order to establish and perfect the security interest in the Aircraft created under the Indenture in favor of Loan Trustee as against Company and any third parties in any applicable jurisdiction in the United States. (f) Company is not an investment company or a company controlled by an investment company within the meaning of the Investment Company Act of 1940, as amended. (g) As of the Closing Date, (i) Company has good title to the Aircraft, free and clear of Liens other than Permitted Liens, (ii) the Aircraft has been duly certificated by the FAA as to type and airworthiness in accordance with the terms of the Indenture, (iii) the Indenture (with the Indenture Supplement covering the Aircraft attached) has been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code and (iv) the Aircraft is duly registered with the FAA in the name of Company. Section 4.02 General Indemnity. (a) Claims Defined. For the purposes of this Section 4.02, "Claims" means any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs or expenses of whatsoever kind and nature (whether or not on the basis of negligence, strict or absolute liability or liability in tort) that may be imposed on, incurred by, suffered by or asserted against an Indemnitee, as defined below, and, except as otherwise expressly provided in this Section 4.02, includes all reasonable out-of-pocket costs, disbursements and expenses (including reasonable out-of-pocket legal fees and expenses) actually incurred by an Indemnitee in connection therewith or related thereto. (b) Indemnitee Defined. For the purposes of this Section 4.02, "Indemnitee" means (i) State Street and Loan Trustee, (ii) so long as it holds any Equipment Notes as agent and trustee of any Pass Through Trustee, Subordination Agent, (iii) so long as it is the holder of any Equipment Notes, each Pass Through Trustee, (iv) Liquidity Provider and Policy Provider and (v) each of their respective successors and permitted assigns in such capacities, agents, servants, officers, employees and directors (the respective agents, servants, officers, employees and directors of each of the foregoing Indemnitees, as applicable, together with such Indemnitee, being collectively the "Related Indemnitee Group" of such Indemnitee); provided that such Persons, to the extent they are not signatories to this Agreement, have expressly agreed in writing to be bound by the terms of this Section 4.02 prior to, or concurrently with, the making of a Claim. If any Indemnitee fails to comply with any duty or obligation under this Section 4.02 with respect to any Claim, such Indemnitee shall not be entitled to any indemnity with respect to such Claim under this Section 4.02 to the extent such failure was prejudicial to Company. No holder of a Pass Through Certificate in its capacity as such holder shall be an Indemnitee. (c) Claims Indemnified. Subject to the exclusions stated in Subsection 4.02(d), Company agrees to indemnify, protect, defend and hold harmless on an After-Tax Basis each Indemnitee against Claims resulting from or arising out of the sale, purchase, acceptance, non-acceptance or rejection of the Aircraft under the Purchase Agreement or the ownership, possession, use, non-use, substitution, airworthiness, control, maintenance, repair, operation, registration, re-registration, condition, sale, lease, sublease, storage, modification, alteration, return, transfer or other disposition of the Aircraft, the Airframe, any Engine or any Part (including, without limitation, latent or other defects, whether or not discoverable, and any claim for patent, trademark or copyright infringement) by Company, any Permitted Lessee or any other Person. Without limiting the foregoing and subject to, and without duplication of, the provisions of Section 6.01(a), Company agrees to pay the reasonable ongoing fees, and the reasonable out-of-pocket costs and expenses actually incurred (including, without limitation, reasonable attorney's fees and disbursements actually incurred and, to the extent payable as provided in the Indenture, reasonable compensation and expenses of Loan Trustee's agents actually incurred), of Loan Trustee in connection with the transactions contemplated hereby. (d) Claims Excluded. The following are excluded from Company's agreement to indemnify an Indemnitee under this Section 4.02: (i) any Claim to the extent such Claim is attributable to acts or events occurring after (x) the Equipment Notes have been paid in full or (y) the transfer of possession of the Aircraft pursuant to Article IV of the Indenture except to the extent that such Claim is attributable to acts occurring in connection with the exercise of remedies pursuant to Section 4.02 of the Indenture following the occurrence and continuance of an Event of Default; (ii) any Claim to the extent such Claim is, or is attributable to, a Tax; (iii) any Claim to the extent such Claim is attributable to the negligence or willful misconduct of such Indemnitee or such Indemnitee's Related Indemnitee Group; (iv) any Claim to the extent such Claim is attributable to the noncompliance by such Indemnitee or such Indemnitee's Related Indemnitee Group with any of the terms of, or any misrepresentation by an Indemnitee or its Related Indemnitee Group contained in, this Agreement, any other Operative Document or any Pass Through Document to which such Indemnitee or any of such Related Indemnitee Group is a party or any agreement relating hereto or thereto; (v) any Claim to the extent such Claim constitutes a Permitted Lien attributable to such Indemnitee; (vi) any Claim to the extent such Claim is attributable to the offer, sale, assignment, transfer, participation or other disposition (whether voluntary or involuntary) by or on behalf of such Indemnitee or its Related Indemnitee Group (other than during the occurrence and continuance of an Event of Default provided that any such offer, sale, assignment, transfer, participation or other disposition during the occurrence and continuation of an Event of Default shall not be subject to indemnification unless it is made in accordance with the Indenture and applicable law) of any Equipment Note or Pass Through Certificate, all or any part of such Indemnitee's interest in the Operative Documents or the Pass Through Documents or any interest in the Collateral or any similar security; (vii) any Claim to the extent such Claim is attributable to (A) a failure on the part of Loan Trustee to distribute in accordance with this Agreement or the Indenture any amounts received and distributable by it hereunder or thereunder, (B) a failure on the part of Subordination Agent to distribute in accordance with the Intercreditor Agreement any amounts received and distributable by it thereunder or (C) a failure on the part of any Pass Through Trustee to distribute in accordance with the Pass Through Trust Agreement to which it is a party any amounts received and distributable by it thereunder; (viii) any Claim to the extent such Claim is attributable to the authorization or giving or withholding of any future amendments, supplements, waivers or consents with respect to any Operative Document or any Pass Through Document, other than such as have been requested by Company or that occur as the result of an Event of Default, or such as are expressly required or contemplated by the provisions of the Operative Documents or the Pass Through Documents; (ix) any Claim to the extent such Claim is payable or borne by (a) Company pursuant to any indemnification, compensation or reimbursement provision of any other Operative Document or any Pass Through Document or (b) a Person other than Company pursuant to any provision of any Operative Document or any Pass Through Document; (x) any Claim to the extent such Claim is an ordinary and usual operating or overhead expense or not an out-of-pocket expense actually incurred; (xi) any Claim to the extent such Claim is incurred on account of or asserted as a result of any "prohibited transaction" within the meaning of Section 406 of ERISA or Section 4975 of the Code; (xii) any Claim to the extent such Claim is attributable to one or more of the other aircraft financed through the offering of Pass Through Certificates (in the event of doubt, any Claim shall be allocated between the Aircraft and such other aircraft in the same proportion that the then outstanding Equipment Notes bear to the then outstanding equipment notes issued with respect to the other aircraft and held by Pass Through Trustees); and (xiii) any Claim by an Indemnitee related to the status of such Indemnitee as a passenger or shipper on any of Company's aircraft or as a party to a marketing or promotional or other commercial agreement with Company. (e) Insured Claims. In the case of any Claim indemnified by Company hereunder that is covered by a policy of insurance maintained by Company, each Indemnitee agrees to cooperate, at Company's expense, with the insurers in the exercise of their rights to investigate, defend and compromise such Claim. (f) Claims Procedure. An Indemnitee shall promptly notify Company of any Claim as to which indemnification is sought. The failure to provide such prompt notice shall not release Company from any of its obligations to indemnify hereunder except to the extent that Company is prejudiced by such failure or Company's indemnification obligations are increased as a result of such failure. Such Indemnitee shall promptly submit to Company all additional information in such Indemnitee's possession to substantiate such Claim as Company reasonably requests. Subject to the rights of Company's insurers, Company may, at its sole cost and expense, investigate any Claim, and may in its sole discretion defend or compromise any Claim. At Company's expense, any Indemnitee shall cooperate with all reasonable requests of Company in connection therewith. Such Indemnitee shall not enter into a settlement or other compromise with respect to any Claim without the prior written consent of Company, which consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives its right to be indemnified with respect to such Claim. Where Company or its insurers undertake the defense of an Indemnitee with respect to a Claim, no additional legal fees or expenses of such Indemnitee in connection with the defense of such Claim shall be indemnified hereunder unless such fees or expenses were incurred at the written request of Company or such insurers. Subject to the requirements of any policy of insurance, an Indemnitee may participate at its own expense in any judicial proceeding controlled by Company pursuant to the preceding provisions; provided that such party's participation does not, in the opinion of counsel appointed by Company or its insurers to conduct such proceedings, interfere with such control. Such participation shall not constitute a waiver of the indemnification provided in this Section 4.02. Notwithstanding anything to the contrary contained herein, Company shall not under any circumstances be liable for the fees and expenses of more than one counsel for all Indemnitee with respect to any one Claim. (g) Subrogation. To the extent that a Claim is in fact paid in full by Company or its insurer, Company or such insurer (as the case may be) shall, without any further action, be subrogated to the rights and remedies of the Indemnitee on whose behalf such Claim was paid with respect to the transaction or event giving rise to such Claim. Such Indemnitee shall give such further assurances or agreements and shall cooperate with Company or such insurer, as the case may be, to permit Company or such insurer to pursue such rights and remedies, if any, to the extent reasonably requested by Company. So long as no Event of Default has occurred and is continuing, if an Indemnitee receives any payment, in whole or in part, from any party other than Company or its insurers with respect to any Claim paid by Company or its insurers, it shall promptly pay over to Company the amount received (but not an amount in excess of the amount Company or any of its insurers has paid in respect of such Claim). Any amount referred to in the preceding sentence that is payable to Company shall not be paid to Company, or, if it has been previously paid directly to Company, shall not be retained by Company, if at the time of such payment an Event of Default has occurred and is continuing, but shall be paid to and held by Loan Trustee as security for the obligations of Company under the Operative Documents. If Company agrees, such amount payable shall be applied against Company's obligations thereunder when and as they become due and payable. At such time as such Event of Default is no longer continuing, such amount, to the extent not previously so applied against Company's obligations, shall be paid to Company. If any such amount has been so held by Loan Trustee as security for more than 90 days after any such Event of Default has occurred, during which period (i) Loan Trustee was not limited by operation of law or otherwise from exercising remedies under the Indenture and (ii) Loan Trustee did not exercise any remedy available to it under Section 4.02 of the Indenture, then any remaining amount shall be paid to Company. (h) No Guaranty. Nothing set forth in this Section 4.02 constitutes a guarantee by Company that the Aircraft at any time will have any particular value, useful life or residual value. (i) Payments; Interest. Any amount payable to any Indemnitee on account of a Claim shall be paid within 30 days after receipt by Company of a written demand therefor from such Indemnitee accompanied by a written statement describing in reasonable detail the Claims that are the subject of and basis for such indemnity and the computation of the amount payable. Any payments made pursuant to this Section 4.02 directly to an Indemnitee or to Company, as the case may be, shall be made in immediately available funds at such bank or to such account as is specified by the payee in written directions to the payor or, if no such directions are given, by check of the payor payable to the order of the payee and mailed to the payee by certified mail, return receipt requested, postage prepaid to its address referred to in Section 7.01. To the extent permitted by applicable law, interest at the Past Due Rate shall be paid, on demand, on any amount or indemnity not paid when due pursuant to this Section 4.02 until the same is paid. Such interest shall be paid in the same manner as the unpaid amount in respect of which such interest is due. (j) Tax deduction or credit. If, by reason of any Claim payment made to or for the account of an Indemnitee by Company pursuant to this Section 4.02, such Indemnitee subsequently realizes a tax deduction or credit (including foreign tax credit and any reduction in Taxes) not previously taken into account in computing such payment, such Indemnitee shall promptly pay to Company, but only if Company has made all payments then due and owing to such Indemnitee under the Operative Documents, an amount equal to the sum of (1) the actual reduction in Taxes realized by such Indemnitee which is attributable to such deduction or credit, and (2) the actual reduction in Taxes realized by such Indemnitee as a result of any payment made by such Indemnitee pursuant to this sentence. ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF STATE STREET Section 5.01 Representations, Warranties and Covenants of State Street. State Street, generally, and each of Loan Trustee, Subordination Agent and Pass Through Trustee as it relates to it, represents, warrants and covenants that: (a) State Street is a national banking association duly organized and validly existing in good standing under the laws of the United States, is eligible to be Loan Trustee under Section 8.01(a) of the Indenture, will promptly comply with Section 8.01(a) of the Indenture and has full power, authority and legal right to enter into and perform its obligations under each of the Operative Documents and the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party and, in its capacity as Loan Trustee and Pass Through Trustee, respectively, to authenticate the Equipment Notes and the Pass Through Certificates, respectively. State Street is qualified to act as Loan Trustee under Section 8.01(c) of the Indenture. (b) The execution, delivery and performance by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, each of the other Operative Documents and each of the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, and the authentication of the Equipment Notes and the Pass Through Certificates, respectively, to be delivered on the Closing Date, have been duly authorized by all necessary action on the part of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee, as the case may be, and do not violate any law or regulation of the United States or of the state of the United States in which State Street is located and which governs the banking and trust powers of State Street or any order, writ, judgment or decree of any court, arbitrator or governmental authority applicable to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee or any of their assets, will not violate any provision of the articles of association or by-laws of State Street and will not violate any provision of, or constitute a default under, any mortgage, indenture, contract, agreement or undertaking to which any of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party or by which any of them or their respective properties may be bound or affected. (c) Neither the execution and delivery by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, any other Operative Document or any Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, nor the consummation by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with, or the taking of any other action in respect of, any governmental authority or agency of the United States or the state of the United States where State Street is located and regulating the banking and trust powers of State Street. (d) This Agreement, each other Operative Document and each Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party have been duly executed and delivered by State Street, individually and in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, and constitute the legal, valid and binding obligations of State Street, Loan Trustee, Subordination Agent and such Pass Through Trustee, as the case may be, enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. (e) It unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Loan Trustee Lien or Other Party Lien attributable to it, and it agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Lien; and it shall indemnify, protect, defend and hold harmless each Indemnitee and Company against Claims in any way resulting from or arising out of a breach by it of its obligations under this Section 5.01(e). (f) The Equipment Notes to be issued to Subordination Agent pursuant hereto are being acquired by it to be held under the Intercreditor Agreement. (g) Each of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee agrees that it will not impose any lifting charge, cable charge, remittance charge or any other charge or fee on any transfer by Company of funds to, through or by State Street, Loan Trustee, Subordination Agent or such Pass Through Trustee pursuant to this Agreement, any other Operative Document or any Pass Through Document, except as may be otherwise agreed to in writing by Company. (h) Each of State Street, Loan Trustee, Subordination Agent and any Pass Through Trustee agrees to be bound by the terms of Section 10.16 of the Indenture. (i) There are no Taxes payable by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee imposed by the State of Connecticut or any political subdivision or taxing authority thereof in connection with the execution, delivery or performance by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any Operative Document or any Pass Through Document (other than franchise or other taxes based on or measured by any fees or compensation received by any such Person for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents), and there are no Taxes payable by any Pass Through Trustee imposed by the State of Connecticut or any political subdivision thereof in connection with the acquisition, possession or ownership by such Pass Through Trustee of any of the Equipment Notes (other than franchise or other taxes based on or measured by any fees or compensation received by such Pass Through Trustee for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents) and, assuming that the Pass Through Trusts will not be taxable for Federal income tax purposes as corporations, but, rather, will be characterized for such purposes as grantor trusts or partnerships, the Pass Through Trusts will not be subject to any Taxes imposed by the State of Connecticut or any political subdivision thereof. (j) Except with the consent of Company, which shall not be unreasonably withheld, State Street will act as Pass Through Trustee solely through its offices within the State of Connecticut, except for such services that may be performed for it by various agents, but not directly by it, in other states. (k) There are no pending or, to its knowledge, threatened actions or proceedings against State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee before any court or administrative agency which individually or in the aggregate, if determined adversely to it, would materially adversely affect the ability of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee to perform its obligations under any Operative Document or any Pass Through Document. (l) The representations and warranties contained in Section 7.15 of each Pass Through Trust Agreement are true, complete and correct as of the Closing Date. ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements. (a) Company agrees promptly to pay (without duplication of any other obligation Company may have to pay such amounts) (A) the initial and annual fees and (to the extent Loan Trustee is entitled to be reimbursed for its reasonable expenses) the reasonable expenses of Loan Trustee in connection with the transactions contemplated hereby and (B) the following expenses incurred by Loan Trustee, Subordination Agent and Pass Through Trustees in connection with the negotiation, preparation, execution and delivery of this Agreement, the other Operative Documents and the other documents or instruments referred to herein or therein: (i) the reasonable fees, expenses and disbursements of (x) Bingham Dana LLP, special counsel for Loan Trustee, Subordination Agent and Pass Through Trustees and (y) Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma, in each case to the extent actually incurred; and (ii) all reasonable expenses incurred in connection with printing and document production or reproduction expenses, and in connection with the filing of Uniform Commercial Code financing statements. (b) Loan Trustee, Noteholders, Subordination Agent and each Pass Through Trustee agree to execute and deliver, at Company's expense, all such documents as Company reasonably requests for the purpose of continuing the registration of the Aircraft at the FAA in Company's name. In addition, each of Loan Trustee, Subordination Agent, each Pass Through Trustee and any other Noteholder agrees, for the benefit of Company, to cooperate with Company in effecting any foreign registration of the Aircraft pursuant to Section 7.02(e) of the Indenture; provided that prior to any such change in the country of registry of the Aircraft the conditions set forth in Section 7.02(e) of the Indenture are met to the reasonable satisfaction of, or waived by, Loan Trustee. (c) Each of State Street, Loan Trustee, Subordination Agent, each Pass Through Trustee and any other Noteholder agrees that, unless an Event of Default shall have occurred and be continuing, it shall not take any action contrary to, or otherwise in any way interfere with or disturb (and then only in accordance with the Indenture), the quiet enjoyment of the use and possession of the Aircraft, the Airframe, any Engine or any Part by Company or any transferee of any interest in any thereof permitted under the Indenture. (d) Each Noteholder, including, without limitation, Subordination Agent and each Pass Through Trustee, unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Noteholder Liens, and such Noteholder agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Noteholder Lien; and each Noteholder hereby agrees to indemnify, protect, defend and hold harmless each Indemnitee and Company against Claims in any way resulting from or arising out of a breach by it of its obligations under this Section 6.01(d). (e) By its acceptance of its Equipment Notes, each Noteholder (i) unconditionally agrees for the benefit of Company and Loan Trustee to be bound by and to perform and comply with all of the terms of such Equipment Notes, the Indenture and this Agreement applicable to such Noteholder and (ii) agrees that it will not transfer any Equipment Note (or any part thereof) to any entity unless such entity makes (or is deemed to have made) a representation and warranty as of the date of transfer that either no part of the funds to be used by it for the purchase and holding of such Equipment Note (or any part thereof) constitutes assets of any "employee benefit plan" or that such purchase and holding will not result in a non-exempt prohibited transaction under Section 4975 of the Code and Section 406 of ERISA. (f) Each of Company, Loan Trustee, each Pass Through Trustee and Subordination Agent covenants that (i) until one year and one day after the Series G-1 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-1 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-1 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-1 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-1 Pass Through Trust, (ii) until one year and one day after the Series G-2 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-2 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-2 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-2 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-2 Pass Through Trust, and (iii) until one year and one day after the Series C Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class C Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class C Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class C Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class C Pass Through Trust. Section 6.02 Certain Covenants of Company. Company covenants and agrees with Loan Trustee as follows: (a) On and after the Closing, Company will cause to be done, executed, acknowledged and delivered such further acts, conveyances and assurances as Loan Trustee reasonably requests for accomplishing the purposes of this Agreement and the other Operative Documents; provided that any instrument or other document so executed by Company will not expand any obligations or limit any rights of Company in respect of the transactions contemplated by the Operative Documents. (b) Company will cause the Indenture (with the Indenture Supplement covering the Aircraft attached) to be promptly filed and recorded, or filed for recording, with the FAA to the extent permitted under the Transportation Code and the rules and regulations of the FAA thereunder. (c) Company, at its expense, will take, or cause to be taken, such action with respect to the recording, filing, re-recording and refiling of the Indenture and any financing statements or other instruments as are necessary to maintain, so long as the Indenture is in effect, the perfection of the security interests created by the Indenture or will furnish Loan Trustee timely notice of the necessity of such action, together with such instruments, in execution form, and such other information as may be required to enable Loan Trustee to take such action. In addition, Company will pay any and all recording, stamp and other similar taxes payable in the United States, and in any other jurisdiction where the Aircraft is registered, in connection with the execution, delivery, recording, filing, re-recording and refiling of the Indenture or any such financing statements or other instruments. Company will notify Loan Trustee of any change in its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Delaware) promptly after making such change or in any event within the period of time necessary under applicable law to prevent the lapse of perfection (absent refiling) of financing statements filed under the Operative Documents. (d) Company shall at all times maintain its corporate existence except as permitted by Subsection 6.02(e). (e) Company shall not consolidate with or merge into any other Person or convey, transfer or lease substantially all of its assets as an entirety to any Person, unless: (i) the successor or transferee entity shall, if and to the extent required under Section 1110 in order that Loan Trustee continues to be entitled to any benefits of Section 1110 with respect to the Aircraft, be a Citizen of the United States and a Certificated Air Carrier and shall execute and deliver to Loan Trustee an agreement containing the express assumption by such successor or transferee entity of the due and punctual performance and observance of each covenant and condition of the Operative Documents to which Company is a party to be performed or observed by Company; (ii) immediately after giving effect to such transaction, no Event of Default shall have occurred and be continuing; and (iii) Company shall deliver to Loan Trustee a certificate signed by a Responsible Officer of Company, and an opinion of counsel (which may be internal counsel to Company), each stating that such consolidation, merger, conveyance, transfer or lease and the assumption agreement mentioned in clause (i) above comply with this Subsection 6.02(e) and that all conditions precedent herein relating to such transaction have been complied with (except that such opinion need not cover the matters referred to in clause (ii) above and may rely, as to factual matters, on a certificate of an officer of Company) and, in the case of such opinion, that such assumption agreement has been duly authorized, executed and delivered by such successor Person and is enforceable against such successor Person in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. Upon any consolidation or merger, or any conveyance, transfer or lease of substantially all of the assets of Company as an entirety in accordance with this Subsection 6.02(e), the successor Person formed by such consolidation or into which Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, Company under this Agreement and the other Operative Documents with the same effect as if such successor Person had been named as Company herein. (f) Company shall remain a Certificated Air Carrier for as long as and to the extent required under Section 1110 in order that Loan Trustee shall be entitled to any of the benefits of Section 1110 with respect to the Aircraft. ARTICLE 7 MISCELLANEOUS Section 7.01 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and any such notice may be given by registered or certified United States mail, courier service or facsimile or any other customary means of communication, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: if to Company, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 733-1657 if to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee, addressed to: State Street Bank And Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Facsimile: (860) 244-1881 or if to any subsequent Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 of the Indenture. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 7.01. Section 7.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements. Except as otherwise provided herein, the representations, warranties, indemnities, covenants and agreements of Company, State Street, Loan Trustee, Subordination Agent, each Pass Through Trustee and Noteholders herein, and each of their obligations hereunder, shall survive the making of the loans and the expiration or termination (to the extent arising out of acts or events occurring prior to such expiration) of any Operative Documents. Section 7.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.04 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 hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 7.05 No Oral Modifications or Continuing Waivers; Consents. Subject to Section 9.03 of the Indenture, 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 against which the enforcement of the change, waiver, discharge or termination is sought. No such change, waiver, discharge or termination shall be effective unless a signed copy thereof is delivered to Loan Trustee. Each Pass Through Trustee and, by its acceptance of an Equipment Note, each subsequent Noteholder covenants and agrees that it shall not unreasonably withhold its consent to any consent of Loan Trustee requested by Company under the Indenture. Section 7.06 Effect of Headings and Table of Contents. The headings of the various Articles and Sections herein and in the Table of Contents are for convenience of reference only and do not define or limit any of the terms or provisions hereof. Section 7.07 Successors and Assigns. All covenants, agreements, representations and warranties in this Agreement by Company, by State Street, individually or as Loan Trustee, Subordination Agent or Pass Through Trustee, or by any Noteholder, shall bind and inure to the benefit of and be enforceable by Company, and subject to the terms of Section 6.02(e), its successors and permitted assigns, each Pass Through Trustee and any successor or other trustee under the Pass Through Trust Agreement to which it is a party, Subordination Agent and its successor under the Intercreditor Agreement and Loan Trustee and its successor under the Indenture, whether so expressed or not. Section 7.08 Benefits of Agreement. Nothing in this Agreement, express or implied, gives to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy or claim under this Agreement, except as expressly provided herein. Company agrees and acknowledges that Liquidity Provider and Policy Provider shall be third party beneficiaries of the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and the indemnities contained in Section 4.02 and may rely on the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and such indemnities to the same extent as if the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and such indemnities were made to Liquidity Provider and Policy Provider directly. Section 7.09 Counterparts. This Agreement may be executed in any number of counterparts. Each of the parties hereto shall not be required to execute the same counterpart. Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts shall together constitute one instrument. Section 7.10 Submission to Jurisdiction. Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Documents hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. Section 7.11 Sale/Leaseback Transaction. Notwithstanding anything to the contrary contained herein or in any other Operative Document, so long as no Event of Default (or an event or condition that, with the passage of time or notice, or both, would constitute an Event of Default) has occurred and is continuing, upon not less than five days' prior written notice to the parties hereto, Company shall have the right to sell the Aircraft and transfer title to the Aircraft to an owner trustee for the benefit of an owner participant (which shall be a "Transferee" (as defined in the Participation Agreement Form)) in a transaction in which such owner trustee assumes all of the obligations of Company under the Equipment Notes and the Indenture on a non-recourse basis (with Company being released from such obligations, except to the extent accrued prior thereto), leases the Aircraft to Company and assigns such lease to Loan Trustee pursuant to an amended and restated indenture (a "Sale/Leaseback Transaction"). In connection with such Sale/Leaseback Transaction, each of the parties hereto and each Noteholder will execute and deliver appropriate documentation permitting the owner trustee to assume the obligations of Company under the Equipment Notes and the Indenture on a non-recourse basis, releasing Company from all obligations in respect of the Equipment Notes and the Indenture (except to the extent accrued prior thereto), and take all other actions as are reasonably necessary to permit such assumption by the owner trustee. In connection with any such Sale/Leaseback Transaction, the parties agree that (a) the documents to be utilized shall be (i) an amended and restated participation agreement (N372DA) amending and restating this Agreement, such amended and restated participation agreement to be substantially in the Participation Agreement Form, among the parties hereto, any Noteholder which is not a party hereto, the owner trustee and the owner participant, with such changes as do not vary the Mandatory Economic Terms or the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L), (ii) a lease agreement (N372DA), such lease agreement to be substantially in the Lease Form, between the owner trustee and Company with such changes to such form as do not vary the Mandatory Economic Terms or the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L), (iii) an amended and restated indenture (N372DA) amending and restating the Indenture, such amended and restated indenture to be substantially in the Indenture Form, with such changes to such form as do not vary the Mandatory Economic Terms or the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L), (iv) a purchase agreement assignment (N372DA), such purchase agreement assignment to be substantially in the form of Exhibit J between Company and the owner trustee with such changes to such form as do not vary the Mandatory Economic Terms or the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L) and (v) a trust agreement (N372DA), such trust agreement to be substantially in the form of Exhibit K between the owner trustee and the owner participant with such changes to such form as do not vary the Mandatory Economic Terms or the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L hereto), (b) Company shall deliver a certificate to each Pass Through Trustee, Liquidity Provider and Policy Provider stating that (i) such amended and restated participation agreement and such other agreements described in subclauses (ii) through (v) of the preceding clause (a) do not vary the Mandatory Economic Terms and contain the Mandatory Document Terms (except as such Mandatory Document Terms may be modified in accordance with Exhibit L hereto) and (ii) any modification of such agreements described in subclauses (i) through (v) of the preceding clause (a) from the forms thereof attached to this Agreement do not materially and adversely affect Liquidity Provider, Policy Provider or the holders of the Pass Through Certificates, and such certification shall be true and correct and (c) the Equipment Notes shall be delivered to Loan Trustee for cancellation in exchange for new equipment notes to be issued to Noteholders by the owner trustee, such new equipment notes to be substantially in the form contained in Section 2.01 of the form of amended and restated indenture attached hereto as Exhibit I. Such new equipment notes will have the same payment terms as the Equipment Notes except that in the event that Company enters into a Sale/Leaseback Transaction prior to May 1, 2003, Company shall have the right to reoptimize the new equipment notes (by changing the maturity date and/or the principal payment requirements thereof) to be issued to Noteholders by the owner trustee in compliance with the Mandatory Economic Terms. The parties agree that if, in connection with the entering into of a Sale/Leaseback Transaction, any owner participant who is to be party to any of the agreements described in subclauses (i) through (v) of clause (a) of the second preceding sentence shall not be a Citizen of the United States, then the agreements described in subclauses (i) through (v) of clause (a) of the second preceding sentence shall be modified, consistent with the Mandatory Document Terms (as such Mandatory Document Terms may be modified in accordance with Exhibit L), to require such owner participant to enter into a voting trust, voting powers or similar arrangement satisfactory to Company that (A) enables the Aircraft to be registered in the United States and (B) complies with the FAA regulations issued under the Transportation Code applicable thereto. Notwithstanding the foregoing, Company shall not have the right to enter into a Sale/Leaseback Transaction unless (a) Company causes to be delivered to Loan Trustee an opinion of counsel to the effect that holders of Pass Through Certificates will not recognize income, gain or loss for federal income tax purposes as a result of such assumption and release and will be subject to federal income tax in the same amounts, in the same manner and at the same time as would have been the case if such assumption and release had not occurred (other than such change in amount, manner and timing of interest that results from any reoptimization of new equipment notes permitted pursuant to this Section 7.11) and that the Pass Through Trusts will not be subject to federal income taxation as a result of such assumption and release and (b) written confirmation from each Rating Agency that the Sale/Leaseback Transaction and/or reoptimization of the new equipment notes in connection therewith will not result in a withdrawal, suspension or downgrading of the ratings of any class of Pass Through Certificates (without regard to the Policy (as defined in the Policy Provider Agreement)). IN WITNESS WHEREOF, the parties hereto have caused this Participation Agreement to be duly executed by their respective officers thereunto duly authorized as of the date first above written. DELTA AIR LINES, INC. By:____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements By:____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By:____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By:____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein By:____________________________________ Name: Title: SCHEDULE I to PARTICIPATION AGREEMENT EQUIPMENT NOTES, PURCHASERS AND ORIGINAL PRINCIPAL AMOUNTS
Description of Original Principal Purchaser Equipment Notes Maturity Interest Rate Amount - ------------------------------------------------------------------------------------------------------------------------------------ Delta Air Lines Pass Through Series 2002-1G-1 January 2, 2022 6.718% $19,985,061.21 Trust 2002-1G-1 Equipment Note EN-1G1-001 Delta Air Lines Pass Through Series 2002-1G-2 July 2, 2012 6.417% $1,073,800.00 Trust 2002-1G-2 Equipment Note EN-1G2-001 Delta Air Lines Pass Through Series 2002-1C January 2, 2011 7.779% $4,602,000.00 Trust 2002-1C Equipment Note EN-1C-001
SCHEDULE II to PARTICIPATION AGREEMENT TRUST SUPPLEMENTS Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-1. Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-2. Trust Supplement No. 2002-1C, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1C. EXHIBIT A-1 to PARTICIPATION AGREEMENT FORM OF OPINION OF COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT A-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT A-3 to PARTICIPATION AGREEMENT FORM OF ss. 1110 OPINION OF SPECIAL COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT B to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LOAN TRUSTEE, SUBORDINATION AGENT AND STATE STREET [Intentionally Omitted] EXHIBIT C to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL FAA COUNSEL [Intentionally Omitted] EXHIBIT D-1to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LIQUIDITY PROVIDER [Intentionally Omitted] EXHIBIT D-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF GERMAN IN-HOUSE COUNSEL FOR LIQUIDITY PROVIDER [Intentionally Omitted] EXHIBIT E to PARTICIPATION AGREEMENT FORM OF MANUFACTURER'S CONSENT [Intentionally Omitted] EXHIBIT F TO PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR PASS THROUGH TRUSTEES [Intentionally Omitted] EXHIBIT G TO PARTICIPATION AGREEMENT FORM OF AMENDED AND RESTATED PARTICIPATION AGREEMENT ================================================================================ AMENDED AND RESTATED PARTICIPATION AGREEMENT (N[_____]) Dated as of _____ __, 200_ among DELTA AIR LINES, INC., as Lessee [____________________], as Owner Participant STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its Individual Capacity, except as expressly provided herein, but solely as Owner Trustee STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein --------------- One Boeing 737-832 Aircraft U.S. Registration No. N[_____] ================================================================================ TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS Section 1.01 Definitions................................................... Section 1.02 Other Definitional Provisions................................. ARTICLE 2 PARTICIPATIONS IN LESSOR'S COST OF THE AIRCRAFT Section 2.01 Participation by Pass Through Trustee......................... Section 2.02 Participation by Owner Participant............................ Section 2.03 General Provisions............................................ Section 2.04 The Closing................................................... ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to the Participations in the Aircraft.... Section 3.02 Conditions Precedent to Obligations of Lessee................. ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF LESSEE Section 4.01 Representations and Warranties of Lessee...................... Section 4.02 General Tax Indemnity......................................... Section 4.03 General Indemnity............................................. ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF OTHER PARTIES Section 5.01 Representations, Warranties and Covenants of State Street..... Section 5.02 Representations, Warranties and Covenants of Owner Participant.................................................. Section 5.03 Representations, Warranties and Covenants of Owner Trustee.... Section 5.04 Representations, Warranties and Covenants of Noteholders...... ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements.............................................. Section 6.02 Certain Covenants of Lessee................................... ARTICLE 7 OWNER FOR TAX PURPOSES Section 7.01 Owner for Federal Tax Purposes................................ ARTICLE 8 SITUS OF THE OWNER TRUST Section 8.01 Change of Situs of Owner Trust................................ ARTICLE 9 INSTRUCTIONS TO OWNER TRUSTEE Section 9.01 Instructions to Owner Trustee................................. ARTICLE 10 INTEREST OF NOTEHOLDERS Section 10.01 Extent of Interest of Noteholders............................. ARTICLE 11 EXCESS AMOUNT Section 11.01 Excess Amount................................................. ARTICLE 12 TRANSACTION EXPENSES Section 12.01 Invoices and Payment.......................................... Section 12.02 Payment of Other Expenses..................................... ARTICLE 13 REFINANCINGS Section 13.01 Refinancings.................................................. ARTICLE 14 RELEASE OF COLLATERAL Section 14.01 Release of Collateral, Assumption and Release................. ARTICLE 15 DELIVERY DATE INTEREST PAYMENT Section 15.01 Delivery Date Interest Payment................................ ARTICLE 16 MISCELLANEOUS Section 16.01 Notices....................................................... Section 16.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements..................................... Section 16.03 Governing Law................................................. Section 16.04 Severability.................................................. Section 16.05 No Oral Modifications or Continuing Waivers; Consents......... Section 16.06 Effect of Headings and Table of Contents...................... Section 16.07 Successors and Assigns........................................ Section 16.08 Benefits of Agreement......................................... Section 16.09 Counterparts.................................................. Section 16.10 Submission to Jurisdiction.................................... Section 16.11 Obligations of Owner Trustee.................................. Section 16.12 Payments to Owner Participant................................. Section 16.13 Section 1110.................................................. Schedule I - Commitments Schedule II - Trust Supplements Exhibit A-1 - Form of Opinion of Counsel for Lessee Exhibit A-2 - Form of Opinion of Cadwalader, Wickersham & Taft, special counsel for Lessee Exhibit A-3 - Form ofss. 1110 Opinion of Cadwalader, Wickersham & Taft, special counsel for Lessee Exhibit B - Form of Opinion of Special Counsel for Loan Trustee, Subordination Agent and State Street Exhibit C - Form of Opinion of Special FAA Counsel Exhibit D - Form of Opinion of Ray, Quinney and Nebeker, special counsel for Owner Trustee Exhibit E-1 - Form of Opinion of [_______], special counsel for Owner Participant Exhibit E-2 - Form of Opinion of in-house counsel for Owner Participant Exhibit F - Form of Opinion of counsel for Manufacturer Exhibit G - Form of Opinion of Special Counsel for Pass Through Trustees Exhibit H - Form of Opinion of Cadwalader, Wickersham & Taft, special counsel for Lessee, pursuant to Section 7.11 of the Original Participation Agreement Exhibit I - Schedule of Countries Exhibit J - Return Conditions Annex A - Definitions AMENDED AND RESTATED PARTICIPATION AGREEMENT (N[_____]) This AMENDED AND RESTATED PARTICIPATION AGREEMENT (N[_____]), dated as of _____ __, 200_, is made by and among DELTA AIR LINES, INC., a Delaware corporation (together with its successors and permitted assigns, "Lessee"), [______________], a [_________] corporation ("Owner Participant"), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association (in its individual capacity, together with its successors and permitted assigns, "State Street"), not in its individual capacity except as otherwise expressly provided in any of the Operative Documents or the Pass Through Documents, but solely as trustee (in such capacity together with any successor or other trustee in such capacity, "Pass Through Trustee") under each of the Pass Through Trust Agreements (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01), WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity, except as expressly provided herein, but solely as Owner Trustee under the Trust Agreement (herein, in such latter capacity, together with any successor owner trustee, called "Owner Trustee"), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as subordination agent and trustee (in such capacity, together with any successor trustee in such capacity, "Subordination Agent") under the Intercreditor Agreement, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as loan trustee (in such capacity, together with any successor trustee in such capacity, "Loan Trustee") under the Indenture (as hereinafter defined), does amend and restate in its entirety the Participation Agreement (N[_____]), dated as of April 30, 2002, among Lessee, Pass Through Trustee, Subordination Agent and Loan Trustee (the "Original Participation Agreement"; and as so amended and restated hereby, the "Agreement"). W I T N E S S E T H: WHEREAS, pursuant to the Purchase Agreement between Lessee and Manufacturer, Manufacturer agreed to sell to Lessee certain Boeing Model 737-832 aircraft, including the Aircraft which has been delivered by Manufacturer to Lessee and is the subject of this Agreement; WHEREAS, pursuant to the Basic Pass Through Trust Agreement and each of the Trust Supplements set forth in Schedule II, on the Issuance Date separate Pass Through Trusts were created to facilitate certain of the transactions contemplated hereby, including, without limitation, the issuance and sale of Pass Through Certificates; WHEREAS, on the Issuance Date, (i) Liquidity Provider entered into the Liquidity Facilities, (ii) Policy Provider entered into the Policy Provider Agreement, and (iii) Pass Through Trustee, Liquidity Provider, Policy Provider and Subordination Agent entered into to the Intercreditor Agreement; WHEREAS, the proceeds from the issuance and sale of the Pass Through Certificates were applied in part by Pass Through Trustee on April 30, 2002 to purchase from Lessee, on behalf of each Pass Through Trust, all of the Equipment Notes (the "Original Equipment Notes") issued by Lessee pursuant to the Original Indenture bearing the same interest rate as the Pass Through Certificates issued by such Pass Through Trust; WHEREAS, the Original Equipment Notes were registered in the name of, and held by, Subordination Agent pursuant to the Intercreditor Agreement on behalf of the Pass Through Trusts; WHEREAS, the aggregate purchase price of the Original Equipment Notes paid by Pass Through Trustee for each Pass Through Trust for the Original Equipment Notes is set forth on Schedule I to the Original Participation Agreement opposite the name of such Pass Through Trust; WHEREAS, pursuant to Section 7.11 of the Original Participation Agreement, the parties to the Original Participation Agreement contemplated amending and restating the Original Participation Agreement by entering into this Agreement; WHEREAS, concurrently with the execution and delivery of this Agreement, Owner Participant is entering into the Trust Agreement with Owner Trustee, pursuant to which Owner Trustee agrees, among other things, to hold the Trust Estate (defined in Section 1.01 thereof and herein called the "Trust Estate") for the use and benefit of Owner Participant; WHEREAS, concurrently with the execution and delivery of this Agreement, Loan Trustee and Owner Trustee are entering into the Amended and Restated Indenture, pursuant to which, among other things, Owner Trustee will issue new Equipment Notes (the "Assumed Equipment Notes", and individually, an "Assumed Equipment Note") in three series, which Assumed Equipment Notes are to be secured by a security interest in all right, title and interest of Owner Trustee in and to the Aircraft and certain other property described in the Indenture in favor of Loan Trustee; WHEREAS, the Assumed Equipment Notes will be held by Subordination Agent pursuant to the Intercreditor Agreement on behalf of the Pass Through Trusts; WHEREAS, concurrently with the execution and delivery of this Agreement, Owner Trustee and Lessee have entered into the Lease, whereby, subject to the terms and conditions set forth therein, Owner Trustee agrees to lease the Aircraft to Lessee, and Lessee agrees to lease the Aircraft from Owner Trustee on the date (the "Delivery Date") that the Aircraft is sold and delivered by Lessee to Owner Trustee under the Bill of Sale, and accepted by Owner Trustee for all purposes of the Lease, such lease to be evidenced by the execution and delivery of a Lease Supplement covering the Aircraft; WHEREAS, concurrently with the execution and delivery of this Agreement, Owner Participant is entering into the Tax Indemnity Agreement with Lessee; and WHEREAS, concurrently with the execution and delivery of this Agreement, Lessee and Owner Trustee are entering into the Purchase Agreement Assignment; and Manufacturer has executed the Manufacturer's Consent; and NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS Section 1.01 Definitions. For the purposes of this Agreement, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) All references in this Agreement to a "government" are to such government and any instrumentality or agency thereof. (e) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". (f) Unless the context requires otherwise, any reference herein to any Operative Document refers to such document as it may be amended from time to time. ARTICLE 2 PARTICIPATIONS IN LESSOR'S COST OF THE AIRCRAFT Section 2.01 Participation by Pass Through Trustee. Subject to the terms and conditions of this Agreement, Pass Through Trustee for each Pass Through Trust agrees to finance, in part, Owner Trustee's payment of Lessor's Cost for the Aircraft by consenting to the assumption by Owner Trustee of the Original Indenture and the Original Equipment Notes in accordance with the terms and conditions of the Amended and Restated Indenture (with an unpaid principal amount as set forth on Schedule I opposite the name of such Pass Through Trust) and releasing Lessee from certain of Lessee's liabilities and obligations under the Original Indenture and the Original Equipment Notes as provided in Section 14.01, which consent shall be evidenced by the surrender of the Original Equipment Notes by Subordination Agent (on behalf of Pass Through Trustee of each Pass Through Trust) to Loan Trustee for cancellation. Upon the delivery of the above consent by Pass Through Trustee for each Pass Through Trust, and the delivery of the Original Equipment Notes by Subordination Agent to Loan Trustee for cancellation, Owner Trustee shall, at the direction of Owner Participant, pursuant to and in accordance with Article II of the Amended and Restated Indenture, issue to Subordination Agent as agent and trustee for Pass Through Trustee for each Pass Through Trust, the Assumed Equipment Notes having the maturity and aggregate principal amount and bearing the interest rate set forth in Schedule I opposite the name of such Pass Through Trust. Each such Assumed Equipment Note shall be duly authenticated by Loan Trustee pursuant to the Amended and Restated Indenture, registered in the name of Subordination Agent and dated the Delivery Date and shall be delivered by Loan Trustee to Subordination Agent. Section 2.02 Participation by Owner Participant. Subject to the terms and conditions of this Agreement, Owner Participant hereby agrees to participate in the payment of Lessor's Cost for the Aircraft by making an equity investment in the beneficial ownership of the Aircraft on the Delivery Date, by transferring to the account of Owner Trustee at State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110, ABA No. 011-000-028, Account No. 9903-990-1, Reference: Delta (N[_____]), no later than 9:30 a.m. (New York City time) on the Delivery Date in immediately available funds in Dollars, the amount set forth opposite the name of Owner Participant on Schedule I. Section 2.03 General Provisions. The amount of the participation of each of Pass Through Trustee and Owner Participant to be made as provided above in the financing or payment of Lessor's Cost for the Aircraft is hereinafter called such party's "Commitment" for the Aircraft. If either of Pass Through Trustee or Owner Participant defaults in its obligations pursuant to this Article 2, the other party shall have no obligation to make any portion of such defaulted amount available or to increase the amount of its Commitment and the obligation of such nondefaulting party shall remain subject to the terms and conditions set forth in this Agreement. Upon receipt by Owner Trustee of all amounts to be furnished to it on the Delivery Date pursuant to this Article 2, Owner Trustee's assumption of the Original Indenture and the Original Equipment Notes, Lessee's release from the Original Indenture and the Original Equipment Notes as provided in Article 14 and the satisfaction of the conditions set forth in Article 3, Lessee shall transfer title to and deliver the Aircraft to Owner Trustee, and Owner Trustee shall purchase and take title to and accept delivery of the Aircraft. In consideration of the transfer of title to and delivery of the Aircraft to Owner Trustee, Owner Trustee shall, simultaneously with such transfer of title and delivery, pay to Lessee Lessor's Cost for the Aircraft by paying to Lessee the amount so furnished to it by Owner Participant, and by assuming the Original Indenture and the Original Equipment Notes as provided in Article 14. Section 2.04 The Closing. The closing (the "Closing") of the transactions contemplated hereby shall take place at the offices of Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York at 9:30 a.m. (New York City time) on [_______ __, 200_], or at such other time or place as the parties shall agree. ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to the Participations in the Aircraft. The obligations of each Pass Through Trustee and Owner Participant to participate in the financing or payment of Lessor's Cost and to make available the amount of its respective Commitment as contemplated by Article 2 are subject to the fulfillment (or the waiver by such Pass Through Trustee or Owner Participant, as applicable) prior to or on the Delivery Date of the following conditions precedent, except that Subsections (b), (d)(vii), (n), (v), (w), (x) and (bb) shall not be a condition precedent to the obligations of Pass Through Trustee, and Subsections (c), (f)(vi), (l), (r), (z) and (aa) shall not be a condition precedent to the obligations of Owner Participant: (a) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Pass Through Trustee or Owner Participant to make its Commitment available as contemplated by Section 2.01 or Section 2.02. (b) In the case of Owner Participant, each Pass Through Trustee shall have made available the amount of its Commitment for the Aircraft in accordance with Article 2. (c) In the case of Pass Through Trustee, Owner Participant shall have made available the amount of its Commitment for the Aircraft in accordance with Article 2. (d) This Agreement and the following documents shall have been duly authorized, executed and delivered by the respective party or parties thereto, shall be in full force and effect and executed counterparts thereof (or copies where indicated) shall have been delivered to each Pass Through Trustee and Owner Participant or their respective counsel, provided that: (1) only Subordination Agent on behalf of each Pass Through Trustee shall receive an executed original of such Pass Through Trustee's respective Assumed Equipment Note, (2) the chattel paper counterpart of the Lease and the Lease Supplement covering the Aircraft dated the Delivery Date shall be delivered to Loan Trustee, and (3) the Tax Indemnity Agreement need only be satisfactory to Owner Participant and Lessee and the Tax Indemnity Agreement shall only be delivered to Lessee and Owner Participant and their respective counsel: (i) an excerpted copy of the Purchase Agreement as it relates to Warranty Rights; (ii) the Purchase Agreement Assignment; (iii) the Manufacturer's Consent; (iv) the Lease; (v) a Lease Supplement covering the Aircraft dated the Delivery Date; (vi) the Trust Agreement; (vii) the Tax Indemnity Agreement; (viii) the FAA Bill of Sale; (ix) the Bill of Sale; (x) the Amended and Restated Indenture; (xi) an Indenture Supplement covering the Aircraft dated the Delivery Date; and (xii) the Assumed Equipment Notes. In addition, Pass Through Trustee and Owner Participant each shall have received executed counterparts or conformed copies of the following documents: (xiii) each of the Pass Through Trust Agreements; (xiv) the Intercreditor Agreement; (xv) the Liquidity Facilities; (xvi) the Policy Provider Agreement; (xvii) the Original Participation Agreement; and (xviii) the Original Indenture. (e) A Uniform Commercial Code financing statement or statements covering the security interest created by or pursuant to the Granting Clause of the Amended and Restated Indenture that are not covered by the recording system established by the Transportation Code shall have been executed and delivered by Owner Trustee, and such financing statement or statements shall have been duly filed (or will be filed promptly after the Closing) in all places necessary or advisable, and any additional Uniform Commercial Code financing statements deemed advisable by Owner Participant or Pass Through Trustee shall have been executed and delivered by Lessee (if necessary) or Owner Trustee and duly filed (or will be filed promptly after the Closing). (f) Each Pass Through Trustee and Owner Participant shall have received the following: (i) a certificate dated the Delivery Date of the Secretary or an Assistant Secretary of Lessee, certifying as to (A) a copy of the resolutions of the Board of Directors of Lessee or the executive committee thereof duly authorizing the transactions contemplated hereby and the execution, delivery and performance by Lessee of this Agreement and the Lease and each other document required to be executed and delivered by Lessee in accordance with the provisions hereof or thereof and (B) a copy of the certificate of incorporation and by-laws of Lessee, as in effect on the Delivery Date; (ii) a certificate or other evidence from the Secretary of State of the State of Delaware, dated as of a date reasonably near the Delivery Date, as to the due incorporation and good standing of Lessee in such state; (iii) an incumbency certificate of Lessee as to the person or persons authorized to execute and deliver this Agreement, the Lease and each other document to be executed by Lessee in connection with the transactions contemplated hereby and thereby, and the specimen signatures of such person or persons; (iv) one or more certificates of Loan Trustee and Subordination Agent certifying to the reasonable satisfaction of Pass Through Trustee, Owner Participant and Lessee as to the due authorization, execution, delivery and performance by Loan Trustee and Subordination Agent of each of the Operative Documents to which Loan Trustee or Subordination Agent is or will be a party and any other documents to be executed by or on behalf of Loan Trustee or Subordination Agent in connection with the transactions contemplated hereby or thereby (including the incumbency of the person or persons authorized to execute such documentation) and as to the articles of association and by-laws of Loan Trustee and Subordination Agent; (v) one or more certificates of Owner Trustee certifying to the reasonable satisfaction of Pass Through Trustee, Owner Participant and Lessee as to the due authorization, execution, delivery and performance by Owner Trustee of each of the Operative Documents to which Owner Trustee is or will be a party and any other documents to be executed by or on behalf of Owner Trustee in connection with the transactions contemplated hereby or thereby (including the incumbency of the person or persons authorized to execute such documentation) and as to the articles of association and by-laws of Owner Trustee; and (vi) one or more certificates of Owner Participant certifying to the reasonable satisfaction of Pass Through Trustee and Lessee as to the due authorization, execution, delivery and performance by Owner Participant of each of the Operative Documents to which Owner Participant is or will be a party and any other documents to be executed by or on behalf of Owner Participant in connection with the transactions contemplated hereby or thereby (including the incumbency of the person or persons authorized to execute such documentation) and as to the articles of association and by-laws of Owner Participant. (g) On the Delivery Date, the following statements shall be correct: (i) the representations and warranties of Lessee herein are correct in all material respects as though made on and as of such date (other than those contained in Section 4.01(c)(v) and except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties are correct on and as of such earlier date), (ii) no event has occurred and is continuing that constitutes an Event of Default or an Event of Loss or would constitute an Event of Default or Event of Loss but for the requirement that notice be given or time elapse or both and (iii)(A) the Aircraft possesses an appropriate FAA type certificate and a current certificate of airworthiness, (B) the FAA Bill of Sale, the Lease, the Lease Supplement, the Amended and Restated Indenture and the Indenture Supplement covering the Aircraft shall have been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code, and the Trust Agreement shall have been filed (or shall be in the process of being so filed) with the FAA, and (C) application for registration of the Aircraft in the name of Owner Trustee has been duly made with the FAA (or shall be in the process of being so made). (h) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received (i) an opinion addressed to it from internal counsel to Lessee substantially in the form set forth in Exhibit A-1 and (ii) opinions addressed to it from Cadwalader, Wickersham & Taft substantially in the forms set forth in Exhibits A-2 and A-3. (i) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for State Street, Loan Trustee and Subordination Agent, substantially in the form set forth in Exhibit B. (j) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received an opinion addressed to it from Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma, substantially in the form set forth in Exhibit C. (k) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received an opinion addressed to it from Ray, Quinney and Nebeker, special counsel for Owner Trustee, substantially in the form set forth in Exhibit D. (l) Each Pass Through Trustee and Loan Trustee shall have received (i) an opinion addressed to it from [____________], special counsel for Owner Participant, substantially in the form set forth in Exhibit E-1 and (ii) an opinion addressed to it from in-house counsel for Owner Participant, substantially in the form set forth in Exhibit E-2. (m) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received an opinion addressed to it from counsel to Manufacturer, substantially in the form set forth in Exhibit F. (n) Owner Participant shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for Pass Through Trustee, substantially in the form of Exhibit G. (o) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received a certificate or certificates signed by any Senior Vice President, the Treasurer, any Vice President or any Assistant Treasurer (or any other Responsible Officer) of Lessee, dated the Delivery Date, certifying as to the correctness of each of the matters stated in Section 3.01(g). (p) Each Pass Through Trustee and Owner Participant shall have received a certificate from State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, dated the Delivery Date, signed by an authorized officer of State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, certifying for each such entity that no Loan Trustee Liens or Other Party Liens attributable to it, as applicable, exist, and further certifying that the representations and warranties contained herein of State Street, in its individual capacity and as Loan Trustee and as Subordination Agent, as applicable, are correct as though made on and as of the Delivery Date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties are correct as of such earlier date). (q) Each Pass Through Trustee, Owner Participant and Loan Trustee shall have received a certificate from Owner Trustee (in its individual capacity and as trustee), dated the Delivery Date, signed by an authorized officer of Owner Trustee in its individual capacity and as Owner Trustee, as applicable, certifying that the representations and warranties contained herein of Owner Trustee (in its individual capacity and as trustee) are correct as though made on and as of the Delivery Date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties are correct on and as of such earlier date). (r) Each Pass Through Trustee and Loan Trustee shall have received a certificate from Owner Participant, dated the Delivery Date, signed by an authorized officer of Owner Participant, certifying that the representations and warranties of Owner Participant contained herein are correct as though made on and as of the Delivery Date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties are correct on and as of such earlier date). (s) Each Pass Through Trustee, Loan Trustee, and Owner Participant shall have received an insurance report of an independent insurance broker and the related certificates of insurance, each in form and substance reasonably satisfactory to Loan Trustee and Owner Participant, as to the compliance with the terms of Section 11 of the Lease. (t) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (u) Lessor's Cost for the Aircraft shall be $[__________]. (v) Owner Participant shall have received an appraisal from [_____], independent aircraft appraisers, satisfactory in form and substance to Owner Participant, addressing such matters with respect to the Aircraft and the Lease as Owner Participant requests. (w) In the opinion of Owner Participant and its special tax counsel, there shall have been, since the date hereof, no amendment, modification, addition or change in or to the provisions of the Internal Revenue Code of 1986, as amended through the date hereof, and the regulations promulgated under the Code (including temporary regulations), Internal Revenue Service Revenue Procedures or Revenue Rulings, or other administrative interpretations, applicable judicial precedents or Executive Orders of the President of the United States, all as in effect on the date hereof, the effect of which might preclude Owner Participant from obtaining any of the income tax benefits and consequences assumed to be available to Owner Participant as set forth in Section 2 of the Tax Indemnity Agreement. (x) Owner Participant shall have received from [__________________], special tax counsel to Owner Participant, an opinion, in form and substance satisfactory to Owner Participant, with respect to certain Federal income tax aspects of the transaction contemplated by the Operative Documents. (y) Subordination Agent (on behalf of Pass Through Trustee for each of the Pass Through Trusts) shall have delivered the Original Equipment Notes to Loan Trustee for cancellation, and the Original Equipment Notes shall have been canceled by Loan Trustee. (z) Each Pass Through Trustee and Loan Trustee shall have received an opinion addressed to it from Cadwalader, Wickersham & Taft, substantially in the form set forth in Exhibit H. (aa) Each Pass Through Trustee and Loan Trustee shall have received a certificate from Lessee, dated the Delivery Date, signed by an authorized officer of Lessee, certifying as to matters relating to Section 7.11 of the Original Participation Agreement. (bb) Babcock & Brown LP and certain parties to this Agreement shall have entered into a designation agreement within the meaning of Temporary Regulation Section 301.6111-1T in form and substance satisfactory to Owner Participant and Lessee pursuant to which Babcock & Brown LP agrees to act as "designated organizer" and timely and accurately file IRS Form 8264 and required information with the Internal Revenue Service with respect to the Overall Transaction and otherwise satisfy all of the obligations of a designated organizer as provided in Temporary Regulation Sections 301.6111-1T and 301.6111-2T. Promptly upon the registration of the Aircraft and the recording of the Amended and Restated Indenture, the Lease, the Lease Supplement and the Indenture Supplement pursuant to the Transportation Code, Lessee will cause Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma to deliver to Loan Trustee, Owner Participant, Owner Trustee, Lessee and, on behalf of Pass Through Trustees, Subordination Agent an opinion as to the due and valid registration of the Aircraft in the name of Owner Trustee, the due recording of the FAA Bill of Sale, the Amended and Restated Indenture, the Lease, such Lease Supplement and such Indenture Supplement and the filing of the Trust Agreement and the lack of filing of any intervening documents with respect to the Aircraft. Section 3.02 Conditions Precedent to Obligations of Lessee. The obligation of Lessee to sell the Aircraft to Owner Trustee and to accept delivery of the Aircraft under the Lease and the obligations of Lessee to enter into the Operative Documents are all subject to the fulfillment (or waiver by Lessee) prior to or on the Delivery Date of the following conditions precedent: (a) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Lessee to enter into any transaction contemplated by the Operative Documents. (b) The documents referred to in Section 3.01(d) shall have been duly authorized, executed and delivered by the respective party or parties thereto (other than Lessee), shall be in full force and effect and executed counterparts (or copies thereof where indicated) thereof shall have been delivered to Lessee, Lessee shall have received each certificate referred to in Subsections 3.01(f)(iv), (v) and (vi) and 3.01(p), (q) and (r), in each case certified to Lessee, and Lessee shall have received such other documents and evidence with respect to State Street, Loan Trustee, Subordination Agent, Owner Trustee, Owner Participant and each Pass Through Trustee as Lessee reasonably requests in order to establish the consummation of the transactions contemplated by this Agreement, the taking of all corporate and other proceedings in connection therewith and compliance with the conditions herein set forth. (c) The FAA Bill of Sale, the Lease, the Lease Supplement covering the Aircraft, the Amended and Restated Indenture and the Indenture Supplement covering the Aircraft shall have been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code and the Trust Agreement shall have been filed (or shall be in the process of being filed) with the FAA. (d) Lessee shall have received each opinion referred to in Subsections 3.01(i), 3.01(j), 3.01(k), 3.01(l), 3.01(m) and 3.01(n), each such opinion addressed to Lessee. (e) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (f) Lessee shall have been paid Lessor's Cost for the Aircraft. (g) Subordination Agent (on behalf of Pass Through Trustee for each of the Pass Through Trusts) shall have delivered the Original Equipment Notes to Loan Trustee for cancellation, and the Original Equipment Notes shall have been canceled by Loan Trustee. (h) In the opinion of Lessee and its special counsel, there shall have been, since the date hereof, no amendment, modification, addition or change in or to the Internal Revenue Code of 1986, as amended through the date hereof, the regulations promulgated under the Code (including temporary regulations), Internal Revenue Service Revenue Procedures or Revenue Rulings, or other administrative interpretations, applicable judicial precedents or Executive Orders of the President of the United States, which might give rise to an indemnity obligation of Lessee under any of the Operative Documents. (i) Babcock & Brown LP and certain parties to this Agreement shall have entered into a designation agreement within the meaning of Temporary Regulation Section 301.6111-1T in form and substance satisfactory to Owner Participant and Lessee pursuant to which Babcock & Brown LP agrees to act as "designated organizer" and timely and accurately file IRS Form 8264 and required information with the Internal Revenue Service with respect to the Overall Transaction and otherwise satisfy all of the obligations of a designated organizer as provided in Temporary Regulation Sections 301.6111-1T and 301.6111-2T. ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF LESSEE Section 4.01 Representations and Warranties of Lessee. Lessee represents and warrants to each other party hereto that as of the Delivery Date: (a) Lessee is a corporation duly incorporated and validly existing in good standing under the laws of the State of Delaware, is a Certificated Air Carrier, is a Citizen of the United States, has the corporate power and authority to own its properties or hold them under lease and to enter into and perform its obligations under the Operative Documents to which it is a party and is duly qualified to do business as a foreign corporation in good standing in each other jurisdiction in which the failure to so qualify would have a material adverse effect on the consolidated financial condition of Lessee and its subsidiaries, considered as a whole, and its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Delaware) is Delaware. (b) The execution, delivery and performance by Lessee of this Agreement and the other Operative Documents to which Lessee is a party have been duly authorized by all necessary corporate action on the part of Lessee, do not require any stockholder approval or approval or consent of any trustee or holder of any indebtedness or obligations of Lessee, except such as have been duly obtained and are in full force and effect, and do not contravene any law, governmental rule, regulation, judgment or order binding on Lessee or the certificate of incorporation or by-laws of Lessee or contravene or result in a breach of, or constitute a default under, or result in the creation of any Lien (other than Permitted Liens) upon the property of Lessee under, any material indenture, mortgage, contract or other agreement to which Lessee is a party or by which it or any of its properties may be bound or affected. (c) Neither the execution and delivery by Lessee of this Agreement and the other Operative Documents to which it is a party, nor the consummation by Lessee of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with or the taking of any other action in respect of, the Department of Transportation, the FAA or any other federal or state governmental authority or agency, except for (i) the registration of the Pass Through Certificates under the Securities Act of 1933, as amended, and under the securities laws of any state in which the Pass Through Certificates may be offered for sale if the laws of such state require such action, (ii) the qualification of the Pass Through Trust Agreements under the Trust Indenture Act of 1939, as amended, (iii) the orders, permits, waivers, exemptions, authorizations and approvals of the regulatory authorities having jurisdiction over Lessee's operation of the Aircraft required to be obtained on or prior to the Delivery Date, which orders, permits, waivers, exemptions, authorizations and approvals have been duly obtained and are, or on the Delivery Date will be, in full force and effect, (iv) the filings referred to in Section 4.01(e) and (v) consents, approvals, notices, registrations and other actions required to be obtained, given, made or taken only after the date hereof. (d) This Agreement and each other Operative Document to which Lessee is a party have been duly executed and delivered by Lessee and constitute the legal, valid and binding obligations of Lessee enforceable against Lessee in accordance with their terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity and except, in the case of the Lease, as limited by applicable laws that may affect the remedies provided in the Lease. (e) Except for (i)(A) the filing for recordation pursuant to the Transportation Code of the Original Indenture, (B) the filing of the Trust Agreement with the FAA, (C) the registration of the Aircraft pursuant to the Transportation Code and (D) the filing for recording pursuant to the Transportation Code of the FAA Bill of Sale, the Amended and Restated Indenture (with the Indenture Supplement covering the Aircraft attached) and the Lease (with the Lease Supplement covering the Aircraft, the Amended and Restated Indenture and the Indenture Supplement covering the Aircraft attached), (ii) with respect to the security interests created by such documents, the filing of financing statements (and continuation statements at periodic intervals) under the Uniform Commercial Code of Delaware and Utah and the filing of UCC-3 termination statements relating to the financing statements filed in connection with the Original Indenture and (iii) the taking of possession by Loan Trustee of the original chattel paper counterpart of the Lease and the Lease Supplement covering the Aircraft, no further filing or recording of any document is necessary under the laws of the United States or any state thereof as of the Delivery Date in order to establish and perfect Owner Trustee's interest in the Aircraft as against Lessee and any third parties, or to establish and perfect the security interest created under the Amended and Restated Indenture in favor of Loan Trustee in Owner Trustee's interest in the Aircraft and in the Lease in any applicable jurisdiction in the United States. (f) Lessee is not an investment company or a company controlled by an investment company within the meaning of the Investment Company Act of 1940, as amended. (g) Neither Lessee nor any if its Affiliates has directly or indirectly offered the Pass Through Certificates or the Equipment Notes or any similar securities for sale to any Person other than in a manner permitted by the Securities Act of 1933, as amended, and the rules and regulations thereunder. (h) Lessee is solvent and will not be rendered insolvent by the sale of the Aircraft; after the sale of the Aircraft, the capital of Lessee will not be unreasonably small for the conduct of the business in which Lessee is engaged or is about to engage; Lessee has no intention or belief that it is about to incur debts beyond its ability to pay as they mature; and Lessee's sale of the Aircraft is made without any intent to hinder, delay or defraud Lessee's present or future creditors. (i) None of the proceeds from the issuance of the Equipment Notes or from the acquisition by Owner Participant of its beneficial interest in the Trust Estate will be used directly or indirectly by Lessee to purchase or carry any "margin security" as such term is defined in Regulation U of the Board of Governors of the Federal Reserve System. (j) Owner Trustee will receive good and transferable title to the Aircraft from Lessee free and clear of all Liens, except the rights of Lessee under the Lease and the Lease Supplement, the Lien of the Indenture, the beneficial interest of Owner Participant and the Liens permitted by clause (v) of Section 6 of the Lease. (k) On the Delivery Date, all sales or use tax then due and for which Lessee is responsible pursuant to Section 4.02 shall have been paid, other than such taxes which are being contested by Lessee in good faith and by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Aircraft. Section 4.02 General Tax Indemnity. (a) General. Subject to Subsection 4.02(b), Lessee shall pay, and shall indemnify and hold harmless on an After-Tax Basis each Tax Indemnitee from and against, any and all Taxes, however imposed, whether levied or imposed upon such Tax Indemnitee, Lessee, or the Aircraft, an Engine, or any Part thereof or interest therein, by any federal, state or local taxing authority within the United States or any territory or possession thereof, or by any foreign or international taxing authority ("Taxing Authority") relating to: (A) the Aircraft, Airframe, or any Engine or Part, or any interest therein, (B) the acquisition, manufacture, purchase, mortgaging, initial financing, refinancing at Lessee's request, ownership, delivery, nondelivery, redelivery, transport, location, lease, sublease, hire, assignment, alteration, improvement, possession, registration, deregistration, transfer of registration, presence, use, replacement, substitution, pooling, operation, insurance, installation, modification, rebuilding, overhaul, condition, storage, maintenance, repair, sale, return, abandonment, preparation, transfer of title, acceptance, importation, exportation, rejection, or disposition of the Aircraft, or any Engine, any Part, or any interest in any of the foregoing; (C) the rentals, receipts, income or earnings arising therefrom; (D) the Equipment Notes or the Pass Through Certificate(s), or the issuance, acquisition, transfer, or assumption thereof by Lessee, or refinancing thereof caused by Lessee, or the payment of any amounts thereon; (E) the execution, delivery, or performance of any of the Operative Documents or any future amendment, supplement, waiver, or consent thereto requested or consented to by Lessee, or any proceeds or payments or amounts payable under any thereof; or (F) otherwise with respect to, or in connection with, the transactions contemplated by the Operative Documents. (b) Exclusions. Notwithstanding the foregoing, the provisions of Section 4.02(a) shall not obligate Lessee to pay or indemnify for any of the following: (i) Any Taxes imposed by the United States or by any state or local Taxing Authority thereof on, based on, or measured by the gross or net income, gross or net receipts, minimum Tax, capital, net worth, branch profits, franchise, excess profits, value added, ad valorem, or conduct of business of any Tax Indemnitee in each case however denominated (other than any such Taxes which are in the nature of a sales, use, license, or property Tax) ("Income Taxes"); (ii) Any Income Tax imposed on any Tax Indemnitee by any foreign or international Taxing Authority or by any territory or possession of the United States except to the extent such Tax Indemnitee would have been subject to such Income Tax if the sole connection between such Tax Indemnitee and the Taxing Authority had been the operation, location, presence or use of the Aircraft, or the activities of Lessee or any sublessee, within the Taxing Authority; (iii) Taxes imposed with respect to any period after the earlier of (x) the return of possession of the Aircraft to Owner Trustee or its designee pursuant to the terms of the Lease and (y) the termination of the Lease in accordance with Section 9 or Section 19 thereof; (iv) Any capital gains Taxes, excess profits Taxes, value added Taxes, minimum and/or alternative minimum Taxes, accumulated earnings Taxes, personal holding company Taxes, succession Taxes and estate or other similar Taxes; (v) Taxes imposed as a result of any Tax Indemnitee's transfer or other disposition of all or a portion of its interest in the Aircraft or any part thereof, the Trust Estate, the Indenture Estate, any Equipment Note, or the Lease (including, without limitation, a transfer or disposition resulting from the bankruptcy or other proceedings for the relief of debtors in which the transferor is the Debtor), unless, in each case, such transfer or disposition occurs pursuant to the termination of the Lease pursuant to Section 9, 10, or 19 or such transfer or disposition is pursuant to exercise of remedies pursuant to Section 15 of the Lease; (vi) In the case of Owner Trustee, Pass Through Trustees and Loan Trustee, Taxes on, with respect to, or measured by any fees received by any such Trustee for services rendered in connection with any transaction contemplated by the Operative Documents or the Pass Through Agreements; (vii) Taxes to the extent resulting from the inaccuracy or breach of any representation, warranty, covenant or agreement by any Tax Indemnitee or any of its Affiliates under the Operative Documents or the negligence or willful misconduct of any Tax Indemnitee or any of its affiliates; (viii)In the case of Owner Trustee and Owner Participant, Taxes subject to indemnification by Lessee pursuant to the Tax Indemnity Agreement; (ix) Any Taxes included in Lessor's Cost or Taxes that have been paid by Lessee or Owner Trustee as "Transaction Expenses;" (x) Any Tax to the extent that such Tax would not have been imposed but for the failure of the Tax Indemnitee to comply with any certification, documentation, or similar requirements concerning the nationality, residence, or identity of such Tax Indemnitee which, if properly complied with, would have resulted in an exemption from, or a reduced rate of, such Tax or any penalty for which such Tax Indemnitee was otherwise eligible; (xi) In the case of Owner Trustee or Owner Participant, Taxes that would have not been imposed but for a Lessor's Lien; (xii) Taxes to the extent that such Tax would not have been imposed on the Tax Indemnitee but for a present or future connection between such Tax Indemnitee (or any of its Affiliates) and the Taxing Authority, other than a connection arising solely by reason of the transactions contemplated by the Operative Documents; (xiii)In the case of Owner Participant and Owner Trustee, Taxes that would not have been imposed but for the existence or status of any trust used to hold title to the Aircraft; (xiv) Taxes imposed in respect of a "prohibited transaction" within the meaning of ERISA arising out of a breach by any Tax Indemnitee of its representations, warranties or covenants; (xv) Taxes imposed on any transferee of the interests held by a Tax Indemnitee (a) if such Tax would not have been imposed on the original Tax Indemnitee, or (b) to the extent such Tax exceeds the amount of Tax that would have been imposed on the original Tax Indemnitee; (xvi) Taxes during the period while being contested pursuant to the provisions of Subsection 4.02(c); and (xvii)Any Taxes imposed on a Tax Indemnitee related to the status of such Tax Indemnitee or any of its affiliates being a manufacturer of the Airframe, any Engine or Part. (c) Contests. If any claim is made against any Tax Indemnitee or if any proceeding is commenced against any Tax Indemnitee for any Taxes as to which Lessee may have an indemnity obligation pursuant to Subsection 4.02(a), such Tax Indemnitee shall notify Lessee of such claim immediately and, in any case, within 30 days after such Tax Indemnitee receives notice of such claim or proceeding; provided, that failure to provide such notice to Lessee shall not affect the obligation of Lessee to provide indemnification hereunder with respect to the Taxes that are the subject of such claim or proceeding unless and except to the extent that (i) such failure (whether by adversely affecting a counterclaim or defense, or otherwise) materially adversely affects the rights or ability of Lessee to exercise its contest rights, or (ii) such failure results in the imposition of, or an increase in the amount of, any penalties, interest, or additions to Tax related to the Tax which is the subject of such claim or proceeding. At Lessee's request Lessee shall be entitled at no cost or expense to any Tax Indemnitee (A) in the case of a contest involving only Taxes indemnified hereunder ("Indemnified Taxes") or (B) in any proceeding involving a claim for one or more Indemnified Taxes as well as a claim for other Taxes, where the contest of the claim for Indemnified Taxes can be severed from the contest of other Taxes, to assume responsibility for and control of the contest ("Lessee Controlled Contest"). Unless otherwise required by law, any such contest shall be conducted by and in the name of Lessee. If a claim for Indemnified Taxes cannot be contested in a Lessee Controlled Contest, upon Lessee's timely written request, the Tax Indemnitee shall, in good faith, with due diligence, and at Lessee's expense, contest the validity, applicability, or amount of such Taxes ("Tax Indemnitee Controlled Contest"). In such Tax Indemnitee's discretion after consultation with Lessee such contest may be conducted by (A) resisting payment thereof, (B) not paying the same except under protest, if protest is necessary and proper, or (C) if payment is made, using reasonable efforts to obtain promptly a refund thereof in appropriate administrative and judicial proceedings. The Tax Indemnitee shall not be required to take or continue any action pursuant to this paragraph unless and until (1) Lessee agrees to pay and shall timely pay on demand to such Tax Indemnitee all reasonable costs and expenses that such Tax Indemnitee actually incurs in connection with and reasonably allocable to contesting such claim (including reasonable legal and accounting fees, penalties, interest, and addition to tax); (2) if a Payment Default has occurred and is continuing, Lessee provides security for its obligations under this Subsection 4.02(c) reasonably satisfactory to such Tax Indemnitee; (3) if the Tax Indemnitee decides after consultation with Lessee to pay the Tax prior to the contest, Lessee shall provide to the Tax Indemnitee an interest-free advance in an amount equal to the Tax which the Tax Indemnitee determines to pay and shall, in such case, pay any additional amount required to hold such Tax Indemnitee harmless against any adverse Tax consequences arising from such advance (and if such contest is finally determined adversely, the amount of such advance shall be applied against Lessee's obligation to indemnify the Tax Indemnitee against the Indemnified Tax which is the subject of such contest; and (4) the action to be taken will not involve any risk of criminal liability on the Tax Indemnitee or a material risk of a sale, forfeiture, or loss of, or the creation of any Lien on, the Aircraft other than Permitted Liens unless (other than in the case of a risk of criminal liability) Lessee posts a bond or other security reasonably satisfactory to the Tax Indemnitee in respect of such risk. If Lessee satisfies the applicable conditions imposed on it in this Subsection 4.02(c) and a Tax Indemnitee nevertheless fails to contest or refuses to permit Lessee to contest (or itself contest) under or as or to the extent required by this Subsection 4.02(c), then Lessee shall not be obligated to indemnify such Tax Indemnitee for such claim or for any other claim to the extent that such failure to contest or to permit a contest materially adversely affects the contest of such other claim or results in the imposition of, or an increase in the amount of, any penalties, interest, or additions to Tax related to the Tax which is the subject of such claim or proceeding. In addition, subject to the terms of the preceding paragraph, the Tax Indemnitee shall not settle, concede, or compromise any contest without Lessee's prior written consent unless there is no liability against Lessee and the Tax Indemnitee forgoes its right to be indemnified for such claim, and any such settlement, concession, or compromise without the prior written consent of Lessee shall constitute a waiver of such Tax Indemnitee's rights to indemnification hereunder with respect to such claim and any other related claim for which a successful contest is adversely affected in any material respect because of such settlement, concession, or compromise. If the proposed settlement of a claim is acceptable to the Tax Indemnitee but is unacceptable to Lessee, Lessee shall inform such Tax Indemnitee of the amount for which Lessee would be willing to settle such claim. Such Tax Indemnitee may then accept the settlement proposal; provided, that the aggregate amount of Lessee's liability on account of such claim (including any amount previously provided or paid by Lessee) under this Subsection 4.02(c) in respect of such claim does not exceed the amount for which Lessee would have been willing to settle such claim. Such Tax Indemnitee shall promptly return to Lessee such portion of any amounts, previously advanced by Lessee for the payment of the Taxes which were the subject of the contest, as exceeds the amount to which Lessee was willing to settle such claim. If Lessee notifies such Tax Indemnitee that the settlement proposal is unacceptable to Lessee, the Tax Indemnitee shall treat such notification as Lessee's request that such Tax Indemnitee continues to contest such claim for Taxes, in which case Lessee's and such Tax Indemnitee's rights and obligations with respect to such Taxes shall be as provided in this Subsection 4.02(c) without regard to the settlement proposal. A Tax Indemnitee will not be required to appeal any adverse decision to the United States Supreme Court or any corresponding court in a jurisdiction outside the United States. If any Tax Indemnitee actually obtains a refund (or would have actually received such a refund but for offset by matters not indemnifiable by Lessee under Section 4.02) of all or any part of any Tax paid or reimbursed by Lessee, such Tax Indemnitee shall promptly pay to Lessee the amount equal to the lesser of (x) the amount of such refund (or the amount of such offset) plus any interest thereon received from the relevant Taxing Authority (or which would have been received with respect to the amount of such an offset) plus the amount of any Tax benefits realized by such Tax Indemnitee as a result of such payment (and net of any net Tax detriment resulting from the receipt of the refund and interest on the refund (after giving effect to such Tax Indemnitee's obligations to make payments to Lessee under this sentence)), and (y) the sum of (i) such Tax payment by Lessee to such Tax Indemnitee plus (ii) any interest received by such Tax Indemnitee with respect to such refund or offset plus (iii) any other payment (other than expenses of the contest) by Lessee to such Tax Indemnitee already made (and not already repaid to Lessee) pursuant to this Section 4.02, it being intended that such Tax Indemnitee shall be entitled to a net tax benefit pursuant to this Section 4.02 only if Lessee has been reimbursed for any payments made by it to such Tax Indemnitee pursuant to this Section 4.02. Such amount shall not be payable before Lessee has made all payments or indemnities then due and owing to such Tax Indemnitee by Lessee pursuant to the Operative Documents, or while any Payment Default shall have occurred and is continuing. Any subsequent loss or disallowance of such refund (as a result of a redetermination of the claim giving rise to such refund by any Taxing Authority or as a result of a judicial proceeding with respect to such claim) or Tax benefit shall be treated as a Tax subject to indemnification under this Section 4.02. If a Tax Indemnitee receives an award of attorneys' fees in a contest for which Lessee has paid an allocable portion of the contest expenses, such Tax Indemnitee shall pay to Lessee that portion of the award that is directly related to the issues contested with respect to an Indemnified Tax, taking into account the rules applicable to obtaining such an award and any decision of the court in making such award up to the amount of attorneys' fees paid or borne by Lessee in connection with such contest. No Tax Indemnitee is required to contest or permit the contest of a claim pursuant to this Section 4.02 if such Tax Indemnitee waives payment by Lessee of (x) any amount that might otherwise be payable by Lessee under this Section 4.02 by way of indemnity in respect of such claim, and (y) any other amount that might otherwise be payable by Lessee by way of indemnification in respect of any other claim for which a successful contest is adversely affected in any material respect because of such failure to contest. In such event, such Indemnitee shall reimburse Lessee for all indemnity amounts paid by or on behalf of Lessee with respect to such non-contested claim. (d) Payments and Repayments. All Taxes shall be paid when due and payable to the appropriate Taxing Authority, and all amounts payable as indemnities pursuant to this Section 4.02 shall be payable, to the extent not theretofore paid, on written demand by the appropriate Tax Indemnitee, except that Taxes being contested pursuant to Subsection 4.02(c) shall not be required to be paid, other than under clause (3) in the second paragraph of Subsection 4.02(c), before such contest is finally resolved. If, for any reason, Lessee makes any payment with respect to any Taxes imposed on any Tax Indemnitee in respect of the transactions contemplated by the Operative Documents or on the Aircraft, which Taxes are not the responsibility of Lessee with respect to such Tax Indemnitee under this Section 4.02, then such Tax Indemnitee shall pay to Lessee within 30 days of Lessee's demand therefor an amount that equals the amount paid by Lessee with respect to such Taxes, plus interest at the Debt Rate for the Series G-1 Equipment Notes from the date paid by Lessee to the date repaid to Lessee by such Tax Indemnitee. (e) Reports and Returns. If any report or return is required to be made with respect to any Indemnified Tax, Lessee shall in a timely and proper fashion, (x) to the extent required or permitted by law, make and file such return or report in its own name and (y) in the case of any such return or report required to be made in the name of any Tax Indemnitee, inform such Tax Indemnitee of such fact and prepare such return or report for filing by such Tax Indemnitee or, where such return or report is required to reflect items in addition to any obligations of Lessee under or arising out of this Section 4.02, provide such Tax Indemnitee with information sufficient to permit such return or report to be properly made and timely filed no later than 30 days prior to the due date for filing such return or report. Each Tax Indemnitee shall provide to Lessee such information within that Tax Indemnitee's possession or control as is reasonably necessary for Lessee properly to complete and file any such report or return. (f) Receipts and Records. Lessee shall use reasonable efforts to obtain official receipts indicating the payment of all Indemnified Taxes that are paid by Lessee, and shall promptly on request send to the appropriate Tax Indemnitee each such receipt obtained by Lessee. Within a reasonable time after Lessee receives from a Tax Indemnitee a written request for specified information or copies of specified records maintained in the regular course of Lessee's business reasonably necessary to enable a Tax Indemnitee to fulfill its Tax filing, Tax audit or other Tax obligations or to contest Taxes imposed upon it, Lessee shall provide such information or copies of such records to such Tax Indemnitee. (g) Lessee a Primary Obligor. Lessee's obligations under the indemnities provided for in this Section 4.02 are those of a primary obligor whether or not the Tax Indemnitee is also indemnified against the same matter under any other Operative Document or any other document or instrument, and the Tax Indemnitee may proceed directly against Lessee without first seeking to enforce any other right of indemnification. All indemnities payable by Lessee pursuant to this Section 4.02 shall be treated as obligations of Lessee under the Lease and each amount thereof shall constitute Supplemental Rent under the Lease. (h) Payments on After-Tax Basis, Tax Savings. Each payment and indemnity by Lessee under this Section 4.02 shall be made on an After-Tax Basis. If any Tax Indemnitee realizes any credits, deductions, or other tax benefits (or would have realized such a benefit if properly claimed) by reason of such payment or indemnity or, to the extent not otherwise taken into account in the computation of such payment or indemnity, as a result of the imposition or payment of any Tax with respect to which an indemnity has been paid hereunder, such Indemnitee shall pay to Lessee an amount equal to the lesser of (1) the sum of the amount by which such credits, deductions, and other tax benefits reduce such Indemnitee's Taxes plus any tax benefit realized as the result of any payment made pursuant to this sentence, and (2) the amount of such payment by Lessee to or for the account of such Tax Indemnitee plus the amount of any other payments other than expenses of the contest by Lessee to or for the account of such Tax Indemnitee theretofore made (and not get repaid to Lessee pursuant to this Subsection 4.02(h), with the excess of (1) over (2), if any, being carried forward and applied to reduce pro tanto any subsequent obligations of Lessee to make payments to such Tax Indemnitee pursuant to this Subsection 4.02, it being intended that no Tax Indemnitee should be entitled to a net tax benefit pursuant to this Subsection 4.02(h) unless Lessee shall concurrently be made whole for any payments made by it to such Tax Indemnitee pursuant to Section 4.02). Any Taxes that are imposed on any Tax Indemnitee as a result of the disallowance or reduction in a subsequent tax year of a tax benefit referred to in the first sentence of this Subsection 4.02(h) shall be indemnifiable pursuant to this Section 4.02. In determining the order in which any Tax Indemnitee utilizes withholding or foreign taxes as a credit against such Tax Indemnitee's United States income taxes, such Tax Indemnitee shall be deemed to utilize (i) first, all foreign taxes other than those described in clause (ii) below; provided that such foreign taxes which are carried back to the taxable year for which a determination is being made shall be deemed utilized after foreign taxes described in clause (ii) below, and (ii) then, on a pro rata basis, all foreign taxes with respect to which such Tax Indemnitee is entitled to indemnification pursuant to an indemnification provision contained in any lease, loan agreement, or other financing document (including this Agreement) that is similar to the indemnification provision in this Section 4.02. Each Tax Indemnitee shall in good faith use reasonable efforts in filing its tax returns and in dealing with Taxing Authorities to seek and claim any tax savings which would result in payments to Lessee under this Section 4.02 and to minimize the net amount of any Lessee liability with respect to Indemnified Taxes. (i) Verification. At Lessee's written request after Lessee receives a Tax Indemnitee's computations showing the amount of any indemnity payable by Lessee to such Tax Indemnitee pursuant to this Section 4.02 or any amount payable by any Tax Indemnitee to Lessee pursuant to this Section 4.02, such computations shall be subject to confidential verification in writing by any nationally recognized firm of certified public accountants selected by Lessee and reasonably acceptable to such Tax Indemnitee. The accounting firm shall complete its review within thirty (30) days of Lessee's receipt of such Tax Indemnitee's computations. The computations of such accounting firm shall (i) be delivered simultaneously to Lessee and such Tax Indemnitee and (ii) absent manifest error, be final, binding and conclusive upon Lessee and such Tax Indemnitee. If Lessee pays such indemnity in whole or in part before completion of the verification procedure, appropriate adjustments will be made promptly after completion of the verification procedure (and nothing in this Subsection 4.02(i) shall be construed as changing the time when any such indemnity is payable under this Section 4.02) to take into account any redetermination of the indemnity by the accounting firm. The fee and disbursements of such firm shall be paid by Lessee unless such verification shall disclose an error in favor of such Tax Indemnitee exceeding the lesser of five percent (5%) of the original claim or $10,000, in which case such fee and disbursements shall be paid by such Tax Indemnitee. Such Tax Indemnitee shall cooperate with such accounting firm and (subject to such accounting firm's execution of a confidentiality agreement satisfactory to such Tax Indemnitee) shall supply such accounting firm with all information reasonably necessary to permit such review and determination. The sole responsibility of such accounting firm shall be to verify the computations of amounts payable hereunder and the interpretation of this Agreement shall not be within the scope of such accounting firm's responsibilities. (j) Interest. Lessee will pay as Supplement Rent to each Tax Indemnitee, on demand, to the extent permitted by applicable law, interest at the Past Due Rate on the amount of any indemnity not paid when due pursuant to this Section 4.02, until it is paid. A Tax Indemnitee will pay to Lessee, on demand, to the extent permitted by applicable law, interest at the Past Due Rate on the amounts of any payment or reimbursement required hereunder to be made by such Tax Indemnitee to Lessee not paid when due pursuant to this Section 4.02 until it is paid. (k) Non-Parties. If a Tax Indemnitee is not a party to this Agreement, Lessee may require the Tax Indemnitee to agree to the terms of this Section 4.02 prior to making any payment to such Tax Indemnitee under this Section 4.02. (l) Forms, etc. Each Tax Indemnitee agrees to furnish to Lessee from time to time such duly executed and properly completed forms that may be necessary or appropriate in order to claim any applicable reduction of or exemption from, any withholding tax imposed by any Taxing Authority in respect of any payments otherwise required to be made by Lessee pursuant to the Operative Documents. (m) Indemnification for Withholding Taxes on Payments on Equipment Notes or Pass Through Certificates. Notwithstanding the exclusions set forth in Subsection 4.02(b) hereof, Lessee shall indemnify and hold harmless on an After-Tax Basis Owner Participant or, if applicable, Owner Trustee for any U.S. withholding Taxes (and any interest and penalties with respect thereto) imposed with respect to a Noteholder or the holder of a Pass Through Certificate, as the case may be, that result from the failure of a Pass Through Trustee or Loan Trustee to properly withhold such Taxes. To the extent that Lessee is not otherwise reimbursed for such amounts, Lessee shall be entitled to recover any amounts paid pursuant to the preceding sentence from Pass Through Trustee or Loan Trustee, as the case may be, in its individual capacity (plus interest thereon at the Debt Rate for Series G-1 Equipment Notes until such amounts have been recovered in full by Lessee). In no event, however, shall such payment be made out of, or be indemnifiable from, the assets held by Pass Through Trustee or Loan Trustee on behalf of the holders of the Pass Through Certificates or the Equipment Notes, as the case may be. If Loan Trustee or Pass Through Trustee is required to pay any amount in its individual capacity hereunder, it shall have no recourse to or right of reimbursement from, the Indenture Estate, any Pass Through Trust, the Trust Estate, or any portion of either. Section 4.03 General Indemnity. (a) Claims Defined. For the purposes of this Section 4.03, "Claims" means any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs or expenses of whatsoever kind and nature (whether or not on the basis of negligence, strict or absolute liability or liability in tort) that may be imposed on, incurred by, suffered by or asserted against an Indemnitee, as defined below, and, except as otherwise expressly provided in this Section 4.03, includes all reasonable out-of-pocket costs, disbursements and expenses (including reasonable out-of-pocket legal fees and expenses) actually incurred by an Indemnitee in connection therewith or related thereto. (b) Indemnitee Defined. For the purposes of this Section 4.03, "Indemnitee" means (i) Owner Trustee, in its individual capacity and as trustee under the Trust Agreement, (ii) Owner Participant, (iii) State Street and Loan Trustee, (iv) so long as it holds any Equipment Notes as agent and trustee of any Pass Through Trustee, Subordination Agent, (v) so long as it is the holder of any Equipment Notes, each Pass Through Trustee, (vi) Liquidity Provider and Policy Provider and (vii) each of their respective successors and permitted assigns in such capacities, agents, servants, officers, employees and directors (the respective agents, servants, officers, employees and directors of each of the foregoing Indemnitees, as applicable, together with such Indemnitee, being collectively the "Related Indemnitee Group" of such Indemnitee); provided that such Persons, to the extent they are not signatories to this Agreement, have expressly agreed in writing to be bound by the terms of this Section 4.03 prior to, or concurrently with, the making of a Claim. If any Indemnitee fails to comply with any duty or obligation under this Section 4.03 with respect to any Claim, such Indemnitee shall not be entitled to any indemnity with respect to such Claim under this Section 4.03 to the extent such failure was prejudicial to Lessee. No holder of a Pass Through Certificate in its capacity as such holder shall be an Indemnitee. (c) Claims Indemnified. Subject to the exclusions stated in Subsection 4.03(d), Lessee agrees to indemnify, protect, defend and hold harmless on an After-Tax Basis each Indemnitee against Claims resulting from or arising out of (i) any of the Operative Documents or the Original Documents or the enforcement of any of the terms thereof or any amendment, modification or waiver in respect thereof and, only in the case of an Indemnitee which is Owner Participant or Owner Trustee, the Intercreditor Agreement, the Liquidity Facilities and the Pass Through Trust Agreements or (ii) the Aircraft, the Airframe, or any Engine or any Part, or any interest therein, whether or not arising out of the sale, purchase, acceptance, non-acceptance or rejection of the Aircraft under the Purchase Agreement or the ownership, possession, use, non-use, substitution, airworthiness, control, maintenance, repair, operation, registration, re-registration, condition, sale, lease, sublease, storage, modification, alteration, return, transfer or other disposition of the Aircraft, the Airframe, any Engine or any Part (including, without limitation, latent or other defects, whether or not discoverable, and any claim for patent, trademark or copyright infringement) by Lessee, any Permitted Sublessee or any other Person. The foregoing indemnity shall not extend to any Claim to the extent that such Claim is not caused by, or does not arise out of, an act, omission or event which occurs prior to the termination of the Lease and the payment of all other payments then due and required to be paid by Lessee under the Operative Documents. Without limiting the foregoing, Lessee agrees to pay the reasonable fees and expenses actually incurred of Loan Trustee and Owner Trustee for acting as such, other than such fees and expenses which constitute Transaction Expenses. (d) Claims Excluded. The following are excluded from Lessee's agreement to indemnify an Indemnitee under this Section 4.03: (i) Except to the extent fairly attributable to acts or events occurring prior thereto, any Claim to the extent such Claim is attributable to acts or events occurring after the earlier of (x) the return of possession of the Aircraft to Owner Trustee or its designee pursuant to the terms of the Lease, or (y) the termination of the Lease in accordance with Section 9 or Section 19 thereof; (ii) any Claim to the extent such Claim is, or is attributable to, a Tax or related to the Tax Indemnity Agreement; (iii) any Claim to the extent such Claim is attributable to the negligence or willful misconduct of such Indemnitee or such Indemnitee's Related Indemnitee Group (other than negligence imputed to such Indemnitee (or such Indemnitee's Related Indenture Group) solely by reason of its interest in the Aircraft); (iv) any Claim to the extent such Claim is attributable to the noncompliance by such Indemnitee or such Indemnitee's Related Indemnitee Group with any of the terms of, or any misrepresentation by an Indemnitee or its Related Indemnitee Group contained in, this Agreement, any other Operative Document, any Original Document or any Pass Through Document to which such Indemnitee or any of such Related Indemnitee Group is a party or any agreement relating hereto or thereto; (v) any Claim to the extent such Claim constitutes a Permitted Lien attributable to such Indemnitee; (vi) any Claim to the extent such Claim is attributable to the offer, sale, assignment, transfer, participation or other disposition (whether voluntary or involuntary) by or on behalf of such Indemnitee or its Related Indemnitee Group (other than, in the case of Owner Trustee, as contemplated by the Lease, and other than during the occurrence and continuance of an Event of Default, provided that any such offer, sale, assignment, transfer, participation or other disposition during the occurrence and continuation of an Event of Default shall not be subject to indemnification unless it is made in accordance with the Operative Documents and applicable law) of any Equipment Note or Pass Through Certificate, all or any part of such Indemnitee's interest in the Operative Documents or the Pass Through Documents or any interest in the Indenture Estate or any similar security; (vii) any Claim to the extent such Claim is attributable to (A) a failure on the part of Loan Trustee to distribute in accordance with this Agreement or the Indenture any amounts received and distributable by it hereunder or thereunder, (B) a failure on the part of Subordination Agent to distribute in accordance with the Intercreditor Agreement any amounts received and distributable by it thereunder, (C) a failure on the part of any Pass Through Trustee to distribute in accordance with the Pass Through Trust Agreement to which it is a party any amounts received and distributable by it thereunder or (D) a failure on the part of Owner Trustee to distribute in accordance with the Trust Agreement any amounts received and distributable by it thereunder; (viii)any Claim to the extent such Claim is attributable to the authorization or giving or withholding of any future amendments, supplements, waivers or consents with respect to any Operative Document or any Pass Through Document, other than such as have been requested by Lessee or that occur as the result of an Event of Default, or such as are expressly required or contemplated by the provisions of the Operative Documents or the Pass Through Documents; (ix) any Claim to the extent such Claim is payable or borne by (a) Lessee pursuant to any indemnification, compensation or reimbursement provision of any other Operative Document or any Pass Through Document or (b) a Person other than Lessee pursuant to any provision of any Operative Document or any Pass Through Document; (x) any Claim to the extent such Claim is an ordinary and usual operating or overhead expense or not an out-of-pocket expense actually incurred; (xi) any Claim to the extent such Claim is incurred on account of or asserted as a result of any "prohibited transaction" within the meaning of Section 406 of ERISA or Section 4975 of the Code; (xii) any Claim to the extent such Claim is attributable to one or more of the other aircraft financed through the offering of Pass Through Certificates (in the event of doubt, any Claim shall be allocated between the Aircraft and such other aircraft in the same proportion that the then outstanding Equipment Notes bear to the then outstanding equipment notes issued with respect to the other aircraft and held by Pass Through Trustees); (xiii)any Claim by an Indemnitee related to the status of such Indemnitee as a passenger or shipper on any of Lessee's aircraft or as a party to a marketing or promotional or other commercial agreement with Lessee; (xiv) any Claim to the extent such Claim is attributable to the offer or sale of any interest in the Trust Estate or the Trust Agreement or any similar interest other than during the occurrence and continuation of an Event of Default; and (xv) any Claim by an Indemnitee related to the status of such Indemnitee or such Indemnitee's Related Indemnitee Group being a manufacturer of the Airframe, any Engine or Part. (e) Insured Claims. In the case of any Claim indemnified by Lessee hereunder that is covered by a policy of insurance maintained by Lessee, each Indemnitee agrees to cooperate, at Lessee's expense, with the insurers in the exercise of their rights to investigate, defend and compromise such Claim. (f) Claims Procedure. An Indemnitee shall promptly notify Lessee of any Claim as to which indemnification is sought. The failure to provide such prompt notice shall not release Lessee from any of its obligations to indemnify hereunder except to the extent that Lessee is prejudiced by such failure or Lessee's indemnification obligations are increased as a result of such failure. Such Indemnitee shall promptly submit to Lessee all additional information in such Indemnitee's possession to substantiate such Claim as Lessee reasonably requests. Subject to the rights of Lessee's insurers, Lessee may, at its sole cost and expense, investigate any Claim, and may in its sole discretion defend or compromise any Claim. At Lessee's expense, any Indemnitee shall cooperate with all reasonable requests of Lessee in connection therewith. Such Indemnitee shall not enter into a settlement or other compromise with respect to any Claim without the prior written consent of Lessee, which consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives its right to be indemnified with respect to such Claim. Where Lessee or its insurers undertake the defense of an Indemnitee with respect to a Claim, no additional legal fees or expenses of such Indemnitee in connection with the defense of such Claim shall be indemnified hereunder unless such fees or expenses were incurred at the written request of Lessee or such insurers. Subject to the requirements of any policy of insurance, an Indemnitee may participate at its own expense in any judicial proceeding controlled by Lessee pursuant to the preceding provisions; provided that such party's participation does not, in the opinion of counsel appointed by Lessee or its insurers to conduct such proceedings, interfere with such control. Such participation shall not constitute a waiver of the indemnification provided in this Section 4.03. Notwithstanding anything to the contrary contained herein, Lessee shall not under any circumstances be liable for the fees and expenses of more than one counsel for all Indemnitees with respect to any one Claim. (g) Subrogation. To the extent that a Claim is in fact paid in full by Lessee or its insurer, Lessee or such insurer (as the case may be) shall, without any further action, be subrogated to the rights and remedies of the Indemnitee on whose behalf such Claim was paid with respect to the transaction or event giving rise to such Claim. Such Indemnitee shall give such further assurances or agreements and shall cooperate with Lessee or such insurer, as the case may be, to permit Lessee or such insurer to pursue such rights and remedies, if any, to the extent reasonably requested by Lessee. So long as no Event of Default has occurred and is continuing, if an Indemnitee receives any payment, in whole or in part, from any party other than Lessee or its insurers with respect to any Claim paid by Lessee or its insurers, it shall promptly pay over to Lessee the amount received (but not an amount in excess of the amount Lessee or any of its insurers has paid in respect of such Claim). Any amount referred to in the preceding sentence that is payable to Lessee shall not be paid to Lessee, or, if it has been previously paid directly to Lessee, shall not be retained by Lessee, if at the time of such payment an Event of Default has occurred and is continuing, but shall be paid to and held by Loan Trustee as security for the obligations of Lessee under the Operative Documents. If Lessee agrees, such amount payable shall be applied against Lessee's obligations thereunder when and as they become due and payable. At such time as such Event of Default is no longer continuing, such amount, to the extent not previously so applied against Lessee's obligations, shall be paid to Lessee. If any such amount has been so held by Loan Trustee as security for more than 90 days after any such Event of Default has occurred, during which period (i) Owner Trustee or Loan Trustee was not limited by operation of law or otherwise from exercising remedies under the Lease and (ii) Owner Trustee or Loan Trustee did not exercise any remedy available to it under Section 15 of the Lease, then any remaining such amount shall be paid to Lessee. (h) No Guaranty. Nothing set forth in this Section 4.03 constitutes a guarantee by Lessee of payments due pursuant to the Equipment Notes or that the Aircraft at any time will have any particular value, useful life or residual value. (i) Payments; Interest. Any amount payable to any Indemnitee on account of a Claim shall be paid within 30 days after receipt by Lessee of a written demand therefor from such Indemnitee accompanied by a written statement describing in reasonable detail the Claims that are the subject of and basis for such indemnity and the computation of the amount payable. Any payments made pursuant to this Section 4.03 directly to an Indemnitee or to Lessee, as the case may be, shall be made in immediately available funds at such bank or to such account as is specified by the payee in written directions to the payor or, if no such directions are given, by check of the payor payable to the order of the payee and mailed to the payee by certified mail, return receipt requested, postage prepaid to its address referred to in Section 16.01. To the extent permitted by applicable law, interest at the Past Due Rate shall be paid, on demand, on any amount or indemnity not paid when due pursuant to this Section 4.03 until the same is paid. Such interest shall be paid in the same manner as the unpaid amount in respect of which such interest is due. (j) Tax deduction or credit. If, by reason of any Claim payment made to or for the account of an Indemnitee by Lessee pursuant to this Section 4.03, such Indemnitee subsequently realizes a tax deduction or credit (including foreign tax credit and any reduction in Taxes) not previously taken into account in computing such payment, such Indemnitee shall promptly pay to Lessee, but only if Lessee has made all payments then due and owing to such Indemnitee under the Operative Documents, an amount equal to the sum of (1) the actual reduction in Taxes realized by such Indemnitee which is attributable to such deduction or credit, and (2) the actual reduction in Taxes realized by such Indemnitee as a result of any payment made by such Indemnitee pursuant to this sentence. ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF OTHER PARTIES Section 5.01 Representations, Warranties and Covenants of State Street. State Street, generally, and each of Loan Trustee, Subordination Agent and Pass Through Trustee as it relates to it, represents, warrants and covenants that: (a) State Street is a national banking association duly organized and validly existing in good standing under the laws of the United States, is eligible to be Loan Trustee under Section 8.01(a) of the Indenture, will promptly comply with Section 8.01(a) of the Indenture and has full power, authority and legal right to enter into and perform its obligations under each of the Operative Documents and the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party and, in its capacity as Loan Trustee and Pass Through Trustee, respectively, to authenticate the Equipment Notes and the Pass Through Certificates, respectively. State Street is qualified to act as Loan Trustee under Section 8.01(c) of the Indenture. (b) The execution, delivery and performance by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, each of the other Operative Documents and each of the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, and the authentication of the Equipment Notes and the Pass Through Certificates, respectively, to be delivered on the Delivery Date, have been duly authorized by all necessary action on the part of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee, as the case may be, and do not violate any law or regulation of the United States or of the state of the United States in which State Street is located and which governs the banking and trust powers of State Street or any order, writ, judgment or decree of any court, arbitrator or governmental authority applicable to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee or any of their assets, will not violate any provision of the articles of association or by-laws of State Street and will not violate any provision of, or constitute a default under, any mortgage, indenture, contract, agreement or undertaking to which any of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party or by which any of them or their respective properties may be bound or affected. (c) Neither the execution and delivery by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, any other Operative Document or any Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, nor the consummation by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with, or the taking of any other action in respect of, any governmental authority or agency of the United States or the state of the United States where State Street is located and regulating the banking and trust powers of State Street. (d) This Agreement, each other Operative Document and each Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party have been duly executed and delivered by State Street, individually and in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, and constitute the legal, valid and binding obligations of State Street, Loan Trustee, Subordination Agent and such Pass Through Trustee, as the case may be, enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. (e) It unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Loan Trustee Lien or Other Party Lien with respect to the Indenture Estate or the Trust Estate attributable to it, and it agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Lien; and it shall indemnify, protect, defend and hold harmless each Indemnitee and Lessee against Claims in any way resulting from or arising out of a breach by it of its obligations under this Section 5.01(e). State Street, in its individual capacity, agrees to make restitution to the Trust Estate for any actual diminution of the assets of the Indenture Estate or the Trust Estate resulting from any such Lien. (f) The Assumed Equipment Notes to be issued to Subordination Agent pursuant hereto are being acquired by it to be held under the Intercreditor Agreement. (g) Each of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee agrees that it will not impose any lifting charge, cable charge, remittance charge or any other charge or fee on any transfer by Lessee of funds to, through or by State Street, Loan Trustee, Subordination Agent or such Pass Through Trustee pursuant to this Agreement, any other Operative Document or any Pass Through Document, except as may be otherwise agreed to in writing by Lessee. (h) Each of State Street, Loan Trustee, Subordination Agent and any Pass Through Trustee agrees to be bound by the terms of Section 10.15 of the Indenture. (i) There are no Taxes payable by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee imposed by the State of Connecticut or any political subdivision or taxing authority thereof in connection with the execution, delivery or performance by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any Operative Document or any Pass Through Document (other than franchise or other taxes based on or measured by any fees or compensation received by any such Person for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents), and there are no Taxes payable by any Pass Through Trustee imposed by the State of Connecticut or any political subdivision thereof in connection with the acquisition, possession or ownership by such Pass Through Trustee of any of the Equipment Notes (other than franchise or other taxes based on or measured by any fees or compensation received by such Pass Through Trustee for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents) and, assuming that the Pass Through Trusts will not be taxable for Federal income tax purposes as corporations, but, rather, will be characterized for such purposes as grantor trusts or partnerships, the Pass Through Trusts will not be subject to any Taxes imposed by the State of Connecticut or any political subdivision thereof. (j) Except with the consent of Lessee, which shall not be unreasonably withheld, State Street will act as Pass Through Trustee solely through its offices within the State of Connecticut, except for such services that may be performed for it by various agents, but not directly by it, in other states. (k) There are no pending or, to its knowledge, threatened actions or proceedings against State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee before any court or administrative agency which individually or in the aggregate, if determined adversely to it, would materially adversely affect the ability of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee to perform its obligations under any Operative Document or any Pass Through Document. (l) The representations and warranties contained in Section 7.15 of each Pass Through Trust Agreement are true, complete and correct as of the Delivery Date. (m) Except for the issue and sale of the Pass Through Certificates, Pass Through Trustee has not directly or indirectly offered any Equipment Notes for sale to any Person or solicited any offer to acquire any Equipment Notes from any Person, nor has Pass Through Trustee authorized anyone to act on its behalf to offer directly or indirectly any Equipment Notes for sale to any Person, or to solicit any offer to acquire any Equipment Notes from any Person; and Pass Through Trustee is not in default under any Pass Through Trust Agreement. (n) Pass Through Trustee is not directly or indirectly controlling, controlled by or under common control with Owner Participant, Owner Trustee, any Underwriter or Lessee. Section 5.02 Representations, Warranties and Covenants of Owner Participant. Owner Participant represents, warrants and covenants that: (a) It is duly incorporated, validly existing and in good standing under the laws of [_______] and has the corporate power and authority to carry on its present business and operations and to own or lease its properties, and has the corporate power and authority to enter into and to perform its obligations under the Operative Documents to which it is a party; this Agreement and the other Operative Documents to which it is a party have been duly authorized, executed and delivered by it; and this Agreement and each of the other Operative Documents to which it is a party constitute the legal, valid and binding obligations of Owner Participant enforceable against it in accordance with its respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity, whether considered in a proceeding at law or in equity. (b) Neither the execution and delivery by Owner Participant of the Operative Documents to which it is a party nor compliance by it with all of the provisions thereof, will contravene (x) any law or order of any court or governmental authority or agency applicable to or binding on Owner Participant (it being understood that no representation or warranty is made with respect to laws, rules or regulations relating to aviation or to the nature of the equipment owned by Owner Trustee other than such laws, rules or regulations relating to the citizenship requirements of Owner Participant under applicable law) or (y) the provisions of, or constitutes or has constituted or will constitute a default under, or result in the creation of any Lien (other than Liens provided for in the Operative Documents) upon any property of Owner Participant under, its certificate of incorporation or by-laws or any indenture, mortgage, contract or other agreement or instrument to which Owner Participant is a party or by which it or any of its property may be bound or affected. (c) No authorization or approval or other action by, and no notice to or filing with any governmental authority or regulatory body (other than as required by the Transportation Code) is required for the due execution, delivery or performance by it of the Operative Documents to which it is a party. (d) There are no pending or, to its knowledge, threatened actions or proceedings before any court or administrative agency or arbitrator which would materially adversely affect Owner Participant's ability to perform its obligations under the Operative Documents to which it is a party. (e) Neither Owner Participant nor anyone authorized by it to act on its behalf (it being understood that in proposing, facilitating and otherwise taking any action in connection with the financing contemplated hereby and agreed to herein by Owner Participant, Lessee has not acted as agent of Owner Participant) has directly or indirectly offered any Equipment Note or Pass Through Certificate or any interest in and to the Trust Estate, the Trust Agreement or any similar interest for sale to, or solicited any offer to acquire any of the same from, any Person. Owner Participant's interest in the Trust Estate and the Trust Agreement is being acquired for its own account and is being purchased for investment and not with a view to any resale or distribution thereof. (f) On the Delivery Date, the Trust Estate will be free of Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to Owner Participant. (g) It is a Citizen of the United States (without making use of a voting trust agreement, voting powers agreement or similar arrangement). (h) It has a tangible net worth (exclusive of goodwill) greater than $50,000,000, as determined in accordance with generally accepted accounting principles. (i) Owner Participant covenants and agrees that if (i) Lessee has elected pursuant to Section 9(a)(2) of the Lease to terminate the Lease by causing the Aircraft to be sold pursuant to Section 9(b) of the Lease and (ii) Owner Trustee has, pursuant to Section 9(b) of the Lease, given to Lessee written notice of Owner Trustee's election to retain title to the Aircraft and (iii) Owner Trustee has failed to make, on or before the Termination Date, any payment required to be made by Owner Trustee pursuant to Section 9(b) of the Lease in connection with its retention of title to the Aircraft, Owner Participant will indemnify Lessee for any losses, damages, costs or expenses of any kind (including any additional rents paid by Lessee and any fees and expenses of lawyers, appraisers, brokers or accountants) incurred as a consequence of such failure by Owner Trustee. Owner Participant further covenants and agrees to pay those costs and expenses specified to be paid by Owner Participant pursuant to Exhibit E to the Lease. (j) Section 3 of the Lease contemplates that, under certain circumstances, Owner Participant will make certain recalculations of Basic Rent percentages and allocations, the Special Purchase Price, Stipulated Loss Value percentages and Termination Value percentages, and Owner Participant hereby agrees to make such recalculations as and when contemplated by the Lease and subject to all the terms and conditions of the Lease and promptly to take such further actions as may be necessary or desirable to give effect to and to cause Owner Trustee to give effect to the provisions of Section 3 of the Lease. Section 5.03 Representations, Warranties and Covenants of Owner Trustee. Owner Trustee, in its individual capacity (except as provided in clauses (c) and (g) below) and (but only as provided in clauses (c) and (g) and, to the extent that it relates to Owner Trustee, clauses (b), (i) and (k) below) as Owner Trustee, represents, warrants and covenants that: (a) Owner Trustee, in its individual capacity, is a national banking association duly organized and validly existing in good standing under the laws of the United States, has full corporate power and authority to carry on its business as now conducted, has the corporate power and authority to execute and deliver the Trust Agreement, has the corporate power and authority to carry out the terms of the Trust Agreement, and has (assuming the authorization, execution and delivery of the Trust Agreement by Owner Participant), as Owner Trustee, and to the extent expressly provided herein or therein, in its individual capacity, the corporate power and authority to execute and deliver and to carry out the terms of this Agreement, the Indenture, the Equipment Notes, the Lease and each other Operative Document to which it is a party. (b) Owner Trustee in its trust capacity and, to the extent expressly provided herein, in its individual capacity, has duly authorized, executed and delivered this Agreement, in its individual capacity, has duly authorized, executed and delivered the Trust Agreement and in its trust capacity, except as expressly provided therein, has duly authorized, executed and delivered the other Operative Documents to which it is a party and (assuming the authorization, execution and delivery of the Trust Agreement by Owner Participant) this Agreement and each of the other Operative Documents to which it is a party constitute the legal, valid and binding obligations of Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, enforceable against it in its individual capacity or as Owner Trustee, as the case may be, in accordance with its terms, except as the same may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and by general principles of equity, whether considered in a proceeding at law or in equity. On the Delivery Date, Owner Trustee shall have received whatever title to the Aircraft as was conveyed to it by Lessee. (c) Assuming the due authorization, execution and delivery of the Trust Agreement by Owner Participant, Owner Trustee has duly authorized, and on the Delivery Date shall have duly issued, executed and delivered to Loan Trustee for authentication, the Equipment Notes pursuant to the terms and provisions hereof and of the Indenture, and each Equipment Note on the Delivery Date will constitute the valid and binding obligation of Owner Trustee and will be entitled to the benefits and security afforded by the Indenture in accordance with the terms of such Equipment Note and the Indenture. (d) Neither the execution and delivery by Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, of any of the Operative Documents to which Owner Trustee is a party, nor the consummation by Owner Trustee of any of the transactions contemplated thereby, nor the compliance by Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, with the terms and provisions thereof, (i) requires or will require any approval of its stockholders, or approval or consent of any trustees or holders of any indebtedness or obligations of it or (ii) violates or will violate its articles of association or by-laws, or contravenes or will contravene any provision of, or constitutes or will constitute a default under, or results or will result in any breach of, or results or will result in the creation of any Lien (other than as permitted under the Operative Documents) upon its property under, any indenture, mortgage, chattel mortgage, deed of trust, conditional sale contract, bank loan or credit agreement, license or other agreement or instrument to which it is a party or by which it is bound, or contravenes or will contravene any law, governmental rule or regulation of the United States of America or the State of Utah governing the trust powers of Owner Trustee, or any judgment or order applicable to or binding on it. (e) No consent, approval, order or authorization of, giving of notice to, or registration with, or taking of any other action in respect of, any Utah state or local governmental authority or agency or any United States federal governmental authority or agency regulating the trust powers of Owner Trustee in its individual capacity is required for the execution and delivery of, or the carrying out by, Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, of any of the transactions contemplated by the Trust Agreement, this Agreement, the Amended and Restated Indenture, the Lease or the Equipment Notes, or any other Operative Document to which it is a party or by which it is bound, other than any such consent, approval, order, authorization, registration, notice or action as has been duly obtained, given or taken or which is described in Subsection 4.01(e). (f) There exists no Lessor Lien (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to Owner Trustee, in its individual capacity. (g) There exists no Lessor Lien (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to Owner Trustee, as lessor under the Lease. (h) There are no Taxes payable by Owner Trustee, either in its individual capacity or as Owner Trustee, imposed by the State of Utah or any political subdivision thereof in connection with the issuance of the Equipment Notes, or the execution and delivery in its individual capacity or as Owner Trustee, as the case may be, of any of the instruments referred to in clauses (a), (b), (c) and (d) above, that, in each case, would not have been imposed if the Trust Estate were not located in the State of Utah and Wells Fargo Bank Northwest, National Association had not (i) had its principal place of business in, (ii) performed (in its individual capacity or as Owner Trustee) any or all of its duties under the Operative Documents in, and (iii) engaged in any activities unrelated to the transactions contemplated by the Operative Documents in, the State of Utah. (i) There are no pending or, to its knowledge, threatened actions or proceedings against Owner Trustee, either in its individual capacity or as Owner Trustee, before any court or administrative agency, which, if determined adversely to it, would materially adversely affect the ability of Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, to perform its obligations under any of the instruments referred to in clauses (a), (b), (c) and (d) above. (j) Its chief executive office and principal place of business, and the place where its records concerning the Aircraft and all its interests in, to and under all documents relating to the Trust Estate, are located in Salt Lake City, Utah. Wells Fargo Bank Northwest, National Association, in its individual capacity, agrees that it will not change the location of such office to a location outside of Salt Lake City, Utah, without prior written notice to all parties hereto. (k) Owner Trustee has not, in its individual capacity or as Owner Trustee, directly or indirectly offered any Equipment Note or Pass Through Certificate or any interest in or to the Trust Estate, the Trust Agreement or any similar interest for sale to, or solicited any offer to acquire any of the same from, anyone other than Pass Through Trustees and Owner Participant, and no officer or responsible employee of the Corporate Trust Department of Wells Fargo Bank Northwest, National Association has knowledge of any such offer or solicitation by anyone other than Lessee. Owner Trustee has not authorized anyone to act on its behalf (it being understood that in arranging and proposing the financing contemplated hereby and agreed to herein by Owner Trustee, Lessee has not acted as agent of Owner Trustee) to offer directly or indirectly any Equipment Note, any Pass Through Certificate or any interest in and to the Trust Estate, the Trust Agreement or any similar interest for sale to, or to solicit any offer to acquire any of the same from, any Person. (l) It is a Citizen of the United States (without making use of a voting trust agreement, voting powers agreement or similar arrangements). (m) There has not occurred any event which constitutes (or, to the best of its knowledge would, with the passing of time or the giving of notice or both, constitute) an Event of Default as defined in the Indenture which has been caused by or relates to Owner Trustee, in its individual capacity, and which is presently continuing. (n) On the Delivery Date Owner Trustee shall receive whatever title to the Aircraft as is conveyed to it by Lessee. (o) Owner Trustee agrees to furnish to Lessee copies of all periodic reports sent by it to the FAA (or to the aeronautical authority of the country of registry of the Aircraft if the Aircraft is not registered under the laws of the United States) relating to the Aircraft, notices and other correspondence received by it from the FAA (or from the aeronautical authority of the country of registry of the Aircraft if the Aircraft is not registered under the laws of the United States) relating to the Aircraft and any other documents, affidavits or instruments relating to the Aircraft or the Owner Trustee's ownership thereof in its possession after the date hereof. Section 5.04 Representations, Warranties and Covenants of Noteholders. Each of Noteholders, by acceptance of its Equipment Note, represents, warrants and covenants that: (a) Neither it nor anyone acting in its behalf has offered any Equipment Note for sale to, or solicited any offer to buy any Equipment Note from, any Person other than in a manner in compliance with, and which does not require registration under, the Securities Act of 1933, as amended, or the rules and regulations thereunder. (b) The Equipment Note to be issued to such Noteholder pursuant to the Indenture is being acquired by such Noteholder for investment and not with a view to resale or distribution (it being understood that such Noteholder may pledge or assign as security its interest in each Equipment Note issued to it ), provided that the disposition of its property shall at all times be and remain within its control, except that such Noteholder may sell, transfer or otherwise dispose of any Equipment Note or any portion thereof, or grant participations therein, in a manner which in itself does not require registration under the Securities Action of 1933, as amended. (c) It shall not transfer any interest in any Equipment Note unless and until the transferee agrees in writing (copies of which shall be provided by Loan Trustee to Lessee, Owner Participant and Owner Trustee) to make the representations and warranties contemplated to be made by a Noteholder in this Agreement and to be bound by the terms of this Agreement and the Indenture (including, without limitation, the representations, warranties and covenants set forth in this Section 5.04 (including this Subsection (c)), in Subsections 6.01(a), 6.01(b) and 6.01(c), in Section 11.01, and in Sections 2.18, 2.19 and 4.03 of the Indenture. ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements. (a) Each of State Street, Loan Trustee, Subordination Agent, Owner Trustee, Owner Participant, each Pass Through Trustee and any other Noteholder agrees that, unless an Event of Default shall have occurred and be continuing, it shall not take any action contrary to, or otherwise in any way interfere with or disturb (and then only in accordance with the Lease), the quiet enjoyment of the use and possession of the Aircraft, the Airframe, any Engine or any Part by Lessee or any transferee of any interest in any thereof permitted under the Lease. (b) Each Noteholder, including, without limitation, Subordination Agent and each Pass Through Trustee, unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Noteholder Liens with respect to the Aircraft or any portion of the Trust Estate, and such Noteholder agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Noteholder Lien; and each Noteholder hereby agrees to indemnify, protect, defend and hold harmless each Indemnitee and Lessee against Claims in any way resulting from or arising out of a breach by it of its obligations under this Subsection 6.01(b). Each Noteholder further agrees to make restitution to the Trust Estate for any actual diminution of the assets of the Trust Estate resulting from such Noteholder Lien. (c) By its acceptance of its Equipment Notes, each Noteholder (i) unconditionally agrees for the benefit of Lessee and Loan Trustee to be bound by and to perform and comply with all of the terms of such Equipment Notes, the Indenture and this Agreement applicable to such Noteholder and (ii) agrees that it will not transfer any Equipment Note (or any part thereof) to any entity unless such entity makes (or is deemed to have made) a representation and warranty as of the date of transfer that either no part of the funds to be used by it for the purchase and holding of such Equipment Note (or any part thereof) constitutes assets of any "employee benefit plan" or that such purchase and holding will not result in a non-exempt prohibited transaction under Section 4975 of the Code and Section 406 of ERISA. (d) Each of Lessee, Owner Trustee, Owner Participant, Loan Trustee, each Pass Through Trustee and Subordination Agent covenants that (i) until one year and one day after the Series G-1 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-1 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-1 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-1 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G Pass Through Trust, (ii) until one year and one day after the Series G-2 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-2 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-2 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-2 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-2 Pass Through Trust, and (iii) until one year and one day after the Series C Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class C Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class C Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class C Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class C Pass Through Trust. (e) Each of Owner Participant and Wells Fargo Bank Northwest, National Association, in its individual capacity, represents and warrants to the other parties to this Agreement that it is, and on the Delivery Date will be, a Citizen of the United States without making use of any voting trust, voting powers agreement or similar arrangement. Owner Participant agrees, solely for the benefit of Lessee and Noteholders, that if (i) it shall cease to be, or believes itself likely to cease to be, a Citizen of the United States and (ii) the Aircraft shall or would therefore become ineligible for registration in the name of Owner Trustee under the Transportation Code and regulations then applicable thereunder, then Owner Participant shall (at its own expense and without any reimbursement or indemnification from Lessee) promptly effect a voting trust, voting powers agreement or other similar arrangement or take any other action as may be necessary to prevent any deregistration and to maintain the United States registration of the Aircraft. Owner Participant shall be liable to pay on request to each of the other parties hereto and to each holder of an Equipment Note compensation for any damages suffered by any such other party or holder as the result of the representation and warranty of Owner Participant in the first sentence of this Subsection 6.01(e) being untrue as of the Delivery Date. Owner Participant shall be liable to pay on request to Lessee, any Permitted Sublessee and Noteholders compensation for any damages which may be incurred by Lessee, any Permitted Sublessee or Noteholders as a result of Owner Participant's failure to comply with its obligations pursuant to the second sentence of this Subsection 6.01(e). Each party hereto agrees, upon the request and at the sole expense of Owner Participant, to cooperate with Owner Participant in complying with its obligations under the provisions of the second sentence of this Subsection 6.01(e). Wells Fargo Bank Northwest, National Association, in its individual capacity, agrees that if at any time an officer or responsible employee of the Corporate Trust Department of Wells Fargo Bank Northwest, National Association, obtains actual knowledge that Wells Fargo Bank Northwest, National Association, has ceased to be a Citizen of the United States without making use of a voting trust, voting powers agreement or similar arrangement, it will promptly resign as Owner Trustee (if and so long as such citizenship is necessary under the Transportation Code as in effect at such time or, if it is not necessary, if and so long as Owner Trustee's citizenship would have any adverse effect on Noteholders, Lessee or Owner Participant), effective upon the appointment of a successor Owner Trustee in accordance with Section 9.01 of the Trust Agreement. Owner Trustee in its individual capacity shall bear all costs and expenses incurred in connection with such resignation or transfer, provided that such cessation of citizenship was not caused by Owner Participant. If Owner Participant or Wells Fargo Bank Northwest, National Association, in its individual capacity, does not comply with the requirements of this Subsection 6.01(e), Owner Trustee, Loan Trustee and Noteholders hereby agree that an Event of Default (or an event which would constitute an Event of Default but for lapse of time or the giving of notice or both) shall not have occurred and be continuing under the Lease due to non-compliance by Lessee with the registration requirements in the Lease. (f) Loan Trustee, Noteholders, Owner Trustee, Owner Participant, Subordination Agent and each Pass Through Trustee agree to execute and deliver, at Lessee's expense, all such documents as Owner Trustee or Lessee reasonably requests for the purpose of continuing the registration of the Aircraft at the FAA in Owner Trustee's name. Loan Trustee, Noteholders, Owner Trustee, Owner Participant, Subordination Agent and each Pass Through Trustee agree that Lessee, at its own expense, may cause or allow the Aircraft to be duly registered under the laws of any foreign jurisdiction in which a Permitted Sublessee could be principally based, in the name of Owner Trustee, or, if required by applicable law, in the name of any other Person (and, following any such foreign registration, may cause the Aircraft to be re-registered under the laws of the United States); provided, that in the case of jurisdictions other than those approved by Loan Trustee with the consent of a Majority in Interest of Noteholders and Owner Participant (i) if such jurisdiction is at the time of registration listed on Exhibit I, Loan Trustee and Owner Participant shall have received at the time of such registration an opinion of counsel to Lessee to the effect that (A) the Lease and Owner Trustee's right to repossession under the Lease is valid and enforceable under the laws of such country, (B) after giving effect to such change in registration, the Lien of the Indenture shall continue as a valid Lien and shall be duly perfected in the new jurisdiction of registration and that all filing, recording or other action necessary to perfect and protect the Lien of the Indenture has been accomplished (or if such opinion cannot be given at such time, (x) the opinion shall detail what filing, recording or other action is necessary and (y) Loan Trustee and Owner Participant shall have received a certificate from a Responsible Officer of Lessee that all possible preparations to accomplish such filing, recording and other action shall have been done, and such filing, recording and other action shall be accomplished and a supplemental opinion to that effect shall be promptly delivered to Loan Trustee and Owner Participant subsequent to the effective date of such change in registration), (C) the obligations of Lessee under the Lease shall remain valid, binding and (subject to customary bankruptcy and equitable remedies exceptions and to other exceptions customary in foreign opinions generally) enforceable under the laws of such jurisdiction (or the laws of the jurisdiction to which the laws of such jurisdiction would refer as the applicable governing law) and (D) all approvals or consents of any government in such jurisdiction having jurisdiction required for such change in registration shall have been duly obtained and shall be in full force and effect, and (ii) if such jurisdiction is at the time of registration not listed on Exhibit I, Loan Trustee and Owner Participant shall have received (in addition to the opinions set forth in clause (i) above) at the time of such registration an opinion of counsel to Lessee to the effect that (A) the terms of the Lease are legal, valid, binding and enforceable in such jurisdiction (subject to exceptions customary in such jurisdiction, provided, that, subject to exceptions relating to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and exceptions relating to general principles of equity, such counsel shall opine that any applicable laws limiting the remedies provided in Section 15 of the Lease do not in the opinion of such counsel make the remedies provided in Section 15 of the Lease inadequate for the practical realization of the rights and benefits provided thereby), (B) that it is not necessary, solely as a consequence of such change in registration and without giving effect to any other activity of Owner Trustee, Owner Participant or Loan Trustee (or any affiliate thereof), as the case may be, for Owner Trustee, Owner Participant or Loan Trustee to register or qualify to do business in such jurisdiction, (C) that there is no tort liability of the owner of an aircraft not in possession thereof under the laws of such jurisdiction other than tort liability that might have been imposed on such owner under the laws of the United States or any state thereof (it being understood that such opinion shall be waived if insurance reasonably satisfactory to Owner Participant is provided, at Lessee's expense, to cover such risk) and (D) (unless Lessee shall have agreed to provide insurance covering the risk of requisition of use or title of the Aircraft by the government of such jurisdiction so long as the Aircraft is registered under the laws of such jurisdiction) that the laws of such jurisdiction require fair compensation by the government of such jurisdiction payable in currency freely convertible into Dollars for the loss of use or title of the Aircraft in the event of requisition by such government of such use or title. Owner Trustee, Owner Participant and Loan Trustee will cooperate with Lessee in effecting such foreign registration. Notwithstanding the foregoing, prior to any such change in the country of registry of the Aircraft, the following conditions shall be met: (i) no Event of Default shall have occurred and be continuing at the effective date of the change in registration; provided, that it shall not be necessary to comply with this condition if the change in registration results in the registration of the Aircraft under the laws of the United States or if Owner Participant and a Majority in Interest of Noteholders consent to such change in registration; (ii) Loan Trustee, Owner Trustee and Owner Participant shall have received evidence of compliance with the insurance provisions contained in the Lease after giving effect to such change in registration; and (iii) Lessee shall have paid or made provision reasonably satisfactory to Loan Trustee and Owner Participant for the payment of all reasonable expenses (including reasonable attorneys' fees) of Loan Trustee, Owner Trustee, Owner Participant and Noteholders in connection with such change in registration. (g) Each of Wells Fargo Bank Northwest, National Association, in its individual capacity, and Owner Participant covenants and agrees that it shall not cause or permit to exist a Lessor Lien attributable to it with respect to the Aircraft or any other portion of the Trust Estate. Each of Wells Fargo Bank Northwest, National Association, in its individual capacity, and Owner Participant agrees that it will promptly, at its own expense, take such action as may be necessary duly to discharge such Lessor Lien attributable to it. Each of Wells Fargo Bank Northwest, National Association, in its individual capacity, and Owner Participant agrees to make restitution to the Trust Estate for any actual diminution of the assets of the Trust Estate resulting from Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to it. (h) Owner Participant represents and warrants that it is not acquiring its interest in the Trust Estate or any interests represented thereby with the assets of any "employee benefit plan" as defined in Section 3(3) of ERISA or of any "plan" within the meaning of Section 4975(e)(1) of the Code. Owner Participant agrees that it will not transfer any of its right, title or interest in and to this Agreement, the Trust Estate or the Trust Agreement or any proceeds therefrom to any entity unless such entity makes (or is deemed to have made) a representation and warranty as of the date of transfer that either no part of the funds to be used by it for the purchase of such right, title and interest (or any part thereof) constitutes assets of any "employee benefit plan" or that such transfer will not result in a non-exempt prohibited transaction (under Section 4975 of the Code and Section 406 of ERISA). Each Pass Through Trustee agrees that it will not agree to any amendment, modification or waiver of Section 3.01(g) of the Trust Supplement to any Pass Through Trust Agreement specified in Schedule II without the prior written consent of Owner Participant. (i) State Street, Loan Trustee, Noteholders, Owner Trustee (in its individual capacity and as trustee), Owner Participant, Subordination Agent and each Pass Through Trustee each agrees that it will not disclose, directly or indirectly, to any Person not a party hereto or their respective counsel or advisors any information obtained from Lessee hereunder or in connection herewith or any portion of any Operative Document not filed with the FAA or other governmental agency or authority and available for public inspection ("Confidential Information"), and will use all reasonable efforts to have all such Confidential Information kept confidential and not used in any way known to such party to be detrimental to Lessee, except that (a) each party may use, retain and disclose any such Confidential Information to its special counsel and public accountants, any potential transferees, any affiliate and any governmental agency or instrumentality or other supervisory body (including bank regulators) requesting such disclosure or pursuant to its regulatory or supervisory authority over such party or any affiliate thereof, provided that such special counsel, public accountants, or potential transferees agree in advance to keep such Confidential Information confidential, (b) each party may use, retain and disclose any such Confidential Information that has been publicly disclosed (other than by such party or any affiliate thereof in breach of this paragraph) or has rightfully come into the possession of such party or any affiliate thereof (other than from Lessee) on a nonconfidential basis, (c) each party may use, retain and disclose any such Confidential Information as required by law, rule, regulation or any governmental agency, (d) each party may use, retain and disclose any such Confidential Information where such Confidential Information was previously known to the subject party free of any obligation to keep it confidential, (e) each party may use, retain and disclose any such Confidential Information to third parties in connection with or in response to any order, decree, judgment, subpoena, notice of discovery or similar ruling or pleading (provided, that each party shall endeavor in good faith to prevent the disclosure of such Confidential Information pursuant to any such order, decree, judgment, subpoena, notice of discovery or similar ruling or pleading) or as part of its normal reporting or review procedure to its auditors, regulators, parent company or affiliates, and (f) each party may use, retain and disclose any such Confidential Information to the extent necessary to obtain appropriate insurance or in order to enforce its rights and performance obligations pursuant to the Operative Documents. For any breach of the foregoing covenants, the injured party shall be entitled to injunctive relief or any other legal or equitable remedies available, including the recovery of damages suffered as a result of such breach, but no such breach shall constitute an Event of Default. (j) Owner Trustee and Owner Participant severally, not jointly, represent and warrant that none of the funds made available by Pass Through Trustee pursuant to Section 2.01 will be used for the purpose of purchasing or carrying any "margin security" as defined in Regulation U of the Board of Governors of the Federal Reserve System or for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry such margin security or for any other purpose which might cause the transaction contemplated by this Agreement to constitute a "purpose credit" within the meaning of Regulation X of the Board of Governors of the Federal Reserve System, assuming that the proceeds were and are applied as contemplated by the provisions of this Agreement. (k) Each of Owner Participant, Owner Trustee, Loan Trustee and Lessee covenants and agrees that if Lessee elects to terminate the Lease and purchase the Aircraft pursuant to Section 19(d) of the Lease, then each of the parties will execute and deliver appropriate documentation transferring all right, title and interest in the Aircraft to Lessee (including, without limitation, such bills of sale and other instruments and documents as Lessee reasonably requests), and if Lessee, in connection with such purchase, elects to assume the obligations of Owner Trustee pursuant to the Indenture and the Equipment Notes, each of the parties will execute and deliver appropriate documentation permitting Lessee to assume such obligations on the basis of full recourse to Lessee, maintaining the security interest in the Aircraft created by the Indenture, releasing Owner Participant and Owner Trustee from all future obligations in respect of the Equipment Notes, the Indenture and all other Operative Documents and all such other actions as are reasonably necessary to permit such assumption by Lessee. Notwithstanding the foregoing, Lessee shall not be entitled to assume the obligations of Owner Trustee in respect of the Equipment Notes unless Lessee causes to be delivered to Loan Trustee (a) an opinion of counsel to the effect that (i) the Lien of the Indenture continues to be a valid and duly perfected first priority security interest in and to the Aircraft, (ii) Loan Trustee will be entitled to the benefits of Section 1110 (if immediately prior to such assumption Owner Trustee was entitled to the benefits of Section 1110) and (iii) the Pass Through Trusts will not be subject to Federal income taxation and the holders of the Pass Through Certificates will not recognize income, gain or loss for Federal income tax purposes as a result of such assumption and will be subject to Federal income tax in the same amounts, in the same manner, and at the same time as would have been the case if such assumption had not occurred and (b) written confirmation from the Rating Agencies that such assumption will not result in a withdrawal, suspension or downgrading of the rating of any class of Pass Through Certificates (without regard to the Policy (as defined in the Policy Provider Agreement)). In addition, unless waived by Noteholders, Lessee shall not be entitled to assume the Equipment Notes on the date for purchase of the Aircraft pursuant to Section 19(d) of the Lease if on such date an Event of Default shall have occurred and be continuing or any condition or event shall exist which, with the passage of time or giving of notice or both, would become such an Event of Default. (l) Wells Fargo Bank Northwest, National Association and State Street each agrees for the benefit of Lessee to comply with the terms of the Indenture which it is required to comply with in its individual capacity. (m) Each of Owner Participant and Owner Trustee hereby (A) agrees with Lessee and Noteholders to comply with all of the terms of the Trust Agreement (as the same may hereafter be amended or supplemented from time to time in accordance with the terms thereof) applicable to it; (B) agrees with Lessee and Loan Trustee not to amend, supplement or otherwise modify any provision of the Trust Agreement in a manner adversely affecting such party without the prior written consent of such party; and (C) agrees with Lessee and Noteholders not to revoke the Trust Agreement without the prior written consent of Lessee (so long as the Lease remains in effect) and Loan Trustee (so long as the Lien of the Indenture remains in effect or there are any Equipment Notes outstanding). Notwithstanding the foregoing, so long as the Lease has not been terminated, Loan Trustee and Owner Trustee hereby agree for the benefit of Lessee that without the consent of Lessee they will not (i) amend or modify Article III or IX of the Indenture, (ii) make any amendment which will affect the stated principal amount or interest on the Equipment Notes or (iii) amend or modify the provisions of Sections 2.05 or 10.15 of the Indenture. Loan Trustee and Owner Trustee agree to furnish to Lessee promptly copies of any supplement, amendment, waiver or modification of any of the Operative Documents to which Lessee is not a party. Notwithstanding anything to the contrary contained herein, in the Trust Agreement or in any other Operative Document, Owner Participant will not consent to or direct a change in the situs of the Trust Estate without the prior written consent of Lessee. Each Noteholder agrees that it will not take any action in respect of the Indenture Estate except through Loan Trustee pursuant to the Indenture or as otherwise permitted by the Indenture. (n) Owner Participant will not, directly or indirectly sell, assign, convey or otherwise transfer any of its right, title or interest in and to this Agreement, the Trust Estate or the Trust Agreement or any proceeds therefrom to any person or entity, unless (i) the proposed transferee is a "Transferee" (as defined below), (ii) Lessee shall have received from Owner Participant so seeking to transfer such right, title or interest reasonably satisfactory indemnification for any loss of tax benefits to, and increase in the tax liability of, Lessee, and (iii) Owner Participant sells, assigns, conveys or otherwise transfers all of its right, title and interest in and to this Agreement, the Trust Estate, the Trust Agreement and the proceeds therefrom to a single entity. A "Transferee" means either (A) a bank or other financial institution with a combined capital, surplus and undivided profits of at least $50,000,000 or a corporation whose tangible net worth is at least $50,000,000, exclusive of goodwill, in either case as of the proposed date of such transfer, as determined in accordance with generally accepted accounting principles, or (B) any subsidiary of such a bank, financial institution or corporation, provided that such bank, financial institution or corporation furnishes to Owner Trustee, Loan Trustee and Lessee a guaranty with respect to Owner Participant's obligations, in the case of Owner Trustee, under the Trust Agreement and, in the case of Loan Trustee and Lessee, Owner Participant's obligations hereunder, including but not limited to, under Subsections 6.01(d), 6.01(e), 6.01(g) and 6.01(h), in form and substance reasonably satisfactory to Lessee, Owner Trustee and Loan Trustee. Unless Lessee gives its written consent thereto (which may be given or withheld in its sole discretion), no Transferee may be an airline, a commercial air carrier, an air freight forwarder, an airframe manufacturer, an engine manufacturer, an entity engaged in the business of parcel transport by air or other similar person or a corporation or other entity controlling, controlled by or under common control with such an airline, a commercial air carrier, an air freight forwarder, an airframe manufacturer, an engine manufacturer, an entity engaged in the business of parcel transport by air or other similar person. Each such transfer to a Transferee shall be subject to the condition that (1) upon giving effect to such transfer, the Transferee is a Citizen of the United States (without making use of a voting trust agreement, voting powers agreement or similar arrangement unless approved by Lessee), and has full power and authority to enter into the transactions contemplated hereby, (2) the Transferee has the requisite power and authority to enter into and carry out the transactions contemplated hereby and such Transferee shall have delivered to Lessee, Owner Trustee and Loan Trustee an opinion of counsel in form and substance reasonably satisfactory to such persons as to the due authorization, execution and delivery and the legal, valid and binding effect and enforceability of the agreement or agreements referred to in the next clause with respect to the Transferee and any guaranty provided pursuant to the provisions of this Subsection 6.01(n) as to the guarantor, (3), the Transferee enters into an agreement or agreements, in form and substance reasonably satisfactory to Owner Trustee, Lessee and Loan Trustee, whereby the Transferee confirms that it shall be deemed a party to this Agreement and a party to the Trust Agreement and agrees to be bound by all the terms of, and to undertake all of the obligations of Owner Participant contained in the Operative Documents and makes the representations and warranties made by Owner Participant thereunder, (4) such transfer does not affect the registration of the Aircraft under the Transportation Code, or any rules or regulations promulgated thereunder or create a relationship which would be in violation thereof or violate any provision of the Securities Act of 1933, as amended, or any other applicable Federal or state law, (5) the transferor Owner Participant assumes the risk of any loss of Interest Deductions, Amortization Deductions and MACRS Deductions, the risk of any Inclusion Event (each as defined in the Tax Indemnity Agreement), and the risk of any sales, use, value added, or similar tax resulting from such transfer, (6) the transferor Owner Participant pays all of the costs and expenses (including, without limitation, fees and expenses of counsel) incurred in connection with such transfer, including the costs and expenses of Owner Trustee, Loan Trustee, Lessee and Noteholders in connection therewith, and (7) the terms of the Operative Documents and the Overall Transaction shall not be altered. Upon any such transfer by Owner Participant as above provided, the Transferee shall be deemed Owner Participant for all purposes hereof and of the other Operative Documents and each reference herein to the transferor Owner Participant shall thereafter be deemed for all purposes to be to the Transferee and the transferor Owner Participant shall be relieved of all obligations of the transferor Owner Participant under the Operative Documents to which Owner Participant is a party arising after the date of such transfer except to the extent fully attributable to or arising out of acts or events occurring prior thereto and not assumed by the Transferee (in each case, to the extent of the participation so transferred). If Owner Participant intends to transfer any of its interests hereunder, it shall give 30 days prior written notice thereof to Loan Trustee, Owner Trustee and Lessee, specifying the name and address of the proposed Transferee and demonstrating that the proposed Transferee meets all of the requirements set forth herein. Section 6.02 Certain Covenants of Lessee. Lessee covenants and agrees with Loan Trustee, Owner Participant and Owner Trustee as follows: (a) On and after the Delivery Date, Lessee will cause to be done, executed, acknowledged and delivered such further acts, conveyances and assurances as Loan Trustee, Owner Participant or Owner Trustee reasonably requests for accomplishing the purposes of this Agreement and the other Operative Documents; provided that any instrument or other document so executed by Lessee will not expand any obligations or limit any rights of Lessee in respect of the transactions contemplated by the Operative Documents. Lessee, forthwith upon delivery of the Aircraft under the Lease, shall cause the Aircraft to be duly registered, and at all times thereafter to remain duly registered, in the name of Owner Trustee, except as otherwise required or permitted hereunder or under the Lease, under the Transportation Code, or shall furnish to Owner Trustee such information as may be required to enable Owner Trustee to make application for such registration, and shall promptly furnish to Owner Trustee such information as may be required to enable Owner Trustee to timely file with any governmental authority any reports required to be filed by it as the lessor under the Lease or as the owner of the Aircraft. (b) Lessee will cause the Lease, all Lease Supplements, all amendments to the Lease, the Indenture and all supplements and amendments to the Indenture to be promptly filed and recorded, or filed for recording, with the FAA to the extent permitted under the Transportation Code and the rules and regulations of the FAA thereunder. Upon the execution and delivery of the FAA Bill of Sale, the Lease, the Lease Supplement covering the Aircraft, the Indenture Supplement and the Amended and Restated Indenture shall be filed for recording with the FAA in the following order of priority; first, the FAA Bill of Sale, second, the Amended and Restated Indenture (with the Indenture Supplement covering the Aircraft attached), and third, the Lease (with the Lease Supplement covering the Aircraft, the Amended and Restated Indenture and the Indenture Supplement attached). (c) Lessee, at its expense, will take, or cause to be taken, such action with respect to the recording, filing, re-recording and refiling of the Lease and any financing statements or other instruments as are necessary to maintain, so long as the Lease is in effect, the perfection of the security interests created by the Amended and Restated Indenture or will furnish Loan Trustee, Owner Participant and Owner Trustee timely notice of the necessity of such action, together with such instruments, in execution form, and such other information as may be required to enable Loan Trustee, Owner Participant or Owner Trustee to take such action. In addition, Lessee will pay any and all recording, stamp and other similar taxes payable in the United States, and in any other jurisdiction where the Aircraft is registered, in connection with the execution, delivery, recording, filing, re-recording and refiling of the Indenture or any such financing statements or other instruments. Lessee will notify Loan Trustee, Owner Participant and Owner Trustee of any change in its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Delaware) promptly after making such change or in any event within the period of time necessary under applicable law to prevent the lapse of perfection (absent refiling) of financing statements filed under the Operative Documents. (d) Lessee shall at all times maintain its corporate existence except as permitted by Subsection 6.02(e). (e) Lessee shall not consolidate with or merge into any other Person or convey, transfer or lease substantially all of its assets as an entirety to any Person, unless: (i) the successor or transferee entity shall, if and to the extent required under Section 1110 in order that Owner Trustee continues to be entitled to any benefits of Section 1110 with respect to the Aircraft, be a Citizen of the United States and a Certificated Air Carrier and shall execute and deliver to Loan Trustee, Owner Trustee and Owner Participant an agreement containing the express assumption by such successor or transferee entity of the due and punctual performance and observance of each covenant and condition of the Operative Documents to which Lessee is a party to be performed or observed by Lessee; (ii) immediately after giving effect to such transaction, no Event of Default shall have occurred and be continuing; and (iii) Lessee shall deliver to Loan Trustee, Owner Participant and Owner Trustee a certificate signed by a Responsible Officer of Lessee, and an opinion of counsel (which may be internal counsel to Lessee), each stating that such consolidation, merger, conveyance, transfer or lease and the assumption agreement mentioned in clause (i) above comply with this Subsection 6.02(e) and that all conditions precedent herein relating to such transaction have been complied with (except that such opinion need not cover the matters referred to in clause (ii) above and may rely, as to factual matters, on a certificate of an officer of Lessee) and, in the case of such opinion, that such assumption agreement has been duly authorized, executed and delivered by such successor Person and is enforceable against such successor Person in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. Upon any consolidation or merger, or any conveyance, transfer or lease of substantially all of the assets of Lessee as an entirety in accordance with this Subsection 6.02(e), the successor Person formed by such consolidation or into which Lessee is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, Lessee under this Agreement and the other Operative Documents with the same effect as if such successor Person had been named as Lessee herein. (f) Lessee shall remain a Certificated Air Carrier for as long as and to the extent required under Section 1110 in order that Owner Trustee shall be entitled to any of the benefits of Section 1110 with respect to the Aircraft. (g) Commencing in ____, on or before [April 30] of each year during the Term, Lessee will deliver to Lessor and Loan Trustee a certificate of Lessee, signed by a Responsible Officer of Lessee to the effect that the signer is familiar with or has reviewed the relevant terms of the Lease and the signer does not have actual knowledge of the existence, as of the date of such certificate, of any condition or event which constitutes a Lease Default or an Event of Default. Lessee agrees that if a Responsible Officer of Lessee has actual knowledge of the existence of a Lease Default, then Lessee shall promptly give to Lessor, Owner Participant and Loan Trustee notice thereof and such other information relating thereto as Lessor, Owner Participant or Loan Trustee may reasonably request. During the Term, Lessee agrees to furnish to Lessor, Owner Participant and, so long as any Equipment Notes remain unpaid, Loan Trustee, Policy Provider and Liquidity Provider: (i) within 60 days after the end of each of the first three quarterly periods in each fiscal year of Lessee, either (x) a consolidated balance sheet of Lessee and its consolidated subsidiaries prepared by it as of the close of such period, together with the related consolidated statements of income for such period or (y) a report of Lessee on Form 10-Q in respect of such period in the form filed with the Securities and Exchange Commission and (ii) within 120 days after the close of each fiscal year of Lessee, either (x) a consolidated balance sheet of Lessee and its consolidated subsidiaries as of the close of such fiscal year, together with the related consolidated statements of income for such fiscal year, certified by independent public accountants, or (y) a report of Lessee on Form 10-K in respect of such year in the form filed with the Securities and Exchange Commission. Lessee may fulfill the requirements of the preceding sentence by providing the material described therein in an electronic format by electronic mail or accessible over the Internet. ARTICLE 7 OWNER FOR TAX PURPOSES Section 7.01 Owner for Federal Tax Purposes. It is hereby agreed among Lessee, Owner Participant and Owner Trustee that for Federal income tax purposes Owner Participant will be the owner of the Aircraft and Lessee will be the lessee thereof, and each party hereto agrees to characterize the Lease as a lease for Federal income tax purposes. ARTICLE 8 SITUS OF THE OWNER TRUST Section 8.01 Change of Situs of Owner Trust. Owner Participant agrees that if, at any time, the Trust Estate becomes subject to any Taxes for which it is indemnified pursuant to Section 4.02 and if, as a consequence thereof, Lessee requests that the situs of the trust be moved to another state in the United States from the state in which it is then located, the situs of the trust may be moved with the written consent of Owner Participant (which consent shall not be unreasonably withheld) and Owner Participant will take whatever action may be reasonably necessary to accomplish such removal. Lessee shall provide such additional tax indemnification as Owner Participant and Loan Trustee may reasonably request, the rights and obligations under the Operative Documents of Owner Participant and Loan Trustee shall not be altered as a result of the taking of such action, the Lien of the Indenture on the Indenture Estate shall not be adversely affected by such action, Owner Participant and Loan Trustee shall have received an opinion or opinions of counsel (satisfactory to each recipient), in scope, form and substance satisfactory to them to the effect that (i) the trust, as thus removed, remains a validly established trust, (ii) any amendments to the Trust Agreement necessitated by such removal have been duly authorized, executed and delivered by the parties thereto and constitute the valid and binding obligations of such parties, enforceable in accordance with their terms, (iii) such removal will not result in the imposition of, or increase in the amount of, any Tax for which Lessee is not required to indemnify Owner Participant, Loan Trustee, Owner Trustee or the Trust Estate pursuant to Section 4.02 (taking into account any additional indemnification provided by Lessee pursuant to the first clause of this sentence), and (iv) such removal will not result in any loss of Interest Deductions or MACRS Deductions or an Inclusion Event (as defined in the Tax Indemnity Agreement) with respect to which Lessee is not required to indemnify Owner Participant pursuant to Section [4] of the Tax Indemnity Agreement (taking into account any additional indemnification provided by Lessee pursuant to the first clause of this sentence). If such removal involves the replacement of Owner Trustee, Loan Trustee and Owner Participant must also receive an opinion of counsel to such successor Owner Trustee in form and substance reasonably satisfactory to each recipient covering the matters described in the opinion delivered pursuant to Subsection 3.01(k) and such other matters as they reasonably request. Lessee shall indemnify and hold harmless Owner Participant and Loan Trustee on an After-Tax Basis against any and all reasonable and actual costs and expenses including reasonable counsel fees and disbursements, registration fees, recording or filing fees and taxes incurred by Owner Trustee, Owner Participant and Loan Trustee in connection with such change of situs. ARTICLE 9 INSTRUCTIONS TO OWNER TRUSTEE Section 9.01 Instructions to Owner Trustee. Owner Participant agrees that its releasing the amount of its Commitment for the Aircraft to the account of Owner Trustee in accordance with the terms of Article 2 shall constitute, subject to satisfaction or waiver of the conditions set forth in Section 3.01, without further act, authorization and direction by Owner Participant to Owner Trustee: (i) to pay to Lessee Lessor's Cost for the Aircraft; (ii) to accept from Lessee the FAA Bill of Sale and the Bill of Sale; (iii) to execute an Aircraft Registration Application, the Lease Supplement and the Indenture Supplement, in each case covering the Aircraft; (iv) to issue the Assumed Equipment Notes to Pass Through Trustee to finance a portion of the Lessor's Cost for the Aircraft and to execute and deliver to Subordination Agent on behalf of Pass Through Trustee for each of the Pass Through Trusts a principal amount of Assumed Equipment Notes bearing the interest rate set forth opposite the name of such Pass Through Trust on Schedule I, which Assumed Equipment Notes shall be in the principal amounts set forth on Schedule I, pursuant hereto and to the Amended and Restated Indenture; and (v) to take such other action as may be required to be taken by Owner Trustee on the Delivery Date by the terms of any Operative Document. ARTICLE 10 INTEREST OF NOTEHOLDERS Section 10.01 Extent of Interest of Noteholders. No Noteholder shall have any further interest in, or other right with respect to, the mortgage and security interests created by the Indenture when and if the principal of and interest on all Equipment Notes held by such holder and all other sums payable to such holder hereunder, under the Indenture and under such Equipment Notes are paid in full. Each Pass Through Trustee and, by its acceptance of an Equipment Note, each Noteholder agrees that it will look solely to the income and proceeds from the Indenture Estate to the extent available for distribution to such Noteholder as provided in Article III of the Indenture and that neither Owner Participant nor Owner Trustee shall be personally liable to Pass Through Trustees or any Noteholder for any amounts payable under the Equipment Notes, the Indenture or hereunder, except as expressly provided in the Operative Documents. ARTICLE 11 EXCESS AMOUNT Section 11.01 Excess Amount. Loan Trustee, and by acceptance of the Equipment Notes Noteholders, hereby (i) agree that for purposes of the application of Section 1111(b) of the Bankruptcy Code or any successor provision or any comparable provisions that the "debtor" in any bankruptcy proceeding involving the assets held or administered pursuant to the Trust Agreement shall be strictly limited to the Trust Estate (excluding the Excluded Payments) and (ii) make (and hereby agree to make), with respect to the Indenture Estate, the election provided for in Section 1111(b)(2) of the Bankruptcy Code. It is hereby agreed by Loan Trustee, and by the acceptance of the Equipment Notes Noteholders hereby agree, that if (i) all or any part of the Trust Estate becomes the property of, or Owner Participant becomes, a debtor subject to the reorganization provisions of the Bankruptcy Code or any comparable proceeding, (ii) pursuant to such reorganization provisions Owner Trustee (in its individual capacity) or Owner Participant is required, by reason of Owner Trustee (in its individual capacity) or Owner Participant being held to have recourse liability to the holder(s) of the Equipment Notes or to Loan Trustee, directly or indirectly (other than the recourse liability of Owner Participant under this Agreement), to make payment on account of any amount payable as principal or interest on the Equipment Notes and (iii) any holder(s) of the Equipment Notes or Loan Trustee actually receives any Excess Amount which reflects any payment by Owner Trustee (in its individual capacity) or Owner Participant on account of clause (ii) above, then such holder(s) or Loan Trustee, as the case may be, shall promptly refund to Owner Trustee or Owner Participant (whichever shall have made such payment) such Excess Amount. For purposes of this Section 11.01, "Excess Amount" means the amount by which such payment exceeds the amount which would have been received by the holder(s) of the Equipment Notes or Loan Trustee if Owner Trustee (in its individual capacity) or Owner Participant had not become subject to the recourse liability referred to in (ii) above. Nothing contained in this Section 11.01 shall prevent the holder of an Equipment Note or Loan Trustee from enforcing any personal recourse obligation (and retaining the proceeds thereof) of Owner Trustee (in its individual capacity) or Owner Participant under this Agreement or the Indenture (and any exhibits or annexes thereto). ARTICLE 12 TRANSACTION EXPENSES Section 12.01 Invoices and Payment. Each of the parties hereto shall promptly submit to Owner Trustee and Lessee for their prompt approval (which shall not be unreasonably withheld) copies of invoices in reasonable detail of the Transaction Expenses for which it is responsible for providing information as they are received (but in no event later than [________________]). Owner Participant agrees to transfer to Owner Trustee promptly but in any event no later than [______________] the amount necessary for Owner Trustee to pay Transaction Expenses. To the extent of funds received by it, Owner Trustee agrees to pay all invoices of Transaction Expenses that have been approved by it and Lessee promptly upon receipt thereof. Notwithstanding the foregoing, Lessee may pay directly any or all Transaction Expenses in excess of [____]% of Lessor's Cost. Section 12.02 Payment of Other Expenses. If the transaction contemplated by this Agreement fails to close as a result of Owner Participant's failure to negotiate in good faith or to comply with the terms and conditions upon which its participation in the transaction was predicated, Owner Participant will be responsible for all of its fees and expenses, including but not limited to the fees, expenses and disbursements of its special counsel. ARTICLE 13 REFINANCINGS Section 13.01 Refinancings. (a) So long as no Event of Default has occurred and is continuing, Lessee may refinance all (but not less than all) of the Equipment Notes no more than three times by giving written notice to Owner Participant and Owner Trustee for a voluntary redemption of the Equipment Notes by Owner Trustee. Owner Participant will negotiate promptly in good faith to conclude an agreement with Lessee as to the terms of such refinancing (including the terms of any debt to be issued in connection with such refinancing). No such refinancing may increase Owner Participant's investment in the beneficial ownership of the Aircraft. Upon such agreement: (1) Within ten Business Days of such agreement, Owner Participant will deliver to Lessee a certificate of an authorized representative of Owner Participant (the "Refinancing Certificate") setting forth (i) the proposed date on which the outstanding Equipment Notes will be redeemed, any new debt will be issued and the other aspects of such refinancing will be consummated (such date, the "Refinancing Date") and (ii) the following information calculated pursuant to the provisions of paragraph (7) of this Subsection 13.01(a): (A) subject to the limitations set forth in this Section 13.01, the proposed adjusted debt/equity ratio, (B) the principal amount of debt to be issued by Owner Trustee on the Refinancing Date, (C) the amount, if any, by which Owner Participant's aggregate investment in the beneficial interest in the Aircraft is to be decreased and (D) the proposed revised schedules of Basic Rent percentages and allocations, debt amortization, Special Purchase Price, [Initial Installment, Remaining Installments,] Stipulated Loss Value percentages and Termination Value percentages. (2) Within fourteen days of its receipt of the Refinancing Certificate, Lessee may demand a verification of the information set forth therein pursuant to Exhibit E to the Lease. (3) Upon the acceptance by Lessee of the accuracy of the information set forth in the Refinancing Certificate (or the determination pursuant to such verification procedures), the appropriate parties will enter into appropriate documentation (which may involve an underwriting agreement in connection with such sale) with the institution or institutions to be named therein providing for (i) the issuance and sale by Owner Trustee to such institution or institutions on the Refinancing Date of debt securities in an aggregate principal amount specified in the Refinancing Certificates (or determined pursuant to the verification procedures) which amount shall be equal to the aggregate principal amount of all Equipment Notes outstanding on the Refinancing Date (such debt securities, the "New Debt") except that the principal amount of New Debt may exceed the principal amount of all outstanding Equipment Notes in connection with the first refinancing under this Section 13.01 but may not be more than 105% of the principal amount of such outstanding Equipment Notes and the maturity of the New Debt may not exceed by more than 6 months the maturity of the Equipment Notes outstanding on the Refinancing Date, (ii) the application of the proceeds of the sale of the New Debt to the redemption of all such Equipment Notes on the Refinancing Date and (iii) the payment to Owner Trustee of the excess, if any, of such proceeds over the amounts necessary to effect such redemption. (4) Lessee shall notify Loan Trustee pursuant to Section 2.11 of the Indenture, and Lessee and Owner Trustee will amend the Lease to provide that (i) Basic Rent payable in respect of the period from and after the Refinancing Date shall be as provided in the Refinancing Certificates (or determined pursuant to the verification procedures) and (ii) amounts payable in respect of the Special Purchase Price, [Initial Installment, Remaining Installments,] Stipulated Loss Value and Termination Value from and after the Refinancing Date shall be as provided in the Refinancing Certificates (or determined pursuant to the verification procedures); (5) Owner Trustee will enter into an agreement to provide for the securing thereunder of the New Debt in like manner as the Equipment Notes and will enter into such amendments and supplements to the Indenture (or such new indenture or other security agreement) as may be necessary to effect such refinancing; (6) Owner Participant shall pay all of the expenses (other than those of Lessee) of such refinancing (including, but not limited to, the fees, expenses and disbursements of counsel and any placement or underwriting fees) and such expenses shall be treated as Transaction Expenses; and (7) when calculating any of the information required to be set forth in a Refinancing Certificate, Owner Participant shall make such calculations in a manner which (A) maintains Owner Participant's Net Economic Return (except to the extent the assumptions referred to in the definition of "Net Economic Return" have been altered since the Delivery Date in connection with an adjustment to Rents pursuant to Section 3(c) of the Lease or such assumptions are the subject of the recalculations being conducted by Owner Participant), and (B) to the extent possible consistent with clause (A), minimizes the Net Present Value of Rents. (b) The Equipment Notes are not subject to voluntary redemption by Owner Trustee without the consent of Lessee except as set forth in Section 2.19 of the Indenture. ARTICLE 14 RELEASE OF COLLATERAL Section 14.01 Release of Collateral, Assumption and Release. (a) Effective upon, and simultaneously with, the Participants' making their Commitments available pursuant to Section 2, but immediately prior to the execution and delivery of the Amended and Restated Indenture, Loan Trustee agrees that the Collateral (as such term is defined in the Original Indenture) described in paragraph (2) of the Granting Clause of the Original Indenture (the "Released Collateral") is hereby released from the Lien of the Original Indenture, and the parties hereto consent and agree that the Released Collateral shall so be released. (b) Effective upon and by the execution and delivery of the Amended and Restated Indenture, Owner Trustee assumes in accordance with the terms of the Amended and Restated Indenture all of the obligations and liabilities of Lessee under the Original Indenture and the Original Equipment Notes to the extent such liabilities and obligations are set forth in the Amended and Restated Indenture (as provided in and collectively evidenced by the Assumed Equipment Notes and the Amended and Restated Indenture), provided that Noteholders and Loan Trustee agree to look only to Lessee, and Lessee hereby agrees that it is solely responsible, for claims with respect to indemnity and all other obligations (other than as to interest accruing after the Delivery Date and as to principal on the Equipment Notes) arising, or as a result of acts or omissions occurring, prior to the Delivery Date. Concurrently with such assumption and subject to the immediately preceding sentence, Loan Trustee and Pass Through Trustee for each Pass Through Trust each, without further act, hereby releases Lessee from all liabilities and obligations under the Original Indenture including, without limitation, all liabilities and obligations under the Original Equipment Notes. ARTICLE 15 DELIVERY DATE INTEREST PAYMENT Section 15.01 Delivery Date Interest Payment. (a) Lessee shall pay to Loan Trustee on the Delivery Date and immediately prior to the execution and delivery of the Amended and Restated Indenture, interest accrued on the Original Equipment Notes from and including the date of issuance of the Original Equipment Notes, to, but excluding, the Delivery Date. Loan Trustee shall deposit such payments in a non-interest bearing account for payment to Noteholders on the next Payment Date. (b) Amounts payable by Lessee pursuant to Subsection 15.01(a) shall be paid to Loan Trustee at State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110, ABA No. 011-00-0028, Account No. 9903-990-1, Attention: Corporate Trust Department, Reference: Delta (N_____), by wire transfer of immediately available funds in Dollars. (c) Loan Trustee agrees that its authentication of the Assumed Equipment Notes shall constitute its acknowledgement, without further act, of its receipt in full of the interest payable pursuant to Subsection 15.01(a). (d) Each of the parties hereto agrees that, for Federal income tax purposes, (A) Lessee shall be treated as the initial borrower with respect to the Equipment Notes and may deduct as its interest expense all interest paid or payable with respect to the Equipment Notes for the period prior to the Delivery Date, and (B) Owner Trustee shall be treated as the borrower with respect to the Equipment Notes on and after the Delivery Date. ARTICLE 16 MISCELLANEOUS Section 16.01 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and any such notice may be given by registered or certified United States mail, courier service or facsimile or any other customary means of communication, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: if to Lessee, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 733-1657 if to Owner Trustee, addressed to: Wells Fargo Bank Northwest, National Association 79 South Main Street Salt Lake City, Utah 84111 Attention: Corporate Trust Division Telephone: (___) ___-____ Facsimile: (801) 246-5053 if to Owner Participant, addressed to: [Address] Attention: [____________] Telephone: (___) ___-____ Facsimile: (___) ___-____ if to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee, addressed to: State Street Bank And Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Facsimile: (860) 244-1881 or if to any subsequent Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 of the Indenture. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 16.01. Section 16.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements. Except as otherwise provided herein, the representations, warranties, indemnities, covenants and agreements of Lessee, State Street, Loan Trustee, Subordination Agent, Owner Participant, Owner Trustee, each Pass Through Trustee and Noteholders herein, and each of their obligations hereunder, shall survive the making available of the respective Commitments by Pass Through Trustee and Owner Participant, the delivery or return of the Aircraft, the transfer of any interest of Owner Participant in the Trust Estate or the Aircraft or any Engine or the transfer of any interest by any Noteholder in any Equipment Note or the Indenture Estate and the expiration or termination (to the extent arising out of acts or events occurring prior to such expiration) of any Operative Documents. Section 16.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 16.04 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 hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 16.05 No Oral Modifications or Continuing Waivers; Consents. Subject to Section 9.01 of the Indenture, 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 against which the enforcement of the change, waiver, discharge or termination is sought. No such change, waiver, discharge or termination shall be effective unless a signed copy thereof is delivered to Loan Trustee. Each Pass Through Trustee and, by its acceptance of an Equipment Note, each subsequent Noteholder covenants and agrees that it shall not unreasonably withhold its consent to any consent of Loan Trustee requested by Lessee under the Indenture. Section 16.06 Effect of Headings and Table of Contents. The headings of the various Articles and Sections herein and in the Table of Contents are for convenience of reference only and do not define or limit any of the terms or provisions hereof. Section 16.07 Successors and Assigns. All covenants, agreements, representations and warranties in this Agreement by Lessee, by State Street, individually or as Loan Trustee, Subordination Agent or Pass Through Trustee, by Owner Trustee (in its individual capacity or as trustee), by Owner Participant, or by any Noteholder, shall bind and inure to the benefit of and be enforceable by Lessee, and subject to the terms of Subsection 6.02(e), its successors and permitted assigns, each Pass Through Trustee and any successor or other trustee under the Pass Through Trust Agreement to which it is a party, Subordination Agent and its successor under the Intercreditor Agreement, Loan Trustee and its successor under the Indenture, Owner Participant and, subject to the terms of the Trust Agreement, its successors and permitted assigns, and Owner Trustee and its successors as Owner Trustee under the Trust Agreement, whether so expressed or not. Section 16.08 Benefits of Agreement. Nothing in this Agreement, express or implied, gives to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy or claim under this Agreement, except as expressly provided herein. Lessee agrees and acknowledges that Liquidity Provider and Policy Provider shall be third party beneficiaries of the indemnities contained in Section 4.03 and may rely on such indemnities to the same extent as if such indemnities were made to Liquidity Provider and Policy Provider directly. Section 16.09 Counterparts. This Agreement may be executed in any number of counterparts. Each of the parties hereto shall not be required to execute the same counterpart. Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts shall together constitute one instrument. Section 16.10 Submission to Jurisdiction. Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Documents hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the Lease, the Tax Indemnity Agreement or any other Operative Document, the subject matter hereof or thereof or any of the transactions contemplated hereby or thereby brought by any party or parties hereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement, the Lease, the Tax Indemnity Agreement or any other Operative Document or the subject matter hereof or thereof or any of the transactions contemplated hereby or thereby may not be enforced in or by such courts. Section 16.11 Obligations of Owner Trustee. The parties hereto agree that all of the statements, representations, covenants and agreements made by Owner Trustee (when made in such capacity) contained in this Agreement and any agreement referred to herein other than the Trust Agreement, unless otherwise expressly stated, are made and intended only for the purpose of binding the Trust Estate and establishing the existence of rights and remedies which can be exercised and enforced against the Trust Estate. Therefore, anything contained in this Agreement or such other agreements to the contrary notwithstanding (except for any express provisions that Owner Trustee is responsible for in its individual capacity), no recourse shall be had with respect to this Agreement or such other agreements against Owner Trustee in its individual capacity or against any institution or person which becomes a successor trustee or co-trustee or any officer, director, trustee, servant or direct or indirect parent or controlling person or persons of any of them; provided, however, that this Section 16.11 shall not be construed to prohibit any action or proceeding against any party hereto for its own willful misconduct or grossly negligent conduct for which it would otherwise be liable; and provided, further, that nothing contained in this Section 16.11 shall be construed to limit the exercise and enforcement in accordance with the terms of this Agreement or such other agreements of rights and remedies against the Trust Estate. The foregoing provisions of this Section 16.11 shall survive the termination of this Agreement and the other Operative Documents. Section 16.12 Payments to Owner Participant. Payments to be made to Owner Participant as provided in Section 3.06 of the Indenture shall be made to: [Bank] ABA No. Account No. Account Name: Reference: Section 16.13 Section 1110. It is the intention of the parties hereto that Owner Trustee, as Lessor under the Lease, and Loan Trustee, as assignee of such Owner Trustee's rights under the Lease pursuant to the Indenture, will be entitled to the benefits of Section 1110 in any case in which Lessee is a debtor under Chapter 11 of the Bankruptcy Code. IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Participation Agreement to be duly executed by their respective officers thereunto duly authorized as of the date first above written. DELTA AIR LINES, INC. By: -------------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements By: -------------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By: -------------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By: -------------------------------------- Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein By: -------------------------------------- Name: Title: [___________________________________], as Owner Participant By: -------------------------------------- Name: Title: WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as otherwise provided herein, but solely as Owner Trustee By: -------------------------------------- Name: Title: SCHEDULE I to PARTICIPATION AGREEMENT COMMITMENTS Unpaid Interest Rate and Principal Percentage of Purchaser Maturity Amount Lessor's Cost - ------------------ --------------------- -------------- ----------------- Delta Air Lines 6.718% Series G-1 Pass Through Equipment Notes Trust 2002-1G-1 due [_______ , $[__________] [________]% 20__] Delta Air Lines 6.417% Series G-2 Pass Through Equipment Notes Trust 2002-1G-2 due July 2, 2012 $[__________] [________]% Delta Air Lines 7.779% Series C Pass Through Equipment Notes Trust 2002-1C due [_______ , $[__________] [________]% 20__] Owner Participant Equity Investment [_________] $[__________] [________]% Total Commitments: $[________] SCHEDULE II to PARTICIPATION AGREEMENT TRUST SUPPLEMENTS Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, between Lessee and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-1. Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, between Lessee and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-2. Trust Supplement No. 2002-1C, dated as of April 30, 2002, between Lessee and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1C. EXHIBIT A-1 to PARTICIPATION AGREEMENT FORM OF OPINION OF COUNSEL FOR LESSEE [Intentionally Omitted] EXHIBIT A-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LESSEE [Intentionally Omitted] EXHIBIT A-3 to PARTICIPATION AGREEMENT FORM OF ss. 1110 OPINION OF SPECIAL COUNSEL FOR LESSEE [Intentionally Omitted] EXHIBIT B to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LOAN TRUSTEE, SUBORDINATION AGENT AND STATE STREET [Intentionally Omitted] EXHIBIT C to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL FAA COUNSEL [Intentionally Omitted] EXHIBIT D to PARTICIPATION AGREEMENT FORM OF OPINION OF RAY, QUINNEY AND NEBEKER, SPECIAL COUNSEL FOR OWNER TRUSTEE [Intentionally Omitted] EXHIBIT E-1 to PARTICIPATION AGREEMENT FORM OF OPINION OF [________________], SPECIAL COUNSEL FOR OWNER PARTICIPANT [Intentionally Omitted] EXHIBIT E-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF IN-HOUSE COUNSEL FOR OWNER PARTICIPANT [Intentionally Omitted] EXHIBIT F to PARTICIPATION AGREEMENT FORM OF OPINION OF COUNSEL FOR MANUFACTURER [Intentionally Omitted] EXHIBIT G to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR PASS THROUGH TRUSTEES [Intentionally Omitted] EXHIBIT I to PARTICIPATION AGREEMENT SCHEDULE OF COUNTRIES Argentina Grenada Norway Australia Guatemala Paraguay Austria Hungary Peoples' Republic of China Bahamas Iceland Philippines Barbados India Poland Belgium Indonesia Portugal Bermuda Islands Ireland Republic of China (Taiwan) Brazil Italy Singapore British Virgin Islands Jamaica South Africa Canada Japan South Korea Cayman Islands Kuwait Spain Chile Liechtenstein Sweden Czech Republic Luxembourg Switzerland Denmark Malta Thailand Ecuador Mexico Trinidad and Tobago Egypt Monaco United Kingdom Finland Morocco Uruguay France Netherlands Antilles Venezuela Germany Netherlands, the Greece New Zealand EXHIBIT J to PARTICIPATION AGREEMENT RETURN CONDITIONS Unless purchased by Lessee pursuant to Section 19 of the Lease, at the time of return of the Airframe upon the expiration of the Lease at the end of the Basic Term or any Renewal Term or upon the termination of the Lease pursuant to Section 9(c) or 15 of the Lease: 1. Airworthiness Directives. Those Airworthiness Directives of the FAA (if the Aircraft is then registered under the laws of the United States) or the applicable aviation authority of the country of registry of the Aircraft (if the Aircraft is then registered under the laws of any jurisdiction other than the United States) applicable to the Aircraft which require terminating action within thirty (30) days after the end of the Term shall have been accomplished. 2. Scheduled Maintenance - Airframe. The Airframe shall have not less than 1500 hours remaining until the next scheduled "C" Check, based on the maintenance program applicable to the Airframe at the time of return. 3. Scheduled Maintenance - Engines. Regardless of whether the maintenance program applicable to the Engines at the time of return is an "on-condition" maintenance program or not, the Engines in the aggregate shall have at least 2,000 cycles remaining with no Engine having any life-limited part with less than 1,000 cycles remaining to the next required life limited part removal. 4. Deferred Maintenance. There shall be no open, outstanding or deferred maintenance items, scheduled or unscheduled, against the Aircraft, including those identified in pre-delivery inspections. 5. Manuals. The Aircraft Flight Manual, Flight Crew Operating Manual, and the Quick Reference Handbook specific to the Aircraft shall be delivered with the Aircraft. 6. General Appearance. The Aircraft shall be clean by U.S. airline standards. 7. Equivalency Charge. If the Engines do not meet the condition set forth in paragraph 3 above, then Lessee shall pay an Equivalency Charge for the Engines in accordance with the following formula. This formula shall be calculated individually for each life-limited part (LLP) for each Engine: Pmt = X* (1,000 - LLPx) WHERE: "Pmt" is the Equivalency Charge payment. Such payment will be the sum of all calculations for both Engines; "X" is 100% of the then-current manufacturers list price for each LLP which has fewer than 1,000 cycles remaining. If Lessee has in place negotiated pricing which is less than the manufacturers list price, then "X" shall be Lessee's negotiated price; LLPx is the actual number of engine cycles remaining on a particular LLP at the time of return. If the Airframe does not meet the conditions set forth in paragraph 2 above, then Lessee shall pay an Equivalency Charge calculated in accordance with the following formula: Pmt = A * ( b-c ) ------- d WHERE: "Pmt" is the Equivalency Charge payment; "A" is the then current estimated cost of the next scheduled C Check inspection (provided, that, if under the then-current maintenance program applicable to the Aircraft the C Check is performed in phases, "A" shall equal zero); "b" is 1,500 hours "c" is the actual number of operating hours remaining to the next scheduled C Check inspection; "d" is the total operating hours allowable between such C Check inspections. All Equivalency Charges, if any, shall be payable as Supplemental Rent and shall be due within thirty (30) days after presentation to Lessee of an invoice setting forth in reasonable detail the calculation of such amounts due. Unless both Lessor and Lessee agree, the then-current estimated cost of the next maintenance action or restriction will be the cost quoted by an FAA-approved maintenance facility chosen by Lessee and reasonably acceptable to Lessor. The results of the computation of the Equivalency Charges for the Engines and the Airframe shall be netted so that only one consolidated payment is required. If the result of the computation and netting is a negative number, then (except in the case of a return in connection with an Event of Default, in which case no payment by Lessor shall be required) Lessor shall pay such amount to Lessee upon return of the Aircraft and Lessee's satisfaction of all of its obligations hereunder. 8. Special Markings. Upon termination, cancellation, or expiration of the Lease, Lessee shall, at its cost, paint over or remove from the exterior of the Aircraft all insignias; provided, that the registration number shall not be removed from the Aircraft. This provision will not require Lessee to strip or repaint the Aircraft. Annex A to Amended and Restated Participation Agreement, Lease and Amended and Restated Indenture and Security Agreement (N[_____]) DEFINITIONS (N[_____]) "Actual Knowledge" means, (i) as it applies to Owner Trustee or Loan Trustee, as the case may be, actual knowledge of a Responsible Officer in the Trust Office of Owner Trustee or in the Corporate Trust Office of Loan Trustee, as the case may be, and (ii) as it applies to Owner Participant, actual knowledge of a vice president or other higher officer of Owner Participant having responsibility for the transactions contemplated by the Operative Documents. "Additional Insureds" has the meaning specified in Section 11(a) of the Lease. "After-Tax Basis" means that indemnity and compensation payments required to be made on such basis will be supplemented by the Person paying the base amount by that amount which, when added to such base amount, and after deduction of all Federal, state, local and foreign Taxes required to be paid by or on behalf of the payee with respect of the receipt or realization of any such amounts, and after consideration of any current tax savings of such payee resulting by way of any deduction, credit or other tax benefit attributable to such base amount or Tax, shall net such payee the full amount of such base amount. "Agreement" and "Participation Agreement" mean that certain Amended and Restated Participation Agreement (N[_____]), dated as of [_________ __, 200_], among Lessee, State Street, Pass Through Trustee under each Pass Through Trust Agreement, Subordination Agent, Loan Trustee, Owner Participant and Owner Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, which Amended and Restated Participation Agreement amended and restated in its entirety the Original Participation Agreement. "Aircraft" means the Airframe (or any Replacement Airframe substituted therefor pursuant to Section 10(a) of the Lease) together with the two Engines described in the initial Lease Supplement (or any Replacement Engine that may from time to time be substituted for any of such Engines pursuant to Section 5(b), Section 9(c) or Section 10(b) of the Lease), whether or not any of such initial or substituted Engines is from time to time installed on such Airframe or installed on any other airframe or on any other aircraft. The term "Aircraft" includes any Replacement Aircraft. "Airframe" means (a) the Boeing 737-832 aircraft (except (i) the Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (ii) items installed or incorporated in or attached to such Boeing 737-832 aircraft from time to time that are excluded from the definition of Parts (except Engines or engines)) specified in the initial Lease Supplement and (b) any and all related Parts. The term "Airframe" includes any Replacement Airframe that is substituted for the Airframe pursuant to Section 10(a) of the Lease. At such time as any Replacement Airframe is so substituted, such replaced Airframe shall cease to be an Airframe under the Lease. "Amended and Restated Indenture" means the Amended and Restated Indenture and Security Agreement (N[_____]), dated as of [__________ __, 200_], between Owner Trustee and Loan Trustee. "Assumed Equipment Notes" means the equipment notes dated the Delivery Date to be issued by Owner Trustee pursuant to the Amended and Restated Indenture on the Delivery Date to Subordination Agent on behalf of Pass Through Trustees. "Bankruptcy Code" means the United States Bankruptcy Code, 11 United States Code ss.ss.101 et seq., as amended, or any successor statutes thereto. "Base Rate" means the rate of interest announced publicly by Citibank, N.A. in New York, New York from time to time as its base rate. "Basic Pass Through Trust Agreement" means that certain Pass Through Trust Agreement, dated as of November 16, 2000, between Company and State Street, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms (but does not include any Trust Supplement). "Basic Rent" means, for the Basic Term, but subject always to the provisions of Section 3(c)(iv) of the Lease, the rent payable for the Aircraft pursuant to Section 3(b) of the Lease as adjusted as provided in Section 3(c) of the Lease and, for any Renewal Term, Basic Rent determined pursuant to Section 19 of the Lease. "Basic Term" means the term for which the Aircraft is leased under the Lease pursuant to Section 3(a) thereof commencing on the Delivery Date and ending on [__________ __, 20__], or such earlier date as the Lease is terminated in accordance with the provisions thereof. "Beneficial Interest" means the interest of Owner Participant under the Trust Agreement. "Bill of Sale" means a full warranty bill of sale covering the Aircraft, executed by Lessee in favor of Owner Trustee, dated the Delivery Date, specifically referring to the Airframe and each Engine, which Bill of Sale shall contain, among other things, a statement that such Bill of Sale thereby conveys to Owner Trustee good title to the Airframe and each Engine described in such Bill of Sale, free and clear of all liens, encumbrances and rights of others except the Lien of the Original Indenture and Liens permitted by clause (v) of Section 6 of the Lease. "Business Day" means any day other than a Saturday, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia or the city and state in which Loan Trustee maintains its Corporate Trust Office or receives and disburses funds. "Certificated Air Carrier" means a Citizen of the United States holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the United States Code for aircraft capable of carrying ten or more individuals or 6,000 pounds or more of cargo or that otherwise is certified or registered to the extent required to fall within the purview of Section 1110. "Citizen of the United States" has the meaning specified for such term in Section 40102(a)(15) of Title 49 of the United States Code or any similar legislation of the United States enacted in substitution or replacement therefor. "Claim" has the meaning specified in Section 4.03(a) of the Participation Agreement. "Class C Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1C-1 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1C-1, dated as of April 30, 2002 between Lessee and State Street. "Class G-1 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-1 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Lessee and State Street. "Class G-1 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Lessee and State Street. "Class G-2 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-2 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Lessee and State Street. "Class G-2 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Lessee and State Street. "Closing" has the meaning specified in Section 2.04 of the Participation Agreement. "Code" means the Internal Revenue Code of 1986, as amended. "Commitment" has the meaning specified in Section 2.03 of the Participation Agreement. "Compulsory Acquisition" means requisition of title or other compulsory acquisition, capture, seizure, deprivation, confiscation or detention for any reason of the Aircraft by any government that results in the loss of title or use of the Aircraft by Lessee (or any Permitted Sublessee) for a period in excess of 180 days, but shall exclude requisition for use or hire not involving requisition of title. "Confidential Information" has the meaning specified in Section 6.01(i) of the Participation Agreement. "Continuous Stay Period" has the meaning specified in Section 4.04(a) of the Indenture. "Controlling Party" has the meaning specified in Section 2.06 of the Intercreditor Agreement. "Corporate Trust Department" or "Trust Office" means the principal corporate trust office of Owner Trustee at MAC: U1254-031, 79 South Main Street, Salt Lake City, Utah 84111, Attention: Corporate Trust Department, or such other office at which Owner Trustee's corporate trust business is administered which Owner Trustee specifies by notice to Lessee, Loan Trustee and Owner Participant. "Corporate Trust Office" means the Corporate Trust Division of Loan Trustee located at State Street Bank and Trust Company of Connecticut, National Association, 225 Asylum Street, Goodwin Square, Hartford, Connecticut, 06103, Attention: Corporate Trust Division, or such other office at which Loan Trustee's corporate trust business is administered that Loan Trustee specifies by notice to Lessee and Owner Trustee. "CRAF Program" means the Civil Reserve Air Fleet Program authorized under 10 U.S.C. Section 9511 et seq. or any similar or substitute program under the laws of the United States. "Debt" means any liability for borrowed money, or any liability for the payment of money in connection with any letter of credit transaction, or other liabilities evidenced or to be evidenced by bonds, debentures, notes or other similar instruments or for the deferred purchase price of property, goods or services. "Debt Rate" means, with respect to any Series, the rate per annum specified for such Series under the heading "Interest Rate" in Schedule I to the Indenture. "Default", when used in the Indenture, means any event or condition that with the giving of notice or the lapse of time or both would become an Indenture Event of Default or Lease Event of Default (excluding Lease Events of Default related to Excluded Payments). "Delivery Date" means the date of the initial Lease Supplement for the Aircraft, which date shall be the date the Aircraft is leased by Lessor to Lessee and accepted by Lessee under the Lease. "Department of Transportation" means the United States Department of Transportation and any agency or instrumentality of the United States government succeeding to its functions. "Direction" has the meaning specified in Section 2.16 of the Indenture. "Dollars" and "$" mean the lawful currency of the United States. "EBO Date" means [___________ __, ____] (or, if [___________ __, ____] is not a Business Day, the Business Day immediately succeeding [___________ __, ____]). "Enforcement Date" has the meaning specified in Section 4.03 of the Indenture. "Engine" means (a) each of the two CFM International, Inc. CFM56-7B26 engines, which may be rated at or limited to -24 or higher power, listed by manufacturer's serial number in the initial Lease Supplement, whether or not from time to time installed on the Airframe or installed on any other airframe or on any other aircraft and (b) any Replacement Engine substituted for an Engine pursuant to Section 5(b), Section 9(c) or Section 10(b) of the Lease; together in each case with any and all related Parts. At such time as a Replacement Engine is so substituted, such replaced Engine shall cease to be an Engine under the Lease. "Equipment Note" means and includes any Equipment Note originally issued pursuant to Section 2.02 of the Indenture and any Equipment Note issued in exchange therefor or replacement thereof pursuant to Section 2.07 or 2.08 of the Indenture. "Equipment Note Register" has the meaning specified in Section 2.07 of the Indenture. "Equipment Note Registrar" has the meaning specified in Section 2.07 of the Indenture. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA as in effect at the date of the Participation Agreement and any subsequent provisions of ERISA amendatory thereof, supplemental thereto or substituted therefor. "Event of Default" or "Lease Event of Default" has the meaning specified for "Event of Default" in Section 14 of the Lease. "Event of Loss" means, with respect to the Aircraft, Airframe or any Engine, any of the following events with respect to such property: (a) the loss of such property or of the use thereof due to destruction, damage beyond repair or rendition of such property permanently unfit for normal use for any reason whatsoever; (b) any damage to such property which results in an insurance settlement with respect to such property on the basis of a total loss, a compromised total loss or a constructive total loss; (c) the theft or disappearance of such property for a period in excess of 180 days; (d) the requisition for use of such property by any government (other than a requisition for use by a Government or the government of the country of registry of the Aircraft) that results in the loss of possession of such property by Lessee (or any Permitted Sublessee) for a period in excess of 12 consecutive months or, if earlier, 30 days beyond the Term, provided, however, that no Event of Loss pursuant to this clause (d) shall exist if Lessor has furnished to Lessee the notice specified in Section 10(d) of the Lease; (e) the operation or location of the Aircraft, while under requisition for use by any government, in any area excluded from coverage by any insurance policy in effect with respect to the Aircraft required by the terms of Section 11 of the Lease, unless Lessee shall have obtained indemnity or insurance in lieu thereof from such government; (f) any Compulsory Acquisition; (g) as a result of any law, rule, regulation, order or other action by the FAA or other government of the country of registry, the use of the Aircraft or Airframe in the normal business of air transportation is prohibited by virtue of a condition affecting all aircraft of the same type for a period of 18 consecutive months, unless Lessee is diligently carrying forward all steps that are necessary or desirable to permit the normal use of the Aircraft or Airframe or, in any event, if such use is prohibited for a period of three consecutive years or if such use is prohibited at the end of the Term; (h) the requisition for use of such property by a Government or the country of registry of the Aircraft which shall occur during the Basic Term (or any Renewal Term) and shall continue for 30 days beyond the Term, provided, however, that no Event of Loss pursuant to this clause (h) shall exist if Lessor has furnished to Lessee the notice specified in Section 10(d) of the Lease; and (i) with respect to an Engine only, any divestiture of title to or interest in an Engine or any event with respect to an Engine that is deemed to be an Event of Loss with respect to such Engine pursuant to Section 7(a)(vii) of the Lease. An Event of Loss with respect to the Aircraft shall be deemed to have occurred if an Event of Loss occurs with respect to the Airframe unless Lessee elects to substitute a Replacement Airframe pursuant to Section 10(a)(i) of the Lease. "Excess Amount", when used in the Participation Agreement, has the meaning specified in Section 11.01 of the Participation Agreement and, when used in the Indenture, has the meaning specified in Section 2.18(b) of the Indenture. "Excluded Payments" means (i) indemnity payments paid or payable by Lessee to or in respect of Owner Participant or Owner Trustee in its individual capacity, their respective affiliates, successors and permitted assigns and their directors, officers, employees, servants and agents (collectively, the "Owner Indemnitees") pursuant to Sections 4.02 and 4.03 of the Participation Agreement, (ii) proceeds of public liability insurance in respect of the Aircraft payable as a result of insurance claims made, or losses suffered, by Owner Trustee or Loan Trustee in their respective individual capacities or by any of Owner Indemnitees, (iii) proceeds of insurance maintained with respect to the Aircraft by Owner Participant (whether directly or through Owner Trustee) or any other Owner Indemnitee and permitted under Section 11(f) of the Lease, (iv) all payments required to be made under the Tax Indemnity Agreement by Lessee and all payments of Supplemental Rent by Lessee in respect of any amounts payable under the Tax Indemnity Agreement, (v) fees payable to Owner Trustee or Loan Trustee pursuant to the last sentence of Section 4.03(c) of the Participation Agreement, (vi) provided that the Equipment Notes have been duly assumed by Lessee pursuant to Section 2.17 of the Indenture, the amounts payable to Owner Trustee pursuant to the third sentence of Section 19(d) of the Lease plus all reasonable expenses incurred by Owner Trustee and Owner Participant in connection with such assumption, as applicable, (vii) interest accrued on any of the above, and (viii) any right to enforce the payment of any amount described in clauses (i) through (vii) above and the right to declare an Event of Default in respect of any of the foregoing amounts. "FAA" means the United States Federal Aviation Administration and any agency or instrumentality of the United States government succeeding to its functions. "FAA Bill of Sale" means the bill of sale for the Aircraft on AC Form 8050-2 or such other form as may be approved by the FAA on the Delivery Date, executed by Lessee in favor of Owner Trustee and dated the Delivery Date. "Fair Market Renewal Term" has the meaning specified in Section 19(a)(2) of the Lease. "Federal Funds Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 State Street from three Federal funds brokers of recognized standing selected by it. "Fixed Renewal Term" has the meaning specified in Section 19(a)(1) of the Lease. "Government" means the government of any of Canada, France, Germany, Japan, The Netherlands, Sweden, Switzerland, the United Kingdom or the United States and any instrumentality or agency thereof. "Indemnitee" has the meaning specified in Section 4.03(b) of the Participation Agreement. "Indenture" means the Original Indenture as assumed, amended and restated pursuant to the Amended and Restated Indenture, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, including supplementing by an Indenture Supplement pursuant thereto. "Indenture Agreements" means the Participation Agreement, the Lease, the Purchase Agreement, the Purchase Agreement Assignment, the Manufacturer's Consent, the Bill of Sale and any other contract, agreement or instrument from time to time assigned or pledged under the Indenture. "Indenture Default" means an event or a condition that would constitute an Indenture Event of Default with the passage of time or notice or both. "Indenture Estate" means all estate, right, title and interest of Loan Trustee in and to the properties referred to in the Granting Clause of the Indenture, excluding Excluded Payments. "Indenture Event of Default" has the meaning specified in Section 4.02 of the Indenture. "Indenture Indemnitee" means (i) Loan Trustee, (ii) State Street, (iii) so long as it holds any Equipment Note as agent and trustee of any Pass Through Trustee, Subordination Agent, (iv) Liquidity Provider and Policy Provider and (v) so long as it is the holder of any Equipment Notes, each Pass Through Trustee and each of their respective directors, officers, employees, agents and servants. No holder of a Pass Through Certificate in its capacity as such shall be an Indenture Indemnitee. "Indenture Supplement" means a supplement to the Indenture, substantially in the form of Exhibit A to the Indenture, which particularly describes the Aircraft, and any Replacement Airframe and or Replacement Engine included in the property subject to the Lien of the Indenture. ["Initial Installment" has the meaning specified in Section 19(d) of the Lease.] "Intercreditor Agreement" means that certain Intercreditor Agreement, dated as of April 30, 2002, among Pass Through Trustees, Liquidity Provider, Policy Provider and Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interests" has the meaning specified in Section 11(a) of the Lease. "Lease" or "Lease Agreement" means that certain Lease Agreement (N[_____]), dated as of [___________, ____], between Lessor and Lessee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms and in accordance with the Indenture, including, without limitation, supplementation thereof by one or more Lease Supplements entered into pursuant to the applicable provisions thereof. "Lease Default" means any event which with the giving of notice or the lapse of time or both would become an Event of Default. "Lease Event of Default" has the meaning set forth under the definition of "Event of Default". "Lease Period" means each of the consecutive periods throughout the Basic Term and any Renewal Term ending on a Lease Period Date, the first such period commencing on and including the Delivery Date. "Lease Period Date" means [___________, ____] and each succeeding January 2 and July 2, to and including the last such date in the Term. "Lease Supplement" means a Lease Supplement, substantially in the form of Exhibit A to the Lease, to be entered into between Lessor and Lessee on the Delivery Date for the purpose of leasing the Aircraft under and pursuant to the terms of the Lease, and any subsequent Lease Supplement entered into in accordance with the terms of the Lease. "Lessee" means Delta Air Lines, Inc., a Delaware corporation, and its successors and permitted assigns. "Lessor" means Owner Trustee. "Lessor Liens" means any Lien or disposition of title or interest arising as a result of (i) claims against Lessor, Wells Fargo Bank Northwest, National Association, in its individual capacity, or Owner Participant not related to the transactions contemplated by the Operative Documents, (ii) any act or omission of Owner Participant, Lessor, or Wells Fargo Bank Northwest, National Association, in its individual capacity, which is not related to the transactions contemplated by the Operative Documents or is in violation of any of the terms of the Operative Documents, (iii) claims against Owner Participant, Lessor, or Wells Fargo Bank Northwest, National Association, in its individual capacity, with respect to Taxes or Claims against which Lessee is not required to indemnify Owner Participant, Lessor or Wells Fargo Bank Northwest, National Association, in its individual capacity, pursuant to Section 4.02 and Section 4.03 of the Participation Agreement or (iv) claims against Lessor or Owner Participant arising out of any transfer by Lessor or Owner Participant of all or any portion of the respective interests of Lessor or Owner Participant in the Aircraft, the Trust Estate or the Operative Documents other than the transfer of possession of the Aircraft by Lessor pursuant to the Lease, the transfer pursuant to the Indenture or a transfer of the Aircraft pursuant to Section 9, 10 or 19 of the Lease or pursuant to the exercise of the remedies set forth in Section 15 of the Lease, provided, however, that any Lien which is attributable solely to Wells Fargo Bank Northwest, National Association or Owner Participant and would otherwise constitute a Lessor Lien hereunder shall not constitute a Lessor Lien hereunder so long as (1) the existence of such Lien poses no material risk of the sale, forfeiture or loss of the Aircraft, (2) the existence of such Lien does not interfere in any way with the use, possession, operation, or quiet enjoyment of the Aircraft by Lessee (or any Permitted Sublessee), (3) the existence of such Lien does not affect the priority or perfection of, or otherwise jeopardize, the Lien of the Indenture, (4) Wells Fargo Bank Northwest, National Association or Owner Participant, as appropriate, is diligently contesting such Lien and (5) the existence of such Lien does not pose a material threat of interference with the payment of Rent (other than Excluded Payments in favor of Wells Fargo Bank Northwest, National Association or Owner Participant, as appropriate). "Lessor's Cost" for the Aircraft means the amount denominated as such in Exhibit B-1 to the Lease. "Lien" means any mortgage, pledge, lien, encumbrance, lease, sublease, sub-sublease or security interest. "Liquidity Facilities" means the three Revolving Credit Agreements, each dated as of April 30, 2002, between Subordination Agent, as borrower, and Liquidity Provider, and any replacements thereof, in each case as the same may be amended or supplemented or otherwise modified from time to time in accordance with its terms. "Liquidity Provider" means Westdeutsche Landesbank Girozentrale, a German banking institution organized under the laws of the State of North Rhine-Westphalia, acting through its New York branch, as liquidity provider under each of the Liquidity Facilities, or any liquidity provider under a replacement liquidity facility. "Loan Trustee" has the meaning specified in the introductory paragraph of the Indenture. "Loan Trustee Event" means either (i) the Equipment Notes have become due and payable pursuant to Section 4.04(b) of the Indenture or (ii) Loan Trustee has taken action or notified Owner Trustee that it intends to take action to foreclose the Lien of the Indenture or otherwise commence the exercise of any significant remedy under the Indenture or the Lease. "Loan Trustee Liens" means any Lien attributable to State Street or Loan Trustee with respect to the Aircraft, any interest therein or any other portion of the Indenture Estate arising as a result of (i) claims against State Street or Loan Trustee not related to its interest in the Aircraft or the administration of the Indenture Estate pursuant to the Indenture, (ii) acts of State Street or Loan Trustee not permitted by, or the failure of State Street or Loan Trustee to take any action required by the Operative Documents or the Pass Through Documents, (iii) claims against State Street or Loan Trustee relating to Taxes or Claims that are excluded from the indemnification provided by Section 4.02 and Section 4.03 of the Participation Agreement pursuant thereto or (iv) claims against State Street or Loan Trustee arising out of the transfer by any such party of all or any portion of its interest in the Aircraft, the Indenture Estate, the Operative Documents or the Pass Through Documents, except a transfer of the Aircraft pursuant to Section 9, 10 or 19 of the Lease or Article IV or V of the Indenture, or a transfer of the Aircraft pursuant to Section 15 of the Lease while an Event of Default is continuing and prior to the time that Loan Trustee has received all amounts due to it pursuant to the Indenture. "Loss Payment Date" has the meaning specified in Section 10(a) of the Lease. "Majority in Interest of Noteholders" means, as of a particular date of determination and subject to Section 2.16 of the Indenture, the holders of at least a majority in aggregate unpaid principal amount of all Equipment Notes outstanding as of such date (excluding any Equipment Notes held by Owner Trustee or Owner Participant or any interests of Owner Participant therein by reason of subrogation pursuant to Section 4.03 of the Indenture (unless all Equipment Notes then outstanding are held by Owner Trustee or Owner Participant) or Lessee or any affiliate of any thereof). "Make-Whole Amount" means, with respect to any Equipment Note, the amount (as determined by an independent investment banker selected by Lessee (and, following the occurrence and during the continuance of an Event of Default, reasonably acceptable to Loan Trustee and Owner Participant)), if any, by which (i) the present value of the remaining scheduled payments of principal and interest from the redemption date to maturity of such Equipment Note computed by discounting each such payment on a semiannual basis from its respective Payment Date (assuming a 360-day year of twelve 30 day months) using a discount rate equal to the Treasury Yield exceeds (ii) the outstanding principal amount of such Equipment Note plus accrued but unpaid interest thereon. For purposes of determining the Make-Whole Amount, "Treasury Yield" means, at the date of determination, the interest rate (expressed as a semiannual equivalent and as a decimal and, in the case of United States Treasury bills, converted to a bond equivalent yield) determined to be the per annum rate equal to the semiannual yield to maturity for United States Treasury securities maturing on the Average Life Date and trading in the public securities market either as determined by interpolation between the most recent weekly average yield to maturity for two series of United States Treasury securities, trading in the public securities markets, (A) one maturing as close as possible to, but earlier than, the Average Life Date and (B) the other maturing as close as possible to, but later than, the Average Life Date, in each case as published in the most recent H.15(519) or, if a weekly average yield to maturity for United States Treasury securities maturing on the Average Life Date is reported on the most recent H.15(519), such weekly average yield to maturity as published in such H.15(519). "H.15(519)" means the weekly statistical release designated as such, or any successor publication, published by the Board of Governors of the Federal Reserve System. The date of determination of a Make-Whole Amount shall be the third Business Day prior to the applicable redemption date and the "most recent H.15(519)" means the H.15(519) published prior to the close of business on the third Business Day prior to the applicable redemption date. "Average Life Date" means, for each Equipment Note to be redeemed, the date which follows the redemption date by a period equal to the Remaining Weighted Average Life at the redemption date of such Equipment Note. "Remaining Weighted Average Life" of an Equipment Note, at the redemption date of such Equipment Note, means the number of days equal to the quotient obtained by dividing: (i) the sum of the products obtained by multiplying (A) the amount of each then remaining installment of principal, including the payment due on the maturity date of such Equipment Note, by (B) the number of days from and including the redemption date to but excluding the scheduled payment date of such principal installment by (ii) the then unpaid principal amount of such Equipment Note. "Manufacturer" means The Boeing Company, a Delaware corporation, and its successors and assigns. "Manufacturer's Consent" means the Manufacturer's Consent and Agreement to Assignment of Warranties, dated as of the Delivery Date, executed by Manufacturer, as the same may be amended, modified or supplemented from time to time in accordance with its terms. "Net Economic Return" has the meaning specified in paragraph 2 of Exhibit E to the Lease. "Net Present Value of Rents" means the net present value, as of the Delivery Date, of Basic Rent set forth in Exhibit B-1 to the Lease, discounted at an annual rate of 8 percent on a semi-annual basis. "Noteholder" means any Person in whose name an Equipment Note is registered on the Equipment Note Register (including, for so long as it is the registered holder of any Equipment Notes, Subordination Agent on behalf of Pass Through Trustees pursuant to the provisions of the Intercreditor Agreement). "Noteholder Liens" means any Lien attributable to any Noteholder on or against the Aircraft, any interest herein or any portion of the Collateral, arising out of any claim against such Noteholder that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such Noteholder that is not related to the transactions contemplated by, or that constitutes a breach by such Noteholder of its obligations under, the Operative Documents or the Pass Through Documents. "Operative Documents" means, collectively, the Participation Agreement, the Lease, the Lease Supplement covering the Aircraft, the Indenture, the Indenture Supplement covering the Aircraft, the Trust Agreement, the Tax Indemnity Agreement, the Bill of Sale, the FAA Bill of Sale, the Purchase Agreement Assignment, the Manufacturer's Consent and the Equipment Notes. "Original Closing Date" means April 30, 2002. "Original Documents" means the Original Participation Agreement, the Original Indenture and the Original Equipment Notes. "Original Equipment Notes" means the equipment notes, dated April 30, 2002, issued by Lessee pursuant to the Original Indenture on the Original Closing Date to Subordination Agent on behalf of Pass Through Trustee for each of the Pass Through Trusts. "Original Indenture" means the Indenture and Security Agreement (N[_____]), dated as of April 30, 2002, between Lessee and Loan Trustee, as such Indenture and Security Agreement may have been amended or supplemented from time to time pursuant to the applicable provisions thereof prior to the execution and delivery of the Amended and Restated Indenture. "Original Participation Agreement" means that certain Participation Agreement (N[_____]), dated as of April 30, 2002, among Lessee, Pass Through Trustees, Loan Trustee and Subordination Agent, as such Participation Agreement may have been amended or supplemented from time to time pursuant to the applicable provisions thereof prior to the execution and delivery of the Participation Agreement. "Other Party Liens" means any Lien attributable to Pass Through Trustee (other than in its capacity as Noteholder), Subordination Agent (other than in its capacity as Noteholder), Liquidity Provider or Policy Provider on or against the Aircraft, any interest therein, or any portion of the Collateral arising out of any claim against such party that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such party that is not related to the transactions contemplated by, or that constitutes a breach by such party of its obligations under, the Operative Documents or the Pass Through Documents. "Overall Transaction" means all the transactions contemplated by the Operative Documents. "Owner Indemnitee" has the meaning specified in the definition of Excluded Payments. "Owner Participant" means the corporation executing the Participation Agreement as Owner Participant, and thereafter any Person to which such corporation transfers all of its right, title and interest in and to the Trust Agreement, the Trust Estate and the Participation Agreement, to the extent permitted by Section 8.01 of the Trust Agreement and Section 6.01(n) of the Participation Agreement. "Owner Trustee" means the entity executing the Participation Agreement as Owner Trustee and any entity appointed as successor Owner Trustee pursuant to Section 9.01 of the Trust Agreement, and references to a predecessor Owner Trustee in its individual capacity by name in the Operative Documents shall include such successor Owner Trustee in its individual capacity from and after such succession. "Participants" means and includes Pass Through Trustees and Owner Participant. "Participation Agreement" has the meaning set forth under the definition of "Agreement". "Parts" means any and all appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment of whatever nature (other than (a) complete Engines or engines, (b) any items leased by Lessee or any Permitted Sublessee, (c) cargo containers, (d) components or systems installed on or affixed to the Airframe that are used to provide individual telecommunications or electronic entertainment to passengers aboard the Aircraft, (e) medical and similar emergency equipment and (f) passenger service items and equipment generally used in but not affixed to the Aircraft, such as blankets, coffee pots, beverage and meal servicing carts, etc.), so long as the same are incorporated or installed in or attached to the Airframe or any Engine or so long as title thereto remains vested in Lessor in accordance with the terms of Section 8 of the Lease after removal from the Airframe or any Engine. "Pass Through Certificates" means the pass through certificates issued by Pass Through Trustees. "Pass Through Documents" means the Pass Through Trust Agreements, the Intercreditor Agreement, the Liquidity Facilities and the Policy Provider Agreement. "Pass Through Trust" means each of the three separate grantor trusts created pursuant to the Pass Through Trust Agreements to facilitate certain of the transactions contemplated by the Operative Documents. "Pass Through Trust Agreement" means each of the three separate Trust Supplements together in each case with the Basic Pass Through Trust Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Pass Through Trustee" has the meaning specified in the introductory paragraph to the Participation Agreement. "Pass Through Trustees" means, collectively, Pass Through Trustees under each Pass Through Trust Agreement. "Past Due Rate" means, (i) with respect to the portion of any payment of Rent that may be required by the Indenture to be paid by Loan Trustee to Noteholders as principal or interest with respect to a particular Series, a rate per annum equal to the applicable Debt Rate plus 1% and (ii) with respect to the remaining portion of any payment of Rent (and the entire amount of any payment of Rent after the satisfaction and discharge of the Indenture), a rate per annum equal to the Debt Rate for the Series G-2 Equipment Notes plus 1%. "Payment Date" means, for any Equipment Note, each July 2 and January 2, commencing with [______________]. "Payment Default" means the occurrence of an event that would give rise to an Event of Default under Section 14(a) of the Lease upon the giving of notice or the passing of time or both. "Permitted Investments" means each of (a) direct obligations of the United States and agencies thereof; (b) obligations fully guaranteed by the United States; (c) certificates of deposit issued by, or bankers' acceptances of, or time deposits with, any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. ("S&P") (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (d) commercial paper of any holding company of a bank, trust company or national banking association described in clause (c); (e) commercial paper of companies having a rating assigned to such commercial paper by either Moody's or S&P (or, if neither such organization then rates such commercial paper, by any nationally recognized rating organization in the United States) equal to either of the two highest ratings assigned by such organization; (f) Dollar-denominated certificates of deposit issued by, or time deposits with, the European subsidiaries of (i) any bank, trust company or national banking association described in clause (c), or (ii) any other bank or financial institution described in clause (h) or (i) below; (g) United States-issued Yankee certificates of deposit issued by, or bankers' acceptances of, or commercial paper issued by, any bank having combined capital and surplus and retained earnings of at least $100,000,000 and headquartered in Canada, Japan, the United Kingdom, France, Germany, Switzerland or The Netherlands and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (h) Dollar-denominated time deposits with any Canadian bank having a combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (i) Canadian Treasury Bills fully hedged to Dollars; (j) repurchase agreements with any financial institution having combined capital and surplus and retained earnings of at least $100,000,000 collateralized by transfer of possession of any of the obligations described in clauses (a) through (i) above; (k) bonds, notes or other obligations of any state of the United States, or any political subdivision of any state, or any agencies or other instrumentalities of any such state, including, but not limited to, industrial development bonds, pollution control revenue bonds, public power bonds, housing bonds, other revenue bonds or any general obligation bonds, that, at the time of their purchase, such obligations are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (1) bonds or other debt instruments of any company, if such bonds or other debt instruments, at the time of their purchase, are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (m) mortgage backed securities (i) guaranteed by the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation or the Government National Mortgage Association or rated AAA, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee and (ii) having an average life not to exceed 15 years as determined by standard industry pricing practices presently in effect; (n) asset-backed securities rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee; and (o) such other investments approved in writing by Loan Trustee; provided that, except in clause (m), the instruments described in the foregoing clauses shall have a maturity of no more than six months from the date of acquisition thereof. The bank acting as Pass Through Trustee or Loan Trustee is hereby authorized, in making or disposing of any investment described herein, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or such affiliate is acting as an agent of Pass Through Trustee or Loan Trustee or for any third person or dealing as principal for its own account. "Permitted Lien" has the meaning specified in Section 6 of the Lease. "Permitted Sublessee" means any Person to whom Lessee is permitted to sublease the Airframe or any Engine pursuant to Section 7(a) of the Lease. "Person" means any person, including any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, trustee, unincorporated organization or government or any agency or political subdivision thereof. "Policy Provider" means MBIA Insurance Corporation, a New York-domiciled stock insurance company. "Policy Provider Agreement" means the Insurance and Indemnity Agreement dated as of April 30, 2002 among Subordination Agent, Class G-1 Trustee, Class G-2 Trustee, Lessee and Policy Provider, including the related Policy Provider Fee Letter referred to therein, as amended, supplemented or otherwise modified from time to time in accordance with its terms. "Purchase Agreement" means Purchase Agreement No. 2022, dated as of October 21, 1997, which incorporates by reference the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, between Manufacturer and Lessee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Purchase Agreement Assignment" means that certain Purchase Agreement Assignment (N[_____]), dated as of [_____________, ____], between Lessee and Owner Trustee, as the same may be amended, modified, supplemented or modified from time to time in accordance with the terms thereof. "Rating Agencies" has the meaning specified in the Intercreditor Agreement. "Related Indemnitee Group" has the meaning specified in Section 4.03(b) of the Participation Agreement. ["Remaining Installments" has the meaning specified in Section 19(d) of the Lease.] "Renewal Term" means any Fair Market Renewal Term or Fixed Renewal Term. "Rent" means Basic Rent and Supplemental Rent, collectively. "Replacement Aircraft" means the Aircraft of which a Replacement Airframe is part. "Replacement Airframe" means a Boeing 737-832 aircraft or a comparable or improved model of Manufacturer (except (a) Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (b) items excluded from the definition of Parts (except Engines or engines)), that shall have been made subject to the Lease pursuant to Section 10(a) thereof, together with all Parts relating to such aircraft. "Replacement Engine" means a CFM International, Inc. CFM56-7B engine, which may be rated at or limited to -24 or higher power, (or an engine of the same or another manufacturer of a comparable or an improved model and suitable for installation and use on the Airframe with the other Engine (or any other Replacement Engine being substituted simultaneously therewith)) that is made subject to the Lease pursuant to Section 5(b), Section 9(c) or Section 10(b) thereof, together with all Parts relating to such engine. "Responsible Officer" means, (a) with respect to Lessee, its Chairman of the Board, its President, its Chief Operating Officer, any Executive Vice President, any Senior Vice President, the Chief Financial Officer, any Vice President, the Treasurer, the Controller or the Secretary, (b) with respect to Owner Trustee, a responsible officer in the Trust Office of Owner Trustee (including, without limitation, any authorized officer in the Trust Office of Owner Trustee), and (c) with respect to Loan Trustee, a responsible officer in the Corporate Trust Office of Loan Trustee. "Section 1110" means Section 1110 of the Bankruptcy Code. "Section 1110 Period" has the meaning specified in Section 4.04(a) of the Indenture. "Secured Obligations" has the meaning specified in Section 2.06 of the Indenture. "Series" means any series of Equipment Notes, including the Series G-1 Equipment Notes, the Series G-2 Equipment Notes, or the Series C Equipment Notes. "Series C Equipment Notes" means Equipment Notes issued and designated as "Series C Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series C Equipment Notes." "Series G-1 Equipment Notes" means Equipment Notes issued and designated as "Series G-1 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-1 Equipment Notes." "Series G-2 Equipment Notes" means Equipment Notes issued and designated as "Series G-2 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-2 Equipment Notes." "Special Purchase Price" means the amount denominated as such in Exhibit B-1 to the Lease. "State Street" has the meaning specified in the introductory paragraph of the Participation Agreement. "Stipulated Loss Value" with respect to the Aircraft as of any date through and including [_____________, ____], means, but subject always to the provisions of Section 3(c)(iv) of the Lease, the amount determined by multiplying Lessor's Cost for the Aircraft by the percentage specified in the last column of Exhibit C to the Lease opposite the Stipulated Loss Value Date with respect to which the amount is determined (as such Exhibit C may be adjusted from time to time as provided in Section 3(c) of the Lease and in Section 7 of the Tax Indemnity Agreement). "Stipulated Loss Value" as of any date after [______________, ____] shall be the amount determined as provided in Section 19(a) of the Lease. "Stipulated Loss Value Date" means the [_____] calendar day of each calendar month during the Basic Term and any Renewal Term. "Sublease" means any sublease permitted by the terms of Section 7(a) of the Lease. "Subordination Agent" has the meaning specified in the introductory paragraph of the Participation Agreement. "Supplemental Rent" means, without duplication, (a) all amounts, liabilities, indemnities and obligations (other than Basic Rent) which Lessee assumes or agrees to pay under any Operative Document to or on behalf of Lessor or any other Person, (b) amounts payable by Lessor pursuant to Section 2.14(b), Section 2.14(c), Section 2.14(d), Section 2.14(e) and Section 2.14(f) of the Indenture and (c) Lessor's pro rata share of all compensation and reimbursement of expenses, disbursements and advances payable by Lessee under the Pass Through Trust Agreements. As used herein, the "Lessor's pro rata share" means as of any time a fraction, the numerator of which is the principal balance then outstanding of Equipment Notes and the denominator of which is the aggregate principal balance then outstanding of all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement). "Tax" and "Taxes" mean all governmental fees (including, without limitation. license, filing and registration fees) and all taxes (including, without limitation, franchise, excise, stamp, value added, income, gross receipts, sales, use and property taxes), withholdings, assessments, levies, imposts, duties or charges, of any nature whatsoever, together with any related penalties, fines, additions to tax or interest thereon imposed, withheld, levied or assessed by any country, taxing authority or governmental subdivision thereof or therein or by any international authority, including any taxes imposed on any Person as a result of such Person being required to collect and pay over withholding taxes. "Tax Indemnitee" means (i) Owner Participant, Owner Trustee, in its individual capacity and as trustee under the Trust Agreement, the Trust Estate, Loan Trustee, each Pass Through Trustee as, but only so long as such Pass Through Trustee is, the owner of any Equipment Note, Subordination Agent as, but only so long as it is, the registered holder of any Equipment Note, (ii) the respective affiliates, successors and permitted assigns of each of the entities described in the preceding clause (i), and (iii) the Indenture Estate. For purposes of this definition, the term "Owner Participant" shall include any member of an affiliated group (within the meaning of Section 1504 of the Code) of which Owner Participant is a member and any entity with which Owner Participant files a consolidated or combined state income tax return. "Tax Indemnity Agreement" means that certain Tax Indemnity Agreement (N[_____]), dated as of [________________, ____], between Owner Participant and Lessee, as originally executed or as modified, amended or supplemented pursuant to the applicable provisions thereof. "Term" means the Basic Term and, if actually entered into, any Renewal Term. "Termination Date" has the meaning set forth in Section 9(a) of the Lease. "Termination Value" with respect to the Aircraft as of any date through and including [______________, ____], means, but subject always to the provisions of Section 3(c)(iv) of the Lease, the amount determined by multiplying Lessor's Cost for the Aircraft by the percentage specified in the last column of Exhibit D of the Lease opposite the Termination Date with respect to which the amount is determined (as such Exhibit D may be adjusted from time to time as provided in Section 3(c) of the Lease and in Section 7 of the Tax Indemnity Agreement). "Transaction Expenses" means: all of the actual and reasonable out-of-pocket costs, fees and expenses incurred by Owner Trustee, Owner Participant, Pass Through Trustee, Subordination Agent and Loan Trustee in connection with the transactions contemplated by the Participation Agreement, the other Operative Documents, the Pass Through Trust Agreements, the Intercreditor Agreement, the Liquidity Facilities, the Policy Provider Agreement and the Underwriting Agreement (except, in each case, as otherwise provided therein) including, without limitation: (1) the reasonable and actual fees, expenses and disbursements of (A) Bingham Dana LLP, special counsel for Pass Through Trustee, Subordination Agent and Loan Trustee, (B) Ray, Quinney & Nebeker, special counsel for Owner Trustee and (C) Shearman & Sterling, special counsel for Underwriters; (2) the initial fees and reasonable and actual disbursements of Owner Trustee under the Trust Agreement; (3) the initial fee and reasonable and actual disbursements of Loan Trustee under the Indenture; (4) the pro rata share of the initial fees and expenses of Liquidity Provider, Policy Provider, Pass Through Trustee and Subordination Agent; (5) the pro rata share of the underwriting fees and commissions; (6) the fees and expenses with respect to the appraisals (including a pro rata share of the appraisals relating to the Pass Through Certificates) of the Aircraft; (7) the reasonable fees, expenses and disbursements of [___________________], special counsel to Owner Participant, such fees not to exceed the amount previously agreed to by Owner Participant and Lessee; (8) the costs of filing and recording documents with the FAA; (9) the pro rata share of the reasonable fees, expenses and disbursements of Milbank, Tweed, Hadley & McCloy LLP, special counsel to Liquidity Provider; (10) the pro rata share of the reasonable fees, expenses and disbursements of Latham & Watkins, special counsel to Policy Provider; and (11) the equity placement fee and reasonable disbursements of Babcock and Brown Financial Corporation. "Transportation Code" means that portion of Title 49 of the United States Code comprising those provisions formerly referred to as the Federal Aviation Act of 1958, as amended, or any subsequent legislation that amends, supplements or supersedes such provisions. "Trust Agreement" means that certain Trust Agreement [N[_____]), dated as of [______________, ____], between Owner Participant and Wells Fargo Bank Northwest, National Association, in its individual capacity, as originally executed or as modified, amended or supplemented pursuant to the applicable provisions thereof. "Trust Estate" means the Trust Estate as that term is defined in the Trust Agreement. "Trust Office" has the meaning set forth under the definition of "Corporate Trust Department". "Trust Supplements" means those agreements supplemental to the Basic Pass Through Trust Agreement referred to in Schedule II to the Participation Agreement. "Underwriters" means the several underwriters listed as such in the Underwriting Agreement. "Underwriting Agreement" means that certain Underwriting Agreement, dated April [__], 2002, among Lessee and Underwriters. "United States" means the United States of America. "U.S. Government Obligations" means securities that are direct obligations of the United States for the payment of which its full faith and credit is pledged which are not callable or redeemable, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligations or a specific payment of interest on or principal of any such U.S. Government Obligations held by such custodian for the account of the holder of a depository receipt so long as such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of interest on or principal of the U.S. Government Obligations evidenced by such depository receipt. "Warranty Rights" means all right and interest of Lessee in, to and under Parts 1, 2, 3, 4 and 6 of the Product Assurance Document attached as Exhibit C to the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, but only to the extent the same relate to continuing rights of Lessee in respect of any warranty or indemnity, express or implied, pursuant to the Product Assurance Document with respect to the Airframe, it being understood that the Warranty Rights exclude any and all other right, title and interest of Lessee in, to and under the Purchase Agreement and that the Warranty Rights are subject to the terms of the Manufacturer's Consent. "Wells Fargo" means Wells Fargo Bank Northwest, National Association, a national banking association. EXHIBIT H TO PARTICIPATION AGREEMENT FORM OF LEASE AGREEMENT ================================================================================ LEASE AGREEMENT (N ____) Dated as of [_________ ___, 200_] Between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, Not in its Individual Capacity, except as expressly provided herein, but solely as Owner Trustee, Lessor AND DELTA AIR LINES, INC., Lessee One Boeing 737-832 Aircraft ============================================================================== As set forth in Section 20 hereof, Lessor has assigned to Loan Trustee (as defined herein) certain of its right, title and interest in and to this Lease. To the extent, if any, that this Lease constitutes chattel paper (as such term is defined in the Uniform Commercial Code as in effect in any applicable jurisdiction) no security interest in this Lease may be created through the transfer or possession of any counterpart other than the original executed counterpart, which shall be identified as the counterpart containing the receipt therefor executed by Loan Trustee on the signature page thereof. TABLE OF CONTENTS Page SECTION 1. Definitions.................................................... SECTION 2. Acceptance and Lease........................................... SECTION 3. Term and Rent.................................................. (a) Basic Term.............................................. (c) Basic Rent.............................................. (d) Adjustments to Basic Rent............................... (e) Supplemental Rent....................................... (f) Payments in General..................................... SECTION 4. Lessor's Representations and Warranties........................ SECTION 5. Return of the Aircraft......................................... (a) Condition Upon Return................................... (b) Return of the Engines................................... (c) Fuel; Manuals........................................... SECTION 6. Liens.......................................................... SECTION 7. Registration, Maintenance and Operation; Possession and Subleases; Insignia....................................... (a) Registration and Maintenance............................ SECTION 8. Replacement and Pooling of Parts; Alterations, Modifications and Additions............................... (a) Replacement of Parts.................................... (b) Pooling of Parts........................................ (c) Alterations, Modifications and Additions................ SECTION 9. Voluntary Termination.......................................... (a) Termination Event....................................... (c) Optional Sale of the Aircraft........................... (d) Termination as to Engines............................... SECTION 10. Loss, Destruction, Requisition, etc........................... (a) Event of Loss with Respect to the Aircraft.............. (b) Event of Loss with Respect to an Engine................. (f) Application of Payments During Existence of Event of Default............................................... SECTION 11. Insurance..................................................... SECTION 12. Inspection.................................................... SECTION 13. Assignment.................................................... SECTION 14. Events of Default............................................. SECTION 15. Remedies...................................................... SECTION 16. Lessee's Cooperation Concerning Certain Matters............... SECTION 17. Notices....................................................... SECTION 18. No Set-Off, Counterclaim, etc................................. SECTION 19. Renewal Options; Purchase Options; Valuation.................. (a) Renewal Options......................................... (b) Purchase Options........................................ (c) Valuation............................................... (d) Special Purchase Option................................. SECTION 20. Security for Lessor's Obligation to Holders of Secured Certificates.............................................. SECTION 21. Lessor's Right to Perform for Lessee.......................... SECTION 22. Investment of Security Funds; Liability of Lessor Limited..... (a) Investment of Security Funds............................ (b) Liability of Lessor Limited............................. SECTION 23. Submission to Jurisdiction.................................... SECTION 24. Miscellaneous................................................. SECTION 25. Successor Trustee............................................. SECTION 26. Covenant of Quiet Enjoyment................................... SECTION 27. Lessee's Performance and Rights............................... ANNEXES AND EXHIBITS EXHIBIT A - Form of Lease Supplement EXHIBIT B-1 - Basic Rent Payment, Lessor's Cost and Special Purchase Price Schedule EXHIBIT B-2 - Basic Rent Allocation Schedule EXHIBIT C - Stipulated Loss Value Schedule EXHIBIT D - Termination Value Schedule EXHIBIT E - Rent Recalculation Verification EXHIBIT F - Aircraft Type Equipment Value for Section 11(b) ANNEX A - Definitions LEASE AGREEMENT (N____) This LEASE AGREEMENT (N____), dated as of [______ __, 200_], between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Owner Trustee under the Trust Agreement (as defined in Annex A) (in such capacity, "Lessor"), and DELTA AIR LINES, INC., a corporation organized and existing pursuant to the laws of the State of Delaware ("Lessee"); W I T N E S S E T H: SECTION 1. Definitions. (a) For all purposes of this Lease, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. (b) Other Definitional Provisions. The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (i) All references in this Lease to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Lease, unless otherwise specifically stated. (ii) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Lease as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (iii) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". (iv) All references in this Lease to a "government" are to such government and any instrumentality or agency thereof. SECTION 2. Acceptance and Lease. Lessor hereby agrees (subject to satisfaction of the conditions set forth in Section 3.01 of the Participation Agreement) to accept the transfer of title from and simultaneously to lease to Lessee hereunder, and Lessee hereby agrees (subject to satisfaction of the conditions set forth in Section 3.02 of the Participation Agreement) to lease from Lessor hereunder, the Aircraft as evidenced by the execution by Lessor and Lessee of a Lease Supplement leasing the Aircraft hereunder. Lessee hereby agrees that such acceptance of the Aircraft by Lessor shall, without further act, irrevocably constitute acceptance by Lessee of such Aircraft for all purposes of this Lease. SECTION 3. Term and Rent. (a) Basic Term. The Basic Term shall commence on the Delivery Date and end on [____________ __, 20__], or such earlier date as this Lease may be terminated in accordance with the provisions hereof. (b) Basic Rent. Lessee shall pay Basic Rent on each Lease Period Date during the Basic Term, in installments, in the amounts specified in Exhibit B-1. Each such installment of Basic Rent shall be equal to Lessor's Cost multiplied by the percentage for the applicable Lease Period Date specified in Exhibit B-1. Lessor and Lessee agree that Basic Rent shall be allocated as specified in Exhibit B-2. (c) Adjustments to Basic Rent. (i) If the Delivery Date does not occur on [____________________] or Transaction Expenses paid by Lessor pursuant to Article 12 of the Participation Agreement are other than [_____]% of Lessor's Cost, then in each case the Basic Rent percentages set forth in Exhibit B-1, the allocation of Basic Rent set forth in Exhibit B-2, the Stipulated Loss Value percentages set forth in Exhibit C, the Termination Value percentages set forth in Exhibit D[, the Initial Installments, the Remaining Installments] and the Special Purchase Price shall be recalculated by Owner Participant, on or prior to [__________________], using the same methods and assumptions used to calculate original Basic Rent percentages and allocations, Stipulated Loss Value and Termination Value percentages[, the Initial Installments, the Remaining Installments] and the Special Purchase Price in order to: (1) maintain Owner Participant's Net Economic Return and (2) to the extent possible consistent with clause (1) hereof, minimize the Net Present Value of Rents. In such recalculation there will be no change in the amortization of the Equipment Notes. (ii) (A) In the event of a refinancing as contemplated by Article 13 of the Participation Agreement, then the Basic Rent percentages set forth in Exhibit B-1, the allocation of Basic Rent set forth in Exhibit B-2, the Stipulated Loss Value percentages set forth in Exhibit C, the Termination Value percentages set forth in Exhibit D[, the Initial Installments, the Remaining Installments] and the Special Purchase Price shall be recalculated (upwards or downwards) by Owner Participant as contemplated by such Article 13 to (1) maintain Owner Participant's Net Economic Return and (2) to the extent possible consistent with clause (1) hereof, minimize the Net Present Value of Rents and (B) if Lessee elects to satisfy any indemnity obligation pursuant to Section [4(d)(ii)] of the Tax Indemnity Agreement, then the Basic Rent percentages set forth in Exhibit B-1, the allocation of Basic Rent set forth in Exhibit B-2, the Stipulated Loss Value percentages set forth in Exhibit C, the Termination Value percentages set forth in Exhibit D[, the Initial Installments, the Remaining Installments] and the Special Purchase Price shall be recalculated (upwards or downwards) by Owner Participant, using the same methods and assumptions (except to the extent such assumptions must be modified to take into account the Loss (as defined in the Tax Indemnity Agreement) that is the subject of such indemnification and any prior or contemporaneous Loss) used to calculate the Basic Rent percentages and allocations, the Stipulated Loss Value percentages, the Termination Value percentages[, the Initial Installments, the Remaining Installments] and the Special Purchase Price on the Delivery Date, in order to (1) maintain Owner Participant's Net Economic Return and (2) to the extent possible consistent with clause (1) hereof, minimize the Net Present Value of Rents. (iii) Any recalculation of Basic Rent percentages and allocations, Stipulated Loss Value and Termination Value percentages[, the Initial Installments, the Remaining Installments] and the Special Purchase Price pursuant to this Section 3(c) shall be determined by Owner Participant subject to the verification procedures set forth in Exhibit E. Such recalculated Basic Rent percentages and allocations, Stipulated Loss Value and Termination Value percentages and Special Purchase Price shall be set forth in a Lease Supplement or an amendment to this Lease. (iv) Anything contained in the Participation Agreement or this Lease to the contrary notwithstanding, each installment of Basic Rent, whether or not adjusted in accordance with this Section 3(c), shall, and each payment of Termination Value and Stipulated Loss Value, whether or not adjusted in accordance with this Section 3(c), shall, together with all other amounts (including the Make-Whole Amount, if any, payable by Lessor on the Equipment Notes) payable simultaneously by Lessee pursuant to this Lease, in each case be, under any circumstances and in any event, in an amount at least sufficient to pay in full, on the date on which such amount of Rent is due, any payments then required to be made on account of the principal of, Make-Whole Amount, if any, and interest on the Equipment Notes. No installment of Basic Rent or payment of Termination Value or Stipulated Loss Value shall be increased or adjusted by reason of (i) any attachment or diversion of Rent on account of Lessor Liens or any Noteholder Lien on or against the Trust Estate, any part thereof or the Operative Documents arising as a result of claims against Loan Trustee not related to the transactions contemplated by the Operative Documents, (ii) any modification of the payment terms of the Equipment Notes made without the prior written consent of Lessee or (iii) the acceleration of any Equipment Note or Equipment Notes due to the occurrence of an "Event of Default" (as defined in the Indenture) which does not constitute an Event of Default hereunder. (v) All adjustments to Basic Rent percentages and allocations under this Section 3(c) shall be (A) in compliance with the tests of ss.ss. 4.02(5) and 4.07 of Rev. Proc. 2001-29 and will not cause this Lease to constitute a "disqualified leaseback or long-term agreement" within the meaning of Section 467 of the Internal Revenue Code of 1986, as amended, as each is then in effect and (B) subject to verification pursuant to Exhibit E. (d) Supplemental Rent. Lessee shall pay (or cause to be paid) promptly to Lessor, or to whoever is entitled thereto, any and all Supplemental Rent constituting Stipulated Loss Value or Termination Value as the same becomes due and owing and all other amounts of Supplemental Rent within five (5) Business Days after demand or within such other relevant period as is provided in any Operative Document. If Lessee fails to pay any Supplemental Rent when due, Lessor shall have all rights, powers and remedies provided for herein or in any other Operative Document or by law or equity or otherwise in the case of nonpayment of Basic Rent. Lessee shall pay as Supplemental Rent the Make-Whole Amount, if any, due pursuant to Section 2.10(b) or Section 2.11 of the Indenture in connection with a prepayment of the Equipment Notes upon redemption of such Equipment Notes in accordance with Section 2.10(b) or Section 2.11 of the Indenture. Lessee also will pay to Lessor, or to whoever is entitled thereto, on demand, as Supplemental Rent, to the extent permitted by applicable law, interest at the Past Due Rate on any part of any installment of Basic Rent not paid when due for any period for which the same is overdue and on any payment of Supplemental Rent not paid when due for the period until paid. (e) Payments in General. All payments of Rent shall be made in Dollars by wire transfer of immediately available funds prior to 10:00 a.m., New York time, on the date of payment, to Lessor at its account at Wells Fargo Bank Northwest, National Association, MAC: U1254-031, 79 South Main Street, Salt Lake City, Utah 84111, ABA No. 121-0002-48, Account No. 051-0922115, Attention: Corporate Trust Department, Credit Delta (N____) (or such other account of Lessor in the continental United States as Lessor directs by notice to Lessee at least ten (10) business days prior to the due date); provided that so long as the Indenture has not been fully discharged, Lessor hereby irrevocably directs and Lessee agrees, that, unless Loan Trustee otherwise directs, all Rent payable to Lessor and assigned to Loan Trustee pursuant to the Indenture shall be paid prior to 10:00 a.m., New York time on the due date thereof in funds of the type specified in this Section 3(e) directly to Loan Trustee at its account at State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110, ABA No. 011-000-028, Account No. 9903-990-1, Attention: Corporate Trust Department, Reference: Delta (N____) (or such other account of Loan Trustee in the continental United States as Loan Trustee directs by notice to Lessee at least ten (10) business days prior to the due date). Lessor hereby directs and Lessee agrees that all payments of Supplemental Rent owing to Loan Trustee or to a Noteholder pursuant to the Participation Agreement shall be made in Dollars in immediately available funds prior to 12:00 noon, New York time, on the due date thereof at the office of Loan Trustee or at such other office of such other financial institution located in the continental United States as the party entitled thereto directs at least ten (10) business days prior to the due date. All payments of Supplemental Rent payable to Owner Participant, to the extent that such amounts constitute Excluded Payments, shall be made in Dollars in immediately available funds prior to 10:00 a.m., New York time, on the due date thereof, to the account of Owner Participant specified in Section 16.12 of the Participation Agreement (or to such other account specified by Owner Participant by notice to Lessee). Notwithstanding anything to the contrary contained herein, if any date on which a payment of Rent becomes due and payable is not a Business Day, then such payment shall not be made on such date but shall be made on the next succeeding Business Day without interest with the same force and effect (provided such payment is made on such next succeeding Business Day). SECTION 4. Lessor's Representations and Warranties. LESSOR LEASES AND LESSEE TAKES THE AIRCRAFT AND EACH PART THEREOF "AS-IS," "WHERE-IS." NEITHER LESSOR, LOAN TRUSTEE NOR ANY PARTICIPANT MAKES, HAS MADE OR SHALL BE DEEMED TO HAVE MADE, AND EACH HEREBY EXPRESSLY DISCLAIMS AND WILL BE DEEMED TO HAVE EXPRESSLY DISCLAIMED, ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, WORKMANSHIP, CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR A PARTICULAR PURPOSE OF THE AIRCRAFT OR ANY PART THEREOF, AS TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT OR ANY PART THEREOF, except that Wells Fargo Bank Northwest, National Association, in its individual capacity, (i) represents and warrants that on the Delivery Date, Lessor shall have received whatever title to the Aircraft was conveyed to it by Lessee, (ii) represents and warrants that on the Delivery Date the Aircraft shall be free of Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to it, (iii) covenants that it will not, through its own actions or inactions, interfere in Lessee's quiet enjoyment of the Aircraft during the Term, (iv) agrees that it will not directly or indirectly create, incur, assume or suffer to exist any Lessor Lien attributable to it on or with respect to the Airframe or any Engine or any portion of the Trust Estate and (v) represents and warrants that it is a Citizen of the United States without making use of a voting trust, voting powers agreement or similar arrangement, and agrees that if at any time it ceases to be a Citizen of the United States without making use of a voting trust, voting powers agreement or similar arrangement it will promptly resign as Owner Trustee (if and so long as such citizenship is necessary under the Transportation Code as in effect at such time or, if it is not necessary, if and so long as Owner Trustee's citizenship would have any material adverse effect on Noteholders, Owner Participant or Lessee), effective upon the appointment of a successor Owner Trustee in accordance with Section 9.01 of the Trust Agreement. None of the provisions of this Lease shall be deemed to amend, modify or otherwise affect the representations, warranties or other obligations (express or implied) of Manufacturer or any subcontractor or supplier of Manufacturer with respect to the Airframe, the Engines or any Parts, or to release Manufacturer or any such subcontractor or supplier from any such representation, warranty or obligation. Lessor agrees that it will not directly or indirectly create, incur, assume or suffer to exist any Lessor Lien attributable to it on or with respect to the Airframe or any Engine. SECTION 5. Return of the Aircraft. (a) Condition Upon Return. Unless purchased by Lessee pursuant to Section 19, upon the termination of this Lease at the end of the Basic Term or any Renewal Term or pursuant to Section 9(b) or 15, Lessee, at its own expense, will return the Airframe to Lessor at Hartsfield Atlanta International Airport or another major airport at which Lessee has major avionics maintenance capabilities in one of the forty-eight contiguous states of the United States chosen by Lessee, and Lessee will give Lessor at least ten (10) days' prior notice of the place of such return. At the time of such return, the following conditions will be met. Unless otherwise requested by Lessor at least ninety (90) days prior to such return, Lessee will cause the Aircraft, if it is not then so registered, to be registered under the laws of the United States with the FAA in the name of Lessor or its designee, provided that Lessee shall be relieved of its obligations under this sentence if (i) such registration is prohibited by reason of the failure of Lessor or its designee to be eligible on such date to own an aircraft registered with the FAA or (ii) such registration is otherwise prohibited by applicable law. The Airframe will be fully equipped with the Engines (or other CFM International, Inc. CFM56-7B engines or two engines of the same or another manufacturer of a comparable or improved model, of not less than equivalent utility, value and remaining useful life, and suitable for installation and use on the Airframe without impairing the value, utility or remaining useful life of the Aircraft; provided that both engines shall be of the same make and model) duly installed thereon. Also, at the time of such return, such Airframe and Engines or engines (i) shall be certified (or, if not then registered under the Transportation Code, shall be eligible for certification) as an airworthy aircraft by the FAA, (ii) shall be free and clear of all Liens (other than Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), Loan Trustee Liens and Noteholder Liens) and rights of third parties under pooling, interchange, overhaul, repair or other similar agreements or arrangements, (iii) shall be in good operating condition or, in the case of any such engines owned by Lessee, shall be in as good operating condition as required by the terms hereof with respect to Engines constituting part of the Aircraft but not then installed on the Airframe, and (iv) shall be in compliance with the return conditions set forth in Exhibit J to the Participation Agreement. (b) Return of the Engines. If any engine not owned by Lessor is returned with the Airframe as set forth in paragraph (a) of this Section 5, Lessee, concurrently with such delivery, will, at no cost to Lessor, furnish, or cause to be furnished, to Lessor a full warranty (as to title) bill of sale with respect to each such engine, in form and substance reasonably satisfactory to Lessor (together with an opinion of counsel to the effect that such full warranty bill of sale has been duly authorized and delivered and is enforceable in accordance with its terms and that such engines are free and clear of Liens other than Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), Loan Trustee Liens and Noteholder Liens), against receipt from Lessor of a bill of sale evidencing the transfer, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), by Lessor to Lessee or its designee of all of Lessor's right, title and interest in and to any Engine not being returned with the Airframe. (c) Fuel; Manuals. Upon the return of the Airframe pursuant to paragraph (a) of this Section 5, (i) Lessor shall pay Lessee, as compensation for any fuel or oil contained in the fuel or oil tanks of such Airframe, the value of such fuel or oil at the price paid by Lessee for such fuel or oil, as the case may be, and (ii) Lessee shall deliver or cause to be delivered to Lessor all relevant logs, manuals and data and inspection, maintenance and modification records required to be maintained with respect thereto under applicable rules and regulations of each country under the laws of which the Aircraft has been registered during the Term, which logs, manuals, data and records, if not maintained in English, shall be translated into English at no cost to Lessor. SECTION 6. Liens. Lessee will not directly or indirectly create, incur, assume or suffer to exist any Lien on or with respect to the Aircraft, title thereto or any interest therein or in this Lease, except (i) the respective rights of Lessor and Lessee as provided in the Operative Documents, the Lien of the Indenture, the rights of any Permitted Sublessee under a Sublease permitted hereunder, and the rights of any Person existing pursuant to the Operative Documents or the Pass Through Documents, (ii) the rights of others under agreements or arrangements to the extent expressly permitted by this Lease, (iii) Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), Noteholder Liens, Loan Trustee Liens and Other Party Liens, (iv) Liens for Taxes either not yet due or being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Lessor's or Loan Trustee's interest therein, or, so long as any Equipment Notes are outstanding, materially impair the Lien of the Indenture, (v) materialmen's, mechanics', workers', repairmen's, employees' or other like Liens arising in the ordinary course of business (including those arising under maintenance agreements entered into in the ordinary course of business) securing obligations that either are not yet overdue for a period of more than sixty (60) days or are being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Lessor's or Loan Trustee's interest therein or, so long as any Equipment Notes are outstanding, materially impair the Lien of the Indenture, (vi) Liens arising out of any judgment or award, so long as such judgment is, within sixty (60) days after the entry thereof, discharged, vacated or reversed, or execution thereof stayed pending appeal or other judicial review or is discharged, vacated or reversed within sixty (60) days after the expiration of such stay, (vii) any other Lien with respect to which Lessee provides a bond, cash collateral or other security adequate in the reasonable opinion of Lessor, (viii) salvage or similar rights of insurers under insurance policies maintained by Lessee, and (ix) Liens approved in writing by Lessor. Liens described in clauses (i) through (ix) above are referred to as "Permitted Liens". Lessee shall promptly, at its own expense, take (or cause to be taken) such action as may be necessary duly to discharge (by bonding or otherwise) any Lien other than a Permitted Lien that arises at any time. SECTION 7. Possession, Operation and Use, Maintenance and Registration. (a) Possession. Without the prior written consent of Lessor, Lessee shall not sublease or otherwise in any manner deliver, transfer or relinquish possession of the Airframe or any Engine or install any Engine, or permit any Engine to be installed, on any airframe other than the Airframe; provided that, as long as the action to be taken shall not deprive Loan Trustee of the perfected first priority Lien of the Indenture on the Airframe or (subject to the further proviso (B) to clause (i) of this Section 7(a)) any Engine, Lessee (or, except with respect to clauses (viii) and (ix) below, any Permitted Sublessee) may without the prior written consent of Lessor: (i) subject the Airframe to interchange agreements or subject any Engine to interchange or pooling agreements or arrangements, in each case entered into by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) in the ordinary course of its business; provided that (A) no such agreement or arrangement contemplates or requires the transfer of title to the Airframe and (B) if Lessor's title to any such Engine is divested under any such agreement or arrangement, such divestiture shall be deemed to be an Event of Loss with respect to such Engine, and Lessee shall comply with Section 10(b) in respect thereof; (ii) deliver possession of the Airframe or any Engine to any Person for testing, service, repair, restoration, storage, maintenance or other similar purposes or for alterations, modifications or additions to the Airframe or such Engine to the extent required or permitted by the terms hereof; (iii) for a period not to extend beyond the end of the Term, transfer or permit the transfer of possession of the Airframe or any Engine to any Government pursuant to a sublease, contract or other instrument; (iv) subject (or permit any Permitted Sublessee to subject) the Airframe or any Engine to the CRAF Program or transfer (or permit any Permitted Sublessee to transfer) possession of the Airframe or any Engine to the United States government in accordance with applicable laws, rulings, regulations or orders (including, without limitation, any transfer of possession pursuant to the CRAF Program); provided, that Lessee (or any Permitted Sublessee) (A) shall promptly notify Lessor upon transferring possession of the Airframe or any Engine pursuant to this clause (iv) and (B) in the case of a transfer of possession pursuant to the CRAF Program, shall notify Lessor of the name and address of the responsible Contracting Office Representative for the Military Airlift Command of the United States Air Force or other appropriate Person to whom notices must be given and to whom requests or claims must be made to the extent applicable under the CRAF Program; (v) install an Engine on an airframe owned by Lessee (or any Permitted Sublessee) free and clear of all Liens, except (A) Permitted Liens and Liens that apply only to the engines (other than Engines), appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment (other than Parts) installed on such airframe (but not to the airframe as an entirety) and (B) the rights of third parties under interchange agreements or pooling or similar arrangements that would be permitted under clause (i) above; (vi) install an Engine on an airframe leased to Lessee (or any Permitted Sublessee) or purchased or owned by Lessee (or any Permitted Sublessee) subject to a conditional sale or other security agreement; provided that: (A) such airframe is free and clear of all Liens except (1) the rights of the parties to the lease or conditional sale or other security agreement covering such airframe, or their successors and assigns, and (2) Liens of the type permitted by clause (v) of this Section 7(a); and (B) either: (1) Lessee has obtained from the lessor or secured party of such airframe a written agreement (which may be the lease, conditional sale or other security agreement covering such airframe), in form and substance satisfactory to Lessor (an agreement from such lessor or secured party substantially in the form of the penultimate paragraph of this Section 7(a) being deemed to be satisfactory to Lessor), whereby such lessor or secured party expressly agrees that neither it nor its successors or assigns will acquire or claim any right, title or interest in any Engine by reason of such Engine being installed on such airframe at any time while such Engine is subject to this Lease, or (2) such lease, conditional sale or other security agreement provides that such Engine shall not become subject to the Lien of such lease, conditional sale or other security agreement at any time while such Engine is subject to this Lease, notwithstanding its installation on such airframe; (vii) install an Engine on an airframe owned by Lessee (or any Permitted Sublessee), leased to Lessee (or any Permitted Sublessee) or purchased by Lessee (or any Permitted Sublessee) subject to a conditional sale or other security agreement under circumstances where neither clause (v) nor clause (vi) of this Section 7(a) is applicable; provided that such installation shall be deemed an Event of Loss with respect to such Engine, and Lessee shall comply with Section 10(b) in respect thereof, if such installation adversely affects Lessor's right and interest in, such Engine, Lessor not intending hereby to waive any right or interest it may have to or in such Engine under applicable law until compliance by Lessee with Section 10(b); (viii) sublease any Engine or the Airframe and Engines to any United States air carrier as to which there is in force a certificate issued pursuant to the Transportation Code (49 U.S.C. Sections 41101-41112) or successor provision that gives like authority; and (ix) sublease any Engine or the Airframe and Engines to (A) any foreign air carrier other than those set forth in clause (B), (B) any foreign air carrier that is at the inception of the lease based in and a domiciliary of a country listed in Exhibit I to the Participation Agreement, (C) the manufacturer of the Airframe or any Engine (either directly or through an affiliate), and (D) any foreign air carrier consented to in writing by Lessor, which consent shall not be unreasonably withheld; provided that (x) in the case of a sublease to a foreign air carrier under clause (A) above, Lessor receives at the time of such sublease (1) written confirmation from each of the Rating Agencies that such sublease would not result in a reduction of the rating for any class of Pass Through Certificates below the then current rating for such class of Pass Through Certificates or a withdrawal or suspension of the rating of any class of Pass Through Certificates without regard to the Policy (as defined in the Policy Provider Agreement)and (2) an opinion of counsel to Lessee (such counsel to be reasonably satisfactory to Lessor) to the effect that there exist no possessory rights in favor of the sublessee under the laws of such sublessee's country which would, upon bankruptcy or insolvency of or other default by Lessee and assuming at such time such sublessee is not insolvent or bankrupt, prevent the taking of possession of any such Engine or the Airframe and any such Engine by Lessor in accordance with and when permitted by the terms of Section 15 upon the exercise by Lessor of its remedies under Section 15, (y) in the case of a sublease to any foreign air carrier (other than a foreign air carrier principally based in Taiwan), the United States maintains diplomatic relations with the country in which such foreign air carrier is based at the time such sublease is entered into and (z) in the case of any sublease to a foreign air carrier, such carrier is not then subject to any bankruptcy, insolvency, liquidation, reorganization, dissolution or similar proceeding and shall not have substantially all of its property in the possession of any liquidator, trustee, receiver or similar person; provided that the rights of any sublessee or other transferee who receives possession of the Aircraft, the Airframe or any Engine by reason of a transfer permitted by this Section 7(a) (other than the transfer of an Engine which is deemed an Event of Loss) shall be subject and subordinate to, and any permitted sublease shall be made expressly subject and subordinate to, all the terms of this Lease and the Lien of the Indenture, including Lessor's rights to repossess pursuant to Section 15 and to avoid such sublease upon such repossession, and Lessee shall remain primarily liable hereunder for the performance and observance of all of the terms and conditions of this Lease to the same extent as if such sublease or transfer had not occurred, any such sublease shall include appropriate provisions for the maintenance and insurance of the Aircraft, the Airframe or such Engine, and no lease or transfer of possession otherwise in compliance with this Section shall (x) result in any registration or re-registration of the Aircraft except to the extent permitted in Section 7(e) or the maintenance, operation or use thereof that does not comply with Section 7(b) and (c) or (y) permit any action not permitted to be taken by Lessee with respect to the Aircraft hereunder. Lessee shall promptly notify Lessor and the Rating Agencies of the existence of any such sublease with a term in excess of one year. Lessor agrees, for the benefit of Lessee (and any Permitted Sublessee) and for the benefit of the lessor or secured party of any airframe or engine leased to Lessee (or any Permitted Sublessee) or purchased or owned by Lessee (or any Permitted Sublessee) subject to a conditional sale or other security agreement, that none of Lessor, its successors or assigns will acquire or claim, as against Lessee (or any Permitted Sublessee) or such lessor or secured party, any right, title or interest in: (A) any engine or engines owned by Lessee (or any Permitted Sublessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of such engine or engines being installed on the Airframe, or (B) any airframe owned by Lessee (or any Permitted Sublessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of any Engine being installed on such airframe. Lessor acknowledges that any "wet lease" or other similar arrangement under which Lessee (or a Permitted Sublessee) maintains operational control of the Aircraft does not constitute a delivery, transfer or relinquishment of possession for purposes of this Section 7(a). (b) Operation and Use. Lessee agrees that the Aircraft will not be maintained, used or operated in violation of any law, rule or regulation of any government of any country having jurisdiction over the Aircraft or in violation of any airworthiness certificate, license or registration relating to the Aircraft issued by any such government, except to the extent Lessee (or, if a Sublease is then in effect, any Permitted Sublessee) is contesting in good faith the validity or application of any such law, rule or regulation in any manner that does not involve any material risk of sale, forfeiture or loss of the Aircraft or materially adversely affect Lessor or, if any Equipment Notes are outstanding, materially impair the Lien of the Indenture; provided, that Lessee shall not be in default under, or required to take any action set forth in, this sentence if it is not possible for it to comply with the laws of a jurisdiction other than the United States (or other than any jurisdiction in which the Aircraft is then registered) because of a conflict with the applicable laws of the United States (or such jurisdiction in which the Aircraft is then registered). Lessee will not operate the Aircraft, or permit the Aircraft to be operated or located, (i) in any area excluded from coverage by any insurance required by the terms of Section 11 or (ii) in any war zone or recognized or, in Lessee's judgment, threatened areas of hostilities unless covered by war risk insurance in accordance with Section 11, unless in the case of either clause (i) or (ii), (x) indemnification complying with Section 11 (a) and (b) has been provided or (y) the Aircraft is only temporarily located in such area as a result of an isolated occurrence or isolated series of occurrences attributable to a hijacking, medical emergency, equipment malfunction, weather conditions, navigational error or other similar unforeseen circumstances and Lessee is using its good faith efforts to remove the Aircraft from such area as promptly as practicable. (c) Maintenance. Lessee shall maintain, service and repair the Aircraft (or cause the same to be done) so as to keep the Aircraft in good operating condition and in such condition as may be necessary to enable the airworthiness certification of the Aircraft to be maintained in good standing at all times (other than during temporary periods of storage, during maintenance, testing or modification permitted hereunder, or during periods of grounding by applicable governmental authorities) under the Transportation Code, during such periods in which the Aircraft is registered under the laws of the United States, or, if the Aircraft is registered under the laws of any other jurisdiction, the applicable laws of such jurisdiction and utilizing the same manner and standard of care used by Lessee (or a Permitted Sublessee) with respect to similar aircraft operated by Lessee (or such Permitted Sublessee). In any case, the Aircraft will be maintained in accordance with the maintenance standards required by the FAA (while operated under an FAA-approved maintenance program) or, while operated under the maintenance program of another jurisdiction, standards substantially equivalent to those required by the central aviation authority of Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Spain, Sweden, Switzerland or the United Kingdom. Lessee shall maintain or cause to be maintained all records, logs and other documents required to be maintained in respect of the Aircraft by appropriate authorities in the jurisdiction in which the Aircraft is registered. (d) Insignia. Lessee agrees to affix as promptly as practicable after the Delivery Date and thereafter to maintain in the cockpit of the Aircraft, in a clearly visible location, and (if not prevented by applicable law or regulations or by any government) on each Engine, a nameplate bearing the inscription: Leased From Wells Fargo Bank Northwest, National Association, as Owner Trustee and Lessor, and, for so long as the Airframe and each Engine are subject to the Lien of the Indenture, bearing the following additional inscription: Mortgaged To State Street Bank and Trust Company of Connecticut, National Association, as Loan Trustee (such nameplate to be replaced, if necessary, with a nameplate reflecting the name of any successor Lessor or successor Loan Trustee). Except as above provided, Lessee will not allow the name of any Person to be placed on the Airframe or on any Engine as a designation that might be interpreted as a claim of ownership; provided that nothing in this Section 7(d) shall prohibit Lessee (or any Permitted Sublessee) from placing appropriate lettering, painting and markings (including its customary colors and insignia, and those of any code-sharing partner) on the Airframe or on any Engine. (e) Registration. Lessee shall, forthwith upon delivery of the Aircraft hereunder, cause the Aircraft to be duly registered in the name of Lessor and, subject to the next sentence and Subsection 6.01(f) of the Participation Agreement, remain duly registered, under the laws of the United States in the name of Lessor except as otherwise required by the Transportation Code; provided that Lessor shall, at Lessee's expense, execute and deliver all such documents as Lessee reasonably requests for the purpose of effecting and continuing such registration, and shall not register the Aircraft or permit the Aircraft to be registered under any laws other than the United States at any time except as provided in Section 6.01(f) of the Participation Agreement and shall cause the Indenture to be duly recorded and maintained of record as a first mortgage on the Aircraft. Lessor, upon compliance with all of the terms of Section 6.01(f) of the Participation Agreement, shall, at the request and sole expense of Lessee, cooperate with Lessee to take all actions required to change the registration of the Aircraft to another country. SECTION 8. Replacement and Pooling of Parts; Alterations, Modifications and Additions. (a) Replacement of Parts. Lessee shall promptly replace or cause to be replaced all Parts incorporated or installed in or attached to the Airframe or any Engine and that become worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use for any reason, except as otherwise provided in Section 8(c) or if the Airframe or an Engine to which a Part relates has suffered an Event of Loss. In addition, Lessee (or any Permitted Sublessee) may remove in the ordinary course of maintenance, service, repair, overhaul or testing, any Parts, whether or not worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use; provided that Lessee (or any Permitted Sublessee), except as otherwise provided in Section 8(c), will replace such Parts as promptly as practicable. All replacement Parts shall be free and clear of all Liens (except for Permitted Liens and except in the case of replacement property temporarily installed on an emergency basis) and shall be in the condition and repair required to be maintained by the terms hereof. Except as otherwise provided in Section 8(c), any Parts removed from the Airframe or any Engine shall remain property of Lessor no matter where located until it is replaced by a part incorporated or installed in or attached to the Airframe or such Engine that meets the requirements for replacement Parts specified above. Immediately upon any replacement Part becoming incorporated or installed in or attached to the Airframe or any Engine as above provided (except in the case of replacement property temporarily installed on an emergency basis), without further act, (i) title to such replacement Part shall thereupon vest in Lessor, (ii) such replacement Part shall become subject to this Lease and be deemed part of the Airframe or such Engine for all purposes hereof to the same extent as the Parts originally incorporated or installed in or attached to the Airframe or such Engine, and (iii) title to the replaced Part shall thereupon vest in Lessee (or, if a Sublease is then in effect, any Permitted Sublessee), free and clear of all rights of Lessor, and shall no longer be deemed a Part hereunder. (b) Pooling of Parts. Any Part removed from the Airframe or any Engine as provided in Section 8(a) may be subjected by Lessee or any Person permitted to be in possession of the Aircraft to a pooling arrangement entered into in the ordinary course of Lessee's or such Person's business; provided that the part replacing such removed Part shall be incorporated or installed in or attached to the Airframe or such Engine in accordance with Section 8(a) as promptly as practicable after the removal of such removed Part. In addition, any replacement Part when incorporated or installed in or attached to the Airframe or any Engine may be owned by any third party subject to such a pooling arrangement; provided that Lessee, at its expense, as promptly thereafter as practicable either (i) causes title to such replacement Part to vest in Lessor by Lessee (or any such Person) acquiring title thereto for the benefit of, and transferring such title to, Lessor free and clear of all Liens (except Permitted Liens), or (ii) replaces such replacement Part by incorporating or installing in or attaching to the Airframe or such Engine a further replacement Part owned by Lessee (or any such Person) free and clear of all Liens except Permitted Liens and by causing title to such further replacement Part to vest in Lessor in the manner contemplated by Section 8(a). (c) Alterations, Modifications and Additions. Lessee will make (or cause to be made) such alterations and modifications in and additions to the Airframe and the Engines as are required from time to time to meet the applicable requirements of the FAA or any applicable government of any other jurisdiction in which the Aircraft is then registered; provided, however, that Lessee (or, if a Sublease is then in effect, any Permitted Sublessee) may, in good faith, contest the validity or application of any such requirement in any manner that does not involve any material risk of sale, loss or forfeiture of the Aircraft and does not materially adversely affect Lessor or, so long as any Equipment Notes are outstanding, Loan Trustee. In addition, Lessee (or any Permitted Sublessee), at its own expense, may from time to time add further parts or accessories and make or cause to be made such alterations and modifications in and additions to the Airframe or any Engine as Lessee (or any Permitted Sublessee) deems desirable in the proper conduct of its business, including, without limitation, removal (without replacement) of Parts, provided that no such alteration, modification or addition shall materially diminish the value or utility of the Airframe or such Engine below its value or utility immediately prior to such alteration, modification or addition, assuming that the Airframe or such Engine was then in the condition required to be maintained by the terms of this Lease, except that the value (but not the utility) of the Airframe or any Engine may be reduced by the value of any such Parts that are removed that Lessee deems obsolete or no longer suitable or appropriate for use on the Airframe or any Engine. Title to all Parts incorporated or installed in or attached or added to the Airframe or any Engine as the result of such alteration, modification or addition shall, without further act, vest in Lessor. Notwithstanding the foregoing, Lessee (or any Permitted Sublessee) may, at any time, remove any Part from the Airframe or any Engine if such Part: (i) is in addition to, and not in replacement of or substitution for, any Part originally incorporated or installed in or attached to the Airframe or such Engine at the time of delivery thereof hereunder or any Part in replacement of, or substitution for, any such Part, (ii) is not required to be incorporated or installed in or attached or added to the Airframe or such Engine pursuant to the first sentence of this Section 8(c) and (iii) can be removed from the Airframe or such Engine without materially diminishing the value or utility required to be maintained by the terms of this Lease that the Airframe or such Engine would have had at such time had such removal not occurred. Upon the removal by Lessee (or any Permitted Lessee) of any Part as permitted by this Section 8(c), title to such removed Part shall, without further act, vest in Lessee (or any Permitted Sublessee) and such Part shall no longer be deemed a Part hereunder. Any Part not removed by Lessee (or any Permitted Sublessee) as above provided prior to the return of the Airframe or Engine to Lessor hereunder shall remain the property of Lessor. SECTION 9. Voluntary Termination. (a) Termination Event. (1) Lessee may terminate this Lease on any Lease Period Date occurring on or after the fifth anniversary of the Delivery Date if Lessee has determined, as evidenced by a certificate from a Responsible Officer of Lessee, that the Aircraft is obsolete or surplus to its needs. (2) Lessee shall give Lessor at least ninety (90) days' revocable advance written notice of Lessee's intention to so terminate this Lease (any such notice, a "Termination Notice") specifying the Lease Period Date on which Lessee intends to terminate this Lease in accordance with this Section 9 (such specified date, a "Termination Date"). Any Termination Notice shall become irrevocable if not revoked at least fifteen (15) days prior to the Termination Date. (b) Optional Sale of the Aircraft. If Lessee has so provided a Termination Notice, then during the period from the giving of such notice until the proposed Termination Date (unless Lessee has revoked the Termination Notice specifying such proposed Termination Date), Lessee, as agent for Lessor and at no expense to Lessor, shall use commercially reasonable efforts to obtain in the worldwide market all-cash bids for the purchase of the Aircraft. If it receives any bid, Lessee shall, within five Business Days after receipt thereof and at least ten Business Days prior to the proposed Termination Date, certify to Lessor in writing the amount and terms of each such bid, and the name and address of the party or parties (who shall not be Lessee or any affiliate of Lessee or any Person with whom Lessee or any such affiliate has an arrangement or understanding regarding the future use of the Aircraft by Lessee or any such affiliate but who may be Owner Participant, any affiliate thereof or any Person contacted by Owner Participant) submitting such bid. After Lessee has certified to Lessor all bids received, Owner Participant, any affiliate thereof or any Person contacted by Owner Participant may submit a further bid or bids to Lessee so as to be received not later than ten Business Days prior to the Termination Date proposed by Lessee (unless Lessee shall have revoked the Termination Notice specifying such proposed Termination Date). Subject to the next succeeding sentence, on or before the Termination Date, subject to the release of all mortgage and security interests with respect to the Aircraft under the Indenture: (1) Lessee shall deliver the Aircraft, or cause the Aircraft to be delivered, to the bidder(s), if any, which submitted the highest all-cash bid therefor at least ten Business Days prior to such Termination Date, in the same manner and in the same condition and otherwise in accordance with all the terms of this Lease as if delivery were made to Lessor pursuant to Section 5, and shall duly transfer to Lessor title to any engines not owned by Lessor all in accordance with the terms of Section 5, (2) Lessor shall comply with the terms of the Indenture and shall, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of the Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), subject to prior or concurrent payment by Lessee of all amounts due under clause (3) of this sentence, sell all of Lessor's right, title and interest in and to the Aircraft for cash in Dollars to such bidder(s), the total sales price realized at such sale to be retained by Lessor, and (3) Lessee shall simultaneously pay or cause to be paid to Lessor in funds of the type specified in Section 3(e) hereof, an amount equal to the sum of (A) the excess, if any, of (i) the Termination Value for the Aircraft, computed as of the Termination Date, over (ii) the net cash proceeds from the sale of the Aircraft after deducting the reasonable expenses incurred by Lessor in connection with such sale, (B) all unpaid Basic Rent with respect to the Aircraft payable prior to such Termination Date and all unpaid Supplemental Rent due on or prior to the Termination Date with respect to the Aircraft, and (C) the Make-Whole Amount, if any, due on the Equipment Notes, and upon such payment Lessor simultaneously will transfer to Lessee, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), all of Lessor's right, title and interest in and to any Engines constituting part of the Aircraft which were not sold with the Aircraft. Notwithstanding the preceding sentence, Lessor may, if Lessee has not revoked the Termination Notice, elect to retain title to the Aircraft. If Lessor so elects, Lessor shall notify Lessee of such election at least fifteen Business Days prior to the Termination Date accompanied by an irrevocable undertaking by Owner Participant to make available to Lessor for payment to Loan Trustee on the Termination Date the amount required to pay in full the unpaid principal amount of the Equipment Notes outstanding on the Termination Date plus interest accrued thereon through the Termination Date, together with the Make-Whole Amount, if any, due on the Equipment Notes. Upon receipt of notice of such an election by Lessor and the accompanying undertaking by Owner Participant, Lessee shall cease its efforts to obtain bids as provided above and shall reject all bids theretofore or thereafter received. On the Termination Date, Lessor shall (subject to the payment by Lessee of all Rent due on or prior to such date as set forth below) pay in full the unpaid principal amount of the Equipment Notes outstanding on the Termination Date plus interest accrued thereon through the Termination Date together with all Make-Whole Amount, if any, due on the Equipment Notes and, so long as the Equipment Notes are paid as aforesaid, Lessee shall deliver the Airframe and Engines or engines to Lessor in accordance with Section 5 and shall pay all Basic Rent payable prior to the Termination Date and all Supplemental Rent (other than Termination Value) due on or prior to the Termination Date. If no sale occurs on the Termination Date and Lessor has not made the payment contemplated by the preceding sentence and thereby caused this Lease to terminate, or if Lessee revokes its Termination Notice, this Lease shall continue in full force and effect, Lessee shall pay the actual and reasonable out-of-pocket costs and expenses incurred by Owner Participant and Lessor (unless such failure to terminate this Lease is a consequence of the failure of Lessor or Owner Participant without due cause to make, or cause to be made, the payment referred to in the immediately preceding sentence), if any, in connection with preparation for such sale and Lessee may give one or more additional Termination Notices in accordance with Sections 9(a)(1) and 9(a)(2), subject to the last sentence of this Section 9(b). In the event of any such sale or such retention of the Aircraft by Lessor and upon compliance by Lessee with the provisions of this paragraph, the obligations of Lessee to pay Basic Rent and all other amounts hereunder shall cease to accrue and this Lease shall terminate. Lessor may, but shall be under no duty to, solicit bids or inquire into the efforts of Lessee to obtain bids in connection with any such sale. Lessee may revoke a Termination Notice given pursuant to Section 9(a)(2) no more than four times during the Term. (c) Termination as to Engines. At any time during the Term, so long as no Event of Default has occurred and is continuing, on at least thirty (30) days' prior written notice, Lessee may terminate this Lease with respect to any Engine. Prior to the date of such termination, Lessee shall replace such Engine hereunder by complying with the terms of Section 10(b) to the same extent as if an Event of Loss had occurred with respect to such Engine, and Lessor shall transfer such right, title and interest as it may have to the replaced Engine as provided in Section 5(b). No termination of this Lease with respect to any Engine as contemplated by this Section 9(c) shall result in any reduction of Basic Rent. SECTION 10. Loss, Destruction, Requisition, etc. (a) Event of Loss with Respect to the Aircraft. Upon the occurrence of an Event of Loss with respect to the Airframe or the Airframe and the Engines then installed thereon, Lessee shall as soon as practicable (and, in any event, within 30 days after an Event of Loss has occurred) notify Lessor of such Event of Loss, and, within 90 days after such Event of Loss, Lessee shall notify Lessor of its election to perform one of the following options (it being agreed that if Lessee has not given such notice of election within such 90-day period, Lessee shall be deemed to have elected to perform the option set forth in the following clause (ii)). Lessee may elect either to: (i) substitute, on or before the Loss Payment Date (as defined below), as replacement for the Airframe or Airframe and Engines with respect to which an Event of Loss has occurred, a Replacement Airframe (together with a number of Replacement Engines equal to the number of Engines, if any, with respect to which the Event of Loss occurred); provided that if Lessee has not performed such obligation on or prior to the Loss Payment Date, then Lessee shall on the Loss Payment Date pay to Lessor the amount specified in clause (ii) below; or (ii) on or before the Loss Payment Date, pay or cause to be paid to Lessor in funds of the type specified in Section 3(e) hereof, an amount equal to the Stipulated Loss Value of the Aircraft corresponding to the Stipulated Loss Value Date occurring on or immediately following the Loss Payment Date; provided, however, that if a Lease Period Date occurs prior to the Loss Payment Date with respect to which Stipulated Loss Value is determined, Lessee shall pay on such Lease Period Date an amount equal to the Basic Rent that would have been payable on such Lease Period Date if such Event of Loss had not occurred. The "Loss Payment Date" with respect to an Event of Loss means the earlier of (x) the Business Day next succeeding the 120th day following the date of occurrence of such Event of Loss or (y) an earlier Business Day irrevocably specified at least 15 days in advance by notice from Lessee to Lessor and Loan Trustee. At such time as Lessor shall have received the amounts specified in clause (ii) above, together with all other amounts then due hereunder (including, without limitation, all Basic Rent due before the date of such payment and all Supplemental Rent), under the Participation Agreement and under the Tax Indemnity Agreement, (1) the obligation of Lessee to pay the installments of Basic Rent, Supplemental Rent, Stipulated Loss Value, Termination Value or any other amount shall cease to accrue, (2) this Lease shall terminate, (3) Lessor will comply with the terms of the Indenture and transfer to or at the direction of Lessee, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), all of Lessor's right, title and interest in and to the Airframe and both Engines, and furnish to or at the direction of Lessee a bill of sale in form and substance reasonably satisfactory to Lessee (or any Permitted Sublessee), evidencing such transfer, and (4) Lessee will be subrogated to all claims of Lessor, if any, against third parties, for damage to or loss of the Airframe and any Engines which were subject to such Event of Loss to the extent of the then insured value of the Aircraft. If Lessee elects to substitute a Replacement Airframe (or a Replacement Airframe and one or more Replacement Engines, as the case may be) Lessee shall, at its sole expense, not later than the Loss Payment Date, (A) furnish Lessor with a full warranty bill of sale and an FAA bill of sale, in form and substance reasonably satisfactory to Lessor, evidencing the transfer of title to such Replacement Airframe (or Replacement Airframe and one or more Replacement Engines), (B) cause a Lease Supplement and an Indenture Supplement for such Replacement Airframe and Replacement Engines, if any, to be delivered to Lessor for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of such other jurisdiction in which the Aircraft is then registered, (C) cause a financing statement or statements with respect to the Replacement Airframe and Replacement Engines, if any, or other requisite documents or instruments to be filed in such place or places as are necessary for Lessor to perfect its and Loan Trustee's interest therein and herein in the United States, or in any other jurisdiction in which the Aircraft is then registered, (D) furnish Lessor and Loan Trustee with an opinion of Lessee's counsel (which may be internal counsel of Lessee) addressed to Lessor and Loan Trustee to the effect that upon such replacement, title to such Replacement Airframe and Replacement Engines, if any, will be vested in Lessor and such Replacement Airframe and Replacement Engines, if any, will be subject to the Lien of the Indenture and addressing the matters set forth in clauses (B) and (C), (E) furnish Lessor with a certificate of an independent aircraft engineer or appraiser, certifying that the Replacement Airframe and Replacement Engines, if any, have a value and utility (without regard to hours or cycles) at least equal to the Airframe and Engines, if any, so replaced, assuming the Airframe and such Engines were in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss, (F) furnish Lessor with evidence of compliance with the insurance provisions of Section 11 with respect to such Replacement Airframe and Replacement Engines, if any, and (G) furnish Lessor and Loan Trustee with an opinion of Lessee's counsel (which may be internal counsel of Lessee) to the effect that Lessor and Loan Trustee as assignee of Lessor will be entitled to the benefits of Section 1110 with respect to the Replacement Airframe, provided that (i) such opinion need not be delivered to the extent that the benefits of Section 1110 were not, by reason of a change in law or governmental or judicial interpretation thereof, available to Lessor or Loan Trustee with respect to the Aircraft immediately prior to such substitution and (ii) such opinion may contain qualifications and assumptions of the tenor contained in the Section 1110 opinion of Lessee's special counsel delivered pursuant to Section 3.01 of the Participation Agreement on the Delivery Date and such other qualifications and assumptions as are at the time customary in opinions rendered in comparable circumstances. For all purposes hereof, the property so substituted shall after such transfer be deemed part of the property leased hereunder and shall be deemed an "Aircraft", "Airframe" and "Engine", as the case may be, as defined herein. In the case of title to each Replacement Airframe or Replacement Airframe and one or more Replacement Engines being transferred to Lessor and each Replacement Airframe or Replacement Airframe and one or more Replacement Engines being subjected to the Lien of the Indenture under this Section 10(a), promptly upon the recordation of the Lease Supplement and the Indenture Supplement covering any such Replacement Airframe and Replacement Engines, if any, pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which such Replacement Airframe and Replacement Engines, if any, are registered), Lessee will cause to be delivered to Lessor and Loan Trustee a favorable opinion of FAA counsel selected by Lessee if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Lessee, which counsel shall be reasonably satisfactory to Lessor and Loan Trustee) addressed to Lessor and Loan Trustee as to the due registration of such Replacement Aircraft in the name of Lessor (or other Person if the Aircraft subject to the Event of Loss had been registered in the name of such other Person at the time of the Event of Loss) and the due recordation of such Lease Supplement and Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Aircraft granted to Loan Trustee under the Indenture. Upon compliance with clauses (A) through (G) of the fourth paragraph of this Section 10(a), (i) Lessor shall simultaneously comply with the terms of the Indenture and transfer to or at the direction of Lessee, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), all of Lessor's right, title and interest, if any, in and to the Airframe and any Engines with respect to which such Event of Loss occurred and furnish to or at the direction of Lessee a bill of sale, in form and substance reasonably satisfactory to Lessee, evidencing such transfer and (ii) Lessee will be subrogated to all claims of Lessor, if any, against third parties, for damage to or loss of the Airframe and any Engines which were subject to such Event of Loss. No substitution pursuant to this Section 10(a) shall result in any reduction in Basic Rent. (b) Event of Loss with Respect to an Engine. Upon the occurrence of an Event of Loss with respect to an Engine under circumstances in which there has not occurred an Event of Loss with respect to the Airframe, Lessee shall give Lessor prompt written notice thereof and shall, within 120 days after the occurrence of such Event of Loss, convey or cause to be conveyed to Lessor, as replacement for the Engine with respect to which such Event of Loss occurred, title to a Replacement Engine free and clear of all Liens (other than Permitted Liens). Prior to or at the time of any such conveyance, Lessee will (i) furnish Lessor with a warranty (as to title) bill of sale, in form and substance reasonably satisfactory to Lessor, with respect to such Replacement Engine, (ii) cause a Lease Supplement and an Indenture Supplement covering such Replacement Engine to be delivered to Lessor for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of any other jurisdiction in which the Aircraft is then registered, (iii) cause a financing statement or statements with respect to such Replacement Engine or other requisite documents or instruments to be filed in such place or places as necessary in order to perfect Lessor's and Loan Trustee's interest therein and herein in the United States, or in such other jurisdiction in which the Engine is then registered, (iv) furnish Lessor and Loan Trustee with an opinion of Lessee's counsel (which may be internal counsel to Lessee) addressed to Lessor and Loan Trustee to the effect that, upon such replacement, title to such Replacement Engine will be vested in Lessor and such Replacement Engine will be subject to the Lien of the Indenture, (v) furnish Lessor with a certificate of an aircraft engineer or appraiser (who may be an employee of Lessee) certifying that such Replacement Engine has a value and utility (without regard to hours or cycles) at least equal to the Engine so replaced assuming such Engine was in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss and (vi) furnish Lessor with evidence of compliance with the insurance provisions of Section 11 with respect to such Replacement Engine. For all purposes hereof, the Replacement Engine so substituted shall after such transfer be deemed part of the property leased hereunder and shall be deemed an "Engine" as defined herein. Promptly upon the recordation of the Lease Supplement and the Indenture Supplement covering such Replacement Engine pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which the Aircraft is registered), Lessee will cause to be delivered to Lessor and Loan Trustee an opinion of FAA counsel selected by Lessee if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Lessee, which counsel shall be reasonably satisfactory to Lessor and Loan Trustee) addressed to Lessor and Loan Trustee as to the due recordation of such Lease Supplement and such Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Engine granted to Loan Trustee under the Indenture. Upon compliance with clauses (i) through (vi) of the second sentence of this paragraph, Lessor will comply with the terms of the Indenture and transfer to or at the direction of Lessee without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) all of Lessor's right, title and interest, if any, in and to (A) the Engine with respect to which such Event of Loss occurred and furnish to or at the direction of Lessee a bill of sale in form and substance reasonably satisfactory to Lessee, evidencing such transfer and (B) all claims, if any, against third parties, for damage to or loss of the Engine subject to such Event of Loss, and such Engine shall thereupon cease to be an Engine leased hereunder. No substitution pursuant to this Section 10(b) shall result in any reduction in Basic Rent. (c) Application of Payments for Event of Loss from Requisition of Title or Use. Any payments other than insurance proceeds (the application of which is provided for in Section 11) received at any time by Lessor or by Lessee from any government or other Person with respect to an Event of Loss to the Airframe or any Engine, will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Lessee pursuant to Section 10(a), such payments shall be paid over to, or retained by, Lessor and upon completion of such replacement shall be paid over to, or retained by, Lessee; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced pursuant to Section 10(a), after reimbursement of Lessor (as provided in Section 7.01 of the Trust Agreement) for actual and reasonable out-of-pocket costs and expenses, so much of such payments remaining as shall not exceed the Stipulated Loss Value required to be paid by Lessee pursuant to Section 10 (a) shall be applied in reduction of Lessee's obligation to pay the Stipulated Loss Value, if not already paid by Lessee, or, if already paid by Lessee, shall be applied to reimburse Lessee for its payment of the Stipulated Loss Value, and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Lessee; provided that Lessor shall be entitled to so much of the excess, if any, of such payment over the greater of (x) the Stipulated Loss Value and (y) the fair market value of the Aircraft as Lessor shall demonstrate to Lessee's reasonable satisfaction is attributable to compensation for loss of Lessor's interest in the Aircraft as distinguished from the loss of use of the Aircraft; and (iii) if such payments are received with respect to an Engine with regard to which an Event of Loss has occurred, so much of such payments remaining after reimbursement of Lessor (as provided in Section 7.01 of the Trust Agreement) for actual and reasonable out-of-pocket costs and expenses shall be paid over to, or retained by, Lessee; provided that Lessee has fully performed its obligations under Section 10(b) with respect to the Event of Loss for which such payments are made (d) Requisition for Use by the Government of the Airframe and the Engines Installed Thereon. In the event of the requisition for use by any government during the Term (it being acknowledged that the use of the Airframe or any Engine pursuant to the CRAF Program does not constitute such a requisition) of the Airframe and the Engines or engines installed on the Airframe that does not constitute an Event of Loss, Lessee shall promptly notify Lessor of such requisition, and all of Lessee's rights and obligations under this Lease with respect to the Airframe and such Engines shall continue to the same extent as if such requisition had not occurred; provided that, notwithstanding the foregoing, Lessee's obligations other than payment obligations shall only continue to the extent feasible. If such Airframe and Engines or engines installed thereon are not returned by such government prior to the end of the Term, Lessee shall be obligated to return the Airframe and such Engines or engines to Lessor pursuant to, and in all other respects in compliance with the provisions of, Section 5 promptly upon the date of such return by such government. If, in the event of any such requisition, Lessee fails to return the Aircraft on or before the thirtieth day beyond the end of the Term, such failure shall constitute an Event of Loss which shall be deemed to have occurred on the last day of the Term and in such event Lessee shall make the payment contemplated by Section 10(a)(ii) in respect of such Event of Loss; provided, however, that Lessor may notify Lessee in writing on or before the twentieth day prior to the last day of the Term that, in the event Lessee shall fail by reason of such requisition to return the Airframe and such Engines or engines on or before the thirtieth day beyond the end of the Term, such failure shall not be deemed an Event of Loss. Upon the giving of such notice and such failure to return by the thirtieth day beyond the end of the Term, Lessee shall be relieved of all of its obligations pursuant to the provisions of Section 5 (including Exhibit J to the Participation Agreement) but not under any other Section. If any engine not owned by Lessor is then installed on the Airframe, Lessee will, at no cost to Lessor, furnish, or cause to be furnished, to Lessor a full warranty (as to title) bill of sale with respect to each such engine, in form and substance reasonably satisfactory to Lessor (together with an opinion of counsel to the effect that such full warranty bill of sale has been duly authorized and delivered and is enforceable in accordance with its terms and that such engines are free and clear of Liens other than Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), Noteholder Liens and Loan Trustee Liens), against receipt from Lessor of a bill of sale evidencing the transfer, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), by Lessor to Lessee or its designee of all of Lessor's right, title and interest in and to any Engine constituting part of the Aircraft but not then installed on the Airframe. All payments received by Lessor or Lessee from such government for the use of such Airframe and Engines or engines during the Term shall be paid over to, or retained by, Lessee (or, if directed by Lessee, any Permitted Sublessee). All payments received by Lessor or Lessee from such government for the use of such Airframe and Engines or engines after the end of the Term shall be paid over to, or retained by, Lessor unless Lessee shall have exercised its purchase option hereunder, in which case such payments shall be made to Lessee. (e) Requisition for Use by the Government of an Engine not Installed on the Airframe. If any government requisitions the use, for a period in excess of sixty (60) days, of any Engine not then installed on the Airframe, Lessee will replace such Engine by complying with the terms of Section 10(b) to the same extent as if an Event of Loss had occurred with respect to such Engine. Upon such replacement, any payments received by Lessee or Lessor from such government with respect to such requisition shall be paid over to, or retained by, Lessee. (f) Application of Payments During Existence of Event of Default. Any amount referred to in this Section 10 that is payable to or retainable by Lessee shall not be paid to or retained by Lessee if at the time of such payment or retention an Event of Default or Payment Default has occurred and is continuing, but shall be held by or paid over to Lessor as security for the obligations of Lessee under this Lease. When any such Event of Default or Payment Default ceases, such amount shall be paid to Lessee. SECTION 11. Insurance. (a) Aircraft Liability Insurance. (i) Except as provided in clause (ii) of this subsection (a), and subject to the rights of Lessee to establish and maintain self-insurance in the manner and to the extent specified in Section 11(c), Lessee will carry, or cause to be carried, at no expense to Lessor, aircraft liability insurance (including, but not limited to, bodily injury, personal injury and property damage liability, exclusive of manufacturer's product liability insurance) and contractual liability insurance with respect to the Aircraft (A) in amounts that are not less than the aircraft liability insurance applicable to similar aircraft and engines in Lessee's fleet on which Lessee carries insurance; provided that such liability insurance shall not be less than the amount certified in the insurance report delivered to Lessor and Loan Trustee on the Delivery Date, (B) of the type covering the same risks as from time to time applicable to aircraft operated by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) of the same type as the Aircraft, and (C) that is maintained in effect with insurers of recognized responsibility. Any policies of insurance carried in accordance with this Section 11(a) and any policies taken out in substitution or replacement for any of such policies shall: (A) name Lessor, in its individual capacity and as owner trustee, Loan Trustee, Subordination Agent, each Pass Through Trustee, Owner Participant, Policy Provider and Liquidity Provider (but without imposing on any such parties liability to pay the premiums for such insurance) (and, if any Sublease is then in effect, Lessee in its capacity as sublessor under such Sublease) as their Interests (as defined below in this Section 11) may appear, as additional insured (the "Additional Insureds"), (B) subject to the condition of clause (C) below, provide that, in respect of the interest of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Lessee or any other Person and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by Lessee, (C) provide that, if such insurance is canceled for any reason whatever, or if any change is made in the policy that materially reduces the amount of insurance or the coverage certified in the insurance report delivered on the Delivery Date to Lessor, Loan Trustee, Owner Participant, Policy Provider and Liquidity Provider, or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to any Additional Insured for 30 days (seven days, or such other period as is then generally available in the industry, in the case of any war risk or allied perils coverage) after receipt by such Additional Insured of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive any rights of (1) set-off, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent that Lessee has waived its rights by its agreements to indemnify the Additional Insureds pursuant to the Operative Documents, (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft and (G) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covering each insured. "Interests" as used in this Section 11(a) and in Section 11(b) with respect to any Person means the interests of such Person in the transactions contemplated by the Operative Documents. In the case of a sublease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Lessee, or an insurance policy issued by such government, against any of the risks that Lessee is required to insure against hereunder shall be considered adequate insurance for purposes of this Section 11(a) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine, as the case may be, is on the ground and not being flown, Lessee may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Subsection 11(c), insurance otherwise conforming with the provisions of said clause (i) except that: (A) the amounts of coverage shall not be required to exceed the amounts of airline liability insurance from time to time applicable to airframes or engines owned or leased by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown and (B) the scope of the risks covered and the type of insurance shall be the same as from time to time are applicable to airframes or engines operated by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown. (b) Insurance Against Loss or Damage to Aircraft. (i) Except as provided in clause (ii) of this subsection (b), and subject to the rights of Lessee to establish and maintain self-insurance in the manner and to the extent specified in Section 11(c), Lessee shall maintain, or cause to be maintained, in effect with insurers of recognized responsibility, at no expense to Lessor, all-risk aircraft hull insurance covering the Aircraft and all-risk coverage with respect to any Engines or Parts while removed from the Aircraft (including, without limitation, war risk insurance if and to the extent the same is maintained by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) with respect to other similar aircraft operated by Lessee or such Permitted Sublessee, as the case may be, on the same routes) that is of the type as from time to time applicable to the aircraft operated by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) of the same type as the Aircraft; provided that (A) such insurance (including the permitted self-insurance) shall at all times while the Aircraft is subject to this Lease be for an amount not less than the Stipulated Loss Value for the Aircraft, (B) such insurance need not cover an Engine while attached to an airframe not owned, leased or operated by Lessee, and (C) such insurance covering Engines and Parts removed from an Airframe or an airframe or (in the case of Parts) an Engine need be obtained only to the extent available at reasonable cost (as reasonably determined by Lessee). Any policies carried in accordance with this Section 11(b) and any policies taken out in substitution or replacement for any such policies shall: (A) provide that any insurance proceeds up to an amount equal to the Stipulated Loss Value for the Aircraft payable for any loss or damage constituting an Event of Loss with respect to the Aircraft and any insurance proceeds in excess of the amount set forth on Exhibit F up to an amount equal to the Stipulated Loss Value for the Aircraft for any loss or damage to the Aircraft (or Engines) not constituting an Event of Loss with respect to the Aircraft (or Engines), shall be paid to Lessor (or, as long as the Indenture has not been discharged, Loan Trustee) and that all other amounts shall be payable to Lessee, unless the insurer has received notice that an Event of Default exists, in which case all insurance proceeds for any loss or damage to the Aircraft (or Engines) up to an amount equal to the Stipulated Loss Value for the Aircraft shall be payable to Lessor (or, as long as the Indenture has not been discharged, Loan Trustee), (B) subject to the conditions of clause (C) below, provide that, in respect of the interests of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Lessee or any other Person and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation by Lessee of any warranty, declaration or condition contained in such policies, (C) provide that if such insurance is canceled for any reason, or if any change is made in the insurance that materially reduces the coverage (not including the amount) certified in the insurance report delivered on the Delivery Date to Lessor and Loan Trustee or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to the Additional Insureds for 30 days (seven days, or such other period as is customarily available in the industry, in the case of war risk or allied perils coverage) after receipt by the Additional Insureds of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive rights of (1) setoff, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent Lessee has waived its rights by its agreement to indemnify the Additional Insureds pursuant to the Operative Documents and (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft. In the case of a sublease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Lessee, or an insurance policy issued by such government, against any risks which Lessee is required hereunder to insure against shall be considered adequate insurance for purposes of this Section 11(b) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine is on the ground and not being flown, Lessee may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Section 11(c), insurance otherwise conforming with the provisions of said clause (i) except that the scope of the risks covered and the type of insurance shall be the same as from time to time applicable to airframes and engines operated by Lessee (or, if a Sublease is then in effect, by the Permitted Sublessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown; provided that, subject to self-insurance to the extent permitted by Section 11(c), Lessee shall maintain or cause to be maintained insurance against risk of loss or damage to such non-flown Airframe or Engine in an amount at least equal to the Stipulated Loss Value for the Aircraft. (c) Self-Insurance. Lessee may from time-to-time self-insure, by way of deductible, self-insured retention, premium adjustment or franchise or otherwise (including, with respect to insurance maintained pursuant to Sections 11(a) or 11(b), insuring for a maximum amount that is less than the amounts set forth in Sections 11(a) and 11(b)), the risks required to be insured against pursuant to Sections 11(a) and 11(b), but in no case shall the self-insurance with respect to all of the aircraft and engines in Lessee's fleet (including, without limitation, the Aircraft) exceed for any 12-month policy year 1% of the average aggregate insurable value (for the preceding policy year) of all aircraft (including, without limitation, the Aircraft) on which Lessee carries insurance, unless an insurance broker of national standing certifies that the standard among other major United States airlines is a higher level of self-insurance, in which case Lessee may self-insure the Aircraft to such higher level. In addition to the foregoing right to self-insure, Lessee may self-insure to the extent of (1) any deductible per occurrence that, in the case of the Aircraft, is not in excess of the amount customarily allowed as a deductible in the industry or is required to facilitate claims handling or (2) any applicable mandatory minimum per aircraft (or if applicable per annum or other period) hull or liability insurance deductibles imposed by the aircraft hull or liability insurers. (d) Application of Insurance Payments. All losses will be adjusted by Lessee with the insurers. As between Lessor and Lessee it is agreed that all insurance payments received under policies required to be maintained by Lessee hereunder, exclusive of any payments received in excess of the Stipulated Loss Value for the Aircraft from such policies, as the result of the occurrence of an Event of Loss with respect to the Airframe or an Engine will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Lessee pursuant to Section 10(a), such payments shall be paid over to, or retained by, Lessor and upon completion of such replacement shall be paid over to, or retained by, Lessee; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced as contemplated by Section 10(a), after reimbursement of Lessor (as provided in Section 7.01 of the Trust Agreement) for actual and reasonable out-of-pocket costs and expenses, so much of such payments remaining as do not exceed the Stipulated Loss Value required to be paid by Lessee pursuant to Section 10(a) shall be applied in reduction of Lessee's obligation to pay the Stipulated Loss Value, if not already paid by Lessee, or, if already paid by Lessee, shall be applied to reimburse Lessee for its payment of the Stipulated Loss Value and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Lessee; and (iii) if such payments are received with respect to an Engine, so much of such payments remaining after reimbursement of Lessor (as provided in Section 7.01 of the Trust Agreement) for actual and reasonable out-of-pocket costs and expenses shall be paid over to, or retained by, Lessee; provided that Lessee has fully performed its obligations under Section 10(b) with respect to the Event of Loss for which such payments are made. In all events, the insurance payment of any property damage loss received under policies maintained by Lessee in excess of the Stipulated Loss Value for the Aircraft shall be paid to Lessee. The insurance payments for any loss or damage to the Airframe or an Engine not constituting an Event of Loss with respect to the Airframe or such Engine will be applied in payment (or to reimburse Lessee) for repairs or for replacement property in accordance with the terms of Sections 7 and 8, and any balance remaining after compliance with such Sections with respect to such loss or damage shall be paid to Lessee. Any amount referred to in the preceding sentence or in clause (i), (ii) or (iii) of the first paragraph of this Section 11(d) that is payable to Lessee shall not be paid to Lessee (or, if it has been previously paid directly to Lessee, shall not be retained by Lessee) if at the time of such payment an Event of Default or Payment Default has occurred and is continuing, but shall be paid to and held by Lessor as security for the obligations of Lessee under this Lease, and when any such Event of Default or Payment Default ceases, such amount shall, to the extent not theretofore applied as provided herein, be paid to Lessee. (e) Reports, Etc. On or before the Delivery Date and annually following renewal of Lessee's insurance coverage, Lessee will furnish to Lessor, Loan Trustee, Owner Participant, Policy Provider and Liquidity Provider a report signed by a firm of independent aircraft insurance brokers appointed by Lessee (which brokers may be in the regular employ of Lessee), stating the opinion of such firm that the insurance then carried and maintained on the Aircraft complies with the terms hereof. All information contained in such report shall be Confidential Information and shall be treated by Lessor, Loan Trustee, Owner Participant, Policy Provider and Liquidity Provider and each of their affiliates and officers, directors, agents and employees in accordance with the provisions of Section 6.01(i) of the Participation Agreement. Lessee will cause such firm to notify Lessor, Loan Trustee, Owner Participant, Policy Provider and Liquidity Provider of any act or omission on the part of Lessee of which such firm has knowledge that might invalidate or render unenforceable, in whole or in part, any insurance on the Aircraft. Lessee will also cause such firm to notify Lessor, Loan Trustee, Owner Participant, Policy Provider and Liquidity Provider as promptly as practicable after such firm acquires knowledge that an interruption of any insurance carried and maintained on the Aircraft pursuant to this Section 11 will occur. Such information may only be provided to other Persons in accordance with Section 6.01(i) of the Participation Agreement. (f) Salvage Rights; Other. All salvage rights to the Airframe and each Engine shall remain with Lessee's insurers at all times, and any insurance policies of Loan Trustee, Lessor or Owner Participant insuring the Airframe or any Engine shall provide for a release to Lessee of any and all salvage rights in and to the Airframe or any Engine. Neither Lessor, Owner Participant, Loan Trustee nor any Noteholder may, directly or indirectly, obtain insurance for its own account with respect to the Airframe or any Engine if such insurance would limit or otherwise adversely affect the coverage or amounts payable under, or increase the premiums for, any insurance required to be maintained pursuant to this Section 11 or any other insurance maintained with respect to the Aircraft or any other aircraft in Lessee's fleet. SECTION 12. Inspection. At all reasonable times and upon at least 15 Business Days' prior written notice to Lessee, Lessor, Owner Participant, Policy Provider or Loan Trustee or their respective authorized representatives may, subject to the other conditions of this Section 12, inspect the Aircraft and may inspect the books and records of Lessee relating to the maintenance of the Aircraft required to be maintained by the FAA or the government of another jurisdiction in which the Aircraft is then registered; provided, that (i) Lessor, Owner Participant, Policy Provider, Loan Trustee or their respective representatives, as the case may be, shall be fully insured at no cost to Lessee in a manner satisfactory to Lessee with respect to any risks incurred in connection with any such inspection or shall provide to Lessee a written release satisfactory to Lessee with respect to such risks, (ii) any such inspection shall be during Lessee's normal business hours and subject to the safety, security and workplace rules applicable at the location where such inspection is conducted and any applicable governmental rules or regulations, (iii) any such inspection of the Aircraft shall be a visual, walk-around inspection of the interior and exterior of the Aircraft and shall not include opening any panels, bays or the like without Lessee's express consent, which consent Lessee may in its sole discretion withhold, and (iv) no exercise of such inspection right shall interfere with the use, operation or maintenance of the Aircraft by, or the business of, Lessee and Lessee shall not be required to undertake or incur any additional liabilities in connection therewith. All information obtained in connection with any such inspection of the Aircraft and of such books and records shall be Confidential Information and shall be treated by Lessor, Owner Participant, Policy Provider and Loan Trustee and their respective representatives in accordance with the provisions of Section 6.01(i) of the Participation Agreement. Any inspection pursuant to this Section 12 shall be at the sole risk (including, without limitation, any risk of personal injury or death) and expense of Lessor, Owner Participant, Policy Provider or Loan Trustee (or their respective representatives) making such inspection. Except during the continuance of an Event of Default, all inspections by Lessor, Owner Participant, Policy Provider and Loan Trustee and their respective representatives provided for under this Section 12 shall be limited to one inspection of any kind contemplated by this Section 12 during any consecutive twelve month period. In addition, during the last six (6) months of the Term (unless Lessee has elected to purchase the Aircraft or renew this Lease), with reasonable notice, Lessee will cooperate, and cause any Permitted Sublessee to cooperate, at Lessor's sole cost, in all reasonable respects with the efforts of Lessor to sell or lease the Aircraft, including, without limitation, permitting prospective purchasers or lessees to inspect the Aircraft and the books and records of Lessee specified above pursuant to the preceding provisions of this Section 12. None of Lessor, Owner Participant, Policy Provider or Loan Trustee shall have any duty to make any inspection nor shall any of them incur any liability or obligation by reason of not making such inspection. SECTION 13. Assignment. Except as otherwise provided herein, Lessee will not, without prior written consent of Lessor, assign in whole or in part any of its rights or obligations hereunder. Lessor agrees that it will not assign or convey its right, title and interest in and to this Lease or the Aircraft except as provided herein, in the Trust Agreement or in the Participation Agreement. Subject to the foregoing, the terms and provisions of this Lease shall be binding upon and inure to the benefit of Lessor and Lessee and their respective successors and permitted assigns. SECTION 14. Events of Default. Each of the following events constitutes an Event of Default (whether any such event is voluntary or involuntary or comes about or is effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body) and each such Event of Default shall continue so long as, but only as long as, it has not been remedied or explicitly waived: (a) Lessee fails to make any payment of Basic Rent or Stipulated Loss Value within 15 days after such payment is due; (b) Lessee fails to make payment when the same is due of any Supplemental Rent (other than Stipulated Loss Value) due hereunder, and such failure continues unremedied for 30 days after the receipt by Lessee of written notice thereof from the party entitled thereto (provided that any failure to pay any amount owed by Lessee under the Tax Indemnity Agreement or any failure of Lessee to pay to Lessor or Owner Participant when due any Excluded Payments shall not constitute an Event of Default unless notice is given by Owner Participant to Lessee and Loan Trustee that such failure constitutes an Event of Default); (c) Lessee fails to carry and maintain insurance or indemnity on or with respect to the Aircraft in accordance with the provisions of Section 11; provided that no such failure to carry and maintain insurance shall constitute an Event of Default until the earlier of (i) the date such failure has continued unremedied for a period of 30 days after receipt by Lessor of the notice of cancellation or lapse referred to in Section 11 or (ii) the date such insurance is not in effect as to Lessor, Loan Trustee, Owner Participant and Liquidity Provider; (d) Lessee fails to perform or observe any other covenant, condition or agreement (except the covenants set forth in the Tax Indemnity Agreement and in paragraphs 2 and 3 of Exhibit J to the Participation Agreement) to be performed or observed by it under any Operative Document, and such failure continues unremedied for a period of 60 days after receipt by Lessee of written notice thereof from Lessor or Loan Trustee; provided that, if such failure is capable of being remedied, no such failure shall constitute an Event of Default for a period of one year after such notice is received by Lessee so long as Lessee is diligently proceeding to remedy such failure; (e) any representation or warranty made by Lessee in any Operative Document (except the representations and warranties set forth in Section [3] of the Tax Indemnity Agreement) was incorrect in any material respect at the time made, and such incorrectness continues to be material to the transactions contemplated hereby and continues unremedied for a period of 60 days after receipt by Lessee of written notice thereof from Lessor or Loan Trustee; provided that, if such incorrectness is capable of being remedied, no such incorrectness shall constitute an Event of Default for a period of one year after such notice is received by Lessee so long as Lessee is diligently proceeding to remedy such incorrectness; (f) Lessee consents to the appointment of or the taking of possession by a receiver, trustee or liquidator in respect of a substantial part of its property, admits in writing its inability to pay its debts generally as they come due or makes a general assignment for the benefit of its creditors; (g) Lessee files a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief as a debtor in a case under any bankruptcy laws or insolvency laws (as in effect at such time) or an answer admitting the material allegations of a petition filed against Lessee as a debtor in any such case, or Lessee as a debtor seeks 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 Lessee seeks an agreement, composition, extension or adjustment with its creditors under such laws; (h) an order, judgment or decree is entered by any court of competent jurisdiction appointing, without the consent of Lessee, a receiver, trustee or liquidator of Lessee or sequestering any substantial part of its property, or granting any other relief in respect of Lessee as a debtor under any bankruptcy laws or insolvency laws (as in effect at such time), and any such order, judgment or decree of appointment or sequestration remains in force undismissed, unstayed or unvacated for a period of 90 days after the date of entry thereof; or (i) a petition against Lessee as a debtor in a case under the federal bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within 90 days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of corporations that may apply to Lessee, any court of competent jurisdiction assumes jurisdiction, custody or control of Lessee or of any substantial part of its property and such jurisdiction, custody or control remains in force unrelinquished, unstayed or unterminated for a period of 90 days provided, however, that notwithstanding anything to the contrary contained in this Section 14, any failure of Lessee to perform or observe any covenant, condition or agreement shall not constitute an Event of Default if such failure arises by reason of an event referred to in the definition of "Event of Loss" so long as Lessee is continuing to comply with all of the terms of Section 10. SECTION 15. Remedies. If an Event of Default has occurred and is continuing and so long as the same continues unremedied, then and in every such case Lessor may, at its option, declare by written notice to Lessee this Lease to be in default, provided, that if an Event of Default referred to in Section 14(f), (g), (h) or (i) has occurred, this Lease shall be deemed to be declared in default without further act; and at any time thereafter, Lessor may do one or more of the following to the extent permitted by, and subject to compliance with the requirements of, applicable law then in effect (provided, however, that during any period the Airframe or any Engine is subject to the CRAF Program and is in possession of or being operated under the direction of the United States government or an agency or instrumentality of the United States, Lessor shall not, on account of any Event of Default, be entitled to exercise or pursue any of the powers, rights or remedies described in this Section 15 in such manner as to limit Lessee's control under this Lease (or any Permitted Sublessee's control under any Sublease) of the Airframe or such Engine, unless at least 60 days' (or such lesser period as may then be applicable under the Military Airlift Command Program of the United States government) prior written notice of default hereunder has been given by Lessor by registered or certified mail to Lessee (and any such Permitted Sublessee) with a copy addressed to the Contracting Office Representative or other appropriate person for the Military Airlift Command of the United States Air Force under any contract with Lessee (or such Permitted Sublessee) relating to the Aircraft): (a) cause Lessee, upon the demand by notice of Lessor, at Lessee's expense, to deliver promptly, and Lessee shall deliver promptly, all or such part of the Airframe or any Engine as Lessor so demands to Lessor or its order in the manner and condition required by, and otherwise in accordance with all the provisions of Section 5 as if such Airframe or Engine were being returned at the end of the Term, or, if Lessee has failed to so deliver the Airframe or any Engine after such demand, Lessor, at its option, may enter upon the premises where all or any part of the Airframe or any Engine are located and take immediate possession of and remove the same together with any engine which is not an Engine but which is installed on the Airframe, subject to all of the rights of the owner, lessor, lienor or secured party of such engine; provided that the Airframe with an engine (which is not an Engine) installed thereon may be flown or returned only to a location within the continental United States, and such engine shall be held for the account of any such owner, lessor, lienor, secured party or, if such engine is owned by Lessee, may at the option of Lessee with the consent of Lessor (which will not be unreasonably withheld) or at the option of Lessor with the consent of Lessee (which will not be unreasonably withheld), be exchanged with Lessee for an Engine in accordance with the provisions of Section 10(b); (b) sell all or any part of the Airframe and any Engine at public or private sale, whether or not Lessor at the time has possession thereof, as Lessor may determine, or otherwise dispose of, hold, use, operate, lease to others or keep idle all or any part of the Airframe or such Engine as Lessor, in its sole discretion, determines, all free and clear of any rights or claims of Lessee, except as hereinafter set forth in this Section 15; (c) whether or not Lessor has exercised, or thereafter at any time exercises, any of its rights under paragraph (a) or paragraph (b) above with respect to the Airframe and/or any Engine, Lessor, by written notice to Lessee specifying a payment date which shall be the Lease Period Date not earlier than ten days from the date of such notice, may demand that Lessee pay to Lessor, and Lessee shall pay Lessor, on the payment date so specified, as liquidated damages for loss of a bargain and not as a penalty (in lieu of the installments of Basic Rent for the Aircraft due for Lease Periods commencing on or after the Delivery Date or the Lease Period Date specified as the payment date in such notice), any unpaid Basic Rent specified in Exhibit B-1 as payable on Lease Period Dates prior to the payment date so specified (including, in each case, without limitation, any adjustments to Basic Rent payable pursuant to Section 3(c)) plus whichever of the following amounts Lessor, in its sole discretion, specifies in such notice (together with interest, if any, on such amount at the Past Due Rate from such specified payment date until the date of actual payment of such amount): (i) an amount equal to the excess, if any, of the Stipulated Loss Value for the Aircraft, computed as of the Lease Period Date specified as the payment date in such notice, over the aggregate fair market rental value (computed provided as in this Section 15) of such Aircraft for the remainder of the Term, after discounting such aggregate fair market rental value to present value as of the Lease Period Date specified as the payment date in such notice at an annual rate equal to the Base Rate plus 1%; or (ii) an amount equal to the excess, if any, of the Stipulated Loss Value for the Aircraft, computed as of the Lease Period Date specified as the payment date in such notice, over the fair market sales value of such Aircraft (computed provided as in this Section 15) as of the Lease Period Date specified as the payment date in such notice; (d) if Lessor, pursuant to paragraph (b) above, has sold the Airframe and/or any Engine, Lessor, in lieu of exercising its rights under paragraph (c) above with respect to the Aircraft, may, if it so elects, demand that Lessee pay Lessor, and Lessee shall pay to Lessor, on the date of such sale, as liquidated damages for loss of a bargain and not as a penalty (in lieu of the installments of Basic Rent for the Aircraft due on or after such date), any unpaid Basic Rent with respect to the Aircraft specified in Exhibit B-1 as payable prior to such date (including, in each case, without limitation, any adjustments to Basic Rent payable pursuant to Section 3(c)) plus the amount of any deficiency between the net proceeds of such sale (after deduction of all actual and reasonable out-of-pocket costs of sale) and the Stipulated Loss Value for the Aircraft, computed as of the Stipulated Loss Value Date on or immediately preceding the date of such sale together with interest, if any, on the amount of such deficiency, at the Past Due Rate, from the date of such sale to the date of actual payment of such amount; and/or (e) Lessor may rescind, terminate or cancel this Lease as to the Aircraft, and/or may exercise any other right or remedy which may be available to it under applicable law or proceed by appropriate court action to enforce the terms hereof or to recover damages for breach hereof. For the purposes of paragraph (c) above, the "fair market rental value" or the "fair market sales value" of the Aircraft shall be the rental value or sales value which would be obtained in an arm's-length transaction between an informed and willing lessee or purchaser under no compulsion to lease or purchase and an informed and willing lessor or seller in possession under no compulsion to sell, in each case based upon the actual condition and location of the Aircraft, which value shall be determined by mutual written agreement. In the absence of mutual written agreement, such value shall be determined pursuant to an appraisal prepared and delivered by a nationally recognized firm of independent aircraft appraisers nominated by Lessor, and Lessor shall immediately notify Lessee of such nomination. Lessee may object to such nomination by notice within ten days after its receipt of Lessor's notice. If Lessee does not so object, Lessor's nomination shall be conclusive and binding. If Lessee objects, Lessor and Lessee shall endeavor, within ten days after such objection is made, to select a mutually acceptable appraiser; provided that, if Lessee does not so endeavor to make such selection, Lessor's nomination referred to above shall be conclusive and binding. If Lessor and Lessee fail to reach agreement (except for the reason referred to in the proviso in the preceding sentence), or if any appraiser selected fails to act for any reason, then the question shall be determined by an appraisal (applying the definitions of "fair market rental value" and "fair market sales value" as set forth above based upon the actual condition of the Aircraft) mutually agreed to by two recognized independent aircraft appraisers, one of which appraisers shall be chosen by Lessor and one by Lessee within five Business Days after Lessor or Lessee has received written notice from the other party of a demand that such an appraisal be made, which notice shall specify the appraiser chosen by the party giving the notice or, if such appraisers cannot agree on the amount of such appraisal within twenty Business Days after the end of such five-day period, each shall render its own appraisal and shall by mutual consent choose another appraiser within five Business Days after the end of such twenty-day period. If, within such five-day period, such two appraisers fail to appoint a third appraiser, then either Lessor or Lessee, on behalf of both, may request such appointment by the then President of the Association of the Bar of the City of New York (or any successor organization thereto) or, in his absence, failure, refusal or inability to act, then either Lessor or Lessee may apply to the American Arbitration Association (or any successor organization thereto) in New York, New York for the appointment of such third appraiser. The decision of the third appraiser so appointed shall be given within twenty Business Days after the appointment of such third appraiser. As soon as the third appraiser has delivered its appraisal, that appraisal shall be compared with the appraisals given by the other two appraisers. If the determination of one appraiser is more disparate from the average of all three determinations than each of the other two determinations, then the determination of such appraiser shall be excluded, the remaining two determinations shall be averaged and such average shall be final and binding upon the parties hereto. If no determination is more disparate from the average of all three determinations than each of the other determinations, then such average shall be final and binding upon the parties thereto. The actual and reasonable out-of-pocket cost of such appraisal or appointment shall be borne by Lessee. In addition, Lessee shall be liable, except as otherwise provided above and without duplication of amounts payable hereunder, for any and all unpaid Rent due hereunder before, after or during the exercise of any of the foregoing remedies and for all reasonable legal fees and other actual and reasonable costs and expenses (including fees of the appraisers referred to above) incurred by Lessor, Loan Trustee, Noteholders and Owner Participant in connection with the return of the Airframe or any Engine in accordance with the terms of Section 5 or in placing such Airframe or Engine in the condition required by such Section. At any sale of the Aircraft or any part thereof pursuant to this Section 15, Lessor (or Loan Trustee, any Noteholder or Owner Participant) or Lessee may bid for and purchase such property. Lessor agrees to give Lessee at least 30 days' prior written notice of the date fixed for any public sale of the Airframe or any Engine or of the date on or after which any private sale will be held, which notice Lessee hereby agrees to the extent permitted by applicable law is reasonable notice, and any such public sale shall be conducted in general so as to afford Lessee (and any Permitted Sublessee) a reasonable opportunity to bid. Except as otherwise expressly provided above, no remedy referred to in this Section 15 is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to above or otherwise available to Lessor at law or in equity; and the exercise or beginning of exercise by Lessor of any one or more of such remedies shall not preclude the simultaneous or later exercise by Lessor of any or all of such other remedies. No waiver by Lessor of any Event of Default shall in any way be, or be construed to be, a waiver of any future or subsequent Event of Default. SECTION 16. Lessee's Cooperation Concerning Certain Matters. Forthwith upon the execution and delivery of each Lease Supplement and Indenture Supplement from time to time as required by the terms hereof and upon the execution and delivery of any amendment to this Lease, to the Indenture or to the Trust Agreement, Lessee will cause such Lease Supplement, Indenture Supplement (and, in the case of the initial Lease Supplement and Indenture Supplement, this Lease, the Trust Agreement and the Indenture as well) or amendment to be duly filed and recorded, and maintained of record, in accordance with the applicable laws of the government of registry of the Aircraft. In addition, Lessee will promptly and duly execute and deliver to Lessor such further documents and take such further action as Lessor or Loan Trustee may from time to time reasonably request in order more effectively to carry out the intent and purpose of this Lease and to establish and protect the rights and remedies created or intended to be created in favor of Lessor and Loan Trustee hereunder, including, without limitation, if requested by Lessor or Loan Trustee, at the expense of Lessee, the execution and delivery of supplements or amendments hereto or to the Indenture, each in recordable form, subjecting to this the Lease and the Indenture, any airframe or engine substituted for the Airframe or any Engine pursuant to the terms thereof and the recording or filing of counterparts thereof, in accordance with the laws of such jurisdictions as Lessor or Loan Trustee may from time to time deem advisable. Lessee will furnish to Lessor and Loan Trustee promptly after execution and delivery of any supplement and amendment hereto and promptly after the execution and delivery of any supplement and amendment to the Indenture (except for any such supplement or amendment which does not require or receive the approval of Lessee pursuant to the Operative Documents and is not required pursuant to the terms of the Operative Documents), an opinion of counsel reasonably satisfactory to Lessor and Loan Trustee as to the due recording or filing of such supplement or amendment. SECTION 17. Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Lease shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: (i) if to Lessee, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 715-1657 (ii) if to Lessor, addressed to: Wells Fargo Bank Northwest, National Association, MAC: U1254-031 79 South Main Street Salt Lake City, Utah 84111 Attention: Corporate Trust Department Telephone: (801) [_________] Facsimile: (801) 246-5053 or if to any Noteholder, Loan Trustee or Owner Participant, addressed to such Noteholder, Loan Trustee or Owner Participant at such address or facsimile number as such Noteholder, Loan Trustee or Owner Participant has furnished by notice to Lessor and to Lessee, and, until an address is so furnished, addressed to such Noteholder, Loan Trustee or Owner Participant at its address or facsimile number set forth in Section 16.01 of the Participation Agreement. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 17. SECTION 18. No Set-Off, Counterclaim, etc. All Rent shall be paid by Lessee to Lessor in funds of the type specified in Section 3(e). Lessee's obligation to pay all Rent payable hereunder shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any set-off, counterclaim, recoupment, defense or other right which Lessee may have against Lessor, in its individual capacity or as Owner Trustee under the Trust Agreement, Loan Trustee (in its individual capacity or as Loan Trustee), any Noteholder, Owner Participant, or anyone else for any reason, including, without limitation, any breach by Lessor or Owner Participant of their respective warranties, agreements or covenants contained in any of the Operative Documents, (ii) any defect in the title, registration, airworthiness, condition, design, operation, or fitness for use of, or any damage to or loss or destruction of, the Aircraft, or any interruption or cessation in or prohibition of the use or possession thereof by Lessee (or any Permitted Sublessee) for any reason, including, without limitation, any such interruption, cessation or prohibition resulting from the act of any government authority, (iii) any insolvency, bankruptcy, reorganization or similar case or proceedings by or against Lessee (or any Permitted Sublessee) or any other person, or (iv) any other circumstance, happening, or event, whether or not unforeseen or similar to any of the foregoing. If for any reason this Lease is terminated in whole or in part by operation of law or otherwise except as specifically provided herein, Lessee nonetheless agrees without limitation of the other rights or remedies of Lessor hereunder to pay to Lessor an amount equal to each Rent payment at the time such payment would have become due and payable in accordance with the terms hereof had this Lease not been terminated in whole or in part. Lessee hereby waives, to the extent permitted by applicable law, any and all rights which it may now have or which at any time hereafter may be conferred upon it, by statute or otherwise, to terminate, cancel, quit or surrender this Lease except in accordance with the express terms hereof. SECTION 19. Renewal Options; Purchase Options; Valuation. (a) Renewal Options. (1) Fixed Renewal Term. Lessee may renew this Lease for a one year renewal term which shall commence only upon the expiration of the Basic Term (the "first Fixed Renewal Term"), a one year renewal term which shall commence only upon the expiration of the first Fixed Renewal Term (the "second Fixed Renewal Term"), and a one year renewal term which shall commence only upon the expiration of the second Fixed Renewal Term (the "third Fixed Renewal Term") (the first Fixed Renewal Term, the second Fixed Renewal Term and the third Fixed Renewal Term, each a "Fixed Renewal Term") by notice to Lessor at least 90 days before the end of the Basic Term, the first Fixed Renewal Term or the second Fixed Renewal Term, as the case may be, irrevocably electing to renew this Lease for a Fixed Renewal Term. Basic Rent during any Fixed Renewal Term shall be payable in an amount and at the times specified in Section 19(a)(4). (2) Fair Market Renewal Term. At the expiration of the third Fixed Renewal Term or any Fair Market Renewal Term, Lessee may renew this Lease by delivery to Lessor of a written notice irrevocably electing to renew this Lease for a renewal term of not less than one year and not more than three years at a Basic Rent equal to the "fair market rental value" of the Aircraft for such period (any such renewal term, a "Fair Market Renewal Term"). Each such right to renew may be exercised by Lessee notifying Lessor, at least 90 days prior to the commencement of such Fair Market Renewal Term, of its election irrevocably to renew this Lease for a Fair Market Renewal Term (which notice shall also specify the length of the Fair Market Renewal Term). (3) If no written notice is delivered by Lessee to Lessor pursuant to Section 19(a)(1) or 19(a)(2) on or before the day specified therefor, Lessee shall be deemed to have waived any right to renew this Lease. (4) At the end of the Basic Term or any Renewal Term, if Lessee has elected to renew this Lease as aforesaid, and provided that there shall not then have occurred and be continuing an Event of Default and that all necessary governmental authorizations and approvals shall have been received and that Basic Rent for the Renewal Term has already been determined as above provided and a Lease Supplement evidencing such renewal has been executed and filed for recordation with the FAA, this Lease shall continue in full force and effect during the Renewal Term, except that (x) Lessee shall pay the Lessor Basic Rent for the Aircraft during the Renewal Term in an amount equal to the "fair market rental value" thereof determined in accordance with Section 19(c), each semi-annual installment of Basic Rent not to exceed in the case of a Fixed Renewal Term [__]% of the average Basic Rent during the Basic Term (such average being determined as the total of all payments of Basic Rent during the Basic Term added together and divided by the number of payments of Basic Rent during the Basic Term), which Basic Rent shall be payable in semi-annual installments in arrears, each such installment being due and payable on each Lease Period Date occurring during the Renewal Term, commencing with the Lease Period Date immediately following the commencement of the Renewal Term, and (y) the Stipulated Loss Values applicable during the Renewal Term shall be determined separately for each Renewal Term by Owner Participant in good faith to reflect Stipulated Loss Values determined in accordance with the following sentence. Stipulated Loss Values during a Renewal Term shall on the date on which such Renewal Term begins be equal to the fair market sales value of the Aircraft as of such date, determined in accordance with the provisions of this Section 19(a)(4) and Section 19(c), and shall decline ratably on a monthly basis to the fair market sales value of the Aircraft as of the last day of such Renewal Term, determined in accordance with the provisions of this Section 19(a)(4) and Section 19(c). In determining fair market sales value for purposes of calculating Stipulated Loss Value for any Renewal Term effect shall be given to the encumbrance on the Aircraft of any Renewal Term available or in force under this Section 19. (b) Purchase Options. Lessee shall have the option, upon at least 60 days' irrevocable prior written notice to Lessor, to purchase the Aircraft on the last Business Day of the Basic Term or any Renewal Term for a purchase price equal to the lesser of (x) the fair market sales value of the Aircraft or (y) 50% of Lessor's Cost. Upon payment to Lessor in immediately available funds of the full amount of the purchase price and payment of any other amounts then due hereunder (including all Rent and all actual and reasonable out-of-pocket costs or expenses of Owner Participant in connection with such purchase), Lessor will transfer to Lessee, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), all of Lessor's right, title and interest in and to the Aircraft. (c) Valuation. At any time not earlier than 365 days prior to the date on which Lessee may purchase the Aircraft pursuant to Section 19(b) or renew this Lease pursuant to Section 19(a)(1) or Section 19(a)(2), Lessee may deliver to Lessor a revocable notice of its intent to exercise its renewal option or purchase option. For all purposes of this Section 19, including the appraisal referred to in this Section 19(c), in determining "fair market rental value" or "fair market sales value", the Aircraft shall be valued (i) as if in the condition and otherwise in compliance with the terms of Section 5 upon a return of the Aircraft in the United States and as if it had been maintained at all times as required in accordance with Section 7(c) during periods when no Sublease was in effect, (ii) on the basis of the value which would obtain in an arm's-length transaction between an informed and willing buyer-user or lessee (other than a lessee or an affiliate of a lessee currently in possession or a used equipment scrap dealer) under no compulsion to buy or lease and an informed and willing seller or lessor unaffiliated with such buyer-user or lessee and under no compulsion to sell or lease and disregarding the purchase and renewal options of Lessee provided in this Lease, and (iii) in the case of such valuation for determining "fair market rental value", assuming such lessee would have substantially the same obligations during the Renewal Term as provided hereunder including without limitation the obligations of Lessee to carry and maintain the insurance required by Section 11 hereof and to make certain payments with reference to Stipulated Loss Value during the applicable Renewal Term. Upon receipt of such notice Lessor and Lessee shall confer in good faith with a view to reaching agreement on the "fair market rental value" or "fair market sales value" of the Aircraft. If the parties have not so agreed by 270 days prior to the end of the Basic Term or the Renewal Term in question, then the question shall be determined by an appraisal mutually agreed to by two recognized independent aircraft appraisers, one of which appraisers shall be chosen by Lessor and one by Lessee within five Business Days after Lessor or Lessee have received written notice from the other party of a demand that such an appraisal be made, which notice shall specify the appraiser chosen by the party giving the notice or, if such appraisers cannot agree on the amount of such appraisal within twenty Business Days after the end of such five-day period, each shall render its own appraisal and shall by mutual consent choose another appraiser within five Business Days after the end of such twenty-day period. If, within such five-day period, such two appraisers fail to appoint a third appraiser, then either Lessor or Lessee, on behalf of both, may request such appointment by the then President of the Association of the Bar of the City of New York (or any successor organization thereto) or, in his absence, failure, refusal or inability to act, then either Lessor or Lessee may apply to the American Arbitration Association (or any successor organization thereto) in New York, New York for the appointment of such third appraiser. The decision of the third appraiser so appointed shall be given within twenty Business Days after the appointment of such third appraiser. As soon as the third appraiser has delivered his appraisal, that appraisal shall be compared with the appraisals given by the other two appraisers. If the determination of one appraiser is more disparate from the average of all three determinations than each of the other two determinations, then the determination of such appraiser shall be excluded, the remaining two determinations shall be averaged and such average shall be final and binding upon the parties hereto. If no determination is more disparate from the average of all three determinations than each of the other determinations, then such average shall be final and binding upon the parties thereto. Lessee and Lessor shall share equally all expenses relating to such appraisal procedure provided if Lessee elects not to renew this the Lease or purchase the Aircraft following such appraisal, Lessee shall pay all expenses of such appraisal. (d) Special Purchase Option. Lessee may, upon at least 90 days' irrevocable notice to Lessor and, if any Equipment Notes are then outstanding, Loan Trustee, purchase the Aircraft on the EBO Date for a purchase price equal to[, at Lessee's option, either (a)] the Special Purchase Price[, or (b) the amount set forth under the heading "Initial Installment" on Exhibit B-1 (the "Initial Installment") (payable on the EBO Date) plus the Remaining Installments]. In addition, if on such date there are any Equipment Notes outstanding, Lessee shall have the option to assume, pursuant to Section 6.01(k) of the Participation Agreement and Section 2.17 of the Indenture, all of the obligations of Lessor under the Indenture. If such assumption is made, in lieu of paying the Special Purchase Price on the EBO Date Lessee shall pay Lessor a purchase price equal to (I) [(x) if Lessee has elected to pay the Special Purchase Price,] the Special Purchase Price [or (y) if Lessee has elected to pay the Initial Installment and the Remaining Installments, the Initial Installment] minus [in either event] (II) an amount equal to principal of, and accrued but unpaid interest on, any Equipment Notes that are outstanding on such date. Upon such payment in full and payment of any other amounts then due hereunder (including actual and reasonable out-of-pocket costs or expenses of Owner Participant in connection with such purchase, any installments of Basic Rent payable prior to such date, and all unpaid Supplemental Rent due on or prior to such date), [and, in the event that Lessee has elected to pay the Initial Installment and the Remaining Installments, after Lessee shall have provided Lessor with its undertaking to pay the amounts payable on the dates set forth under the heading "Remaining Installments" on Exhibit B-1 (the "Remaining Installments"),] Lessor will transfer to Lessee, without recourse or warranty (except as to the conveyance of whatever title was received from Lessee and as to the absence of Lessor Liens, including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens), all of Lessor's right, title and interest in and to the Aircraft and under the Indenture and, unless any Equipment Notes are outstanding after such payment, exercise such rights as it has to cause the Aircraft to be released from the Lien of the Indenture[; provided, however, that in the event that Lessee has elected to pay the Initial Installment and the Remaining Installments, Lessor shall retain a Lien on the Aircraft until the Remaining Installments, together with interest thereon at the Past Due Rate for any period from the date due to the date paid, are paid in full, which Lien shall be evidenced by this Lease, which after the date Lessor has transferred title to the Aircraft to Lessee shall be deemed terminated as a true lease and shall continue as a lease intended for security, mutatis mutandis, to secure the payment when due of the Remaining Installments -- provision permitting utilization of Initial Installment and Remaining Installments may be utilized only if EBO Date occurs on or after maturity of Equipment Notes]. SECTION 20. Security for Lessor's Obligation to Holders of Equipment Notes. In order to secure the indebtedness evidenced by the Equipment Notes, Lessor has agreed in the Indenture, among other things, to assign to Loan Trustee this Lease, the Lease Supplements and any amendments to this Lease and to mortgage its interest in the Aircraft in favor of Loan Trustee, subject to the reservations and conditions therein set forth. To the extent, if any, that this Lease, the Lease Supplements and any amendments to this Lease constitute chattel paper (as such term is defined in the Uniform Commercial Code as in effect in any applicable jurisdiction), no security interest in this Lease, the Lease Supplements and any amendments to this Lease may be created through the transfer or possession of any counterpart other than the original counterpart, which shall be identified as the counterpart containing the receipt therefor executed by Loan Trustee on the signature page thereof. Lessee hereby accepts and consents to the assignment of all Lessor's right, title and interest in and to this Lease pursuant to the terms of the Indenture. Subject to Section 3(e), Lessee agrees to pay directly to Loan Trustee (or, after receipt by Lessee of notice from Loan Trustee of the discharge of the Indenture, to Lessor), all amounts of Rent due or to become due hereunder and assigned to Loan Trustee and Lessee agrees that Loan Trustee's right to such payments hereunder shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, the circumstances set forth in clauses (i) through (iv) of Section 18. Notwithstanding the foregoing assignment of this Lease, the obligations of Lessor to Lessee to perform the terms and conditions of this Lease shall remain in full force and effect. SECTION 21. Lessor's Right to Perform for Lessee. If Lessee fails to make any payment of Rent required to be made by it or fails to perform or comply with any of its agreements contained herein, then (but in each case, except in the case of failure to pay Rent or in the case of failure to maintain insurance as required hereunder, no earlier than the fifteenth day after the occurrence of such failure, whether or not it yet constitutes an Event of Default) Lessor may itself make such payment or perform or comply with such agreement but is not obligated hereunder to do so, and the amount of such payment and the amount of the reasonable expenses of Lessor incurred in connection with such payment or the performance of or compliance with such agreement, as the case may be, together with interest thereon at the Past Due Rate, shall be deemed Supplemental Rent, payable by Lessee upon demand. SECTION 22. Investment of Security Funds; Liability of Lessor Limited. (a) Investment of Security Funds. Any moneys held by Lessor as security hereunder for future payments to Lessee, until paid out by Lessor as herein provided, shall be invested and reinvested by Lessor (or, if the Indenture has not been discharged, by Loan Trustee) as Lessee may request in Permitted Investments as specified in such request (if such investments are reasonably available for purchase) and sold, in any case at such prices, including accrued interest or its equivalent, as are set forth in such request, and such Permitted Investments shall be held by Lessor (or, if the Indenture has not been discharged, by Loan Trustee) as security hereunder for future payments to Lessee until so sold. Lessee shall upon demand pay to Lessor (or, if the Indenture has not been discharged, to Loan Trustee) the amount of any loss realized upon maturity, sale or other disposition of any such Permitted Investment. So long as no Event of Default or Payment Default has occurred and is continuing, Lessee is entitled to receive from Lessor (or, if the Indenture has not been discharged, from Loan Trustee), and Lessor (or, if the Indenture has not been discharged, Loan Trustee) shall promptly pay to Lessee, any profit, income, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment. If an Event of Default or Payment Default has occurred and is continuing, any net income, profit, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment shall be held as security for future payments to Lessee and shall be applied by Lessor (or, if the Indenture has not been discharged, by Loan Trustee) at the same time, on the same conditions and in the same manner as the amounts in respect of which such income, profit, interest, dividend or gain was realized are required to be distributed in accordance with the provisions pursuant to which such amounts were required to be held. Neither Lessor nor Loan Trustee is responsible for any losses on any investments or sales of Permitted Investments made pursuant to the procedure specified in this Section 22 other than by reason of its willful misconduct or negligence. If any moneys or investments are held by Lessor (or, if the Indenture has not been discharged, by Loan Trustee) solely because an Event of Default has occurred and is continuing and such moneys or investments have been held for a period of 90 consecutive days during which such Event of Default is continuing without any remedial action being taken by Lessor or Loan Trustee in respect of such Event of Default pursuant to Section 15, and provided that there is no stay, moratorium or injunction in effect preventing the taking of such action, then, notwithstanding any other provision of the Operative Documents, all such moneys and investments held by Lessor (or, if the Indenture has not been discharged, by Loan Trustee) shall be released to Lessee on such 90th day, or on the next Business Day after such 90th day. (b) Liability of Lessor Limited. It is expressly agreed and understood that all representations, warranties and undertakings of Lessor hereunder shall be binding upon Lessor only in its capacity as trustee under the Trust Agreement, and the institution acting as Lessor shall not be liable in its individual capacity for any breach thereof except for its negligence or willful misconduct or for breach of its covenants, representations and warranties contained herein, to the extent covenanted or made in its individual capacity. SECTION 23. Submission to Jurisdiction. Lessor and Lessee each hereby irrevocably submits itself to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York and to the non-exclusive jurisdiction of the Supreme Court of the State of New York, New York County, for the purposes of any suit, action or other proceeding arising out of this Lease, the subject matter hereof or any of the transactions contemplated hereby brought by Lessor, Lessee, Loan Trustee, Noteholders or Owner Participant or their successors or permitted assigns. SECTION 24. Miscellaneous. Any provision of this Lease which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. No term or provision of this Lease may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by Lessor, Lessee and any assignee of Lessor's rights hereunder. This Lease shall constitute an agreement of lease, and nothing contained herein shall be construed as conveying to Lessee any right, title or interest in the Aircraft except as a lessee only. Neither Lessee nor any affiliate of Lessee will file any tax returns in a manner inconsistent with the foregoing fact or with Lessor's ownership of the Aircraft. The section and paragraph headings in this Lease and the table of contents are for convenience of reference only and shall not modify, define, expand or limit any of the terms or provisions hereof and all references herein to numbered sections, unless otherwise indicated, are to sections of this Lease. THIS LEASE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. This Lease may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. SECTION 25. Successor Trustee. Lessee agrees that in the case of the appointment of any successor Owner Trustee pursuant to the terms of the Trust Agreement, such successor Owner Trustee shall, upon written notice by such successor Owner Trustee, succeed to all the rights, powers and title of Lessor hereunder and shall be deemed to be Lessor and the owner of the Aircraft for all purposes hereof without the necessity of any consent or approval by Lessee (subject to Section 6.01(m) of the Participation Agreement) and without in any way altering the terms of this Lease or Lessee's obligations hereunder. One such appointment and designation of a successor Owner Trustee shall not exhaust the right to appoint and designate further successor Owner Trustees pursuant to the Trust Agreement, but such right may be exercised repeatedly as long as this Lease shall be in effect. SECTION 26. Covenant of Quiet Enjoyment. So long as no Event of Default has occurred and is continuing and notwithstanding any default by Lessor, Owner Participant or Loan Trustee under the Participation Agreement, the Trust Agreement or the Indenture, neither Lessor nor anyone acting or claiming by, through or in the name of Lessor may interfere with Lessee's (or any Permitted Sublessee's) continued possession, use and operation of, and quiet enjoyment of, the Aircraft during the Term, and this Lease shall not be terminated except as expressly provided herein. SECTION 27. Lessee's Performance and Rights. Any obligation imposed on Lessee herein shall require only that Lessee perform or cause to be performed such obligation, even if stated as a direct obligation, and the performance of any such obligation by any permitted assignee, sublessee or transferee under an assignment, sublease or transfer agreement then in effect and in accordance with the provisions of the Operative Documents shall constitute performance by Lessee and, to the extent of such performance, discharge such obligation by Lessee. Except as otherwise expressly provided herein, any right granted to Lessee in this Lease shall grant Lessee the right to permit such right to be exercised by any such assignee, sublessee or transferee. The inclusion of specific references to obligations or rights of any such assignee, sublessee or transferee in certain provisions of this Lease shall not in any way prevent or diminish the application of the provisions of the two sentences immediately preceding with respect to obligations or rights in respect of which specific reference to any such assignee, sublessee or transferee has not been made in this Lease. IN WITNESS WHEREOF, Lessor and Lessee have each caused this Lease to be duly executed as of the day and year first above written. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Owner Trustee, Lessor By: ________________________________________ Name: Title: DELTA AIR LINES, INC., Lessee By: ________________________________________ Name: Title: Receipt of this original counterpart of the foregoing Lease is hereby acknowledged on the _____ day of [____________] STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, Loan Trustee By: ________________________________________ Name: Title: EXHIBIT A to Lease Agreement (N____) LEASE SUPPLEMENT No. (N____) Lease Supplement No. __, dated [_________] between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, but solely as Owner Trustee under the Trust Agreement (N____), dated as of [_____________] between _____________________, as Owner Participant, and such Owner Trustee (such Owner Trustee, in its capacity as such Owner Trustee, being herein called "Lessor"), and DELTA Air lines, Inc. ("Lessee"). Lessor and Lessee have heretofore entered into that certain Lease Agreement (N____), dated as of [___________], relating to one Boeing 737-832 aircraft (herein called the "Lease," and the defined terms therein being hereinafter used with the same meanings). The Lease provides for the execution and delivery from time to time of Lease Supplements for the purpose of leasing the Airframe and Engines under the Lease as and when delivered by Lessor to Lessee in accordance with the terms thereof. (1)The Lease relates to the Airframe and Engines described below, and a counterpart of the Lease is attached hereto, and made a part hereof, and this Lease Supplement, together with such attachment, is being filed for recordation on the date hereof with the FAA as one document. (2)The Lease Agreement relates to the Airframe and Engines described below, and a counterpart of the Lease Agreement, attached and made a part of Lease Supplement No. 1 dated [______________] to the Lease Agreement, has been recorded by the FAA on [_____________], as one document and assigned Conveyance No. __. Now, Therefore, in consideration of the premises and other good and sufficient consideration, Lessor and Lessee hereby agree as follows: 1. Lessor hereby delivers and leases to Lessee under the Lease and Lessee hereby accepts and leases from Lessor under the Lease the following described aircraft (the "Aircraft"), which Aircraft as of the date hereof consists of the following components: (i) AIRFRAME: Manufacturer Model FAA Registration No. Manufacturer's Serial No. ------------ ----- -------------------- ------------------------- (ii) ENGINES: Manufacturer Model Manufacturer's Serial No. ------------ ----- ------------------------- Each Engine is of 750 or more "rated takeoff horsepower" or the equivalent of such horsepower. 2. The Delivery Date of the Aircraft is the date of this Lease Supplement set forth in the opening paragraph hereof. Except as otherwise provided in the Lease, the Term for the Aircraft shall commence on the Delivery Date and end on [___________ __, 20__]. 3. Lessee hereby confirms its agreement to pay the Lessor Basic Rent for the Aircraft throughout the Term therefor in accordance with Section 3 of the Lease. 4. Lessee hereby confirms to Lessor that Lessee has accepted the Aircraft for all purposes hereof and of the Lease as being airworthy, in good working order and repair and without defect or inherent vice in title, condition, design, operation or fitness for use; provided, however, that nothing contained herein or in the Lease shall in any way diminish or otherwise affect any right Lessee or Lessor may have with respect to the Aircraft against The Boeing Company, or any subcontractor or supplier of The Boeing Company, under the Purchase Agreement or otherwise. 5. All of the terms and provisions of the Lease are hereby incorporated by reference in this Lease Supplement to the same extent as if fully set forth herein. 6. This Lease Supplement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. To the extent, if any, that this Lease Supplement constitutes chattel paper (as such term is defined in the Uniform Commercial Code as in effect in any jurisdiction), no security interest in this Lease Supplement may be created through the transfer or possession of any counterpart other than the original counterpart, which shall be identified as the counterpart containing the receipt therefor executed by Loan Trustee on the signature page hereof. - ------------- (1) This language for Lease Supplement No. 1. (2) This language for other Lease Supplements. In Witness Whereof, Lessor and Lessee have caused this Lease Supplement to be duly executed on the day and year first above written. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its Individual Capacity, but solely as Owner Trustee, Lessor By: ________________________________________ Name: Title: DELTA Air lines, Inc., Lessee By: ________________________________________ Name: Title: (3)Receipt of this original counterpart of the foregoing Lease Supplement is hereby acknowledged on this ____ day of [______________] STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, Loan Trustee By: ________________________________________ Name: Title: - ------------- (3) This language contained in the original counterpart only. EXHIBIT B-1 to Lease Agreement (N____) BASIC RENT, LESSOR'S COST AND SPECIAL PURCHASE PRICE SCHEDULE The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information. Basic Rent: Lease Period Basic Rent Payable Date (Percentage of Lessor's Cost) ------------------------ -------------------------------- BASIC RENT, LESSOR'S COST AND SPECIAL PURCHASE PRICE SCHEDULE The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information. Lease Period Basic Rent Payable Date (Percentage of Lessor's Cost) ------------------------ --------------------------------- BASIC RENT, LESSOR'S COST AND SPECIAL PURCHASE PRICE SCHEDULE Lessor's Cost for the Aircraft: $[___________] Special Purchase Price: [_____________]% of Lessor's Cost (comprised of an early buy-out amount of [_______]% of Lessor's Cost plus the Cumulative Basic Rent Allocation of [_______]% of Lessor's Cost minus Cumulative Basic Rent Payments of [________]% of Lessor's Cost) on [______________]. [Initial Installment: [__]% of Lessor's Cost on [ ]. Remaining Installments: Date Amount ---- ------ April 15, [ ] [__]% of Lessor's Cost June 15, [ ] [__]% of Lessor's Cost September 15, [ ] [__]% of Lessor's Cost December 15, [ ] [__]% of Lessor's Cost] EXHIBIT B-2 to Lease Agreement (N____) BASIC RENT ALLOCATION SCHEDULE The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information. Lease Period Basic Rent Allocated From To (Percentage of Lessor's Cost) - ----------------------------------------- ----------------------------------- EXHIBIT C to Lease Agreement (N____) STIPULATED LOSS VALUE SCHEDULE The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information.
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
STIPULATED LOSS VALUE SCHEDULE
Stipulated Loss Stipulated Loss Value Percentage Value Percentage Stipulated Loss Before Basic Rent Cumulative Allocated Cumulative Cash Basic After Basic Rent Value Date Adjustments Basic Rent to Date Rent to Date Adjustments - ----------------- ------------------- ---------------------- ----------------------- -------------------
EXHIBIT D to Lease Agreement (N____) TERMINATION VALUE SCHEDULE The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information.
Termination Value Termination Value Percentage Before Percentage After Basic Rent Cumulative Allocated Cumulative Cash Basic Basic Rent Termination Date Adjustments Basic Rent to Date Rent to Date Adjustments - -------------------- ------------------- ---------------------- ----------------------- --------------------
EXHIBIT E to Lease Agreement (N____) RENT RECALCULATION VERIFICATION The portion of this Exhibit appearing below this text is intentionally deleted from the FAA filing counterpart as the parties hereto deem it to contain confidential information. 1. Any recalculation of Basic Rent percentages or allocations, Stipulated Loss Value percentages, Termination Value percentages, [the Initial Installment, the Remaining Installments] and the Special Purchase Price pursuant to the Lease shall be determined in good faith by Owner Participant, and shall maintain Owner Participant's Net Economic Return except as assumptions have been modified pursuant to Section 3 of the Lease or pursuant to the Tax Indemnity Agreement or the Participation Agreement, as the case may be; provided, however, that Lessee may request (A) Lessee's independent public accountants to verify such calculations but without any requirement that Owner Participant disclose to such persons the methodology and assumptions and (B) if Lessee believes that such calculations by Owner Participant are in error then a nationally recognized firm of accountants or a nationally recognized firm of lease advisors selected by Lessee and reasonably acceptable to Owner Participant shall be permitted to verify such calculations and Owner Participant will make available to such firm (subject to the execution by such firm of a confidentiality agreement reasonably acceptable to Owner Participant) the methodology and assumptions and any changes made therein pursuant to Section 3 of the Lease. In the event of a verification under clause (B) of the first sentence of this paragraph 1 the determination by such firm of accountants or lease advisors shall be final. Lessee will pay the reasonable and actual costs and expenses of the verification under clause (B) of the first sentence of this paragraph 1 unless an error adverse to Lessee is established by such firm, and if as a result of such verification process the Basic Rent is adjusted and such adjustment causes the Net Present Value of Rents to decline by [_] or more basis points (in which event Owner Participant shall pay the reasonable and actual costs and expenses of such verification process). Such recalculated Basic Rent percentages and allocations, Stipulated Loss Value percentages, Termination Value percentages[, Initial Installment, Remaining Installments] and Special Purchase Price shall be set forth in a Lease Supplement or an amendment to the Lease. 2. "Net Economic Return" means Owner Participant's net after-tax yield and aggregate after-tax cash flow, in each case computed from the Delivery Date through the EBO Date and through [___________________], utilizing the multiple investment sinking fund method of analysis, computed on the basis of the same methodology and assumptions as were utilized by Owner Participant in determining Basic Rent percentages and allocations, the Special Purchase Price, [the Initial Installment, the Remaining Installments,] Stipulated Loss Value and Termination Value percentages as of the Delivery Date. EXHIBIT F to Lease Agreement (N____) AIRCRAFT TYPE VALUE FOR SECTION 11(b) Boeing 737-832 - $8,000,000 EXHIBIT I TO PARTICIPATION AGREEMENT FORM OF AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT (N[_____]) Dated as of [________ __, 200_] between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly stated herein, but solely as Owner Trustee, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee --------------------- One Boeing 737-832 Aircraft U.S. Registration No. N[_____] TABLE OF CONTENTS Page ARTICLE I DEFINITIONS Section 1.01 Definitions.................................................. Section 1.02 Other Definitional Provisions................................ ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes...................................... Section 2.02 Issuance and Terms of Equipment Notes........................ Section 2.03 Method of Payment............................................ Section 2.04 Withholding Taxes............................................ Section 2.05 Application of Payments...................................... Section 2.06 Termination of Interest in Indenture Estate.................. Section 2.07 Registration, Transfer and Exchange of Equipment Notes....... Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes......... Section 2.09 Payment of Expenses on Transfer; Cancellation................ Section 2.10 Mandatory Redemption of Equipment Notes...................... Section 2.11 Voluntary Redemption of Equipment Notes...................... Section 2.12 Redemptions; Notice of Redemptions; Repurchases.............. Section 2.13 Subordination................................................ Section 2.14 Certain Payments............................................. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee................................................ Section 2.16 Directions by Subordination Agent............................ Section 2.17 Assumption of Equipment Notes by Lessee...................... Section 2.18 Payments from Indenture Estate Only......................... Section 2.19 Option to Purchase Equipment Notes........................... ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE INDENTURE ESTATE Section 3.01 Basic Rent Distributions..................................... Section 3.02 Event of Loss; Voluntary Termination; Refinancing............ Section 3.03 Payments after Indenture Event of Default.................... Section 3.04 Certain Payments............................................. Section 3.05 Other Payments............................................... Section 3.06 Payments to Owner Trustee.................................... ARTICLE IV COVENANTS OF OWNER TRUSTEE; INDENTURE EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Covenants of Owner Trustee.................................. Section 4.02 Indenture Events of Default.................................. Section 4.03 Certain Rights............................................... Section 4.04 Remedies..................................................... Section 4.05 Return of Aircraft........................................... Section 4.06 Remedies Cumulative.......................................... Section 4.07 Discontinuance of Proceedings................................ Section 4.08 Waiver of Past Defaults...................................... Section 4.09 Appointment of a Receiver.................................... Section 4.10 Loan Trustee Authorized to Execute Bills of Sale, Etc. ...... Section 4.11 Rights of Noteholders to Receive Payment..................... Section 4.12 Noteholders May Not Bring Suit Except Under Certain Conditions.................................................. ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Indenture Event of Default......................... Section 5.02 Action upon Instructions; Certain Rights and Limitations..... Section 5.03 Indemnification.............................................. Section 5.04 No Duties Except as Specified in Indenture or Instructions... Section 5.05 No Action Except under Lease, Indenture or Instructions...... Section 5.06 Replacement Airframes and Replacement Engines................ Section 5.07 Indenture Supplements for Replacements....................... Section 5.08 Effect of Replacement........................................ Section 5.09 Investment of Amounts Held by Loan Trustee................... ARTICLE VI OWNER TRUSTEE AND LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties.............................. Section 6.02 Absence of Certain Duties.................................... Section 6.03 No Representations or Warranties as to Aircraft or the Documents................................................... Section 6.04 No Segregation of Monies; No Interest........................ Section 6.05 Reliance; Agents; Advice of Counsel.......................... Section 6.06 Capacity in Which Acting..................................... Section 6.07 Compensation................................................. Section 6.08 Instructions from Noteholders................................ ARTICLE VII INDEMNIFICATION OF LOAN TRUSTEE BY OWNER TRUSTEE Section 7.01 Scope of Indemnification..................................... ARTICLE VIII SUCCESSOR AND SEPARATE TRUSTEES Section 8.01 Notice of Successor Owner Trustee............................ Section 8.02 Resignation and Removal of Loan Trustee; Appointment of Successor................................................... Section 8.03 Appointment of Additional and Separate Trustees.............. ARTICLE IX SUPPLEMENTS, AMENDMENTS AND WAIVERS Section 9.01 Instructions of Majority; Limitations........................ Section 9.02 Trustees Protected........................................... Section 9.03 Documents Mailed to Noteholders.............................. Section 9.04 No Request Necessary for Lease Supplement and Indenture Supplement.................................................. Section 9.05 Notation on or Exchange of Equipment Notes................... ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture..................................... Section 10.02 No Legal Title to Indenture Estate in Noteholders............ Section 10.03 Sale of Aircraft by Loan Trustee is Binding.................. Section 10.04 Indenture for Benefit of Owner Trustee, Owner Participant, Lessee, Loan Trustee and Noteholders........... Section 10.05 Notices...................................................... Section 10.06 Severability................................................. Section 10.07 No Oral Modification or Continuing Waivers................... Section 10.08 Successors and Assigns....................................... Section 10.09 Headings..................................................... Section 10.10 Normal Commercial Relations.................................. Section 10.11 Voting by Noteholders........................................ Section 10.12 Section 1110................................................. Section 10.13 Counterparts................................................. Section 10.14 Governing Law................................................ Section 10.15 No Action Contrary to Lessee's Rights Under the Lease........ Section 10.16 Submission to Jurisdiction................................... Exhibit A - Form of Indenture Supplement Schedule I - Description of Equipment Notes Schedule II - Pass Through Trust Agreement and Pass Through Trust Supplements Annex A - Definitions AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT (N[_____]) By the execution and delivery of this Agreement, (1) Owner Trustee (as hereinafter defined) does hereby assume the indebtedness and other obligations of Delta Air Lines, Inc. ("Lessee") under the Indenture and Security Agreement (N____), dated as of April 30, 2002, between Lessee and Loan Trustee (as hereinafter defined) as supplemented by the Supplement (as hereinafter defined) (said Indenture and Security Agreement (N_____) as supplemented by the Supplement, the "Original Indenture") as amended and restated below and the indebtedness and other obligations of Lessee under the Original Equipment Notes (as such term is defined Annex A hereto) (provided that Noteholders and Loan Trustee agree to look only to Lessee and that Lessee shall be solely responsible for claims with respect to indemnity and all other obligations (other than as to interest accruing after the Delivery Date and as to principal amount) arising, or as a result of actions or omissions occurring, prior to the Delivery Date; it being understood that nothing in the foregoing proviso is intended to omit from Owner Trustee's assumption, or relieve Owner Trustee from, the obligation to pay the principal amount or interest accruing from and after the Delivery Date thereon or performing or observing any other obligations set forth below from and after the Delivery Date), and (2) Loan Trustee (as hereinafter defined) does hereby release the Collateral (as such term is defined in the Original Indenture) described in paragraph (2) of the Granting Clause of the Original Indenture from the Lien of the Original Indenture, said Indenture and Security Agreement (N_____) and the Indenture Supplement (N_____) (the "Supplement") dated April 30, 2002, having been recorded with the Federal Aviation Administration on [_______ __], 2002 and assigned Conveyance No. [________], and the Original Indenture is hereby amended and restated in its entirety to read as follows: This AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT (N[_____]), dated as of [________ __, 200_], is made by and between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity, except as expressly stated herein, but solely as Owner Trustee under the Trust Agreement referred to below (together with its successors under the Trust Agreement, "Owner Trustee"), and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity, except as expressly stated herein, but solely as Loan Trustee hereunder (together with its permitted successors hereunder, "Loan Trustee"). W I T N E S S E T H: WHEREAS, Owner Participant and Owner Trustee have entered into the Trust Agreement whereby, among other things, (i) Owner Trustee has established a certain trust for the use and benefit of Owner Participant subject, however, to the Indenture Estate created pursuant hereto for the use and benefit of, and with the priority of payment to, the holders of Equipment Notes issued hereunder, and (ii) Owner Trustee has been authorized and directed to execute and deliver this Indenture; WHEREAS, the parties desire by this Indenture (such term and other capitalized terms used herein without definition being defined as provided in Article I), among other things, to provide for (i) the issuance by Owner Trustee of the Equipment Notes evidencing the participation of Pass Through Trustees in the payment of Lessor's Cost for the Aircraft, as provided in the Participation Agreement and (ii) the assignment, mortgage and pledge by Owner Trustee to Loan Trustee, as part of the Indenture Estate hereunder, among other things, of all of Owner Trustee's estate, right, title and interest in and to the Aircraft and, except as hereinafter expressly provided, all of Owner Trustee's right, title and interest in, to and under the Lease and all payments and other amounts received hereunder or thereunder in accordance with the terms hereof or thereof, as security for, among other things, Owner Trustee's obligations to Loan Trustee, for the ratable benefit and security of Noteholders, subject to Section 2.13 and Article III; WHEREAS, all things have been done to make the Equipment Notes, when executed by Owner Trustee and authenticated and delivered by Loan Trustee hereunder, the valid, binding and enforceable obligations of Owner Trustee; and WHEREAS, all things necessary to make this Indenture a legal, valid and binding obligation of Owner Trustee for the uses and purposes herein set forth, in accordance with its terms, have been done and performed and have occurred; GRANTING CLAUSE NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and all other amounts payable by Owner Trustee or Lessee under the Operative Documents to Noteholders and Indenture Indemnitees and the performance and observance by Owner Trustee of all the agreements and covenants to be performed or observed by Owner Trustee for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Owner Trustee at or before the Delivery Date, the receipt of which is hereby acknowledged, Owner Trustee does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Owner Trustee in, to and under, all and singular, the following described properties, rights, interests and privileges whether now or hereafter acquired, other than Excluded Payments (hereinafter sometimes referred to as the "Indenture Estate"): (1) the Aircraft, including the Airframe and the Engines, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided herein, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto to which Owner Trustee shall from time to time acquire title as provided herein and in the Lease (such Airframe and Engines as more particularly described in the Indenture Supplement executed and delivered with respect to the Aircraft on the Delivery Date or with respect to any substitutions or replacements therefor) and together with all logs, manuals maintained on the Aircraft, modification and maintenance records at any time required to be maintained with respect to the Aircraft, in accordance with the rules and regulations of the FAA if the Aircraft is registered under the laws of the United States or the rules and regulations of the government of the country of registry if the Aircraft is registered under the laws of a jurisdiction other than the United States; (2) the Lease and any Lease Supplement and all Rent thereunder (including, without limitation, all amounts of Basic Rent, Supplemental Rent and payments of any kind thereunder (excluding any Excluded Payments)); (3) the Purchase Agreement (to the extent specified in the Purchase Agreement Assignment), the Purchase Agreement Assignment, the Manufacturer's Consent and the Bill of Sale; (4) all rents, issues, profits, revenues and other income of the property subjected or required to be subjected to the lien of this Indenture; (5) all requisition proceeds with respect to the Aircraft or any Part thereof, and all insurance proceeds with respect to the Aircraft or any Part thereof, but excluding all proceeds of, and rights under, any insurance maintained by Lessee and in excess of that required under Section 11 of the Lease, and excluding insurance proceeds described in clauses (ii) and (iii) of the definition of Excluded Payments; (6) all rights of Owner Trustee to amounts paid or payable by Lessee to Owner Trustee under the Participation Agreement and all rights of Owner Trustee to enforce payments of any such amounts thereunder, but excluding amounts described in clauses (i) and (v) (and clauses (vii) and (viii) as they relate thereto) of the definition of Excluded Payments; (7) all moneys and securities now or hereafter paid or deposited or required to be paid or deposited to or with Loan Trustee to any term of any Operative Document and held or required to be held by Loan Trustee hereunder or thereunder (other than Excluded Payments); and (8) all proceeds of the foregoing; BUT EXCLUDING from the foregoing and from the Indenture Estate all Excluded Payments, and the right to enforce and collect the same, and SUBJECT TO all of the terms and conditions of this Indenture and the rights of Owner Trustee and Owner Participant hereunder. Concurrently with the delivery hereof, Owner Trustee is delivering to Loan Trustee the original executed counterpart of the Lease (to which a chattel paper receipt is attached), and executed copies of the Participation Agreement, the Purchase Agreement Assignment and the Manufacturer's Consent. TO HAVE AND TO HOLD all and singular the aforesaid property unto Loan Trustee, and its successors and permitted assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in this Indenture, including Section 2.13 and Article III, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and in all cases and as to all property specified in paragraphs (1) through (8) inclusive above, subject to the terms and provisions set forth in this Indenture. It is expressly agreed that anything herein contained to the contrary notwithstanding, Owner Trustee shall remain liable under each of the Indenture Agreements to which it is a party to perform all of the obligations assumed by it thereunder, except to the extent prohibited or excluded from doing so pursuant to the terms and provisions hereof, and Loan Trustee and Noteholders shall have no obligation or liability under the Indenture Agreements, by reason of or arising out of the assignment hereunder, nor shall Loan Trustee or Noteholders be required or obligated in any manner to perform or fulfill any obligations of Owner Trustee under or pursuant to any of the Indenture Agreements to which it is a party, or, except as herein expressly provided, to make any payment, or to make any inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or take any action to collect or enforce the payment of any amounts that may have been assigned to it or to which it may be entitled at any time or times. Owner Trustee does hereby constitute Loan Trustee the true and lawful attorney of Owner Trustee (which appointment is coupled with an interest) irrevocably, granted for good and valuable consideration, with full power of substitution and with full power (in the name of Owner Trustee or otherwise) to ask, require, demand and receive any and all monies and claims for monies (in each case including insurance and requisition proceeds but in all cases excluding Excluded Payments) due and to become due under or arising out of the Indenture Agreements, and all other property which now or hereafter constitutes part of the Indenture Estate, to endorse any checks or other instruments or orders in connection therewith and to file any claims or to take any action or to institute any proceedings which Loan Trustee may deem to be necessary or advisable in the premises. Without limiting the generality of the foregoing, but subject to the rights of Owner Trustee and Owner Participant hereunder, during the continuance of any Indenture Event of Default, Loan Trustee shall have the right under such power of attorney to accept any offer in connection with the exercise of remedies as set forth herein of any purchaser to purchase the Airframe and Engines and upon such purchase to execute and deliver in the name of and on behalf of Owner Trustee an appropriate bill of sale and other instruments of transfer relating to the Airframe and Engines, when purchased by such purchaser, and to perform all other necessary or appropriate acts with respect to any such purchase, and in its discretion to file any claim or take any other action or proceedings, either in its own name or in the name of Owner Trustee or otherwise, which Loan Trustee may deem necessary or appropriate to protect and preserve the right, title and interest of Loan Trustee in and to such Rents and other sums and the security intended to be afforded hereby; provided, however, that no action of Loan Trustee pursuant to this paragraph shall increase the obligations or liabilities of Owner Trustee to any Person beyond those obligations and liabilities specifically set forth in this Indenture and in the other Operative Documents. Under the Lease, Lessee is directed, so long as this Indenture shall not have been fully discharged, to make all payments of Rent (other than Excluded Payments) and all other amounts which are required to be paid to or deposited with Owner Trustee pursuant to the Lease (other than Excluded Payments) directly to, or as directed by, Loan Trustee at such address or addresses as Loan Trustee shall specify, for application as provided in this Indenture. Owner Trustee agrees that promptly upon receipt thereof, it will transfer to Loan Trustee any and all monies from time to time received by it constituting part of the Indenture Estate, for distribution by Loan Trustee pursuant to this Indenture, except that Owner Trustee shall accept for distribution pursuant to the Trust Agreement any amounts distributed to it by Loan Trustee under this Indenture. Owner Trustee agrees that at any time and from time to time, upon the written request of Loan Trustee, Owner Trustee shall promptly and duly execute and deliver or cause to be duly executed and delivered any and all such further instruments and documents as Loan Trustee may reasonably deem necessary to perfect, preserve or protect the mortgage, security interests and assignments created or intended to be created hereby or to obtain for Loan Trustee the full benefit of the assignment hereunder and of the rights and powers herein granted, provided that any instrument or other document so executed by Owner Trustee will not expand any obligations or limit any rights of Owner Trustee in respect of the transactions contemplated by the Operative Documents. The parties hereto acknowledge that neither Owner Trustee nor Owner Participant shall have any obligation as to any recording, filing, refiling or re-recording of any documents or instruments in regard to maintaining the perfection of the security interests created hereunder, in the Indenture Estate or any security interest that may be claimed to have been created by the Lease or the ownership interest of Owner Trustee in the Aircraft. Owner Trustee does hereby warrant and represent that it has not sold, assigned or pledged, and hereby covenants and agrees that it will not sell, assign or pledge, so long as this Indenture shall remain in effect and the Lien hereof shall not have been released pursuant to the provisions hereof, any of its estate, right, title or interest hereby assigned, to any Person other than Loan Trustee, except as otherwise provided in or permitted by any Operative Document, and that it will not, except as otherwise provided in this Indenture and except with respect to Excluded Payments to which it is entitled, (i) accept any payment from Lessee under any Indenture Agreement, (ii) enter into any agreement amending or supplementing any Indenture Agreement, (iii) execute any waiver or modification of, or consent under, the terms of, or exercise any rights, powers or privileges under, any Indenture Agreement, (iv) settle or compromise any claim (other than those relating to an Excluded Payment) arising under any Indenture Agreement or (v) submit or consent to the submission of any dispute, difference or other matter arising under or in respect of any Indenture Agreement to arbitration thereunder. Owner Trustee does hereby further agree that it will not without the written consent of Loan Trustee: (a) collect or agree to the receipt or collection of any payment of Rent (other than Excluded Payments), including Basic Rent, Stipulated Loss Value, Termination Value or any other payment to be made pursuant to Section 9 or 10 of the Lease prior to the date for the payment thereof provided for by the Lease or assign, transfer or hypothecate (other than to Loan Trustee hereunder) any payment of Rent (other than Excluded Payments), including Basic Rent, Stipulated Loss Value, Termination Value or any other payment to be made pursuant to Section 9 or 10 of the Lease, then due or to accrue in the future under the Lease in respect of the Airframe and Engines; or (b) except as contemplated by the Trust Agreement in connection with the appointment of a successor owner trustee, sell, mortgage, transfer, assign or hypothecate (other than to Loan Trustee hereunder) its interest in the Airframe and Engines or any part thereof or in any amount to be received by it from the use or disposition of the Airframe and Engines, other than amounts distributed to it pursuant to Article III hereof. It is hereby further agreed that any and all property described or referred to in the granting clauses hereof which is hereafter acquired by Owner Trustee shall ipso facto, and without any further conveyance, assignment or act on the part of Owner Trustee or Loan Trustee, become and be subject to the Lien herein granted as fully and completely as though specifically described herein, but nothing contained in this paragraph shall be deemed to modify or change the obligations of Owner Trustee contained in the foregoing paragraphs. Owner Trustee does hereby ratify and confirm the Lease and does hereby agree that it will not violate any covenant or agreement made by it therein, herein or in any of the other Operative Documents to which Owner Trustee is a party. Notwithstanding the Granting Clause or any of the foregoing paragraphs, there is hereby excluded from the foregoing sale, transfer, assignment, grant, pledge and security interest all Excluded Payments. IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. For all purposes of this Indenture, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Indenture to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Indenture, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". (e) All references in this Indenture to a "government" are to such government and any instrumentality or agency thereof. ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes. The Equipment Notes shall be substantially in the form set forth below: THIS EQUIPMENT NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. ACCORDINGLY, THIS EQUIPMENT NOTE MAY NOT BE OFFERED FOR SALE OR SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND SUCH APPLICABLE STATE OR OTHER LAWS OR EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, AS OWNER TRUSTEE UNDER TRUST AGREEMENT (N____) DATED AS OF [_______________] SERIES 2002-1 [___] NON-RECOURSE EQUIPMENT NOTE DUE [___] ISSUED IN CONNECTION WITH THE BOEING 737-832 AIRCRAFT BEARING UNITED STATES REGISTRATION NUMBER N[_____] No.____ Date: [______,__] $________________ INTEREST RATE MATURITY DATE [____] [___________,_____] WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee (herein in such capacity called "Owner Trustee") under that certain Trust Agreement (N ____), dated as of [_______________], between Owner Participant named therein and Wells Fargo (herein as such Trust Agreement may be supplemented or amended from time to time called the "Trust Agreement") hereby promises to pay to ___________, or the registered assignee thereof, the principal amount of ________________ Dollars ($_________) [on __________](1) [in installments on the Payment Dates set forth in Schedule I hereto, each such installment to be in an amount computed by multiplying the original principal amount of this Equipment Note by the percentage set forth in Schedule I hereto opposite the Payment Date on which such installment is due,](2) and to pay interest in arrears on each Payment Date at the Debt Rate on the principal amount remaining unpaid from time to time (calculated on the basis of a year of 360 days comprised of twelve 30-day months) from the date hereof until paid in full. [Notwithstanding the foregoing, the final payment made on this Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, this Equipment Note.]2 Notwithstanding anything to the contrary contained herein, if any date on which a payment under this Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. For purposes hereof, the term "Indenture" means the Amended and Restated Indenture and Security Agreement (N[_____]), dated as of [_________ __, 200_], between Owner Trustee and State Street Bank and Trust Company of Connecticut, National Association, as Loan Trustee ("Loan Trustee"), as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. All capitalized terms used in this Equipment Note and not defined herein, unless the context otherwise requires, shall have the respective meanings set forth or incorporated by reference, and shall be construed and interpreted in the manner described, in the Indenture. This Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable hereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue if not paid in the manner provided herein or in the Indenture when due (whether at stated maturity, by acceleration or otherwise). All payments of principal amount, interest, Make-Whole Amount, if any, and other amounts, if any, to be made by Owner Trustee hereunder and under the Indenture shall be payable only from the income and proceeds from the Trust Estate to the extent included in the Indenture Estate and only to the extent that Owner Trustee shall have sufficient income or proceeds from the Trust Estate to the extent included in the Indenture Estate to enable Loan Trustee to make such payments in accordance with the terms of Section 2.18 and Article III of the Indenture and each holder hereof, by its acceptance of this Equipment Note, agrees that it will look solely to the income and proceeds from the Indenture Estate to the extent available for distribution to the holder hereof as above provided and that none of Owner Participant, Owner Trustee or Loan Trustee is personally liable or liable in any manner extending to any assets other than the Indenture Estate to the holder hereof for any amounts payable or any liability under this Equipment Note or, except as provided in the Indenture or in the Participation Agreement, for any liability under the Indenture or the Participation Agreement; provided, however, that nothing herein contained shall limit, restrict or impair the right of Loan Trustee, subject always to the terms and provisions of the Indenture, to accelerate the maturity of this Equipment Note upon occurrence of an Indenture Event of Default in accordance with Section 4.04 of the Indenture, to bring suit and obtain a judgment against Owner Trustee on this Equipment Note for purposes of realizing upon the Indenture Estate and to exercise all rights and remedies provided under the Indenture or otherwise realize upon the Indenture Estate. There shall be maintained an Equipment Note Register for the purpose of registering transfers and exchanges of Equipment Notes at the Corporate Trust Office of Loan Trustee, or at the office of any successor trustee, in the manner provided in Section 2.07 of the Indenture. The principal amount and interest and other amounts due hereunder shall be payable in Dollars in immediately available funds at the Corporate Trust Office of Loan Trustee, or as otherwise provided in the Indenture. Owner Trustee shall not have any responsibility for the distribution of any such payment to Noteholder of this Equipment Note. Each such payment shall be made on the date such payment is due and without any presentment or surrender of this Equipment Note, except that in the case of any final payment with respect to this Equipment Note, the Equipment Note shall be surrendered to Loan Trustee for cancellation. The holder hereof, by its acceptance of this Equipment Note, agrees that, except as provided in the Indenture, including the subordination provisions referred to below, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest received by it hereunder shall be applied: first, to the payment of accrued interest on this Equipment Note (as well as any interest on any overdue principal amount, and, to the extent permitted by law, any overdue Make-Whole Amount, if any, any overdue interest and other overdue amounts hereunder) to the date of such payment; second, to the payment of Make-Whole Amount, if any, and third, to the payment of the principal amount of this Equipment Note (or portion hereof) then due. This Equipment Note is one of the Equipment Notes referred to in the Indenture which have been or are to be issued by Owner Trustee pursuant to the terms of the Indenture. The Indenture Estate is held by Loan Trustee as security, in part, for the Equipment Notes. The provisions of this Equipment Note are subject to the Indenture and the Participation Agreement. Reference is hereby made to the Indenture and the Participation Agreement for a complete statement of the rights and obligations of the holder of, and the nature and extent of the security for, this Equipment Note and the rights and obligations of the holders of, and the nature and extent of the security for, any other Equipment Notes executed and delivered under the Indenture, to all of which terms and conditions in the Indenture and the Participation Agreement each holder hereof agrees by its acceptance of this Equipment Note. As provided in the Indenture and subject to certain limitations therein set forth, this Equipment Note is exchangeable for a like aggregate principal amount of Equipment Notes of the same Series of different authorized denominations, as requested by the holder surrendering the same. Prior to the due presentment for registration of transfer of this Equipment Note, Owner Trustee and Loan Trustee shall deem and treat the Person in whose name this Equipment Note is registered on the Equipment Note Register as the absolute owner and holder hereof for the purpose of receiving all amounts payable with respect to this Equipment Note and for all purposes, and neither Owner Trustee nor Loan Trustee shall be affected by notice to the contrary. This Equipment Note is subject to redemption as provided in Sections 2.10 and 2.11 of the Indenture but not otherwise. This Equipment Note is also subject to assumption by Lessee as provided in Section 2.17 of the Indenture, to exchange and to purchase by Owner Participant or Owner Trustee as provided in Section 2.19 of the Indenture, but not otherwise. The indebtedness evidenced by this Equipment Note [shall rank in right of payment equally with all Series G-2 Equipment Notes and all other Series G-1 Equipment Notes.](3) [shall rank in right of payment equally with all Series G-1 Equipment Notes and all other Series G-2 Equipment Notes.](4) [is, to the extent and in the manner provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations (as defined in the Indenture) in respect of [Series G-1 Equipment Notes and Series G-2 Equipment Notes](5), and this Equipment Note is issued subject to such provisions.](6) Noteholder of this Equipment Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs Loan Trustee on such Noteholder's behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in the Indenture and (c) appoints Loan Trustee such Noteholder's attorney-in-fact for such purpose. [Without limiting the foregoing, the](7) [The](8) Noteholder of this Equipment Note, by accepting the same, agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligation in respect of this Equipment Note that it is not entitled to receive under Section 2.13 or Article III of the Indenture, it shall hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III of the Indenture. Unless the certificate of authentication hereon has been executed by or on behalf of Loan Trustee by manual signature, this Equipment Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. THIS EQUIPMENT NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. IN WITNESS WHEREOF, Owner Trustee has caused this Equipment Note to be executed in its corporate name by its officer thereunto duly authorized on the date hereof. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By:____________________________________ Name: Title: LOAN TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Equipment Notes referred to in the within-mentioned Indenture. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee By:____________________________________ Name: Title: - ------------- (1) To be inserted in non-installment Equipment Notes. (2) To be inserted in installment Equipment Notes. (3) To be inserted in the case of a Series G-1 Equipment Note. (4) To be inserted in the case of a Series G-2 Equipment Note. (5) To be inserted in the case of a Series C Equipment Note. (6) To be inserted in the case of a Series C Equipment Note. (7) To be inserted in the case of a Series C Equipment Note. (8) To be inserted in the case of a Series G-1 Equipment Note or a Series G-2 Equipment Note. SCHEDULE I(9) EQUIPMENT NOTE AMORTIZATION Payment Date Percentage of Original Principal Amount to be Paid [SEE "EQUIPMENT NOTES AMORTIZATION" ON SCHEDULE I TO INDENTURE WHICH IS TO BE INSERTED UPON ISSUANCE] * * * Section 2.02 Issuance and Terms of Equipment Notes. The Equipment Notes shall be dated the date of issuance thereof, shall be issued in (a) three separate series consisting of Series G-1 Equipment Notes, Series G-2 Equipment Notes, and Series C Equipment Notes and (b) the maturities and principal amounts and shall bear interest at the applicable Debt Rates specified in Schedule I. On the Delivery Date, each Series G-1 Equipment Note, Series G-2 Equipment Note, and Series C Equipment Note shall be issued to Subordination Agent on behalf of each of Pass Through Trustees for the Pass Through Trusts created under the Pass Through Trust Agreements referred to in Schedule II. The Equipment Notes shall be issued in registered form only. The Equipment Notes shall be issued in denominations of $1,000 and integral multiples thereof, except that one Equipment Note of each Series may be in an amount that is not an integral multiple of $1,000. Each Equipment Note shall bear interest at the Debt Rate (calculated on the basis of a year of 360 days comprised of twelve 30-day months), payable in arrears on each Payment Date on the unpaid principal amount thereof from time to time outstanding until such principal amount is paid in full, as further provided in the form of Equipment Note set forth in Section 2.01. The principal amount of each Series G-1 Equipment Note and each Series C Equipment Note shall be payable in installments on the Payment Dates and in the installments equal to the corresponding percentage of the principal amount set forth in Schedule I hereto applicable to such Series, which shall be attached as Schedule I to such Equipment Note. The principal amount of each Series G-2 Equipment Note shall be due in a single payment on July 2, 2012. Notwithstanding the foregoing, the final payment made under each Series G-1 Equipment Note and each Series C Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, such Equipment Note. Each Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not at the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable thereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue under an Equipment Note if not paid in the manner provided therein or in this Indenture when due (whether at stated maturity, by acceleration or otherwise). Notwithstanding anything to the contrary contained herein, if any date on which a payment hereunder or under any Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. The Equipment Notes shall be executed on behalf of Owner Trustee by the manual or facsimile signature of one of its authorized officers. Equipment Notes bearing the signatures of individuals who were at the time of execution the proper officers of Owner Trustee shall bind Owner Trustee, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Equipment Notes or did not hold such offices at the respective dates of such Equipment Notes. No Equipment Note shall be secured by or entitled to any benefit under this Indenture or be valid or obligatory for any purposes unless there appears on such Equipment Note a certificate of authentication in the form provided herein executed by Loan Trustee by the manual signature of one of its authorized officers, and such certificate upon any Equipment Notes shall be conclusive evidence, and the only evidence, that such Equipment Note has been duly authenticated and delivered hereunder. Section 2.03 Method of Payment. The principal amount of, interest on, Make-Whole Amount, if any, and, except to the extent expressly provided herein, all other amounts due to any Noteholder under each Equipment Note or otherwise payable hereunder shall be payable by Owner Trustee in Dollars by wire transfer of immediately available funds not later than 10:00 a.m. (New York City time) on the due date of payment to Loan Trustee at the Corporate Trust Office for distribution among Noteholders in the manner provided herein. Owner Trustee shall not have any responsibility for the distribution of such payment to any Noteholder. Notwithstanding the foregoing or any provision in any Equipment Note to the contrary, Loan Trustee will use reasonable efforts to pay or cause to be paid, if so directed in writing by any Noteholder (with a copy to Owner Trustee and Lessee), all amounts paid by Owner Trustee hereunder and under such Noteholder's Equipment Note or Equipment Notes to such Noteholder or a nominee therefor (including all amounts distributed pursuant to Article III) by transferring, or causing to be transferred, by wire transfer of immediately available funds in Dollars, prior to 12:00 noon (New York City time) on the due date of payment, to an account maintained by such Noteholder with a bank located in the continental United States the amount to be distributed to such Noteholder, for credit to the account of such Noteholder maintained at such bank; provided that, in the event the Equipment Notes are not held by Subordination Agent on behalf of Pass Through Trustees, Loan Trustee may at its option pay such amounts by check mailed to Noteholder's address as it appears on the Equipment Note Register. If, after its receipt of funds at the place and prior to the time specified above in the immediately preceding sentence, Loan Trustee fails (other than as a result of a failure of Noteholder to provide it with wire transfer instructions) to make any such payment required to be paid by wire transfer as provided in the immediately preceding sentence on the Business Day it receives such funds, Loan Trustee, in its individual capacity and not as trustee, agrees to compensate such Noteholders for loss of use of funds at the Federal Funds Rate until such payment is made and Loan Trustee shall be entitled to any interest earned on such funds until such payment is made. Any payment made hereunder shall be made without any presentment or surrender of any Equipment Note, except that, in the case of the final payment in respect of any Equipment Note, such Equipment Note shall be surrendered to Loan Trustee for cancellation. Notwithstanding any other provision of this Indenture to the contrary, Loan Trustee shall not be required to make, or cause to be made, wire transfers as aforesaid prior to the first Business Day on which it is practicable for Loan Trustee to do so in view of the time of day when the funds to be so transferred were received by it if such funds were received after 1:00 p.m. (New York City time) at the place of payment. Section 2.04 Withholding Taxes. Loan Trustee shall exclude and withhold at the appropriate rate from each payment of principal amount of, interest on, Make-Whole Amount, if any, and other amounts due hereunder or under each Equipment Note (which exclusion and withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) any and all withholding taxes applicable thereto as required by law. Loan Trustee agrees to act as such withholding agent and, in connection therewith, whenever any present or future taxes or similar charges are required to be withheld with respect to any amounts payable hereunder or in respect of the Equipment Notes, to withhold such amounts (which withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) and timely pay the same to the appropriate authority in the name of and on behalf of Noteholders, that it will file any necessary withholding tax returns or statements when due, and that as promptly as possible after the payment thereof it will deliver to each Noteholder (with a copy to Owner Trustee and Lessee) appropriate documentation showing the payment thereof, together with such additional documentary evidence as any such Noteholder may reasonably request from time to time. Loan Trustee agrees to file any other information reports it is required to file under United States law. Neither Owner Participant nor Owner Trustee shall be liable for the failure of Loan Trustee to withhold taxes in the manner provided for herein. Section 2.05 Application of Payments. Subject always to Section 2.13 and except as otherwise provided in Article III, in the case of each Equipment Note, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest paid thereon shall be applied: first, to the payment of accrued interest on such Equipment Note (as well as any interest on any overdue principal amount and (to the extent permitted by law) any overdue Make-Whole Amount, if any, any overdue interest and any other overdue amounts thereunder) to the date of such payment; and second, to the payment of Make-Whole Amount, if any; and third, to the payment of principal amount of such Equipment Note (or portion thereof) then due thereunder. Section 2.06 Termination of Interest in Indenture Estate. No Noteholder or Indenture Indemnitee shall, as such, have any further interest in, or other right with respect to, the Indenture Estate when and if the principal amount of, Make-Whole Amount, if any, and interest (including interest on any overdue amounts) on and all other amounts due under all Equipment Notes held by such Noteholder and all other sums then payable to such Noteholder or Indenture Indemnitee, as the case may be, hereunder and under the other Operative Documents by Owner Trustee (collectively, "Secured Obligations") have been paid in full. Section 2.07 Registration, Transfer and Exchange of Equipment Notes. Loan Trustee shall keep a register or registers (the "Equipment Note Register") in which Loan Trustee shall provide for the registration of Equipment Notes and the registration of transfers of Equipment Notes. No such transfer shall be given effect unless and until registration hereunder shall have occurred. The Equipment Note Register shall be kept at the Corporate Trust Office of Loan Trustee. Loan Trustee is hereby appointed "Equipment Note Registrar" for the purpose of registering Equipment Notes and transfers of Equipment Notes. A holder of any Equipment Note intending to exchange or transfer such Equipment Note shall surrender such Equipment Note to Loan Trustee at the Corporate Trust Office, together with a written request from the registered holder thereof for the issuance of a new Equipment Note of the same Series, specifying, in the case of a surrender for transfer, the name and address of the new holder or holders. Upon surrender for registration of transfer of any Equipment Note and subject to satisfaction of Section 2.09, Owner Trustee shall execute, and Loan Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Equipment Notes of an equal aggregate principal amount and of the same Series. At the option of Noteholder, Equipment Notes may be exchanged for other Equipment Notes of the same Series of any authorized denominations of an equal aggregate principal amount, upon surrender of the Equipment Notes to be exchanged to Loan Trustee at the Corporate Trust Office. Whenever any Equipment Notes are so surrendered for exchange, Owner Trustee shall execute, and Loan Trustee shall authenticate and deliver, the Equipment Notes which Noteholder making the exchange is entitled to receive. All Equipment Notes issued upon any registration of transfer or exchange of Equipment Notes (whether under this Section 2.07 or under Section 2.08 or otherwise under this Indenture) shall be the valid obligations of Owner Trustee evidencing the same respective obligations, and entitled to the same security and benefits under this Indenture, as the Equipment Notes surrendered upon such registration of transfer or exchange. Every Equipment Note presented or surrendered for registration of transfer shall be duly endorsed or be accompanied by a written instrument of transfer in form satisfactory to Loan Trustee, duly executed by Noteholder or such Noteholder's attorney duly authorized in writing, and Loan Trustee shall require evidence satisfactory to it as to the compliance of any such transfer with the Securities Act of 1933, as amended, and the securities laws of any applicable state or jurisdiction. Loan Trustee shall make a notation on each new Equipment Note of the amount of all payments of principal amount previously made on the old Equipment Note or Equipment Notes with respect to which such new Equipment Note is issued and the date to which interest on such old Equipment Note or Equipment Notes has been paid. Principal, interest and all other amounts shall be deemed to have been paid on such new Equipment Note to the date on which such amounts have been paid on such old Equipment Note. Owner Trustee shall not be required to exchange any surrendered Equipment Notes as provided above (a) during the ten-day period preceding the due date of any payment on such Equipment Note or (b) that has been called for redemption. Owner Trustee and Loan Trustee shall in all cases deem and treat the Person in whose name any Equipment Note has been issued and registered on the Equipment Note Register as the absolute owner and Noteholder of such Equipment Note for the purpose of receiving payment of all amounts payable with respect to such Equipment Note and for all other purposes, and neither Owner Trustee nor Loan Trustee shall be affected by any notice to the contrary. Loan Trustee will promptly notify Owner Trustee, Owner Participant and Lessee of each registration of a transfer of an Equipment Note. Any such transferee of an Equipment Note, by its acceptance of an Equipment Note, agrees to the provisions of the Operative Documents applicable to Noteholders, and shall be deemed to have represented, warranted and covenanted to the parties to the Participation Agreement as to the matters represented, warranted and covenanted by Noteholders, including Pass Through Trustees, in the Participation Agreement. Subject to compliance by Noteholder and any transferee of the requirements set forth in this Section 2.07 and in Section 2.09, Loan Trustee and Owner Trustee shall use all reasonable efforts to issue new Equipment Notes upon transfer or exchange within ten Business Days of the date an Equipment Note is surrendered for transfer or exchange. Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes. If any Equipment Note becomes mutilated, destroyed, lost or stolen, Owner Trustee shall, upon the written request of the holder of such Equipment Note and subject to satisfaction of this Section 2.08 and of Section 2.09, execute and Loan Trustee shall authenticate and deliver in replacement thereof a new Equipment Note of the same Series, payable in the same principal amount, dated the same date and captioned as issued in connection with the Aircraft. If the Equipment Note being replaced has become mutilated, such Equipment Note shall be surrendered to Loan Trustee, and a photocopy thereof shall be furnished to Owner Trustee. If the Equipment Note being replaced has been destroyed, lost or stolen, the holder of such Equipment Note shall furnish to Owner Trustee, Owner Participant and Loan Trustee such security or indemnity as may be required by them to save Owner Trustee, Owner Participant and Loan Trustee harmless and evidence satisfactory to Owner Trustee, Owner Participant and Loan Trustee of the destruction, loss or theft of such Equipment Note and of the ownership thereof. Section 2.09 Payment of Expenses on Transfer; Cancellation. (a) No service charge shall be made to a Noteholder for any registration of transfer or exchange of Equipment Notes, but Loan Trustee, as Equipment Note Registrar, may require payment of a sum sufficient to cover any Tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Equipment Notes. (b) Loan Trustee shall cancel all Equipment Notes surrendered for replacement, redemption, transfer, exchange, payment or cancellation, shall keep a copy of such canceled Equipment Notes, and shall send the original canceled Equipment Notes marked "canceled" to Lessee. Section 2.10 Mandatory Redemption of Equipment Notes. (a) On the date on which Lessee is required pursuant to Section 10(a)(i) of the Lease to make payment for an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon; all of the Equipment Notes shall be redeemed in whole at a redemption price equal to 100% of the unpaid principal amount thereof, together with all accrued interest thereon to (but excluding) the date of redemption and all other amounts payable hereunder or under the Participation Agreement to Noteholders, but without any Make-Whole Amount. (b) If the Lease is terminated with respect to the Aircraft by Lessee pursuant to Section 9 or Section 19(d) thereof and Lessee shall not have assumed all of the obligations of Owner Trustee hereunder pursuant to Section 2.17 and to Section 6.01(k) of the Participation Agreement, on the date the Lease is so terminated all of the Equipment Notes shall be redeemed in whole at a redemption price equal to 100% of the unpaid principal amount thereof, together with accrued interest thereon to (but excluding) the date of redemption and all other amounts payable hereunder or under the Participation Agreement to Noteholders plus Make-Whole Amount, if any. Section 2.11 Voluntary Redemption of Equipment Notes. All, but not less than all, of the Equipment Notes may be redeemed in whole by Owner Trustee in connection with a transaction described in, and subject to the terms and conditions of, Section 13.01 of the Participation Agreement upon at least 20 days' revocable prior written notice to Loan Trustee at a redemption price equal to 100% of the unpaid principal amount of the Equipment Notes being redeemed, together with accrued interest thereon to (but excluding) the date of redemption and all other amounts payable hereunder or under the Participation Agreement to Noteholders plus the Make-Whole Amount, if any. Section 2.12 Redemptions; Notice of Redemptions; Repurchases. (a) Neither any redemption of any Equipment Note nor any purchase by Owner Trustee of any Equipment Note may be made except to the extent and in the manner expressly permitted by this Indenture. At such time as no Pass Through Certificates are outstanding, Owner Trustee may at any time repurchase any of the Equipment Notes at any price in the open market and may hold, resell or surrender such Equipment Notes to Loan Trustee for cancellation. (b) Notice of redemption or purchase with respect to the Equipment Notes shall be given by Loan Trustee by first-class mail, postage prepaid, mailed not less than 15 nor more than 60 days prior to the applicable redemption date, to each Noteholder at such Noteholder's address appearing in the Equipment Note Register, provided that, in the case of a redemption to be made pursuant to Section 2.10(b) or Section 2.11, such notice shall be revocable and shall be deemed revoked in the event that the Lease does not in fact terminate on the specified termination date or if notice of such redemption shall have been given in connection with a refinancing of the Equipment Notes and Loan Trustee receives written notice of such revocation from Lessee or Owner Trustee not later than three days prior to the redemption date. All notices of redemption shall state: (1) the redemption date, (2) the applicable basis for determining the redemption price, (3) that on the redemption date, the redemption price will become due and payable upon each such Equipment Note, and that, if any such Equipment Notes are then outstanding, interest on such Equipment Notes shall cease to accrue on and after such redemption date and (4) the place or places where such Equipment Notes are to be surrendered for payment of the redemption price. (c) On or before the redemption date, Owner Trustee (or any Person on behalf of Owner Trustee) shall, to the extent an amount equal to the redemption price for the Equipment Notes to be redeemed or purchased on the redemption date shall not then be held in the Indenture Estate, deposit or cause to be deposited with Loan Trustee by 10:00 a.m. (New York City time) on the redemption date in immediately available funds the redemption price of the Equipment Notes to be redeemed or purchased. (d) Notice of redemption having been given as aforesaid (and not revoked or deemed revoked as contemplated in the proviso in the first sentence of Section 2.12(b)), the Equipment Notes to be redeemed or purchased shall, on the redemption date, become due and payable at the Corporate Trust Office of Loan Trustee, and from and after such redemption date (unless there is a default in the deposit of the redemption price pursuant to Section 2.12(c)) any such Equipment Notes then outstanding shall cease to bear interest. Upon surrender of any such Equipment Note for redemption in accordance with said notice, such Equipment Note shall be redeemed at the redemption price. Section 2.13 Subordination. (a) The indebtedness evidenced by the Series G-1 Equipment Notes and Series G-2 Equipment Notes shall rank in right of payment equally with all other Series G-1 Equipment Notes and Series G-2 Equipment Notes. The indebtedness evidenced by the Series C Equipment Notes is, to the extent and in the manner provided in this Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes, and the Series C Equipment Notes are issued subject to such provisions. By acceptance of its Equipment Notes of any Series, each Noteholder of such Series (i) agrees to and shall be bound by such provisions, (ii) authorizes and directs Loan Trustee on such Noteholder's behalf to take any action necessary or appropriate to effectuate the subordination as provided in this Indenture and (iii) appoints Loan Trustee as such Noteholder's attorney-in-fact for such purpose. (b) Owner Trustee, Loan Trustee and, by acceptance of its Equipment Notes of any Series, each Noteholder of such Series, hereby agree that no payment or distribution shall be made on or in respect of the Secured Obligations owed to such Noteholder of such Series, including any payment or distribution of cash, property or securities after the commencement of any proceedings of the type referred to in Section 4.02(g), except as expressly provided in Article III. (c) By the acceptance of its Equipment Notes of any Series, each Noteholder of such Series agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligations in respect of such Series that it is not entitled to receive under this Section 2.13 or Article III hereof, it will hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III. Section 2.14 Certain Payments. Owner Trustee agrees to pay to Loan Trustee for distribution in accordance with Section 3.04: (a) any and all indemnity amounts received by Owner Trustee which are payable by Lessee to (i) Loan Trustee in its individual capacity, (ii) Noteholders, (iii) Subordination Agent, (iv) Liquidity Provider, (v) Policy Provider, or (vi) Pass Through Trustees, in each case pursuant to Section 4.02 or 4.03 of the Participation Agreement; (b) an amount or amounts equal to the fees payable to Liquidity Provider under Section 2.03 of each Liquidity Facility and the related Fee Letter (as defined in the Intercreditor Agreement), multiplied by a fraction, the numerator of which is the sum of the then outstanding aggregate principal amount of the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes and the denominator of which is the sum of the then outstanding aggregate principal amount of all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement); (c) if any payment default shall have occurred and be continuing with respect to interest on any Series G-1 Equipment Note, Series G-2 Equipment Note or Series C Equipment Note, (x) the excess, if any, of (1) the amount equal to the sum of interest on any Unpaid Advance or Applied Provider Advance payable under Section 3.07 of each Liquidity Facility plus any other amounts payable in respect of such Unpaid Advance or Applied Provider Advance under Section 3.01, 3.03 or 3.09 of the Liquidity Facility under which such Unpaid Advance or Applied Provider Advance was made over (2) the sum of Investment Earnings from any Final Advance plus any amount of interest at the Past Due Rate actually payable (whether or not in fact paid) by Owner Trustee in respect of the overdue scheduled interest on the Equipment Notes, multiplied by (y) a fraction, the numerator of which is the then aggregate overdue amounts of interest on the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes (other than interest becoming due and payable solely as a result of acceleration of any such Equipment Notes) and the denominator of which is the then aggregate overdue amounts of interest on all "Series G-1 Equipment Notes", "Series G- 2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement) (other than interest becoming due and payable solely as a result of acceleration of any such "Equipment Notes"); (d) any amounts owed to Liquidity Provider by Subordination Agent as borrower under Section 3.01 (other than in respect of an Unpaid Advance or Applied Provider Advance), 3.03 (other than in respect of an Unpaid Advance or Applied Provider Advance), 7.05 and 7.07 of each Liquidity Facility multiplied by the fraction specified in the foregoing clause (b); (e) an amount or amounts equal to the compensation, including reasonable expenses and disbursements actually incurred, payable to Subordination Agent under Section 6.07 of the Intercreditor Agreement, multiplied by the fraction specified in the foregoing clause (b) (but in any event without duplication of any amount or amounts payable by Owner Trustee in respect of such compensation under any other Operative Document or Pass Through Document); (f) an amount or amounts equal to all compensation and reimbursement of fees, expenses and disbursements (including payment of indemnities) owed to Policy Provider under the Policy Provider Agreement, multiplied by the fraction specified in the foregoing clause (b); and (g) any and all amounts received by Owner Trustee which are payable by Lessee under clause (c) of the definition of Supplemental Rent. For purposes of this paragraph, the terms "Applied Provider Advance", "Cash Collateral Account", "Final Advance", "Investment Earnings", "Replacement Liquidity Facility" and "Unpaid Advance" have the meanings specified in each Liquidity Facility or the Intercreditor Agreement. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee. Any money held by Loan Trustee in trust for any payment of the principal of, Make-Whole Amount, if any, or interest or any other amounts due on, any Equipment Note, including, without limitation, any money deposited pursuant to Section 2.12(c), and remaining unclaimed for two years after the due date for such payment (or such lesser time as Loan Trustee is satisfied, after 60 days' notice from Owner Trustee, is one month prior to the escheat period provided under applicable state law) shall be paid to Owner Trustee. Noteholders of any outstanding Equipment Notes shall thereafter, as unsecured general creditors, look only to Owner Trustee for payment thereof, and all liability of Loan Trustee with respect to such trust money shall thereupon cease. Loan Trustee, before being required to make any such repayment, may at the expense of Owner Trustee cause to be mailed to each such Noteholder notice that such money remains unclaimed. After a date specified in such notice, which may not be less than 30 days from the date of mailing, any unclaimed balance of such money then remaining will be repaid to Owner Trustee as provided herein. Section 2.16 Directions by Subordination Agent. So long as Subordination Agent is a Noteholder, notwithstanding anything contained herein or in any other Operative Document to the contrary, in exercising its right to vote the Equipment Notes held by it, or in giving or taking any direction, consent, request, demand, instruction, authorization, notice, waiver or other action provided by this Indenture or in respect of the Equipment Notes to be given or taken by a Noteholder (each such vote or other action, a "Direction") in respect of such Equipment Notes, Subordination Agent may act in accordance with any votes, directions, consents, requests, demands, instructions, authorizations, notices, waivers or other actions given or taken by any applicable Pass Through Trustee or the Controlling Party pursuant to the Intercreditor Agreement, including without limitation pursuant to Section 2.06, Article IV or Section 8.01(b) thereof. Subordination Agent shall be permitted (x) to give a Direction with respect to less than the entire principal amount of any single Equipment Note held by it, and (y) to give different Directions with respect to different portions of the principal amount of any single Equipment Note held by it. Any Direction given by Subordination Agent at any time with respect to more than a majority in aggregate unpaid principal amount of all of the Equipment Notes issued and then outstanding hereunder shall be deemed to have been given by a Majority in Interest of Noteholders. Section 2.17 Assumption of Equipment Notes by Lessee. If, in accordance with the provisions of Section 6.01(k) of the Participation Agreement, Lessee shall be entitled to assume (on a full recourse basis) all of the obligations of Owner Trustee hereunder and under the Equipment Notes by a supplemental indenture satisfactory to Loan Trustee (which shall contain (i) the provisions substantially similar to Sections 6, 7, 8, 10, 11 and 12 of the Lease and (ii) other provisions necessary or advisable to effectuate such assumption), then upon delivery of such supplemental indenture, payment by Lessee of all expenses (including reasonable fees and expenses of counsel) for Owner Trustee and Owner Participant and delivery of an opinion of counsel for Lessee that such assumption has been duly and validly effected, Owner Trustee shall be released and discharged from any further obligations hereunder and under the Equipment Notes and all other Operative Documents, except with respect to such obligations that accrued prior thereto and Owner Participant shall be released and discharged from any further obligations under the Participation Agreement and any other Operative Document to which it is a party, except with respect to such obligations that accrued prior thereto. Section 2.18 Payments from Indenture Estate Only. (a) Without impairing any of the other rights, powers, remedies, privileges, liens or security interests of Noteholders under this Indenture, each Noteholder, by its acceptance of an Equipment Note, agrees that as between it and Owner Trustee, except as expressly provided in this Indenture, the Participation Agreement or any other Operative Document, (i) the obligation to make all payments of the principal amount of, interest on, Make-Whole Amount, if any, and all other amounts due with respect to the Equipment Notes, and the performance by Owner Trustee of every obligation or covenant contained in this Indenture and in the Participation Agreement or any of the other Operative Documents, shall be payable only from the income and proceeds from the Trust Estate to the extent included in the Indenture Estate and only to the extent that Owner Trustee shall have sufficient income or proceeds from the Trust Estate to the extent included in the Indenture Estate to enable Loan Trustee to make such payments in accordance with the terms of Article III hereof, and all of the statements, representations, covenants and agreements made by Owner Trustee (when made in such capacity) contained in this Indenture and any agreement referred to herein other than the Trust Agreement, unless expressly otherwise stated, are made and intended only for the purpose of binding the Trust Estate (to the extent included in the Indenture Estate) and establishing the existence of rights and remedies which can be exercised and enforced against the Trust Estate (to the extent included in the Indenture Estate); therefore, anything contained in this Indenture or such other agreements to the contrary notwithstanding (except for any express provisions or representations that Owner Trustee is responsible for, or is making, in its individual capacity, for which there would be personal liability of Owner Trustee), no recourse shall be had with respect to this Indenture or such other agreements against Owner Trustee in its individual capacity or against any institution or person which becomes a successor trustee or co-trustee or any officer, director, trustee, servant or direct or indirect parent or controlling Person or Persons of any of them, and (ii) none of Owner Trustee, in its individual capacity, Owner Participant, Loan Trustee and any officer, director, trustee, servant, employee, agent or direct or indirect parent or controlling Person or Persons of any of them shall have any personal liability for any amounts payable, or other obligation owed, hereunder, under the Participation Agreement or any of the other Operative Documents or under the Equipment Notes except as expressly provided herein or in the Participation Agreement; provided, however, that nothing contained in this Section 2.18(a) shall be construed to limit the exercise and enforcement in accordance with the terms of this Indenture or such other agreements of rights and remedies against the Trust Estate, to the extent included in the Indenture Estate. These provisions are not intended as any release or discharge of the indebtedness represented by the Equipment Notes and the Indenture, but are intended only as a covenant not to sue Owner Participant, Owner Trustee or Loan Trustee in their individual capacities, except as expressly provided herein or in the Participation Agreement, for a deficiency with respect to such indebtedness, the indebtedness represented by this Indenture and the Equipment Notes to remain in full force and effect as fully as though these provisions were not contained in this Indenture. Owner Trustee hereby acknowledges that Noteholders have expressly reserved all their rights and remedies against the Indenture Estate, including the right, in the event of a default in the payment of all or part of the principal amount of, interest on, Make-Whole Amount, if any, or any other amount due with respect to any Equipment Note within the periods provided for in Section 4.02 hereof, or upon the occurrence and continuation of any other Indenture Event of Default, to foreclose upon this Indenture, and/or to receive the proceeds from the Indenture Estate and otherwise to enforce any other right under this Indenture in accordance with the provisions hereof. Nothing in this Section 2.18(a) shall (x) release Owner Trustee or constitute a covenant not to sue Owner Trustee for any breach by it of any representations, warranties or covenants of Owner Trustee contained in the Operative Documents or (y) release Owner Trustee in its individual capacity from personal liability, or constitute a covenant not to sue Owner Trustee in its individual capacity for any breach by it of any representations, warranties or covenants of Owner Trustee made in its individual capacity in the Operative Documents. (b) If (i) all or any part of the Trust Estate becomes the property of, or Owner Trustee or Owner Participant becomes, a debtor subject to the reorganization provisions of the Bankruptcy Code, (ii) pursuant to such reorganization provisions, including Section 1111(b) of the Bankruptcy Code, Owner Trustee (in its individual capacity) or Owner Participant is required, by reason of Owner Trustee (in its individual capacity) or Owner Participant being held to have recourse liability to any Noteholder or Loan Trustee, directly or indirectly (other than the recourse liability of Owner Trustee (in its individual capacity), to make payment on account of any amount payable as principal, Make-Whole Amount, if any, interest or other amounts on the Equipment Notes or under this Indenture and (iii) any Noteholder or Loan Trustee actually receives any Excess Amount (as hereinafter defined) which reflects any payment by Owner Trustee (in its individual capacity) or Owner Participant on account of clause (ii) above, then such Noteholder or Loan Trustee, as the case may be, shall promptly refund to Owner Trustee (in its individual capacity) or Owner Participant (whichever shall have made such payment) such Excess Amount. For purposes of this Section 2.18(b), "Excess Amount" means the amount by which such payment exceeds the amount that would have been received by a Noteholder or Loan Trustee if Owner Trustee (in its individual capacity) or Owner Participant had not become subject to the recourse liability referred to in clause (ii) above. Nothing contained in this Section 2.18(b) shall prevent a Noteholder or Loan Trustee from enforcing any personal recourse obligation (and retaining the proceeds thereof) of Owner Trustee (in its individual capacity) or Owner Participant under the Participation Agreement or this Indenture (and any exhibits or annexes hereto or thereto) or by separate agreement or from retaining any amount paid by Owner Participant under Section 2.19 or 4.03 hereof. Section 2.19 Option to Purchase Equipment Notes. Either Owner Trustee or Owner Participant may, upon the events and subject to the terms and conditions and for the price set forth in this Section 2.19, purchase all but not less than all of the Equipment Notes outstanding hereunder, and each Noteholder agrees that it will, upon such events and subject to such terms and conditions and upon receipt of such price, sell, assign, transfer and convey to such purchaser or its nominee (without recourse or warranty of any kind except as to its title to the Equipment Notes and except against Liens on such Equipment Notes arising by, through or under such holder), all of the right, title and interest of such Noteholder in and to the Indenture Estate, this Indenture and the Equipment Notes held by it, and such purchaser or its nominee shall assume all of such holder's obligations arising subsequent to such sale under the Participation Agreement and hereunder. Such option to purchase the Equipment Notes may be exercised by Owner Trustee or Owner Participant upon any of the following events, and, in any such event, the purchase price thereof shall equal for each Equipment Note the aggregate unpaid principal amount thereof, plus accrued and unpaid interest thereon to the date of purchase and all other amounts (other than the Make-Whole Amount, except as provided in the next sentence) then payable hereunder or under the Participation Agreement to the holder thereof. Such option to purchase the Equipment Notes may be exercised: (i) upon a Loan Trustee Event or (ii) in the event there shall have occurred and be continuing a Lease Event of Default, provided that if such option is exercised pursuant to this clause (ii) at a time when there shall have occurred and be continuing for less than 180 days a Lease Event of Default, the purchase price thereof shall equal the price provided in the preceding sentence plus the Make-Whole Amount, if any. Such option to purchase the Equipment Notes may be exercised by Owner Trustee or Owner Participant giving written notice of its election of such option to Loan Trustee, which notice shall specify a date for such purchase not more than thirty (30) days or less than fifteen (15) days after the date of such notice. Loan Trustee shall not exercise any of the remedies hereunder or, without the consent of Owner Trustee or Owner Participant, under the Lease, during the period from the time that a notice of exercise by Owner Participant of such option to purchase becomes irrevocable until the date on which such purchase is required to occur pursuant to the terms of the preceding sentence. Such election to purchase the Equipment Notes shall become irrevocable upon the sixteenth day preceding the date specified in the written notice described in the first sentence of this paragraph. If Owner Trustee or Owner Participant on or before the date of such purchase shall so request, Noteholders will comply with all the provisions of Section 2.07 to enable new Equipment Notes to be issued to Owner Trustee or Owner Participant or its nominee in such denominations as Owner Trustee or Owner Participant shall request. All taxes, charges and expenses required pursuant to Section 2.09 in connection with the issuance of such new Equipment Note shall be borne by Owner Participant. ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE INDENTURE ESTATE Section 3.01 Basic Rent Distributions. Except as otherwise provided in Section 3.03, each installment of Basic Rent, any payment of interest on overdue installments of Basic Rent and any payment received by Loan Trustee pursuant to Section 4.03 shall be promptly distributed in the following order of priority: first, (i) so much of such installment or payment as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and any other overdue amounts) then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series G-1 Equipment Note or Series G-2 Equipment Note bears to the aggregate amount of the payments then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes; and (ii) after giving effect to paragraph (i) above, so much of such installment or payment remaining as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and other overdue amounts) then due under all Series C Equipment Notes shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series C Equipment Note bears to the aggregate amount of the payments then due under all Series C Equipment Notes; and second, the balance, if any, of such installment remaining thereafter shall be distributed to Owner Trustee, provided, however that if an Indenture Event of Default shall have occurred and be continuing, then such balance shall not be distributed as provided in this clause "Second" but shall be held by Loan Trustee as part of the Indenture Estate and invested in accordance with Section 5.09 until whichever of the following shall first occur: (i) all Indenture Events of Default shall have been cured or waived, in which event the balance shall be distributed as provided in this clause "Second" without reference to this proviso, (ii) Section 3.03 shall be applicable, in which event such balance shall be distributed in accordance with the provisions of Section 3.03 or (iii) the 120th day after the receipt of such payment in which case such payment shall be distributed as provided in this clause "Second" without reference to this proviso. Section 3.02 Event of Loss; Voluntary Termination; Refinancing. Except as otherwise provided in Section 3.03, any payments received by Loan Trustee (a) with respect to the Aircraft as the result of an Event of Loss, (b) pursuant to a voluntary termination of the Lease pursuant to Section 9 or 19(d) thereof or (c) in connection with a refinancing of the Equipment Notes pursuant to Section 13.01 of the Participation Agreement shall be applied to redemption of the Equipment Notes pursuant to Section 2.10 or Section 2.11, as applicable, and to payment of all other Secured Obligations by applying such funds in the following order of priority: first, (i) to reimburse Loan Trustee and Noteholders for any reasonable costs or expenses actually incurred in connection with such redemption for which they are entitled to reimbursement, or indemnity by Lessee, under the Operative Documents; and then (ii) to pay any other amounts then due (except as provided in clause "second" below) to Loan Trustee, Noteholders and Indenture Indemnitees under this Indenture, the Participation Agreement or the Equipment Notes; second, (i) to pay the amounts specified in subclause (i) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series G-1 Equipment Notes and the Series G-2 Equipment Notes; and (ii) after giving effect to subclause (i) above, to pay the amounts specified in subclause (ii) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series C Equipment Notes; and third, the balance, if any, of such payments shall be distributed to Owner Trustee. Notwithstanding the foregoing, if a Replacement Airframe or Replacement Engine shall be substituted for the Airframe or an Engine subject to such Event of Loss as provided in Section 10 of the Lease and Section 5.06, any insurance, condemnation or similar proceeds resulting from such Event of Loss that are received by Loan Trustee shall be held by Loan Trustee as permitted by Section 6.04 (provided that such money shall be invested as provided in Section 5.09) as additional security for the obligations of Lessee under the Operative Documents to which it is a party and, unless otherwise applied pursuant to the Lease, such money (and any investment earnings) shall be released to Lessee at Lessee's written request upon the release of a damaged Airframe or Engine and the replacement thereof as provided in the Lease. No Make-Whole Amount shall be payable on the Equipment Notes in connection with their redemption as a result of an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon. Section 3.03 Payments after Indenture Event of Default. Except as otherwise provided in Section 3.04, all payments received and amounts held or realized by Loan Trustee (including any amounts realized by Loan Trustee from the exercise of any remedies pursuant to Section 15 of the Lease or Article IV hereof) after both an Indenture Event of Default shall have occurred and be continuing and the Equipment Notes shall have become due and payable pursuant to Section 4.04(b) or Section 4.04(d), as well as all payments or amounts then held by Loan Trustee as part of the Indenture Estate, shall be promptly distributed by Loan Trustee in the following order of priority: first, so much of such payments or amounts as is required to (i) reimburse Loan Trustee, to the extent Loan Trustee is entitled to be reimbursed or indemnified under the Operative Documents, for any Tax, expense or other loss (including, without limitation, all amounts to be expended at the expense of, or charged upon the tolls, rents, revenues, issues, products and profits of, the Indenture Estate and every part thereof (all such property being herein called the "Mortgaged Property") pursuant to Section 4.05(b)) actually incurred by Loan Trustee (to the extent not previously reimbursed), the expenses of any sale, taking or other proceeding, reasonable attorneys' fees and expenses, court costs and any other expenditures actually incurred or expenditures or advances made by Loan Trustee or Noteholders in the protection, exercise or enforcement of any right, power or remedy or any damages sustained by Loan Trustee or any Noteholder, liquidated or otherwise, upon such Indenture Event of Default shall be applied by Loan Trustee as between itself and Noteholders in reimbursement of such expenses and any other expenses for which Loan Trustee or Noteholders are entitled to reimbursement under any Operative Document, and (ii) to pay all amounts payable (except as provided in clauses "second" and "third" below) to the other Indenture Indemnitees hereunder and under the Participation Agreement; and in case the aggregate amount so to be distributed is insufficient to pay as aforesaid, then ratably, without priority of one over the other, in proportion to the amounts owed each hereunder; second, so much of such payments or amounts remaining as is required to reimburse the then existing or prior Noteholders for payments made pursuant to Section 5.03 (to the extent not previously reimbursed) shall be distributed to such then existing or prior Noteholders ratably, without priority of one over the other, in accordance with the amount of the payment or payments made by each such then existing or prior Noteholder pursuant to Section 5.03; third, (i) so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes to the date of distribution shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and (ii) after giving effect to subclause (i) above, so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series C Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series C Equipment Notes to the date of distribution shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series C Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series C Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and fourth, the balance, if any, of such payments or amounts shall be distributed to Owner Trustee. No Make-Whole Amount shall be payable on the Equipment Notes as a consequence of or in connection with the acceleration of the Equipment Notes. Section 3.04 Certain Payments. (a) Any payments received by Loan Trustee for which provision as to the application thereof is made in this Indenture other than in this Article III shall be applied as provided in those provisions. Without limiting the foregoing, any payments received by Loan Trustee which are payable to Owner Trustee or Lessee pursuant to any of the provisions of this Indenture other than those set forth in this Article III (including Section 5.09 hereof) shall be so paid to Owner Trustee or Lessee, as applicable. Any payments received by Loan Trustee for which no provision as to the application thereof is made in this Indenture and for which such provision is made in any other Operative Document shall be applied forthwith to the purpose for which such payment was made in accordance with the terms of such other Operative Document. (b) Loan Trustee will distribute promptly upon receipt any indemnity payment received by it from Owner Trustee or Lessee whether pursuant to Section 4.02 or Section 4.03 of the Participation Agreement or as Supplemental Rent in respect of (i) State Street and Loan Trustee, (ii) Subordination Agent, (iii) Pass Through Trustees, (iv) Liquidity Provider and (v) Policy Provider, in each case, directly to the Person entitled thereto. Any payment received by Loan Trustee from Owner Trustee under clauses (b) through (f) of Section 2.14 shall be distributed to Subordination Agent to be distributed pursuant to Section 2.03(c) of the Intercreditor Agreement. (c) Notwithstanding anything to the contrary contained in this Article III, any amounts received by Loan Trustee which constitute Excluded Payments shall be distributed promptly upon receipt by Loan Trustee directly to the Person or Persons entitled thereto. (d) Notwithstanding any provision of this Indenture to the contrary, any amounts held by Loan Trustee that would, but for the provisions of Section 3.03, otherwise be distributed to Lessee shall, notwithstanding the provisions of said Section, be distributed to Lessee unless and until a Lease Event of Default shall have occurred and be continuing. Section 3.05 Other Payments. Any payments received by Loan Trustee for which no provision as to the application thereof is made in any Operative Document shall be distributed by Loan Trustee to the extent received or realized at any time (i) prior to the payment in full of all Secured Obligations due Noteholders, in the order of priority specified in Section 3.01 subject to the proviso thereto, and (ii) after payment in full of all Secured Obligations due Noteholders, in the following order of priority: first, to the extent payments or amounts described in clause "first" of Section 3.03 are otherwise obligations of Lessee under the Operative Documents or for which Lessee is obligated to indemnify against thereunder, in the manner provided in clause "first" of Section 3.03, and second, in the manner provided in clause "fourth" of Section 3.03. Further, and except as otherwise provided in Sections 3.02, 3.03 and 3.04, all payments received and amounts realized by Loan Trustee under the Lease or otherwise with respect to the Aircraft (including, without limitation, all amounts realized upon the sale or re-lease of the Aircraft after the termination of the Lease with respect thereto), to the extent received or realized at any time after payment in full of all Secured Obligations due Noteholders, shall be distributed by Loan Trustee in the order of priority specified in clause (ii) of the immediately preceding sentence of this Section 3.05. Section 3.06 Payments to Owner Trustee. Any amounts distributed hereunder by Loan Trustee to Owner Trustee shall be paid to Owner Trustee (within the time limits contemplated by Section 2.03) by wire transfer of funds of the type received by Loan Trustee at such office and to such account or accounts of such entity or entities as shall be designated by notice from Owner Trustee to Loan Trustee from time to time. Owner Trustee hereby notifies Loan Trustee that unless and until Loan Trustee receives notice to the contrary from Owner Trustee, all amounts to be distributed to Owner Trustee pursuant to clause "second" of Section 3.01 shall be distributed by wire transfer of funds of the type received by Loan Trustee to Owner Participant's account (within the time limits contemplated by Section 2.03) specified in Section 16.12 of the Participation Agreement. ARTICLE IV COVENANTS OF OWNER TRUSTEE; INDENTURE EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Covenants of Owner Trustee. Owner Trustee hereby covenants and agrees (the covenants and agreements only in clause (b) below being made by Owner Trustee in its individual capacity) as follows: (a) Owner Trustee will duly and punctually pay the principal amount of, Make-Whole Amount, if any, and interest on and other amounts due under the Equipment Notes and hereunder in accordance with the terms of the Equipment Notes and this Indenture and all amounts, if any, payable by it to Noteholders under the Participation Agreement; (b) Owner Trustee in its individual capacity covenants and agrees that it shall not, directly or indirectly, cause or permit to exist a Lessor Lien attributable to it in its individual capacity with respect to the Aircraft or any other portion of the Trust Estate; that it will promptly, at its own expense, take such action as may be necessary to duly discharge such Lessor Lien attributable to it in its individual capacity; and that it will make restitution to the Trust Estate for any actual diminution of the assets of the Trust Estate resulting from such Lessor Liens attributable to it in its individual capacity; (c) in the event Owner Trustee shall have Actual Knowledge of an Indenture Event of Default, an Indenture Default or an Event of Loss, Owner Trustee will give prompt written notice of such Indenture Event of Default, Indenture Default or Event of Loss to Loan Trustee, each Noteholder, Lessee and Owner Participant; (d) Owner Trustee will furnish to Loan Trustee, promptly upon receipt thereof, duplicates or copies of all reports, notices, requests, demands, certificates and other instruments furnished to Owner Trustee under the Lease, including, without limitation, a copy of any Termination Notice and a copy of each report or notice received pursuant to Section 9(a) and 11(c) of the Lease to the extent that the same shall not have been furnished to Loan Trustee pursuant to the Lease; (e) except pursuant to the Operative Documents or with the consent of Loan Trustee (acting pursuant to instructions given in accordance with Section 9.01 hereof), Owner Trustee will not contract for, create, incur, assume or suffer to exist any Debt, and will not guarantee (directly or indirectly or by an instrument having the effect of assuring another's payment or performance on any obligation or capability of so doing, or otherwise), endorse or otherwise be or become contingently liable, directly or indirectly, in connection with the Debt of any other person; and (f) Owner Trustee will not enter into any business or other activity other than the business of owning the Aircraft, the leasing thereof to Lessee and the carrying out of the transactions contemplated hereby and by the Lease, the Participation Agreement, the Trust Agreement and the other Operative Documents. Section 4.02 Indenture Events of Default. Each of the following events constitutes an "Indenture Event of Default" whether such event is voluntary or involuntary or comes about or is effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body: (a) any Lease Event of Default; (b) Owner Trustee fails to make any payment of principal amount of, Make-Whole Amount, if any, interest on or other amount due and payable under any Equipment Note or hereunder (other than any such failure arising by virtue of a tax withheld pursuant to Section 2.04 or as a result of a Lease Default or a Lease Event of Default) and such failure continues unremedied for 15 days in the case of any payment of principal amount, Make-Whole Amount, if any, or interest, and in the case of any other amount, such failure continues unremedied for 15 days after the receipt by Owner Trustee or Owner Participant of written notice thereof from Loan Trustee or any Noteholder; (c) any Lien required to be discharged by Owner Trustee, in its individual capacity pursuant to Section 4.01(b) or in its individual or trust capacity pursuant to Section 6.01(g) of the Participation Agreement, or by Owner Participant pursuant to Section 6.01(g) of the Participation Agreement shall remain undischarged for a period of 30 days after Owner Trustee and Owner Participant have received written notice from Loan Trustee or any Noteholder of such Lien; (d) any representation or warranty made by Owner Trustee or Owner Participant in any Operative Document was incorrect in any material respect at the time made, and such incorrectness continues to be material and adverse to the interests of Loan Trustee or Noteholders; and if such misrepresentation is capable of being corrected and if such correction is being sought diligently, such misrepresentation shall not have been corrected within 60 days (or, without affecting Section 4.02(f), in the case of the representations made in Sections 5.03(l) and 5.02(g) of the Participation Agreement as to the citizenship of Owner Trustee in its individual capacity or Owner Participant, respectively, as soon as is reasonably practicable but in any event within 60 days) following notice thereof from Loan Trustee or any Noteholder to Owner Trustee or Owner Participant, as the case may be; (e) other than as provided in (c) above or (f) below), any failure by Owner Trustee or Owner Participant to observe or perform any other covenant or obligation of Owner Trustee or Owner Participant, as the case may be, for the benefit of Loan Trustee or Noteholders contained in the Participation Agreement, Section 4.01(a) of the Trust Agreement, the Equipment Notes or this Indenture which is not remedied within a period of 60 days after notice thereof has been given to Owner Trustee and Owner Participant; (f) if at any time when the Aircraft is registered under the laws of the United States, Owner Participant shall not be a Citizen of the United States, and as the result thereof the registration of the Aircraft under the Federal Aviation Act, and regulations then applicable thereunder, shall cease to be effective; provided that no Indenture Event of Default shall be deemed to have occurred under this paragraph (f) unless such circumstances continue unremedied for more than 60 days after Owner Participant has Actual Knowledge of the state of facts that resulted in such ineffectiveness and of such loss of citizenship; (g) at any time either (i) the commencement of an involuntary case or other proceeding in respect of Owner Participant, Owner Trustee or the Trust Estate in an involuntary case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law in the United States or seeking the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official of Owner Participant, Owner Trustee or the Trust Estate or for all or substantially all of its property, or seeking the winding-up or liquidation of its affairs and the continuation of any such case or other proceeding undismissed and unstayed for a period of 90 consecutive days; or (ii) the commencement by Owner Participant, Owner Trustee or the Trust Estate of a voluntary case or proceeding under the federal bankruptcy laws, as now or constituted or hereafter amended, or any other applicable federal or state bankruptcy, insolvency or other similar law in the United States, or the consent by Owner Participant, Owner Trustee or the Trust Estate to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Owner Participant, Owner Trustee or the Trust Estate or for all or substantially all of its property, or the making by Owner Participant, Owner Trustee or the Trust Estate of any assignment for the benefit of creditors of Owner Participant or Owner Trustee or the Trust Estate shall take any action to authorize any of the foregoing; provided, however, that an event referred to in this Section 4.02(g) with respect to Owner Participant shall not constitute an Indenture Event of Default if within 30 days of the commencement of the case or proceeding a final non-appealable order, judgment or decree shall be entered in such case or proceeding by a court or a trustee, custodian, receiver or liquidator, to the effect that no part of the Trust Estate (except for Owner Participant's beneficial interest therein) and no right, title or interest under the Indenture Estate shall be included in, or be subject to, any declaration or adjudication of, or proceedings with respect to, the bankruptcy, insolvency or liquidation of Owner Participant referred to in this Section 4.02(g). Section 4.03 Certain Rights. Loan Trustee shall give Noteholders, Owner Trustee and Owner Participant prompt written notice of any Indenture Event of Default (regardless of a cure thereof) of which Loan Trustee has Actual Knowledge and, if any such Indenture Event of Default results from a Lease Event of Default, shall give Noteholders, Owner Trustee and Owner Participant not less than 10 Business Days' prior written notice of the date (the "Enforcement Date") on or after which Loan Trustee may commence and consummate the exercise of any remedy or remedies described in Section 4.04, 4.05 or 4.06 hereof, or the exercise of any remedy or remedies pursuant to the provisions of Section 15 of the Lease. If an Indenture Event of Default shall have occurred and be continuing, Owner Trustee shall have the following rights hereunder, any of which may be exercised directly by Owner Participant. If as a result of the occurrence of an Indenture Event of Default in respect of the nonpayment by Lessee of Basic Rent due under the Lease, Loan Trustee shall have insufficient funds to make any payment of principal amount and interest on any Equipment Note on the day it becomes due and payable, Owner Trustee or Owner Participant may, but shall not be obligated to, pay Loan Trustee prior to the Enforcement Date, in the manner provided in Section 2.03 hereof, for application in accordance with Section 3.01 hereof, an amount equal to the portion of the principal amount and interest (including interest, if any, on any overdue payments of such portion of principal amount and interest) then due and payable on the Equipment Notes, and, unless Owner Trustee has cured Indenture Events of Default in respect of payments of Basic Rent on each of the three immediately preceding Basic Rent payment dates, or Owner Trustee has cured six previous Indenture Events of Default in respect of payments of Basic Rent, such payment by Owner Trustee shall, solely for purposes of this Indenture be deemed to cure any Indenture Event of Default which would otherwise have arisen on account of the nonpayment by Lessee of such installment of Basic Rent (but not any other Indenture Default or Indenture Event of Default which shall have occurred and be continuing). If any Indenture Event of Default (other than in respect of the nonpayment of Basic Rent by Lessee) which can be cured has occurred, Owner Trustee or Owner Participant may, but shall not be obligated to, cure such Indenture Event of Default by taking such action prior to the Enforcement Date as is necessary to accomplish the observance or performance of the defaulted covenant, condition or agreement. Solely for the purpose of determining whether there exists an Indenture Event of Default, (a) any payment by Owner Participant pursuant to, and in compliance with, the second preceding paragraph of this Section 4.03 shall be deemed to remedy any default by Lessee in the payments of installments of Basic Rent theretofore due and payable and to remedy any default by Owner Trustee in the payment of any amount due and payable under the Equipment Notes or hereunder (but the same shall not relieve Lessee of its duty to pay all Rent and perform all of its obligations pursuant to the Lease), and (b) any performance by Owner Trustee of any obligation of Lessee under the Lease pursuant to, and in compliance with, the first preceding paragraph of this Section 4.03 shall be deemed to remedy any Lease Event of Default to the same extent that like performance by Lessee itself would have remedied such Lease Event of Default (but the same shall not relieve Lessee of its duty to pay all Rent and perform all of its obligations pursuant to the Lease). If, on the basis specified in the preceding sentence, any Lease Event of Default shall have been remedied, then any declaration pursuant to Section 15 of the Lease that the Lease is in default, and any declaration pursuant to this Indenture that the Equipment Notes are due and payable or that an Indenture Event of Default exists based upon such Lease Event of Default, shall be deemed to be rescinded. Except as hereinafter in this Section 4.03 provided, Owner Trustee shall not, as a result of exercising the right to cure any such Indenture Event of Default, obtain any Lien on any of the Mortgaged Property or any Rent payable under the Lease for or on account of costs or expenses incurred in connection with the exercise of such right, nor shall any claim of Owner Trustee against Lessee or any other party for the repayment of such costs or expenses impair the prior right and security interest of Loan Trustee in and to the Mortgaged Property. Upon any payment by Owner Trustee or Owner Participant pursuant to the second or third preceding paragraphs of this Section 4.03, Owner Trustee or Owner Participant, as the case may be, shall be subrogated to the rights of Loan Trustee and Noteholders in respect of the Basic Rent which was overdue at the time of such payment and interest payable by Lessee on account of its being overdue and any Supplemental Rent in respect of the reimbursement of amounts paid by Owner Trustee pursuant to the second preceding paragraph (but in either case shall have no rights as a secured party hereunder), and thereafter, Owner Trustee or Owner Participant, as the case may be, shall be entitled to receive such overdue Basic Rent or Supplemental Rent, as the case may be, and interest thereon upon receipt thereof by Loan Trustee (and shall be entitled to bring an action against Lessee to enforce such payment); provided, however, that (i) if the unpaid principal amount and interest on the Equipment Notes shall have become due and payable pursuant to Section 4.04 hereof, such subrogation shall, until the principal amount of, interest on, Make-Whole Amount, if any, and all other amounts due with respect to all Equipment Notes shall have been paid in full, be subordinate to the rights of Loan Trustee and Noteholders in respect of such payment of overdue Basic Rent, Supplemental Rent and such interest and (ii) Owner Trustee shall not be entitled to seek to recover any such payment (or any payment in lieu thereof) except pursuant to the foregoing right of subrogation by demand or suit for damages. Section 4.04 Remedies. (a) Subject to the provisions of Section 2.19, if an Indenture Event of Default has occurred and is continuing and so long as the same shall continue unremedied, then and in every such case Loan Trustee may, subject to the second paragraph of this Section 4.04(a), on and after the Enforcement Date if such Indenture Event of Default results from a Lease Event of Default, exercise any or all of the rights and powers and pursue any and all of the remedies pursuant to this Article IV and shall have and may exercise all of the rights and remedies of a secured party under the Uniform Commercial Code and, in the event such Indenture Event of Default is also a Lease Event of Default, any and all of the remedies pursuant to Section 15 of the Lease and may take possession of all or any part of the properties covered or intended to be covered by the Lien created hereby or pursuant hereto and may exclude Owner Participant, Owner Trustee and Lessee and all persons claiming under any of them wholly or partly therefrom, provided that Loan Trustee shall give Owner Trustee and Owner Participant 20 days' prior written notice of its intention to sell the Aircraft; provided, further, that in the event Loan Trustee shall have validly terminated the Lease (or, in the event of a reorganization proceeding involving Lessee instituted under Chapter 11 of the Bankruptcy Code, such Lease is rejected), Loan Trustee shall not, without the consent of Owner Participant (which consent shall not be unreasonably withheld), sell or lease, or otherwise afford the use of, the Aircraft or any portion thereof to Lessee or any affiliate thereof. Unless an Indenture Event of Default not resulting from or relating to a Lease Event of Default has occurred and is continuing, Owner Participant may bid at any public sale and become the purchaser. Without limiting any of the foregoing, it is understood and agreed that Loan Trustee may exercise any right of sale of the Aircraft available to it, even though it shall not have taken possession of the Aircraft and shall not have possession thereof at the time of such sale. Anything in this Indenture to the contrary notwithstanding, Loan Trustee shall not be entitled to exercise any remedy hereunder as a result of an Indenture Event of Default which arises solely by reason of one or more events or circumstances which constitute a Lease Event of Default unless Loan Trustee as security assignee of Owner Trustee shall have exercised or concurrently be exercising one or more of the remedies provided for in Section 15 of the Lease to terminate the Lease or take possession of and/or sell the Aircraft; provided, however, that such requirement to exercise one or more of such remedies under the Lease shall not apply in circumstances where Loan Trustee is, and has been, for a continuous period in excess of 60 days or such other period as may be specified in Section 1110 (such 60-day or other period being the "Section 1110 Period"), involuntarily stayed or prohibited by applicable law or court order from exercising such remedies under the Lease (a "Continuous Stay Period"); provided further, however, that the requirement to exercise one or more of such remedies under the Lease shall nonetheless be applicable during a Continuous Stay Period subsequent to the expiration of the Section 1110 Period to the extent that the continuation of such Continuous Stay Period subsequent to the expiration of the Section 1110 Period (i) results from an agreement by the trustee or the debtor-in-possession in such proceeding during the Section 1110 Period with the approval of the relevant court to perform the Lease in accordance with Section 1110(a)(2)(A) of the Bankruptcy Code and continues to perform as required by Section 1110(a)(2)(A-B) of the Bankruptcy Code or (ii) is an extension of the Section 1110 Period with the consent of Loan Trustee pursuant to Section 1110(b) of the Bankruptcy Code or (iii) is the consequence of Loan Trustee's own failure to give any requisite notice to any Person. In the event that the applicability of Section 1110 to the Aircraft is being contested by Lessee in judicial proceedings, both Loan Trustee and Owner Trustee (without affecting in any way any right or remedy of Loan Trustee hereunder) shall have the right to participate in such proceedings. It is expressly understood and agreed that, subject only to the immediately preceding paragraph, the inability, described in such paragraphs, of Loan Trustee to exercise any right or remedy under the Lease shall in no event and under no circumstances prevent Loan Trustee from exercising any or all of its rights, powers and remedies under this Indenture, including, without limitation, this Article IV. (b) If an Indenture Event of Default shall have occurred and be continuing, then and in every such case Loan Trustee may, and upon the written instructions of a Majority in Interest of Noteholders, Loan Trustee shall, subject to Section 4.03, at any time, declare by written notice to Owner Trustee and Owner Participant all the Equipment Notes to be due and payable, whereupon the aggregate unpaid principal amount of all Equipment Notes then outstanding, together with accrued but unpaid interest thereon and other amounts due thereunder (but without Make-Whole Amount), shall immediately become due and payable without presentment, demand, protest or notice, all of which are hereby waived. This Section 4.04(b), however, is subject to the condition that, if at any time after the principal amount of the Equipment Notes shall have become so due and payable, and before any judgment or decree for the payment of the money so due, or any thereof, shall be entered, all overdue payments of interest upon the Equipment Notes and all other amounts payable under the Equipment Notes (except the principal amount of the Equipment Notes which by such declaration shall have become payable) shall have been duly paid, and every other Indenture Default and Indenture Event of Default with respect to any covenant or provision of this Indenture shall have been cured, then and in every such case a Majority in Interest of Noteholders may (but shall not be obligated to), by written instrument filed with Indenture Trustee, rescind and annul Loan Trustee's declaration and its consequences; but no such rescission or annulment shall extend to or affect any subsequent Indenture Default or Indenture Event of Default or impair any right consequent thereon. (c) Any Noteholder or Noteholders shall be entitled to bid for and become the purchaser of any part of the Indenture Estate offered for sale pursuant to this Section 4.04 and to credit against the purchase price bid at such sale by such Noteholders all or any part of the unpaid amounts owing to such Noteholders under the Operative Documents and secured by the Lien of this Indenture (but only to the extent that such purchase price would have been paid to such Noteholders pursuant to Article III if such purchase price were paid in cash and the foregoing provision of this Section 4.04(c) were not given effect). (d) In the event of any sale of the Indenture Estate, or any part thereof, pursuant to any judgment or decree of any court or otherwise in connection with the enforcement of any of the terms of this Indenture, the unpaid principal amount of all Equipment Notes then outstanding, together with accrued interest thereon, and other amounts due thereunder, shall immediately become due and payable without presentment, demand, protest or notice, all of which are hereby waived. (e) Notwithstanding anything contained herein, so long as Pass Through Trustee under any Pass Through Trust Agreement or Subordination Agent on its behalf is a Noteholder, Loan Trustee will not be authorized or empowered to acquire title to any part of the Indenture Estate or take any action with respect to any part of the Indenture Estate so acquired by it if such acquisition or action would cause any Pass Through Trust to fail to qualify as a "grantor trust" for federal income tax purposes. Section 4.05 Return of Aircraft. (a) If an Indenture Event of Default shall have occurred and be continuing, subject to Sections 4.03 and 4.04 hereof, at the request of Loan Trustee, Owner Trustee shall promptly execute and deliver to Loan Trustee such instruments of title and other documents as Loan Trustee may deem necessary or advisable to enable Loan Trustee or an agent or representative designated by Loan Trustee, at such time or times and place or places as Loan Trustee may specify, to obtain possession of all or any part of the Mortgaged Property included in the Indenture Estate to which Loan Trustee shall at the time be entitled hereunder. If Owner Trustee shall for any reason fail to execute and deliver such instruments and documents after such request by Loan Trustee, Loan Trustee may (i) obtain a judgment conferring on Loan Trustee the right to immediate possession and requiring Owner Trustee to execute and deliver such instruments and documents to Loan Trustee, to the entry of which judgment Owner Trustee hereby specifically consents to the fullest extent permitted by applicable law, and (ii) pursue all or part of such Mortgaged Property wherever it may be found and, in the event that a Lease Event of Default has occurred and is continuing, may enter any of the premises of Lessee wherever such Mortgaged Property may be or be supposed to be and search for such Mortgaged Property and take possession of and remove such Mortgaged Property. All expenses of obtaining such judgment or of pursuing, searching for and taking such property shall, until paid, be secured by the Lien of this Indenture. (b) Upon every such taking of possession, Loan Trustee may, from time to time, at the expense of the Mortgaged Property, make all such expenditures for maintenance, use, operation, storage, insurance, leasing, control, management, disposition, modifications or alterations to and of the Mortgaged Property, as it may deem proper. In each such case, Loan Trustee shall have the right to maintain, use, operate, store, insure, lease, control, manage, dispose of, modify or alter the Mortgaged Property and to carry on the business and to exercise all rights and powers of Owner Participant and Owner Trustee relating to the Mortgaged Property, as Loan Trustee shall deem best, including the right to enter into any and all such agreements with respect to the maintenance, use, operation, storage, insurance, leasing, control, management, disposition, modification or alteration of the Mortgaged Property or any part thereof as Loan Trustee may determine, and Loan Trustee shall be entitled to collect and receive directly all tolls, rents (including Rent), revenues, issues, income, products and profits of the Mortgaged Property and every part thereof, except Excluded Payments, without prejudice, however, to the right of Loan Trustee under any provision of this Indenture to collect and receive all cash held by, or required to be deposited with, Loan Trustee hereunder. Such tolls, rents (including Rent), revenues, issues, income, products and profits shall be applied to pay the expenses of the maintenance, use, operation, storage, insurance, leasing, control, management, disposition, improvement, modification or alteration of the Mortgaged Property and of conducting the business thereof, and to make all payments which Loan Trustee may be required or may elect to make, if any, for taxes, assessments, insurance or other proper charges upon the Mortgaged Property or any part thereof (including the employment of engineers and accountants to examine, inspect and make reports upon the properties and books and records of Owner Trustee), and all other payments which Loan Trustee may be required or authorized to make under any provision of this Indenture, as well as just and reasonable compensation for the services of Loan Trustee, and of all persons properly engaged and employed by Loan Trustee with respect hereto. Section 4.06 Remedies Cumulative. To the extent permitted under applicable law, each and every right, power and remedy specifically given to Loan Trustee herein or otherwise in this Indenture shall be cumulative and shall be in addition to every other right, power and remedy specifically given herein or now or hereafter existing at law, in equity or by statute, and each and every right, power and remedy whether specifically given herein or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by Loan Trustee, 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 Loan Trustee in the exercise of any right, remedy or power or in the pursuance of any remedy shall, to the extent permitted by applicable law, impair any such right, power or remedy or be construed to be a waiver of any default on the part of Owner Trustee or Lessee or to be an acquiescence therein. Section 4.07 Discontinuance of Proceedings. In case Loan Trustee has instituted any proceedings to enforce any right, power or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings have been discontinued or abandoned for any reason or have been determined adversely to Loan Trustee, then and in every such case Owner Trustee, Lessee and Loan Trustee shall, subject to any determination in such proceedings, be restored to their former positions and rights hereunder with respect to the Indenture Estate, and all rights, remedies and powers of Loan Trustee shall continue as if no such proceedings had been undertaken (but otherwise without prejudice). Section 4.08 Waiver of Past Defaults. Upon written instruction from a Majority in Interest of Noteholders, Loan Trustee shall waive any past default hereunder and its consequences, and upon any such waiver such default shall cease to exist and any Indenture Event of Default arising therefrom shall be deemed to have been cured for every purpose of the Operative Documents, but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon; provided, however, that in the absence of written instructions from each of the affected Noteholders, Loan Trustee shall not waive any default (i) in the payment of the principal amount, Make-Whole Amount, if any, or interest due under any Equipment Note then outstanding (other than with the consent of the holder thereof), or (ii) in respect of a covenant or provision hereof which, under Article IX, cannot be modified or amended without the consent of each such affected Noteholder. Section 4.09 Appointment of a Receiver. Loan Trustee shall, as a matter of right, be entitled to the appointment of a receiver (who may be Loan Trustee or any successor or nominee thereof) for all or any part of the Mortgaged Property, whether such receivership be incidental to a proposed sale of the Mortgaged Property or the taking of possession thereof or otherwise, and Owner Trustee hereby consents to the appointment of such a receiver and will not oppose any such appointment. Any receiver appointed for all or any part of the Mortgaged Property shall be entitled to exercise all the rights and powers of Loan Trustee with respect to the Mortgaged Property. Section 4.10 Loan Trustee Authorized to Execute Bills of Sale, Etc. Owner Trustee irrevocably appoints Loan Trustee the true and lawful attorney-in-fact of Owner Trustee in its name and stead and on its behalf, for the purpose, if an Event of Default shall have occurred and be continuing, of effectuating any sale, assignment, transfer or delivery for the enforcement of the Lien of this Indenture in accordance with the terms hereof, whether pursuant to foreclosure or power of sale, assignments and other instruments as may be necessary or appropriate, with full power of substitution, Owner Trustee hereby ratifying and confirming all that such attorney or any substitute shall do by virtue hereof in accordance with applicable law. Nevertheless, if so requested by Loan Trustee or any purchaser, Owner Trustee shall ratify and confirm any such sale, assignment, transfer or delivery, by executing and delivering to Loan Trustee or such purchaser all bills of sale, assignments, releases and other proper instruments to effect such ratification and confirmation as may be designated in any such request. Section 4.11 Rights of Noteholders to Receive Payment. Notwithstanding any other provision of this Indenture, the right of any Noteholder to receive payment of principal of, and Make-Whole Amount, if any, and interest on an Equipment Note on or after the respective due dates expressed in such Equipment Note, or to bring suit for the enforcement of any such payment on or after such respective dates in accordance with the terms hereof, shall not be impaired or affected without the consent of such Noteholder. Section 4.12 Noteholders May Not Bring Suit Except Under Certain Conditions. A Noteholder of any Series shall not have the right to institute any suit, action or proceeding at law or in equity or otherwise with respect to this Indenture for the appointment of a receiver or for the enforcement of any other remedy under this Indenture, unless: (1) such Noteholder previously shall have given written notice to Loan Trustee of a continuing Indenture Event of Default; (2) A Majority in Interest of Noteholders shall have requested Loan Trustee in writing to institute such action, suit or proceeding and shall have offered to Loan Trustee indemnity as provided in Section 5.03; (3) Loan Trustee shall have refused or neglected to institute any such action, suit or proceeding for 60 days after receipt of such notice, request and offer of indemnity; and (4) no direction inconsistent with such written request shall have been given to Loan Trustee during such 60-day period by a Majority in Interest of Noteholders. Except to the extent provided in the Intercreditor Agreement or in any Indenture Supplement, it is understood and intended that no one or more of Noteholders of any Series shall have any right in any manner whatsoever hereunder or under the Indenture Supplement or under the Equipment Notes of such Series to (i) surrender, impair, waive, affect, disturb or prejudice any part of the Indenture Estate, or the Lien of the Indenture on the Indenture Estate, or the rights of Noteholders of such Series, (ii) obtain or seek to obtain priority over or preference with respect to any other such Noteholder of such Series or (iii) enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal, ratable and common benefit of all Noteholders of such Series subject to the provisions of this Indenture. ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Indenture Event of Default. If Loan Trustee has Actual Knowledge of an Indenture Event of Default or of a default arising from a failure by Lessee to pay when due any Rent, Loan Trustee shall promptly give notice thereof to Owner Trustee, Owner Participant, Lessee and each Noteholder. Subject to the terms of Sections 4.03, 4.04, 5.02 and 5.03, Loan Trustee shall take such action, or refrain from taking such action, with respect to such Indenture Event of Default (including with respect to the exercise of any rights or remedies hereunder) as Loan Trustee is instructed in writing by a Majority in Interest of Noteholders. Subject to the provisions of Section 5.03, if Loan Trustee does not receive instructions as above provided within 20 Business Days after giving notice of such Indenture Event of Default to Noteholders, Loan Trustee may, subject to instructions thereafter received pursuant to the preceding provisions of this Section 5.01, take such action, or refrain from taking such action with respect to such Indenture Event of Default as it reasonably determines to be advisable in the best interests of Noteholders, but shall be under no duty to take or refrain from taking any action. If Loan Trustee shall at any time declare the Lease to be in default pursuant to Section 15 thereof or shall elect to foreclose or otherwise enforce this Indenture, Loan Trustee shall forthwith notify Owner Participant, Owner Trustee, Lessee and Noteholders. It shall use the same degree of care and skill in connection therewith as a prudent person would use under the circumstances in the conduct of his or her own affairs. Loan Trustee may not sell the Airframe or any Engine without the consent of a Majority in Interest of Noteholders. For all purposes of this Indenture, in the absence of Actual Knowledge, Loan Trustee, Owner Trustee or Owner Participant, as the case may be, shall not be deemed to have knowledge of an Indenture Default or an Indenture Event of Default unless notified in writing by Lessee, Owner Participant, Owner Trustee or one or more Noteholders; provided, however, that Loan Trustee is deemed to have Actual Knowledge of (i) the failure of Lessee to pay any installment of Basic Rent when the same shall become due or (ii) the failure of Lessee to maintain insurance as required under Section 11 of the Lease if Loan Trustee receives written notice thereof from an insurer or insurance broker. Section 5.02 Action upon Instructions; Certain Rights and Limitations. (a) Subject to the terms of Section 2.19, Article IV and this Article V, upon the written instructions at any time of a Majority in Interest of Noteholders, Loan Trustee shall promptly (i) give such notice, direction, consent, waiver or approval or exercise such right, remedy or power hereunder as is specified in such instructions; (ii) give such notice or direction or exercise such right, remedy or power under the Lease, the Participation Agreement, the Purchase Agreement, or any other part of the Indenture Estate as shall be specified in such instructions; and (iii) after the occurrence and during the continuance of an Indenture Event of Default, approve as satisfactory to Loan Trustee all matters required by the terms of the Lease to be satisfactory to Owner Trustee, it being understood that without the written instructions of a Majority in Interest of Noteholders, Loan Trustee shall not approve any such matter as satisfactory to Loan Trustee; provided, that anything contained in this Indenture, the Lease or the other Operative Documents to the contrary notwithstanding: (1) Owner Trustee or Owner Participant may, without the consent of Loan Trustee, demand, collect, sue for or otherwise obtain all amounts included in Excluded Payments from Lessee, exercise any election or option or make any decision or determination or to give or receive any notice, consent, waiver or approval in respect of any Excluded Payment and seek legal or equitable remedies to require Lessee to maintain the insurance coverage referred to in Section 11 of the Lease; provided, that the rights referred to in this clause (1) shall not be deemed to include the exercise of any remedies provided for in Section 15 of the Lease other than the right to proceed by appropriate court action, either at law or in equity, to enforce payment by Lessee of such amounts included in Excluded Payments or performance by Lessee of such insurance covenant, or to recover damages for the breach thereof or for specific performance of any covenant of Lessee; (2) (A) Loan Trustee shall not, without the consent of Owner Trustee, execute or deliver amendments or modifications in respect of any provisions of the Lease, and (B) unless an Indenture Event of Default and a Loan Trustee Event shall have occurred and be continuing and except as provided in clause (4) below, Loan Trustee shall not, without the consent of Owner Trustee, which consent shall not be withheld if no right or interest of Owner Trustee or Owner Participant shall be diminished or impaired thereby, (i) enter into, execute or deliver waivers or consents in respect of any of the provisions of the Lease, or (ii) approve any accountants, engineers, appraisers or counsel as satisfactory to render services for or issue opinions to Owner Trustee pursuant to the Operative Documents; provided that, whether or not an Indenture Event of Default shall have occurred and be continuing, no amendment, modification, waiver or consent in respect of the Lease shall affect the amount or timing of, or the right to enforce payment of, any Excluded Payment; (3) whether or not an Indenture Default or Indenture Event of Default has occurred and is continuing, Owner Trustee and Owner Participant shall have the right, together with Loan Trustee, (i) to receive from Lessee all notices, certificates, reports, filings, opinions of counsel and other documents and all information which any thereof is permitted or required to give or furnish to Owner Trustee or Lessor pursuant to any Operative Document (including pursuant to Section 4.04 of the Participation Agreement), (ii) to exercise inspection rights pursuant to Section 12 of the Lease, (iii) to retain all rights with respect to insurance maintained for its own account which Section 11(f) of the Lease specifically confers on Lessor or Owner Participant, (iv) to exercise, to the extent necessary to enable it to exercise its rights under Section 4.03 hereof, the rights of Lessor under Section 21 of the Lease and (v) to give notices of default under Section 14 of the Lease; (4) whether or not an Indenture Default or Indenture Event of Default has occurred and is continuing, Owner Trustee shall have the right to the exclusion of Loan Trustee to adjust upward Rent, Stipulated Loss Values and Termination Values as provided in Section 3(d) of the Lease and to select counsel with respect to any opinion relating to tax matters to be delivered solely to Owner Participant; (5) so long as no Loan Trustee Event has occurred and is continuing, Owner Trustee shall have the right, to the exclusion of Loan Trustee, to adjust the Special Purchase Price, [the Initial Installment, the Remaining Installments,] as provided in Section 3(c) of the Lease or to adjust downward any installment or amount of Basic Rent, Stipulated Loss Value or Termination Value, as such installments and amounts are set forth in Exhibits B-1, C and D, respectively, to the Lease, to the extent of the portion of such installment or amount that would, under Section 3.01, 3.02 or 3.03, as the case may be, be distributable to Owner Trustee or Owner Participant; (6) whether or not an Indenture Default or Indenture Event of Default has occurred and is continuing, Owner Trustee may, without the consent of Loan Trustee, (i) solicit and make bids with respect to the Aircraft under Section 9 of the Lease in respect of a termination of the Lease by Lessee pursuant to Section 9 thereof, (ii) determine "fair market sales value" and "fair market rental value" under Section 19 of the Lease for all purposes except following an Event of Default pursuant to Section 15 of the Lease, and (iii) make an election pursuant to and in accordance with the provisions of Section 9(c) of the Lease; and (7) so long as no Indenture Event of Default shall have occurred and be continuing, except as provided in clauses (2) and (3) above, all rights of "Lessor" under the Lease shall be exercised by Owner Trustee to the exclusion of Loan Trustee including, without limitation, the right to (i) exercise all rights with respect to Lessee's use and operation, modification or maintenance of the Aircraft and any Engine which the Lease specifically confers on Lessor, and (ii) consent to and approve any assignment pursuant to Section 13 of the Lease; provided that the foregoing shall not limit (A) any rights separately granted to Loan Trustee under the Operative Documents or (B) the right of Loan Trustee to receive any funds to be delivered to "Lessor" under the Lease (except with respect to Excluded Payments) and under the Purchase Agreement. Notwithstanding anything to the contrary contained herein, Loan Trustee shall have the right, to the exclusion of Owner Trustee and Owner Participant, to (A) declare the Lease to be in default under Section 15 thereof and (B) subject only to the provisions of Sections 4.03, 4.04(a) and 2.19 hereof, exercise the remedies set forth in such Section 15 (other than in connection with Excluded Payments) at any time that a Lease Event of Default shall have occurred and be continuing. Loan Trustee will execute and Owner Trustee will file or cause to be filed such continuation statements with respect to financing statements relating to the security interest created hereunder in the Indenture Estate as specified by Lessee pursuant to Section 6.02(c) of the Participation Agreement or as may be specified from time to time in written instructions of a Majority in Interest of Noteholders (which instructions may, by their terms, be operative only at a future date and which shall be accompanied by the form of such continuation statement so to be filed). Loan Trustee will furnish to each Noteholder (and, during the continuation of a Loan Trustee Event, to Owner Trustee and Owner Participant), promptly upon receipt thereof, duplicates or copies of all reports, notices, requests, demands, certificates and other instruments furnished to Loan Trustee under the Lease or hereunder, including, without limitation, a copy of any Termination Notice (as defined in the Lease) and a copy of each report or notice received pursuant to Sections 9(a) and 11(e) of the Lease, respectively, to the extent that the same shall not have been furnished to such Noteholder pursuant hereto or to the Lease. (b) If any Lease Event of Default shall have occurred and be continuing and Owner Trustee shall not have cured fully such Lease Event of Default under and in accordance with Section 4.03 hereof, on request of a Majority in Interest of Noteholders, Loan Trustee shall declare the Lease to be in default pursuant to Section 15 thereof and exercise those remedies specified by such Noteholders. Loan Trustee agrees to provide to Noteholders, Owner Trustee, Owner Participant and Lessee concurrently with such declaration by Loan Trustee, notice of such declaration by Loan Trustee. Section 5.03 Indemnification. Loan Trustee shall not be required to take any action or refrain from taking any action under Sections 5.01 (other than the first sentence thereof) or 5.02 or Article IV unless it shall have received indemnification against any risks incurred in connection therewith in form and substance reasonably satisfactory to it, including, without limitation, adequate advances against costs that may be incurred by it in connection therewith. Loan Trustee shall not be required to take any action under Section 5.01 (other than the first sentence thereof) or 5.02 or Article IV, nor shall any other provision of any Operative Document be deemed to impose a duty on Loan Trustee to take any action, if Loan Trustee shall have been advised by outside counsel that such action is contrary to the terms hereof or of the Lease or is otherwise contrary to law. Section 5.04 No Duties Except as Specified in Indenture or Instructions. Loan Trustee shall not have any duty or obligation to manage, control, lease, use, sell, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Indenture Estate, or to otherwise take or refrain from taking any action under, or in connection with, this Indenture, except as expressly provided by the terms of this Indenture or the Participation Agreement or as expressly provided in written instructions received pursuant to the terms of Section 5.01 or 5.02; and no implied duties or obligations shall be read into this Indenture against Loan Trustee. Loan Trustee agrees that it will in its individual capacity and at its own cost and expense (but without any right of indemnity in respect of any such cost or expense under Section 7.01), promptly take such action as may be necessary duly to discharge all liens and encumbrances on any part of the Indenture Estate which result from claims against it in its individual capacity not related to the ownership of the Aircraft or the administration of the Indenture Estate or any other transaction pursuant to this Indenture or any document included in the Indenture Estate. Section 5.05 No Action Except under Lease, Indenture or Instructions. Loan Trustee will not manage, control, use, sell, lease, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Indenture Estate except (i) as required by the terms of the Lease or (ii) in accordance with the powers granted to, or the authority conferred upon, Owner Trustee and Loan Trustee pursuant to this Indenture and in accordance with the express terms hereof. Section 5.06 Replacement Airframes and Replacement Engines. At any time an Airframe or Engine is to be replaced under or pursuant to Section 10 of the Lease by a Replacement Airframe or Replacement Engine, Owner Trustee shall direct Loan Trustee to execute and deliver to Owner Trustee an appropriate instrument releasing such Airframe and/or Engine as appropriate from the Lien of this Indenture and Loan Trustee shall execute and deliver such instrument as aforesaid, but only upon compliance by Lessee with the applicable provisions of Section 10 of the Lease and upon receipt by or deposit with Loan Trustee of the following: (1) A written request from Owner Trustee, requesting such release specifically describing the Airframe and/or Engine(s) so to be released. (2) A certificate signed by a duly authorized officer of Lessee stating the following: A. With respect to the replacement of any Airframe: (i) a description of the Airframe which shall be identified by manufacturer, model, FAA registration number (or other applicable registration information) and manufacturer's serial number; (ii) a description of the Replacement Airframe to be received (including the manufacturer, model, FAA registration number (or other applicable registration information) and manufacturer's serial number) as consideration for the Airframe to be released; (iii) that the Replacement Airframe is of the same or an improved model as the Airframe requested to be released from this Indenture; (iv) the value and utility (without regard to hours or cycles) of the Replacement Airframe as of the date of such certificate (which in the judgment of Lessee shall be not less than the value and utility (without regard to hours or cycles) of the Airframe requested to be released (assuming no Event of Loss and that such Airframe was in the condition and repair required to be maintained under the Lease)); and (v) that no Lease Event of Default and no event which, with lapse of time or notice, or both, would become a Lease Event of Default, has occurred which has not been remedied or waived, and that Lessee will not be in default, by the making and granting of the request for release and the addition of a Replacement Airframe, in the performance of any of the terms and covenants of the Lease. B. with respect to the replacement of any Engine: (i) a description of the Engine which shall be identified by manufacturer's serial number; (ii) a description of the Replacement Engine (including the manufacturer's name and serial number) as consideration for the Engine to be released; (iii) that such Replacement Engine is substantially the same type as the Engine to be released (or an improved model); (iv) the value and utility (without regard to hours or cycles) of the Replacement Engine as of the date of such certificate (which value shall not be less than the value and utility (without regard to hours or cycles) of the Engine to be released (assuming no Event of Loss and that such Engine was in the condition and repair required to be maintained under the Lease)); (v) that each of the conditions specified in Section 10(b) of the Lease with respect to such Replacement Engine have been satisfied; and (vi) that, with respect to the replacement of an Engine pursuant to Section 9(c) of the Lease, no Lease Event of Default has occurred which has not been remedied or waived. (3) (a) The appropriate instruments (i) transferring to Owner Trustee title to the Replacement Airframe or Replacement Engine to be received as consideration for the Airframe or Engine to be released and (ii) assigning to Owner Trustee the benefit of all manufacturer's and vendor's warranties generally available with respect to such Replacement Airframe or Replacement Engine, and a Trust Agreement and Indenture Supplement subjecting such Replacement Airframe or Replacement Engine and any related warranty rights to the lien of this Indenture. (b) With respect to the replacement of any Engine, such Uniform Commercial Code financing statements covering the Lien created by this Indenture as deemed necessary or desirable by counsel for Loan Trustee to protect the Lien under this Indenture in the Replacement Engine. (4) A certificate from an independent aircraft engineer or appraiser selected by Lessee confirming the accuracy of the information set forth in clauses (2)A(iv) and (2)B(iv) of this Section 5.06. (5) The opinion of counsel to Lessee (which may be internal counsel of Lessee) addressed to Lessor and Loan Trustee stating that upon such replacement, title to such Replacement Airframe or Replacement Engine has been vested in Lessor and such Replacement Airframe or Replacement Engine has been validly subjected to the Lien of this Indenture and covered by the Lease, the instruments subjecting such Replacement Airframe or Replacement Engine to the Lease and to the Lien of this Indenture, as the case may be, have been duly filed for recordation pursuant to the Federal Aviation Act or any other law then applicable to the registration of the Aircraft, and no further action, filing or recording of any document is necessary or advisable in order to establish and perfect the right, title, estate and interest of Owner Trustee to and the Lien of this Indenture on such Replacement Aircraft or Replacement Engine. Section 5.07 Indenture Supplements for Replacements. If a Replacement Airframe or Replacement Engine is being substituted as contemplated by Section 10 of the Lease, Owner Trustee and Loan Trustee agree for the benefit of Noteholders and Lessee, subject to fulfillment of the conditions precedent and compliance by Lessee with its obligations set forth in Section 10 of the Lease and the requirements of Section 5.06 hereof with respect to such Replacement Airframe or Replacement Engine, to execute and deliver a Lease Supplement and an Indenture Supplement, as applicable, as contemplated by Section 10 of the Lease. Section 5.08 Effect of Replacement. In the event of the substitution of an Airframe or of a Replacement Engine pursuant to Section 10 of the Lease, (a) all provisions of this Indenture relating to the Airframe or Engine or Engines being replaced shall be applicable to such Replacement Airframe or Replacement Engine or Engines with the same force and effect as if such Replacement Airframe or Replacement Engine or Engines were the same airframe or engine or engines, as the case may be, as the Airframe or Engine or Engines being replaced but for the Event of Loss with respect to the Airframe or Engine or Engines being replaced, and (b) the provisions of this Indenture shall no longer be applicable to the Airframe or Engine or Engines being replaced, which shall be released from the Lien of this Indenture. Section 5.09 Investment of Amounts Held by Loan Trustee. Any monies held by Loan Trustee as assignee of Owner Trustee's right to hold monies for security pursuant to Section 22(a) of the Lease shall be held in accordance with the terms of such Section and Loan Trustee agrees, for the benefit of Lessee, to perform the duties of Owner Trustee under such Section. Any monies held by Loan Trustee pursuant to the proviso to the first sentence of Section 3.01, pursuant to Section 3.02 or pursuant to any other provision of any other Operative Document providing for amounts to be so held by Loan Trustee, until paid out by Loan Trustee as herein provided, (i) subject to clause (ii) below, may be carried by Loan Trustee on deposit with itself or on deposit to its account with any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of a least $100,000,000, and Loan Trustee shall not have any liability for interest upon any such monies except as otherwise agreed in writing with Owner Trustee and Lessee, or (ii) at any time and from time to time, so long as no Indenture Event of Default shall have occurred and be continuing, at the request of Owner Trustee in the case of amounts held pursuant to the proviso to the first sentence of Section 3.01, and otherwise at the request of Lessee, shall be invested and reinvested in Permitted Investments as specified in such request (if such investments are reasonably available for purchase) and sold, in any case at such prices, including accrued interest or its equivalent, as are set forth in such request, and such Permitted Investments shall be held by Loan Trustee in trust as part of the Indenture Estate until so sold. Unless otherwise expressly provided in this Indenture, any net income, profit, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment shall be held as part of the Indenture Estate and shall be applied by Loan Trustee at the same time, on the same conditions and in the same manner as the amounts in respect of which such income, profit, interest, dividend or gain was realized are required to be distributed in accordance with the provisions hereof pursuant to which such amounts were required to be held. Loan Trustee shall not be responsible for any losses on any investments or sales of Permitted Investments made pursuant to the procedure specified in this Section 5.09 other than by reason of its willful misconduct or negligence. ARTICLE VI OWNER TRUSTEE AND LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties. State Street accepts the trusts and duties hereby created and applicable to it and agrees to perform such duties, but only upon the terms of this Indenture and agrees to receive, handle and disburse all monies received by it as Loan Trustee constituting part of the Indenture Estate in accordance with the terms hereof. Owner Trustee in its individual capacity and State Street shall have no liability hereunder except (a) for their own willful misconduct or negligence, (b) in the case of State Street, as provided in the fourth sentence of Section 2.03 and the last sentence of Section 5.04 and of 5.09, (c) in the case of State Street, for liabilities that may result from the inaccuracy of any representation or warranty of State Street in the Participation Agreement or expressly made hereunder and in the case of Owner Trustee, for liabilities that may result from the inaccuracy of any representation or warranty of Owner Trustee expressly made in its individual capacity in the Participation Agreement or in Section 4.01(b) or 6.03 (or in any certificate furnished to Loan Trustee or any Noteholder in connection with the transactions contemplated by the Operative Documents) and (d) as otherwise expressly provided in the Operative Documents. Neither Owner Trustee nor Loan Trustee shall be liable for any action or inaction of the other or of Owner Participant. Section 6.02 Absence of Certain Duties. In the case of Loan Trustee, except in accordance with written instructions furnished pursuant to Sections 5.01, 5.02 or 6.06, and except as provided in, and without limiting the generality of, Sections 5.02, 5.03 and 5.04, and, in the case of Owner Trustee, except as provided in Section 4.01(b), Owner Trustee and Loan Trustee shall have no duty (a) to see to any registration of the Aircraft or any recording or filing of the Lease or this Indenture or any other document, or to see to the maintenance of any such registration, recording or filing, (b) to see to any insurance on the Aircraft or to effect or maintain any such insurance, whether or not Lessee is in default with respect thereto, (c) to confirm, verify or inquire into the failure to receive any financial statements of Lessee or (d) to inspect the Aircraft at any time or ascertain or inquire as to the performance or observance of any of Lessee's covenants under the Lease with respect to the Aircraft. Owner Participant shall not have any duty or responsibility hereunder, including, without limitation, any of the duties mentioned in clauses (a) through (d) above; provided, that nothing contained in this sentence shall limit any of the obligations of Owner Participant under the Participation Agreement or relieve Owner Participant from any restriction under Section 4.03 hereof. Section 6.03 No Representations or Warranties as to Aircraft or the Documents. NEITHER LOAN TRUSTEE IN ITS INDIVIDUAL OR TRUST CAPACITY NOR OWNER TRUSTEE IN ITS INDIVIDUAL CAPACITY OR AS OWNER TRUSTEE UNDER THE TRUST AGREEMENT, NOR OWNER PARTICIPANT MAKES OR SHALL BE DEEMED TO HAVE MADE AND EACH HEREBY EXPRESSLY DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, VALUE, COMPLIANCE WITH SPECIFICATIONS, CONDITION, DESIGN, QUALITY, DURABILITY, OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR A PARTICULAR PURPOSE OF THE AIRCRAFT OR ANY ENGINE, AS TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, except Owner Trustee in its individual capacity warrants that (i) Owner Trustee has received on the Delivery Date whatever title was conveyed to it by Lessee, and (ii) the Aircraft is free and clear of Lessor Liens (including for this purpose Liens which would be Lessor Liens but for the proviso in the definition of Lessor Liens) attributable to Owner Trustee in its individual capacity. Neither Owner Trustee, in its individual capacity or as Owner Trustee under the Trust Agreement, nor Loan Trustee, in its individual or trust capacities, makes or shall be deemed to have made any representation or warranty as to the validity, legality or enforceability of this Indenture, the Trust Agreement, the Participation Agreement, the Equipment Notes, the Lease, the Purchase Agreement, the Purchase Agreement Assignment or the Manufacturer's Consent, or as to the correctness of any statement contained in any thereof, except for the representations and warranties of Owner Trustee made in its individual capacity and the representations and warranties of Loan Trustee, in each case expressly made in this Indenture or in the Participation Agreement. Noteholders and Owner Participant make no representation or warranty hereunder whatsoever. Section 6.04 No Segregation of Monies; No Interest. Subject to Section 5.09 hereof, all moneys received by Loan Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by Section 10(f) or Section 11(g) of the Lease or by mandatory provisions of law, and neither Loan Trustee nor any agent of Loan Trustee shall be under any liability for interest on any moneys received by it hereunder; provided, however, that any payments received, or applied hereunder, by Loan Trustee shall be accounted for by Loan Trustee so that any portion thereof paid or applied pursuant hereto shall be identifiable as to the source thereof. Section 6.05 Reliance; Agents; Advice of Counsel. Neither Owner Trustee nor Loan Trustee shall incur any liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. Owner Trustee and Loan Trustee may accept a copy of a resolution of the Board of Directors (or, in the case of Owner Participant which originally executed the Participation Agreement, evidence of approval thereof) of any party to the Participation Agreement, certified by the Secretary or an Assistant Secretary of such party as duly adopted and in full force and effect, as conclusive evidence that such resolution has been duly adopted and that the same is in full force and effect. As to any fact or matter the manner of ascertainment of which is not specifically described herein, Owner Trustee and Loan Trustee may for all purposes hereof rely on a certificate, signed by a duly authorized officer of Lessee, as to such fact or matter, and such certificate shall constitute full protection to Owner Trustee and Loan Trustee for any action taken or omitted to be taken by them in good faith in reliance thereon. Loan Trustee shall assume, and shall be fully protected in assuming that Owner Trustee is authorized by the Trust Agreement to enter into this Indenture and to take all action to be taken by it pursuant to the provisions hereof, and shall not inquire into the authorization of Owner Trustee with respect thereto. In the administration of the trusts hereunder, each of Owner Trustee and Loan Trustee may, with the consent of Lessee (such consent not to be unreasonably withheld), (a) execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents (including paying agents or registrars) or attorneys, and (b) at the expense of the Indenture Estate, consult with counsel, accountants and other skilled Persons to be selected and retained by it. Owner Trustee and Loan Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled Persons acting within such counsel's, accountants' or Person's area of competence (so long as Owner Trustee and Loan Trustee shall have exercised reasonable care and judgment in selecting such Persons). Section 6.06 Capacity in Which Acting. Owner Trustee acts hereunder solely as trustee as herein and in the Trust Agreement provided, and not in its individual capacity, except as otherwise expressly provided herein, in the Trust Agreement and in the Participation Agreement. Section 6.07 Compensation. Loan Trustee shall be entitled to reasonable compensation, including expenses and disbursements (including the reasonable fees and expenses of counsel), for all services rendered hereunder and shall, on and subsequent to an Indenture Event of Default hereunder, have a priority claim on the Indenture Estate for the payment of such compensation, to the extent that such compensation shall not be paid by Lessee, and shall have the right, on and subsequent to an Indenture Event of Default hereunder, to use or apply any monies held by it hereunder in the Indenture Estate toward such payments. Loan Trustee agrees that it shall have no right against Noteholders, Owner Trustee or Owner Participant for any fee as compensation for its services as trustee under this Indenture. Section 6.08 Instructions from Noteholders. In the administration of the trusts created hereunder, Loan Trustee shall have the right to seek instructions from a Majority in Interest of Noteholders should any provision of this Indenture appear to conflict with any other provision herein or any other Operative Document or Pass Through Document or should Loan Trustee's duties or obligations hereunder be unclear, and Loan Trustee shall incur no liability in refraining from acting until it receives such instructions. Loan Trustee shall be fully protected for acting in accordance with any instructions received under this Section 6.08. ARTICLE VII INDEMNIFICATION OF LOAN TRUSTEE BY OWNER TRUSTEE Section 7.01 Scope of Indemnification. Owner Trustee, not in its individual capacity, but solely as Owner Trustee, hereby agrees, except as otherwise provided in Section 2.18 hereof, to assume liability for, and does hereby indemnify, protect, save and keep harmless Loan Trustee (in its individual and trust capacities), and its successors, assigns, agents and servants, from and against any and all liabilities, obligations, losses, damages, penalties, taxes (excluding any taxes payable by Loan Trustee on or measured by any compensation received by Loan Trustee for its services under this Indenture), claims, actions, suits, costs, expenses or disbursements (including reasonable legal fees and expenses) of any kind and nature whatsoever, which may be imposed on, incurred by or asserted against Loan Trustee (whether or not also indemnified against by any other Person under any other document) in any way relating to or arising out of this Indenture or any other Operative Document to which it is a party or the enforcement of any of the terms of any thereof, or in any way relating to or arising out of the manufacture, purchase, acceptance, non-acceptance, rejection, ownership, delivery, lease, possession, use, operation, condition, sale, return or other disposition of the Aircraft or any Engine (including, without limitation, latent or other defects, whether or not discoverable, and any claim for patent, trademark or copyright infringement), or in any way relating to or arising out of the administration of the Indenture Estate or the action or inaction of Loan Trustee hereunder, to the extent not reimbursed by Lessee. Without limiting the foregoing, Loan Trustee agrees that, prior to seeking indemnification from the Indenture Estate, it will demand, and take such action as it may in its discretion determine to be reasonable to pursue, indemnification available to Loan Trustee under the Lease or the Participation Agreement. Notwithstanding the foregoing, Loan Trustee shall not be entitled to any indemnification for any Taxes or Expenses to the extent relating to or arising from the willful misconduct or negligence of Loan Trustee in the performance of its duties hereunder or resulting from the inaccuracy of any representation or warranty of Loan Trustee (in its individual capacity) referred to in Section 6.03 hereof, or as provided in Section 6.01 hereof or in the last sentence of Section 5.04 hereof, or as otherwise excluded by the terms of Sections 4.02 and 4.03 of the Participation Agreement from Lessee's indemnities under such Sections. In addition, if necessary, Loan Trustee shall be entitled to indemnification from the Indenture Estate for any liability, obligation, loss, damage, penalty, claim, action, suit, cost, expense or disbursement indemnified against pursuant to this Section 7.01 to the extent not reimbursed by Lessee or others, but without releasing any of them from their respective agreements of reimbursement; and to secure the same Loan Trustee shall have a prior Lien on the Indenture Estate. Owner Trustee shall be subrogated to Loan Trustee's rights, if any, to any indemnity payment from Lessee for the amounts paid by Owner Trustee under this Section 7.01. ARTICLE VIII SUCCESSOR AND SEPARATE TRUSTEES Section 8.01 Notice of Successor Owner Trustee. In the case of any appointment of a successor to Owner Trustee pursuant to the Trust Agreement including upon any merger, conversion, consolidation or sale of substantially all of the corporate trust business of Owner Trustee pursuant to the Trust Agreement, the successor Owner Trustee shall give prompt written notice thereof to Loan Trustee, Lessee and Noteholders. Section 8.02 Resignation and Removal of Loan Trustee; Appointment of Successor. (a) The resignation or removal of Loan Trustee and the appointment of a successor Loan Trustee shall become effective only upon the successor Loan Trustee's acceptance of appointment as provided in this Section 8.02. Loan Trustee or any successor thereto must resign if at any time it ceases to be eligible in accordance with the provisions of Section 8.02(c) and may resign at any time without cause by giving at least 60 days' prior written notice to Lessee, Owner Trustee, Owner Participant and each Noteholder. In addition, a Majority in Interest of Noteholders (but only with the consent of Lessee so long as no Lease Event of Default shall have occurred and be continuing) may at any time remove Loan Trustee without cause by an instrument in writing delivered to Loan Trustee, Owner Trustee, Owner Participant, Lessee and each Noteholder. In the case of the resignation or removal of Loan Trustee, a Majority in Interest of Noteholders may appoint a successor Loan Trustee by an instrument signed by such holders, which successor, so long as no Lease Event of Default shall have occurred and be continuing, shall be subject to Lessee's reasonable approval. If a successor Loan Trustee has not been appointed within 60 days after such notice of resignation or removal, Loan Trustee, Lessee, Owner Trustee, Owner Participant or any Noteholder may apply to any court of competent jurisdiction to appoint a successor Loan Trustee to act until such time, if any, as a successor is appointed as above provided. The successor Loan Trustee so appointed by such court shall immediately and without further act be superseded by any successor Loan Trustee appointed as above provided. (b) Any successor Loan Trustee, however appointed, shall execute and deliver to the predecessor Loan Trustee, Owner Trustee and Lessee an instrument accepting such appointment and assuming the obligations of Loan Trustee arising from and after the time of such appointment, and thereupon such successor Loan Trustee, without further act, shall become vested with all the estates, properties, rights, powers and duties of the predecessor Loan Trustee in the trust hereunder applicable to it with like effect as if originally named Loan Trustee herein; but nevertheless upon the written request of such successor Loan Trustee, such predecessor Loan Trustee shall execute and deliver an instrument transferring to such successor Loan Trustee all the estates, properties, rights and powers of such predecessor Loan Trustee, and such predecessor Loan Trustee shall duly assign, transfer, deliver and pay over to such successor Loan Trustee all monies or other property and all other books and records, or true, correct and complete copies thereof, then held by such predecessor Loan Trustee. (c) This Indenture shall at all times have a Loan Trustee, however appointed, that is a Citizen of the United States (without the use of a voting trust) and a bank or trust company having a combined capital and surplus of at least $100,000,000 (or a combined capital and surplus in excess of $5,000,000 and the obligations of which, whether now in existence or hereafter incurred, are fully and unconditionally guaranteed by a corporation organized and doing business under the laws of the United States or any state or territory thereof or the District of Columbia and having a combined capital and surplus of at least $100,000,000) or a corporation with a net worth of at least $100,000,000, if there be such an institution willing, able and legally qualified to perform the duties of Loan Trustee upon reasonable or customary terms. If such bank, trust company or corporation publishes reports of conditions at least annually, pursuant to law or to the requirements of federal, state, territorial or District of Columbia supervising or examining authority, then for the purposes of this Section 8.02(c) the combined capital and surplus of such bank, trust company or corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of conditions so published. In case at any time Loan Trustee ceases to be eligible in accordance with the provisions of this Section 8.02(c), Loan Trustee shall resign immediately in the manner and with the effect specified in Section 8.02(a). (d) Any corporation into which Loan Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which Loan Trustee is a party, or any corporation to which substantially all the corporate trust business of Loan Trustee may be transferred, shall, subject to the terms of Section 8.02(c), be a successor Loan Trustee under this Indenture without further act. Section 8.03 Appointment of Additional and Separate Trustees. (a) Whenever (i) Loan Trustee deems it necessary or desirable in order to conform to any law of any jurisdiction in which all or any part of the Indenture Estate is situated or to make any claim or bring any suit with respect to or in connection with the Indenture Estate, any Operative Document or any of the transactions contemplated by the Operative Documents, (ii) Loan Trustee shall be advised by counsel satisfactory to it that it is necessary or prudent in the interests of Noteholders (and Loan Trustee shall so advise Owner Trustee and Lessee) or (iii) Loan Trustee has been requested to do so by a Majority in Interest of Noteholders, then in any such case, Loan Trustee and, upon the written request of Loan Trustee, Owner Trustee, shall execute and deliver an indenture supplemental hereto and such other instruments as from time to time are necessary or advisable either (1) to constitute one or more banks or trust companies or corporations meeting the requirements of Section 8.02(c) and approved by Loan Trustee, either to act jointly with Loan Trustee as additional trustee or trustees of all or any part of the Indenture Estate or to act as separate trustee or trustees of all or any part of the Indenture Estate, in each case with such rights, powers, duties and obligations consistent with this Indenture as is provided in such supplemental indenture or other instruments as Loan Trustee or a Majority in Interest of Noteholders deems necessary or advisable, or (2) to clarify, add to or subtract from the rights, powers, duties and obligations theretofore granted any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.03. If no Indenture Event of Default has occurred and is continuing, no additional or supplemental trustee shall be appointed without Owner Trustee's consent. If an Indenture Event of Default shall have occurred and be continuing, Loan Trustee may act under the foregoing provisions of this Section 8.03(a) without the concurrence of Owner Trustee, and Owner Trustee hereby irrevocably appoints (which appointment is coupled with an interest) Loan Trustee as its agent and attorney-in-fact to act for it under the foregoing provisions of this Section 8.03(a). Loan Trustee may, in such capacity, execute, deliver and perform any such supplemental indenture, or any such instrument, as may be required for the appointment of any such additional or separate trustee or for the clarification of, addition to or subtraction from the rights, powers, duties or obligations theretofore granted to any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.03. In case any additional or separate trustee appointed under this Section 8.03(a) becomes incapable of acting, resigns or is removed, all the assets, property, rights, powers, trusts, duties and obligations of such additional or separate trustee shall revert to Loan Trustee until a successor additional or separate trustee is appointed as provided in this Section 8.03(a). (b) No additional or separate trustee shall be entitled to exercise any of the rights, powers, duties and obligations conferred upon Loan Trustee in respect of the custody, investment and payment of monies and all monies received by any such additional or separate trustee from or constituting part of the Indenture Estate or otherwise payable under any Operative Documents to Loan Trustee shall be promptly paid over by it to Loan Trustee. All other rights, powers, duties and obligations conferred or imposed upon any additional or separate trustee shall be exercised or performed by Loan Trustee and such additional or separate trustee jointly except to the extent that applicable law of any jurisdiction in which any particular act is to be performed renders Loan Trustee incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations (including the holding of title to all or part of the Indenture Estate in any such jurisdiction) shall be exercised and performed by such additional or separate trustee. No additional or separate trustee shall take any discretionary action except on the instructions of Loan Trustee or a Majority in Interest of Noteholders. No trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder, except that Loan Trustee shall be liable for the consequences of its lack of reasonable care in selecting, and Loan Trustee's own actions in acting with, any additional or separate trustee. Each additional or separate trustee appointed pursuant to this Section 8.03 shall be subject to, and shall have the benefit of Articles IV, V, VI, VIII and X hereof insofar as they apply to Loan Trustee. The powers of any additional or separate trustee appointed pursuant to this Section 8.03 shall not in any case exceed those of Loan Trustee. (c) If at any time Loan Trustee deems it no longer necessary or desirable or in the event that Loan Trustee has been requested to do so in writing by a Majority in Interest of Noteholders, Loan Trustee and, upon the written request of Loan Trustee, Owner Trustee, shall execute and deliver an indenture supplemental hereto and all other instruments and agreements necessary or proper to remove any additional or separate trustee. Loan Trustee may act on behalf of Owner Trustee under this Section 8.03(c) when and to the extent it could so act under Section 8.03(a) hereof. In any case, Owner Trustee may remove an additional or separate trustee in the manner set forth in Section 8.02. ARTICLE IX SUPPLEMENTS, AMENDMENTS AND WAIVERS Section 9.01 Instructions of Majority; Limitations. (a) Except as provided in Section 5.02, and except with respect to Excluded Payments, Owner Trustee agrees it shall not enter into any amendment of or supplement to the Lease, the Purchase Agreement, the Purchase Agreement Assignment or the Manufacturer's Consent, or execute and deliver any written waiver or modification of, or consent under, the terms of the Lease, the Purchase Agreement, the Purchase Agreement Assignment or the Manufacturer's Consent, unless such supplement, amendment, waiver, modification or consent is consented to in writing by Loan Trustee and a Majority in Interest of Noteholders. Anything to the contrary contained herein notwithstanding, without the necessity of the consent of any of Noteholders or Loan Trustee, (i) any Excluded Payments payable to Owner Participant may be modified, amended, changed or waived in such manner as shall be agreed to by Owner Participant and Lessee and (ii) Owner Trustee and Lessee may enter into amendments of or additions to the Lease to modify Section 5 (except to the extent that such amendment would affect the rights or exercise of remedies under Section 15 of the Lease), Section 9 or Section 19 of the Lease so long as such amendments, modifications and changes do not and would not affect the time of, or reduce the amount of, Rent payments until after the payment in full of all Secured Obligations or otherwise adversely affect Noteholders. (b) Without limiting the provisions of Section 9.01(a) and subject to Section 5.02(a)(2), Loan Trustee agrees with Noteholders that it shall not enter into any amendment, waiver or modification of, supplement or consent to this Indenture, the Lease, the Purchase Agreement, the Purchase Agreement Assignment, the Manufacturer's Consent, or the Participation Agreement, or any other agreement included in the Indenture Estate, unless such supplement, amendment, waiver, modification or consent is consented to in writing by a Majority in Interest of Noteholders, or does not adversely affect Noteholders, but upon the written request of a Majority in Interest of Noteholders, Loan Trustee shall from time to time enter into any such supplement or amendment, or execute and deliver any such waiver, modification or consent, as may be specified in such request and as may be (in the case of any such amendment, supplement or modification), to the extent such agreement is required, agreed to by Owner Trustee and Lessee or, as may be appropriate, Manufacturer; provided, however, that, without the consent of each holder of an affected Equipment Note then outstanding, no such amendment of or supplement to this Indenture, the Lease, the Purchase Agreement, the Purchase Agreement Assignment, the Manufacturer's Consent or the Participation Agreement or waiver or modification of the terms of, or consent under, any thereof, shall (i) modify any of the provisions of this Section 9.01, or of Sections 2.02, 2.10, 2.11, 2.13, 4.02, 4.04(c), 4.04(d), 5.02 or 5.06 hereof, Section 14 (except to add an Event of Default) of the Lease, the definitions of "Event of Default", "Default", "Lease Event of Default", "Lease Default", "Indenture Event of Default", "Majority in Interest of Noteholders", "Make-Whole Amount" or "Noteholder", or the percentage of Certificate Holders required to take or approve any action hereunder, (ii) reduce the amount, or change the time of payment or method of calculation of any amount, of principal amount, Make-Whole Amount, if any, or interest with respect to any Equipment Note, or alter or modify the provisions of Article III hereof with respect to the order of priorities in which distribution thereunder shall be made as among Noteholders, Owner Trustee and Lessee, (iii) reduce, modify or amend any indemnities in favor of Noteholders, (iv) consent to any change in the Indenture or the Lease which would permit redemption of Equipment Notes earlier than permitted under Section 2.10 or 2.11 or the purchase of the Equipment Notes other than as permitted by Section 2.19, (v) modify any of the provisions of Section 3(c)(iv) of the Lease, or modify, amend or supplement the Lease or consent to any assignment of the Lease, in either case releasing Lessee from its obligations in respect of the payment of Basic Rent, Stipulated Loss Value or Termination Value for the Aircraft or altering the absolute and unconditional character of the obligations of Lessee to pay Rent as set forth in Sections 3 and 18 of the Lease or (vi) permit the creation of any Lien on the Indenture Estate or any part thereof prior to or pari passu with the Lien thereon under this Indenture, except such as are permitted by this Indenture and other than Permitted Liens, or deprive any Noteholder of the benefit of the Lien of this Indenture on the Indenture Estate, except as provided in connection with the exercise of remedies under Article IV hereof. So long as no Lease Event of Default has occurred and is continuing, without the consent of Lessee no amendment or supplement to this Indenture or waiver or modification of the terms hereof shall adversely affect Lessee. (c) At any time after the date hereof, Owner Trustee and Loan Trustee may enter into one or more agreements supplemental hereto without the consent of any Noteholder for any of the following purposes: (i) to cure any defect, ambiguity or inconsistency or correct any mistake herein or in the Equipment Notes, or to make any change not inconsistent with the provisions hereof (provided that such change does not adversely affect the interests of any Noteholder or Liquidity Provider); (ii) to evidence the succession of another party as Owner Trustee in accordance with the terms of the Trust Agreement or to evidence the succession of a new trustee hereunder pursuant hereto, the removal of the trustee pursuant hereto or the appointment of any co-trustee or co-trustees or any separate or additional trustee or trustees pursuant hereto; (iii) to convey, transfer, assign, mortgage or pledge any property to or with Loan Trustee or to make any other provisions with respect to matters or questions arising hereunder so long as such action shall not adversely affect the interests of Noteholders in their capacity solely as Noteholder; (iv) to amplify the description of any property at any time subject to the Lien of this Indenture or better to assure, convey and confirm unto Loan Trustee any property subject or required to be subject to the Lien of this Indenture, the Airframe or Engines or any Replacement Airframe or Replacement Engine; (v) to add to the covenants of Owner Trustee for the benefit of Noteholders, or to surrender any rights or power herein conferred upon Owner Trustee, Owner Participant or Lessee; and (vi) to add to the rights of Noteholders. Section 9.02 Trustees Protected. If, in the reasonable opinion of the institution acting as Owner Trustee under the Trust Agreement or the institution acting as Loan Trustee, any document required to be executed by it pursuant to the terms of Section 9.01 adversely affects any right, duty, immunity or indemnity with respect to such institution under this Indenture or the Lease, such institution may in its discretion decline to execute such document. Section 9.03 Documents Mailed to Noteholders. Promptly after the execution by Owner Trustee and Loan Trustee of any document pursuant to the provisions of Section 9.01, Loan Trustee shall transmit by first-class mail a notice, setting forth in general terms the substance of such document, to all Noteholders, as the names and addresses of such Noteholders appear on the Equipment Note Register. Any failure of Loan Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such document. Section 9.04 No Request Necessary for Lease Supplement and Indenture Supplement. No written request or consent of Loan Trustee, Noteholders or Owner Participant pursuant to Section 9.01 shall be required to enable Owner Trustee to enter into any Lease Supplement specifically required by the terms of the Lease or to execute and deliver an Indenture Supplement specifically required by the terms hereof. Section 9.05 Notation on or Exchange of Equipment Notes. Loan Trustee may place an appropriate notation about an amendment or waiver on any Equipment Note thereafter executed. Loan Trustee in exchange for such Equipment Notes may execute new Equipment Notes that reflect the amendment or waiver. ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture. Upon (or at any time after) payment in full of the principal amount, Make-Whole Amount, if any, and interest on and all other amounts due under all Equipment Notes and provided that there shall then be no other Secured Obligations due to Noteholders, Indenture Indemnitees and Loan Trustee hereunder or under the Participation Agreement, Owner Trustee and Loan Trustee shall be deemed to have been released and discharged from their respective obligations hereunder and under the Equipment Notes and the security interest, mortgage lien and all other estate, right, title and interest granted by this Indenture shall cease and become null and void and all of the property, rights, interests and privileges granted as security for the Equipment Notes shall revert to and revest in Owner Trustee without any other act or formality whatsoever, and Loan Trustee shall, upon the written request of Owner Trustee, execute and deliver to, or as directed in writing by, Owner Trustee an appropriate instrument (in due form for recording) releasing the Aircraft and the balance of the Indenture Estate from the Lien of this Indenture together with such other instruments and documents as Owner Trustee reasonably requests to give effect to the release and termination and shall give written notice thereof to Lessee, and, in such event, this Indenture and the trusts created hereby shall terminate and this Indenture shall be of no further force or effect; provided, however, that this Indenture and the trusts created hereby shall earlier terminate and this Indenture shall be of no further force or effect upon any sale or other final disposition by Loan Trustee of all property constituting part of the Indenture Estate and the final distribution by Loan Trustee of all monies or other property or proceeds constituting part of the Indenture Estate in accordance with the terms hereof. Except as otherwise provided above, this Indenture and the trusts created hereby shall continue in full force and effect in accordance with the terms hereof. Section 10.02 No Legal Title to Indenture Estate in Noteholders. No Noteholder shall have legal title to any part of the Indenture Estate. No transfer, by operation of law or otherwise, of any Equipment Note or other right, title and interest of any Noteholder in and to the Indenture Estate or hereunder shall operate to terminate this Indenture or entitle such Noteholder or any successor or transferee of such holder to an accounting or to the transfer to it of any legal title to any part of the Indenture Estate. Section 10.03 Sale of Aircraft by Loan Trustee is Binding. Any sale or other conveyance of the Indenture Estate (or any interest therein) by Loan Trustee made pursuant to the terms of this Indenture shall bind Noteholders, Owner Participant and Owner Trustee and shall be effective to transfer or convey all right, title and interest of Loan Trustee, Owner Participant, Owner Trustee and such Noteholders in and to such Indenture Estate (or interest therein). No purchaser or other grantee shall be required to inquire as to the authorization, necessity, expediency or regularity of such sale or conveyance or as to the application of any sale or other proceeds with respect thereto by Noteholders. Section 10.04 Indenture for Benefit of Owner Trustee, Owner Participant, Lessee, Loan Trustee and Noteholders. Nothing in this Indenture, whether express or implied, shall be construed to give any Person other than Owner Trustee, Owner Participant, Lessee, Loan Trustee, Noteholders or the other Indenture Indemnitees any legal or equitable right, remedy or claim under or in respect of this Indenture. Section 10.05 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Indenture shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as specified in Section 16.01 of the Participation Agreement, or if to any Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 hereof. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 10.05. Section 10.06 Severability. Any provision of this Indenture that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 10.07 No Oral Modification or Continuing Waivers. No terms or provisions of this Indenture or of the Equipment Notes may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by Owner Trustee and Loan Trustee, in compliance with Article IX. Any waiver of the terms hereof or of any Equipment Note shall be effective only in the specific instance and for the specific purpose given. Section 10.08 Successors and Assigns. All covenants and agreements contained herein shall bind and inure to the benefit of, and be enforceable by, each of the parties hereto and the successors and permitted assigns of each, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by any Noteholder shall bind the successors and permitted assigns of such Noteholder. This Indenture and the Indenture Estate shall not be affected by any amendment or supplement to the Trust Agreement or by any other action taken under or in respect of the Trust Agreement, except that each reference in this Indenture to the Trust Agreement shall mean the Trust Agreement, as amended and supplemented from time to time to the extent permitted hereby, thereby and by the Participation Agreement. Each Noteholder by its acceptance of an Equipment Note agrees to be bound by this Indenture and all provisions of the Participation Agreement applicable to a Noteholder. Section 10.09 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 10.10 Normal Commercial Relations. Anything contained in this Indenture to the contrary notwithstanding, Owner Trustee, Loan Trustee, Owner Participant, any Noteholder or any other party to any of the Operative Documents or the Pass Through Documents or any of their affiliates may conduct any banking or other financial transactions, and have banking or other commercial relationships, with Lessee, fully to the same extent as if this Indenture were not in effect, including without limitation the making of loans or other extensions of credit to Lessee for any purpose whatsoever, whether related to any of the transactions contemplated hereby or otherwise. Section 10.11 Voting by Noteholders. All votes of Noteholders shall be governed by a vote of a Majority in Interest of Noteholders, except as otherwise provided herein. Section 10.12 Section 1110. It is the intention of the parties that Owner Trustee, as lessor under the Lease (and Loan Trustee as assignee of Owner Trustee hereunder), shall be entitled to the benefits of Section 1110 with respect to the right to take possession of the Aircraft, Airframe, Engines and Parts as provided in the Lease and to enforce any of its other rights and remedies in the event of a case under Chapter 11 of the Bankruptcy Code in which Lessee is a debtor, and in any instance where more than one construction is possible of the terms and conditions hereof or any other pertinent Operative Document, each such party agrees that a construction which would preserve such benefits shall control over any construction which would not preserve such benefits. Section 10.13 Counterparts. This Indenture may be executed in any number of counterparts (and each of the parties hereto shall not be required to execute the same counterpart). Each counterpart of this Indenture including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Indenture, but all of such counterparts together shall constitute one instrument. Section 10.14 Governing Law. THIS INDENTURE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS INDENTURE, ANY INDENTURE SUPPLEMENT AND THE EQUIPMENT NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 10.15 No Action Contrary to Lessee's Rights Under the Lease. Notwithstanding any provision of this Indenture or the Trust Agreement to the contrary, neither Loan Trustee nor Owner Trustee will take any action contrary to Lessee's rights under the Lease, including the right to possession and use of, and the quiet enjoyment of, the Aircraft, except in accordance with the provisions of the Lease. Section 10.16 Submission to Jurisdiction. Each of the parties hereto, and by acceptance of Equipment Notes, each Noteholder, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Agreements hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Indenture, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Indenture or the Equipment Notes or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. - ------------- (9) To be inserted on installment Equipment Notes. IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Indenture to be duly executed by their respective officers thereof duly authorized, as of the date first above written. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Owner Trustee, By:______________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Loan Trustee By:______________________________________ Name: Title: EXHIBIT A to AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT INDENTURE SUPPLEMENT NO. ___ INDENTURE SUPPLEMENT NO. __ , dated _____________, ____ ("Indenture Supplement"), between WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, but solely as Owner Trustee ("Owner Trustee") under that certain Trust Agreement (N____) dated as of [_______________] (the "Trust Agreement"), between Owner Trustee and Owner Participant named therein and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee under the Indenture (each as hereinafter defined). W I T N E S S E T H: WHEREAS, the Amended and Restated Indenture and Security Agreement (N[_____]), dated as of [__________ __, 200_] (the "Indenture"; capitalized terms used herein without definition shall have the meanings specified therefor in Annex A to the Indenture), between Owner Trustee and State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity, except as expressly provided therein, but solely as Loan Trustee ("Loan Trustee"), provides for the execution and delivery of supplements thereto substantially in the form hereof which shall particularly describe the Aircraft, and shall specifically grant a security interest in the Aircraft to Loan Trustee; and [WHEREAS, the Indenture relates to the Airframe and Engines described in Annex A attached hereto and made a part hereof, and a counterpart of the Indenture is attached to and made a part of this Indenture Supplement;]* [WHEREAS, Owner Trustee has, as provided in the Indenture, heretofore executed and delivered to Loan Trustee Indenture Supplement(s) for the purpose of specifically subjecting to the Lien of the Indenture certain airframes and/or engines therein described, which Indenture Supplement(s) is/are dated and has/have been duly recorded with the FAA as set forth below, to wit: Date Recordation Date FAA Document Number]** - ---- ---------------- -------------------- NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and the performance and observance by Owner Trustee of all the agreements and covenants to be performed or observed by Owner Trustee for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Owner Trustee at or before the Delivery Date, the receipt of which is hereby acknowledged, Owner Trustee does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Owner Trustee in, to and under the Aircraft, including the Airframe and Engines described in Annex A attached hereto, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided in the Indenture, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto; Notwithstanding any provision hereof, no Excluded Payment shall constitute security for any of the aforementioned obligations. To have and to hold all and singular the aforesaid property unto Loan Trustee, and its successors and assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in the Indenture, including Section 2.13 and Article III of the Indenture, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and subject to the terms and provisions set forth in the Indenture. This Indenture Supplement shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and is hereby ratified, approved and confirmed. Owner Trustee hereby acknowledges that the Aircraft referred to in this Indenture Supplement has been delivered to Owner Trustee and is included in the property of Owner Trustee covered by all the terms and conditions of the Trust Agreement, subject to the pledge and mortgage thereof under the Indenture. THIS INDENTURE SUPPLEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement No. __ to be duly executed by their respective duly authorized officers, on the date first above written. WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Owner Trustee By:____________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By:____________________________________ Name: Title: - ------------- * Use for Indenture Supplement No. 1 only. ** Use for all Indenture Supplements other than Indenture Supplement No. 1. Annex A to Indenture Supplement No. __ DESCRIPTION OF AIRFRAME AND ENGINES AIRFRAME Manufacturer Model FAA Registration No. Manufacturer's Serial No. - ------------ ----- -------------------- ------------------------- ENGINES Manufacturer Model Manufacturer's Serial No. - ------------ ----- ------------------------- Each Engine is of 750 or more "rated take-off horsepower" or the equivalent of such horsepower. SCHEDULE I to AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT DESCRIPTION OF EQUIPMENT NOTES Original Principal Amount Interest Rate Maturity Date ------------------------- ------------- ------------- Series G-1 Equipment Notes: $[___________] 6.718% [___________] Series G-2 Equipment Notes: $[___________] 6.417% July 2, 2012 Series C Equipment Notes: $[___________] 7.779% [___________] EQUIPMENT NOTES AMORTIZATION SERIES G-1 EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid ------------ ---------- The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. EQUIPMENT NOTES AMORTIZATION SERIES C EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid ------------ ---------- The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. SCHEDULE II to AMENDED AND RESTATED INDENTURE AND SECURITY AGREEMENT PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST SUPPLEMENTS Pass Through Trust Agreement, dated as of November 16, 2000, between Delta Air Lines, Inc. and State Street Bank and Trust Company of Connecticut, National Association, as trustee, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, and Trust Supplement No. 2002-1C, dated as of April 30, 2002. EXHIBIT J TO PARTICIPATION AGREEMENT FORM OF PURCHASE AGREEMENT ASSIGNMENT ================================================================================ PURCHASE AGREEMENT ASSIGNMENT (N____) Dated as of [______ __, 200_] between DELTA AIR LINES, INC., Assignor and WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, Assignee --------------- One Boeing 737-832 Aircraft ================================================================================ PURCHASE AGREEMENT ASSIGNMENT (N____) This PURCHASE AGREEMENT ASSIGNMENT (N____), dated as of [______ __, 200_] between DELTA AIR LINES, INC., a Delaware corporation ("Assignor"), and WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee ("Assignee") (the "Assignment"). W I T N E S S E T H: WHEREAS, pursuant to the Purchase Agreement No. 2022, dated as of October 21, 1997 between Assignor and Manufacturer, which incorporates by reference the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997 between Assignor and Manufacturer ("AGTA-DAL") (the "Purchase Agreement"), Manufacturer has agreed to sell and Assignor has agreed to purchase several Boeing 737-832 aircraft, including the Aircraft covered by the Participation Agreement; WHEREAS, pursuant to the Participation Agreement, Assignor has agreed to sell and Assignee has agreed to purchase, the Aircraft; WHEREAS, Assignor and Assignee are entering into a Lease Agreement (N_____), dated as of the date hereof (as the same may hereafter from time to time be supplemented, amended or modified, the "Lease"), pursuant to which the Aircraft will be leased by Assignee to Assignor; and WHEREAS, Assignor, on the terms and conditions herein and in the Manufacturer's Consent dated as of the date hereof executed by Manufacturer attached hereto (the "Manufacturer's Consent"), desires to assign to Assignee certain of Assignor's rights and interests in and under the Purchase Agreement relating to the Aircraft, and Assignee desires to accept such assignment, as hereinafter set forth; NOW, THEREFORE, in consideration of the mutual covenants herein contained and for other good and valuable consideration, the parties hereto agree as follows: 1. Assignment; Rights Reserved. Subject to the provisions of paragraph 3(a) hereof, Assignor does hereby sell, assign, transfer and set over unto Assignee, except to the extent reserved below, all of Assignor's right, title and interest in, to and under Parts 1,2,3,4 and 6 of the Product Assurance Document attached as Exhibit C to the AGTA-DAL, but only to the extent that the same relate to the continuing rights of Assignor in respect of any warranty or indemnity, express or implied, pursuant to the Product Assurance Document with respect to the Airframe (collectively, the "Warranty Rights"). 2. Acceptance of Assignment. Assignee hereby accepts the assignment contained in paragraph 1 hereof. 3. Rights of Assignor in Absence of Event of Default. (a) With respect to the assignment contained in paragraph 1 hereof, and notwithstanding the foregoing, if and so long as (A) the Aircraft is subject to the Lease and (B) Manufacturer has not received notice from Loan Trustee or Owner Trustee (including by mail, courier, telecopy or telex thereof from Loan Trustee or Owner Trustee addressed to Manufacturer's Vice President, Contracts, at P.O. Box 3707, Mail Code 21-34, Seattle, Washington 98124, if by mail; 1901 Oaksdale Ave., S.W., Mail Code 21-34, Renton, Washington 98055, if by courier; 425-237-1706 if by telecopy; and 32-9430 (Answerback BOEINGREN RNTN), if by telex), that an Event of Default under the Lease has occurred and is continuing, (1) Assignee authorizes Assignor, on behalf of but to the exclusion of Assignee, to exercise in Assignor's own name (i) all rights and powers related to the Warranty Rights as and to the extent the same relate to the Aircraft and (ii) subject to paragraph 3(c) hereof, to retain any recovery or benefit resulting from the enforcement of the Warranty Rights as and to the extent the same relate to the Aircraft, and (2) Assignee shall, at Assignor's expense, cooperate with Assignor and take such actions as Assignor reasonably deems necessary to enable Assignor to enforce such rights and claims. (b) Effective upon the receipt by Manufacturer of written notice from Loan Trustee or Owner Trustee that an Event of Default under the Lease has occurred and is continuing and thereafter until Manufacturer has received written notice from Loan Trustee or Owner Trustee that such Event of Default has been cured or waived: (i) at Assignee's option, the authorization given to Assignor under paragraph 3(a) hereof to enforce such rights and claims shall henceforth cease to be effective and Assignee and its successors and permitted assigns shall, to the exclusion of Assignor, be entitled to assert and enforce such rights and claims as substitute party plaintiff or otherwise, and Assignor shall, at the request of Assignee or its successors or assigns and at Assignor's expense, cooperate with and take such action as reasonably necessary to enable Assignee and its successors and assigns to enforce such rights and claims, and Assignee, if it elects to enforce such rights or claims, shall use its best efforts to assert and enforce such rights and claims, and (ii) Assignor will be deemed to have irrevocably constituted Assignee and its successors and permitted assigns Assignor's true and lawful attorney (it being acknowledged that such appointment is coupled with an interest, namely Assignee's rights acquired and to be acquired hereunder) with full power (in the name of Assignor or otherwise) to ask, require, demand, receive, settle, compromise, compound and give acquittance for any and all monies and claims for monies due and to become due under, or arising out of, the Warranty Rights as and to the extent the same relate to the Aircraft, to the extent that the same have been assigned by this Assignment, and for such period as Assignee may exercise rights with respect thereto under this clause (ii), to endorse any checks or other instruments or orders in connection therewith and to file any claims or take any action or institute (or, if previously commenced, assume control of) any proceedings and to obtain any recovery in connection therewith which Assignee may deem to be necessary or advisable in the premises. (c) Notwithstanding this Assignment and anything herein to the contrary, all amounts that Manufacturer is obligated to pay to Assignor pursuant to the Warranty Rights as and to the extent the same relate to the Aircraft (a "Manufacturer Payment"), will be payable and applicable as follows: so long as the Aircraft is subject to the Lease, all the Manufacturer Payments shall be paid to Assignor unless and until Manufacturer has received written notice from Loan Trustee or Owner Trustee that an Event of Default under the Lease has occurred and is continuing, whereupon Manufacturer will, until Manufacturer has received written notice from Loan Trustee or Owner Trustee that such Event of Default under the Lease have been cured or waived, make any and all such payments directly to Loan Trustee or (if written notice has been given to Manufacturer by Assignee that the Indenture is no longer in effect in accordance with its terms and all amounts due and payable under the Equipment Notes have been paid in full) Assignee. Any amounts received by Assignee pursuant to the immediately preceding sentence shall, to the extent not theretofore applied in satisfaction of sums owing to Assignee in accordance with the terms of the Lease, be returned to Assignor promptly after all Events of Default under the Lease have been cured or waived. (d) For all purposes of this Assignment, Manufacturer shall not be deemed to have received written notice from Loan Trustee or Owner Trustee that an Event of Default under the Lease has occurred and is continuing or that all Events of Default have been cured or waived unless and until Manufacturer has received written notice thereof from Owner Trustee or Loan Trustee addressed to Manufacturer's Vice President, Contracts, at P.O. Box 3707, Mail Code 21-34, Seattle, Washington 98124, (Telex: 32-9430, Answerback BOEINGREN RNTN) and, in acting in accordance with the terms and conditions of the Purchase Agreement and this Assignment, Manufacturer may rely conclusively upon any such notice. With respect to the rights, powers, duties and obligations of "Customer" under the Purchase Agreement, all actions taken or agreements entered into by Assignor during the period prior to Manufacturer's receipt of such notice are final and binding on Assignee and Loan Trustee. In the event of receipt by Manufacturer of conflicting notice, notice from Loan Trustee shall control. 4. Certain Rights and Obligations of the Parties. (a) Anything herein contained to the contrary notwithstanding: (i) Assignor shall at all times remain liable to Manufacturer under the Purchase Agreement in respect of the Aircraft to perform all of the duties and obligations of the "Customer" thereunder to the same extent as if this Assignment had not been executed; (ii) the exercise by Assignee of any of the rights assigned hereunder shall not release Assignor from any of its duties or obligations to Manufacturer under the Purchase Agreement in respect of the Aircraft except to the extent that such exercise by Assignee constitutes performance of such duties and obligations; and (iii) except as provided in paragraph 4(b) hereof, Assignee shall not have any obligation or liability under the Purchase Agreement by reason of, or arising out of, this Assignment or be obligated to perform any of the obligations or duties of Assignor under the Purchase Agreement or to make any payment or make any inquiry as to the sufficiency of any payment received by it or to present or to file any claim or to take any other action to collect or enforce any claim for any payment assigned hereunder. (b) Without in any way releasing Assignor from any of its duties or obligations under the Purchase Agreement, Assignee confirms for the benefit of Manufacturer that, insofar as the provisions of the Purchase Agreement relate to the Aircraft, in exercising any rights under the Purchase Agreement, or in making any claim with respect to the Warranty Rights, the terms and conditions of the Purchase Agreement shall apply to, and be binding upon, Assignee to the same extent as Assignor. Assignee hereby confirms that it shall be deemed for all purposes to have read and be familiar with the Purchase Agreement (insofar as it relates to the Aircraft) and to understand thoroughly the terms and conditions thereof. (c) Nothing contained herein shall (i) subject Manufacturer to any liability to which it would not otherwise be subject under the Purchase Agreement or (ii) modify in any respect Manufacturer's contract rights thereunder, except as provided in the Manufacturer's Consent attached hereto. (d) The parties hereto, and Manufacturer by its execution and delivery of the Manufacturer's Consent, agree that all of the statements, representations, covenants and agreements made by Assignee as Owner Trustee (when made in such capacity) contained in this Assignment and any agreement referred to herein or in the Participation Agreement other than the Trust Agreement, unless expressly otherwise stated, are made and intended only for the purpose of binding the Trust Estate and establishing the existence of rights and remedies which can be exercised and enforced against the Trust Estate. Therefore, anything contained in this Assignment or such other agreements to the contrary notwithstanding (except for any express provisions that Assignee is responsible for in its individual capacity), no recourse shall be had with respect to this Assignment or such other agreements against Assignee in its individual capacity or against any institution or person which becomes a successor trustee or co-trustee or any officer, director, trustee, servant or direct or indirect parent or controlling person or persons of any of them; provided, however, that this Section 4(d) shall not be construed to prohibit any action or proceeding against Wells Fargo Bank Northwest, National Association, for its own willful misconduct or negligent conduct for which it would otherwise be liable; and provided, further, that nothing contained in this Section 4(d) shall be construed to limit the exercise and enforcement in accordance with the terms of this Assignment or such other agreements of rights and remedies against the Trust Estate. The foregoing provisions of this Section 4(d) shall survive the termination of this Assignment and the other Operative Documents. 5. Further Assurances. Assignor agrees that at any time and from time to time Assignor will promptly and duly execute and deliver any and all such further instruments and documents and take such further action as Assignee may reasonably request in writing in order to obtain the full benefits of this Assignment and of the rights and powers herein granted, provided, however, that the execution and delivery of any such instrument or document shall not in any way limit or restrict the rights or enlarge the obligations of Assignor in respect of any of the Operative Documents. 6. Assignor's Representations, Warranties and Covenants. Assignor hereby represents and warrants that, except for an assignment of the rights hereby assigned pursuant to the Original Indenture (such assignment to be released on the Delivery Date), Assignor has not assigned or pledged, and hereby covenants that it will not assign or pledge, so long as this Assignment remains in effect, the whole or any part of the rights hereby assigned to anyone other than Assignee. 7. No Amendment of Purchase Agreement. Assignee agrees that it will not enter into any amendment, modification, supplement, rescission, cancellation or termination of the Purchase Agreement in respect of the Warranty Rights, as and to the extent the same relate to the Aircraft, without the prior written consent of Assignor. 8. Execution of Assignment. This Assignment is being executed and delivered by Assignor and Assignee concurrently with the execution and delivery of the Lease. 9. Binding Effect. This Assignment shall be binding upon and shall inure to the benefit of Assignor, Assignee and their respective successors and permitted assigns. 10. GOVERNING LAW. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS ASSIGNMENT IS BEING DELIVERED IN THE STATE OF NEW YORK. 11. Definitions. All terms not defined herein, which are used herein in capitalized form and which are defined in the Lease, shall when used herein have the meanings specified or referred to in the Lease. 12. Notice. Except as otherwise expressly provided herein, notice hereunder may be given, and shall be deemed to have been received when given, as provided in Section 17 of the Lease. 13. Counterparts. This Assignment may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all of such counterparts shall together constitute but one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this Purchase Agreement Assignment to be duly executed as of the day and year first above written. DELTA AIR LINES, INC., as Assignor By: ____________________________________ Name: Title: WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee, as Assignee By: ____________________________________ Name: Title: The undersigned, not in its individual capacity but solely as Loan Trustee for the benefit of the holders of the Equipment Notes and as assignee of, and holder of a security interest in and to the foregoing Purchase Agreement Assignment and the Purchase Agreement pursuant to such Purchase Agreement Assignment, agrees to the terms of the foregoing Purchase Agreement Assignment and agrees that its rights and remedies under such Purchase Agreement Assignment shall be subject to the terms and conditions thereof and of the Purchase Agreement. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee By: ____________________________________ Name: Title: EXHIBIT K TO PARTICIPATION AGREEMENT FORM OF TRUST AGREEMENT ================================================================================ TRUST AGREEMENT (N_____) Dated as of [____________, 200_] between [_______________________], Owner Participant and WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, Owner Trustee One Boeing 737-832 Aircraft ================================================================================ TRUST AGREEMENT (N_____) This TRUST AGREEMENT (N_____) dated as of [___________, 200_] between [_____________________], a [___________] corporation ("Original Owner Participant"), and WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, a national banking association (in its individual capacity, "Wells Fargo") and otherwise not in its individual capacity but solely as trustee hereunder (herein in such capacity with its permitted successors and assigns called "Owner Trustee"); W I T N E S S E T H: ARTICLE I DEFINITIONS AND TERMS SECTION 1.01. Certain Definitions. Unless the context shall otherwise require and except as contained in this Section 1.01, the capitalized terms used herein have the respective meanings assigned thereto in the Lease (as hereinafter defined) for all purposes hereof. All definitions contained in this Section 1.01 shall be equally applicable to both the singular and plural forms of the terms defined. For all purposes of this Trust Agreement the following terms shall have the following meanings: "Lease" means that certain Lease Agreement (N_____), to be dated as of the date hereof, and to be entered into by Owner Trustee and Lessee concurrently with the execution and delivery of this Trust Agreement, as said Lease Agreement may from time to time be supplemented or amended, or the terms thereof waived or modified, to the extent permitted by, and in accordance with, the terms of this Trust Agreement. The term "Lease" shall also include each Lease Supplement from time to time entered into pursuant to the terms of the Lease. "Lessee" means Delta Air Lines, Inc., a Delaware corporation, and its permitted successors and assigns. "Owner Participant" means Original Owner Participant and each Subsequent Owner Participant to the extent that the same shall, at the relevant time, have an Ownership Interest. "Ownership Interest" means, in the case of each Owner Participant, the percentage of its undivided beneficial interest in the Trust Estate created by this Trust Agreement, which percentage shall be 100%. "Subsequent Owner Participant" means any corporation to which Original Owner Participant or any transferee from Original Owner Participant or any Subsequent Owner Participant shall have transferred at any time after the Delivery Date all of the undivided right, title and interest originally held by Original Owner Participant in this Trust Agreement, the Trust Estate and the Participation Agreement, to the extent permitted by Section 8.01 of this Trust Agreement and Section 5.02 of the Participation Agreement, provided that any such transfer: (i) shall be effected by a written agreement, in form and substance reasonably satisfactory to Owner Trustee in its individual capacity, among such transferee, its transferor and Owner Trustee, which shall provide that such transferee thereby becomes a party to, and beneficiary of, this Trust Agreement and an Owner Participant for all purposes hereof and that such transferee assumes all of the obligations of its transferor under this Trust Agreement; and (ii) so long as the Lease shall be in effect or any Equipment Notes remain unpaid, such transferee and its transferor shall have complied with all of the terms of Section 5.02(i) of the Participation Agreement. "Trust Estate" means all estate, right, title and interest of Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the Purchase Agreement, the Purchase Agreement Assignment, the Bill of Sale and the FAA Bill of Sale, including, without limitation, all amounts of Basic Rent and Supplemental Rent including without limitation insurance proceeds (other than insurance proceeds payable to or for the benefit of Owner Trustee, for its own account or in its individual capacity, Owner Participant, Noteholders or Loan Trustee) and requisition, indemnity or other payments of any kind for or with respect to the Aircraft (except amounts owing to Owner Participant, to Loan Trustee, to Owner Trustee, in its individual capacity, or to Noteholders or any other holder of an Equipment Note, or to any of their respective directors, officers, employees, servants and agents, pursuant to Section 4.02 or 4.03 of the Participation Agreement). Notwithstanding the foregoing, "Trust Estate" shall not include any Excluded Payments. "Trust Office" shall mean the principal corporate trust office of Owner Trustee at MAC: U1254-031, 79 South Main Street, Salt Lake City, Utah 84111, Attention: Corporate Trust Department, or the principal corporate trust office of any successor Owner Trustee. ARTICLE II AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS; DECLARATION OF TRUST SECTION 2.01. Authority to Execute Documents. Owner Participant hereby authorizes and directs Owner Trustee to execute and deliver the Operative Documents and any other agreements, instruments or documents to which Owner Trustee is a party in the respective forms thereof in which delivered from time to time by Owner Participant to Owner Trustee for execution and delivery and, subject to the terms hereof, to perform its duties and, upon instructions from Owner Participant, exercise its rights under said Operative Documents in accordance with the terms thereof. SECTION 2.02. Declaration of Trust. Owner Trustee hereby declares that it will hold the Trust Estate upon the trusts hereinafter set forth for the use and benefit of Owner Participant, subject, however, to the provisions of and the Lien created by the Indenture and to the provisions of the Lease. The name of the trust created hereby shall be "(N____ 200_ Trust)" and such name may (but need not) be used in any correspondence and filings made by Owner Trustee in connection with the trust created hereby. ARTICLE III ACCEPTANCE AND DELIVERY OF AIRCRAFT; ISSUANCE OF EQUIPMENT NOTES SECTION 3.01. Acceptance of Aircraft. Original Owner Participant hereby authorizes and directs Owner Trustee to, and Owner Trustee agrees for the benefit of Owner Participant that it will, on the Delivery Date, subject to due compliance with the terms of Section 3.02 hereof: (a) purchase the Aircraft pursuant to the Participation Agreement and the Bill of Sale; (b) accept from Lessee the delivery of the Bill of Sale and the FAA Bill of Sale; (c) cause the Aircraft to be leased to Lessee under the Lease, and in furtherance thereof execute and deliver a Lease Supplement covering the Aircraft; (d) execute and deliver the Amended and Restated Indenture and the Indenture Supplement covering the Aircraft; (e) issue to Subordination Agent (on behalf of Pass Through Trustees) Assumed Equipment Notes in the amounts and otherwise as provided in Section 2.01 of the Participation Agreement; (f) execute and deliver the financing statements referred to in Section 3.01(e) of the Participation Agreement, together with all other agreements, documents and instruments referred to in Section 3.01 of the Participation Agreement to which Owner Trustee is a party; and (g) effect the registration of the Aircraft in the name of Owner Trustee by filing or causing to be filed with the FAA: (i) the FAA Bill of Sale; (ii) an application for registration of the Aircraft in the name of Owner Trustee (including without limitation an affidavit from Owner Trustee in compliance with the provisions of 14 C.F.R. ss. 47.7(c)(2)(ii) (1979)); and (iii) the Trust Agreement. SECTION 3.02. Conditions Precedent. The right and obligation of Owner Trustee to take the action required by Section 3.01 hereof with respect to the Aircraft shall be subject to the following conditions precedent: (a) Original Owner Participant shall have made the full amount of its Commitment set forth in Schedule I to the Participation Agreement available to Owner Trustee, in immediately available funds, in accordance with Section 2.02 of the Participation Agreement; and (b) the terms and conditions of Section 3.01 of the Participation Agreement, insofar as they relate to the Aircraft, shall have been complied with in a manner satisfactory to Original Owner Participant and Owner Trustee. SECTION 3.03. Authorization in Respect of a Termination of the Lease and Assumption of the Equipment Notes. Owner Participant hereby authorizes and directs Owner Trustee to, and Owner Trustee agrees for the benefit of Owner Participant that it will, take the actions specified to be taken by Owner Trustee in Section 6.01(k) of the Participation Agreement upon Lessee's purchasing the Aircraft pursuant to Section 19(d) of the Lease and upon Lessee's assuming the indebtedness evidenced by the Equipment Notes in accordance with the provisions of such Section 6.01(k). SECTION 3.04. Authorization in Respect of a Replacement Airframe or Replacement Engines. Owner Participant hereby authorizes and directs Owner Trustee to, and Owner Trustee agrees for the benefit of Owner Participant that it will, in the event of a Replacement Airframe and Replacement Engines, if any, being substituted pursuant to Section 10(a) of the Lease, or a Replacement Engine being substituted pursuant to Section 10(b) of the Lease, subject to due compliance with the terms of Section 10(a) or 10(b) of the Lease, as the case may be: (a) to the extent not previously accomplished by a prior authorization, authorize a representative or representatives of Owner Trustee (who shall be an employee or employees of Lessee) to accept delivery of the Replacement Airframe and Replacement Engines, if any, or the Replacement Engines; (b) accept from Lessee or other vendor of the Replacement Airframe and Replacement Engines, if any, or the Replacement Engine a bill of sale or bills of sale (if tendered), and the invoice, if any, with respect to the Replacement Airframe and Replacement Engines, if any, or the Replacement Engine being furnished pursuant to Section 10(a) or (b) of the Lease; (c) in the case of a Replacement Airframe, make application to the FAA for the registration in the name of Owner Trustee of the Aircraft of which such Replacement Airframe is a part; (d) execute and deliver a Lease Supplement and an Indenture Supplement covering (i) the Aircraft of which such Replacement Airframe is part or (ii) such Replacement Engine, as the case may be; (e) transfer its interest in (without recourse except as to obligations in respect of Lessor Liens, including for this purpose Liens that would be Lessor Liens but for the proviso in the definition of Lessor Liens) and to the Airframe and Engines (if any) or the Engine being replaced to Lessee; (f) request in writing that Loan Trustee execute and deliver to Lessee appropriate instruments to release the Airframe and Engines or engines (if any) or the Engine or engine being replaced from the Lien created under the Indenture and release the Purchase Agreement and the Purchase Agreement Assignment (solely with respect to such replaced Airframe and Engines, if any, or Engine) from the assignment and pledge under the Indenture; and (g) upon instructions from Owner Participant, take such further action as may be contemplated by clauses (B) and (C) of the fourth paragraph of Section 10(a) of the Lease, the sixth paragraph of Section 10(a) of the Lease, clauses (ii) and (iii) of the second sentence of Section 10(b) of the Lease or and the penultimate sentence of Section 10(b) of the Lease, as the case may be. SECTION 3.05. Trust Agreement Remaining in Full Force and Effect. In the event of the substitution of a Replacement Airframe for the Airframe or the substitution of a Replacement Engine for any Engine or engine, all provisions of this Trust Agreement relating to such replaced Airframe or Engine or engine shall be applicable to such Replacement Airframe or Replacement Engine with the same force and effect as if such Replacement Airframe or Replacement Engine were the same airframe or engine as the Airframe or Engine being replaced but for the Event of Loss with respect to such Airframe or Engine. SECTION 3.06. Authorization in Respect of a Return of an Engine. Owner Participant hereby authorizes and directs Owner Trustee to, and Owner Trustee agrees for the benefit of Owner Participant that it will, in the event of an engine being transferred to Owner Trustee pursuant to Section 5(b) of the Lease, subject to due compliance with the terms of such Section 5(b): (a) accept from Lessee the bill of sale with respect to such engine contemplated by such Section 5(b) (if tendered); (b) transfer its interest in (without recourse except as to obligations in respect of Lessor Liens, including for this purpose Liens that would be Lessor Liens but for the proviso in the definition of Lessor Liens) and to an Engine to Lessee as contemplated by such Section 5(b); and (c) request in writing that Loan Trustee execute and deliver to Lessee appropriate instruments to release the Engine being transferred to Lessee pursuant to such Section 5(b) from the Lien of the Indenture and to release the Purchase Agreement and the Purchase Agreement Assignment (solely with respect to such Engine) from the assignment and pledge under the Indenture. ARTICLE IV RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE TRUST ESTATE SECTION 4.01. Distribution of Payments. (a) Payments to Loan Trustee. Until the Indenture shall have been discharged pursuant to Section 10.01 thereof, all Basic Rent, Supplemental Rent, insurance proceeds and requisition or other payments of any kind included in the Trust Estate (other than Excluded Payments) payable to Owner Trustee shall be payable directly to Loan Trustee (and if any of the same are received by Owner Trustee shall upon receipt be paid over to Loan Trustee without deduction, set-off or adjustment of any kind) for distribution in accordance with the provisions of Article III of the Indenture. (b) Payments to Owner Trustee; Other Parties. After the Indenture shall have been discharged pursuant to Section 10.01 thereof, any payment of the type referred to in Section 4.01(a) hereof (other than Excluded Payments) received by Owner Trustee, any payments received from Loan Trustee other than as specified in Section 4.01(d) hereof and any other amount received as part of the Trust Estate and for the application or distribution of which no provision is made herein, shall be distributed forthwith upon receipt by Owner Trustee in the following order of priority: first, so much of such payment as shall be required to reimburse Owner Trustee for any expenses not otherwise reimbursed as to which Owner Trustee is entitled to be so reimbursed pursuant to the provisions hereof shall be retained by Owner Trustee; second, so much of the remainder for which provision as to the application thereof is contained in the Lease or any of the other Operative Documents shall be applied and distributed in accordance with the terms of the Lease or such other Operative Document; and third, the balance, if any, shall be paid to Owner Participant. (c) Certain Distributions to Owner Participant. All amounts from time to time distributable by Loan Trustee to Owner Participant pursuant to the Indenture shall, if paid to Owner Trustee, be distributed by Owner Trustee to Owner Participant in accordance with the provisions of Article III of the Indenture. (d) Excluded Payments. Any Excluded Payments received by Owner Trustee shall be paid by Owner Trustee to the Person to whom such Excluded Payments are payable under the provisions of the Participation Agreement, the Tax Indemnity Agreement or the Lease. SECTION 4.02. Method of Payments. Owner Trustee shall make distributions or cause distributions to be made to Owner Participant pursuant to this Article IV by transferring by wire transfer the amount to be distributed to such account or accounts of Owner Participant as Owner Participant may designate from time to time in writing to Owner Trustee. Notwithstanding the foregoing, Owner Trustee will, if so requested by Owner Participant in writing, pay any or all amounts payable to Owner Participant pursuant to this Article IV either (i) by crediting such amount or amounts to an account or accounts maintained by Owner Participant with Owner Trustee in its individual capacity in immediately available funds, (ii) by payment at the Trust Office of Owner Trustee, in immediately available funds, or (iii) by mailing an official bank check or checks in such amount or amounts payable to Owner Participant at such address as Owner Participant shall have designated in writing to Owner Trustee. ARTICLE V DUTIES OF OWNER TRUSTEE SECTION 5.01. Notice of Event of Default. If Owner Trustee shall have knowledge of a Lease Event of Default or an Indenture Event of Default (or an event which with the passage of time or the giving of notice or both would constitute a Lease Event of Default or an Indenture Event of Default) Owner Trustee shall give to Owner Participant prompt telephonic or telecopy notice thereof followed by prompt confirmation thereof by certified mail, postage prepaid, provided that (i) in the case of an event which with the passage of time would constitute an Indenture Event of Default referred to in paragraph (c) of Section 4.02 of the Indenture, such notice shall in no event be furnished later than ten (10) days after Owner Trustee shall first have knowledge of such event and (ii) in the case of a misrepresentation by Owner Trustee which with the passage of time would constitute an Indenture Event of Default referred to in paragraph (d) of Section 4.02 of the Indenture, such notice shall in no event be furnished later than ten (10) days after Owner Trustee shall first have knowledge of such event. Subject to the terms of Section 5.03 hereof, Owner Trustee shall take such action or shall refrain from taking such action, not inconsistent with the provisions of the Indenture, with respect to such Lease Event of Default, Indenture Event of Default or other event as Owner Trustee shall be directed in writing by Owner Participant. If Owner Trustee shall not have received instructions as above provided within twenty (20) days after the mailing of such notice to Owner Participant, Owner Trustee until instructed otherwise in accordance with the preceding sentence may, but shall be under no duty to, take or refrain from taking such action with respect to such Lease Event of Default, Indenture Event of Default or other event, not inconsistent with the provisions of the Indenture, as it shall deem advisable in the best interests of Owner Participant. For all purposes of this Trust Agreement, the Lease and the other Operative Documents, in the absence of actual knowledge by an officer of Wells Fargo in the Corporate Trust Department, Owner Trustee shall not be deemed to have knowledge of a Lease Event of Default, an Indenture Event of Default or other event referred to in this Section 5.01 unless notified in writing by Loan Trustee, Owner Participant or Lessee. SECTION 5.02. Action Upon Instructions. Subject to the terms of Sections 5.01 and 5.03 hereof, upon the written instructions at any time and from time to time of Owner Participant, Owner Trustee will take such of the following actions, not inconsistent with the provisions of the Indenture, as may be specified in such instructions: (i) give such notice or direction or exercise such right, remedy or power hereunder or under any of the Operative Documents to which Owner Trustee is a party or in respect of all or any part of the Trust Estate as shall be specified in such instructions (including entering into agreements referred to in clause (i) of the definition of "Subsequent Owner Participant"); (ii) take such action to preserve or protect the Trust Estate (including the discharge of Liens) as may be specified in such instructions; (iii) approve as satisfactory to it all matters required by the terms of the Lease or the other Operative Documents to be satisfactory to Owner Trustee, it being understood that without written instructions of Owner Participant, Owner Trustee shall not approve any such matter as satisfactory to it (it being understood that the provisions of Sections 3.03, 3.04 and 3.06 hereof do not constitute instructions by Owner Participant for Owner Trustee to approve of or consent to the matters to be approved of or consented to by Owner Trustee in the sections of the Lease referred to in Sections 3.03, 3.04 or 3.06 hereof); and (iv) subject to the rights of Lessee under the Operative Documents, after the expiration or earlier termination of the Lease, deliver the Aircraft to Owner Participant in accordance with such instructions, convey all of Owner Trustee's right, title and interest in and to the Aircraft for such amount, on such terms and to such purchaser or purchasers as shall be designated in such instructions, or net lease the Aircraft on such terms and to such lessee or lessees as shall be designated in such instructions. SECTION 5.03. Indemnification. Owner Trustee shall not be required to take any action under Section 5.01 (other than the giving of the notices referred to therein) or 5.02 hereof unless Owner Trustee shall have been indemnified by Owner Participant, in manner and form satisfactory to Owner Trustee, against any liability, cost or expense (including reasonable counsel fees and disbursements) which may be incurred in connection therewith; and, if Owner Participant shall have directed Owner Trustee to take any such action or refrain from taking any action, Owner Participant agrees to furnish such indemnity as shall be required and, in addition, to the extent not otherwise paid pursuant to the provisions of the Lease or the Participation Agreement, to pay the reasonable compensation of Owner Trustee for the services performed or to be performed by it pursuant to such direction and any fees and disbursements of counsel or agents employed by Owner Trustee in connection therewith. Owner Trustee shall not be required to take any action under Section 5.01 or 5.02 hereof if Owner Trustee shall reasonably determine, or shall have been advised by counsel, that such action is contrary to the terms of any of the Operative Documents to which Owner Trustee is a party, or is otherwise contrary to law. SECTION 5.04. No Duties Except as Specified in Trust Agreement or Instructions. Owner Trustee shall not have any duty or obligation to manage, control, use, sell, dispose of or otherwise deal with the Aircraft or any other part of the Trust Estate, or to otherwise take or refrain from taking any action under, or in connection with any of the Operative Documents to which Owner Trustee is a party, except as expressly required by the terms of any of the Operative Documents to which Owner Trustee is a party, or (to the extent not inconsistent with the provisions of the Indenture) as expressly provided by the terms hereof or in written instructions from Owner Participant received pursuant to the terms of Section 5.01 or 5.02, and no implied duties or obligations shall be read into this Trust Agreement against Owner Trustee. Wells Fargo agrees that it will, in its individual capacity and at its own cost or expense (but without any right of indemnity in respect of any such cost or expense under Section 7.01 hereof) promptly take such action as may be necessary to duly discharge and satisfy in full all Lessor Liens which it is required to discharge pursuant to Section 6.01(g) of the Participation Agreement and otherwise comply with the terms of said Section binding on it. SECTION 5.05. Satisfaction of Conditions Precedent. Anything herein to the contrary notwithstanding, Owner Trustee shall comply with the provisions of Section 3.01 hereof upon the satisfaction, to the satisfaction of special counsel for Owner Trustee, of all the applicable conditions precedent specified in Section 3.02 hereof and in Section 3.01 of the Participation Agreement. SECTION 5.06. No Action Except Under Specified Documents or Instructions. Owner Trustee shall not have any power, right or authority to, and Owner Trustee agrees that it will not, manage, control, use, sell, dispose of or otherwise deal with the Aircraft or any other part of the Trust Estate except (i) as expressly required by the terms of any of the Operative Documents to which Owner Trustee is a party, (ii) as expressly provided by the terms hereof, or (iii) as expressly provided in written instructions from Owner Participant pursuant to Section 5.01 or 5.02 hereof. ARTICLE VI OWNER TRUSTEE SECTION 6.01. Acceptance of Trusts and Duties. Wells Fargo accepts the trusts hereby created and agrees to perform the same but only upon the terms hereof applicable to it. Owner Trustee also agrees to receive and disburse all monies received by it constituting part of the Trust Estate upon the terms hereof. Wells Fargo shall not be answerable or accountable under any circumstances, except (a) for its own willful misconduct or negligence, (b) for performance of the terms of the last sentence of Section 5.04 hereof, (c) for its or Owner Trustee's failure to use ordinary care to disburse funds and (d) for liabilities that may result from the inaccuracy of any representation or warranty of it (or from the failure by it to perform any covenant) in Section 6.03 hereof, in Section 6.03 of the Indenture, in Section 4 of the Lease or in Section 5.03 and 6.01(e) of the Participation Agreement. SECTION 6.02. Absence of Certain Duties. Except in accordance with written instructions furnished pursuant to Section 5.02 hereof and except as provided in, and without limiting the generality of, Section 5.04 hereof and the last sentence of Section 9.01(b) hereof, neither Owner Trustee nor Wells Fargo shall have any duty (i) to see to any recording or filing of any Operative Document or of any supplement to any thereof or to see to the maintenance of any such recording or filing or any other filing of reports with the FAA or other governmental agencies, except that Wells Fargo, in its individual capacity, shall comply with the reporting requirements set forth in 14 C.F.R. ss. 47.45 or any successor provision and Owner Trustee shall, to the extent that information for that purpose is supplied by Lessee pursuant to any of the Operative Documents, complete and timely submit (and furnish Owner Participant with a copy of) any and all reports relating to the Aircraft which may from time to time be required by the FAA or any government or governmental authority having jurisdiction, or (ii) to see to any insurance on the Aircraft or to effect or maintain any such insurance, whether or not Lessee shall be in default with respect thereto, other than to forward to Owner Participant copies of all reports and other written information which Owner Trustee receives from Lessee pursuant to Section 11(e) of the Lease, or (iii) to see to the payment or discharge of any tax, assessment or other governmental charge or any lien or encumbrance of any kind owing with respect to, assessed or levied against any part of the Indenture Estate or the Trust Estate, except as provided in Section 6.01(g) of the Participation Agreement, or (iv) to inspect Lessee's books and records with respect to the Aircraft at any time permitted pursuant to the Lease. Notwithstanding the foregoing, Owner Trustee will furnish to Loan Trustee and Owner Participant, promptly upon receipt thereof, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and other instruments furnished to Owner Trustee under the Lease or any other Operative Document. SECTION 6.03. No Representations or Warranties as to Certain Matters. NEITHER OWNER TRUSTEE NOR WELLS FARGO MAKES OR SHALL BE DEEMED TO HAVE MADE (a) ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, VALUE, CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OF THE AIRCRAFT OR ANY PART THEREOF, OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE AIRCRAFT WHATSOEVER, except that Wells Fargo in its individual capacity warrants that on the Delivery Date Owner Trustee shall have received whatever title was conveyed to it by Lessee and that the Aircraft shall during the Term be free of Lessor Liens attributable to it, or (b) any representation or warranty as to the validity, legality or enforceability of this Trust Agreement or any Operative Document to which Owner Trustee is a party, or any other document or instrument, or as to the correctness of any statement contained in any thereof except to the extent that any such statement is expressly made herein or therein as a representation by Wells Fargo in its individual capacity or by Owner Trustee and except that Wells Fargo in its individual capacity hereby represents and warrants that this Trust Agreement has been, and (assuming due authorization, execution and delivery by Original Owner Participant of this Trust Agreement) the Operative Documents to which it or Owner Trustee is a party have been (or at the time of execution and delivery of any such instrument by it or Owner Trustee hereunder or pursuant to the terms of the Participation Agreement that such an instrument will be) duly executed and delivered by one of its officers who is or will be, as the case may be, duly authorized to execute and deliver such instruments on behalf of itself or Owner Trustee, as the case may be. SECTION 6.04. No Segregation of Monies Required; No Interest. Except as provided in Section 22 of the Lease, monies received by Owner Trustee hereunder need not be segregated in any manner except to the extent required by law, and may be deposited under such general conditions as may be prescribed by law, and Owner Trustee shall not be liable for any interest thereon. SECTION 6.05. Reliance Upon Certificates, Counsel and Agents. Owner Trustee shall incur no liability to anyone in acting in reliance upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. Unless other evidence in respect thereof is specifically prescribed herein, any request, direction, order or demand of Owner Participant or Lessee mentioned herein or in any of the Operative Documents to which Owner Trustee is a party shall be sufficiently evidenced by written instruments signed by a person purporting to be the chairman of the board, the president, any executive vice president, any senior vice president or any vice president or a managing director and in the name of Owner Participant or Lessee, as the case may be. Owner Trustee may accept a copy of a resolution of the Board of Directors or Executive Committee of Lessee, certified by the secretary or any assistant secretary of Lessee as duly adopted and in full force and effect, as conclusive evidence that such resolution has been duly adopted by said Board or Committee and that the same is in full force and effect. As to any fact or matter the manner of ascertainment of which is not specifically described herein, Owner Trustee may for all purposes hereof rely on a certificate signed by a person purporting to be the chairman of the board, the president, any executive vice president, any senior vice president or any vice president or a managing director of Lessee, as to such fact or matter, and such certificate shall constitute full protection to Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. In the administration of trusts hereunder, Owner Trustee may execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents or attorneys and may, at the expense of the Trust Estate, consult with counsel, accountants and other skilled persons to be selected and employed by it. Owner Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled persons and Owner Trustee shall not be liable for the negligence of any such agent, attorney, counsel, accountant or other skilled person appointed by it with due care hereunder. SECTION 6.06. Not Acting in Individual Capacity. In acting hereunder, Owner Trustee acts solely as trustee and not in its individual capacity except as otherwise expressly provided herein; and, subject to the terms of the Participation Agreement and the Indenture, all persons, other than Owner Participant, as provided herein, having any claim against Owner Trustee by reason of the transactions contemplated hereby shall look only to the Trust Estate for payment or satisfaction thereof. SECTION 6.07. Fees; Compensation. Except as provided in Section 5.03 or 7.01 hereof and Article 12 of the Participation Agreement, Owner Trustee agrees that it shall have no right against Owner Participant or (subject to the provisions of the Indenture) the Trust Estate for any fee as compensation for its services hereunder; provided, however, that Owner Trustee shall have a Lien upon the Trust Estate (subject, however, to the Lien of the Indenture) for any such fee not paid by Lessee as contemplated by the last sentence of Section 4.03(c) of the Participation Agreement. SECTION 6.08. Tax Returns. Owner Trustee shall be responsible for the keeping of all appropriate books and records relating to the receipt and disbursement of all monies under this Trust Agreement or any agreement contemplated hereby. Owner Participant shall be responsible for causing to be prepared and filed all income tax returns required to be filed by Owner Participant. Owner Trustee shall be responsible for causing to be prepared, at the request and expense of Owner Participant, all income tax returns required to be filed with respect to the trust created hereby and shall execute and file such returns. Owner Participant or Owner Trustee, as the case may be, upon request, will furnish Owner Trustee or Owner Participant, as the case may be, with all such information as may be reasonably required from Owner Participant or Owner Trustee, as the case may be, in connection with the preparation of such income tax returns. ARTICLE VII INDEMNIFICATION OF OWNER TRUSTEE BY OWNER PARTICIPANT SECTION 7.01. Owner Participant to Indemnify Owner Trustee. Owner Participant hereby agrees, whether or not any of the transactions contemplated hereby shall be consummated, to assume liability for, and hereby indemnify, protect, save and keep harmless Wells Fargo in its individual capacity and its successors, assigns, legal representatives, agents and servants, from and against any and all liabilities, obligations, losses, damages, penalties, taxes (excluding any taxes payable by Wells Fargo in its individual capacity on or measured by any compensation received by Wells Fargo in its individual capacity for its services hereunder or in connection with the transactions contemplated by the Operative Documents), claims, actions, suits, costs, expenses or disbursements (including, without limitation, reasonable ongoing fees of Owner Trustee, reasonable legal fees and expenses, and including without limitation any liability of an owner, any strict liability and any liability without fault) of any kind and nature whatsoever which may be imposed on, incurred by or asserted against Wells Fargo in its individual capacity (whether or not also indemnified against by Lessee under the Lease or under the Participation Agreement or also indemnified against by any other person but only to the extent not otherwise paid or reimbursed by Lessee or such other Person) in any way relating to or arising out of this Trust Agreement or any of the Operative Documents or the enforcement of any of the terms of any thereof, or in any way relating to or arising out of the manufacture, purchase, acceptance, nonacceptance, rejection, ownership, delivery, lease, possession, use, operation, condition, sale, return or other disposition of the Aircraft (including, without limitation, latent and other defects, whether or not discoverable, and any claim for patent, trademark or copyright infringement), or in any way relating to or arising out of the administration of the Trust Estate or the action or inaction of Owner Trustee or Wells Fargo in its individual capacity hereunder, except (a) in the case of willful misconduct or negligence on the part of Owner Trustee or Wells Fargo in its individual capacity in the performance or non-performance of its duties hereunder or (b) those resulting from the inaccuracy of any representation or warranty of Wells Fargo in its individual capacity (or from the failure of Wells Fargo in its individual capacity to perform any covenant) in Section 6.03 hereof, in Section 6.03 of the Indenture or, with respect to representations or warranties of Wells Fargo in its individual capacity only, in Section 4 of the Lease, in Section 5.03 or Section 6.01(e) of the Participation Agreement or in any of the other Operative Documents or (c) as may result from a breach by Wells Fargo in its individual capacity of its covenants in the last sentence of Section 5.04 hereof or (d) in the case of the failure to use ordinary care on the part of Owner Trustee or Wells Fargo in its individual capacity in the disbursement of funds. The indemnities contained in this Section 7.01 extend to Wells Fargo only in its individual capacity and shall not be construed as indemnities of the Indenture Estate or the Trust Estate (except to the extent, if any, that Wells Fargo in its individual capacity has been reimbursed by the Indenture Estate or the Trust Estate for amounts covered by the indemnities contained in this Section 7.01). The indemnities contained in this Section 7.01 shall survive the termination of this Trust Agreement. In addition, if necessary, Wells Fargo in its individual capacity shall be entitled to indemnification from the Trust Estate, subject to the Lien of the Indenture, for any liability, obligation, loss, damage, penalty, tax, claim, action, suit, cost, expense or disbursement indemnified against pursuant to this Section 7.01 to the extent not reimbursed by Lessee, Owner Participant or others, but without releasing any of them from their respective agreements of reimbursement; and to secure the same Wells Fargo in its individual capacity shall have a Lien on the Trust Estate, subject to the Lien of the Indenture, which shall be prior to any interest therein of Owner Participant. The payor of any indemnity under this Article VII shall be subrogated to any right of the person indemnified in respect of the matter as to which such indemnity was paid. ARTICLE VIII TRANSFER OF OWNER PARTICIPANT'S INTEREST SECTION 8.01. Transfer of Interests. All provisions of Section 6.01(n) of the Participation Agreement shall (with the same force and effect as if set forth in full, mutatis mutandis, in this Section 8.01) be applicable to any assignment, conveyance or other transfer by any Owner Participant of its right, title or interest in and to the Participation Agreement, the Trust Estate or this Trust Agreement. ARTICLE IX SUCCESSOR OWNER TRUSTEES: CO-TRUSTEES SECTION 9.01. Resignation of Owner Trustee; Appointment of Successor. (a) Resignation or Removal. Owner Trustee or any successor Owner Trustee (i) shall resign if required to do so pursuant to Section 6.01(e) of the Participation Agreement and (ii) may resign at any time without cause by giving at least sixty (60) days' prior written notice to Owner Participant, Loan Trustee (so long as the Lien of the Indenture has not been fully discharged) and Lessee (so long as the Lease is in effect), such resignation to be effective upon the acceptance of appointment by the successor Owner Trustee under Section 9.01(b) hereof. In addition, Owner Participant may at any time remove Owner Trustee without cause by a notice in writing delivered to Owner Trustee, Loan Trustee (so long as the Lien of the Indenture has not been fully discharged) and Lessee (so long as the Lease is in effect), such removal to be effective upon the acceptance of appointment by the successor Owner Trustee under Section 9.01(b) hereof. In the case of the resignation or removal of Owner Trustee, Owner Participant shall appoint a successor Owner Trustee by an instrument signed by Owner Participant. If a successor Owner Trustee shall not have been appointed within thirty (30) days after such notice of resignation or removal, Owner Trustee, Owner Participant, Lessee or Loan Trustee may apply to any court of competent jurisdiction to appoint a successor Owner Trustee to act until such time, if any, as a successor shall have been appointed as above provided. Any successor Owner Trustee so appointed by such court shall immediately and without further act be superseded by any successor Owner Trustee appointed as above provided. (b) Execution and Delivery of Documents, etc. Any successor Owner Trustee, however appointed, shall execute and deliver to the predecessor Owner Trustee and Owner Participant an instrument accepting such appointment, and thereupon such successor Owner Trustee, without further act, shall become vested with all the estates, properties, rights, powers, duties and trusts of the predecessor Owner Trustee in the trusts hereunder with like effect as if originally named Owner Trustee herein; but nevertheless, upon the written request of such successor Owner Trustee, such predecessor Owner Trustee shall execute and deliver an instrument transferring to such successor Owner Trustee, upon the trusts herein expressed, all the estates, properties, rights, powers and trusts of such predecessor Owner Trustee, and such predecessor Owner Trustee shall duly assign, transfer, deliver and pay over to such successor Owner Trustee all monies or other property then held by such predecessor Owner Trustee upon the trusts herein expressed. Upon the appointment of any successor Owner Trustee hereunder, the predecessor Owner Trustee will execute such documents as are provided to it by such successor Owner Trustee and will take such further actions as are requested of it by such successor Owner Trustee as are reasonably required to cause registration of the Aircraft included in the Trust Estate to be transferred upon the records of the FAA, or other governmental authority having jurisdiction, into the name of the successor Owner Trustee. (c) Qualification. Any successor Owner Trustee, however appointed, shall be a Citizen of the United States without making use of a voting trust, voting powers agreement or similar arrangement and shall also be a bank or trust company organized under the laws of the United States or any state thereof having a combined capital and surplus of at least $100,000,000, if there be such an institution willing, able and legally qualified to perform the duties of Owner Trustee hereunder upon reasonable or customary terms. (d) Merger, etc. Any corporation into which Owner Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which Owner Trustee shall be a party, or any corporation to which substantially all the corporate trust business of Owner Trustee may be transferred, shall, subject to the terms of Section 9.01(c) hereof, be Owner Trustee hereunder without further act. SECTION 9.02. Co-Trustees and Separate Trustees. If at any time it shall be necessary or prudent in order to conform to any law of any jurisdiction in which all or any part of the Trust Estate is located, or Owner Trustee being advised by counsel shall determine that it is so necessary or prudent in the interest of Owner Participant or Owner Trustee, or Owner Trustee shall have been directed to do so by Owner Participant, Owner Trustee and Owner Participant shall execute and deliver an agreement supplemental hereto and all other instruments and agreements necessary or proper to constitute another bank or trust company or one or more persons (any and all of which shall be a Citizen of the United States without making use of a voting trust, voting powers agreement or similar arrangement) approved by Owner Trustee and Owner Participant, either to act as co-trustee, jointly with Owner Trustee, or to act as separate trustee hereunder (any such co-trustee or separate trustee being herein sometimes referred to as an "additional trustee"). In the event an Indenture Event of Default not arising from a Lease Event of Default shall occur and be continuing, Owner Trustee may act under the foregoing provisions of this Section 9.02 without the concurrence of Owner Participant; and Owner Participant hereby appoints Owner Trustee its agent and attorney-in-fact to act for it under the foregoing provisions of this Section 9.02 in such contingency. Every additional trustee hereunder shall, to the extent permitted by law, be appointed and act, and Owner Trustee and its successors shall act, subject to the following provisions and conditions: (A) all powers, duties, obligations and rights conferred upon Owner Trustee in respect of the custody, control and management of monies, the Aircraft or documents authorized to be delivered hereunder or under the Participation Agreement shall be exercised solely by Owner Trustee; (B) all other rights, powers, duties and obligations conferred or imposed upon Owner Trustee shall be conferred or imposed upon and exercised or performed by Owner Trustee and such additional trustee jointly, except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed (including the holding of title to the Trust Estate) Owner Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations shall be exercised and performed by such additional trustee; (C) no power given to, or which it is provided hereby may be exercised by, any such additional trustee shall be exercised hereunder by such additional trustee, except jointly with, or with the consent in writing of, Owner Trustee; (D) no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; (E) Owner Participant, at any time, by an instrument in writing may remove any such additional trustee unless such additional trustee was appointed by Owner Trustee without the concurrence of Owner Participant during the occurrence of an Indenture Event of Default not arising from a Lease Event of Default, in which case Owner Trustee shall have the power to remove any such additional trustee without the concurrence of Owner Participant; and Owner Participant hereby appoints Owner Trustee its agent and attorney-in-fact for it in such connection in such contingency; and (F) no appointment of, or action by, any additional trustee will relieve Owner Trustee of any of its obligations under, or otherwise affect any of the terms of, the Indenture or affect the interests of Loan Trustee or the holders of the Equipment Notes in the Indenture Estate. ARTICLE X SUPPLEMENTS AND AMENDMENTS TO TRUST AGREEMENT AND OTHER DOCUMENTS SECTION 10.01. Supplements and Amendments. (a) Supplements and Amendments. This Trust Agreement may not be amended, supplemented or otherwise modified except by an instrument in writing signed by Owner Trustee and Owner Participant. Subject to Section 10.02 hereof and the first sentence of Section 6.01(m) of the Participation Agreement, Owner Trustee will execute any amendment, supplement or other modification of this Trust Agreement or of any other Operative Document to which Owner Trustee is a party which it is requested to execute by Owner Participant, except that Owner Trustee shall not execute any such amendment, supplement or other modification which, by the express provisions of any of the above documents, requires the consent of any other party unless such consent shall have been obtained. (b) Delivery of Amendments and Supplements to Certain Parties. A signed copy of each amendment or supplement referred to in Section 10.01(a) hereof shall be delivered by Owner Trustee to Loan Trustee and each holder of an Equipment Note. SECTION 10.02. Discretion as to Execution of Documents. Prior to executing any document required to be executed by it pursuant to the terms of Section 10.01 hereof, Owner Trustee shall be entitled to receive an opinion of its counsel to the effect that the execution of such document is authorized hereunder. If in the opinion of Owner Trustee any such document adversely affects any right, duty, immunity or indemnity in favor of Owner Trustee hereunder or under any other Operative Document to which Owner Trustee is a party, Owner Trustee may in its discretion decline to execute such document. SECTION 10.03. Absence of Requirements as to Form. It shall not be necessary for any written request furnished pursuant to Section 10.01 hereof to specify the particular form of the proposed documents to be executed pursuant to such Section, but it shall be sufficient if such request shall indicate the substance thereof. SECTION 10.04. Distribution of Documents. Promptly after the execution by Owner Trustee of any document entered into pursuant to Section 10.01 hereof, Owner Trustee shall mail, by certified mail, postage prepaid, a conformed copy thereof to Owner Participant, but the failure of Owner Trustee to mail such conformed copy shall not impair or affect the validity of such document. SECTION 10.05. No Request Needed as to Lease Supplement and Indenture Supplement. No written request pursuant to Section 10.01 hereof shall be required to enable Owner Trustee to enter into the Lease Supplement covering the Aircraft with Lessee pursuant to the terms of the Lease and Section 3.01 hereof and the Indenture Supplement pursuant to the terms of the Indenture and Section 3.01 hereof. ARTICLE XI MISCELLANEOUS SECTION 11.01. Termination of Trust Agreement. This Trust Agreement and the trusts created hereby shall be of no further force or effect upon the earlier of (a) both the final discharge of the Indenture pursuant to Section 10.01 thereof and the sale or other final disposition by Owner Trustee of all property constituting part of the Trust Estate and the final distribution by Owner Trustee of all monies or other property or proceeds constituting part of the Trust Estate in accordance with Article IV hereof, provided that at such time Lessee shall have fully complied with all of the terms of the Lease and the Participation Agreement or (b) twenty-one years less one day after the death of the last survivor of all of the descendants of the grandparents of David Rockefeller living on the date of the earliest execution of this Trust Agreement by any party hereto; otherwise this Trust Agreement and the trusts created hereby shall continue in full force and effect in accordance with the terms hereof. SECTION 11.02. Owner Participant Has No Legal Title in Trust Estate. Owner Participant shall not have legal title to any part of the Trust Estate. No transfer, by operation of law or otherwise, of any right, title and interest of Owner Participant in and to the Trust Estate hereunder shall operate to terminate this Trust Agreement or the trusts hereunder or entitle any successors or transferees of Owner Participant to an accounting or to the transfer of legal title to any part of the Trust Estate. SECTION 11.03. Assignment, Sale, etc. of Aircraft. Any assignment, sale, transfer or other conveyance of its interest in the Aircraft by Owner Trustee made pursuant to the terms hereof or of the Lease or the Participation Agreement shall bind Owner Participant and shall be effective to transfer or convey all right, title and interest of Owner Trustee and Owner Participant in and to the Aircraft. No purchaser or other grantee shall be required to inquire as to the authorization, necessity, expediency or regularity of such assignment, sale, transfer or conveyance or as to the application of any sale or other proceeds with respect thereto by Owner Trustee. SECTION 11.04. Trust Agreement for Benefit of Certain Parties Only. Except for the terms of Section 5.02(i) of the Participation Agreement incorporated in Article VIII hereof and except as otherwise provided in Articles IX and X hereof, nothing herein, whether expressed or implied, shall be construed to give any Person other than Owner Trustee and Owner Participant any legal or equitable right, remedy or claim under or in respect of this Trust Agreement; but this Trust Agreement shall be held to be for the sole and exclusive benefit of Owner Trustee and Owner Participant. SECTION 11.05. Notices; Consent to Jurisdiction. (a) All notices, demands, instructions and other communications required or permitted to be given to or made upon any party hereto shall be in writing and shall be personally delivered or sent by registered or certified mail, postage prepaid, or by telecopier, or by prepaid courier service, and shall be deemed to be given for purposes of this Trust Agreement on the day that such writing is delivered or sent to the intended recipient thereof in accordance with the provisions of this Section 11.05(a). Unless otherwise specified in a notice sent or delivered in accordance with the foregoing provisions of this Section 11.05(a), notices, demands, instructions and other communications in writing shall be given to or made upon the respective parties hereto at their respective addresses (or to their respective telecopier numbers) as follows: (A) if to Lessee, Owner Trustee, Noteholders, Loan Trustee or Owner Participant, to the respective addresses set forth in Section 16.01 of the Participation Agreement, or (B) if to a Subsequent Owner Participant, addressed to such Subsequent Owner Participant at such address as such Subsequent Owner Participant shall have furnished by notice to the parties hereto or (C) if to any subsequent Noteholder, addressed to such Noteholder at its address set forth in the equipment note register maintained pursuant to Section 2.07 of the Indenture. (b) Each of the parties hereto (A) hereby irrevocably submits itself to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York and to the non-exclusive jurisdiction of the Supreme Court of the State of New York, New York County, for the purposes of any suit, action or other proceeding arising out of this Trust Agreement, the Participation Agreement, the Lease, the Tax Indemnity Agreement or any other Operative Document, the subject matter of any thereof or any of the transactions contemplated hereby or thereby brought by any party or parties thereto, or their successors or assigns, and (B) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, to the extent permitted by applicable law, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper, or that the Participation Agreement, the Lease, the Tax Indemnity Agreement or any other Operative Document or the subject matter of any thereof or any of the transactions contemplated hereby or thereby may not be enforced in or by such courts. SECTION 11.06. Severability. Any provision hereof which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. SECTION 11.07. Waivers, etc. No term or provision hereof may be changed, waived, discharged or terminated orally, but only by an instrument in writing entered into in compliance with the terms of Article X hereof; and any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given. SECTION 11.08. Counterparts. This Trust 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 instrument. SECTION 11.09. Binding Effect, etc. All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, Owner Trustee and its successors and assigns, and Owner Participant, its successors and, to the extent permitted by Article VIII hereof, its assigns. Any request, notice, direction, consent, waiver or other instrument or action by Owner Participant shall bind its successors and assigns. Any Owner Participant which shall cease to have any Ownership Interest shall thereupon cease to be a party hereto or an Owner Participant for any reason and shall have no further obligations hereunder. SECTION 11.10. Headings; References. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. SECTION 11.11. GOVERNING LAW. THIS TRUST AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF UTAH, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. SECTION 11.12. No Bankruptcy or Insolvency Proceedings. The trust created by this Trust Agreement is not intended to be a business trust within the meaning of Section 101(9)(A)(v) of the Bankruptcy Code. Owner Trustee shall not have the power to (i) institute proceedings to have the trust created by this Trust Agreement declared or adjudicated a bankrupt or insolvent, (ii) consent to the institution of bankruptcy or insolvency proceedings against the trust created by this Trust Agreement, (iii) file a petition or consent to a petition seeking reorganization or relief on behalf of the trust created by this Trust Agreement under any applicable federal or state law relating to bankruptcy, (iv) consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or any similar official) of the trust created by this Trust Agreement or a substantial portion of the assets of the trust created by this Trust Agreement, (v) make any assignment for the benefit of the creditors of the trust created by this Trust Agreement, (vi) cause the trust created by this Trust Agreement to admit in writing its inability to pay its debts generally as they become due, or (vii) take any action, or cause the trust created by this Trust Agreement to take any action, in furtherance of any of the foregoing. Wells Fargo, by entering into this Trust Agreement, hereby covenants and agrees that it will not at any time institute against the trust created by this Trust Agreement, or join in any institution against the trust created by this Trust Agreement of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or insolvency law in connection with any obligations relating to this Trust Agreement or any of the other Operative Documents. IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to be duly executed by their respective officers thereunto duly authorized as of the day and year first above written. [___________________________] By: ___________________________________ Name: Title: WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION By: ___________________________________ Name: Title: EXHIBIT L TO PARTICIPATION AGREEMENT MANDATORY DOCUMENT TERMS 1. May not modify in any material adverse respect as regards the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee, the Granting Clause of the Indenture Form so as to deprive Noteholders of a first priority security interest in and mortgage lien on the Aircraft and the Lease or to eliminate any of the obligations intended to be secured thereby or otherwise modify in any material adverse respect as regards the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee the provisions of Article II or III or Sections 4.02, 4.03, 4.04, 5.02, 5.06, 9.01 or Section 10.14 of the Indenture Form. 2. May not modify in any material adverse respect as regards the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee the provisions of Section 3(c)(iv), Section 3(e), Section 7(e), clause (G) of the fourth paragraph of Section 10(a), Section 16, Section 18, the first and third sentences of Section 20 or the penultimate sentence of Section 24 of the Lease Form or otherwise modify the terms of the Lease Form so as to deprive Loan Trustee of rights expressly granted to the "Loan Trustee" therein. 3. May not modify in any material adverse respect as regards the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee the provisions of Sections 3.01(g)(iii)(A), 3.01(g)(iii)(B), 3.01(g)(iii)(C), Sections 6.01(h), 5.04(c), 6.02(b), 7.01, 16.03 or 16.13 or the provisions of Sections 3.01(h), 3.01(i), 3.01(j), 3.01(k), 3.01(l), 3.01(m), 3.01(n) and the paragraph following Section 3.01(bb) of the Participation Agreement Form so as to eliminate the requirement to deliver to Pass Through Trustees or Loan Trustee, as the case may be, the legal opinions to be provided to such Person thereunder (recognizing that the lawyers rendering such opinions may be changed) or the provisions of Section 6.01(f)(i)(B) or otherwise modify the terms of the Participation Agreement Form to deprive Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee of any indemnity or right of reimbursement in its favor for Claims or Taxes. 4. May not modify the definition of "Make-Whole Amount" in Annex A to the Indenture Form in any material adverse respect as regards the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider or Loan Trustee. Notwithstanding the foregoing, any such Mandatory Document Term may be modified to correct or supplement any such provision which may be defective or to cure any ambiguity or correct any mistake, provided, however, that any such modification shall not materially adversely affect the interests of Noteholders, Subordination Agent, Liquidity Provider, Policy Provider, Loan Trustee or the holders of the Pass Through Certificates. EXHIBIT M TO PARTICIPATION AGREEMENT MANDATORY ECONOMIC TERMS o The principal amount of the new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes, respectively, to be issued by the owner trustee will be equal to the outstanding principal balance of the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes at the time of the Sale/Leaseback Transaction. o The loan to Aircraft value ratio with respect to the Aircraft (computed on the basis of an assumed value for the Aircraft no greater than the value for the Aircraft set forth under "Summary -- Equipment Notes and the aircraft" under the column "Appraised base value" in the "Prospectus Supplement" (as such term is defined in the Underwriting Agreement) and the "Depreciation Assumption" (as such term is defined in the Prospectus Supplement)) at the time of the issuance of the new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes in connection with the Sale/Leaseback Transaction and on any Regular Distribution Date (as such term is defined in the Intercreditor Agreement) thereafter, calculated as set forth in "Description of the equipment notes -- Loan to value ratios of equipment notes," in the Prospectus Supplement will not exceed the following amounts: Loan to Aircraft Value Ratio ---------------------------- new Series G-1 new Series G-2 new Series C equipment notes equipment notes equipment notes --------------- --------------- --------------- 65.0% 59.8% 72.4% o As of May 1, 2003, the average life of each class of Pass Through Certificates (computed without regard to the acceleration of any "Equipment Notes" (as such term is defined the Intercreditor Agreement)) shall not be less than the minimum nor more than the maximum years from April 30, 2002 set forth in the following table: Pass Through Pass Through Pass Through Certificates Certificates Certificates issued by the issued by the issued by the Class G-1 Pass Class G-2 Pass Class C Pass Through Trust Through Trust Through Trust -------------- -------------- -------------- Minimum 10.2 years 10.2 years 5.3 years Maximum 10.5 years 10.2 years 5.5 years o As of May 1, 2003, the average life of the Series G-1 Equipment Notes, the Series G-2 Equipment Notes and the Series C Equipment Notes (including any new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes to be issued by the owner trustee in connection with a Sale/Leaseback Transaction) (computed without regard to any acceleration of Equipment Notes) shall be not less than the minimum nor more than the maximum years from April 30, 2002 set forth in the following table; provided, however, that if any new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes are issued by the owner trustee after April 30, 2003 in connection with a Sale/Leaseback Transaction, the average life of such new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes must correspond to the average life of the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes, respectively, being assumed by the owner trustee: Series G-1 Series G-2 Series C Equipment Notes Equipment Notes Equipment Notes --------------- --------------- --------------- Minimum 8.5 years 10.2 years 4.0 years Maximum 13.5 years 10.2 years 7.0 years o The final maturity date of the new Series G-1 equipment notes and the new Series C equipment notes to be issued by the owner trustee in a Sale/Leaseback Transaction will not extend beyond January 2, 2023 and January 2, 2012, respectively. o The final maturity date of the new Series G-2 equipment notes to be issued by the owner trustee in a Sale/Leaseback Transaction shall be July 2, 2012 and there shall be no scheduled amortization of such new Series G-2 equipment notes. o The interest rate applicable to the new Series G-1 equipment notes shall be 6.718% per annum, the interest rate applicable to the new Series G-2 equipment notes shall be 6.417% per annum and the interest rate applicable to the new Series C equipment notes shall be 7.779% per annum. o The payment dates for the new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes to be issued by the owner trustee in connection with a Sale/Leaseback Transaction and for basic rent under the lease agreement to be entered into in connection therewith must be January 2 and July 2, provided that, at Company's election, basic rent may also be paid at the commencement of such lease agreement. o Basic rent (and supplemental rent), Stipulated Loss Values and termination values under the lease agreement to be entered into in connection with a Sale/Leaseback Transaction must be sufficient to pay amounts due with respect to the new Series G-1 equipment notes, Series G-2 equipment notes and Series C equipment notes to be issued by the owner trustee in connection with such Sale/Leaseback Transaction. o The amounts payable under the all-risk hull insurance maintained with respect to the Aircraft must be sufficient to pay the applicable Stipulated Loss Value. o (a) The past due rate in the amended and restated indenture and the lease agreement, (b) the Make-Whole Amount payable under the amended and restated indenture, (c) the provisions relating to the redemption and purchase of the new equipment notes in the amended and restated indenture and (d) the indemnification of Loan Trustee, Subordination Agent, Liquidity Provider, Policy Provider, Pass Through Trustees and the registered holders of the new equipment notes with respect to certain taxes and expenses, in each case must be no less favorable to Loan Trustee, Subordination Agent, Liquidity Provider, Policy Provider, Pass Through Trustees and the registered holders of the new equipment notes than as set forth in the Participation Agreement Form, the Lease Form and the Indenture Form. EXHIBIT N TO PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR POLICY PROVIDER [Intentionally Omitted] Annex A to Participation Agreement and Indenture and Security Agreement (N372DA) DEFINITIONS (N372DA) "Additional Insureds" has the meaning specified in Section 7.06(a) of the Indenture. "After-Tax Basis" means that indemnity and compensation payments required to be made on such basis will be supplemented by the Person paying the base amount by that amount which, when added to such base amount, and after deduction of all Federal, state, local and foreign Taxes required to be paid by or on behalf of the payee with respect of the receipt or realization of any such amounts, and after consideration of any current tax savings of such payee resulting by way of any deduction, credit or other tax benefit attributable to such base amount or Tax, shall net such payee the full amount of such base amount. "Agreement" and "Participation Agreement" mean that certain Participation Agreement (N372DA), dated as of April 30, 2002, among Company, State Street, Pass Through Trustee under each Pass Through Trust Agreement, Subordination Agent and Loan Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its Terms. "Aircraft" means the Airframe (or any Replacement Airframe substituted therefor pursuant to Section 7.05 of the Indenture) together with the two Engines described in the Indenture Supplement originally executed and delivered under the Indenture (or any Replacement Engine that may from time to time be substituted for any of such Engines pursuant to Section 7.04 or Section 7.05 of the Indenture), whether or not any of such initial or substituted Engines is from time to time installed on such Airframe or installed on any other airframe or on any other aircraft. The term "Aircraft" includes any Replacement Aircraft. "Airframe" means (a) the Boeing 737-832 aircraft (except (i) the Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (ii) items installed or incorporated in or attached to such Boeing 737-832 aircraft from time to time that are excluded from the definition of Parts (except Engines or engines)) specified in the Indenture Supplement originally executed and delivered under the Indenture and (b) any and all related Parts. The term "Airframe" includes any Replacement Airframe that is substituted for the Airframe pursuant to Section 7.05 of the Indenture. At such time as any Replacement Airframe is so substituted and the Airframe for which such substitution is made is released from the Lien of the Indenture, such replaced Airframe shall cease to be an Airframe under the Indenture. "Bankruptcy Code" means the United States Bankruptcy Code, 11 United States Code ss.ss.101 et seq., as amended, or any successor statutes thereto. "Basic Pass Through Trust Agreement" means that certain Pass Through Trust Agreement, dated as of November 16, 2000, between Company and State Street, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms (but does not include any Trust Supplement). "Bills of Sale" means the FAA Bill of Sale and the Warranty Bill of Sale. "Business Day" means any day other than a Saturday, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia or the city and state in which Loan Trustee maintains its Corporate Trust Office or receives and disburses funds. "Certificated Air Carrier" means a Citizen of the United States holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the United States Code for aircraft capable of carrying ten or more individuals or 6,000 pounds or more of cargo or that otherwise is certified or registered to the extent required to fall within the purview of Section 1110. "Citizen of the United States" has the meaning specified for such term in Section 40102(a)(15) of Title 49 of the United States Code or any similar legislation of the United States enacted in substitution or replacement therefor. "Claim" has the meaning specified in Section 4.02(a) of the Participation Agreement. "Class C Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1C created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1C, dated as of April 30, 2002 between Company and State Street. "Class G-1 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-1 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Company and State Street. "Class G-1 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Company and State Street. "Class G-2 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-2 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Company and State Street. "Class G-2 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Company and State Street. "Closing" has the meaning specified in Section 2.03 of the Participation Agreement. "Closing Date" means the date of the closing of the transaction contemplated by the Operative Documents. "Code" means the Internal Revenue Code of 1986, as amended. "Collateral" has the meaning specified in the granting clause of the Indenture. "Company" means Delta Air Lines, Inc., and its successors and permitted assigns. "Compulsory Acquisition" means requisition of title or other compulsory acquisition, capture, seizure, deprivation, confiscation or detention for any reason of the Aircraft by any government that results in the loss of title or use of the Aircraft by Company (or any Permitted Lessee) for a period in excess of 180 days, but shall exclude requisition for use or hire not involving requisition of title. "Confidential Information" has the meaning specified in Section 10.16 of the Indenture. "Controlling Party" has the meaning specified in Section 2.06 of the Intercreditor Agreement. "Corporate Trust Office" means the Corporate Trust Division of Loan Trustee located at State Street Bank and Trust Company of Connecticut, National Association, 225 Asylum Street, Goodwin Square, Hartford, Connecticut, 06103, Attention: Corporate Trust Division, or such other office at which Loan Trustee's corporate trust business is administered that Loan Trustee specifies by notice to Company. "CRAF Program" means the Civil Reserve Air Fleet Program authorized under 10 U.S.C. Section 9511 et seq. or any similar or substitute program under the laws of the United States. "Debt Rate" means, with respect to any Series, the rate per annum specified for such Series under the heading "Interest Rate" in Schedule I to the Indenture. "Department of Transportation" means the United States Department of Transportation and any agency or instrumentality of the United States government succeeding to its functions. "Direction" has the meaning specified in Section 2.16 of the Indenture. "Dollars" and "$" mean the lawful currency of the United States. "Engine" means (a) each of the two CFM International, Inc. CFM56-7B26 engines, which may be rated at or limited to -24 or higher power, listed by manufacturer's serial number in the Indenture Supplement originally executed and delivered under the Indenture, whether or not from time to time installed on the Airframe or installed on any other airframe or on any other aircraft and (b) any Replacement Engine substituted for an Engine pursuant to Section 7.04 or 7.05 of the Indenture; together in each case with any and all related Parts. At such time as a Replacement Engine is so substituted and the Engine for which substitution is made is released from the Lien of the Indenture, such replaced Engine shall cease to be an Engine under the Indenture. "Equipment Note" means and includes any Equipment Note originally issued pursuant to Section 2.02 of the Indenture and any Equipment Note issued in exchange therefor or replacement thereof pursuant to Section 2.07 or 2.08 of the Indenture. "Equipment Note Register" has the meaning specified in Section 2.07 of the Indenture. "Equipment Note Registrar" has the meaning specified in Section 2.07 of the Indenture. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA as in effect at the date of the Participation Agreement and any subsequent provisions of ERISA amendatory thereof, supplemental thereto or substituted therefor. "Event of Default" has the meaning specified in Section 4.01 of the Indenture. "Event of Loss" means, with respect to the Aircraft, Airframe or any Engine, any of the following events with respect to such property: (a) the loss of such property or of the use thereof due to destruction, damage beyond repair or rendition of such property permanently unfit for normal use for any reason whatsoever; (b) any damage to such property which results in an insurance settlement with respect to such property on the basis of a total loss, a compromised total loss or a constructive total loss; (c) the theft or disappearance of such property for a period in excess of 180 days; (d) the requisition for use of such property by any government (other than a requisition for use by a Government or the government of the country of registry of the Aircraft) that results in the loss of possession of such property by Company (or any Permitted Lessee) for a period in excess of 12 consecutive months; (e) the operation or location of the Aircraft, while under requisition for use by any government, in any area excluded from coverage by any insurance policy in effect with respect to the Aircraft required by the terms of Section 7.06 of the Indenture, unless Company shall have obtained indemnity or insurance in lieu thereof from such government; (f) any Compulsory Acquisition; (g) as a result of any law, rule, regulation, order or other action by the FAA or other government of the country of registry, the use of the Aircraft or Airframe in the normal business of air transportation is prohibited by virtue of a condition affecting all aircraft of the same type for a period of 18 consecutive months, unless Company is diligently carrying forward all steps that are necessary or desirable to permit the normal use of the Aircraft or Airframe or, in any event, if such use is prohibited for a period of three consecutive years; and (h) with respect to an Engine only, any divestiture of title to or interest in an Engine or any event with respect to an Engine that is deemed to be an Event of Loss with respect to such Engine pursuant to Section 7.02(a)(vii) of the Indenture. An Event of Loss with respect to the Aircraft shall be deemed to have occurred if an Event of Loss occurs with respect to the Airframe unless Company elects to substitute a Replacement Airframe pursuant to Section 7.05(a)(i) of the Indenture. "FAA" means the United States Federal Aviation Administration and any agency or instrumentality of the United States government succeeding to its functions. "FAA Bill of Sale" means the bill of sale for the Aircraft on AC Form 8050-2 executed by Manufacturer or an affiliate of Manufacturer in favor of Company and recorded with the FAA. "Federal Funds Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 State Street from three Federal funds brokers of recognized standing selected by it. "Government" means the government of any of Canada, France, Germany, Japan, The Netherlands, Sweden, Switzerland, the United Kingdom or the United States and any instrumentality or agency thereof. "Indemnitee" has the meaning specified in Section 4.02(b) of the Participation Agreement. "Indenture" means that certain Indenture and Security Agreement (N372DA), dated as of April 30, 2002, between Company and Loan Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, including supplementing by an Indenture Supplement pursuant to the Indenture. "Indenture Form" means the form of Amended and Restated Indenture and Security Agreement attached as Exhibit I to the Participation Agreement. "Indenture Indemnitee" means (i) Loan Trustee, (ii) State Street, (iii) so long as it holds any Equipment Note as agent and trustee of any Pass Through Trustee, Subordination Agent, (iv) Liquidity Provider and Policy Provider and (v) so long as it is the holder of any Equipment Notes, each Pass Through Trustee and each of their respective directors, officers, employees, agents and servants. No holder of a Pass Through Certificate in its capacity as such shall be an Indenture Indemnitee. "Indenture Supplement" means a supplement to the Indenture, substantially in the form of Exhibit A to the Indenture, which particularly describes the Aircraft, and any Replacement Airframe and or Replacement Engine included in the property subject to the Lien of the Indenture. "Intercreditor Agreement" means that certain Intercreditor Agreement, dated as of the Closing Date, among Pass Through Trustees, Liquidity Provider, Policy Provider and Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interests" has the meaning specified in Section 7.06(a) of the Indenture. "Lease" means any lease permitted by the terms of Section 7.02(a) of the Indenture. "Lease Form" means the form of Lease Agreement attached as Exhibit H to the Participation Agreement. "Lien" means any mortgage, pledge, lien, encumbrance, lease, sublease, sub-sublease or security interest. "Liquidity Facilities" means the three Revolving Credit Agreements, each dated as of the Closing Date, between Subordination Agent, as borrower, and Liquidity Provider, and any replacements thereof, in each case as the same may be amended or supplemented or otherwise modified from time to time in accordance with its terms. "Liquidity Provider" means Westdeutsche Landesbank Girozentrale, a German banking institution organized under the laws of the State of North Rhine-Westphalia, acting through its New York branch, as liquidity provider under each of the Liquidity Facilities, or any liquidity provider under a replacement liquidity facility. "Loan Amount" has the meaning specified in Section 7.06(b) of the Indenture. "Loan Trustee" has the meaning specified in the introductory paragraph of the Indenture. "Loan Trustee Liens" means any Lien attributable to State Street or Loan Trustee with respect to the Aircraft, any interest therein or any other portion of the Collateral arising as a result of (i) claims against State Street or Loan Trustee not related to its interest in the Aircraft or the administration of the Collateral pursuant to the Indenture, (ii) acts of State Street or Loan Trustee not permitted by, or the failure of State Street or Loan Trustee to take any action required by the Operative Documents or the Pass Through Documents, (iii) claims against State Street or Loan Trustee relating to Taxes or Claims that are excluded from the indemnification provided by Section 4.02 of the Participation Agreement pursuant to said Section 4.02 or (iv) claims against State Street or Loan Trustee arising out of the transfer by any such party of all or any portion of its interest in the Aircraft, the Collateral, the Operative Documents or the Pass Through Documents, except while an Event of Default is continuing and prior to the time that Loan Trustee has received all amounts due to it pursuant to the Indenture. "Loss Payment Date" has the meaning specified in Section 7.05(a) of the Indenture. "Majority in Interest of Noteholders" means, as of a particular date of determination and subject to Section 2.16 of the Indenture, the holders of at least a majority in aggregate unpaid principal amount of all Equipment Notes outstanding as of such date (excluding any Equipment Notes held by Company or any affiliate thereof. "Make-Whole Amount" means, with respect to any Equipment Note, the amount (as determined by an independent investment banker selected by Company (and, following the occurrence and during the continuance of an Event of Default, reasonably acceptable to Loan Trustee)), if any, by which (i) the present value of the remaining scheduled payments of principal and interest from the redemption date to maturity of such Equipment Note computed by discounting each such payment on a semiannual basis from its respective Payment Date (assuming a 360-day year of twelve 30 day months) using a discount rate equal to the Treasury Yield exceeds (ii) the outstanding principal amount of such Equipment Note plus accrued but unpaid interest thereon. For purposes of determining the Make-Whole Amount, "Treasury Yield" means, at the date of determination, the interest rate (expressed as a semiannual equivalent and as a decimal and, in the case of United States Treasury bills, converted to a bond equivalent yield) determined to be the per annum rate equal to the semiannual yield to maturity for United States Treasury securities maturing on the Average Life Date and trading in the public securities market either as determined by interpolation between the most recent weekly average yield to maturity for two series of United States Treasury securities, trading in the public securities markets, (A) one maturing as close as possible to, but earlier than, the Average Life Date and (B) the other maturing as close as possible to, but later than, the Average Life Date, in each case as published in the most recent H.15(519) or, if a weekly average yield to maturity for United States Treasury securities maturing on the Average Life Date is reported on the most recent H.15(519), such weekly average yield to maturity as published in such H.15(519). "H.15(519)" means the weekly statistical release designated as such, or any successor publication, published by the Board of Governors of the Federal Reserve System. The date of determination of a Make-Whole Amount shall be the third Business Day prior to the applicable redemption date and the "most recent H.15(519)" means the H.15(519) published prior to the close of business on the third Business Day prior to the applicable redemption date. "Average Life Date" means, for each Equipment Note to be redeemed, the date which follows the redemption date by a period equal to the Remaining Weighted Average Life at the redemption date of such Equipment Note. "Remaining Weighted Average Life" of an Equipment Note, at the redemption date of such Equipment Note, means the number of days equal to the quotient obtained by dividing: (i) the sum of the products obtained by multiplying (A) the amount of each then remaining installment of principal, including the payment due on the maturity date of such Equipment Note, by (B) the number of days from and including the redemption date to but excluding the scheduled payment date of such principal installment by (ii) the then unpaid principal amount of such Equipment Note. "Mandatory Document Terms" has the meaning specified for such term in Exhibit L to the Participation Agreement. "Mandatory Economic Terms" has the meaning specified for such term in Exhibit M to the Participation Agreement. "Manufacturer" means The Boeing Company, a Delaware corporation, and its successors and assigns. "Manufacturer's Consent" means the Manufacturer's Consent and Agreement to Assignment of Warranties, dated as of the Closing Date, substantially in the form of Exhibit E to the Participation Agreement "Noteholder" means any Person in whose name an Equipment Note is registered on the Equipment Note Register (including, for so long as it is the registered holder of any Equipment Notes, Subordination Agent on behalf of Pass Through Trustees pursuant to the provisions of the Intercreditor Agreement). "Noteholder Liens" means any Lien attributable to any Noteholder on or against the Aircraft, any interest herein or any portion of the Collateral, arising out of any claim against such Noteholder that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such Noteholder that is not related to the transactions contemplated by, or that constitutes a breach by such Noteholder of its obligations under, the Operative Documents or the Pass Through Documents. "Operative Documents" means, collectively, the Participation Agreement, the Indenture, each Indenture Supplement, the Manufacturer's Consent and the Equipment Notes. "Other Party Liens" means any Lien attributable to Pass Through Trustee (other than in its capacity as Noteholder), Subordination Agent (other than in its capacity as Noteholder), Liquidity Provider or Policy Provider on or against the Aircraft, any interest therein, or any portion of the Collateral arising out of any claim against such party that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such party that is not related to the transactions contemplated by, or that constitutes a breach by such party of its obligations under, the Operative Documents or the Pass Through Documents. "Participation Agreement" has the meaning set forth under the definition of "Agreement". "Participation Agreement Form" means the form of Amended and Restated Participation Agreement attached as Exhibit G to the Participation Agreement. "Parts" means any and all appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment of whatever nature (other than (a) complete Engines or engines, (b) any items leased by Company or any Permitted Lessee, (c) cargo containers, (d) components or systems installed on or affixed to the Airframe that are used to provide individual telecommunications or electronic entertainment to passengers aboard the Aircraft, (e) medical and similar emergency equipment and (f) passenger service items and equipment generally used in but not affixed to the Aircraft, such as blankets, coffee pots, beverage and meal servicing carts, etc.), so long as the same are incorporated or installed in or attached to the Airframe or any Engine or so long as the same are subject to the Lien of the Indenture in accordance with the terms of Section 7.04 thereof after removal from the Airframe or any Engine. "Pass Through Certificates" means the pass through certificates issued by Pass Through Trustees. "Pass Through Documents" means the Pass Through Trust Agreements, the Intercreditor Agreement, the Liquidity Facilities and the Policy Provider Agreement. "Pass Through Trust" means each of the three separate grantor trusts created pursuant to the Pass Through Trust Agreements to facilitate certain of the transactions contemplated by the Operative Documents. "Pass Through Trust Agreement" means each of the three separate Trust Supplements together in each case with the Basic Pass Through Trust Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Pass Through Trustee" has the meaning specified in the introductory paragraph to the Participation Agreement. "Pass Through Trustees" means, collectively, Pass Through Trustees under each Pass Through Trust Agreement. "Past Due Rate" means, with respect to a particular Series, a rate per annum equal to the applicable Debt Rate plus 1% and, in any case other than with respect to a particular Series, the Debt Rate for the Series G-2 Equipment Notes plus 1%. "Payment Date" means, for any Equipment Note, each July 2 and January 2, commencing with January 2, 2003. "Payment Default" means the occurrence of an event that would give rise to an Event of Default under Section 4.01(a) of the Indenture upon the giving of notice or the passing of time or both. "Permitted Investments" means each of (a) direct obligations of the United States and agencies thereof; (b) obligations fully guaranteed by the United States; (c) certificates of deposit issued by, or bankers' acceptances of, or time deposits with, any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. ("S&P") (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (d) commercial paper of any holding company of a bank, trust company or national banking association described in clause (c); (e) commercial paper of companies having a rating assigned to such commercial paper by either Moody's or S&P (or, if neither such organization then rates such commercial paper, by any nationally recognized rating organization in the United States) equal to either of the two highest ratings assigned by such organization; (f) Dollar-denominated certificates of deposit issued by, or time deposits with, the European subsidiaries of (i) any bank, trust company or national banking association described in clause (c), or (ii) any other bank or financial institution described in clause (h) or (i) below; (g) United States-issued Yankee certificates of deposit issued by, or bankers' acceptances of, or commercial paper issued by, any bank having combined capital and surplus and retained earnings of at least $100,000,000 and headquartered in Canada, Japan, the United Kingdom, France, Germany, Switzerland or The Netherlands and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (h) Dollar-denominated time deposits with any Canadian bank having a combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (i) Canadian Treasury Bills fully hedged to Dollars; (j) repurchase agreements with any financial institution having combined capital and surplus and retained earnings of at least $100,000,000 collateralized by transfer of possession of any of the obligations described in clauses (a) through (i) above; (k) bonds, notes or other obligations of any state of the United States, or any political subdivision of any state, or any agencies or other instrumentalities of any such state, including, but not limited to, industrial development bonds, pollution control revenue bonds, public power bonds, housing bonds, other revenue bonds or any general obligation bonds, that, at the time of their purchase, such obligations are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (1) bonds or other debt instruments of any company, if such bonds or other debt instruments, at the time of their purchase, are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (m) mortgage backed securities (i) guaranteed by the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation or the Government National Mortgage Association or rated AAA, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee and (ii) having an average life not to exceed 15 years as determined by standard industry pricing practices presently in effect; (n) asset-backed securities rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee; and (o) such other investments approved in writing by Loan Trustee; provided that, except in clause (m), the instruments described in the foregoing clauses shall have a maturity of no more than six months from the date of acquisition thereof. The bank acting as Pass Through Trustee or Loan Trustee is hereby authorized, in making or disposing of any investment described herein, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or such affiliate is acting as an agent of Pass Through Trustee or Loan Trustee or for any third person or dealing as principal for its own account. "Permitted Lessee" means any Person to whom Company is permitted to lease the Airframe or any Engine pursuant to Section 7.02(a) of the Indenture. "Permitted Lien" has the meaning specified in Section 7.01 of the Indenture. "Person" means any person, including any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, trustee, unincorporated organization or government or any agency or political subdivision thereof. "Policy Provider" means MBIA Insurance Company, a New York-domiciled stock insurance company. "Policy Provider Agreement" means the Insurance and Indemnity Agreement dated as of April 30, 2002 among Subordination Agent, Class G-1 Trustee, Class G-2 Trustee, Company and Policy Provider, including the related Policy Provider Fee Letter referred to therein, as amended, supplemented or otherwise modified from time to time in accordance with its terms. "Purchase Agreement" means Purchase Agreement No. 2022, dated as of October 21, 1997, which incorporates by reference the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, between Manufacturer and Company, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Rating Agencies" has the meaning specified in the Intercreditor Agreement. "Related Indemnitee Group" has the meaning specified in Section 4.02(b) of the Participation Agreement. "Replacement Aircraft" means the Aircraft of which a Replacement Airframe is part. "Replacement Airframe" means a Boeing 737-832 aircraft or a comparable or improved model of Manufacturer (except (a) Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (b) items excluded from the definition of Parts (except Engines or engines)), that shall have been made subject to the Lien of the Indenture pursuant to Section 7.05 thereof, together with all Parts relating to such aircraft. "Replacement Engine" means a CFM International, Inc. CFM56-7B engine, which may be rated at or limited to -24 or higher power, (or an engine of the same or another manufacturer of a comparable or an improved model and suitable for installation and use on the Airframe with the other Engine (or any other Replacement Engine being substituted simultaneously therewith)) that is made subject to the Lien of the Indenture pursuant to Section 7.04 or Section 7.05 thereof, together with all Parts relating to such engine. "Responsible Officer" means, with respect to Company, its Chairman of the Board, its President, its Chief Operating Officer, any Executive Vice President, any Senior Vice President, the Chief Financial Officer, any Vice President, the Treasurer, the Controller or the Secretary. "Sale/Leaseback Transaction" has the meaning specified for such term in Section 7.11 of the Participation Agreement. "Section 1110" means Section 1110 of the Bankruptcy Code. "Secured Obligations" has the meaning specified in Section 2.06 of the Indenture. "Series" means any series of Equipment Notes, including the Series G-1 Equipment Notes, the Series G-2 Equipment Notes, or the Series C Equipment Notes. "Series C Equipment Notes" means Equipment Notes issued and designated as "Series C Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series C Equipment Notes." "Series G-1 Equipment Notes" means Equipment Notes issued and designated as "Series G-1 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-1 Equipment Notes." "Series G-2 Equipment Notes" means Equipment Notes issued and designated as "Series G-2 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-2 Equipment Notes." "State Street" has the meaning specified in the introductory paragraph of the Participation Agreement. "Subordination Agent" has the meaning specified in the introductory paragraph of the Participation Agreement. "Tax" and "Taxes" mean all governmental fees (including, without limitation. license, filing and registration fees) and all taxes (including, without limitation, franchise, excise, stamp, value added, income, gross receipts, sales, use and property taxes), withholdings, assessments, levies, imposts, duties or charges, of any nature whatsoever, together with any related penalties, fines, additions to tax or interest thereon imposed, withheld, levied or assessed by any country, taxing authority or governmental subdivision thereof or therein or by any international authority, including any taxes imposed on any Person as a result of such Person being required to collect and pay over withholding taxes. "Transportation Code" means that portion of Title 49 of the United States Code comprising those provisions formerly referred to as the Federal Aviation Act of 1958, as amended, or any subsequent legislation that amends, supplements or supersedes such provisions. "Trust Supplements" means those agreements supplemental to the Basic Pass Through Trust Agreement referred to in Schedule II to the Participation Agreement. "Underwriters" means the several underwriters listed as such in the Underwriting Agreement. "Underwriting Agreement" means that certain Underwriting Agreement, dated April 23, 2002, among Company and Underwriters. "United States" means the United States of America. "U.S. Government Obligations" means securities that are direct obligations of the United States for the payment of which its full faith and credit is pledged which are not callable or redeemable, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligations or a specific payment of interest on or principal of any such U.S. Government Obligations held by such custodian for the account of the holder of a depository receipt so long as such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of interest on or principal of the U.S. Government Obligations evidenced by such depository receipt. "Warranty Bill of Sale" means the warranty (as to title) bill of sale covering the Aircraft executed by Manufacturer or an affiliate of Manufacturer in favor of Company and specifically referring to each Engine, as well as the Airframe, constituting a part of the Aircraft. "Warranty Rights" means all right and interest of Company in, to and under Parts 1, 2, 3, 4 and 6 of the Product Assurance Document attached as Exhibit C to the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, but only to the extent the same relate to continuing rights of Company in respect of any warranty or indemnity, express or implied, pursuant to the Product Assurance Document with respect to the Airframe, it being understood that the Warranty Rights exclude any and all other right, title and interest of Company in, to and under the Purchase Agreement and that the Warranty Rights are subject to the terms of the Manufacturer's Consent. EX-4.(E)(2) 13 de763576-ex4e2.txt INDENTURE AND SECURITY AGREEMENT Exhibit 4(e)(2) INDENTURE AND SECURITY AGREEMENT (N372DA) Dated as of April 30, 2002 between DELTA AIR LINES, INC., and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee One Boeing 737-832 Aircraft U.S. Registration No. N372DA TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 1.01 Definitions....................................................... Section 1.02 Other Definitional Provisions..................................... ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes........................................... Section 2.02 Issuance and Terms of Equipment Notes............................. Section 2.03 Method of Payment................................................. Section 2.04 Withholding Taxes................................................. Section 2.05 Application of Payments........................................... Section 2.06 Termination of Interest in Collateral............................. Section 2.07 Registration, Transfer and Exchange of Equipment Notes............ Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes.............. Section 2.09 Payment of Expenses on Transfer; Cancellation..................... Section 2.10 Mandatory Redemption of Equipment Notes........................... Section 2.11 Voluntary Redemption of Equipment Notes........................... Section 2.12 Redemptions; Notice of Redemptions; Repurchases................... Section 2.13 Subordination..................................................... Section 2.14 Certain Payments.................................................. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee..................................................... Section 2.16 Directions by Subordination Agent................................. Section 2.17 Assumption of Equipment Notes..................................... ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE COLLATERAL Section 3.01 Basic Distributions............................................... Section 3.02 Event of Loss; Optional Redemption................................ Section 3.03 Payments after Event of Default................................... Section 3.04 Certain Payments.................................................. Section 3.05 Payments to Company............................................... ARTICLE IV EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Events of Default................................................. Section 4.02 Remedies.......................................................... Section 4.03 Remedies Cumulative............................................... Section 4.04 Discontinuance of Proceedings..................................... Section 4.05 Waiver of Past Defaults........................................... Section 4.06 Noteholders May Not Bring Suit Except Under Certain Conditions....................................................... ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Event of Default........................................ Section 5.02 Action upon Instructions; Certain Rights and Limitations.......... Section 5.03 Indemnification................................................... Section 5.04 No Duties Except as Specified in Indenture or Instructions........ Section 5.05 No Action Except under Indenture or Instructions.................. Section 5.06 Investment of Amounts Held by Loan Trustee........................ ARTICLE VI LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties................................... Section 6.02 Absence of Certain Duties......................................... Section 6.03 No Representations or Warranties as to the Documents.............. Section 6.04 No Segregation of Monies; No Interest............................. Section 6.05 Reliance; Agents; Advice of Counsel............................... Section 6.06 Instructions from Noteholders..................................... ARTICLE VII OPERATING COVENANTS OF COMPANY Section 7.01 Liens............................................................. Section 7.02 Possession, Operation and Use, Maintenance and Registration...................................................... Section 7.03 Inspection; Financial Information................................. Section 7.04 Replacement and Pooling of Parts; Alterations, Modifications and Additions; Substitution of Engines............. Section 7.05 Loss, Destruction or Requisition.................................. Section 7.06 Insurance......................................................... ARTICLE VIII SUCCESSOR AND ADDITIONAL TRUSTEES Section 8.01 Resignation or Removal; Appointment of Successor.................. Section 8.02 Appointment of Additional and Separate Trustees................... ARTICLE IX AMENDMENTS AND WAIVERS Section 9.01 Amendments to this Indenture without Consent of Holders........... Section 9.02 Amendments to this Indenture with Consent of Holders.............. Section 9.03 Amendments, Waivers, Etc. of the Participation Agreement.......... Section 9.04 Revocation and Effect of Consents................................. Section 9.05 Notation on or Exchange of Equipment Notes........................ Section 9.06 Trustee Protected................................................. ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture.......................................... Section 10.02 No Legal Title to Collateral in Noteholders....................... Section 10.03 Sale of Aircraft by Loan Trustee is Binding....................... Section 10.04 Indenture for Benefit of Company, Loan Trustee and Noteholders...................................................... Section 10.05 Notices........................................................... Section 10.06 Severability...................................................... Section 10.07 No Oral Modification or Continuing Waivers........................ Section 10.08 Successors and Assigns............................................ Section 10.09 Headings.......................................................... Section 10.10 Normal Commercial Relations....................................... Section 10.11 Voting by Noteholders............................................. Section 10.12 Section 1110...................................................... Section 10.13 Company's Performance and Rights.................................. Section 10.14 Counterparts...................................................... Section 10.15 Governing Law..................................................... Section 10.16 Confidential Information.......................................... Section 10.17 Submission to Jurisdiction........................................ Exhibit A - Form of Indenture Supplement Exhibit B - List of Permitted Countries Exhibit C - Aircraft Type Equipment Value for Section 7.06(b) Schedule I - Description of Equipment Notes Schedule II - Pass Through Trust Agreement and Pass Through Trust Supplements Annex A - Definitions INDENTURE AND SECURITY AGREEMENT (N372DA) This INDENTURE AND SECURITY AGREEMENT (N372DA ), dated as of April 30, 2002, is made by and between DELTA AIR LINES, INC., a Delaware corporation (together with its successors and permitted assigns, "Company"), and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity, except as expressly stated herein, but solely as Loan Trustee hereunder (together with its permitted successors hereunder, "Loan Trustee"). W I T N E S S E T H: WHEREAS, the parties desire by this Indenture (such term and other capitalized terms used herein without definition being defined as provided in Article I), among other things, to provide for (i) the issuance by Company of the Equipment Notes and (ii) the assignment, mortgage and pledge by Company to Loan Trustee, as part of the Collateral hereunder, among other things, of all of Company's estate, right, title and interest in and to the Aircraft, as security for, among other things, Company's obligations to Loan Trustee, for the ratable benefit and security of Noteholders, subject to Section 2.13 and Article III; WHEREAS, all things have been done to make the Equipment Notes, when executed by Company and authenticated and delivered by Loan Trustee hereunder, the valid, binding and enforceable obligations of Company; and WHEREAS, all things necessary to make this Indenture a legal, valid and binding obligation of Company for the uses and purposes herein set forth, in accordance with its terms, have been done and performed and have occurred; GRANTING CLAUSE NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and all other amounts payable by Company under the Operative Documents and the performance and observance by Company of all the agreements and covenants to be performed or observed by Company for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Company at or before the Closing Date, the receipt of which is hereby acknowledged, Company does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Company in, to and under, all and singular, the following described properties, rights, interests and privileges whether now or hereafter acquired (hereinafter sometimes referred to as the "Collateral"): (1) the Aircraft, including the Airframe and the Engines, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided herein, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto (such Airframe and Engines as more particularly described in the Indenture Supplement executed and delivered with respect to the Aircraft on the Closing Date or with respect to any substitutions or replacements therefor) and together with all logs, manuals maintained on the Aircraft, modification and maintenance records at any time required to be maintained with respect to the Aircraft, in accordance with the rules and regulations of the FAA if the Aircraft is registered under the laws of the United States or the rules and regulations of the government of the country of registry if the Aircraft is registered under the laws of a jurisdiction other than the United States; (2) the Warranty Rights, together with all rights, powers, privileges, options and other benefits of Company under the same; (3) all requisition proceeds with respect to the Aircraft or any Part thereof, and all insurance proceeds with respect to the Aircraft or any Part thereof, but excluding all proceeds of, and rights under, any insurance maintained by Company and in excess of that required under Section 7.06(b); (4) all moneys and securities now or hereafter paid or deposited or required to be paid or deposited to or with Loan Trustee by or for the account of Company pursuant to any term of any Operative Document and held or required to be held by Loan Trustee hereunder or thereunder; and (5) all proceeds of the foregoing; PROVIDED, HOWEVER, that notwithstanding any of the foregoing provisions, so long as no Event of Default shall have occurred and be continuing, Company shall have the right, to the exclusion of Loan Trustee, (i) to quiet enjoyment of the Aircraft, the Airframe, the Parts and the Engines, and to possess, use, retain and control the Aircraft, the Airframe, the Parts and the Engines and all revenues, income and profits derived therefrom and (ii) with respect to the Warranty Rights, to exercise in Company's name all rights and powers of the Buyer (as defined in the Purchase Agreement) under the Warranty Rights and to retain any recovery or benefit resulting from the enforcement of any warranty or indemnity or other obligation under the Warranty Rights; provided, further, that notwithstanding the occurrence and continuation of an Event of Default, Loan Trustee shall not enter into any amendment or modification of the Purchase Agreement that would alter the rights, benefits or obligations of Company thereunder; TO HAVE AND TO HOLD all and singular the aforesaid property unto Loan Trustee, and its successors and permitted assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in this Indenture, including Section 2.13 and Article III, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and in all cases and as to all property specified in paragraphs (1) through (5) inclusive above, subject to the terms and provisions set forth in this Indenture. It is expressly agreed that notwithstanding anything herein to the contrary, Company shall remain liable under the Purchase Agreement to perform all of its obligations thereunder, and, except to the extent expressly provided in any Operative Document, none of Loan Trustee, any Noteholders or any Indenture Indemnitee shall be required or obligated in any manner to perform or fulfill any obligations of Company under or pursuant to any Operative Document, or to make any inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or take any action to collect or enforce the payment of any amount that may have been assigned to it or to which it may be entitled at any time or times. Notwithstanding anything herein to the contrary (but without in any way releasing Company from any of its duties or obligations under the Purchase Agreement), Loan Trustee, Noteholders and Indenture Indemnitees confirm for the benefit of Manufacturer that in exercising any rights under the Warranty Rights, or in making any claim with respect to the Aircraft or other goods and services delivered or to be delivered pursuant to the Purchase Agreement, the terms and conditions of the Purchase Agreement relating to the Warranty Rights, including, without limitation, the warranty disclaimer provisions for the benefit of Manufacturer, shall apply to and be binding upon Loan Trustee, Noteholders and Indenture Indemnitees to the same extent as Company. Company hereby directs Manufacturer, so long as an Event of Default shall have occurred and be continuing, to pay all amounts, if any, payable to Company pursuant to the Warranty Rights directly to Loan Trustee to be held and applied as provided herein. Nothing contained herein shall subject Manufacturer to any liability to which it would not otherwise be subject under the Purchase Agreement or modify in any respect the contract rights of Manufacturer thereunder except as provided in the Manufacturer's Consent. Company does hereby constitute Loan Trustee the true and lawful attorney of Company (which appointment is coupled with an interest) with full power (in the name of Company or otherwise) to ask, require, demand and receive any and all monies and claims for monies (in each case including insurance and requisition proceeds) due and to become due to Company under or arising out of the Purchase Agreement (to the extent assigned hereby), and all other property which now or hereafter constitutes part of the Collateral, to endorse any checks or other instruments or orders in connection therewith and to file any claims or to take any action or to institute any proceedings which Loan Trustee may deem to be necessary or advisable in the premises; provided that Loan Trustee shall not exercise any such rights except during the continuance of an Event of Default. Company agrees that promptly upon receipt thereof, to the extent required by the Operative Documents, it will transfer to Loan Trustee any and all monies from time to time received by Company constituting part of the Collateral, for distribution by Loan Trustee pursuant to this Indenture. Company does hereby warrant and represent that it has not sold, assigned or pledged, and hereby covenants and agrees that it will not sell, assign or pledge, so long as this Indenture shall remain in effect and the Lien hereof shall not have been released pursuant to the provisions hereof, any of its estate, right, title or interest hereby assigned, to any Person other than Loan Trustee, except as otherwise provided in or permitted by any Operative Document. Company agrees that at any time and from time to time, upon the written request of Loan Trustee, Company shall promptly and duly execute and deliver or cause to be duly executed and delivered any and all such further instruments and documents as Loan Trustee may reasonably deem necessary to perfect, preserve or protect the mortgage, security interests and assignments created or intended to be created hereby or to obtain for Loan Trustee the full benefit of the assignment hereunder and of the rights and powers herein granted, provided that any instrument or other document so executed by Company will not expand any obligations or limit any rights of Company in respect of the transactions contemplated by the Operative Documents. IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. For all purposes of this Indenture, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Indenture to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Indenture, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". (e) All references in this Indenture to a "government" are to such government and any instrumentality or agency thereof. ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes. The Equipment Notes shall be substantially in the form set forth below: THIS EQUIPMENT NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. ACCORDINGLY, THIS EQUIPMENT NOTE MAY NOT BE OFFERED FOR SALE OR SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND SUCH APPLICABLE STATE OR OTHER LAWS OR EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. DELTA AIR LINES, INC. SERIES 2002-1 [___] EQUIPMENT NOTE DUE [___] ISSUED IN CONNECTION WITH THE BOEING 737-832 AIRCRAFT BEARING UNITED STATES REGISTRATION NUMBER N372DA No.____ Date: [______,__] $_________________ INTEREST RATE MATURITY DATE [____] [____________, ____] DELTA AIR LINES, INC. (together with its successors and permitted assigns, "Company") hereby promises to pay to ___________, or the registered assignee thereof, the principal amount of ________________ Dollars ($_________) [on __________]1 [in installments on the Payment Dates set forth in Schedule I hereto, each such installment to be in an amount computed by multiplying the original principal amount of this Equipment Note by the percentage set forth in Schedule I hereto opposite the Payment Date on which such installment is due,]2 and to pay interest in arrears on each Payment Date at the Debt Rate on the principal amount remaining unpaid from time to time (calculated on the basis of a year of 360 days comprised of twelve 30-day months) from the date hereof until paid in full. [Notwithstanding the foregoing, the final payment made on this Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, this Equipment Note.]2 Notwithstanding anything to the contrary contained herein, if any date on which a payment under this Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. - ------------------ 1 To be inserted in non-installment Equipment Notes. 2 To be inserted in installment Equipment Notes. For purposes hereof, the term "Indenture" means the Indenture and Security Agreement (N372DA), dated as of April 30, 2002, between Company and State Street Bank and Trust Company of Connecticut, National Association, as Loan Trustee ("Loan Trustee"), as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. All capitalized terms used in this Equipment Note and not defined herein, unless the context otherwise requires, shall have the respective meanings set forth or incorporated by reference, and shall be construed and interpreted in the manner described, in the Indenture. This Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable hereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue if not paid in the manner provided herein or in the Indenture when due (whether at stated maturity, by acceleration or otherwise). There shall be maintained an Equipment Note Register for the purpose of registering transfers and exchanges of Equipment Notes at the Corporate Trust Office of Loan Trustee, or at the office of any successor trustee, in the manner provided in Section 2.07 of the Indenture. The principal amount and interest and other amounts due hereunder shall be payable in Dollars in immediately available funds at the Corporate Trust Office of Loan Trustee, or as otherwise provided in the Indenture. Company shall not have any responsibility for the distribution of any such payment to Noteholder of this Equipment Note. Each such payment shall be made on the date such payment is due and without any presentment or surrender of this Equipment Note, except that in the case of any final payment with respect to this Equipment Note, the Equipment Note shall be surrendered to Loan Trustee for cancellation. The holder hereof, by its acceptance of this Equipment Note, agrees that, except as provided in the Indenture, including the subordination provisions referred to below, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest received by it hereunder shall be applied: first, to the payment of accrued interest on this Equipment Note (as well as any interest on any overdue principal amount, and, to the extent permitted by law, any overdue Make-Whole Amount, if any, any overdue interest and other overdue amounts hereunder) to the date of such payment; second, to the payment of Make-Whole Amount, if any, and third, to the payment of the principal amount of this Equipment Note (or portion hereof) then due. This Equipment Note is one of the Equipment Notes referred to in the Indenture which have been or are to be issued by Company pursuant to the terms of the Indenture. The Collateral is held by Loan Trustee as security, in part, for the Equipment Notes. The provisions of this Equipment Note are subject to the Indenture and the Participation Agreement. Reference is hereby made to the Indenture and the Participation Agreement for a complete statement of the rights and obligations of the holder of, and the nature and extent of the security for, this Equipment Note and the rights and obligations of the holders of, and the nature and extent of the security for, any other Equipment Notes executed and delivered under the Indenture, to all of which terms and conditions in the Indenture and the Participation Agreement each holder hereof agrees by its acceptance of this Equipment Note. As provided in the Indenture and subject to certain limitations therein set forth, this Equipment Note is exchangeable for a like aggregate principal amount of Equipment Notes of the same Series of different authorized denominations, as requested by the holder surrendering the same. Prior to the due presentment for registration of transfer of this Equipment Note, Company and Loan Trustee shall deem and treat the Person in whose name this Equipment Note is registered on the Equipment Note Register as the absolute owner and holder hereof for the purpose of receiving all amounts payable with respect to this Equipment Note and for all purposes, and neither Company nor Loan Trustee shall be affected by notice to the contrary. This Equipment Note is subject to redemption as provided in Sections 2.10 and 2.11 of the Indenture but not otherwise. This Equipment Note is also subject to assumption by an owner trustee and reoptimization (by changing the maturity date and/or the principal payment requirements) as provided in Section 2.17 of the Indenture. The indebtedness evidenced by this Equipment Note [shall rank in right of payment equally with all Series G-2 Equipment Notes and all other Series G-1 Equipment Notes.]3 [shall rank in right of payment equally with all Series G-1 Equipment Notes and all other Series G-2 Equipment Notes.]4 [is, to the extent and in the manner provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations (as defined in the Indenture) in respect of [Series G-1 Equipment Notes and Series G-2 Equipment Notes]5, and this Equipment Note is issued subject to such provisions.]6 Noteholder of this Equipment Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs Loan Trustee on such Noteholder's behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in the Indenture and (c) appoints Loan Trustee such Noteholder's attorney-in-fact for such purpose. - ------------------ 3 To be inserted in the case of a Series G-1 Equipment Note. 4 To be inserted in the case of a Series G-2 Equipment Note. 5 To be inserted in the case of a Series C Equipment Note. 6 To be inserted in the case of a Series C Equipment Note. [Without limiting the foregoing, the]7 [The]8 Noteholder of this Equipment Note, by accepting the same, agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligation in respect of this Equipment Note that it is not entitled to receive under Section 2.13 or Article III of the Indenture, it shall hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III of the Indenture. Unless the certificate of authentication hereon has been executed by or on behalf of Loan Trustee by manual signature, this Equipment Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. - ------------------ 7 To be inserted in the case of a Series C Equipment Note. 8 To be inserted in the case of a Series G-1 Equipment Note or a Series G-2 Equipment Note. THIS EQUIPMENT NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. IN WITNESS WHEREOF, Company has caused this Equipment Note to be executed in its corporate name by its officer thereunto duly authorized on the date hereof. DELTA AIR LINES, INC. By: ------------------------------------ Name: Title: LOAN TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Equipment Notes referred to in the within-mentioned Indenture. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee By: ------------------------------------ Name: Title: SCHEDULE I (9) EQUIPMENT NOTE AMORTIZATION Payment Date Percentage of Original Principal Amount to be Paid [SEE "EQUIPMENT NOTES AMORTIZATION" ON SCHEDULE I TO INDENTURE WHICH IS TO BE INSERTED UPON ISSUANCE] * * * Section 2.02 Issuance and Terms of Equipment Notes. The Equipment Notes shall be dated the date of issuance thereof, shall be issued in (a) three separate series consisting of Series G-1 Equipment Notes, Series G-2 Equipment Notes, and Series C Equipment Notes and (b) the maturities and principal amounts and shall bear interest at the applicable Debt Rates specified in Schedule I. On the Closing Date, each Series G-1 Equipment Note, Series G-2 Equipment Note, and Series C Equipment Note shall be issued to Subordination Agent on behalf of each of Pass Through Trustees for the Pass Through Trusts created under the Pass Through Trust Agreements referred to in Schedule II. The Equipment Notes shall be issued in registered form only. The Equipment Notes shall be issued in denominations of $1,000 and integral multiples thereof, except that one Equipment Note of each Series may be in an amount that is not an integral multiple of $1,000. - --------------- (9) To be inserted on installment Equipment Notes. Each Equipment Note shall bear interest at the Debt Rate (calculated on the basis of a year of 360 days comprised of twelve 30-day months), payable in arrears on each Payment Date on the unpaid principal amount thereof from time to time outstanding until such principal amount is paid in full, as further provided in the form of Equipment Note set forth in Section 2.01. The principal amount of each Series G-1 Equipment Note and each Series C Equipment Note shall be payable in installments on the Payment Dates and in the installments equal to the corresponding percentage of the principal amount set forth in Schedule I hereto applicable to such Series, which shall be attached as Schedule I to such Equipment Note. The principal amount of each Series G-2 Equipment Note shall be due in a single payment on July 2, 2012. Notwithstanding the foregoing, the final payment made under each Series G-1 Equipment Note and each Series C Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, such Equipment Note. Each Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not at the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable thereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue under an Equipment Note if not paid in the manner provided therein or in this Indenture when due (whether at stated maturity, by acceleration or otherwise). Notwithstanding anything to the contrary contained herein, if any date on which a payment hereunder or under any Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. The Equipment Notes shall be executed on behalf of Company by the manual or facsimile signature of one of its authorized officers. Equipment Notes bearing the signatures of individuals who were at the time of execution the proper officers of Company shall bind Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Equipment Notes or did not hold such offices at the respective dates of such Equipment Notes. No Equipment Note shall be secured by or entitled to any benefit under this Indenture or be valid or obligatory for any purposes unless there appears on such Equipment Note a certificate of authentication in the form provided herein executed by Loan Trustee by the manual signature of one of its authorized officers, and such certificate upon any Equipment Notes shall be conclusive evidence, and the only evidence, that such Equipment Note has been duly authenticated and delivered hereunder. Section 2.03 Method of Payment. The principal amount of, interest on, Make-Whole Amount, if any, and, except to the extent expressly provided herein, all other amounts due to any Noteholder under each Equipment Note or otherwise payable hereunder shall be payable by Company in Dollars by wire transfer of immediately available funds not later than 10:00 a.m. (New York City time) on the due date of payment to Loan Trustee at the Corporate Trust Office for distribution among Noteholders in the manner provided herein. Company shall not have any responsibility for the distribution of such payment to any Noteholder. Notwithstanding the foregoing or any provision in any Equipment Note to the contrary, Loan Trustee will use reasonable efforts to pay or cause to be paid, if so directed in writing by any Noteholder (with a copy to Company), all amounts paid by Company hereunder and under such Noteholder's Equipment Note or Equipment Notes to such Noteholder or a nominee therefor (including all amounts distributed pursuant to Article III) by transferring, or causing to be transferred, by wire transfer of immediately available funds in Dollars, prior to 12:00 noon (New York City time) on the due date of payment, to an account maintained by such Noteholder with a bank located in the continental United States the amount to be distributed to such Noteholder, for credit to the account of such Noteholder maintained at such bank; provided that, in the event the Equipment Notes are not held by Subordination Agent on behalf of Pass Through Trustees, Loan Trustee may at its option pay such amounts by check mailed to Noteholder's address as it appears on the Equipment Note Register. If, after its receipt of funds at the place and prior to the time specified above in the immediately preceding sentence, Loan Trustee fails (other than as a result of a failure of Noteholder to provide it with wire transfer instructions) to make any such payment required to be paid by wire transfer as provided in the immediately preceding sentence on the Business Day it receives such funds, Loan Trustee, in its individual capacity and not as trustee, agrees to compensate such Noteholders for loss of use of funds at the Federal Funds Rate until such payment is made and Loan Trustee shall be entitled to any interest earned on such funds until such payment is made. Any payment made hereunder shall be made without any presentment or surrender of any Equipment Note, except that, in the case of the final payment in respect of any Equipment Note, such Equipment Note shall be surrendered to Loan Trustee for cancellation. Notwithstanding any other provision of this Indenture to the contrary, Loan Trustee shall not be required to make, or cause to be made, wire transfers as aforesaid prior to the first Business Day on which it is practicable for Loan Trustee to do so in view of the time of day when the funds to be so transferred were received by it if such funds were received after 1:00 p.m. (New York City time) at the place of payment. Section 2.04 Withholding Taxes. Loan Trustee shall exclude and withhold at the appropriate rate from each payment of principal amount of, interest on, Make-Whole Amount, if any, and other amounts due hereunder or under each Equipment Note (which exclusion and withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) any and all withholding taxes applicable thereto as required by law. Loan Trustee agrees to act as such withholding agent and, in connection therewith, whenever any present or future taxes or similar charges are required to be withheld with respect to any amounts payable hereunder or in respect of the Equipment Notes, to withhold such amounts (which withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) and timely pay the same to the appropriate authority in the name of and on behalf of Noteholders, that it will file any necessary withholding tax returns or statements when due, and that as promptly as possible after the payment thereof it will deliver to each Noteholder (with a copy to Company) appropriate documentation showing the payment thereof, together with such additional documentary evidence as any such Noteholder may reasonably request from time to time. Loan Trustee agrees to file any other information reports it is required to file under United States law. Section 2.05 Application of Payments. Subject always to Section 2.13 and except as otherwise provided in Article III, in the case of each Equipment Note, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest paid thereon shall be applied: first, to the payment of accrued interest on such Equipment Note (as well as any interest on any overdue principal amount and (to the extent permitted by law) any overdue Make-Whole Amount, if any, any overdue interest and any other overdue amounts thereunder) to the date of such payment; and second, to the payment of Make-Whole Amount, if any; and third, to the payment of principal amount of such Equipment Note (or portion thereof) then due thereunder. Section 2.06 Termination of Interest in Collateral. No Noteholder or Indenture Indemnitee shall, as such, have any further interest in, or other right with respect to, the Collateral when and if the principal amount of, Make-Whole Amount, if any, and interest (including interest on any overdue amounts) on and all other amounts due under all Equipment Notes held by such Noteholder and all other sums then payable to such Noteholder or Indenture Indemnitee, as the case may be, hereunder and under the Participation Agreement by Company (collectively, "Secured Obligations") have been paid in full. Section 2.07 Registration, Transfer and Exchange of Equipment Notes. Loan Trustee shall keep a register or registers (the "Equipment Note Register") in which Loan Trustee shall provide for the registration of Equipment Notes and the registration of transfers of Equipment Notes. No such transfer shall be given effect unless and until registration hereunder shall have occurred. The Equipment Note Register shall be kept at the Corporate Trust Office of Loan Trustee. Loan Trustee is hereby appointed "Equipment Note Registrar" for the purpose of registering Equipment Notes and transfers of Equipment Notes. A holder of any Equipment Note intending to exchange or transfer such Equipment Note shall surrender such Equipment Note to Loan Trustee at the Corporate Trust Office, together with a written request from the registered holder thereof for the issuance of a new Equipment Note of the same Series, specifying, in the case of a surrender for transfer, the name and address of the new holder or holders. Upon surrender for registration of transfer of any Equipment Note and subject to satisfaction of Section 2.09, Company shall execute, and Loan Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Equipment Notes of an equal aggregate principal amount and of the same Series. At the option of Noteholder, Equipment Notes may be exchanged for other Equipment Notes of the same Series of any authorized denominations of an equal aggregate principal amount, upon surrender of the Equipment Notes to be exchanged to Loan Trustee at the Corporate Trust Office. Whenever any Equipment Notes are so surrendered for exchange, Company shall execute, and Loan Trustee shall authenticate and deliver, the Equipment Notes which Noteholder making the exchange is entitled to receive. All Equipment Notes issued upon any registration of transfer or exchange of Equipment Notes (whether under this Section 2.07 or under Section 2.08 or otherwise under this Indenture) shall be the valid obligations of Company evidencing the same respective obligations, and entitled to the same security and benefits under this Indenture, as the Equipment Notes surrendered upon such registration of transfer or exchange. Every Equipment Note presented or surrendered for registration of transfer shall be duly endorsed or be accompanied by a written instrument of transfer in form satisfactory to Loan Trustee, duly executed by Noteholder or such Noteholder's attorney duly authorized in writing, and Loan Trustee shall require evidence satisfactory to it as to the compliance of any such transfer with the Securities Act of 1933, as amended, and the securities laws of any applicable state or jurisdiction. Loan Trustee shall make a notation on each new Equipment Note of the amount of all payments of principal amount previously made on the old Equipment Note or Equipment Notes with respect to which such new Equipment Note is issued and the date to which interest on such old Equipment Note or Equipment Notes has been paid. Principal, interest and all other amounts shall be deemed to have been paid on such new Equipment Note to the date on which such amounts have been paid on such old Equipment Note. Company shall not be required to exchange any surrendered Equipment Notes as provided above (a) during the ten-day period preceding the due date of any payment on such Equipment Note or (b) that has been called for redemption. Company and Loan Trustee shall in all cases deem and treat the Person in whose name any Equipment Note has been issued and registered on the Equipment Note Register as the absolute owner and Noteholder of such Equipment Note for the purpose of receiving payment of all amounts payable with respect to such Equipment Note and for all other purposes, and neither Company nor Loan Trustee shall be affected by any notice to the contrary. Loan Trustee will promptly notify Company of each registration of a transfer of an Equipment Note. Any such transferee of an Equipment Note, by its acceptance of an Equipment Note, agrees to the provisions of the Operative Documents applicable to Noteholders, and shall be deemed to have represented, warranted and covenanted to the parties to the Participation Agreement as to the matters represented, warranted and covenanted by Noteholders, including Pass Through Trustees, in the Participation Agreement. Subject to compliance by Noteholder and any transferee of the requirements set forth in this Section 2.07 and in Section 2.09, Loan Trustee and Company shall use all reasonable efforts to issue new Equipment Notes upon transfer or exchange within ten Business Days of the date an Equipment Note is surrendered for transfer or exchange. Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes. If any Equipment Note becomes mutilated, destroyed, lost or stolen, Company shall, upon the written request of the holder of such Equipment Note and subject to satisfaction of this Section 2.08 and of Section 2.09, execute and Loan Trustee shall authenticate and deliver in replacement thereof a new Equipment Note of the same Series, payable in the same principal amount, dated the same date and captioned as issued in connection with the Aircraft. If the Equipment Note being replaced has become mutilated, such Equipment Note shall be surrendered to Loan Trustee, and a photocopy thereof shall be furnished to Company. If the Equipment Note being replaced has been destroyed, lost or stolen, the holder of such Equipment Note shall furnish to Company and Loan Trustee such security or indemnity as may be required by them to save Company and Loan Trustee harmless and evidence satisfactory to Company and Loan Trustee of the destruction, loss or theft of such Equipment Note and of the ownership thereof. Section 2.09 Payment of Expenses on Transfer; Cancellation. (a) No service charge shall be made to a Noteholder for any registration of transfer or exchange of Equipment Notes, but Loan Trustee, as Equipment Note Registrar, may require payment of a sum sufficient to cover any Tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Equipment Notes. (b) Loan Trustee shall cancel all Equipment Notes surrendered for replacement, redemption, transfer, exchange, payment or cancellation, shall keep a copy of such canceled Equipment Notes, and shall send the original canceled Equipment Notes marked "canceled" to Company. Section 2.10 Mandatory Redemption of Equipment Notes. Company shall redeem the Equipment Notes in whole in connection with an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon (unless Company has performed the option set forth in Section 7.05(a)(i) with respect thereto) on or before the Loss Payment Date at a redemption price equal to 100% of the unpaid principal amount thereof, together with all accrued interest thereon to (but excluding) the date of redemption, but without any Make-Whole Amount. Section 2.11 Voluntary Redemption of Equipment Notes. All, but not less than all, of the Equipment Notes may be redeemed in whole by Company upon at least 20 days' revocable prior written notice to Loan Trustee at a redemption price equal to 100% of the unpaid principal amount of the Equipment Notes being redeemed, together with accrued interest thereon to (but excluding) the date of redemption and all other amounts payable hereunder or under the Participation Agreement to Noteholders plus the Make-Whole Amount, if any. Any notice shall become irrevocable three days before the redemption date if not previously revoked. Section 2.12 Redemptions; Notice of Redemptions; Repurchases. (a) No redemption of any Equipment Note may be made except to the extent and in the manner expressly permitted by this Indenture. At such time as no Pass Through Certificates are outstanding, Company may at any time repurchase any of the Equipment Notes at any price in the open market and may hold, resell or surrender such Equipment Notes to Loan Trustee for cancellation. (b) Notice of redemption with respect to the Equipment Notes shall be given by Loan Trustee by first-class mail, postage prepaid, mailed not less than 15 nor more than 60 days prior to the applicable redemption date, to each Noteholder at such Noteholder's address appearing in the Equipment Note Register. All notices of redemption shall state: (1) the redemption date, (2) the applicable basis for determining the redemption price, (3) that on the redemption date, the redemption price will become due and payable upon each such Equipment Note, and that, if any such Equipment Notes are then outstanding, interest on such Equipment Notes shall cease to accrue on and after such redemption date and (4) the place or places where such Equipment Notes are to be surrendered for payment of the redemption price. (c) On or before the redemption date, Company (or any person on behalf of Company) shall, to the extent an amount equal to the redemption price for the Equipment Notes to be redeemed on the redemption date shall not then be held in the Collateral, deposit or cause to be deposited with Loan Trustee by 10:00 a.m. (New York City time) on the redemption date in immediately available funds the redemption price of the Equipment Notes to be redeemed. (d) Notice of redemption having been given as aforesaid (and not revoked as permitted by Section 2.11), the Equipment Notes to be redeemed shall, on the redemption date, become due and payable at the Corporate Trust Office of Loan Trustee, and from and after such redemption date (unless there is a default in the deposit of the redemption price pursuant to Section 2.12(c)) any such Equipment Notes then outstanding shall cease to bear interest. Upon surrender of any such Equipment Note for redemption in accordance with said notice, such Equipment Note shall be redeemed at the redemption price. Section 2.13 Subordination. (a) The indebtedness evidenced by the Series G-1 Equipment Notes and Series G-2 Equipment Notes shall rank in right of payment equally with all other Series G-1 Equipment Notes and Series G-2 Equipment Notes. The indebtedness evidenced by the Series C Equipment Notes is, to the extent and in the manner provided in this Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes, and the Series C Equipment Notes are issued subject to such provisions. By acceptance of its Equipment Notes of any Series, each Noteholder of such Series (a) agrees to and shall be bound by such provisions, (b) authorizes and directs Loan Trustee on such Noteholder's behalf to take any action necessary or appropriate to effectuate the subordination as provided in this Indenture and (c) appoints Loan Trustee as such Noteholder's attorney-in-fact for such purpose. (b) Company, Loan Trustee and, by acceptance of its Equipment Notes of any Series, each Noteholder of such Series, hereby agree that no payment or distribution shall be made on or in respect of the Secured Obligations owed to such Noteholder of such Series, including any payment or distribution of cash, property or securities, after the occurrence of any of the events referred to in Section 4.01(f) or after the commencement of any proceedings of the type referred to in Sections 4.01(g), (h) or (i), except as expressly provided in Article III. (c) By the acceptance of its Equipment Notes of any Series, each Noteholder of such Series agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligations in respect of such Series that it is not entitled to receive under this Section 2.13 or Article III hereof, it will hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III. Section 2.14 Certain Payments. Company agrees to pay to Loan Trustee for distribution in accordance with Section 3.04: (a) an amount or amounts equal to the fees payable to Liquidity Provider under Section 2.03 of each Liquidity Facility and the related Fee Letter (as defined in the Intercreditor Agreement), multiplied by a fraction, the numerator of which is the sum of the then outstanding aggregate principal amount of the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes and the denominator of which is the sum of the then outstanding aggregate principal amount of all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement); (b) if any payment default shall have occurred and be continuing with respect to interest on any Series G-1 Equipment Note, Series G-2 Equipment Note or Series C Equipment Note, (x) the excess, if any, of (1) the amount equal to the sum of interest on any Unpaid Advance or Applied Provider Advance payable under Section 3.07 of each Liquidity Facility plus any other amounts payable in respect of such Unpaid Advance or Applied Provider Advance under Section 3.01, 3.03 or 3.09 of the Liquidity Facility under which such Unpaid Advance or Applied Provider Advance was made over (2) the sum of Investment Earnings from any Final Advance plus any amount of interest at the Past Due Rate actually payable (whether or not in fact paid) by Company in respect of the overdue scheduled interest on the Equipment Notes, multiplied by (y) a fraction, the numerator of which is the then aggregate overdue amounts of interest on the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes (other than interest becoming due and payable solely as a result of acceleration of any such Equipment Notes) and the denominator of which is the then aggregate overdue amounts of interest on all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement) (other than interest becoming due and payable solely as a result of acceleration of any such "Equipment Notes"); (c) any amounts owed to Liquidity Provider by Subordination Agent as borrower under Section 3.01 (other than in respect of an Unpaid Advance or Applied Provider Advance), 3.03 (other than in respect of an Unpaid Advance or Applied Provider Advance), 7.05 and 7.07 of each Liquidity Facility multiplied by the fraction specified in the foregoing clause (a); (d) an amount or amounts equal to the compensation, including reasonable expenses and disbursements actually incurred, payable to Subordination Agent under Section 6.07 of the Intercreditor Agreement, multiplied by the fraction specified in the foregoing clause (a) (but in any event without duplication of any amount or amounts payable by Company in respect of such compensation under any other Operative Document or Pass Through Document); and (e) an amount or amounts equal to all compensation and reimbursement of fees, expenses and disbursements (including payment of indemnities) owed to Policy Provider under the Policy Provider Agreement, multiplied by the fraction specified in the foregoing clause (a). For purposes of this paragraph, the terms "Applied Provider Advance", "Cash Collateral Account", "Final Advance", "Investment Earnings", "Replacement Liquidity Facility" and "Unpaid Advance" have the meanings specified in each Liquidity Facility or the Intercreditor Agreement. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee. Any money held by Loan Trustee in trust for any payment of the principal of, Make-Whole Amount, if any, or interest or any other amounts due on, any Equipment Note, including, without limitation, any money deposited pursuant to Section 2.12(c) or Section 10.01, and remaining unclaimed for two years after the due date for such payment (or such lesser time as Loan Trustee is satisfied, after 60 days' notice from Company, is one month prior to the escheat period provided under applicable state law) shall be paid to Company. Noteholders of any outstanding Equipment Notes shall thereafter, as unsecured general creditors, look only to Company for payment thereof, and all liability of Loan Trustee with respect to such trust money shall thereupon cease. Loan Trustee, before being required to make any such repayment, may at the expense of Company cause to be mailed to each such Noteholder notice that such money remains unclaimed. After a date specified in such notice, which may not be less than 30 days from the date of mailing, any unclaimed balance of such money then remaining will be repaid to Company as provided herein. Section 2.16 Directions by Subordination Agent. So long as Subordination Agent is a Noteholder, notwithstanding anything contained herein or in any other Operative Document to the contrary, in exercising its right to vote the Equipment Notes held by it, or in giving or taking any direction, consent, request, demand, instruction, authorization, notice, waiver or other action provided by this Indenture or in respect of the Equipment Notes to be given or taken by a Noteholder (each such vote or other action, a "Direction") in respect of such Equipment Notes, Subordination Agent may act in accordance with any votes, directions, consents, requests, demands, instructions, authorizations, notices, waivers or other actions given or taken by any applicable Pass Through Trustee or the Controlling Party pursuant to the Intercreditor Agreement, including without limitation pursuant to Section 2.06, Article IV or Section 8.01(b) thereof. Subordination Agent shall be permitted (x) to give a Direction with respect to less than the entire principal amount of any single Equipment Note held by it, and (y) to give different Directions with respect to different portions of the principal amount of any single Equipment Note held by it. Any Direction given by Subordination Agent at any time with respect to more than a majority in aggregate unpaid principal amount of all of the Equipment Notes issued and then outstanding hereunder shall be deemed to have been given by a Majority in Interest of Noteholders. Section 2.17 Assumption of Equipment Notes. Pursuant to the provisions of Section 7.11 of the Participation Agreement, an owner trustee shall be entitled to assume on a non-recourse basis all of the obligations of Company hereunder and under the Equipment Notes by an amended and restated indenture, an amended and restated participation agreement, and the issuance of new equipment notes having substantially the same tenor as the Equipment Notes, which new equipment notes may be reoptimized (by changing the maturity date and/or principal payment requirements) in accordance with Section 7.11 of the Participation Agreement. If an owner trustee shall assume such obligations of Company, Company shall be released and discharged from any further obligations hereunder and under the Equipment Notes (except with respect to any such obligations that accrued prior thereto) and the Equipment Notes shall be delivered to Loan Trustee for cancellation. ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE COLLATERAL Section 3.01 Basic Distributions. Except as otherwise provided in Sections 3.02, 3.03 and 3.04, each periodic payment by Company of regularly scheduled installments of principal or interest on the Equipment Notes received by Loan Trustee shall be promptly distributed in the following order of priority: first, so much of such payment as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and any other overdue amounts) then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series G-1 Equipment Note or Series G-2 Equipment Note bears to the aggregate amount of the payments then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes; second, after giving effect to clause "first" above, so much of such payment remaining as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and other overdue amounts) then due under all Series C Equipment Notes shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series C Equipment Note bears to the aggregate amount of the payments then due under all Series C Equipment Notes; and third, the balance, if any, of such installment remaining thereafter shall be distributed to Company. Section 3.02 Event of Loss; Optional Redemption. Except as otherwise provided in Sections 3.03 and 3.04 and subject to the following proviso, any payments received by Loan Trustee with respect to the Aircraft as the result of (a) an Event of Loss (including amounts paid by Company pursuant to Section 2.10) or (b) an optional redemption of the Equipment Notes pursuant to Section 2.11 shall be applied to redemption of the Equipment Notes pursuant to Section 2.10 or Section 2.11, as applicable, and to payment of all other Secured Obligations by applying such funds in the following order of priority: first, (i) to reimburse Loan Trustee and Noteholders for any reasonable costs or expenses actually incurred in connection with such redemption for which they are entitled to reimbursement, or indemnity by Company, under the Operative Documents; and then (ii) to pay any other amounts then due (except as provided in clause "second" below) to Loan Trustee, Noteholders and Indenture Indemnitees under this Indenture, the Participation Agreement or the Equipment Notes; second, (i) to pay the amounts specified in subclause (i) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series G-1 Equipment Notes and the Series G-2 Equipment Notes; and (ii) after giving effect to subclause (i) above, to pay the amounts specified in subclause (ii) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series C Equipment Notes; and third, the balance, if any, of such payments shall be distributed to Company. Notwithstanding the foregoing, any insurance, condemnation or similar proceeds resulting from an Event of Loss that are received by Loan Trustee shall be held or disbursed by Loan Trustee as provided by Sections 7.05(c) and 7.06(d). Any such money held by Loan Trustee shall be invested as provided in Section 5.06. No Make-Whole Amount shall be payable on the Equipment Notes in connection with their redemption as a result of an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon. Section 3.03 Payments after Event of Default. Except as otherwise provided in Section 3.04, all payments received and amounts held or realized by Loan Trustee (including any amounts realized by Loan Trustee from the exercise of any remedies pursuant to Article IV) after both an Event of Default shall have occurred and be continuing and the Equipment Notes shall have become due and payable pursuant to Section 4.02(a), as well as all payments or amounts then held by Loan Trustee as part of the Collateral, shall be promptly distributed by Loan Trustee in the following order of priority: first, so much of such payments or amounts as is required to (i) reimburse Loan Trustee, to the extent Loan Trustee is entitled to be reimbursed or indemnified under the Operative Documents, for any Tax, expense or other loss (including, without limitation, all amounts to be expended at the expense of, or charged upon the tolls, rents, revenues, issues, products and profits of, the Collateral and every part thereof pursuant to Section 4.02(a)) actually incurred by Loan Trustee (to the extent not previously reimbursed), the expenses of any sale, taking or other proceeding, reasonable attorneys' fees and expenses, court costs and any other expenditures actually incurred or expenditures or advances made by Loan Trustee or Noteholders in the protection, exercise or enforcement of any right, power or remedy or any damages sustained by Loan Trustee or any Noteholder, liquidated or otherwise, upon such Event of Default shall be applied by Loan Trustee as between itself and Noteholders in reimbursement of such expenses and any other expenses for which Loan Trustee or Noteholders are entitled to reimbursement under any Operative Document, and (ii) to pay all amounts payable (except as provided in clauses "second" and "third" below) to the other Indenture Indemnitees hereunder and under the Participation Agreement; and in case the aggregate amount so to be distributed is insufficient to pay as aforesaid, then ratably, without priority of one over the other, in proportion to the amounts owed each hereunder; second, so much of such payments or amounts remaining as is required to reimburse the then existing or prior Noteholders for payments made pursuant to Section 5.03 (to the extent not previously reimbursed) shall be distributed to such then existing or prior Noteholders ratably, without priority of one over the other, in accordance with the amount of the payment or payments made by each such then existing or prior Noteholder pursuant to Section 5.03; third, (i) so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes to the date of distribution shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and (ii) after giving effect to subclause (i) above, so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series C Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series C Equipment Notes to the date of distribution shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series C Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series C Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and fourth, the balance, if any, of such payments or amounts shall be distributed to Company. No Make-Whole Amount shall be payable on the Equipment Notes as a consequence of or in connection with an Event of Default or the acceleration of the Equipment Notes. Section 3.04 Certain Payments. (a) Any payments received by Loan Trustee for which provision as to the application thereof is made in this Indenture other than in this Article III shall be applied as provided in those provisions. Without limiting the foregoing, any payments received by Loan Trustee which are payable to Company pursuant to any of the provisions of this Indenture other than those set forth in this Article III (including Sections 5.06, 7.05 and 7.06 hereof) shall be so paid to Company. Any payments received by Loan Trustee for which no provision as to the application thereof is made in this Indenture and for which such provision is made in any other Operative Document shall be applied forthwith to the purpose for which such payment was made in accordance with the terms of such other Operative Document. (b) Loan Trustee will distribute promptly upon receipt any indemnity payment received by it from Company pursuant to Section 4.02 of the Participation Agreement in respect of (i) State Street and Loan Trustee, (ii) Subordination Agent, (iii) Pass Through Trustees, (iv) Liquidity Provider and (v) Policy Provider, in each case, directly to the Person entitled thereto. Any payment received by Loan Trustee from Company under Section 2.14 shall be distributed to Subordination Agent to be distributed in accordance with Section 2.03(c) of the Intercreditor Agreement. (c) Any payments received by Loan Trustee not constituting part of the Collateral or otherwise for which no provision as to the application thereof is made in any Operative Document shall be distributed by Loan Trustee to Company. Further, and except as otherwise provided in Sections 3.02, 3.03 and 3.04, all payments received and amounts realized by Loan Trustee with respect to the Aircraft, to the extent received or realized at any time after payment in full of all Secured Obligations or after the conditions set forth in Section 10.01(a)(ii) for the defeasance of this Indenture have been satisfied, as well as any amounts remaining as part of the Collateral after the occurrence of such payment in full or defeasance, shall be distributed by Loan Trustee to Company. Section 3.05 Payments to Company. Any amounts distributed hereunder by Loan Trustee to Company shall be paid to Company (within the time limits contemplated by Section 2.03) by wire transfer of funds of the type received by Loan Trustee at such office and to such account or accounts of such entity or entities as shall be designated by notice from Company to Loan Trustee from time to time. ARTICLE IV EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Events of Default. Each of the following events constitutes an "Event of Default" whether such event is voluntary or involuntary or comes about or is effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body and each such Event of Default is deemed to exist and continue so long as, but only as long as, it has not been remedied or explicitly waived: (a) Company fails to make any payment of principal amount of, Make-Whole Amount, if any, or interest on, any Equipment Note within 15 days after such payment is due; (b) Company fails to make payment when the same is due of any amount (other than amounts referred to in Section 4.01(a)) due hereunder, under any Equipment Note or under any other Operative Document, and such failure continues unremedied for 30 days after the receipt by Company of written notice thereof from Loan Trustee or any Noteholder; (c) Company fails to carry and maintain insurance or indemnity on or with respect to the Aircraft in accordance with the provisions of Section 7.06; provided that no such failure to carry and maintain insurance shall constitute an Event of Default until the earlier of (i) the date such failure has continued unremedied for a period of 30 days after receipt by Loan Trustee of the notice of cancellation or lapse referred to in Section 7.06 or (ii) the date such insurance is not in effect as to Loan Trustee; (d) Company fails to perform or observe any other covenant, condition or agreement to be performed or observed by it under any Operative Document, and such failure continues unremedied for a period of 60 days after receipt by Company of written notice thereof from Loan Trustee or any Noteholder; provided that, if such failure is capable of being remedied, no such failure shall constitute an Event of Default for a period of one year after such notice is received by Company so long as Company is diligently proceeding to remedy such failure; (e) any representation or warranty made by Company in any Operative Document was incorrect in any material respect at the time made, and such incorrectness continues to be material to the transactions contemplated hereby and continues unremedied for a period of 60 days after receipt by Company of written notice thereof from Loan Trustee; provided that, if such incorrectness is capable of being remedied, no such incorrectness shall constitute an Event of Default for a period of one year after such notice is received by Company so long as Company is diligently proceeding to remedy such incorrectness; (f) Company consents to the appointment of or the taking of possession by a receiver, trustee or liquidator in respect of a substantial part of its property, admits in writing its inability to pay its debts generally as they come due or makes a general assignment for the benefit of its creditors; (g) Company files a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief as a debtor in a case under any bankruptcy laws or insolvency laws (as in effect at such time) or an answer admitting the material allegations of a petition filed against Company as a debtor in any such case, or Company as a debtor seeks 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 Company seeks an agreement, composition, extension or adjustment with its creditors under such laws; (h) an order, judgment or decree is entered by any court of competent jurisdiction appointing, without the consent of Company, a receiver, trustee or liquidator of Company or sequestering any substantial part of its property, or granting any other relief in respect of Company as a debtor under any bankruptcy laws or insolvency laws (as in effect at such time), and any such order, judgment or decree of appointment or sequestration remains in force undismissed, unstayed or unvacated for a period of 90 days after the date of entry thereof; or (i) a petition against Company as a debtor in a case under the federal bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within 90 days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of corporations that may apply to Company, any court of competent jurisdiction assumes jurisdiction, custody or control of Company or of any substantial part of its property and such jurisdiction, custody or control remains in force unrelinquished, unstayed or unterminated for a period of 90 days; provided, however, that notwithstanding anything to the contrary contained in this Section 4.01, any failure of Company to perform or observe any covenant, condition or agreement shall not constitute an Event of Default if such failure arises by reason of an event referred to in the definition of "Event of Loss" so long as Company is continuing to comply with all of the terms of Section 7.05. Section 4.02 Remedies. (a) If an Event of Default has occurred and is continuing and so long as the same shall continue unremedied, then and in every such case Loan Trustee may, and upon the written instructions of a Majority in Interest of Noteholders, Loan Trustee shall, do one or more of the following to the extent permitted by, and subject to compliance with the requirements of, applicable law then in effect (provided, however, that during any period the Airframe or any Engine is subject to the CRAF Program and is in possession of or being operated under the direction of the United States government or an agency or instrumentality of the United States, Loan Trustee shall not, on account of any Event of Default, be entitled to exercise or pursue any of the powers, rights or remedies described in this Section 4.02 in such manner as to limit Company's control under this Indenture (or any Permitted Lessee's control under any Lease) of the Airframe or such Engine, unless at least 60 days' (or such lesser period as may then be applicable under the Military Airlift Command Program of the United States government) prior written notice of default hereunder has been given by Loan Trustee by registered or certified mail to Company (and any such Permitted Lessee) with a copy addressed to the Contracting Office Representative or other appropriate person for the Military Airlift Command of the United States Air Force under any contract with Company (or such Permitted Lessee) relating to the Aircraft): (i) declare by written notice to Company all the Equipment Notes to be due and payable, whereupon the aggregate unpaid principal amount of all Equipment Notes then outstanding, together with accrued but unpaid interest thereon and other amounts due thereunder (but without Make-Whole Amount), shall immediately become due and payable without presentment, demand, protest or notice, all of which are hereby waived; provided that if an Event of Default referred to in Subsections 4.01(f), (g), (h) or (i) has occurred and is continuing, then and in every such case the unpaid principal amount then outstanding, together with accrued but unpaid interest and all other amounts due thereunder (but without Make-Whole Amount) shall immediately and without further act become due and payable without presentment, demand, protest or other notice, all of which are hereby waived; and, following such declaration or deemed declaration: (ii) (A) cause Company, upon the demand by notice of Loan Trustee, at Company's expense, to deliver promptly, and Company shall deliver promptly, all or such part of the Airframe or any Engine as Loan Trustee so demands to Loan Trustee or its order, or, if Company has failed to so deliver the Airframe or any Engine after such demand, Loan Trustee, at its option, may enter upon the premises where all or any part of the Airframe or any Engine are located and take immediate possession of and remove the same together with any engine which is not an Engine but which is installed on the Airframe, subject to all of the rights of the owner, lessor, lienor or secured party of such engine; provided that the Airframe with an engine (which is not an Engine) installed thereon may be flown or returned only to a location within the continental United States, and such engine shall be held for the account of any such owner, lessor, lienor, secured party or, if such engine is owned by Company, may at the option of Company with the consent of Loan Trustee (which will not be unreasonably withheld) or at the option of Loan Trustee with the consent of Company (which will not be unreasonably withheld), be exchanged with Company for an Engine in accordance with the provisions of Section 7.05(b); (B) sell all or any part of the Airframe and any Engine at public or private sale, whether or not Loan Trustee at the time has possession thereof, as Loan Trustee may determine, or otherwise dispose of, hold, use, operate, lease to others or keep idle all or any part of the Airframe or such Engine as Loan Trustee, in its sole discretion, determines, all free and clear of any rights or claims of Company, and the proceeds of such sale or disposition shall be applied as set forth in Section 3.03; or (C) exercise any other remedy of a secured party under the Uniform Commercial Code of the State of New York (whether or not in effect in the jurisdiction in which enforcement is sought). Upon every such taking of possession of Collateral under this Section 4.02, Loan Trustee may, from time to time, at the expense of the Collateral, make all such expenditures for maintenance, insurance, repairs, alterations, additions and improvements to and of the Collateral as it deems necessary to cause the Collateral to be in such condition as required by the provisions of this Indenture. In each such case, Loan Trustee may maintain, use, operate, store, lease, control or manage the Collateral and may exercise all rights and powers of Company relating to the Collateral as Loan Trustee reasonably deems best, including the right to enter into any and all such agreements with respect to the maintenance, use, operation, storage, leasing, control, management or disposition of the Collateral or any part thereof as Loan Trustee may reasonably determine; and Loan Trustee shall be entitled to collect and receive directly all tolls, rents, revenues, issues, income, products and profits of the Collateral and every part thereof. Such tolls, rents, revenues, issues, income, products and profits shall be applied to pay the expenses of the use, operation, storage, leasing, control, management or disposition of the Collateral, and of all maintenance, repairs, replacements, alterations, additions and improvements, and to make all payments that Loan Trustee is required or elects to make, if any, for Taxes, insurance or other proper charges assessed against or otherwise imposed upon the Collateral or any part thereof, and all other payments which Loan Trustee is required or expressly authorized to make under any provision of this Indenture, as well as just and reasonable compensation for the services of Loan Trustee, and shall otherwise be applied in accordance with Article III. If an Event of Default has occurred and is continuing and the Equipment Notes either have been accelerated pursuant to this Section 4.02 or have become due at maturity and Loan Trustee is entitled to exercise rights hereunder, at the request of Loan Trustee, Company shall promptly execute and deliver to Loan Trustee such instruments of title and other documents as Loan Trustee reasonably deems necessary or advisable to enable Loan Trustee or an agent or representative designated by Loan Trustee, at such time or times and place or places as Loan Trustee specifies, to obtain possession of all or any part of the Collateral to which Loan Trustee at the time is entitled hereunder. If Company for any reason fails to execute and deliver such instruments and documents after such request by Loan Trustee, Loan Trustee may obtain a judgment conferring on Loan Trustee the right to immediate possession and requiring Company to execute and deliver such instruments and documents to Loan Trustee, to the entry of which judgment Company hereby specifically consents to the fullest extent it may lawfully do so. (b) Loan Trustee shall give Company at least 30 days' prior written notice of any public sale or of the date on or after which any private sale will be held, which notice Company hereby agrees to the extent permitted by applicable law is reasonable notice. Any Noteholder or Noteholders shall be entitled to bid for and become the purchaser of any Collateral offered for sale pursuant to this Section 4.02 and to credit against the purchase price bid at such sale by such Noteholders all or any part of the unpaid amounts owing to such Noteholders under the Operative Documents and secured by the Lien of this Indenture (but only to the extent that such purchase price would have been paid to such Noteholders pursuant to Article III if such purchase price were paid in cash and the foregoing provision of this Section 4.02(b) were not given effect). Loan Trustee may exercise such right without possession or production of the Equipment Notes or proof of ownership thereof, and as a representative of Noteholders may exercise such right without notice to Noteholders as parties to any suit or proceeding relating to the foreclosure of any Collateral. Company may also bid for and become the purchaser of any Collateral offered for sale pursuant to this Section 4.02. (c) To the extent permitted by applicable law, while an Event of Default has occurred and is continuing, Company irrevocably appoints Loan Trustee the true and lawful attorney-in-fact of Company (which appointment is coupled with an interest) in its name and stead and on its behalf, for the purpose of effectuating any sale, assignment, transfer or delivery for the enforcement of the Lien of this Indenture, whether pursuant to foreclosure or power of sale, or otherwise, to execute and deliver all such bills of sale, assignments and other instruments as may be necessary or appropriate, with full power of substitution, Company hereby ratifying and confirming all that such attorney or any substitute does by virtue hereof in accordance with applicable law; provided that if so requested by Loan Trustee or any purchaser, Company shall ratify and confirm any such sale, assignment or transfer of delivery, by executing and delivering to Loan Trustee or such purchaser all bills of sale, assignments, releases and other proper instruments to effect such ratification and confirmation as may be designated in any such request. (d) At any time after Loan Trustee has declared the unpaid principal amount of all Equipment Notes then outstanding to be due and payable and prior to the sale of any part of the Collateral pursuant to this Article IV, a Majority in Interest of Noteholders, by written notice to Company and Loan Trustee, may rescind and annul such declaration, whether made by Loan Trustee on its own accord or as directed, and its consequences if: (i) there has been paid to or deposited with Loan Trustee an amount sufficient to pay all overdue installments of principal amount of, and interest on, the Equipment Notes, and all other amounts owing under the Operative Documents, that have become due otherwise than by such declaration of acceleration and (ii) all other Events of Default, other than nonpayment of principal amount or interest on the Equipment Notes that have become due solely because of such acceleration, have been either cured or waived. (e) Notwithstanding anything contained herein, so long as Pass Through Trustee under any Pass Through Trust Agreement or Subordination Agent on its behalf is a Noteholder, Loan Trustee will not be authorized or empowered to acquire title to any Collateral or take any action with respect to any Collateral so acquired by it if such acquisition or action would cause any Pass Through Trust to fail to qualify as a "grantor trust" for federal income tax purposes. Section 4.03 Remedies Cumulative. To the extent permitted under applicable law, each and every right, power and remedy specifically given to Loan Trustee herein or otherwise in this Indenture shall be cumulative and shall be in addition to every other right, power and remedy specifically given herein or now or hereafter existing at law, in equity or by statute, and each and every right, power and remedy whether specifically given herein or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by Loan Trustee, 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 Loan Trustee in the exercise of any right, remedy or power or in the pursuance of any remedy shall, to the extent permitted by applicable law, impair any such right, power or remedy or be construed to be a waiver of any default on the part of Company or to be an acquiescence therein. Section 4.04 Discontinuance of Proceedings. In case Loan Trustee has instituted any proceedings to enforce any right, power or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings have been discontinued or abandoned for any reason or have been determined adversely to Loan Trustee, then and in every such case Company and Loan Trustee shall, subject to any determination in such proceedings, be restored to their former positions and rights hereunder with respect to the Collateral, and all rights, remedies and powers of Loan Trustee shall continue as if no such proceedings had been undertaken (but otherwise without prejudice). Section 4.05 Waiver of Past Defaults. Upon written instruction from a Majority in Interest of Noteholders, Loan Trustee shall waive any past default hereunder and its consequences, and upon any such waiver such default shall cease to exist and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of the Operative Documents, but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon; provided, however, that in the absence of written instructions from each of the affected Noteholders, Loan Trustee shall not waive any default (i) in the payment of the principal amount, Make-Whole Amount, if any, or interest due under any Equipment Note then outstanding (other than with the consent of the holder thereof), or (ii) in respect of a covenant or provision hereof which, under Article IX, cannot be modified or amended without the consent of each such affected Noteholder. Section 4.06 Noteholders May Not Bring Suit Except Under Certain Conditions. A Noteholder of any Series shall not have the right to institute any suit, action or proceeding at law or in equity or otherwise with respect to this Indenture for the appointment of a receiver or for the enforcement of any other remedy under this Indenture, unless: (1) such Noteholder previously shall have given written notice to Loan Trustee of a continuing Event of Default; (2) A Majority in Interest of Noteholders shall have requested Loan Trustee in writing to institute such action, suit or proceeding and shall have offered to Loan Trustee indemnity as provided in Section 5.03; (3) Loan Trustee shall have refused or neglected to institute any such action, suit or proceeding for 60 days after receipt of such notice, request and offer of indemnity; and (4) no direction inconsistent with such written request shall have been given to Loan Trustee during such 60-day period by a Majority in Interest of Noteholders. Except to the extent provided in the Intercreditor Agreement or in any Indenture Supplement, it is understood and intended that no one or more of Noteholders of any Series shall have any right in any manner whatsoever hereunder or under the Indenture Supplement or under the Equipment Notes of such Series to (i) surrender, impair, waive, affect, disturb or prejudice any Collateral, or the Lien of the Indenture on any Collateral, or the rights of Noteholders of such Series, (ii) obtain or seek to obtain priority over or preference with respect to any other such Noteholder of such Series or (iii) enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal, ratable and common benefit of all Noteholders of such Series subject to the provisions of this Indenture. ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Event of Default. If Loan Trustee has knowledge of an Event of Default or of a default arising from a failure by Company to pay when due any payment of principal amount, interest or Make-Whole Amount, if any, due and payable under any Equipment Note, Loan Trustee shall promptly give notice thereof to Company and each Noteholder; provided, however, that except in the case of a default in the payment of the principal amount, interest or Make-Whole Amount, if any, due and payable under any Equipment Note, Loan Trustee shall be protected in withholding the notice to Noteholders required in the foregoing part of this sentence if and so long as the executive committee or trust committee of directors of Loan Trustee and/or trust officers thereof in good faith determine that withholding such notice is in the interest of Noteholders. Subject to the terms of Sections 4.02, 4.05, 5.02 and 5.03, Loan Trustee shall take such action, or refrain from taking such action, with respect to such Event of Default (including with respect to the exercise of any rights or remedies hereunder) as Loan Trustee is instructed in writing by a Majority in Interest of Noteholders. Subject to the provisions of Section 5.03, if Loan Trustee does not receive instructions as above provided within 20 Business Days after giving notice of such Event of Default to Noteholders, Loan Trustee may, subject to instructions thereafter received pursuant to the preceding provisions of this Section 5.01, take such action, or refrain from taking such action with respect to such Event of Default as it reasonably determines to be advisable in the best interests of Noteholders, but shall be under no duty to take or refrain from taking any action. It shall use the same degree of care and skill in connection therewith as a prudent person would use under the circumstances in the conduct of his or her own affairs. Loan Trustee may not sell the Airframe or any Engine without the consent of a Majority in Interest of Noteholders. For all purposes of this Indenture, in the absence of actual knowledge, Loan Trustee shall not be deemed to have knowledge of a default or an Event of Default unless notified in writing by Company or one or more Noteholders; and "actual knowledge" (as used in the foregoing clause) of Loan Trustee shall mean actual knowledge of an officer in the Corporate Trust Division of Loan Trustee; provided, however, that Loan Trustee is deemed to have actual knowledge of (i) the failure of Company to pay any principal amount of, or interest on, the Equipment Notes directly to Loan Trustee when the same shall become due or (ii) the failure of Company to maintain insurance as required under Section 7.06 if Loan Trustee receives written notice thereof from an insurer or insurance broker. Section 5.02 Action upon Instructions; Certain Rights and Limitations. Subject to the terms of Article IV and this Article V, upon the written instructions at any time of a Majority in Interest of Noteholders, Loan Trustee shall promptly (i) give such notice, direction, consent, waiver or approval or exercise such right, remedy or power hereunder in respect of all or any part of the Collateral or (ii) take such other action, as is specified in such instructions. Loan Trustee will cooperate with Company in connection with the recording, filing, re-recording and refiling of the Indenture and any supplements to it and any financing statements or other documents as is necessary to maintain the perfection hereof or otherwise protect the security interests created hereby. Loan Trustee shall furnish to Company upon request such information and copies of such documents as Loan Trustee may have and as are necessary for Company to perform its duties under Article II hereof. Section 5.03 Indemnification. Loan Trustee shall not be required to take any action or refrain from taking any action under Sections 5.01 (other than the first sentence thereof) or 5.02 or Article IV unless it shall have received indemnification against any risks incurred in connection therewith in form and substance reasonably satisfactory to it, including, without limitation, adequate advances against costs that may be incurred by it in connection therewith. Loan Trustee shall not be required to take any action under Section 5.01 (other than the first sentence thereof) or 5.02 or Article IV, nor shall any other provision of any Operative Document be deemed to impose a duty on Loan Trustee to take any action, if Loan Trustee shall have been advised by outside counsel that such action is contrary to the terms hereof or is otherwise contrary to law. Section 5.04 No Duties Except as Specified in Indenture or Instructions. Loan Trustee shall not have any duty or obligation to manage, control, lease, use, sell, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Collateral, or to otherwise take or refrain from taking any action under, or in connection with, this Indenture, except as expressly provided by the terms of this Indenture or the Participation Agreement or as expressly provided in written instructions received pursuant to the terms of Section 5.01 or 5.02; and no implied duties or obligations shall be read into this Indenture against Loan Trustee. Section 5.05 No Action Except under Indenture or Instructions. Loan Trustee will not manage, control, use, sell, lease, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Collateral except in accordance with the powers granted to, or the authority conferred upon, Loan Trustee pursuant to this Indenture and in accordance with the express terms hereof. Section 5.06 Investment of Amounts Held by Loan Trustee. Any monies (including for the purpose of this Section 5.06 any cash deposited with Loan Trustee by Company, any cash received by Loan Trustee pursuant to Sections 7.05(c) or 7.06(d) or otherwise) or Permitted Investments purchased by the use of such cash pursuant to this Section 5.06 or any cash constituting the proceeds of the maturity, sale or other disposition of any Permitted Investments) held by Loan Trustee hereunder as part of the Collateral, until paid out by Loan Trustee as herein provided, (i) subject to clause (ii) below, may be carried by Loan Trustee on deposit with itself or on deposit to its account with any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of a least $100,000,000, and Loan Trustee shall not have any liability for interest upon any such monies except as otherwise agreed in writing with Company, or (ii) at any time and from time to time, so long as no Event of Default shall have occurred and be continuing, at the request of Company, shall be invested and reinvested in Permitted Investments as specified in such request (if such investments are reasonably available for purchase) and sold, in any case at such prices, including accrued interest or its equivalent, as are set forth in such request, and such Permitted Investments shall be held by Loan Trustee in trust as part of the Collateral until so sold; provided that Company shall upon demand pay to Loan Trustee the amount of any loss realized upon maturity, sale or other disposition of any such Permitted Investment and, so long as no Event of Default or Payment Default shall have occurred and be continuing, Company shall be entitled to receive from Loan Trustee, and Loan Trustee shall promptly pay to Company, any profit, income, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment. If an Event of Default or Payment Default shall have occurred and be continuing, any net income, profit, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment shall be held as part of the Collateral and shall be applied by Loan Trustee at the same time, on the same conditions and in the same manner as the amounts in respect of which such income, profit, interest, dividend or gain was realized are required to be distributed in accordance with the provisions hereof pursuant to which such amounts were required to be held. Loan Trustee shall not be responsible for any losses on any investments or sales of Permitted Investments made pursuant to the procedure specified in this Section 5.06 other than by reason of its willful misconduct or negligence. If any moneys or investments are held by Loan Trustee solely because an Event of Default has occurred and is continuing and such moneys or investments have been held for a period of 90 consecutive days during which such Event of Default is continuing without any remedial action being taken by Loan Trustee in respect of such Event of Default pursuant to Section 4.02 hereof, and provided that there is no stay, moratorium or injunction in effect preventing the taking of such action, then, notwithstanding any other provision of the Operative Documents, all such moneys and investments held by Loan Trustee shall be released to Company on such 90th day, or on the next Business Day after such 90th day. ARTICLE VI LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties. State Street accepts the trusts and duties hereby created and applicable to it and agrees to perform such duties, but only upon the terms of this Indenture and agrees to receive, handle and disburse all monies received by it as Loan Trustee constituting part of the Collateral in accordance with the terms hereof. State Street shall have no liability hereunder except (a) for its own willful misconduct or negligence, (b) as provided in the fourth sentence of Section 2.03 and the penultimate sentence of Section 5.06, (c) for liabilities that may result from the inaccuracy of any representation or warranty of State Street in the Participation Agreement or expressly made hereunder and (d) as otherwise expressly provided in the Operative Documents. Section 6.02 Absence of Certain Duties. Except in accordance with written instructions furnished pursuant to Sections 5.01, 5.02 or 6.06, and except as provided in, and without limiting the generality of, Sections 5.02, 5.03 and 5.04, Loan Trustee shall have no duty (a) to see to any registration of the Aircraft or any recording or filing of this Indenture or any other document, or to see to the maintenance of any such registration, recording or filing, (b) to see to any insurance on the Aircraft or to effect or maintain any such insurance, whether or not Company is in default with respect thereto, (c) to confirm, verify or inquire into the failure to receive any financial statements of Company or (d) to inspect the Aircraft at any time or ascertain or inquire as to the performance or observance of any of Company's covenants hereunder with respect to the Aircraft. Section 6.03 No Representations or Warranties as to the Documents. Except as provided in Article 5 of the Participation Agreement, Loan Trustee shall not be deemed to have made any representation or warranty as to the validity, legality or enforceability of any Operative Document or any other document or instrument, or as to the correctness of any statement (other than a statement by Loan Trustee) contained herein or therein, except that Loan Trustee hereby represents and warrants that each of said specified documents to which it is a party has been or will be duly executed and delivered by one of its officers who is and will be duly authorized to execute and deliver such document on its behalf. Section 6.04 No Segregation of Monies; No Interest. Subject to Section 5.06 hereof, all moneys received by Loan Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by mandatory provisions of law, and neither Loan Trustee nor any agent of Loan Trustee shall be under any liability for interest on any moneys received by it hereunder; provided, however, that any payments received, or applied hereunder, by Loan Trustee shall be accounted for by Loan Trustee so that any portion thereof paid or applied pursuant hereto shall be identifiable as to the source thereof. Section 6.05 Reliance; Agents; Advice of Counsel. Loan Trustee shall not incur any liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. Loan Trustee may accept a copy of a resolution of the Board of Directors of any party to the Participation Agreement, certified by the Secretary or an Assistant Secretary of such party as duly adopted and in full force and effect, as conclusive evidence that such resolution has been duly adopted and that the same is in full force and effect. As to any fact or matter the manner of ascertainment of which is not specifically described herein, Loan Trustee may for all purposes hereof rely on a certificate, signed by a duly authorized officer of Company, as to such fact or matter, and such certificate shall constitute full protection to Loan Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. In the administration of the trusts hereunder, Loan Trustee may, with the consent of Company (such consent not to be unreasonably withheld), (a) execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents (including paying agents or registrars) or attorneys, and (b) at the expense of the Collateral, consult with counsel, accountants and other skilled Persons to be selected and retained by it. Loan Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled Persons acting within such counsel's, accountants' or Person's area of competence (so long as Loan Trustee shall have exercised reasonable care and judgment in selecting such Persons). Section 6.06 Instructions from Noteholders. In the administration of the trusts created hereunder, Loan Trustee shall have the right to seek instructions from a Majority in Interest of Noteholders should any provision of this Indenture appear to conflict with any other provision herein or any other Operative Document or Pass Through Document or should Loan Trustee's duties or obligations hereunder be unclear, and Loan Trustee shall incur no liability in refraining from acting until it receives such instructions. Loan Trustee shall be fully protected for acting in accordance with any instructions received under this Section 6.06. ARTICLE VII OPERATING COVENANTS OF COMPANY Section 7.01 Liens. Company will not directly or indirectly create, incur, assume or suffer to exist any Lien on or with respect to the Aircraft, its title thereto or any of its interest therein, except: (a) the respective rights of Loan Trustee and Company as provided in the Operative Documents, the Lien of this Indenture, the rights of any Permitted Lessee under a Lease permitted hereunder and the rights of any Person existing pursuant to the Operative Documents or the Pass Through Documents; (b) the rights of others under agreements or arrangements to the extent expressly permitted by this Indenture; (c) Loan Trustee Liens, Noteholder Liens and Other Party Liens; (d) Liens for Taxes either not yet due or payable or being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Loan Trustee's interest therein or materially impair the Lien of this Indenture; (e) materialmen's, mechanics', workers', repairmen's, employees' or other like Liens arising in the ordinary course of business (including those arising under maintenance agreements entered into in the ordinary course of business) securing obligations that either are not yet overdue for a period of more than 60 days or are being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Loan Trustee's interest therein or materially impair the Lien of this Indenture; (f) Liens arising out of any judgment or award, so long as such judgment is, within 60 days after the entry thereof, discharged, vacated or reversed, or execution thereof stayed pending appeal or other judicial review or is discharged, vacated or reversed within 60 days after the expiration of such stay; (g) any other Lien with respect to which Company provides a bond, cash collateral or other security adequate in the reasonable opinion of Loan Trustee; (h) salvage or similar rights of insurers under insurance policies maintained by Company; and (i) Liens approved in writing by Loan Trustee with the consent of a Majority in Interest of Noteholders. Liens described in clauses (a) through (i) above are referred to herein as "Permitted Liens". Company shall promptly, at its own expense, take (or cause to be taken) such action as may be necessary duly to discharge (by bonding or otherwise) any Lien other than a Permitted Lien arising at any time with respect to the Aircraft, its title thereto or any of its interest therein. Section 7.02 Possession, Operation and Use, Maintenance and Registration. (a) Possession. Without the prior written consent of Loan Trustee, Company shall not lease or otherwise in any manner deliver, transfer or relinquish possession of the Airframe or any Engine or install any Engine, or permit any Engine to be installed, on any airframe other than the Airframe; provided that Company (or, except with respect to clauses (viii) and (ix) below, any Permitted Lessee) may without the prior written consent of Loan Trustee: (i) subject the Airframe to interchange agreements or subject any Engine to interchange or pooling agreements or arrangements, in each case entered into by Company (or any Permitted Lessee) in the ordinary course of its business; provided that (A) no such agreement or arrangement contemplates or requires the transfer of title to the Airframe and (B) if Company's title to any such Engine is divested under any such agreement or arrangement, such divestiture shall be deemed to be an Event of Loss with respect to such Engine, and Company shall (or shall cause any Permitted Lessee to) comply with Section 7.05(b) in respect thereof; (ii) deliver possession of the Airframe or any Engine to any Person for testing, service, repair, restoration, storage, maintenance or other similar purposes or for alterations, modifications or additions to the Airframe or such Engine to the extent required or permitted by the terms hereof; (iii) transfer or permit the transfer of possession of the Airframe or any Engine to any Government pursuant to a lease, contract or other instrument; (iv) subject (or permit any Permitted Lessee to subject) the Airframe or any Engine to the CRAF Program or transfer (or permit any Permitted Lessee to transfer) possession of the Airframe or any Engine to the United States government in accordance with applicable laws, rulings, regulations or orders (including, without limitation, any transfer of possession pursuant to the CRAF Program); provided, that Company (or any Permitted Lessee) (A) shall promptly notify Loan Trustee upon transferring possession of the Airframe or any Engine pursuant to this clause (iv) and (B) in the case of a transfer of possession pursuant to the CRAF Program, shall notify Loan Trustee of the name and address of the responsible Contracting Office Representative for the Military Airlift Command of the United States Air Force or other appropriate Person to whom notices must be given and to whom requests or claims must be made to the extent applicable under the CRAF Program; (v) install an Engine on an airframe owned by Company (or any Permitted Lessee) free and clear of all Liens, except (A) Permitted Liens and Liens that apply only to the engines (other than Engines), appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment (other than Parts) installed on such airframe (but not to the airframe as an entirety) and (B) the rights of third parties under interchange agreements or pooling or similar arrangements that would be permitted under clause (i) above; (vi) install an Engine on an airframe leased to Company (or any Permitted Lessee) or purchased or owned by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement; provided that: (A) such airframe is free and clear of all Liens except (1) the rights of the parties to the lease or conditional sale or other security agreement covering such airframe, or their successors and assigns, and (2) Liens of the type permitted by clause (v) of this Section 7.02(a); and (B) either: (1) Company has obtained from the lessor or secured party of such airframe a written agreement (which may be the lease, conditional sale or other security agreement covering such airframe), in form and substance satisfactory to Loan Trustee (an agreement from such lessor or secured party substantially in the form of the penultimate paragraph of this Section 7.02(a) being deemed to be satisfactory to Loan Trustee), whereby such lessor or secured party expressly agrees that neither it nor its successors or assigns will acquire or claim any right, title or interest in any Engine by reason of such Engine being installed on such airframe at any time while such Engine is subject to the Lien of this Indenture, or (2) such lease, conditional sale or other security agreement provides that such Engine shall not become subject to the Lien of such lease, conditional sale or other security agreement at any time while such Engine is subject to the Lien of this Indenture, notwithstanding its installation on such airframe; (vii) install an Engine on an airframe owned by Company (or any Permitted Lessee), leased to Company (or any Permitted Lessee) or purchased by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement under circumstances where neither clause (v) nor clause (vi) of this Section 7.02(a) is applicable; provided that such installation shall be deemed an Event of Loss with respect to such Engine, and Company shall comply with Section 7.05(b) in respect thereof, if such installation adversely affects Loan Trustee's security interest in such Engine, Loan Trustee not intending hereby to waive any right or interest it may have to or in such Engine under applicable law until compliance by Company with Section 7.05(b); (viii) lease any Engine or the Airframe and Engines to any United States air carrier as to which there is in force a certificate issued pursuant to the Transportation Code (49 U.S.C. Sections 41101-41112) or successor provision that gives like authority; and (ix) lease any Engine or the Airframe and Engines to (A) any foreign air carrier other than those set forth in clause (B), (B) any foreign air carrier that is at the inception of the lease based in and a domiciliary of a country listed in Exhibit B hereto, (C) the manufacturer of the Airframe or any Engine (either directly or through an affiliate) and (D) any foreign air carrier consented to in writing by Loan Trustee with the consent of a Majority in Interest of Noteholders; provided that (x) in the case of a lease to a foreign air carrier under clause (A) above, Loan Trustee receives at the time of such lease (1) written confirmation from each of the Rating Agencies that such lease would not result in a reduction of the rating for any class of Pass Through Certificates below the then current rating for such class of Pass Through Certificates or a withdrawal or suspension of the rating of any class of Pass Through Certificates, without regard to the Policy (as defined in the Policy Provider Agreement) and (2) an opinion of counsel to Company (such counsel to be reasonably satisfactory to Loan Trustee) to the effect that there exist no possessory rights in favor of the lessee under the laws of such lessee's country which would, upon bankruptcy or insolvency of or other default by Company and assuming at such time such lessee is not insolvent or bankrupt, prevent the taking of possession of any such Engine or the Airframe and any such Engine by Loan Trustee in accordance with and when permitted by the terms of Section 4.02 upon the exercise by Loan Trustee of its remedies under Section 4.02, (y) in the case of a lease to any foreign air carrier (other than a foreign air carrier principally based in Taiwan), the United States maintains diplomatic relations with the country in which such foreign air carrier is based at the time such lease is entered into and (z) in the case of any lease to a foreign air carrier, such carrier is not then subject to any bankruptcy, insolvency, liquidation, reorganization, dissolution or similar proceeding and shall not have substantially all of its property in the possession of any liquidator, trustee, receiver or similar person; provided that the rights of any lessee or other transferee who receives possession of the Aircraft, the Airframe or any Engine by reason of a transfer permitted by this Section 7.02(a) (other than the transfer of an Engine which is deemed an Event of Loss) shall be subject and subordinate to, and any permitted lease shall be made expressly subject and subordinate to, all the terms of this Indenture, including Loan Trustee's rights to repossess pursuant to Section 4.02 and to avoid such lease upon such repossession, and Company shall remain primarily liable hereunder for the performance and observance of all of the terms and conditions of this Indenture to the same extent as if such lease or transfer had not occurred, any such lease shall include appropriate provisions for the maintenance and insurance of the Aircraft, the Airframe or such Engine, and no lease or transfer of possession otherwise in compliance with this Section shall (x) result in any registration or re-registration of the Aircraft except to the extent permitted in Section 7.02(e) or the maintenance, operation or use thereof that does not comply with Section 7.02(b) and (c) or (y) permit any action not permitted to be taken by Company with respect to the Aircraft hereunder. Company shall promptly notify Loan Trustee and the Rating Agencies of the existence of any such lease with a term in excess of one year. Loan Trustee, and each Noteholder by acceptance of an Equipment Note, agrees, for the benefit of Company (and any Permitted Lessee) and for the benefit of the lessor or secured party of any airframe or engine leased to Company (or any Permitted Lessee) or purchased or owned by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement, that Loan Trustee and Noteholders will not acquire or claim, as against Company (or any Permitted Lessee) or such lessor or secured party, any right, title or interest in: (A) any engine or engines owned by Company (or any Permitted Lessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of such engine or engines being installed on the Airframe, or (B) any airframe owned by Company (or any Permitted Lessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of any Engine being installed on such airframe. Loan Trustee acknowledges that any "wet lease" or other similar arrangement under which Company (or any Permitted Lessee) maintains operational control of the Aircraft does not constitute a delivery, transfer or relinquishment of possession for purposes of this Section 7.02(a). (b) Operation and Use. Company agrees that the Aircraft will not be maintained, used or operated in violation of any law, rule or regulation of any government of any country having jurisdiction over the Aircraft or in violation of any airworthiness certificate, license or registration relating to the Aircraft issued by any such government, except to the extent Company (or, if a Lease is then in effect, any Permitted Lessee) is contesting in good faith the validity or application of any such law, rule or regulation in any manner that does not involve any material risk of sale, forfeiture or loss of the Aircraft or materially impair the Lien of this Indenture; provided, that Company shall not be in default under, or required to take any action set forth in, this sentence if it is not possible for it to comply with the laws of a jurisdiction other than the United States (or other than any jurisdiction in which the Aircraft is then registered) because of a conflict with the applicable laws of the United States (or such jurisdiction in which the Aircraft is then registered). Company will not operate the Aircraft, or permit the Aircraft to be operated or located, (i) in any area excluded from coverage by any insurance required by the terms of Section 7.06 or (ii) in any war zone or recognized or, in Company's judgment, threatened areas of hostilities unless covered by war risk insurance in accordance with Section 7.06, unless in the case of either clause (i) or (ii), (x) indemnification complying with Section 7.06 (a) and (b) has been provided or (y) the Aircraft is only temporarily located in such area as a result of an isolated occurrence or isolated series of occurrences attributable to a hijacking, medical emergency, equipment malfunction, weather conditions, navigational error or other similar unforeseen circumstances and Company is using its good faith efforts to remove the Aircraft from such area as promptly as practicable. (c) Maintenance. Company shall maintain, service, repair and overhaul the Aircraft (or cause the same to be done) so as to keep the Aircraft in good operating condition and in such condition as may be necessary to enable the airworthiness certification of the Aircraft to be maintained in good standing at all times (other than during temporary periods of storage, during maintenance, testing or modification permitted hereunder, or during periods of grounding by applicable governmental authorities) under the Transportation Code, during such periods in which the Aircraft is registered under the laws of the United States, or, if the Aircraft is registered under the laws of any other jurisdiction, the applicable laws of such jurisdiction. In any case, the Aircraft will be maintained in accordance with the maintenance standards required by the FAA (while operated under an FAA-approved maintenance program) or, while operated under the maintenance program of another jurisdiction, standards substantially equivalent to those required by the central aviation authority of Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Spain, Sweden, Switzerland or the United Kingdom. Company shall maintain or cause to be maintained all records, logs and other documents required to be maintained in respect of the Aircraft by appropriate authorities in the jurisdiction in which the Aircraft is registered. (d) Identification of Loan Trustee's Interest. Company agrees to affix as promptly as practicable after the Closing Date and thereafter to maintain in the cockpit of the Aircraft, in a clearly visible location, and (if not prevented by applicable law or regulations or by any government) on each Engine, a nameplate bearing the inscription "MORTGAGED TO STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, AS LOAN TRUSTEE" (such nameplate to be replaced, if necessary, with a nameplate reflecting the name of any successor Loan Trustee). (e) Registration. Company shall cause the Aircraft to remain duly registered, under the laws of the United States, in the name of Company except as otherwise required by the Transportation Code; provided that Loan Trustee shall, at Company's expense, execute and deliver all such documents as Company may reasonably request for the purpose of continuing such registration. Notwithstanding the preceding sentence, Company, at its own expense, may cause or allow the Aircraft to be duly registered under the laws of any foreign jurisdiction in which a Permitted Lessee could be principally based, in the name of Company or of any nominee of Company, or, if required by applicable law, in the name of any other Person (and, following any such foreign registration, may cause the Aircraft to be re-registered under the laws of the United States); provided, that in the case of jurisdictions other than those approved by Loan Trustee with the consent of a Majority in Interest of Noteholders (i) if such jurisdiction is at the time of registration listed on Exhibit B, Loan Trustee shall have received at the time of such registration an opinion of counsel to Company to the effect that (A) this Indenture and Loan Trustee's right to repossession thereunder is valid and enforceable under the laws of such country, (B) after giving effect to such change in registration, the Lien of this Indenture shall continue as a valid Lien and shall be duly perfected in the new jurisdiction of registration and that all filing, recording or other action necessary to perfect and protect the Lien of this Indenture has been accomplished (or if such opinion cannot be given at such time, (x) the opinion shall detail what filing, recording or other action is necessary and (y) Loan Trustee shall have received a certificate from a Responsible Officer of Company that all possible preparations to accomplish such filing, recording and other action shall have been done, and such filing, recording and other action shall be accomplished and a supplemental opinion to that effect shall be promptly delivered to Loan Trustee subsequent to the effective date of such change in registration), (C) the obligations of Company under this Indenture shall remain valid, binding and (subject to customary bankruptcy and equitable remedies exceptions and to other exceptions customary in foreign opinions generally) enforceable under the laws of such jurisdiction (or the laws of the jurisdiction to which the laws of such jurisdiction would refer as the applicable governing law) and (D) all approvals or consents of any government in such jurisdiction having jurisdiction required for such change in registration shall have been duly obtained and shall be in full force and effect, and (ii) if such jurisdiction is at the time of registration not listed on Exhibit B, Loan Trustee shall have received (in addition to the opinions set forth in clause (i) above) at the time of such registration an opinion of counsel to Company to the effect that (A) the terms of this Indenture are legal, valid, binding and enforceable in such jurisdiction (subject to exceptions customary in such jurisdiction, provided, that, subject to exceptions relating to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and exceptions relating to general principles of equity, such counsel shall opine that any applicable laws limiting the remedies provided in Section 4.02 do not in the opinion of such counsel make the remedies provided in Section 4.02 inadequate for the practical realization of the rights and benefits provided thereby), (B) that it is not necessary for Loan Trustee to register or qualify to do business in such jurisdiction, (C) that there is no tort liability of the lender of an aircraft not in possession thereof under the laws of such jurisdiction other than tort liability that might have been imposed on such lender under the laws of the United States or any state thereof (it being understood that such opinion shall be waived if insurance reasonably satisfactory to Loan Trustee is provided, at Company's expense, to cover such risk) and (D) (unless Company shall have agreed to provide insurance covering the risk of requisition of use or title of the Aircraft by the government of such jurisdiction so long as the Aircraft is registered under the laws of such jurisdiction) that the laws of such jurisdiction require fair compensation by the government of such jurisdiction payable in currency freely convertible into Dollars for the loss of use or title of the Aircraft in the event of requisition by such government of such use or title. Loan Trustee will cooperate with Company in effecting such foreign registration. Notwithstanding the foregoing, prior to any such change in the country of registry of the Aircraft, the following conditions shall be met (or waived as provided in Section 6.01(b) of the Participation Agreement): (i) no Event of Default shall have occurred and be continuing at the effective date of the change in registration; provided, that it shall not be necessary to comply with this condition if the change in registration results in the registration of the Aircraft under the laws of the United States or if a Majority in Interest of Noteholders consents to such change in registration; (ii) Loan Trustee shall have received evidence of compliance with the insurance provisions contained herein after giving effect to such change in registration; and (iii) Company shall have paid or made provision reasonably satisfactory to Loan Trustee for the payment of all reasonable expenses (including reasonable attorneys' fees) of Loan Trustee and Noteholders in connection with such change in registration. Section 7.03 Inspection; Financial Information. (a) Inspection. At all reasonable times, but upon at least 15 Business Days' prior written notice to Company, Policy Provider or Loan Trustee or their respective authorized representatives may, subject to the other conditions of this Section 7.03(a), inspect the Aircraft and may inspect the books and records of Company relating to the maintenance of the Aircraft required to be maintained by the FAA or the government of another jurisdiction in which the Aircraft is then registered; provided, that (i) Policy Provider or Loan Trustee or their respective representatives, as the case may be, shall be fully insured at no cost to Company in a manner satisfactory to Company with respect to any risks incurred in connection with any such inspection or shall provide to Company a written release satisfactory to Company with respect to such risks, (ii) any such inspection shall be during Company's normal business hours and subject to the safety, security and workplace rules applicable at the location where such inspection is conducted and any applicable governmental rules or regulations, (iii) any such inspection of the Aircraft shall be a visual, walk-around inspection of the interior and exterior of the Aircraft and shall not include opening any panels, bays or the like without Company's express consent, which consent Company may in its sole discretion withhold, and (iv) no exercise of such inspection right shall interfere with the use, operation or maintenance of the Aircraft by, or the business of, Company and Company shall not be required to undertake or incur any additional liabilities in connection therewith. All information obtained in connection with any such inspection of the Aircraft and of such books and records shall be Confidential Information and shall be treated by Policy Provider and Loan Trustee and their respective representatives in accordance with the provisions of Section 10.16. Any inspection pursuant to this Section 7.03(a) shall be at the sole risk (including, without limitation, any risk of personal injury or death) and expense of Policy Provider or Loan Trustee (or their respective representatives) making such inspection. Except during the continuance of an Event of Default, all inspections by Policy Provider and Loan Trustee and their respective representatives provided for under this Section 7.03(a) shall be limited to one inspection of any kind contemplated by this Section 7.03(a) during any consecutive twelve month period. (b) Financial Information. So long as any of the Equipment Notes remain unpaid, Company agrees to furnish to Loan Trustee, Policy Provider and Liquidity Provider: (i) within 60 days after the end of each of the first three quarterly periods in each fiscal year of Company, either (x) a consolidated balance sheet of Company and its consolidated subsidiaries prepared by it as of the close of such period, together with the related consolidated statements of income for such period or (y) a report of Company on Form 10-Q in respect of such period in the form filed with the Securities and Exchange Commission and (ii) within 120 days after the close of each fiscal year of Company, either (x) a consolidated balance sheet of Company and its consolidated subsidiaries as of the close of such fiscal year, together with the related consolidated statements of income for such fiscal year, certified by independent public accountants, or (y) a report of Company on Form 10-K in respect of such year in the form filed with the Securities and Exchange Commission. Company may fulfill the requirements of this Section 7.03(b) by providing the material described above in an electronic format by electronic mail or accessible over the Internet. Section 7.04 Replacement and Pooling of Parts; Alterations, Modifications and Additions; Substitution of Engines. (a) Replacement of Parts. Company shall promptly replace or cause to be replaced all Parts incorporated or installed in or attached to the Airframe or any Engine and that become worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use for any reason, except as otherwise provided in Section 7.04(c) or if the Airframe or an Engine to which a Part relates has suffered an Event of Loss. In addition, Company (or any Permitted Lessee) may remove in the ordinary course of maintenance, service, repair, overhaul or testing, any Parts, whether or not worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use; provided that Company (or any Permitted Lessee), except as otherwise provided in Section 7.04(c), will replace such Parts as promptly as practicable. All replacement Parts shall be free and clear of all Liens (except for Permitted Liens and except in the case of replacement property temporarily installed on an emergency basis) and shall be in the condition and repair required to be maintained by the terms hereof. Except as otherwise provided in Section 7.04(c), any Parts removed from the Airframe or any Engine shall remain subject to the Lien of this Indenture no matter where located until it is replaced by a part incorporated or installed in or attached to the Airframe or such Engine that meets the requirements for replacement Parts specified above. Immediately upon any replacement Part becoming incorporated or installed in or attached to the Airframe or any Engine as above provided (except in the case of replacement property temporarily installed on an emergency basis), without further act, (i) the replaced Part shall thereupon be free and clear of all rights of Loan Trustee and of the Lien of this Indenture and shall no longer be deemed a Part hereunder, and (ii) such replacement Part shall become subject to the Lien of this Indenture and be deemed a Part of the Airframe or such Engine for all purposes to the same extent as the Parts originally incorporated or installed in or attached to the Airframe or such Engine. Upon request of Company from time to time, Loan Trustee shall execute and deliver to Company an appropriate instrument confirming the release of any such replaced Part from the Lien of this Indenture. (b) Pooling of Parts. Any Part removed from the Airframe or any Engine as provided in Section 7.04(a) may be subjected by Company or a Person permitted to be in possession of the Aircraft to a pooling arrangement entered into in the ordinary course of Company's or such Person's business; provided that the part replacing such removed Part shall be incorporated or installed in or attached to the Airframe or such Engine in accordance with Section 7.04(a) as promptly as practicable after the removal of such removed Part. In addition, any replacement Part when incorporated or installed in or attached to the Airframe or any Engine may be owned by any third party subject to such a pooling arrangement; provided that Company, at its expense, as promptly thereafter as practicable either (i) causes title to such replacement Part to vest in Company free and clear of all Liens (except Permitted Liens), or (ii) replaces such replacement Part by incorporating or installing in or attaching to the Airframe or such Engine a further replacement Part in the manner contemplated by Section 7.04(a). (c) Alterations, Modifications and Additions. Company will make (or cause to be made) such alterations and modifications in and additions to the Airframe and the Engines as are required from time to time to meet the applicable requirements of the FAA or any applicable government of any other jurisdiction in which the Aircraft is then registered; provided, however, that Company (or, if a Lease is then in effect, any Permitted Lessee) may, in good faith, contest the validity or application of any such requirement in any manner that does not involve any material risk of sale, loss or forfeiture of the Aircraft and does not materially adversely affect Loan Trustee's interest in the Aircraft. In addition, Company (or any Permitted Lessee), at its own expense, may from time to time add further parts or accessories and make or cause to be made such alterations and modifications in and additions to the Airframe or any Engine as Company (or any Permitted Lessee) deems desirable in the proper conduct of its business, including, without limitation, removal (without replacement) of Parts, provided that no such alteration, modification or addition shall materially diminish the value or utility of the Airframe or such Engine below its value or utility immediately prior to such alteration, modification or addition, assuming that the Airframe or such Engine was then in the condition required to be maintained by the terms of this Indenture, except that the value (but not the utility) of the Airframe or any Engine may be reduced by the value of any such Parts that are removed that Company deems obsolete or no longer suitable or appropriate for use on the Airframe or any Engine. All Parts incorporated or installed in or attached or added to the Airframe or any Engine as the result of such alteration, modification or addition shall, without further act, be subject to the Lien of this Indenture. Notwithstanding the foregoing, Company (or any Permitted Lessee) may, at any time, remove any Part from the Airframe or any Engine if such Part: (i) is in addition to, and not in replacement of or substitution for, any Part originally incorporated or installed in or attached to the Airframe or such Engine at the time of delivery thereof to Company or any Part in replacement of, or substitution for, any such Part, (ii) is not required to be incorporated or installed in or attached or added to the Airframe or such Engine pursuant to the first sentence of this Section 7.04(c) and (iii) can be removed from the Airframe or such Engine without materially diminishing the value or utility required to be maintained by the terms of this Indenture that the Airframe or such Engine would have had at such time had such removal not occurred. Upon the removal by Company (or any Permitted Lessee) of any Part as permitted by this Section 7.04(c), such removed Part shall, without further act, be free and clear of all rights and interests of Loan Trustee and the Lien of this Indenture and shall no longer be deemed a Part hereunder. Upon request of Company from time to time, Loan Trustee shall execute and deliver to Company an appropriate instrument confirming the release of any such removed Part from the Lien of this Indenture. (d) Substitution of Engines. Company shall have the right at its option at any time, on at least 30 days' prior written notice to Loan Trustee, to substitute a Replacement Engine for any Engine. In such event, and prior to the date of such substitution, Company shall replace such Engine by complying with the terms of Section 7.05(b) to the same extent as if an Event of Loss had occurred with respect to such Engine. Section 7.05 Loss, Destruction or Requisition. (a) Event of Loss with Respect to the Airframe. Upon the occurrence of an Event of Loss with respect to the Airframe or the Airframe and the Engines then installed thereon, Company shall as soon as practicable (and, in any event, within 30 days after an Event of Loss has occurred) notify Loan Trustee of such Event of Loss, and, within 90 days after such Event of Loss, Company shall give Loan Trustee written notice of its election to perform one of the following options (it being agreed that if Company has not given such notice of election within such 90-day period, Company shall be deemed to have elected to perform the option set forth in the following clause (ii)). Company may elect either to: (i) substitute, on or before the Loss Payment Date (as defined below), as replacement for the Airframe or Airframe and Engines with respect to which an Event of Loss has occurred, a Replacement Airframe (together with a number of Replacement Engines equal to the number of Engines, if any, with respect to which the Event of Loss occurred), such Replacement Airframe and Replacement Engines to be owned by Company free and clear of all Liens (other than Permitted Liens); provided that if Company has not performed such obligation on or prior to the Loss Payment Date, then Company shall on the Loss Payment Date prepay the Equipment Notes in full in accordance with Section 2.10; or (ii) redeem, on or before the Loss Payment Date, the Equipment Notes in full in accordance with Section 2.10. Company shall give Loan Trustee 20 days prior written notice if it elects to redeem the Equipment Notes on any day prior to the Loss Payment Date. The "Loss Payment Date" with respect to an Event of Loss means the Business Day next succeeding the 120th day following the date of occurrence of such Event of Loss. If Company elects to substitute a Replacement Airframe (or a Replacement Airframe and one or more Replacement Engines, as the case may be) Company shall, at its sole expense, not later than the Loss Payment Date, (A) cause an Indenture Supplement for such Replacement Airframe and Replacement Engines, if any, to be delivered to Loan Trustee for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of such other jurisdiction in which the Aircraft is then registered, (B) cause a financing statement or statements with respect to the Replacement Airframe and Replacement Engines, if any, or other requisite documents or instruments to be filed in such place or places as necessary in order to perfect Loan Trustee's interest therein in the United States, or in any other jurisdiction in which the Aircraft is then registered, (C) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel of Company) addressed to Loan Trustee to the effect that upon such replacement, such Replacement Airframe and Replacement Engines, if any, will be subject to the Lien of this Indenture and addressing the matters set forth in clauses (A) and (B), (D) furnish Loan Trustee with a certificate of an independent aircraft engineer or appraiser, certifying that the Replacement Airframe and Replacement Engines, if any, have a value and utility (without regard to hours or cycles) at least equal to the Airframe and Engines, if any, so replaced, assuming the Airframe and such Engines were in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss, (E) furnish Loan Trustee with evidence of compliance with the insurance provisions of Section 7.06 with respect to such Replacement Airframe and Replacement Engines, if any, and (F) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel of Company) to the effect that Loan Trustee will be entitled to the benefits of Section 1110 with respect to the Replacement Airframe, provided that (i) such opinion need not be delivered to the extent that the benefits of Section 1110 were not, by reason of a change in law or governmental or judicial interpretation thereof, available to Loan Trustee with respect to the Aircraft immediately prior to such substitution and (ii) such opinion may contain qualifications and assumptions of the tenor contained in the Section 1110 opinion of Company's special counsel delivered pursuant to Section 3.01 of the Participation Agreement on the Closing Date and such other qualifications and assumptions as are at the time customary in opinions rendered in comparable circumstances. In the case of each Replacement Airframe or Replacement Airframe and one or more Replacement Engines subjected to the Lien of this Indenture under this Section 7.05(a), promptly upon the recordation of the Indenture Supplement covering any such Replacement Airframe and Replacement Engines, if any, pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which such Replacement Airframe and Replacement Engines, if any, are registered), Company will cause to be delivered to Loan Trustee a favorable opinion of FAA counsel selected by Company if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Company, which counsel shall be reasonably satisfactory to Loan Trustee) addressed to Loan Trustee as to the due registration of such Replacement Aircraft and the due recordation of such Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Aircraft granted to Loan Trustee under this Indenture. For all purposes hereof, upon the attachment of the Lien of this Indenture thereto, the Replacement Aircraft and Replacement Engines, if any, shall become part of the Collateral, the Replacement Airframe shall be deemed an "Airframe" as defined herein, and each such Replacement Engine shall be deemed an "Engine" as defined herein. Upon compliance with clauses (A) through (F) of the third paragraph of this Section 7.05(a), Loan Trustee shall execute and deliver to Company an appropriate instrument releasing such replaced Airframe and Engines (if any) installed thereon at the time such Event of Loss occurred, all proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of such replaced Airframe and Engines (if any) and all rights relating to the foregoing, from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of the Airframe and Engines arising from the Event of Loss. If, after an Event of Loss, Company performs the option set forth in clause (ii) of the first paragraph of this Section 7.05(a), Loan Trustee shall execute and deliver to Company an appropriate instrument releasing the Aircraft, all proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of the Aircraft and all rights relating to the foregoing from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of the Aircraft arising from the Event of Loss. (b) Event of Loss with Respect to an Engine. Upon the occurrence of an Event of Loss with respect to an Engine under circumstances in which there has not occurred an Event of Loss with respect to the Airframe, Company shall give Loan Trustee prompt written notice thereof and shall, within 120 days after the occurrence of such Event of Loss, cause to be subjected to the Lien of this Indenture, as replacement for the Engine with respect to which such Event of Loss occurred, a Replacement Engine free and clear of all Liens (other than Permitted Liens). Prior to or at the time of any replacement under this Section 7.05(b), Company will (i) cause an Indenture Supplement covering such Replacement Engine to be delivered to Loan Trustee for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of any other jurisdiction in which the Aircraft is then registered, (ii) cause a financing statement or statements with respect to such Replacement Engine or other requisite documents or instruments to be filed in such place or places as necessary in order to perfect Loan Trustee's interest therein in the United States, or in such other jurisdiction in which the Engine is then registered, (iii) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel to Company) addressed to Loan Trustee to the effect that, upon such replacement, the Replacement Engine will be subject to the Lien of this Indenture, (iv) furnish Loan Trustee with a certificate of an aircraft engineer or appraiser (who may be an employee of Company) certifying that such Replacement Engine has a value and utility (without regard to hours or cycles) at least equal to the Engine so replaced assuming such Engine was in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss and (v) furnish Loan Trustee with evidence of compliance with the insurance provisions of Section 7.06 with respect to such Replacement Engine. In the case of each Replacement Engine subjected to the Lien of this Indenture under this Section 7.05(b), promptly upon the recordation of the Indenture Supplement covering such Replacement Engine pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which the Aircraft is registered), Company will cause to be delivered to Loan Trustee an opinion of FAA counsel selected by Company if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Company, which counsel shall be reasonably satisfactory to Loan Trustee) addressed to Loan Trustee as to the due recordation of such Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Engine granted to Loan Trustee under this Indenture. For all purposes hereof, upon the attachment of the Lien of this Indenture thereto, the Replacement Engine shall become part of the Collateral and shall be deemed an "Engine" as defined herein. Upon compliance with clauses (i) through (v) of the first sentence of this paragraph, Loan Trustee shall execute and deliver to Company an appropriate instrument releasing such replaced Engine, any proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of such replaced Engine and all rights relating to any of the foregoing from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of such Engine arising from the Event of Loss. (c) Application of Payments for Event of Loss from Requisition of Title or Use. Any payments other than insurance proceeds (the application of which is provided for in Section 7.06) received at any time by Company or by Loan Trustee from any government or other Person with respect to an Event of Loss to the Airframe or any Engine, will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Company pursuant to Section 7.05(a), such payments shall be paid over to, or retained by, Loan Trustee and upon completion of such replacement shall be paid over to, or retained by, Company; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced pursuant to Section 7.05(a), so much of such payments remaining after reimbursement of Loan Trustee for costs and expenses that shall not exceed the amounts required to be paid to Noteholders pursuant to Section 2.10 shall be applied in reduction of Company's obligation to pay such amounts, if not already paid by Company, or, if already paid by Company, shall be applied to reimburse Company for its payment of such amount and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Company; and (iii) if such payments are received with respect to an Engine with regard to which an Event of Loss has occurred, so much of such payments remaining after reimbursement of Loan Trustee for costs and expenses shall be paid over to, or retained by, Company; provided that Company has fully performed its obligations under Section 7.05(b) with respect to the Event of Loss for which such payments are made. (d) Requisition for Use by the Government of the Airframe and the Engines Installed Thereon. In the event of the requisition for use by any government (it being acknowledged that the use of the Airframe or any Engine pursuant to the CRAF Program does not constitute such a requisition) of the Airframe and the Engines or engines installed on the Airframe that does not constitute an Event of Loss, all of Company's rights and obligations under this Indenture with respect to the Airframe and such Engines shall continue to the same extent as if such requisition had not occurred; provided that, notwithstanding the foregoing, Company's obligations other than payment obligations shall only continue to the extent feasible. All payments received by Company or Loan Trustee from such government for such use of the Airframe and Engines or engines shall be paid over to, or retained by, Company. (e) Requisition for Use by the Government of an Engine not Installed on the Airframe. If any government requisitions the use, for a period in excess of sixty (60) days, of any Engine not then installed on the Airframe, Company will replace such Engine by complying with the terms of Section 7.05(b) to the same extent as if an Event of Loss had occurred with respect to such Engine. Upon such replacement, any payments received by Company or Loan Trustee from such government with respect to such requisition shall be paid over to, or retained by, Company. (f) Application of Payments During Existence of Event of Default. Any amount referred to in Section 7.05 that is payable to or retainable by Company shall not be paid to or retained by Company if at the time of such payment or retention an Event of Default or Payment Default has occurred and is continuing, but shall be held by or paid over to Loan Trustee as security for the obligations of Company under this Indenture. When any such Event of Default or Payment Default ceases, such amount shall be paid to Company. Section 7.06 Insurance. (a) Aircraft Liability Insurance. (i) Except as provided in clause (ii) of this subsection (a), and subject to the rights of Company to establish and maintain self-insurance in the manner and to the extent specified in Section 7.06(c), Company will carry, or cause to be carried, at no expense to Loan Trustee, aircraft liability insurance (including, but not limited to, bodily injury, personal injury and property damage liability, exclusive of manufacturer's product liability insurance) and contractual liability insurance with respect to the Aircraft (A) in amounts that are not less than the aircraft liability insurance applicable to similar aircraft and engines in Company's fleet on which Company carries insurance; provided that such liability insurance shall not be less than the amount certified in the insurance report delivered to Loan Trustee on the Closing Date, (B) of the type covering the same risks as from time to time applicable to aircraft operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as the Aircraft, and (C) that is maintained in effect with insurers of recognized responsibility. Any policies of insurance carried in accordance with this Section 7.06(a) and any policies taken out in substitution or replacement for any of such policies shall: (A) name Loan Trustee, Subordination Agent, each Pass Through Trustee, Policy Provider and Liquidity Provider as their Interests (as defined below in this Section 7.06) may appear, as additional insured (the "Additional Insureds"), (B) subject to the condition of clause (C) below, provide that, in respect of the interest of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Company and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by Company, (C) provide that, if such insurance is canceled for any reason whatever, or if any change is made in the policy that materially reduces the amount of insurance or the coverage certified in the insurance report delivered on the Closing Date to Loan Trustee, Policy Provider and Liquidity Provider, or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to any Additional Insured for 30 days (seven days, or such other period as is then generally available in the industry, in the case of any war risk or allied perils coverage) after receipt by such Additional Insured of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive any rights of (1) set-off, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent that Company has waived its rights by its agreements to indemnify the Additional Insureds pursuant to the Operative Documents, (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft and (G) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covering each insured. "Interests" as used in this Section 7.06(a) and in Section 7.06(b) with respect to any Person means the interests of such Person in the transactions contemplated by the Operative Documents. In the case of a lease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Company, or an insurance policy issued by such government, against any of the risks that Company is required to insure against hereunder shall be considered adequate insurance for purposes of this Section 7.06(a) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine, as the case may be, is on the ground and not being flown, Company may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Subsection 7.06(c), insurance otherwise conforming with the provisions of said clause (i) except that: (A) the amounts of coverage shall not be required to exceed the amounts of airline liability insurance from time to time applicable to airframes or engines owned or leased by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown and (B) the scope of the risks covered and the type of insurance shall be the same as from time to time are applicable to airframes or engines operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown. (b) Insurance Against Loss or Damage to Aircraft. (i) Except as provided in clause (ii) of this subsection (b), and subject to the rights of Company to establish and maintain self-insurance in the manner and to the extent specified in Section 7.06(c), Company shall maintain, or cause to be maintained, in effect with insurers of recognized responsibility, at no expense to Loan Trustee, all-risk aircraft hull insurance covering the Aircraft and all-risk coverage with respect to any Engines or Parts while removed from the Aircraft (including, without limitation, war risk insurance if and to the extent the same is maintained by Company (or, if a Lease is then in effect, by the Permitted Lessee) with respect to other similar aircraft operated by Company or such Permitted Lessee, as the case may be, on the same routes) that is of the type as from time to time applicable to the aircraft operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as the Aircraft; provided that (A) such insurance (including the permitted self-insurance) shall at all times while the Aircraft is subject to this Indenture be for an amount not less than 110% of the aggregate principal amount of the Equipment Notes outstanding from time to time, (B) such insurance need not cover an Engine while attached to an airframe not owned, leased or operated by Company, and (C) such insurance covering Engines and Parts removed from an Airframe or an airframe or (in the case of Parts) an Engine need be obtained only to the extent available at reasonable cost (as reasonably determined by Company). Any policies carried in accordance with this Section 7.06(b) and any policies taken out in substitution or replacement for any such policies shall: (A) provide that any insurance proceeds up to an amount equal to the outstanding principal amount of the Equipment Notes, together with accrued but unpaid interest thereon, plus an amount equal to the interest that would accrue on the outstanding principal amount of the Equipment Notes at the Debt Rate in effect on the date of payment of such insurance proceeds to Loan Trustee (as provided for in this sentence) during the period commencing on the day following the date of such payment to Loan Trustee and ending on the Loss Payment Date (the sum of such three amounts being the "Loan Amount"), payable for any loss or damage constituting an Event of Loss with respect to the Aircraft and any insurance proceeds in excess of the amount set forth on Exhibit C up to the amount of the Loan Amount for any loss or damage to the Aircraft (or Engines) not constituting an Event of Loss with respect to the Aircraft (or Engines), shall be paid to Loan Trustee as long as the Indenture has not been discharged, and that all other amounts shall be payable to Company, unless the insurer has received notice that an Event of Default exists, in which case all insurance proceeds for any loss or damage to the Aircraft (or Engines) up to the Loan Amount shall be payable to Loan Trustee, (B) subject to the conditions of clause (C) below, provide that, in respect of the interests of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Company and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation by Company of any warranty, declaration or condition contained in such policies, (C) provide that if such insurance is canceled for any reason, or if any change is made in the insurance that materially reduces the coverage (not including the amount) certified in the insurance report delivered on the Closing Date to Loan Trustee and Liquidity Provider or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to the Additional Insureds for 30 days (seven days, or such other period as is customarily available in the industry, in the case of war risk or allied perils coverage) after receipt by the Additional Insureds of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive rights of (1) setoff, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent Company has waived its rights by its agreement to indemnify the Additional Insureds pursuant to the Operative Documents and (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft. In the case of a lease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Company, or an insurance policy issued by such government, against any risks which Company is required hereunder to insure against shall be considered adequate insurance for purposes of this Section 7.06(b) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine is on the ground and not being flown, Company may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Subsection 7.06(c), insurance otherwise conforming with the provisions of said clause (i) except that the scope of the risks covered and the type of insurance shall be the same as from time to time applicable to airframes and engines operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown; provided that, subject to self-insurance to the extent permitted by Subsection 7.06(c), Company shall maintain or cause to be maintained insurance against risk of loss or damage to such non-flown Airframe or Engine in an amount at least equal to 110% of the aggregate outstanding principal amount of the Equipment Notes during such period that such Airframe or Engine is on the ground and not being flown. (c) Self-Insurance. Company may from time-to-time self-insure, by way of deductible, self-insured retention, premium adjustment or franchise or otherwise (including, with respect to insurance maintained pursuant to Subsections 7.06(a) or 7.06(b), insuring for a maximum amount that is less than the amounts set forth in Sections 7.06(a) and 7.06(b)), the risks required to be insured against pursuant to Sections 7.06(a) and 7.06(b), but in no case shall the self-insurance with respect to all of the aircraft and engines in Company's fleet (including, without limitation, the Aircraft) exceed for any 12-month policy year 1% of the average aggregate insurable value (for the preceding policy year) of all aircraft (including, without limitation, the Aircraft) on which Company carries insurance, unless an insurance broker of national standing certifies that the standard among other major United States airlines is a higher level of self-insurance, in which case Company may self-insure the Aircraft to such higher level. In addition to the foregoing right to self-insure, Company may self-insure to the extent of (1) any deductible per occurrence that, in the case of the Aircraft, is not in excess of the amount customarily allowed as a deductible in the industry or is required to facilitate claims handling or (2) any applicable mandatory minimum per aircraft (or if applicable per annum or other period) hull or liability insurance deductibles imposed by the aircraft hull or liability insurers. (d) Application of Insurance Payments. All losses will be adjusted by Company with the insurers. As between Loan Trustee and Company it is agreed that all insurance payments received under policies required to be maintained by Company hereunder, exclusive of any payments received in excess of the Loan Amount for the Aircraft from such policies, as the result of the occurrence of an Event of Loss with respect to the Airframe or an Engine will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Company pursuant to Section 7.05(a), such payments shall be paid over to, or retained by, Loan Trustee and upon completion of such replacement shall be paid over to, or retained by, Company; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced as contemplated by Section 7.05(a), so much of such payments remaining after reimbursement of Loan Trustee for its costs and expenses as do not exceed the amounts required to be paid by Company pursuant to Section 2.10 shall be applied in reduction of Company's obligation to pay such amounts, if not already paid by Company, or, if already paid by Company, shall be applied to reimburse Company for its payment of such amounts and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Company; and (iii) if such payments are received with respect to an Engine, so much of such payments remaining after reimbursement of Loan Trustee for its costs and expenses shall be paid over to, or retained by, Company; provided that Company has fully performed its obligations under Section 7.05(b) with respect to the Event of Loss for which such payments are made. In all events, the insurance payment of any property damage loss received under policies maintained by Company in excess of the Loan Amount for the Aircraft shall be paid to Company. The insurance payments for any loss or damage to the Airframe or an Engine not constituting an Event of Loss with respect to the Airframe or such Engine will be applied in payment (or to reimburse Company) for repairs or for replacement property in accordance with the terms of Sections 7.02 and 7.04, and any balance remaining after compliance with such Sections with respect to such loss or damage shall be paid to Company. Any amount referred to in the preceding sentence or in clause (i), (ii) or (iii) of the first paragraph of this Section 7.06(d) that is payable to Company shall not be paid to Company (or, if it has been previously paid directly to Company, shall not be retained by Company) if at the time of such payment an Event of Default or Payment Default has occurred and is continuing, but shall be paid to and held by Loan Trustee as security for the obligations of Company under this Indenture, and when any such Event of Default or Payment Default ceases, such amount shall, to the extent not theretofore applied as provided herein, be paid to Company. (e) Reports, Etc. On or before the Closing Date and annually following renewal of Company's insurance coverage, Company will furnish to Loan Trustee, Policy Provider and Liquidity Provider a report signed by a firm of independent aircraft insurance brokers appointed by Company (which brokers may be in the regular employ of Company), stating the opinion of such firm that the insurance then carried and maintained on the Aircraft complies with the terms hereof. All information contained in such report shall be Confidential Information and shall be treated by Loan Trustee, Policy Provider and Liquidity Provider and each of their affiliates and officers, directors, agents and employees in accordance with the provisions of Section 10.16. Company will cause such firm to notify Loan Trustee, Policy Provider and Liquidity Provider of any act or omission on the part of Company of which such firm has knowledge that might invalidate or render unenforceable, in whole or in part, any insurance on the Aircraft. Company will also cause such firm to notify Loan Trustee, Policy Provider and Liquidity Provider as promptly as practicable after such firm acquires knowledge that an interruption of any insurance carried and maintained on the Aircraft pursuant to this Section 7.06 will occur. Such information may only be provided to other Persons in accordance with Section 10.16. (f) Salvage Rights; Other. All salvage rights to the Airframe and each Engine shall remain with Company's insurers at all times, and any insurance policies of Loan Trustee insuring the Airframe or any Engine shall provide for a release to Company of any and all salvage rights in and to the Airframe or any Engine. Neither Loan Trustee nor any Noteholder may, directly or indirectly, obtain insurance for its own account with respect to the Airframe or any Engine if such insurance would limit or otherwise adversely affect the coverage or amounts payable under, or increase the premiums for, any insurance required to be maintained pursuant to this Section 7.06 or any other insurance maintained with respect to the Aircraft or any other aircraft in Company's fleet. ARTICLE VIII SUCCESSOR AND ADDITIONAL TRUSTEES Section 8.01 Resignation or Removal; Appointment of Successor. (a) The resignation or removal of Loan Trustee and the appointment of a successor Loan Trustee shall become effective only upon the successor Loan Trustee's acceptance of appointment as provided in this Section 8.01. Loan Trustee or any successor thereto must resign if at any time it ceases to be eligible in accordance with the provisions of Section 8.01(c) and may resign at any time without cause by giving at least 60 days' prior written notice to Company and each Noteholder. In addition, either Company (so long as no Event of Default or Payment Default shall have occurred and be continuing) or a Majority in Interest of Noteholders (but only with the consent of Company so long as no Event of Default or Payment Default shall have occurred and be continuing), may at any time remove Loan Trustee without cause by an instrument in writing delivered to Loan Trustee and each Noteholder, and, in case of a removal by a Majority in Interest of Noteholders, to Company. In the case of the resignation or removal of Loan Trustee, Company shall promptly appoint a successor Loan Trustee. If a successor Loan Trustee has not been appointed within 60 days after such notice of resignation or removal, Loan Trustee, Company or any Noteholder may apply to any court of competent jurisdiction to appoint a successor Loan Trustee to act until such time, if any, as a successor is appointed as above provided. The successor Loan Trustee so appointed by such court shall immediately and without further act be superseded by any successor Loan Trustee appointed as above provided. (b) Any successor Loan Trustee, however appointed, shall execute and deliver to the predecessor Loan Trustee and Company an instrument accepting such appointment and assuming the obligations of Loan Trustee arising from and after the time of such appointment, and thereupon such successor Loan Trustee, without further act, shall become vested with all the estates, properties, rights, powers and duties of the predecessor Loan Trustee in the trust hereunder applicable to it with like effect as if originally named Loan Trustee herein; but nevertheless upon the written request of such successor Loan Trustee, such predecessor Loan Trustee shall execute and deliver an instrument transferring to such successor Loan Trustee all the estates, properties, rights and powers of such predecessor Loan Trustee, and such predecessor Loan Trustee shall duly assign, transfer, deliver and pay over to such successor Loan Trustee all monies or other property and all other books and records, or true, correct and complete copies thereof, then held by such predecessor Loan Trustee. (c) This Indenture shall at all times have a Loan Trustee, however appointed, that is a Citizen of the United States (without the use of a voting trust) and a bank or trust company having a combined capital and surplus of at least $100,000,000 (or a combined capital and surplus in excess of $5,000,000 and the obligations of which, whether now in existence or hereafter incurred, are fully and unconditionally guaranteed by a corporation organized and doing business under the laws of the United States or any state or territory thereof or the District of Columbia and having a combined capital and surplus of at least $100,000,000) or a corporation with a net worth of at least $100,000,000, if there be such an institution willing, able and legally qualified to perform the duties of Loan Trustee upon reasonable or customary terms. If such bank, trust company or corporation publishes reports of conditions at least annually, pursuant to law or to the requirements of federal, state, territorial or District of Columbia supervising or examining authority, then for the purposes of this Section 8.01(c) the combined capital and surplus of such bank, trust company or corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of conditions so published. In case at any time Loan Trustee ceases to be eligible in accordance with the provisions of this Section 8.01(c), Loan Trustee shall resign immediately in the manner and with the effect specified in Section 8.01(a). (d) Any corporation into which Loan Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which Loan Trustee is a party, or any corporation to which substantially all the corporate trust business of Loan Trustee may be transferred, shall, subject to the terms of Section 8.01(c), be a successor Loan Trustee under this Indenture without further act. Section 8.02 Appointment of Additional and Separate Trustees. (a) Whenever (i) Loan Trustee deems it necessary or desirable in order to conform to any law of any jurisdiction in which all or any part of the Collateral is situated or to make any claim or bring any suit with respect to or in connection with the Collateral, any Operative Document or any of the transactions contemplated by the Operative Documents, (ii) Loan Trustee shall be advised by counsel satisfactory to it that it is necessary or prudent in the interests of Noteholders (and Loan Trustee shall so advise Company) or (iii) Loan Trustee has been requested to do so by a Majority in Interest of Noteholders, then in any such case, Loan Trustee and, upon the written request of Loan Trustee, Company, shall execute and deliver an indenture supplemental hereto and such other instruments as from time to time are necessary or advisable either (1) to constitute one or more banks or trust companies or corporations meeting the requirements of Section 8.01(c) and approved by Loan Trustee, either to act jointly with Loan Trustee as additional trustee or trustees of all or any part of the Collateral or to act as separate trustee or trustees of all or any part of the Collateral, in each case with such rights, powers, duties and obligations consistent with this Indenture as is provided in such supplemental indenture or other instruments as Loan Trustee or a Majority in Interest of Noteholders deems necessary or advisable, or (2) to clarify, add to or subtract from the rights, powers, duties and obligations theretofore granted any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.02. If no Event of Default has occurred and is continuing, no additional or supplemental trustee shall be appointed without Company's consent. If an Event of Default shall have occurred and be continuing, Loan Trustee may act under the foregoing provisions of this Section 8.02(a) without the concurrence of Company, and Company hereby irrevocably appoints (which appointment is coupled with an interest) Loan Trustee as its agent and attorney-in-fact to act for it under the foregoing provisions of this Section 8.02(a). Loan Trustee may, in such capacity, execute, deliver and perform any such supplemental indenture, or any such instrument, as may be required for the appointment of any such additional or separate trustee or for the clarification of, addition to or subtraction from the rights, powers, duties or obligations theretofore granted to any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.02. In case any additional or separate trustee appointed under this Section 8.02(a) becomes incapable of acting, resigns or is removed, all the assets, property, rights, powers, trusts, duties and obligations of such additional or separate trustee shall revert to Loan Trustee until a successor additional or separate trustee is appointed as provided in this Section 8.02(a). (b) No additional or separate trustee shall be entitled to exercise any of the rights, powers, duties and obligations conferred upon Loan Trustee in respect of the custody, investment and payment of monies and all monies received by any such additional or separate trustee from or constituting part of the Collateral or otherwise payable under any Operative Documents to Loan Trustee shall be promptly paid over by it to Loan Trustee. All other rights, powers, duties and obligations conferred or imposed upon any additional or separate trustee shall be exercised or performed by Loan Trustee and such additional or separate trustee jointly except to the extent that applicable law of any jurisdiction in which any particular act is to be performed renders Loan Trustee incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations (including the holding of title to all or part of the Collateral in any such jurisdiction) shall be exercised and performed by such additional or separate trustee. No additional or separate trustee shall take any discretionary action except on the instructions of Loan Trustee or a Majority in Interest of Noteholders. No trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder, except that Loan Trustee shall be liable for the consequences of its lack of reasonable care in selecting, and Loan Trustee's own actions in acting with, any additional or separate trustee. Each additional or separate trustee appointed pursuant to this Section 8.02 shall be subject to, and shall have the benefit of Articles IV, V, VI, VIII, IX and X hereof insofar as they apply to Loan Trustee. The powers of any additional or separate trustee appointed pursuant to this Section 8.02 shall not in any case exceed those of Loan Trustee. (c) If at any time Loan Trustee deems it no longer necessary or desirable or in the event that Loan Trustee has been requested to do so in writing by a Majority in Interest of Noteholders, Loan Trustee and, upon the written request of Loan Trustee, Company, shall execute and deliver an indenture supplemental hereto and all other instruments and agreements necessary or proper to remove any additional or separate trustee. Loan Trustee may act on behalf of Company under this Section 8.02(c) when and to the extent it could so act under Section 8.02(a) hereof. In any case, Company may remove an additional or separate trustee in the manner set forth in Section 8.01. ARTICLE IX AMENDMENTS AND WAIVERS Section 9.01 Amendments to this Indenture without Consent of Holders. At any time after the date hereof, Company and Loan Trustee may enter into one or more agreements supplemental hereto without notice to or consent of any Noteholder for any of the following purposes: (i) to evidence the succession of another Person to Company and the assumption by any such successor of the covenants of Company contained in any Operative Documents pursuant to Section 6.02(e) of the Participation Agreement; (ii) to cure any defect or inconsistency herein or in the Equipment Notes; (iii) to cure any ambiguity or correct any mistake; (iv) to evidence the succession of a new trustee hereunder pursuant hereto or the removal of the trustee hereunder or to provide for or facilitate the appointment of an additional or separate trustee pursuant to Section 8.02 hereof; (v) to convey, transfer, assign, mortgage or pledge any property to or with Loan Trustee; (vi) to make any other provisions or amendments with respect to matters or questions arising hereunder or under the Equipment Notes, or to amend, modify or supplement any provision hereof or thereof, so long as such action shall not adversely affect the interests of Noteholders or Liquidity Provider; (vii) to correct or amplify the description of any property at any time subject to the Lien of this Indenture, or better to assure, convey and confirm unto Loan Trustee any property subject or required to be subject to the Lien of this Indenture or to subject to the Lien of this Indenture the Airframe or Engines or any Replacement Airframe or Replacement Engine; (viii) to add to the covenants of Company for the benefit of Noteholders, or to surrender any rights or power herein conferred upon Company; (ix) to add to the rights of Noteholders; (x) to include on the Equipment Notes any legend required by law or as otherwise necessary or advisable and (xi) to comply with any applicable requirements of the Trust Indenture Act of 1939, as amended, or any other requirements of applicable law or of any regulatory body. Section 9.02 Amendments to this Indenture with Consent of Holders. (a) With the written consent of a Majority in Interest of Noteholders, Company may, and Loan Trustee shall, subject to Section 9.06, at any time and from time to time, enter into such supplemental agreements to add any provisions to or to change or eliminate any provisions of this Indenture or of any such supplemental agreements or to modify in any manner the rights and obligations of Company, Loan Trustee and of Noteholders under this Indenture; provided, however, that without the consent of each Noteholder affected thereby, an amendment under this Section 9.02 may not: (1) reduce the principal amount of, Make-Whole Amount, if any, or interest on, any Equipment Note; (2) change the date on which any principal amount of, Make-Whole Amount, if any, or interest on any Equipment Note, is due or payable; (3) create any Lien with respect to the Collateral prior to or pari passu with the Lien thereon under this Indenture except such as are permitted by this Indenture, or deprive any Noteholder of the benefit of the Lien on the Collateral created by this Indenture; (4) reduce the percentage of the outstanding principal amount of the Equipment Notes the consent of whose holders is required for any such supplemental agreement, or the consent of whose holders is required for any waiver of compliance with certain provisions of this Indenture or of certain defaults hereunder or their consequences provided for in this Indenture; or (5) make any change in Section 4.05 or this Section 9.02, except to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of each Noteholder affected thereby. (b) It is not necessary under this Section 9.02 for Noteholders to consent to the particular form of any proposed supplemental agreement, but it is sufficient if they consent to the substance thereof. (c) Promptly after the execution by Company and Loan Trustee of any supplemental agreement pursuant to the provisions of this Section 9.02, Loan Trustee shall transmit by first-class mail a notice, setting forth in general terms the substance of such supplemental agreement, to all Noteholders, as the names and addresses of such Noteholders appear on the Equipment Note Register. Any failure of Loan Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental agreement. Section 9.03 Amendments, Waivers, Etc. of the Participation Agreement. Without the consent of a Majority in Interest of Noteholders, the respective parties to the Participation Agreement may not modify, amend or supplement such agreement, or give any consent, waiver, authorization or approval thereunder, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions thereof or of modifying in any manner the rights of the respective parties thereunder; provided, however, that, without the consent of Loan Trustee or any Noteholder, the Participation Agreement may be modified, amended or supplemented in order (i) to cure any defect or inconsistency therein or to cure any ambiguity or correct any mistake, (ii) to amend, modify or supplement any provision thereof or make any other provision with respect to matters or questions arising thereunder or under this Indenture, provided that the making of any such other provision shall not materially adversely affect the interests of Noteholders or (iii) to make any other change, or reflect any other matter, of the kind referred to in clauses (i) through (xi) of Section 9.01. Notwithstanding the foregoing, without the consent of Liquidity Provider, Company shall not enter into any amendment, waiver or modification of or supplement or consent to the Participation Agreement which shall reduce, modify or amend any indemnities in favor of Liquidity Provider contained therein. Section 9.04 Revocation and Effect of Consents. Until an amendment or waiver becomes effective, a consent to it by a Noteholder is a continuing consent by Noteholder and every subsequent Noteholder, even if notation of the consent is not made on any Equipment Note. Section 9.05 Notation on or Exchange of Equipment Notes. Loan Trustee may place an appropriate notation about an amendment or waiver on any Equipment Note thereafter executed. Loan Trustee in exchange for such Equipment Notes may execute new Equipment Notes that reflect the amendment or waiver. Section 9.06 Trustee Protected. If, in the reasonable opinion of the institution acting as Loan Trustee, any document required to be executed by it pursuant to the terms of Section 9.01 or 9.02 adversely affects any right, duty, immunity or indemnity with respect to such institution under this Indenture, such institution may in its discretion decline to execute such document. ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture. (a) Upon (or at any time after): (i) payment in full of the principal amount, Make-Whole Amount, if any, and interest on and all other amounts due under all Equipment Notes and provided that there shall then be no other Secured Obligations due to Noteholders, Indenture Indemnitees and Loan Trustee hereunder or under the Participation Agreement; or (ii) the 91st day after there has been irrevocably deposited (except as provided in Section 2.15 or 10.01(d)) with Loan Trustee as funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of Noteholders: (A) money in an amount, (B) U.S. Government Obligations that, through the payment of interest and principal in respect thereof in accordance with their terms, will provide (not later than one Business Day before the due date of any payment referred to below in this paragraph) money in an amount, or (C) a combination of money and U.S. Government Obligations referred to in the foregoing clause (B), sufficient, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to Loan Trustee, to pay in full the outstanding principal amount of and interest on all the Equipment Notes then outstanding on the dates such amounts are due; provided, however, that (1) Company has delivered to Loan Trustee an officer's certificate and an opinion of counsel to the effect that there has been a change in tax law since April 23, 2002 or has been published by the Internal Revenue Service a ruling to the effect that Noteholders and the holders of the Pass Through Certificates will not recognize income, gain or loss for United States Federal income tax purposes as a result of the exercise by Company of its option under this subsection (ii) and will be subject to United States Federal income tax on the same amounts and in the same manner and at the same times, as would have been the case if such option had not been exercised; (2) all other amounts then due and payable hereunder have been paid; (3) Company has delivered to Loan Trustee an officer's certificate and an opinion of counsel (which may be internal counsel to Company), each stating that all conditions precedent to the satisfaction and discharge of this Indenture set forth in this Section 10.01 have been complied with; (4) such deposit will not result in a breach or violation of, or constitute an Event of Default under, this Indenture; (5) no Event of Default set forth in Sections 4.01(f), (g), (h) or (i) shall have occurred and be continuing on the date of such deposit or at any time during the period beginning on such date and ending on the 91st day after the date of such deposit; and (6) Company has delivered to Loan Trustee written confirmation from each of the Rating Agencies that such deposit, the resulting release and discharge of Company from its obligations under this Indenture and under the Equipment Notes and the release of the Aircraft and the balance of the Collateral from the Lien of this Indenture will not result in a reduction in the rating for any class of Pass Through Certificates below the then current rating for such class of Pass Through Certificates or a withdrawal or suspension of the rating of any class of Pass Through Certificates, without regard to the Policy (as defined in the Policy Provider Agreement); Company and Loan Trustee shall be deemed to have been released and discharged from their respective obligations hereunder and under the Equipment Notes and the security interest, mortgage lien and all other estate, right, title and interest granted by this Indenture shall cease and become null and void and all of the property, rights, interests and privileges granted as security for the Equipment Notes shall revert to and revest in Company without any other act or formality whatsoever, and Loan Trustee shall, upon the written request of Company, execute and deliver to, or as directed in writing by, Company an appropriate instrument (in due form for recording) releasing the Aircraft and the balance of the Collateral from the Lien of this Indenture together with such other instruments and documents as Company reasonably requests to give effect to the release and termination, and, in such event, this Indenture and the trusts created hereby shall terminate and this Indenture shall be of no further force or effect; provided, however, that this Indenture and the trusts created hereby shall earlier terminate and this Indenture shall be of no further force or effect upon any sale or other final disposition by Loan Trustee of all property constituting part of the Collateral and the final distribution by Loan Trustee of all monies or other property or proceeds constituting part of the Collateral in accordance with the terms hereof. Except as otherwise provided above, this Indenture and the trusts created hereby shall continue in full force and effect in accordance with the terms hereof. Upon the deposit of the defeasance funds as described above, the right of Company to cause redemption of the Equipment Notes shall cease. (b) Notwithstanding the provisions of Section 10.01(a)(ii), the obligations of Loan Trustee contained in Sections 2.01, 2.02, 2.03, 2.04, 2.05, 2.07, 2.08, 2.09, 2.13, 2.15, 2.16, 3.01, 10.01(c) and 10.01(d) of this Section 10.01, and the other rights, duties, immunities and privileges hereunder of Loan Trustee, shall survive. (c) All monies and U.S. Government Obligations deposited with Loan Trustee pursuant to Section 10.01(a)(ii) shall be held in trust and applied by it, in accordance with the provisions of the Equipment Notes and this Indenture, to the payment to Noteholders of all sums due and to become due thereon for principal and interest, but such money need not be segregated from other funds received pursuant hereto except to the extent required by law. (d) Loan Trustee shall promptly pay or return to Company upon request of Company any money or U.S. Government Obligations held by it at any time that are not required for the payment of the amounts described above in Section 10.01(c) on the Equipment Notes for which money or U.S. Government Obligations have been deposited pursuant to Section 10.01(a)(ii). Section 10.02 No Legal Title to Collateral in Noteholders. No Noteholder shall have legal title to any part of the Collateral. No transfer, by operation of law or otherwise, of any Equipment Note or other right, title and interest of any Noteholder in and to the Collateral or hereunder shall operate to terminate this Indenture or entitle such Noteholder or any successor or transferee of such holder to an accounting or to the transfer to it of any legal title to any part of the Collateral. Section 10.03 Sale of Aircraft by Loan Trustee is Binding. Any sale or other conveyance of the Aircraft, the Airframe, any Engine or any interest therein by Loan Trustee made pursuant to the terms of this Indenture shall bind Noteholders and Company and shall be effective to transfer or convey all right, title and interest of Loan Trustee, Company and such Noteholders in and to such Aircraft, Airframe, Engine or interest therein. No purchaser or other grantee shall be required to inquire as to the authorization, necessity, expediency or regularity of such sale or conveyance or as to the application of any sale or other proceeds with respect thereto by Noteholders. Section 10.04 Indenture for Benefit of Company, Loan Trustee and Noteholders. Nothing in this Indenture, whether express or implied, shall be construed to give any Person other than Company, Loan Trustee, Noteholders or the other Indenture Indemnitees any legal or equitable right, remedy or claim under or in respect of this Indenture. Section 10.05 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Indenture shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: (i) if to Company, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 715-1657 (ii) if to Loan Trustee, addressed to: State Street Bank And Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Facsimile: (860) 244-1881 or if to any Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 hereof. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 10.05. Section 10.06 Severability. Any provision of this Indenture that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 10.07 No Oral Modification or Continuing Waivers. No terms or provisions of this Indenture or of the Equipment Notes may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by Company and Loan Trustee, in compliance with Article IX. Any waiver of the terms hereof or of any Equipment Note shall be effective only in the specific instance and for the specific purpose given. Section 10.08 Successors and Assigns. All covenants and agreements contained herein shall bind and inure to the benefit of, and be enforceable by, each of the parties hereto and the successors and permitted assigns of each, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by any Noteholder shall bind the successors and permitted assigns of such Noteholder. Each Noteholder by its acceptance of an Equipment Note agrees to be bound by this Indenture and all provisions of the Participation Agreement applicable to a Noteholder. Section 10.09 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 10.10 Normal Commercial Relations. Anything contained in this Indenture to the contrary notwithstanding, Loan Trustee, any Noteholder or any other party to any of the Operative Documents or the Pass Through Documents or any of their affiliates may conduct any banking or other financial transactions, and have banking or other commercial relationships, with Company, fully to the same extent as if this Indenture were not in effect, including without limitation the making of loans or other extensions of credit to Company for any purpose whatsoever, whether related to any of the transactions contemplated hereby or otherwise. Section 10.11 Voting by Noteholders. All votes of Noteholders shall be governed by a vote of a Majority in Interest of Noteholders, except as otherwise provided herein. Section 10.12 Section 1110. It is the intention of the parties hereto that the security interest created hereby, to the fullest extent available under applicable law, entitles Loan Trustee, on behalf of Noteholders, to all of the benefits of Section 1110 with respect to the Aircraft. Section 10.13 Company's Performance and Rights. Any obligation imposed on Company herein shall require only that Company perform or cause to be performed such obligation, even if stated as a direct obligation, and the performance of any such obligation by any permitted assignee, lessee or transferee under an assignment, lease or transfer agreement then in effect and in accordance with the provisions of the Operative Documents shall constitute performance by Company and, to the extent of such performance, discharge such obligation by Company. Except as otherwise expressly provided herein, any right granted to Company in this Indenture shall grant Company the right to permit such right to be exercised by any such assignee, lessee or transferee. The inclusion of specific references to obligations or rights of any such assignee, lessee or transferee in certain provisions of this Indenture shall not in any way prevent or diminish the application of the provisions of the two sentences immediately preceding with respect to obligations or rights in respect of which specific reference to any such assignee, lessee or transferee has not been made in this Indenture. Section 10.14 Counterparts. This Indenture may be executed in any number of counterparts (and each of the parties hereto shall not be required to execute the same counterpart). Each counterpart of this Indenture including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Indenture, but all of such counterparts together shall constitute one instrument. Section 10.15 Governing Law. THIS INDENTURE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS INDENTURE, ANY INDENTURE SUPPLEMENT AND THE EQUIPMENT NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 10.16 Confidential Information. The term "Confidential Information" means: (a) the existence and terms of any lease of the Airframe or Engines pursuant to Section 7.02(a) and the identity of the Permitted Lessee thereunder; (b) all information obtained in connection with any inspection conducted by Loan Trustee or its representative pursuant to Section 7.03(a); (c) each certification furnished to Loan Trustee pursuant to Sections 7.06(a) and 7.06(b); (d) all information contained in each report furnished to Loan Trustee pursuant to Section 7.06(e); and (e) all information regarding the Warranty Rights. All Confidential Information shall be held confidential by Loan Trustee and each Noteholder and each affiliate, agent, officer, director, or employee of any thereof and shall not be furnished or disclosed by any of them to anyone other than (i) Loan Trustee or any Noteholder and (ii) their respective bank examiners, auditors, accountants, agents and legal counsel, and except as may be required by an order of any court or administrative agency or by any statute, rule, regulation or order of any governmental authority. Section 10.17 Submission to Jurisdiction. Each of the parties hereto, and by acceptance of Equipment Notes, each Noteholder, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Agreements hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Indenture, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Indenture or the Equipment Notes or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed by their respective officers thereof duly authorized, as of the date first above written. DELTA AIR LINES, INC. By: ------------------------------------ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Loan Trustee By: ------------------------------------ Name: Title: EXHIBIT A to INDENTURE AND SECURITY AGREEMENT INDENTURE SUPPLEMENT NO. ___ INDENTURE SUPPLEMENT NO. __ , dated _____________, ____ ("Indenture Supplement"), between DELTA AIR LINES, INC. ("Company") and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee under the Indenture (each as hereinafter defined). W I T N E S S E T H: WHEREAS, the Indenture and Security Agreement (N372DA), dated as of April 30, 2002 (the "Indenture"; capitalized terms used herein without definition shall have the meanings specified therefor in Annex A to the Indenture), between Company and State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity, except as expressly provided therein, but solely as Loan Trustee ("Loan Trustee"), provides for the execution and delivery of supplements thereto substantially in the form hereof which shall particularly describe the Aircraft, and shall specifically grant a security interest in the Aircraft to Loan Trustee; and [WHEREAS, the Indenture relates to the Airframe and Engines described in Annex A attached hereto and made a part hereof, and a counterpart of the Indenture is attached to and made a part of this Indenture Supplement;]* - ----------------- * Use for Indenture Supplement No. 1 only. [WHEREAS, Company has, as provided in the Indenture, heretofore executed and delivered to Loan Trustee Indenture Supplement(s) for the purpose of specifically subjecting to the Lien of the Indenture certain airframes and/or engines therein described, which Indenture Supplement(s) is/are dated and has/have been duly recorded with the FAA as set forth below, to wit: Date Recordation Date FAA Document Number]** - ---- ---------------- -------------------- - ---------------- ** Use for all Indenture Supplements other than Indenture Supplement No. 1. NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and all other amounts payable by Company under the Operative Documents and the performance and observance by Company of all the agreements and covenants to be performed or observed by Company for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Company at or before the Closing Date, the receipt of which is hereby acknowledged, Company does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Company in, to and under the Aircraft, including the Airframe and Engines described in Annex A attached hereto, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided in the Indenture, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto; To have and to hold all and singular the aforesaid property unto Loan Trustee, and its successors and assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in the Indenture, including Section 2.13 and Article III of the Indenture, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and subject to the terms and provisions set forth in the Indenture. This Indenture Supplement shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and is hereby ratified, approved and confirmed. THIS INDENTURE SUPPLEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement No. __ to be duly executed by their respective duly authorized officers, on the date first above written. DELTA AIR LINES, INC. By: ------------------------------------ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By: ------------------------------------ Name: Title: Annex A to Indenture Supplement No. __ DESCRIPTION OF AIRFRAME AND ENGINES AIRFRAME Manufacturer Model FAA Registration No. Manufacturer's Serial No. - ------------ ----- -------------------- ------------------------- ENGINES Manufacturer Model Manufacturer's Serial No. - ------------ ----- ------------------------- Each Engine is of 750 or more "rated take-off horsepower" or the equivalent of such horsepower. EXHIBIT B to INDENTURE AND SECURITY AGREEMENT LIST OF PERMITTED COUNTRIES Argentina Australia Austria Bahamas Barbados Belgium Bermuda Islands Brazil British Virgin Islands Canada Cayman Islands Chile Czech Republic Denmark Ecuador Egypt Finland France Germany Greece Grenada Guatemala Hungary Iceland India Indonesia Ireland Italy Jamaica Japan Kuwait Liechtenstein Luxembourg Malta Mexico Monaco Morocco Netherlands Antilles Netherlands, the New Zealand Norway Paraguay Peoples' Republic of China Philippines Poland Portugal Republic of China (Taiwan) Singapore South Africa South Korea Spain Sweden Switzerland Thailand Trinidad and Tobago United Kingdom Uruguay Venezuela EXHIBIT C to INDENTURE AND SECURITY AGREEMENT AIRCRAFT TYPE VALUE FOR SECTION 7.06(b) Boeing 737-832 - $8,000,000 SCHEDULE I to INDENTURE AND SECURITY AGREEMENT DESCRIPTION OF EQUIPMENT NOTES Original Principal Interest Rate Maturity Date Amount ------------- ------------- ------ Series G-1 Equipment Notes: $19,985,061.21 6.718% January 2, 2022 Series G-2 Equipment Notes: $1,073,800.00 6.417% July 2, 2012 Series C Equipment Notes: $4,602,000.00 7.779% January 2, 2011 EQUIPMENT NOTES AMORTIZATION SERIES G-1 EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid ------------ ---------- The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. [Intentionally Omitted] EQUIPMENT NOTES AMORTIZATION SERIES C EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid ------------ ---------- The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. [Intentionally Omitted] SCHEDULE II to INDENTURE AND SECURITY AGREEMENT PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST SUPPLEMENTS Pass Through Trust Agreement, dated as of November 16, 2000, between Delta Air Lines, Inc. and State Street Bank and Trust Company of Connecticut, National Association, as trustee, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, and Trust Supplement No. 2002-1C, dated as of April 30, 2002. Annex A to Participation Agreement and Indenture and Security Agreement (N372DA) DEFINITIONS (N372DA) "Additional Insureds" has the meaning specified in Section 7.06(a) of the Indenture. "After-Tax Basis" means that indemnity and compensation payments required to be made on such basis will be supplemented by the Person paying the base amount by that amount which, when added to such base amount, and after deduction of all Federal, state, local and foreign Taxes required to be paid by or on behalf of the payee with respect of the receipt or realization of any such amounts, and after consideration of any current tax savings of such payee resulting by way of any deduction, credit or other tax benefit attributable to such base amount or Tax, shall net such payee the full amount of such base amount. "Agreement" and "Participation Agreement" mean that certain Participation Agreement (N372DA), dated as of April 30, 2002, among Company, State Street, Pass Through Trustee under each Pass Through Trust Agreement, Subordination Agent and Loan Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its Terms. "Aircraft" means the Airframe (or any Replacement Airframe substituted therefor pursuant to Section 7.05 of the Indenture) together with the two Engines described in the Indenture Supplement originally executed and delivered under the Indenture (or any Replacement Engine that may from time to time be substituted for any of such Engines pursuant to Section 7.04 or Section 7.05 of the Indenture), whether or not any of such initial or substituted Engines is from time to time installed on such Airframe or installed on any other airframe or on any other aircraft. The term "Aircraft" includes any Replacement Aircraft. "Airframe" means (a) the Boeing 737-832 aircraft (except (i) the Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (ii) items installed or incorporated in or attached to such Boeing 737-832 aircraft from time to time that are excluded from the definition of Parts (except Engines or engines)) specified in the Indenture Supplement originally executed and delivered under the Indenture and (b) any and all related Parts. The term "Airframe" includes any Replacement Airframe that is substituted for the Airframe pursuant to Section 7.05 of the Indenture. At such time as any Replacement Airframe is so substituted and the Airframe for which such substitution is made is released from the Lien of the Indenture, such replaced Airframe shall cease to be an Airframe under the Indenture. "Bankruptcy Code" means the United States Bankruptcy Code, 11 United States Code ss.ss.101 et seq., as amended, or any successor statutes thereto. "Basic Pass Through Trust Agreement" means that certain Pass Through Trust Agreement, dated as of November 16, 2000, between Company and State Street, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms (but does not include any Trust Supplement). "Bills of Sale" means the FAA Bill of Sale and the Warranty Bill of Sale. "Business Day" means any day other than a Saturday, a Sunday or a day on which commercial banks are required or authorized to close in New York, New York, Atlanta, Georgia or the city and state in which Loan Trustee maintains its Corporate Trust Office or receives and disburses funds. "Certificated Air Carrier" means a Citizen of the United States holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the United States Code for aircraft capable of carrying ten or more individuals or 6,000 pounds or more of cargo or that otherwise is certified or registered to the extent required to fall within the purview of Section 1110. "Citizen of the United States" has the meaning specified for such term in Section 40102(a)(15) of Title 49 of the United States Code or any similar legislation of the United States enacted in substitution or replacement therefor. "Claim" has the meaning specified in Section 4.02(a) of the Participation Agreement. "Class C Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1C created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1C, dated as of April 30, 2002 between Company and State Street. "Class G-1 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-1 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Company and State Street. "Class G-1 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002 between Company and State Street. "Class G-2 Pass Through Trust" means the Delta Air Lines Pass Through Trust 2002-1G-2 created pursuant to the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Company and State Street. "Class G-2 Trustee" means Pass Through Trustee under the Basic Pass Through Trust Agreement, as supplemented by Trust Supplement No. 2002-1G-2, dated as of April 30, 2002 between Company and State Street. "Closing" has the meaning specified in Section 2.03 of the Participation Agreement. "Closing Date" means the date of the closing of the transaction contemplated by the Operative Documents. "Code" means the Internal Revenue Code of 1986, as amended. "Collateral" has the meaning specified in the granting clause of the Indenture. "Company" means Delta Air Lines, Inc., and its successors and permitted assigns. "Compulsory Acquisition" means requisition of title or other compulsory acquisition, capture, seizure, deprivation, confiscation or detention for any reason of the Aircraft by any government that results in the loss of title or use of the Aircraft by Company (or any Permitted Lessee) for a period in excess of 180 days, but shall exclude requisition for use or hire not involving requisition of title. "Confidential Information" has the meaning specified in Section 10.16 of the Indenture. "Controlling Party" has the meaning specified in Section 2.06 of the Intercreditor Agreement. "Corporate Trust Office" means the Corporate Trust Division of Loan Trustee located at State Street Bank and Trust Company of Connecticut, National Association, 225 Asylum Street, Goodwin Square, Hartford, Connecticut, 06103, Attention: Corporate Trust Division, or such other office at which Loan Trustee's corporate trust business is administered that Loan Trustee specifies by notice to Company. "CRAF Program" means the Civil Reserve Air Fleet Program authorized under 10 U.S.C. Section 9511 et seq. or any similar or substitute program under the laws of the United States. "Debt Rate" means, with respect to any Series, the rate per annum specified for such Series under the heading "Interest Rate" in Schedule I to the Indenture. "Department of Transportation" means the United States Department of Transportation and any agency or instrumentality of the United States government succeeding to its functions. "Direction" has the meaning specified in Section 2.16 of the Indenture. "Dollars" and "$" mean the lawful currency of the United States. "Engine" means (a) each of the two CFM International, Inc. CFM56-7B26 engines, which may be rated at or limited to -24 or higher power, listed by manufacturer's serial number in the Indenture Supplement originally executed and delivered under the Indenture, whether or not from time to time installed on the Airframe or installed on any other airframe or on any other aircraft and (b) any Replacement Engine substituted for an Engine pursuant to Section 7.04 or 7.05 of the Indenture; together in each case with any and all related Parts. At such time as a Replacement Engine is so substituted and the Engine for which substitution is made is released from the Lien of the Indenture, such replaced Engine shall cease to be an Engine under the Indenture. "Equipment Note" means and includes any Equipment Note originally issued pursuant to Section 2.02 of the Indenture and any Equipment Note issued in exchange therefor or replacement thereof pursuant to Section 2.07 or 2.08 of the Indenture. "Equipment Note Register" has the meaning specified in Section 2.07 of the Indenture. "Equipment Note Registrar" has the meaning specified in Section 2.07 of the Indenture. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA as in effect at the date of the Participation Agreement and any subsequent provisions of ERISA amendatory thereof, supplemental thereto or substituted therefor. "Event of Default" has the meaning specified in Section 4.01 of the Indenture. "Event of Loss" means, with respect to the Aircraft, Airframe or any Engine, any of the following events with respect to such property: (a) the loss of such property or of the use thereof due to destruction, damage beyond repair or rendition of such property permanently unfit for normal use for any reason whatsoever; (b) any damage to such property which results in an insurance settlement with respect to such property on the basis of a total loss, a compromised total loss or a constructive total loss; (c) the theft or disappearance of such property for a period in excess of 180 days; (d) the requisition for use of such property by any government (other than a requisition for use by a Government or the government of the country of registry of the Aircraft) that results in the loss of possession of such property by Company (or any Permitted Lessee) for a period in excess of 12 consecutive months; (e) the operation or location of the Aircraft, while under requisition for use by any government, in any area excluded from coverage by any insurance policy in effect with respect to the Aircraft required by the terms of Section 7.06 of the Indenture, unless Company shall have obtained indemnity or insurance in lieu thereof from such government; (f) any Compulsory Acquisition; (g) as a result of any law, rule, regulation, order or other action by the FAA or other government of the country of registry, the use of the Aircraft or Airframe in the normal business of air transportation is prohibited by virtue of a condition affecting all aircraft of the same type for a period of 18 consecutive months, unless Company is diligently carrying forward all steps that are necessary or desirable to permit the normal use of the Aircraft or Airframe or, in any event, if such use is prohibited for a period of three consecutive years; and (h) with respect to an Engine only, any divestiture of title to or interest in an Engine or any event with respect to an Engine that is deemed to be an Event of Loss with respect to such Engine pursuant to Section 7.02(a)(vii) of the Indenture. An Event of Loss with respect to the Aircraft shall be deemed to have occurred if an Event of Loss occurs with respect to the Airframe unless Company elects to substitute a Replacement Airframe pursuant to Section 7.05(a)(i) of the Indenture. "FAA" means the United States Federal Aviation Administration and any agency or instrumentality of the United States government succeeding to its functions. "FAA Bill of Sale" means the bill of sale for the Aircraft on AC Form 8050-2 executed by Manufacturer or an affiliate of Manufacturer in favor of Company and recorded with the FAA. "Federal Funds Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to 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 State Street from three Federal funds brokers of recognized standing selected by it. "Government" means the government of any of Canada, France, Germany, Japan, The Netherlands, Sweden, Switzerland, the United Kingdom or the United States and any instrumentality or agency thereof. "Indemnitee" has the meaning specified in Section 4.02(b) of the Participation Agreement. "Indenture" means that certain Indenture and Security Agreement (N372DA), dated as of April 30, 2002, between Company and Loan Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, including supplementing by an Indenture Supplement pursuant to the Indenture. "Indenture Form" means the form of Amended and Restated Indenture and Security Agreement attached as Exhibit I to the Participation Agreement. "Indenture Indemnitee" means (i) Loan Trustee, (ii) State Street, (iii) so long as it holds any Equipment Note as agent and trustee of any Pass Through Trustee, Subordination Agent, (iv) Liquidity Provider and Policy Provider and (v) so long as it is the holder of any Equipment Notes, each Pass Through Trustee and each of their respective directors, officers, employees, agents and servants. No holder of a Pass Through Certificate in its capacity as such shall be an Indenture Indemnitee. "Indenture Supplement" means a supplement to the Indenture, substantially in the form of Exhibit A to the Indenture, which particularly describes the Aircraft, and any Replacement Airframe and or Replacement Engine included in the property subject to the Lien of the Indenture. "Intercreditor Agreement" means that certain Intercreditor Agreement, dated as of the Closing Date, among Pass Through Trustees, Liquidity Provider, Policy Provider and Subordination Agent, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Interests" has the meaning specified in Section 7.06(a) of the Indenture. "Lease" means any lease permitted by the terms of Section 7.02(a) of the Indenture. "Lease Form" means the form of Lease Agreement attached as Exhibit H to the Participation Agreement. "Lien" means any mortgage, pledge, lien, encumbrance, lease, sublease, sub-sublease or security interest. "Liquidity Facilities" means the three Revolving Credit Agreements, each dated as of the Closing Date, between Subordination Agent, as borrower, and Liquidity Provider, and any replacements thereof, in each case as the same may be amended or supplemented or otherwise modified from time to time in accordance with its terms. "Liquidity Provider" means Westdeutsche Landesbank Girozentrale, a German banking institution organized under the laws of the State of North Rhine-Westphalia, acting through its New York branch, as liquidity provider under each of the Liquidity Facilities, or any liquidity provider under a replacement liquidity facility. "Loan Amount" has the meaning specified in Section 7.06(b) of the Indenture. "Loan Trustee" has the meaning specified in the introductory paragraph of the Indenture. "Loan Trustee Liens" means any Lien attributable to State Street or Loan Trustee with respect to the Aircraft, any interest therein or any other portion of the Collateral arising as a result of (i) claims against State Street or Loan Trustee not related to its interest in the Aircraft or the administration of the Collateral pursuant to the Indenture, (ii) acts of State Street or Loan Trustee not permitted by, or the failure of State Street or Loan Trustee to take any action required by the Operative Documents or the Pass Through Documents, (iii) claims against State Street or Loan Trustee relating to Taxes or Claims that are excluded from the indemnification provided by Section 4.02 of the Participation Agreement pursuant to said Section 4.02 or (iv) claims against State Street or Loan Trustee arising out of the transfer by any such party of all or any portion of its interest in the Aircraft, the Collateral, the Operative Documents or the Pass Through Documents, except while an Event of Default is continuing and prior to the time that Loan Trustee has received all amounts due to it pursuant to the Indenture. "Loss Payment Date" has the meaning specified in Section 7.05(a) of the Indenture. "Majority in Interest of Noteholders" means, as of a particular date of determination and subject to Section 2.16 of the Indenture, the holders of at least a majority in aggregate unpaid principal amount of all Equipment Notes outstanding as of such date (excluding any Equipment Notes held by Company or any affiliate thereof. "Make-Whole Amount" means, with respect to any Equipment Note, the amount (as determined by an independent investment banker selected by Company (and, following the occurrence and during the continuance of an Event of Default, reasonably acceptable to Loan Trustee)), if any, by which (i) the present value of the remaining scheduled payments of principal and interest from the redemption date to maturity of such Equipment Note computed by discounting each such payment on a semiannual basis from its respective Payment Date (assuming a 360-day year of twelve 30 day months) using a discount rate equal to the Treasury Yield exceeds (ii) the outstanding principal amount of such Equipment Note plus accrued but unpaid interest thereon. For purposes of determining the Make-Whole Amount, "Treasury Yield" means, at the date of determination, the interest rate (expressed as a semiannual equivalent and as a decimal and, in the case of United States Treasury bills, converted to a bond equivalent yield) determined to be the per annum rate equal to the semiannual yield to maturity for United States Treasury securities maturing on the Average Life Date and trading in the public securities market either as determined by interpolation between the most recent weekly average yield to maturity for two series of United States Treasury securities, trading in the public securities markets, (A) one maturing as close as possible to, but earlier than, the Average Life Date and (B) the other maturing as close as possible to, but later than, the Average Life Date, in each case as published in the most recent H.15(519) or, if a weekly average yield to maturity for United States Treasury securities maturing on the Average Life Date is reported on the most recent H.15(519), such weekly average yield to maturity as published in such H.15(519). "H.15(519)" means the weekly statistical release designated as such, or any successor publication, published by the Board of Governors of the Federal Reserve System. The date of determination of a Make-Whole Amount shall be the third Business Day prior to the applicable redemption date and the "most recent H.15(519)" means the H.15(519) published prior to the close of business on the third Business Day prior to the applicable redemption date. "Average Life Date" means, for each Equipment Note to be redeemed, the date which follows the redemption date by a period equal to the Remaining Weighted Average Life at the redemption date of such Equipment Note. "Remaining Weighted Average Life" of an Equipment Note, at the redemption date of such Equipment Note, means the number of days equal to the quotient obtained by dividing: (i) the sum of the products obtained by multiplying (A) the amount of each then remaining installment of principal, including the payment due on the maturity date of such Equipment Note, by (B) the number of days from and including the redemption date to but excluding the scheduled payment date of such principal installment by (ii) the then unpaid principal amount of such Equipment Note. "Mandatory Document Terms" has the meaning specified for such term in Exhibit L to the Participation Agreement. "Mandatory Economic Terms" has the meaning specified for such term in Exhibit M to the Participation Agreement. "Manufacturer" means The Boeing Company, a Delaware corporation, and its successors and assigns. "Manufacturer's Consent" means the Manufacturer's Consent and Agreement to Assignment of Warranties, dated as of the Closing Date, substantially in the form of Exhibit E to the Participation Agreement "Noteholder" means any Person in whose name an Equipment Note is registered on the Equipment Note Register (including, for so long as it is the registered holder of any Equipment Notes, Subordination Agent on behalf of Pass Through Trustees pursuant to the provisions of the Intercreditor Agreement). "Noteholder Liens" means any Lien attributable to any Noteholder on or against the Aircraft, any interest herein or any portion of the Collateral, arising out of any claim against such Noteholder that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such Noteholder that is not related to the transactions contemplated by, or that constitutes a breach by such Noteholder of its obligations under, the Operative Documents or the Pass Through Documents. "Operative Documents" means, collectively, the Participation Agreement, the Indenture, each Indenture Supplement, the Manufacturer's Consent and the Equipment Notes. "Other Party Liens" means any Lien attributable to Pass Through Trustee (other than in its capacity as Noteholder), Subordination Agent (other than in its capacity as Noteholder), Liquidity Provider or Policy Provider on or against the Aircraft, any interest therein, or any portion of the Collateral arising out of any claim against such party that is not related to the Operative Documents or Pass Through Documents, or out of any act or omission of such party that is not related to the transactions contemplated by, or that constitutes a breach by such party of its obligations under, the Operative Documents or the Pass Through Documents. "Participation Agreement" has the meaning set forth under the definition of "Agreement". "Participation Agreement Form" means the form of Amended and Restated Participation Agreement attached as Exhibit G to the Participation Agreement. "Parts" means any and all appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment of whatever nature (other than (a) complete Engines or engines, (b) any items leased by Company or any Permitted Lessee, (c) cargo containers, (d) components or systems installed on or affixed to the Airframe that are used to provide individual telecommunications or electronic entertainment to passengers aboard the Aircraft, (e) medical and similar emergency equipment and (f) passenger service items and equipment generally used in but not affixed to the Aircraft, such as blankets, coffee pots, beverage and meal servicing carts, etc.), so long as the same are incorporated or installed in or attached to the Airframe or any Engine or so long as the same are subject to the Lien of the Indenture in accordance with the terms of Section 7.04 thereof after removal from the Airframe or any Engine. "Pass Through Certificates" means the pass through certificates issued by Pass Through Trustees. "Pass Through Documents" means the Pass Through Trust Agreements, the Intercreditor Agreement, the Liquidity Facilities and the Policy Provider Agreement. "Pass Through Trust" means each of the three separate grantor trusts created pursuant to the Pass Through Trust Agreements to facilitate certain of the transactions contemplated by the Operative Documents. "Pass Through Trust Agreement" means each of the three separate Trust Supplements together in each case with the Basic Pass Through Trust Agreement, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Pass Through Trustee" has the meaning specified in the introductory paragraph to the Participation Agreement. "Pass Through Trustees" means, collectively, Pass Through Trustees under each Pass Through Trust Agreement. "Past Due Rate" means, with respect to a particular Series, a rate per annum equal to the applicable Debt Rate plus 1% and, in any case other than with respect to a particular Series, the Debt Rate for the Series G-2 Equipment Notes plus 1%. "Payment Date" means, for any Equipment Note, each July 2 and January 2, commencing with January 2, 2003. "Payment Default" means the occurrence of an event that would give rise to an Event of Default under Section 4.01(a) of the Indenture upon the giving of notice or the passing of time or both. "Permitted Investments" means each of (a) direct obligations of the United States and agencies thereof; (b) obligations fully guaranteed by the United States; (c) certificates of deposit issued by, or bankers' acceptances of, or time deposits with, any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. ("S&P") (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (d) commercial paper of any holding company of a bank, trust company or national banking association described in clause (c); (e) commercial paper of companies having a rating assigned to such commercial paper by either Moody's or S&P (or, if neither such organization then rates such commercial paper, by any nationally recognized rating organization in the United States) equal to either of the two highest ratings assigned by such organization; (f) Dollar-denominated certificates of deposit issued by, or time deposits with, the European subsidiaries of (i) any bank, trust company or national banking association described in clause (c), or (ii) any other bank or financial institution described in clause (h) or (i) below; (g) United States-issued Yankee certificates of deposit issued by, or bankers' acceptances of, or commercial paper issued by, any bank having combined capital and surplus and retained earnings of at least $100,000,000 and headquartered in Canada, Japan, the United Kingdom, France, Germany, Switzerland or The Netherlands and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (h) Dollar-denominated time deposits with any Canadian bank having a combined capital and surplus and retained earnings of at least $100,000,000 and having a rating of A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such institutions, by any nationally recognized rating organization in the United States); (i) Canadian Treasury Bills fully hedged to Dollars; (j) repurchase agreements with any financial institution having combined capital and surplus and retained earnings of at least $100,000,000 collateralized by transfer of possession of any of the obligations described in clauses (a) through (i) above; (k) bonds, notes or other obligations of any state of the United States, or any political subdivision of any state, or any agencies or other instrumentalities of any such state, including, but not limited to, industrial development bonds, pollution control revenue bonds, public power bonds, housing bonds, other revenue bonds or any general obligation bonds, that, at the time of their purchase, such obligations are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (1) bonds or other debt instruments of any company, if such bonds or other debt instruments, at the time of their purchase, are rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States); (m) mortgage backed securities (i) guaranteed by the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation or the Government National Mortgage Association or rated AAA, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee and (ii) having an average life not to exceed 15 years as determined by standard industry pricing practices presently in effect; (n) asset-backed securities rated A, its equivalent or better by Moody's or S&P (or, if neither such organization then rates such obligations, by any nationally recognized rating organization in the United States) or, if unrated, deemed to be of a comparable quality by Loan Trustee; and (o) such other investments approved in writing by Loan Trustee; provided that, except in clause (m), the instruments described in the foregoing clauses shall have a maturity of no more than six months from the date of acquisition thereof. The bank acting as Pass Through Trustee or Loan Trustee is hereby authorized, in making or disposing of any investment described herein, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or such affiliate is acting as an agent of Pass Through Trustee or Loan Trustee or for any third person or dealing as principal for its own account. "Permitted Lessee" means any Person to whom Company is permitted to lease the Airframe or any Engine pursuant to Section 7.02(a) of the Indenture. "Permitted Lien" has the meaning specified in Section 7.01 of the Indenture. "Person" means any person, including any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, trustee, unincorporated organization or government or any agency or political subdivision thereof. "Policy Provider" means MBIA Insurance Company, a New York-domiciled stock insurance company. "Policy Provider Agreement" means the Insurance and Indemnity Agreement dated as of April 30, 2002 among Subordination Agent, Class G-1 Trustee, Class G-2 Trustee, Company and Policy Provider, including the related Policy Provider Fee Letter referred to therein, as amended, supplemented or otherwise modified from time to time in accordance with its terms. "Purchase Agreement" means Purchase Agreement No. 2022, dated as of October 21, 1997, which incorporates by reference the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, between Manufacturer and Company, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Rating Agencies" has the meaning specified in the Intercreditor Agreement. "Related Indemnitee Group" has the meaning specified in Section 4.02(b) of the Participation Agreement. "Replacement Aircraft" means the Aircraft of which a Replacement Airframe is part. "Replacement Airframe" means a Boeing 737-832 aircraft or a comparable or improved model of Manufacturer (except (a) Engines or engines from time to time installed thereon and any and all Parts related to such Engine or engines and (b) items excluded from the definition of Parts (except Engines or engines)), that shall have been made subject to the Lien of the Indenture pursuant to Section 7.05 thereof, together with all Parts relating to such aircraft. "Replacement Engine" means a CFM International, Inc. CFM56-7B engine, which may be rated at or limited to -24 or higher power, (or an engine of the same or another manufacturer of a comparable or an improved model and suitable for installation and use on the Airframe with the other Engine (or any other Replacement Engine being substituted simultaneously therewith)) that is made subject to the Lien of the Indenture pursuant to Section 7.04 or Section 7.05 thereof, together with all Parts relating to such engine. "Responsible Officer" means, with respect to Company, its Chairman of the Board, its President, its Chief Operating Officer, any Executive Vice President, any Senior Vice President, the Chief Financial Officer, any Vice President, the Treasurer, the Controller or the Secretary. "Sale/Leaseback Transaction" has the meaning specified for such term in Section 7.11 of the Participation Agreement. "Section 1110" means Section 1110 of the Bankruptcy Code. "Secured Obligations" has the meaning specified in Section 2.06 of the Indenture. "Series" means any series of Equipment Notes, including the Series G-1 Equipment Notes, the Series G-2 Equipment Notes, or the Series C Equipment Notes. "Series C Equipment Notes" means Equipment Notes issued and designated as "Series C Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series C Equipment Notes." "Series G-1 Equipment Notes" means Equipment Notes issued and designated as "Series G-1 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-1 Equipment Notes." "Series G-2 Equipment Notes" means Equipment Notes issued and designated as "Series G-2 Equipment Notes" under the Indenture, in the original principal amount and maturities and bearing interest as specified in Schedule I to the Indenture under the heading "Series G-2 Equipment Notes." "State Street" has the meaning specified in the introductory paragraph of the Participation Agreement. "Subordination Agent" has the meaning specified in the introductory paragraph of the Participation Agreement. "Tax" and "Taxes" mean all governmental fees (including, without limitation. license, filing and registration fees) and all taxes (including, without limitation, franchise, excise, stamp, value added, income, gross receipts, sales, use and property taxes), withholdings, assessments, levies, imposts, duties or charges, of any nature whatsoever, together with any related penalties, fines, additions to tax or interest thereon imposed, withheld, levied or assessed by any country, taxing authority or governmental subdivision thereof or therein or by any international authority, including any taxes imposed on any Person as a result of such Person being required to collect and pay over withholding taxes. "Transportation Code" means that portion of Title 49 of the United States Code comprising those provisions formerly referred to as the Federal Aviation Act of 1958, as amended, or any subsequent legislation that amends, supplements or supersedes such provisions. "Trust Supplements" means those agreements supplemental to the Basic Pass Through Trust Agreement referred to in Schedule II to the Participation Agreement. "Underwriters" means the several underwriters listed as such in the Underwriting Agreement. "Underwriting Agreement" means that certain Underwriting Agreement, dated April 23, 2002, among Company and Underwriters. "United States" means the United States of America. "U.S. Government Obligations" means securities that are direct obligations of the United States for the payment of which its full faith and credit is pledged which are not callable or redeemable, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligations or a specific payment of interest on or principal of any such U.S. Government Obligations held by such custodian for the account of the holder of a depository receipt so long as such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of interest on or principal of the U.S. Government Obligations evidenced by such depository receipt. "Warranty Bill of Sale" means the warranty (as to title) bill of sale covering the Aircraft executed by Manufacturer or an affiliate of Manufacturer in favor of Company and specifically referring to each Engine, as well as the Airframe, constituting a part of the Aircraft. "Warranty Rights" means all right and interest of Company in, to and under Parts 1, 2, 3, 4 and 6 of the Product Assurance Document attached as Exhibit C to the Aircraft General Terms Agreement AGTA-DAL, dated as of October 21, 1997, but only to the extent the same relate to continuing rights of Company in respect of any warranty or indemnity, express or implied, pursuant to the Product Assurance Document with respect to the Airframe, it being understood that the Warranty Rights exclude any and all other right, title and interest of Company in, to and under the Purchase Agreement and that the Warranty Rights are subject to the terms of the Manufacturer's Consent. EX-4.(E)(4) 14 de763576-ex4e4.txt PARTICIPATION AGREEMENT EXHIBIT 4(e)(4) ================================================================================ PARTICIPATION AGREEMENT (N833MH) Dated as of April 30, 2002 among DELTA AIR LINES, INC., STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein --------------- One Boeing 767-432ER Aircraft U.S. Registration No. N833MH ================================================================================ TABLE OF CONTENTS Page ---- ARTICLE 1 DEFINITIONS Section 1.01 Definitions................................................. Section 1.02 Other Definitional Provisions............................... ARTICLE 2 THE LOANS Section 2.01 The Loans.................................................... Section 2.02 Issuance of Equipment Notes.................................. Section 2.03 The Closing.................................................. ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to Obligations of Pass Through Trustees.................................................. Section 3.02 Conditions Precedent to Obligations of Company.............. ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY Section 4.01 Representations and Warranties of Company................... Section 4.02 General Indemnity........................................... ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF STATE STREET Section 5.01 Representations, Warranties and Covenants of State Street............................................. ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements............................................ Section 6.02 Certain Covenants of Company................................ ARTICLE 7 MISCELLANEOUS Section 7.01 Notices..................................................... Section 7.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements.................... Section 7.03 Governing Law............................................... Section 7.04 Severability................................................ Section 7.05 No Oral Modifications or Continuing Waivers; Consents....... Section 7.06 Effect of Headings and Table of Contents.................... Section 7.07 Successors and Assigns...................................... Section 7.08 Benefits of Agreement....................................... Section 7.09 Counterparts................................................ Section 7.10 Submission to Jurisdiction.................................. Schedule I - Equipment Notes, Purchasers and Original Principal Amounts Schedule II - Trust Supplements Exhibit A-1 - Form of Opinion of Counsel for Company Exhibit A-2 - Form of Opinion of Cadwalader, Wickersham & Taft, special counsel for Company Exhibit A-3 - Form of ss. 1110 Opinion of Cadwalader, Wickersham & Taft, special counsel for Company Exhibit B - Form of Opinion of Special Counsel for Loan Trustee, Subordination Agent and State Street Exhibit C - Form of Opinion of Special FAA Counsel Exhibit D-1 - Form of Opinion of Special Counsel for Liquidity Provider Exhibit D-2 - Form of Opinion of German In-House Counsel for Liquidity Provider Exhibit E - Form of Manufacturer's Consent Exhibit F - Form of Opinion of Special Counsel for Pass Through Trustees Exhibit G - Form of Opinion of Special Counsel for Policy Provider Annex A - Definitions PARTICIPATION AGREEMENT (N833MH) This PARTICIPATION AGREEMENT (N833MH), dated as of April 30, 2002, is made by and among DELTA AIR LINES, INC., a Delaware corporation (together with its successors and permitted assigns, "Company"), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association (in its individual capacity, together with its successors and permitted assigns, "State Street"), not in its individual capacity except as otherwise expressly provided in any of the Operative Documents or the Pass Through Documents, but solely as trustee (in such capacity together with any successor or other trustee in such capacity, "Pass Through Trustee") under each of the Pass Through Trust Agreements (such term and other capitalized terms used herein without definition being defined as provided in Section 1.01), STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, as subordination agent and trustee (in such capacity, together with any successor trustee in such capacity, "Subordination Agent") under the Intercreditor Agreement, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as loan trustee (in such capacity, together with any successor trustee in such capacity, "Loan Trustee") under the Indenture. W I T N E S S E T H: WHEREAS, Company is the owner of that certain Boeing Model 767-432ER aircraft more particularly described in the Indenture Supplement originally executed and delivered under the Indenture; WHEREAS, concurrently with the execution and delivery of this Agreement, Company and Loan Trustee are entering into the Indenture, pursuant to which, among other things, Company will issue four series of Equipment Notes, which Equipment Notes are to be secured by a security interest in all right, title and interest of Company in and to the Aircraft and certain other property described in the Indenture; WHEREAS, pursuant to the Basic Pass Through Trust Agreement and each of the Trust Supplements set forth in Schedule II, concurrently with the execution and delivery of this Agreement, separate Pass Through Trusts are being created to facilitate certain of the transactions contemplated hereby, including, without limitation, the issuance and sale of Pass Through Certificates; WHEREAS, pursuant to the Intercreditor Agreement, Subordination Agent will hold the Equipment Notes on behalf of the Pass Through Trusts; NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements herein contained, and of other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS Section 1.01 Definitions. For the purposes of this Agreement, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Agreement to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Agreement, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) All references in this Agreement to a "government" are to such government and any instrumentality or agency thereof. (e) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". ARTICLE 2 THE LOANS Section 2.01 The Loans. Subject to the terms and conditions of this Agreement and the Indenture, on the Closing Date Pass Through Trustee for each Pass Through Trust shall make a loan to Company by paying to Company the aggregate original principal amounts of the Equipment Notes being issued to such Pass Through Trust as set forth on Schedule I opposite the name of such Pass Through Trust. Pass Through Trustees, on behalf of the Pass Through Trusts, shall make such loans to Company no later than 11:00 a.m. (New York City time) on the Closing Date by transferring such amount in immediately available funds to Company at its account at Citibank, N.A., 111 Wall Street, New York, New York, Account No. 40002617, ABA Number 021000089, with the request that the bank advise Company by telephone at (404) 715-2046 upon transfer of the funds. Section 2.02 Issuance of Equipment Notes. Upon the occurrence of the above payments by Pass Through Trustee for each Pass Through Trust to Company, Company shall issue, pursuant to and in accordance with Article II of the Indenture, to Subordination Agent as agent and trustee for Pass Through Trustee for each Pass Through Trust, one or more Equipment Notes of the maturity and aggregate principal amount and bearing the interest rate set forth in Schedule I opposite the name of such Pass Through Trust. Each such Equipment Note shall be duly authenticated by Loan Trustee pursuant to the Indenture, registered in the name of Subordination Agent and dated the Closing Date and shall be delivered by Loan Trustee to Subordination Agent. Section 2.03 The Closing. The closing (the "Closing") of the transactions contemplated hereby shall take place at the offices of Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York at 9:30 a.m. (New York City time) on April 30, 2002, or at such other time or place as the parties shall agree. ARTICLE 3 CONDITIONS PRECEDENT Section 3.01 Conditions Precedent to Obligations of Pass Through Trustees. The obligation of each Pass Through Trustee to make the loan contemplated by Article II is subject to the fulfillment (or the waiver by such Pass Through Trustee) prior to or on the Closing Date of the following conditions precedent: (a) Company shall have tendered the Equipment Notes to Loan Trustee for authentication, and Loan Trustee shall have authenticated such Equipment Notes and shall have tendered the Equipment Notes to Subordination Agent on behalf of the applicable Pass Through Trustee in accordance with Section 2.02. (b) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Pass Through Trustees to make the loans contemplated by Section 2.01 or to acquire the Equipment Notes. (c) This Agreement and the following documents shall have been duly authorized, executed and delivered by the respective party or parties thereto (other than Pass Through Trustees or Loan Trustee), shall be in full force and effect and executed counterparts (or copies thereof where indicated) thereof shall have been delivered to each Pass Through Trustee: (i) the Intercreditor Agreement; (ii) the Liquidity Facilities; (iii) the Pass Through Trust Agreements; (iv) the Indenture and the Indenture Supplement covering the Aircraft and dated the Closing Date; (v) the Manufacturer's Consent; (vi) a copy of the FAA Bill of Sale; and (vii) a copy of the Warranty Bill of Sale. (d) A Uniform Commercial Code financing statement or statements covering the security interest created by the Indenture shall have been executed and delivered by Company, as debtor, and by Loan Trustee, as secured party, and such financing statement or statements shall have been duly filed in all places necessary or desirable within the State of Delaware. (e) Each Pass Through Trustee shall have received the following: (i) a certificate dated the Closing Date of the Secretary or an Assistant Secretary of Company, certifying as to (A) a copy of the resolutions of the Board of Directors of Company or the executive committee thereof duly authorizing the transactions contemplated hereby and the execution, delivery and performance by Company of this Agreement and the Indenture and each other document required to be executed and delivered by Company in accordance with the provisions hereof or thereof and (B) a copy of the certificate of incorporation and by-laws of Company, as in effect on the Closing Date; (ii) a certificate or other evidence from the Secretary of State of the State of Delaware, dated as of a date reasonably near the Closing Date, as to the due incorporation and good standing of Company in such state; (iii) an incumbency certificate of Company as to the person or persons authorized to execute and deliver this Agreement, the Indenture and each other document to be executed by Company in connection with the transactions contemplated hereby and thereby, and the specimen signatures of such person or persons; and (iv) one or more certificates of Loan Trustee and Subordination Agent certifying to the reasonable satisfaction of Pass Through Trustees as to the due authorization, execution, delivery and performance by Loan Trustee and Subordination Agent of each of the Operative Documents to which Loan Trustee or Subordination Agent is or will be a party and any other documents to be executed by or on behalf of Loan Trustee or Subordination Agent in connection with the transactions contemplated hereby or thereby. (f) On the Closing Date, the following statements shall be correct: (i) the representations and warranties of Company herein are correct in all material respects as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties are correct on and as of such earlier date) and (ii) no event has occurred and is continuing that constitutes an Event of Default or an Event of Loss or would constitute an Event of Default or Event of Loss but for the requirement that notice be given or time elapse or both. (g) Each Pass Through Trustee and Loan Trustee shall have received (i) an opinion addressed to it from the General Counsel or an Associate General Counsel of Company (or such other internal counsel to Company as shall be reasonably satisfactory to Pass Through Trustees) substantially in the form set forth in Exhibit A-1 and (ii) opinions addressed to it from Cadwalader, Wickersham & Taft substantially in the forms set forth in Exhibits A-2 and A-3. (h) Each Pass Through Trustee and Loan Trustee shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for State Street, Loan Trustee and Subordination Agent, substantially in the form set forth in Exhibit B. (i) Each Pass Through Trustee and Loan Trustee shall have received an opinion addressed to it from Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma, substantially in the form set forth in Exhibit C. (j) Each Pass Through Trustee and Loan Trustee shall have received a certificate or certificates signed by the chief financial or accounting officer, any Senior Vice President, the Treasurer, any Vice President or any Assistant Treasurer (or any other Responsible Officer) of Company, dated the Closing Date, certifying as to the correctness of each of the matters stated in Section 3.01(f). (k) Each Pass Through Trustee shall have received a certificate from State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, dated the Closing Date, signed by an authorized officer of State Street in its individual capacity and as Loan Trustee and Subordination Agent, as applicable, certifying for each such entity that no Loan Trustee Liens or Other Party Liens attributable to it, as applicable, exist, and further certifying as to the correctness of each of the matters stated in Section 5.01. (l) Each Pass Through Trustee shall have received opinions addressed to it from Milbank, Tweed, Hadley & McCloy LLP, special counsel for Liquidity Provider, substantially in the form set forth in Exhibit D-1, and from German in-house counsel for Liquidity Provider, substantially in the form set forth in Exhibit D-2. (m) Loan Trustee shall have received an insurance report of an independent insurance broker and the related certificates of insurance, each in form and substance reasonably satisfactory to Loan Trustee, as to the compliance with the terms of Section 7.06 of the Indenture relating to insurance with respect to the Aircraft. (n) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (o) Company shall have entered into the Underwriting Agreement, the Pass Through Certificates shall have been issued and sold pursuant to the Underwriting Agreement and the Underwriters shall have transferred to Pass Through Trustees in immediately available funds an amount at least equal to the aggregate purchase price of the Equipment Notes to be purchased from Company. (p) Loan Trustee shall have received an executed copy of the Manufacturer's Consent substantially in the form set forth in Exhibit E. (q) Each Pass Through Trustee shall have received an opinion from Latham & Watkins, special counsel to the Policy Provider, substantially in the form set forth in Exhibit G. Promptly upon the recording of the Indenture (with the Indenture Supplement attached) pursuant to the Transportation Code, Company will cause Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma to deliver to Subordination Agent on behalf of Pass Through Trustees, to Loan Trustee and to Company an opinion as to the due recording of such instrument and the lack of filing of any intervening documents with respect to the Aircraft. Section 3.02 Conditions Precedent to Obligations of Company. The obligation of Company to issue and sell the Equipment Notes is subject to the fulfillment (or waiver by Company) prior to or on the Closing Date of the following conditions precedent: (a) No change shall have occurred after the date of this Agreement in applicable law or regulations thereunder or interpretations thereof by appropriate regulatory authorities or any court that would make it a violation of law or governmental regulations for Company to enter into any transaction contemplated by the Operative Documents or the Pass Through Trust Agreements. (b) The documents referred to in Section 3.01(c) shall have been duly authorized, executed and delivered by the respective party or parties thereto (other than Company), shall be in full force and effect and executed counterparts (or copies thereof where indicated) thereof shall have been delivered to Company, and Company shall have received such documents and evidence with respect to State Street, Liquidity Provider, Policy Provider, Loan Trustee, Subordination Agent and each Pass Through Trustee as Company reasonably requests in order to establish the consummation of the transactions contemplated by this Agreement, the taking of all corporate and other proceedings in connection therewith and compliance with the conditions herein set forth. (c) The Indenture (with the Indenture Supplement covering the Aircraft attached) shall have been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code. (d) On the Closing Date, the representations and warranties herein of State Street, Loan Trustee, Subordination Agent and Pass Through Trustees shall be correct as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties shall have been correct on and as of such earlier date), and, insofar as such representations and warranties concern State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee, such party shall have so certified to Company. (e) Company shall have received each opinion referred to in Subsections 3.01(h), 3.01(i), 3.01(l) and 3.01(q), each such opinion (other than 3.01(l)) addressed to Company or accompanied by a letter from the counsel rendering such opinion authorizing Company to rely on such opinion as if it were addressed to Company, and the certificates referred to in Subsections 3.01(e)(iv) and 3.01(k). (f) Company shall have received an opinion addressed to it from Bingham Dana LLP, special counsel for Pass Through Trustees, substantially in the form set forth in Exhibit F. (g) No action or proceeding shall have been instituted nor shall governmental action be threatened before any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed to be issued by any court or governmental agency at the time of the Closing to set aside, restrain, enjoin or prevent the completion and consummation of this Agreement or the transactions contemplated hereby. (h) Company shall have received a certificate from State Street dated the Closing Date, signed by an authorized officer of State Street, certifying for each Pass Through Trustee that no Other Party Liens attributable to it exist and further certifying as to the correctness of each of the matters stated in Section 5.01. (i) Company shall have been paid by Pass Through Trustee for each Pass Through Trust the aggregate original principal amount of the Equipment Notes being issued to such Pass Through Trust as set forth on Schedule I opposite the name of such Pass Through Trust. ARTICLE 4 REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY Section 4.01 Representations and Warranties of Company. Company represents and warrants that: (a) Company is a corporation duly incorporated and validly existing in good standing under the laws of the State of Delaware, is a Certificated Air Carrier, is a Citizen of the United States, has the corporate power and authority to own its properties or hold them under lease and to enter into and perform its obligations under the Operative Documents to which it is a party and is duly qualified to do business as a foreign corporation in good standing in each other jurisdiction in which the failure to so qualify would have a material adverse effect on the consolidated financial condition of Company and its subsidiaries, considered as a whole, and its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Georgia) is Delaware. (b) The execution, delivery and performance by Company of this Agreement and the other Operative Documents to which Company is a party have been duly authorized by all necessary corporate action on the part of Company, do not require any stockholder approval or approval or consent of any trustee or holder of any indebtedness or obligations of Company, except such as have been duly obtained and are in full force and effect, and do not contravene any law, governmental rule, regulation, judgment or order binding on Company or the certificate of incorporation or by-laws of Company or contravene or result in a breach of, or constitute a default under, or result in the creation of any Lien (other than as permitted under the Indenture) upon the property of Company under, any material indenture, mortgage, contract or other agreement to which Company is a party or by which it or any of its properties may be bound or affected. (c) Neither the execution and delivery by Company of this Agreement and the other Operative Documents to which it is a party, nor the consummation by Company of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with or the taking of any other action in respect of, the Department of Transportation, the FAA or any other federal or state governmental authority or agency, except for (i) the registration of the Pass Through Certificates (other than the Class D Pass Through Certificates) under the Securities Act of 1933, as amended, and under the securities laws of any state in which the Pass Through Certificates may be offered for sale if the laws of such state require such action, (ii) the qualification of the Pass Through Trust Agreements under the Trust Indenture Act of 1939, as amended, (iii) the orders, permits, waivers, exemptions, authorizations and approvals of the regulatory authorities having jurisdiction over Company's operation of the Aircraft required to be obtained on or prior to the Closing Date, which orders, permits, waivers, exemptions, authorizations and approvals have been duly obtained and are, or on the Closing Date will be, in full force and effect, (iv) the filings referred to in Section 4.01(e) and (v) consents, approvals, notices, registrations and other actions required to be obtained, given, made or taken only after the date hereof. (d) This Agreement and each other Operative Document to which Company is a party have been duly executed and delivered by Company and constitute the legal, valid and binding obligations of Company enforceable against Company in accordance with their terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity and except, in the case of the Indenture, as limited by applicable laws that may affect the remedies provided in the Indenture. (e) Except for (i) the filing for recordation pursuant to the Transportation Code of the Indenture (with the Indenture Supplement covering the Aircraft attached) and (ii) with respect to the security interests created by such documents, the filing of financing statements (and continuation statements at periodic intervals) under the Uniform Commercial Code of Georgia, no further filing or recording of any document is necessary under the laws of the United States or any state thereof as of the Closing Date in order to establish and perfect the security interest in the Aircraft created under the Indenture in favor of Loan Trustee as against Company and any third parties in any applicable jurisdiction in the United States. (f) Company is not an investment company or a company controlled by an investment company within the meaning of the Investment Company Act of 1940, as amended. (g) As of the Closing Date, (i) Company has good title to the Aircraft, free and clear of Liens other than Permitted Liens, (ii) the Aircraft has been duly certificated by the FAA as to type and airworthiness in accordance with the terms of the Indenture, (iii) the Indenture (with the Indenture Supplement covering the Aircraft attached) has been duly filed for recordation (or shall be in the process of being so duly filed for recordation) with the FAA pursuant to the Transportation Code and (iv) the Aircraft is duly registered with the FAA in the name of Company. Section 4.02 General Indemnity. (a) Claims Defined. For the purposes of this Section 4.02, "Claims" means any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs or expenses of whatsoever kind and nature (whether or not on the basis of negligence, strict or absolute liability or liability in tort) that may be imposed on, incurred by, suffered by or asserted against an Indemnitee, as defined below, and, except as otherwise expressly provided in this Section 4.02, includes all reasonable out-of-pocket costs, disbursements and expenses (including reasonable out-of-pocket legal fees and expenses) actually incurred by an Indemnitee in connection therewith or related thereto. (b) Indemnitee Defined. For the purposes of this Section 4.02, "Indemnitee" means (i) State Street and Loan Trustee, (ii) so long as it holds any Equipment Notes as agent and trustee of any Pass Through Trustee, Subordination Agent, (iii) so long as it is the holder of any Equipment Notes, each Pass Through Trustee, (iv) Liquidity Provider and Policy Provider and (v) each of their respective successors and permitted assigns in such capacities, agents, servants, officers, employees and directors (the respective agents, servants, officers, employees and directors of each of the foregoing Indemnitees, as applicable, together with such Indemnitee, being collectively the "Related Indemnitee Group" of such Indemnitee); provided that such Persons, to the extent they are not signatories to this Agreement, have expressly agreed in writing to be bound by the terms of this Section 4.02 prior to, or concurrently with, the making of a Claim. If any Indemnitee fails to comply with any duty or obligation under this Section 4.02 with respect to any Claim, such Indemnitee shall not be entitled to any indemnity with respect to such Claim under this Section 4.02 to the extent such failure was prejudicial to Company. No holder of a Pass Through Certificate in its capacity as such holder shall be an Indemnitee. (c) Claims Indemnified. Subject to the exclusions stated in Subsection 4.02(d), Company agrees to indemnify, protect, defend and hold harmless on an After-Tax Basis each Indemnitee against Claims resulting from or arising out of the sale, purchase, acceptance, non-acceptance or rejection of the Aircraft under the Purchase Agreement or the ownership, possession, use, non-use, substitution, airworthiness, control, maintenance, repair, operation, registration, re-registration, condition, sale, lease, sublease, storage, modification, alteration, return, transfer or other disposition of the Aircraft, the Airframe, any Engine or any Part (including, without limitation, latent or other defects, whether or not discoverable, and any claim for patent, trademark or copyright infringement) by Company, any Permitted Lessee or any other Person. Without limiting the foregoing and subject to, and without duplication of, the provisions of Section 6.01(a), Company agrees to pay the reasonable ongoing fees, and the reasonable out-of-pocket costs and expenses actually incurred (including, without limitation, reasonable attorney's fees and disbursements actually incurred and, to the extent payable as provided in the Indenture, reasonable compensation and expenses of Loan Trustee's agents actually incurred), of Loan Trustee in connection with the transactions contemplated hereby. (d) Claims Excluded. The following are excluded from Company's agreement to indemnify an Indemnitee under this Section 4.02: (i) any Claim to the extent such Claim is attributable to acts or events occurring after (x) the Equipment Notes have been paid in full or (y) the transfer of possession of the Aircraft pursuant to Article IV of the Indenture except to the extent that such Claim is attributable to acts occurring in connection with the exercise of remedies pursuant to Section 4.02 of the Indenture following the occurrence and continuance of an Event of Default; (ii) any Claim to the extent such Claim is, or is attributable to, a Tax; (iii) any Claim to the extent such Claim is attributable to the negligence or willful misconduct of such Indemnitee or such Indemnitee's Related Indemnitee Group; (iv) any Claim to the extent such Claim is attributable to the noncompliance by such Indemnitee or such Indemnitee's Related Indemnitee Group with any of the terms of, or any misrepresentation by an Indemnitee or its Related Indemnitee Group contained in, this Agreement, any other Operative Document or any Pass Through Document to which such Indemnitee or any of such Related Indemnitee Group is a party or any agreement relating hereto or thereto; (v) any Claim to the extent such Claim constitutes a Permitted Lien attributable to such Indemnitee; (vi) any Claim to the extent such Claim is attributable to the offer, sale, assignment, transfer, participation or other disposition (whether voluntary or involuntary) by or on behalf of such Indemnitee or its Related Indemnitee Group (other than during the occurrence and continuance of an Event of Default provided that any such offer, sale, assignment, transfer, participation or other disposition during the occurrence and continuation of an Event of Default shall not be subject to indemnification unless it is made in accordance with the Indenture and applicable law) of any Equipment Note or Pass Through Certificate, all or any part of such Indemnitee's interest in the Operative Documents or the Pass Through Documents or any interest in the Collateral or any similar security; (vii) any Claim to the extent such Claim is attributable to (A) a failure on the part of Loan Trustee to distribute in accordance with this Agreement or the Indenture any amounts received and distributable by it hereunder or thereunder, (B) a failure on the part of Subordination Agent to distribute in accordance with the Intercreditor Agreement any amounts received and distributable by it thereunder or (C) a failure on the part of any Pass Through Trustee to distribute in accordance with the Pass Through Trust Agreement to which it is a party any amounts received and distributable by it thereunder; (viii) any Claim to the extent such Claim is attributable to the authorization or giving or withholding of any future amendments, supplements, waivers or consents with respect to any Operative Document or any Pass Through Document, other than such as have been requested by Company or that occur as the result of an Event of Default, or such as are expressly required or contemplated by the provisions of the Operative Documents or the Pass Through Documents; (ix) any Claim to the extent such Claim is payable or borne by (a) Company pursuant to any indemnification, compensation or reimbursement provision of any other Operative Document or any Pass Through Document or (b) a Person other than Company pursuant to any provision of any Operative Document or any Pass Through Document; (x) any Claim to the extent such Claim is an ordinary and usual operating or overhead expense or not an out-of-pocket expense actually incurred; (xi) any Claim to the extent such Claim is incurred on account of or asserted as a result of any "prohibited transaction" within the meaning of Section 406 of ERISA or Section 4975 of the Code; (xii) any Claim to the extent such Claim is attributable to one or more of the other aircraft financed through the offering of Pass Through Certificates (in the event of doubt, any Claim shall be allocated between the Aircraft and such other aircraft in the same proportion that the then outstanding Equipment Notes bear to the then outstanding equipment notes issued with respect to the other aircraft and held by Pass Through Trustees); and (xiii) any Claim by an Indemnitee related to the status of such Indemnitee as a passenger or shipper on any of Company's aircraft or as a party to a marketing or promotional or other commercial agreement with Company. (e) Insured Claims. In the case of any Claim indemnified by Company hereunder that is covered by a policy of insurance maintained by Company, each Indemnitee agrees to cooperate, at Company's expense, with the insurers in the exercise of their rights to investigate, defend and compromise such Claim. (f) Claims Procedure. An Indemnitee shall promptly notify Company of any Claim as to which indemnification is sought. The failure to provide such prompt notice shall not release Company from any of its obligations to indemnify hereunder except to the extent that Company is prejudiced by such failure or Company's indemnification obligations are increased as a result of such failure. Such Indemnitee shall promptly submit to Company all additional information in such Indemnitee's possession to substantiate such Claim as Company reasonably requests. Subject to the rights of Company's insurers, Company may, at its sole cost and expense, investigate any Claim, and may in its sole discretion defend or compromise any Claim. At Company's expense, any Indemnitee shall cooperate with all reasonable requests of Company in connection therewith. Such Indemnitee shall not enter into a settlement or other compromise with respect to any Claim without the prior written consent of Company, which consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives its right to be indemnified with respect to such Claim. Where Company or its insurers undertake the defense of an Indemnitee with respect to a Claim, no additional legal fees or expenses of such Indemnitee in connection with the defense of such Claim shall be indemnified hereunder unless such fees or expenses were incurred at the written request of Company or such insurers. Subject to the requirements of any policy of insurance, an Indemnitee may participate at its own expense in any judicial proceeding controlled by Company pursuant to the preceding provisions; provided that such party's participation does not, in the opinion of counsel appointed by Company or its insurers to conduct such proceedings, interfere with such control. Such participation shall not constitute a waiver of the indemnification provided in this Section 4.02. Notwithstanding anything to the contrary contained herein, Company shall not under any circumstances be liable for the fees and expenses of more than one counsel for all Indemnitee with respect to any one Claim. (g) Subrogation. To the extent that a Claim is in fact paid in full by Company or its insurer, Company or such insurer (as the case may be) shall, without any further action, be subrogated to the rights and remedies of the Indemnitee on whose behalf such Claim was paid with respect to the transaction or event giving rise to such Claim. Such Indemnitee shall give such further assurances or agreements and shall cooperate with Company or such insurer, as the case may be, to permit Company or such insurer to pursue such rights and remedies, if any, to the extent reasonably requested by Company. So long as no Event of Default has occurred and is continuing, if an Indemnitee receives any payment, in whole or in part, from any party other than Company or its insurers with respect to any Claim paid by Company or its insurers, it shall promptly pay over to Company the amount received (but not an amount in excess of the amount Company or any of its insurers has paid in respect of such Claim). Any amount referred to in the preceding sentence that is payable to Company shall not be paid to Company, or, if it has been previously paid directly to Company, shall not be retained by Company, if at the time of such payment an Event of Default has occurred and is continuing, but shall be paid to and held by Loan Trustee as security for the obligations of Company under the Operative Documents. If Company agrees, such amount payable shall be applied against Company's obligations thereunder when and as they become due and payable. At such time as such Event of Default is no longer continuing, such amount, to the extent not previously so applied against Company's obligations, shall be paid to Company. If any such amount has been so held by Loan Trustee as security for more than 90 days after any such Event of Default has occurred, during which period (i) Loan Trustee was not limited by operation of law or otherwise from exercising remedies under the Indenture and (ii) Loan Trustee did not exercise any remedy available to it under Section 4.02 of the Indenture, then any remaining amount shall be paid to Company. (h) No Guaranty. Nothing set forth in this Section 4.02 constitutes a guarantee by Company that the Aircraft at any time will have any particular value, useful life or residual value. (i) Payments; Interest. Any amount payable to any Indemnitee on account of a Claim shall be paid within 30 days after receipt by Company of a written demand therefor from such Indemnitee accompanied by a written statement describing in reasonable detail the Claims that are the subject of and basis for such indemnity and the computation of the amount payable. Any payments made pursuant to this Section 4.02 directly to an Indemnitee or to Company, as the case may be, shall be made in immediately available funds at such bank or to such account as is specified by the payee in written directions to the payor or, if no such directions are given, by check of the payor payable to the order of the payee and mailed to the payee by certified mail, return receipt requested, postage prepaid to its address referred to in Section 7.01. To the extent permitted by applicable law, interest at the Past Due Rate shall be paid, on demand, on any amount or indemnity not paid when due pursuant to this Section 4.02 until the same is paid. Such interest shall be paid in the same manner as the unpaid amount in respect of which such interest is due. (j) Tax deduction or credit. If, by reason of any Claim payment made to or for the account of an Indemnitee by Company pursuant to this Section 4.02, such Indemnitee subsequently realizes a tax deduction or credit (including foreign tax credit and any reduction in Taxes) not previously taken into account in computing such payment, such Indemnitee shall promptly pay to Company, but only if Company has made all payments then due and owing to such Indemnitee under the Operative Documents, an amount equal to the sum of (1) the actual reduction in Taxes realized by such Indemnitee which is attributable to such deduction or credit, and (2) the actual reduction in Taxes realized by such Indemnitee as a result of any payment made by such Indemnitee pursuant to this sentence. ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF STATE STREET Section 5.01 Representations, Warranties and Covenants of State Street. State Street, generally, and each of Loan Trustee, Subordination Agent and Pass Through Trustee as it relates to it, represents, warrants and covenants that: (a) State Street is a national banking association duly organized and validly existing in good standing under the laws of the United States, is eligible to be Loan Trustee under Section 8.01(a) of the Indenture, will promptly comply with Section 8.01(a) of the Indenture and has full power, authority and legal right to enter into and perform its obligations under each of the Operative Documents and the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party and, in its capacity as Loan Trustee and Pass Through Trustee, respectively, to authenticate the Equipment Notes and the Pass Through Certificates, respectively. State Street is qualified to act as Loan Trustee under Section 8.01(c) of the Indenture. (b) The execution, delivery and performance by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, each of the other Operative Documents and each of the Pass Through Documents to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, and the authentication of the Equipment Notes and the Pass Through Certificates, respectively, to be delivered on the Closing Date, have been duly authorized by all necessary action on the part of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee, as the case may be, and do not violate any law or regulation of the United States or of the state of the United States in which State Street is located and which governs the banking and trust powers of State Street or any order, writ, judgment or decree of any court, arbitrator or governmental authority applicable to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee or any of their assets, will not violate any provision of the articles of association or by-laws of State Street and will not violate any provision of, or constitute a default under, any mortgage, indenture, contract, agreement or undertaking to which any of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party or by which any of them or their respective properties may be bound or affected. (c) Neither the execution and delivery by State Street, individually or in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, of this Agreement, any other Operative Document or any Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, nor the consummation by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any of the transactions contemplated hereby or thereby, requires the authorization, consent or approval of, the giving of notice to, the filing or registration with, or the taking of any other action in respect of, any governmental authority or agency of the United States or the state of the United States where State Street is located and regulating the banking and trust powers of State Street. (d) This Agreement, each other Operative Document and each Pass Through Document to which State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee is a party have been duly executed and delivered by State Street, individually and in its capacity as Loan Trustee, Subordination Agent or Pass Through Trustee, as the case may be, and constitute the legal, valid and binding obligations of State Street, Loan Trustee, Subordination Agent and such Pass Through Trustee, as the case may be, enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. (e) It unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Loan Trustee Lien or Other Party Lien attributable to it, and it agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Lien; and it shall indemnify, protect, defend and hold harmless each Indemnitee and Company against Claims in any way resulting from or arising out of a breach by it of its obligations under this Section 5.01(e). (f) The Equipment Notes to be issued to Subordination Agent pursuant hereto are being acquired by it to be held under the Intercreditor Agreement. (g) Each of State Street, Loan Trustee, Subordination Agent and each Pass Through Trustee agrees that it will not impose any lifting charge, cable charge, remittance charge or any other charge or fee on any transfer by Company of funds to, through or by State Street, Loan Trustee, Subordination Agent or such Pass Through Trustee pursuant to this Agreement, any other Operative Document or any Pass Through Document, except as may be otherwise agreed to in writing by Company. (h) Each of State Street, Loan Trustee, Subordination Agent and any Pass Through Trustee agrees to be bound by the terms of Section 10.16 of the Indenture. (i) There are no Taxes payable by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee imposed by the State of Connecticut or any political subdivision or taxing authority thereof in connection with the execution, delivery or performance by State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee of any Operative Document or any Pass Through Document (other than franchise or other taxes based on or measured by any fees or compensation received by any such Person for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents), and there are no Taxes payable by any Pass Through Trustee imposed by the State of Connecticut or any political subdivision thereof in connection with the acquisition, possession or ownership by such Pass Through Trustee of any of the Equipment Notes (other than franchise or other taxes based on or measured by any fees or compensation received by such Pass Through Trustee for services rendered in connection with the transactions contemplated by the Operative Documents or the Pass Through Documents) and, assuming that the Pass Through Trusts will not be taxable for Federal income tax purposes as corporations, but, rather, will be characterized for such purposes as grantor trusts or partnerships, the Pass Through Trusts will not be subject to any Taxes imposed by the State of Connecticut or any political subdivision thereof. (j) Except with the consent of Company, which shall not be unreasonably withheld, State Street will act as Pass Through Trustee solely through its offices within the State of Connecticut, except for such services that may be performed for it by various agents, but not directly by it, in other states. (k) There are no pending or, to its knowledge, threatened actions or proceedings against State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee before any court or administrative agency which individually or in the aggregate, if determined adversely to it, would materially adversely affect the ability of State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee to perform its obligations under any Operative Document or any Pass Through Document. (l) The representations and warranties contained in Section 7.15 of each Pass Through Trust Agreement are true, complete and correct as of the Closing Date. ARTICLE 6 OTHER COVENANTS AND AGREEMENTS Section 6.01 Other Agreements. (a) Company agrees promptly to pay (without duplication of any other obligation Company may have to pay such amounts) (A) the initial and annual fees and (to the extent Loan Trustee is entitled to be reimbursed for its reasonable expenses) the reasonable expenses of Loan Trustee in connection with the transactions contemplated hereby and (B) the following expenses incurred by Loan Trustee, Subordination Agent and Pass Through Trustees in connection with the negotiation, preparation, execution and delivery of this Agreement, the other Operative Documents and the other documents or instruments referred to herein or therein: (i) the reasonable fees, expenses and disbursements of (x) Bingham Dana LLP, special counsel for Loan Trustee, Subordination Agent and Pass Through Trustees and (y) Daugherty, Fowler, Peregrin & Haught, A Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma, in each case to the extent actually incurred; and (ii) all reasonable expenses incurred in connection with printing and document production or reproduction expenses, and in connection with the filing of Uniform Commercial Code financing statements. (b) Loan Trustee, Noteholders, Subordination Agent and each Pass Through Trustee agree to execute and deliver, at Company's expense, all such documents as Company reasonably requests for the purpose of continuing the registration of the Aircraft at the FAA in Company's name. In addition, each of Loan Trustee, Subordination Agent, each Pass Through Trustee and any other Noteholder agrees, for the benefit of Company, to cooperate with Company in effecting any foreign registration of the Aircraft pursuant to Section 7.02(e) of the Indenture; provided that prior to any such change in the country of registry of the Aircraft the conditions set forth in Section 7.02(e) of the Indenture are met to the reasonable satisfaction of, or waived by, Loan Trustee. (c) Each of State Street, Loan Trustee, Subordination Agent, each Pass Through Trustee and any other Noteholder agrees that, unless an Event of Default shall have occurred and be continuing, it shall not take any action contrary to, or otherwise in any way interfere with or disturb (and then only in accordance with the Indenture), the quiet enjoyment of the use and possession of the Aircraft, the Airframe, any Engine or any Part by Company or any transferee of any interest in any thereof permitted under the Indenture. (d) Each Noteholder, including, without limitation, Subordination Agent and each Pass Through Trustee, unconditionally agrees with and for the benefit of the parties to this Agreement that it will not directly or indirectly create, incur, assume or suffer to exist any Noteholder Liens, and such Noteholder agrees that it will, at its own cost and expense, promptly take such action as may be necessary to discharge and satisfy in full any such Noteholder Lien; and each Noteholder hereby agrees to indemnify, protect, defend and hold harmless each Indemnitee and Company against Claims in any way resulting from or arising out of a breach by it of its obligations under this Section 6.01(d). (e) By its acceptance of its Equipment Notes, each Noteholder (i) unconditionally agrees for the benefit of Company and Loan Trustee to be bound by and to perform and comply with all of the terms of such Equipment Notes, the Indenture and this Agreement applicable to such Noteholder and (ii) agrees that it will not transfer any Equipment Note (or any part thereof) to any entity unless such entity makes (or is deemed to have made) a representation and warranty as of the date of transfer that either no part of the funds to be used by it for the purchase and holding of such Equipment Note (or any part thereof) constitutes assets of any "employee benefit plan" or that such purchase and holding will not result in a non-exempt prohibited transaction under Section 4975 of the Code and Section 406 of ERISA. (f) Each of Company, Loan Trustee, each Pass Through Trustee and Subordination Agent covenants that (i) until one year and one day after the Series G-1 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-1 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-1 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-1 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-1 Pass Through Trust, (ii) until one year and one day after the Series G-2 Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class G-2 Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class G-2 Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class G-2 Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class G-2 Pass Through Trust, (iii) until one year and one day after the Series C Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class C Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class C Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class C Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class C Pass Through Trust and (iv) until one year and one day after the Series D Equipment Notes have been paid in full, it shall not acquiesce, petition or otherwise invoke or cause or join in invoking or causing the Class D Pass Through Trust or any other Person to invoke the process of any governmental authority for the purpose of commencing or sustaining a case (whether voluntary or not) against the Class D Pass Through Trust under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Class D Pass Through Trust or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Class D Pass Through Trust. Section 6.02 Certain Covenants of Company. Company covenants and agrees with Loan Trustee as follows: (a) On and after the Closing, Company will cause to be done, executed, acknowledged and delivered such further acts, conveyances and assurances as Loan Trustee reasonably requests for accomplishing the purposes of this Agreement and the other Operative Documents; provided that any instrument or other document so executed by Company will not expand any obligations or limit any rights of Company in respect of the transactions contemplated by the Operative Documents. (b) Company will cause the Indenture (with the Indenture Supplement covering the Aircraft attached) to be promptly filed and recorded, or filed for recording, with the FAA to the extent permitted under the Transportation Code and the rules and regulations of the FAA thereunder. (c) Company, at its expense, will take, or cause to be taken, such action with respect to the recording, filing, re-recording and refiling of the Indenture and any financing statements or other instruments as are necessary to maintain, so long as the Indenture is in effect, the perfection of the security interests created by the Indenture or will furnish Loan Trustee timely notice of the necessity of such action, together with such instruments, in execution form, and such other information as may be required to enable Loan Trustee to take such action. In addition, Company will pay any and all recording, stamp and other similar taxes payable in the United States, and in any other jurisdiction where the Aircraft is registered, in connection with the execution, delivery, recording, filing, re-recording and refiling of the Indenture or any such financing statements or other instruments. Company will notify Loan Trustee of any change in its jurisdiction of organization (as such term is used in Article 9 of the Uniform Commercial Code as in effect in the State of Delaware) promptly after making such change or in any event within the period of time necessary under applicable law to prevent the lapse of perfection (absent refiling) of financing statements filed under the Operative Documents. (d) Company shall at all times maintain its corporate existence except as permitted by Subsection 6.02(e). (e) Company shall not consolidate with or merge into any other Person or convey, transfer or lease substantially all of its assets as an entirety to any Person, unless: (i) the successor or transferee entity shall, if and to the extent required under Section 1110 in order that Loan Trustee continues to be entitled to any benefits of Section 1110 with respect to the Aircraft, be a Citizen of the United States and a Certificated Air Carrier and shall execute and deliver to Loan Trustee an agreement containing the express assumption by such successor or transferee entity of the due and punctual performance and observance of each covenant and condition of the Operative Documents to which Company is a party to be performed or observed by Company; (ii) immediately after giving effect to such transaction, no Event of Default shall have occurred and be continuing; and (iii) Company shall deliver to Loan Trustee a certificate signed by a Responsible Officer of Company, and an opinion of counsel (which may be internal counsel to Company), each stating that such consolidation, merger, conveyance, transfer or lease and the assumption agreement mentioned in clause (i) above comply with this Subsection 6.02(e) and that all conditions precedent herein relating to such transaction have been complied with (except that such opinion need not cover the matters referred to in clause (ii) above and may rely, as to factual matters, on a certificate of an officer of Company) and, in the case of such opinion, that such assumption agreement has been duly authorized, executed and delivered by such successor Person and is enforceable against such successor Person in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors generally and by general principles of equity. Upon any consolidation or merger, or any conveyance, transfer or lease of substantially all of the assets of Company as an entirety in accordance with this Subsection 6.02(e), the successor Person formed by such consolidation or into which Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, Company under this Agreement and the other Operative Documents with the same effect as if such successor Person had been named as Company herein. (f) Company shall remain a Certificated Air Carrier for as long as and to the extent required under Section 1110 in order that Loan Trustee shall be entitled to any of the benefits of Section 1110 with respect to the Aircraft. ARTICLE 7 MISCELLANEOUS Section 7.01 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices required or permitted under the terms and provisions of this Agreement shall be in English and in writing, and any such notice may be given by registered or certified United States mail, courier service or facsimile or any other customary means of communication, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: if to Company, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 733-1657 if to State Street, Loan Trustee, Subordination Agent or any Pass Through Trustee, addressed to: State Street Bank And Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Facsimile: (860) 244-1881 or if to any subsequent Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 of the Indenture. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 7.01. Section 7.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements. Except as otherwise provided herein, the representations, warranties, indemnities, covenants and agreements of Company, State Street, Loan Trustee, Subordination Agent, each Pass Through Trustee and Noteholders herein, and each of their obligations hereunder, shall survive the making of the loans and the expiration or termination (to the extent arising out of acts or events occurring prior to such expiration) of any Operative Documents. Section 7.03 Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 7.04 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 hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 7.05 No Oral Modifications or Continuing Waivers; Consents. Subject to Section 9.03 of the Indenture, 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 against which the enforcement of the change, waiver, discharge or termination is sought. No such change, waiver, discharge or termination shall be effective unless a signed copy thereof is delivered to Loan Trustee. Each Pass Through Trustee and, by its acceptance of an Equipment Note, each subsequent Noteholder covenants and agrees that it shall not unreasonably withhold its consent to any consent of Loan Trustee requested by Company under the Indenture. Section 7.06 Effect of Headings and Table of Contents. The headings of the various Articles and Sections herein and in the Table of Contents are for convenience of reference only and do not define or limit any of the terms or provisions hereof. Section 7.07 Successors and Assigns. All covenants, agreements, representations and warranties in this Agreement by Company, by State Street, individually or as Loan Trustee, Subordination Agent or Pass Through Trustee, or by any Noteholder, shall bind and inure to the benefit of and be enforceable by Company, and subject to the terms of Section 6.02(e), its successors and permitted assigns, each Pass Through Trustee and any successor or other trustee under the Pass Through Trust Agreement to which it is a party, Subordination Agent and its successor under the Intercreditor Agreement and Loan Trustee and its successor under the Indenture, whether so expressed or not. Section 7.08 Benefits of Agreement. Nothing in this Agreement, express or implied, gives to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy or claim under this Agreement, except as expressly provided herein. Company agrees and acknowledges that Liquidity Provider and Policy Provider shall be third party beneficiaries of the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and the indemnities contained in Section 4.02 and may rely on the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and such indemnities to the same extent as if the covenants and agreements of Company with respect to the Mandatory Documents Terms and the Mandatory Economic Terms and such indemnities were made to Liquidity Provider and Policy Provider directly. Section 7.09 Counterparts. This Agreement may be executed in any number of counterparts. Each of the parties hereto shall not be required to execute the same counterpart. Each counterpart of this Agreement including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Agreement, but all of such counterparts shall together constitute one instrument. Section 7.10 Submission to Jurisdiction. Each of the parties hereto, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Documents hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. IN WITNESS WHEREOF, the parties hereto have caused this Participation Agreement to be duly executed by their respective officers thereunto duly authorized as of the date first above written. DELTA AIR LINES, INC. By: ______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Pass Through Trustee under each of the Pass Through Trust Agreements By: ______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Subordination Agent By: ______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By: ______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, in its individual capacity as set forth herein By: ______________________________________________ Name: Title: SCHEDULE I to PARTICIPATION AGREEMENT EQUIPMENT NOTES, PURCHASERS AND ORIGINAL PRINCIPAL AMOUNTS
Original Description of Principal Purchaser Equipment Notes Maturity Interest Rate Amount - ------------------------ ----------------- --------------- ------------- -------------- Delta Air Lines Pass Series 2002-1G-1 Through Trust Equipment Note 2002-1G-1 EN-1G1-001 January 2, 2012 6.718% $16,536,158.27 Delta Air Lines Pass Series 2002-1G-2 Through Trust Equipment Note 2002-1G-2 EN-1G2-001 July 2, 2012 6.417% $29,011,605.76 Series 2002-1C Delta Air Lines Pass Equipment Note Through Trust 2002-1C EN-1C-001 January 2, 2010 7.779% $6,782,455.39 Series 2002-1D Delta Air Lines Pass Equipment Note Through Trust 2002-1D EN-1D-001 July 2, 2007 8.270% $7,324,324.89
SCHEDULE II to PARTICIPATION AGREEMENT TRUST SUPPLEMENTS Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-1. Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1G-2. Trust Supplement No. 2002-1C, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1C. Trust Supplement No. 2002-1D, dated as of April 30, 2002, between Company and Pass Through Trustee in respect of Delta Air Lines Pass Through Trust 2002-1D. EXHIBIT A-1 to PARTICIPATION AGREEMENT FORM OF OPINION OF COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT A-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT A-3 to PARTICIPATION AGREEMENT FORM OF ss. 1110 OPINION OF SPECIAL COUNSEL FOR COMPANY [Intentionally Omitted] EXHIBIT B to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LOAN TRUSTEE, SUBORDINATION AGENT AND STATE STREET [Intentionally Omitted] EXHIBIT C to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL FAA COUNSEL [Intentionally Omitted] EXHIBIT D-1 to PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR LIQUIDITY PROVIDER [Intentionally Omitted] EXHIBIT D-2 to PARTICIPATION AGREEMENT FORM OF OPINION OF GERMAN IN-HOUSE COUNSEL FOR LIQUIDITY PROVIDER [Intentionally Omitted] EXHIBIT E to PARTICIPATION AGREEMENT FORM OF MANUFACTURER'S CONSENT [Intentionally Omitted] EXHIBIT F TO PARTICIPATION AGREEMENT FORM OF OPINION SPECIAL COUNSEL FOR PASS THROUGH TRUSTEES [Intentionally Omitted] EXHIBIT G TO PARTICIPATION AGREEMENT FORM OF OPINION OF SPECIAL COUNSEL FOR POLICY PROVIDER [Intentionally Omitted] EX-4.(E)(5) 15 de763576-ex4e5.txt INDENTURE AND SECURITY AGREEMENT EXHIBIT 4(e)(5) ================================================================================ INDENTURE AND SECURITY AGREEMENT (N833MH) Dated as of April 30, 2002 between DELTA AIR LINES, INC., and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee ---------------- One Boeing 767-432ER Aircraft U.S. Registration No. N833MH ================================================================================ TABLE OF CONTENTS Page ARTICLE I DEFINITIONS Section 1.01 Definitions.................................................. Section 1.02 Other Definitional Provisions................................ ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes...................................... Section 2.02 Issuance and Terms of Equipment Notes........................ Section 2.03 Method of Payment............................................ Section 2.04 Withholding Taxes............................................ Section 2.05 Application of Payments...................................... Section 2.06 Termination of Interest in Collateral........................ Section 2.07 Registration, Transfer and Exchange of Equipment Notes....... Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes......... Section 2.09 Payment of Expenses on Transfer; Cancellation................ Section 2.10 Mandatory Redemption of Equipment Notes...................... Section 2.11 Voluntary Redemption of Equipment Notes...................... Section 2.12 Redemptions; Notice of Redemptions; Repurchases.............. Section 2.13 Subordination................................................ Section 2.14 Certain Payments............................................. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee.............................................. Section 2.16 Directions by Subordination Agent............................ ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE COLLATERAL Section 3.01 Basic Distributions.......................................... Section 3.02 Event of Loss; Optional Redemption........................... Section 3.03 Payments after Event of Default.............................. Section 3.04 Certain Payments............................................. Section 3.05 Payments to Company.......................................... ARTICLE IV EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Events of Default............................................ Section 4.02 Remedies..................................................... Section 4.03 Remedies Cumulative.......................................... Section 4.04 Discontinuance of Proceedings................................ Section 4.05 Waiver of Past Defaults...................................... Section 4.06 Noteholders May Not Bring Suit Except Under Certain Conditions................................................ ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Event of Default................................... Section 5.02 Action upon Instructions; Certain Rights and Limitations............................................... Section 5.03 Indemnification.............................................. Section 5.04 No Duties Except as Specified in Indenture or Instructions.............................................. Section 5.05 No Action Except under Indenture or Instructions............. Section 5.06 Investment of Amounts Held by Loan Trustee................... ARTICLE VI LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties.............................. Section 6.02 Absence of Certain Duties.................................... Section 6.03 No Representations or Warranties as to the Documents......... Section 6.04 No Segregation of Monies; No Interest........................ Section 6.05 Reliance; Agents; Advice of Counsel.......................... Section 6.06 Instructions from Noteholders................................ ARTICLE VII OPERATING COVENANTS OF COMPANY Section 7.01 Liens........................................................ Section 7.02 Possession, Operation and Use, Maintenance and Registration.............................................. Section 7.03 Inspection; Financial Information............................ Section 7.04 Replacement and Pooling of Parts; Alterations, Modifications and Additions; Substitution of Engines...... Section 7.05 Loss, Destruction or Requisition............................. Section 7.06 Insurance.................................................... ARTICLE VIII SUCCESSOR AND ADDITIONAL TRUSTEES Section 8.01 Resignation or Removal; Appointment of Successor............. Section 8.02 Appointment of Additional and Separate Trustees.............. ARTICLE IX AMENDMENTS AND WAIVERS Section 9.01 Amendments to this Indenture without Consent of Holders...... Section 9.02 Amendments to this Indenture with Consent of Holders......... Section 9.03 Amendments, Waivers, Etc. of the Participation Agreement..... Section 9.04 Revocation and Effect of Consents............................ Section 9.05 Notation on or Exchange of Equipment Notes................... Section 9.06 Trustee Protected............................................ ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture..................................... Section 10.02 No Legal Title to Collateral in Noteholders.................. Section 10.03 Sale of Aircraft by Loan Trustee is Binding.................. Section 10.04 Indenture for Benefit of Company, Loan Trustee and Noteholders............................................... Section 10.05 Notices...................................................... Section 10.06 Severability................................................. Section 10.07 No Oral Modification or Continuing Waivers................... Section 10.08 Successors and Assigns....................................... Section 10.09 Headings..................................................... Section 10.10 Normal Commercial Relations.................................. Section 10.11 Voting by Noteholders........................................ Section 10.12 Section 1110................................................. Section 10.13 Company's Performance and Rights............................. Section 10.14 Counterparts................................................. Section 10.15 Governing Law................................................ Section 10.16 Confidential Information..................................... Section 10.17 Submission to Jurisdiction................................... Exhibit A - Form of Indenture Supplement Exhibit B - List of Permitted Countries Exhibit C - Aircraft Type Equipment Value for Section 7.06(b) Schedule I - Description of Equipment Notes Schedule II - Pass Through Trust Agreement and Pass Through Trust Supplements Annex A - Definitions INDENTURE AND SECURITY AGREEMENT (N833MH) This INDENTURE AND SECURITY AGREEMENT (N833MH), dated as of April 30, 2002, is made by and between DELTA AIR LINES, INC., a Delaware corporation (together with its successors and permitted assigns, "Company"), and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity, except as expressly stated herein, but solely as Loan Trustee hereunder (together with its permitted successors hereunder, "Loan Trustee"). W I T N E S S E T H: WHEREAS, the parties desire by this Indenture (such term and other capitalized terms used herein without definition being defined as provided in Article I), among other things, to provide for (i) the issuance by Company of the Equipment Notes and (ii) the assignment, mortgage and pledge by Company to Loan Trustee, as part of the Collateral hereunder, among other things, of all of Company's estate, right, title and interest in and to the Aircraft, as security for, among other things, Company's obligations to Loan Trustee, for the ratable benefit and security of Noteholders, subject to Section 2.13 and Article III; WHEREAS, all things have been done to make the Equipment Notes, when executed by Company and authenticated and delivered by Loan Trustee hereunder, the valid, binding and enforceable obligations of Company; and WHEREAS, all things necessary to make this Indenture a legal, valid and binding obligation of Company for the uses and purposes herein set forth, in accordance with its terms, have been done and performed and have occurred; GRANTING CLAUSE NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and all other amounts payable by Company under the Operative Documents and the performance and observance by Company of all the agreements and covenants to be performed or observed by Company for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Company at or before the Closing Date, the receipt of which is hereby acknowledged, Company does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Company in, to and under, all and singular, the following described properties, rights, interests and privileges whether now or hereafter acquired (hereinafter sometimes referred to as the "Collateral"): (1) the Aircraft, including the Airframe and the Engines, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided herein, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto (such Airframe and Engines as more particularly described in the Indenture Supplement executed and delivered with respect to the Aircraft on the Closing Date or with respect to any substitutions or replacements therefor) and together with all logs, manuals maintained on the Aircraft, modification and maintenance records at any time required to be maintained with respect to the Aircraft, in accordance with the rules and regulations of the FAA if the Aircraft is registered under the laws of the United States or the rules and regulations of the government of the country of registry if the Aircraft is registered under the laws of a jurisdiction other than the United States; (2) the Warranty Rights, together with all rights, powers, privileges, options and other benefits of Company under the same; (3) all requisition proceeds with respect to the Aircraft or any Part thereof, and all insurance proceeds with respect to the Aircraft or any Part thereof, but excluding all proceeds of, and rights under, any insurance maintained by Company and in excess of that required under Section 7.06(b); (4) all moneys and securities now or hereafter paid or deposited or required to be paid or deposited to or with Loan Trustee by or for the account of Company pursuant to any term of any Operative Document and held or required to be held by Loan Trustee hereunder or thereunder; and (5) all proceeds of the foregoing; PROVIDED, HOWEVER, that notwithstanding any of the foregoing provisions, so long as no Event of Default shall have occurred and be continuing, Company shall have the right, to the exclusion of Loan Trustee, (i) to quiet enjoyment of the Aircraft, the Airframe, the Parts and the Engines, and to possess, use, retain and control the Aircraft, the Airframe, the Parts and the Engines and all revenues, income and profits derived therefrom and (ii) with respect to the Warranty Rights, to exercise in Company's name all rights and powers of the Buyer (as defined in the Purchase Agreement) under the Warranty Rights and to retain any recovery or benefit resulting from the enforcement of any warranty or indemnity or other obligation under the Warranty Rights; provided, further, that notwithstanding the occurrence and continuation of an Event of Default, Loan Trustee shall not enter into any amendment or modification of the Purchase Agreement that would alter the rights, benefits or obligations of Company thereunder; TO HAVE AND TO HOLD all and singular the aforesaid property unto Loan Trustee, and its successors and permitted assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in this Indenture, including Section 2.13 and Article III, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and in all cases and as to all property specified in paragraphs (1) through (5) inclusive above, subject to the terms and provisions set forth in this Indenture. It is expressly agreed that notwithstanding anything herein to the contrary, Company shall remain liable under the Purchase Agreement to perform all of its obligations thereunder, and, except to the extent expressly provided in any Operative Document, none of Loan Trustee, any Noteholders or any Indenture Indemnitee shall be required or obligated in any manner to perform or fulfill any obligations of Company under or pursuant to any Operative Document, or to make any inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or take any action to collect or enforce the payment of any amount that may have been assigned to it or to which it may be entitled at any time or times. Notwithstanding anything herein to the contrary (but without in any way releasing Company from any of its duties or obligations under the Purchase Agreement), Loan Trustee, Noteholders and Indenture Indemnitees confirm for the benefit of Manufacturer that in exercising any rights under the Warranty Rights, or in making any claim with respect to the Aircraft or other goods and services delivered or to be delivered pursuant to the Purchase Agreement, the terms and conditions of the Purchase Agreement relating to the Warranty Rights, including, without limitation, the warranty disclaimer provisions for the benefit of Manufacturer, shall apply to and be binding upon Loan Trustee, Noteholders and Indenture Indemnitees to the same extent as Company. Company hereby directs Manufacturer, so long as an Event of Default shall have occurred and be continuing, to pay all amounts, if any, payable to Company pursuant to the Warranty Rights directly to Loan Trustee to be held and applied as provided herein. Nothing contained herein shall subject Manufacturer to any liability to which it would not otherwise be subject under the Purchase Agreement or modify in any respect the contract rights of Manufacturer thereunder except as provided in the Manufacturer's Consent. Company does hereby constitute Loan Trustee the true and lawful attorney of Company (which appointment is coupled with an interest) with full power (in the name of Company or otherwise) to ask, require, demand and receive any and all monies and claims for monies (in each case including insurance and requisition proceeds) due and to become due to Company under or arising out of the Purchase Agreement (to the extent assigned hereby), and all other property which now or hereafter constitutes part of the Collateral, to endorse any checks or other instruments or orders in connection therewith and to file any claims or to take any action or to institute any proceedings which Loan Trustee may deem to be necessary or advisable in the premises; provided that Loan Trustee shall not exercise any such rights except during the continuance of an Event of Default. Company agrees that promptly upon receipt thereof, to the extent required by the Operative Documents, it will transfer to Loan Trustee any and all monies from time to time received by Company constituting part of the Collateral, for distribution by Loan Trustee pursuant to this Indenture. Company does hereby warrant and represent that it has not sold, assigned or pledged, and hereby covenants and agrees that it will not sell, assign or pledge, so long as this Indenture shall remain in effect and the Lien hereof shall not have been released pursuant to the provisions hereof, any of its estate, right, title or interest hereby assigned, to any Person other than Loan Trustee, except as otherwise provided in or permitted by any Operative Document. Company agrees that at any time and from time to time, upon the written request of Loan Trustee, Company shall promptly and duly execute and deliver or cause to be duly executed and delivered any and all such further instruments and documents as Loan Trustee may reasonably deem necessary to perfect, preserve or protect the mortgage, security interests and assignments created or intended to be created hereby or to obtain for Loan Trustee the full benefit of the assignment hereunder and of the rights and powers herein granted, provided that any instrument or other document so executed by Company will not expand any obligations or limit any rights of Company in respect of the transactions contemplated by the Operative Documents. IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. For all purposes of this Indenture, unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings set forth or incorporated by reference in Annex A. Section 1.02 Other Definitional Provisions. (a) The definitions stated herein and in Annex A apply equally to both the singular and the plural forms of the terms defined. (b) All references in this Indenture to designated "Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and other subdivisions are to the designated Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision of this Indenture, unless otherwise specifically stated. (c) The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, Subsection, Schedule, Exhibit, Annex or other subdivision. (d) Unless the context otherwise requires, whenever the words "including", "include" or "includes" are used herein, they shall be deemed to be followed by the phrase "without limitation". (e) All references in this Indenture to a "government" are to such government and any instrumentality or agency thereof. ARTICLE II THE EQUIPMENT NOTES Section 2.01 Form of Equipment Notes. The Equipment Notes shall be substantially in the form set forth below: THIS EQUIPMENT NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. ACCORDINGLY, THIS EQUIPMENT NOTE MAY NOT BE OFFERED FOR SALE OR SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND SUCH APPLICABLE STATE OR OTHER LAWS OR EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. DELTA AIR LINES, INC. SERIES 2002-1 [___] EQUIPMENT NOTE DUE [___] ISSUED IN CONNECTION WITH THE BOEING 767-432ER AIRCRAFT BEARING UNITED STATES REGISTRATION NUMBER N833MH No.____ Date: [______,__] $________________ INTEREST RATE MATURITY DATE [____] [___________,_____] DELTA AIR LINES, INC. (together with its successors and permitted assigns, "Company") hereby promises to pay to ___________, or the registered assignee thereof, the principal amount of ________________ Dollars ($_________) [on __________]1 [in installments on the Payment Dates set forth in Schedule I hereto, each such installment to be in an amount computed by multiplying the original principal amount of this Equipment Note by the percentage set forth in Schedule I hereto opposite the Payment Date on which such installment is due,]2 and to pay interest in arrears on each Payment Date at the Debt Rate on the principal amount remaining unpaid from time to time (calculated on the basis of a year of 360 days comprised of twelve 30-day months) from the date hereof until paid in full. [Notwithstanding the foregoing, the final payment made on this Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, this Equipment Note.]2 Notwithstanding anything to the contrary contained herein, if any date on which a payment under this Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. - ----------------- 1 To be inserted in non-installment Equipment Notes. 2 To be inserted in installment Equipment Notes. For purposes hereof, the term "Indenture" means the Indenture and Security Agreement (N833MH), dated as of April 30, 2002, between Company and State Street Bank and Trust Company of Connecticut, National Association, as Loan Trustee ("Loan Trustee"), as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms. All capitalized terms used in this Equipment Note and not defined herein, unless the context otherwise requires, shall have the respective meanings set forth or incorporated by reference, and shall be construed and interpreted in the manner described, in the Indenture. This Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable hereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue if not paid in the manner provided herein or in the Indenture when due (whether at stated maturity, by acceleration or otherwise). There shall be maintained an Equipment Note Register for the purpose of registering transfers and exchanges of Equipment Notes at the Corporate Trust Office of Loan Trustee, or at the office of any successor trustee, in the manner provided in Section 2.07 of the Indenture. The principal amount and interest and other amounts due hereunder shall be payable in Dollars in immediately available funds at the Corporate Trust Office of Loan Trustee, or as otherwise provided in the Indenture. Company shall not have any responsibility for the distribution of any such payment to Noteholder of this Equipment Note. Each such payment shall be made on the date such payment is due and without any presentment or surrender of this Equipment Note, except that in the case of any final payment with respect to this Equipment Note, the Equipment Note shall be surrendered to Loan Trustee for cancellation. The holder hereof, by its acceptance of this Equipment Note, agrees that, except as provided in the Indenture, including the subordination provisions referred to below, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest received by it hereunder shall be applied: first, to the payment of accrued interest on this Equipment Note (as well as any interest on any overdue principal amount, and, to the extent permitted by law, any overdue Make-Whole Amount, if any, any overdue interest and other overdue amounts hereunder) to the date of such payment; second, to the payment of Make-Whole Amount, if any, and third, to the payment of the principal amount of this Equipment Note (or portion hereof) then due. This Equipment Note is one of the Equipment Notes referred to in the Indenture which have been or are to be issued by Company pursuant to the terms of the Indenture. The Collateral is held by Loan Trustee as security, in part, for the Equipment Notes. The provisions of this Equipment Note are subject to the Indenture and the Participation Agreement. Reference is hereby made to the Indenture and the Participation Agreement for a complete statement of the rights and obligations of the holder of, and the nature and extent of the security for, this Equipment Note and the rights and obligations of the holders of, and the nature and extent of the security for, any other Equipment Notes executed and delivered under the Indenture, to all of which terms and conditions in the Indenture and the Participation Agreement each holder hereof agrees by its acceptance of this Equipment Note. As provided in the Indenture and subject to certain limitations therein set forth, this Equipment Note is exchangeable for a like aggregate principal amount of Equipment Notes of the same Series of different authorized denominations, as requested by the holder surrendering the same. Prior to the due presentment for registration of transfer of this Equipment Note, Company and Loan Trustee shall deem and treat the Person in whose name this Equipment Note is registered on the Equipment Note Register as the absolute owner and holder hereof for the purpose of receiving all amounts payable with respect to this Equipment Note and for all purposes, and neither Company nor Loan Trustee shall be affected by notice to the contrary. This Equipment Note is subject to redemption as provided in Sections 2.10 and 2.11 of the Indenture but not otherwise. The indebtedness evidenced by this Equipment Note [shall rank in right of payment equally with all Series G-2 Equipment Notes and all other Series G-1 Equipment Notes.]3 [shall rank in right of payment equally with all Series G-1 Equipment Notes and all other Series G-2 Equipment Notes.]4 [is, to the extent and in the manner provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations (as defined in the Indenture) in respect of [Series G-1 Equipment Notes and Series G-2 Equipment Notes]5 [Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes]6, and this Equipment Note is issued subject to such provisions.]7 Noteholder of this Equipment Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs Loan Trustee on such Noteholder's behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in the Indenture and (c) appoints Loan Trustee such Noteholder's attorney-in-fact for such purpose. [Without limiting the foregoing, the]8 [The]9 Noteholder of this Equipment Note, by accepting the same, agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligation in respect of this Equipment Note that it is not entitled to receive under Section 2.13 or Article III of the Indenture, it shall hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III of the Indenture. Unless the certificate of authentication hereon has been executed by or on behalf of Loan Trustee by manual signature, this Equipment Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. - ----------------- 3 To be inserted in the case of a Series G-1 Equipment Note. 4 To be inserted in the case of a Series G-2 Equipment Note. 5 To be inserted in the case of a Series C Equipment Note. 6 To be inserted in the case of a Series D Equipment Note. 7 To be inserted in the case of a Series C Equipment Note or a Series D Equipment Note. 8 To be inserted in the case of a Series C Equipment Note or a Series D Equipment Note. 9 To be inserted in the case of a Series G-1 Equipment Note or a Series G-2 Equipment Note. THIS EQUIPMENT NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. IN WITNESS WHEREOF, Company has caused this Equipment Note to be executed in its corporate name by its officer thereunto duly authorized on the date hereof. DELTA AIR LINES, INC. By: ______________________________________________ Name: Title: LOAN TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Equipment Notes referred to in the within-mentioned Indenture. STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee By: ______________________________________________ Name: Title: SCHEDULE I(10) EQUIPMENT NOTE AMORTIZATION Payment Date Percentage of Original Principal Amount to be Paid [SEE "EQUIPMENT NOTES AMORTIZATION" ON SCHEDULE I TO INDENTURE WHICH IS TO BE INSERTED UPON ISSUANCE] * * * Section 2.02 Issuance and Terms of Equipment Notes. The Equipment Notes shall be dated the date of issuance thereof, shall be issued in (a) four separate series consisting of Series G-1 Equipment Notes, Series G-2 Equipment Notes, Series C Equipment Notes and Series D Equipment Notes and (b) the maturities and principal amounts and shall bear interest at the applicable Debt Rates specified in Schedule I. On the Closing Date, each Series G-1 Equipment Note, Series G-2 Equipment Note, Series C Equipment Note and Series D Equipment Note shall be issued to Subordination Agent on behalf of each of Pass Through Trustees for the Pass Through Trusts created under the Pass Through Trust Agreements referred to in Schedule II. The Equipment Notes shall be issued in registered form only. The Equipment Notes shall be issued in denominations of $1,000 and integral multiples thereof, except that one Equipment Note of each Series may be in an amount that is not an integral multiple of $1,000. Each Equipment Note shall bear interest at the Debt Rate (calculated on the basis of a year of 360 days comprised of twelve 30-day months), payable in arrears on each Payment Date on the unpaid principal amount thereof from time to time outstanding until such principal amount is paid in full, as further provided in the form of Equipment Note set forth in Section 2.01. The principal amount of each Series G-1 Equipment Note and each Series C Equipment Note shall be payable in installments on the Payment Dates and in the installments equal to the corresponding percentage of the principal amount set forth in Schedule I hereto applicable to such Series, which shall be attached as Schedule I to such Equipment Note. The principal amount of each Series G-2 Equipment Note shall be due in a single payment on July 2, 2012. The principal amount of each Series D Equipment Note shall be due in a single payment on July 2, 2007. Notwithstanding the foregoing, the final payment made under each Series G-1 Equipment Note and each Series C Equipment Note shall be in an amount sufficient to discharge in full the unpaid principal amount and all accrued and unpaid interest on, and any other amounts due under, such Equipment Note. Each Equipment Note shall bear interest, payable on demand, at the Past Due Rate (and not at the Debt Rate) (calculated on the basis of a year of 360 days comprised of twelve 30-day months) on any principal amount and (to the extent permitted by applicable law) Make-Whole Amount, if any, interest and any other amounts payable thereunder not paid when due for any period during which the same is overdue, in each case for the period the same is overdue. Amounts shall be overdue under an Equipment Note if not paid in the manner provided therein or in this Indenture when due (whether at stated maturity, by acceleration or otherwise). Notwithstanding anything to the contrary contained herein, if any date on which a payment hereunder or under any Equipment Note becomes due and payable is not a Business Day, then such payment shall not be made on such scheduled date but shall be made on the next succeeding Business Day with the same force and effect as if made on such scheduled date, and if such payment is made on such next succeeding Business Day, no interest shall accrue on the amount of such payment from and after such scheduled date. - ----------------- 10 To be inserted on installment Equipment Notes. The Equipment Notes shall be executed on behalf of Company by the manual or facsimile signature of one of its authorized officers. Equipment Notes bearing the signatures of individuals who were at the time of execution the proper officers of Company shall bind Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Equipment Notes or did not hold such offices at the respective dates of such Equipment Notes. No Equipment Note shall be secured by or entitled to any benefit under this Indenture or be valid or obligatory for any purposes unless there appears on such Equipment Note a certificate of authentication in the form provided herein executed by Loan Trustee by the manual signature of one of its authorized officers, and such certificate upon any Equipment Notes shall be conclusive evidence, and the only evidence, that such Equipment Note has been duly authenticated and delivered hereunder. Section 2.03 Method of Payment. The principal amount of, interest on, Make-Whole Amount, if any, and, except to the extent expressly provided herein, all other amounts due to any Noteholder under each Equipment Note or otherwise payable hereunder shall be payable by Company in Dollars by wire transfer of immediately available funds not later than 10:00 a.m. (New York City time) on the due date of payment to Loan Trustee at the Corporate Trust Office for distribution among Noteholders in the manner provided herein. Company shall not have any responsibility for the distribution of such payment to any Noteholder. Notwithstanding the foregoing or any provision in any Equipment Note to the contrary, Loan Trustee will use reasonable efforts to pay or cause to be paid, if so directed in writing by any Noteholder (with a copy to Company), all amounts paid by Company hereunder and under such Noteholder's Equipment Note or Equipment Notes to such Noteholder or a nominee therefor (including all amounts distributed pursuant to Article III) by transferring, or causing to be transferred, by wire transfer of immediately available funds in Dollars, prior to 12:00 noon (New York City time) on the due date of payment, to an account maintained by such Noteholder with a bank located in the continental United States the amount to be distributed to such Noteholder, for credit to the account of such Noteholder maintained at such bank; provided that, in the event the Equipment Notes are not held by Subordination Agent on behalf of Pass Through Trustees, Loan Trustee may at its option pay such amounts by check mailed to Noteholder's address as it appears on the Equipment Note Register. If, after its receipt of funds at the place and prior to the time specified above in the immediately preceding sentence, Loan Trustee fails (other than as a result of a failure of Noteholder to provide it with wire transfer instructions) to make any such payment required to be paid by wire transfer as provided in the immediately preceding sentence on the Business Day it receives such funds, Loan Trustee, in its individual capacity and not as trustee, agrees to compensate such Noteholders for loss of use of funds at the Federal Funds Rate until such payment is made and Loan Trustee shall be entitled to any interest earned on such funds until such payment is made. Any payment made hereunder shall be made without any presentment or surrender of any Equipment Note, except that, in the case of the final payment in respect of any Equipment Note, such Equipment Note shall be surrendered to Loan Trustee for cancellation. Notwithstanding any other provision of this Indenture to the contrary, Loan Trustee shall not be required to make, or cause to be made, wire transfers as aforesaid prior to the first Business Day on which it is practicable for Loan Trustee to do so in view of the time of day when the funds to be so transferred were received by it if such funds were received after 1:00 p.m. (New York City time) at the place of payment. Section 2.04 Withholding Taxes. Loan Trustee shall exclude and withhold at the appropriate rate from each payment of principal amount of, interest on, Make-Whole Amount, if any, and other amounts due hereunder or under each Equipment Note (which exclusion and withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) any and all withholding taxes applicable thereto as required by law. Loan Trustee agrees to act as such withholding agent and, in connection therewith, whenever any present or future taxes or similar charges are required to be withheld with respect to any amounts payable hereunder or in respect of the Equipment Notes, to withhold such amounts (which withholding shall constitute payment of such amounts payable hereunder or in respect of such Equipment Notes, as applicable) and timely pay the same to the appropriate authority in the name of and on behalf of Noteholders, that it will file any necessary withholding tax returns or statements when due, and that as promptly as possible after the payment thereof it will deliver to each Noteholder (with a copy to Company) appropriate documentation showing the payment thereof, together with such additional documentary evidence as any such Noteholder may reasonably request from time to time. Loan Trustee agrees to file any other information reports it is required to file under United States law. Section 2.05 Application of Payments. Subject always to Section 2.13 and except as otherwise provided in Article III, in the case of each Equipment Note, each payment of an installment of principal amount, Make-Whole Amount, if any, and interest paid thereon shall be applied: first, to the payment of accrued interest on such Equipment Note (as well as any interest on any overdue principal amount and (to the extent permitted by law) any overdue Make-Whole Amount, if any, any overdue interest and any other overdue amounts thereunder) to the date of such payment; and second, to the payment of Make-Whole Amount, if any; and third, to the payment of principal amount of such Equipment Note (or portion thereof) then due thereunder. Section 2.06 Termination of Interest in Collateral. No Noteholder or Indenture Indemnitee shall, as such, have any further interest in, or other right with respect to, the Collateral when and if the principal amount of, Make-Whole Amount, if any, and interest (including interest on any overdue amounts) on and all other amounts due under all Equipment Notes held by such Noteholder and all other sums then payable to such Noteholder or Indenture Indemnitee, as the case may be, hereunder and under the Participation Agreement by Company (collectively, "Secured Obligations") have been paid in full. Section 2.07 Registration, Transfer and Exchange of Equipment Notes. Loan Trustee shall keep a register or registers (the "Equipment Note Register") in which Loan Trustee shall provide for the registration of Equipment Notes and the registration of transfers of Equipment Notes. No such transfer shall be given effect unless and until registration hereunder shall have occurred. The Equipment Note Register shall be kept at the Corporate Trust Office of Loan Trustee. Loan Trustee is hereby appointed "Equipment Note Registrar" for the purpose of registering Equipment Notes and transfers of Equipment Notes. A holder of any Equipment Note intending to exchange or transfer such Equipment Note shall surrender such Equipment Note to Loan Trustee at the Corporate Trust Office, together with a written request from the registered holder thereof for the issuance of a new Equipment Note of the same Series, specifying, in the case of a surrender for transfer, the name and address of the new holder or holders. Upon surrender for registration of transfer of any Equipment Note and subject to satisfaction of Section 2.09, Company shall execute, and Loan Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Equipment Notes of an equal aggregate principal amount and of the same Series. At the option of Noteholder, Equipment Notes may be exchanged for other Equipment Notes of the same Series of any authorized denominations of an equal aggregate principal amount, upon surrender of the Equipment Notes to be exchanged to Loan Trustee at the Corporate Trust Office. Whenever any Equipment Notes are so surrendered for exchange, Company shall execute, and Loan Trustee shall authenticate and deliver, the Equipment Notes which Noteholder making the exchange is entitled to receive. All Equipment Notes issued upon any registration of transfer or exchange of Equipment Notes (whether under this Section 2.07 or under Section 2.08 or otherwise under this Indenture) shall be the valid obligations of Company evidencing the same respective obligations, and entitled to the same security and benefits under this Indenture, as the Equipment Notes surrendered upon such registration of transfer or exchange. Every Equipment Note presented or surrendered for registration of transfer shall be duly endorsed or be accompanied by a written instrument of transfer in form satisfactory to Loan Trustee, duly executed by Noteholder or such Noteholder's attorney duly authorized in writing, and Loan Trustee shall require evidence satisfactory to it as to the compliance of any such transfer with the Securities Act of 1933, as amended, and the securities laws of any applicable state or jurisdiction. Loan Trustee shall make a notation on each new Equipment Note of the amount of all payments of principal amount previously made on the old Equipment Note or Equipment Notes with respect to which such new Equipment Note is issued and the date to which interest on such old Equipment Note or Equipment Notes has been paid. Principal, interest and all other amounts shall be deemed to have been paid on such new Equipment Note to the date on which such amounts have been paid on such old Equipment Note. Company shall not be required to exchange any surrendered Equipment Notes as provided above (a) during the ten-day period preceding the due date of any payment on such Equipment Note or (b) that has been called for redemption. Company and Loan Trustee shall in all cases deem and treat the Person in whose name any Equipment Note has been issued and registered on the Equipment Note Register as the absolute owner and Noteholder of such Equipment Note for the purpose of receiving payment of all amounts payable with respect to such Equipment Note and for all other purposes, and neither Company nor Loan Trustee shall be affected by any notice to the contrary. Loan Trustee will promptly notify Company of each registration of a transfer of an Equipment Note. Any such transferee of an Equipment Note, by its acceptance of an Equipment Note, agrees to the provisions of the Operative Documents applicable to Noteholders, and shall be deemed to have represented, warranted and covenanted to the parties to the Participation Agreement as to the matters represented, warranted and covenanted by Noteholders, including Pass Through Trustees, in the Participation Agreement. Subject to compliance by Noteholder and any transferee of the requirements set forth in this Section 2.07 and in Section 2.09, Loan Trustee and Company shall use all reasonable efforts to issue new Equipment Notes upon transfer or exchange within ten Business Days of the date an Equipment Note is surrendered for transfer or exchange. Section 2.08 Mutilated, Destroyed, Lost or Stolen Equipment Notes. If any Equipment Note becomes mutilated, destroyed, lost or stolen, Company shall, upon the written request of the holder of such Equipment Note and subject to satisfaction of this Section 2.08 and of Section 2.09, execute and Loan Trustee shall authenticate and deliver in replacement thereof a new Equipment Note of the same Series, payable in the same principal amount, dated the same date and captioned as issued in connection with the Aircraft. If the Equipment Note being replaced has become mutilated, such Equipment Note shall be surrendered to Loan Trustee, and a photocopy thereof shall be furnished to Company. If the Equipment Note being replaced has been destroyed, lost or stolen, the holder of such Equipment Note shall furnish to Company and Loan Trustee such security or indemnity as may be required by them to save Company and Loan Trustee harmless and evidence satisfactory to Company and Loan Trustee of the destruction, loss or theft of such Equipment Note and of the ownership thereof. Section 2.09 Payment of Expenses on Transfer; Cancellation. (a) No service charge shall be made to a Noteholder for any registration of transfer or exchange of Equipment Notes, but Loan Trustee, as Equipment Note Registrar, may require payment of a sum sufficient to cover any Tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Equipment Notes. (b) Loan Trustee shall cancel all Equipment Notes surrendered for replacement, redemption, transfer, exchange, payment or cancellation, shall keep a copy of such canceled Equipment Notes, and shall send the original canceled Equipment Notes marked "canceled" to Company. Section 2.10 Mandatory Redemption of Equipment Notes. Company shall redeem the Equipment Notes in whole in connection with an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon (unless Company has performed the option set forth in Section 7.05(a)(i) with respect thereto) on or before the Loss Payment Date at a redemption price equal to 100% of the unpaid principal amount thereof, together with all accrued interest thereon to (but excluding) the date of redemption, but without any Make-Whole Amount. Section 2.11 Voluntary Redemption of Equipment Notes. All, but not less than all, of the Equipment Notes may be redeemed in whole by Company upon at least 20 days' revocable prior written notice to Loan Trustee at a redemption price equal to 100% of the unpaid principal amount of the Equipment Notes being redeemed, together with accrued interest thereon to (but excluding) the date of redemption and all other amounts payable hereunder or under the Participation Agreement to Noteholders plus the Make-Whole Amount, if any. Any notice shall become irrevocable three days before the redemption date if not previously revoked. Section 2.12 Redemptions; Notice of Redemptions; Repurchases. (a) No redemption of any Equipment Note may be made except to the extent and in the manner expressly permitted by this Indenture. At such time as no Pass Through Certificates are outstanding, Company may at any time repurchase any of the Equipment Notes at any price in the open market and may hold, resell or surrender such Equipment Notes to Loan Trustee for cancellation. (b) Notice of redemption with respect to the Equipment Notes shall be given by Loan Trustee by first-class mail, postage prepaid, mailed not less than 15 nor more than 60 days prior to the applicable redemption date, to each Noteholder at such Noteholder's address appearing in the Equipment Note Register. All notices of redemption shall state: (1) the redemption date, (2) the applicable basis for determining the redemption price, (3) that on the redemption date, the redemption price will become due and payable upon each such Equipment Note, and that, if any such Equipment Notes are then outstanding, interest on such Equipment Notes shall cease to accrue on and after such redemption date and (4) the place or places where such Equipment Notes are to be surrendered for payment of the redemption price. (c) On or before the redemption date, Company (or any person on behalf of Company) shall, to the extent an amount equal to the redemption price for the Equipment Notes to be redeemed on the redemption date shall not then be held in the Collateral, deposit or cause to be deposited with Loan Trustee by 10:00 a.m. (New York City time) on the redemption date in immediately available funds the redemption price of the Equipment Notes to be redeemed. (d) Notice of redemption having been given as aforesaid (and not revoked as permitted by Section 2.11), the Equipment Notes to be redeemed shall, on the redemption date, become due and payable at the Corporate Trust Office of Loan Trustee, and from and after such redemption date (unless there is a default in the deposit of the redemption price pursuant to Section 2.12(c)) any such Equipment Notes then outstanding shall cease to bear interest. Upon surrender of any such Equipment Note for redemption in accordance with said notice, such Equipment Note shall be redeemed at the redemption price. Section 2.13 Subordination. (a) The indebtedness evidenced by the Series G-1 Equipment Notes and Series G-2 Equipment Notes shall rank in right of payment equally with all other Series G-1 Equipment Notes and Series G-2 Equipment Notes. The indebtedness evidenced by the Series C Equipment Notes is, to the extent and in the manner provided in this Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes, and the Series C Equipment Notes are issued subject to such provisions. The indebtedness evidenced by the Series D Equipment Notes is, to the extent and in the manner provided in this Indenture, subordinate and subject in right of payment to the prior payment in full of the Secured Obligations in respect of the Series G-1 Equipment Notes, the Series G-2 Equipment Notes and the Series C Equipment Notes, and the Series D Equipment Notes are issued subject to such provisions. By acceptance of its Equipment Notes of any Series, each Noteholder of such Series (a) agrees to and shall be bound by such provisions, (b) authorizes and directs Loan Trustee on such Noteholder's behalf to take any action necessary or appropriate to effectuate the subordination as provided in this Indenture and (c) appoints Loan Trustee as such Noteholder's attorney-in-fact for such purpose. (b) Company, Loan Trustee and, by acceptance of its Equipment Notes of any Series, each Noteholder of such Series, hereby agree that no payment or distribution shall be made on or in respect of the Secured Obligations owed to such Noteholder of such Series, including any payment or distribution of cash, property or securities, after the occurrence of any of the events referred to in Section 4.01(f) or after the commencement of any proceedings of the type referred to in Sections 4.01(g), (h) or (i), except as expressly provided in Article III. (c) By the acceptance of its Equipment Notes of any Series, each Noteholder of such Series agrees that if such Noteholder, in its capacity as a Noteholder, receives any payment or distribution on any Secured Obligations in respect of such Series that it is not entitled to receive under this Section 2.13 or Article III hereof, it will hold any amount so received in trust for Loan Trustee and forthwith turn over such amount to Loan Trustee in the form received to be applied as provided in Article III. Section 2.14 Certain Payments. Company agrees to pay to Loan Trustee for distribution in accordance with Section 3.04: (a) an amount or amounts equal to the fees payable to Liquidity Provider under Section 2.03 of each Liquidity Facility and the related Fee Letter (as defined in the Intercreditor Agreement), multiplied by a fraction, the numerator of which is the sum of the then outstanding aggregate principal amount of the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes and the denominator of which is the sum of the then outstanding aggregate principal amount of all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement); (b) if any payment default shall have occurred and be continuing with respect to interest on any Series G-1 Equipment Note, Series G-2 Equipment Note or Series C Equipment Note, (x) the excess, if any, of (1) the amount equal to the sum of interest on any Unpaid Advance or Applied Provider Advance payable under Section 3.07 of each Liquidity Facility plus any other amounts payable in respect of such Unpaid Advance or Applied Provider Advance under Section 3.01, 3.03 or 3.09 of the Liquidity Facility under which such Unpaid Advance or Applied Provider Advance was made over (2) the sum of Investment Earnings from any Final Advance plus any amount of interest at the Past Due Rate actually payable (whether or not in fact paid) by Company in respect of the overdue scheduled interest on the Equipment Notes, multiplied by (y) a fraction, the numerator of which is the then aggregate overdue amounts of interest on the Series G-1 Equipment Notes, Series G-2 Equipment Notes and Series C Equipment Notes (other than interest becoming due and payable solely as a result of acceleration of any such Equipment Notes) and the denominator of which is the then aggregate overdue amounts of interest on all "Series G-1 Equipment Notes", "Series G-2 Equipment Notes" and "Series C Equipment Notes" (in each case as defined in the Intercreditor Agreement) (other than interest becoming due and payable solely as a result of acceleration of any such "Equipment Notes"); (c) any amounts owed to Liquidity Provider by Subordination Agent as borrower under Section 3.01 (other than in respect of an Unpaid Advance or Applied Provider Advance), 3.03 (other than in respect of an Unpaid Advance or Applied Provider Advance), 7.05 and 7.07 of each Liquidity Facility multiplied by the fraction specified in the foregoing clause (a); (d) an amount or amounts equal to the compensation, including reasonable expenses and disbursements actually incurred, payable to Subordination Agent under Section 6.07 of the Intercreditor Agreement, multiplied by the fraction specified in the foregoing clause (a) (but in any event without duplication of any amount or amounts payable by Company in respect of such compensation under any other Operative Document or Pass Through Document); and (e) an amount or amounts equal to all compensation and reimbursement of fees, expenses and disbursements (including payment of indemnities) owed to Policy Provider under the Policy Provider Agreement, multiplied by the fraction specified in the foregoing clause (a). For purposes of this paragraph, the terms "Applied Provider Advance", "Cash Collateral Account", "Final Advance", "Investment Earnings", "Replacement Liquidity Facility" and "Unpaid Advance" have the meanings specified in each Liquidity Facility or the Intercreditor Agreement. Section 2.15 Repayment of Monies for Equipment Note Payments Held by Loan Trustee. Any money held by Loan Trustee in trust for any payment of the principal of, Make-Whole Amount, if any, or interest or any other amounts due on, any Equipment Note, including, without limitation, any money deposited pursuant to Section 2.12(c) or Section 10.01, and remaining unclaimed for two years after the due date for such payment (or such lesser time as Loan Trustee is satisfied, after 60 days' notice from Company, is one month prior to the escheat period provided under applicable state law) shall be paid to Company. Noteholders of any outstanding Equipment Notes shall thereafter, as unsecured general creditors, look only to Company for payment thereof, and all liability of Loan Trustee with respect to such trust money shall thereupon cease. Loan Trustee, before being required to make any such repayment, may at the expense of Company cause to be mailed to each such Noteholder notice that such money remains unclaimed. After a date specified in such notice, which may not be less than 30 days from the date of mailing, any unclaimed balance of such money then remaining will be repaid to Company as provided herein. Section 2.16 Directions by Subordination Agent. So long as Subordination Agent is a Noteholder, notwithstanding anything contained herein or in any other Operative Document to the contrary, in exercising its right to vote the Equipment Notes held by it, or in giving or taking any direction, consent, request, demand, instruction, authorization, notice, waiver or other action provided by this Indenture or in respect of the Equipment Notes to be given or taken by a Noteholder (each such vote or other action, a "Direction") in respect of such Equipment Notes, Subordination Agent may act in accordance with any votes, directions, consents, requests, demands, instructions, authorizations, notices, waivers or other actions given or taken by any applicable Pass Through Trustee or the Controlling Party pursuant to the Intercreditor Agreement, including without limitation pursuant to Section 2.06, Article IV or Section 8.01(b) thereof. Subordination Agent shall be permitted (x) to give a Direction with respect to less than the entire principal amount of any single Equipment Note held by it, and (y) to give different Directions with respect to different portions of the principal amount of any single Equipment Note held by it. Any Direction given by Subordination Agent at any time with respect to more than a majority in aggregate unpaid principal amount of all of the Equipment Notes issued and then outstanding hereunder shall be deemed to have been given by a Majority in Interest of Noteholders. ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE COLLATERAL Section 3.01 Basic Distributions. Except as otherwise provided in Sections 3.02, 3.03 and 3.04, each periodic payment by Company of regularly scheduled installments of principal or interest on the Equipment Notes received by Loan Trustee shall be promptly distributed in the following order of priority: first, so much of such payment as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and any other overdue amounts) then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series G-1 Equipment Note or Series G-2 Equipment Note bears to the aggregate amount of the payments then due under all Series G-1 Equipment Notes and Series G-2 Equipment Notes; second, after giving effect to clause "first" above, so much of such payment remaining as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and other overdue amounts) then due under all Series C Equipment Notes shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series C Equipment Note bears to the aggregate amount of the payments then due under all Series C Equipment Notes; third, after giving effect to clause "second" above, so much of such payment remaining as is required to pay in full the aggregate amount of the payment or payments of principal amount and interest (as well as any interest on any overdue principal amount and, to the extent permitted by applicable law, on any overdue interest and any other overdue amounts) then due under all Series D Equipment Notes shall be distributed to Noteholders of Series D Equipment Notes ratably, without priority of one over the other, in the proportion that the amount of such payment or payments then due under each Series D Equipment Note bears to the aggregate amount of the payments then due under all Series D Equipment Notes; and fourth, the balance, if any, of such installment remaining thereafter shall be distributed to Company. Section 3.02 Event of Loss; Optional Redemption. Except as otherwise provided in Sections 3.03 and 3.04 and subject to the following proviso, any payments received by Loan Trustee with respect to the Aircraft as the result of (a) an Event of Loss (including amounts paid by Company pursuant to Section 2.10) or (b) an optional redemption of the Equipment Notes pursuant to Section 2.11 shall be applied to redemption of the Equipment Notes pursuant to Section 2.10 or Section 2.11, as applicable, and to payment of all other Secured Obligations by applying such funds in the following order of priority: first, (i) to reimburse Loan Trustee and Noteholders for any reasonable costs or expenses actually incurred in connection with such redemption for which they are entitled to reimbursement, or indemnity by Company, under the Operative Documents; and then (ii) to pay any other amounts then due (except as provided in clause "second" below) to Loan Trustee, Noteholders and Indenture Indemnitees under this Indenture, the Participation Agreement or the Equipment Notes; second, (i) to pay the amounts specified in subclause (i) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series G-1 Equipment Notes and the Series G-2 Equipment Notes; (ii) after giving effect to subclause (i) above, to pay the amounts specified in subclause (ii) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series C Equipment Notes; and (iii) after giving effect to subclause (ii) above, to pay the amounts specified in subclause (iii) of clause "third" of Section 3.03 plus Make-Whole Amount, if any, then due and payable in respect of the Series D Equipment Notes; and third, the balance, if any, of such payments shall be distributed to Company. Notwithstanding the foregoing, any insurance, condemnation or similar proceeds resulting from an Event of Loss that are received by Loan Trustee shall be held or disbursed by Loan Trustee as provided by Sections 7.05(c) and 7.06(d). Any such money held by Loan Trustee shall be invested as provided in Section 5.06. No Make-Whole Amount shall be payable on the Equipment Notes in connection with their redemption as a result of an Event of Loss in respect of the Airframe or the Airframe and the Engines installed thereon. Section 3.03 Payments after Event of Default. Except as otherwise provided in Section 3.04, all payments received and amounts held or realized by Loan Trustee (including any amounts realized by Loan Trustee from the exercise of any remedies pursuant to Article IV) after both an Event of Default shall have occurred and be continuing and the Equipment Notes shall have become due and payable pursuant to Section 4.02(a), as well as all payments or amounts then held by Loan Trustee as part of the Collateral, shall be promptly distributed by Loan Trustee in the following order of priority: first, so much of such payments or amounts as is required to (i) reimburse Loan Trustee, to the extent Loan Trustee is entitled to be reimbursed or indemnified under the Operative Documents, for any Tax, expense or other loss (including, without limitation, all amounts to be expended at the expense of, or charged upon the tolls, rents, revenues, issues, products and profits of, the Collateral and every part thereof pursuant to Section 4.02(a)) actually incurred by Loan Trustee (to the extent not previously reimbursed), the expenses of any sale, taking or other proceeding, reasonable attorneys' fees and expenses, court costs and any other expenditures actually incurred or expenditures or advances made by Loan Trustee or Noteholders in the protection, exercise or enforcement of any right, power or remedy or any damages sustained by Loan Trustee or any Noteholder, liquidated or otherwise, upon such Event of Default shall be applied by Loan Trustee as between itself and Noteholders in reimbursement of such expenses and any other expenses for which Loan Trustee or Noteholders are entitled to reimbursement under any Operative Document, and (ii) to pay all amounts payable (except as provided in clauses "second" and "third" below) to the other Indenture Indemnitees hereunder and under the Participation Agreement; and in case the aggregate amount so to be distributed is insufficient to pay as aforesaid, then ratably, without priority of one over the other, in proportion to the amounts owed each hereunder; second, so much of such payments or amounts remaining as is required to reimburse the then existing or prior Noteholders for payments made pursuant to Section 5.03 (to the extent not previously reimbursed) shall be distributed to such then existing or prior Noteholders ratably, without priority of one over the other, in accordance with the amount of the payment or payments made by each such then existing or prior Noteholder pursuant to Section 5.03; third, (i) so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series G-1 Equipment Notes and Series G-2 Equipment Notes to the date of distribution shall be distributed to Noteholders of Series G-1 Equipment Notes and Series G-2 Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series G-1 Equipment Notes and Series G-2 Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; (ii) after giving effect to subclause (i) above, so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series C Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series C Equipment Notes to the date of distribution shall be distributed to Noteholders of Series C Equipment Notes ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series C Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series C Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and (iii) after giving effect to subclause (ii) above, so much of such payments or amounts remaining as is required to pay in full the aggregate unpaid principal amount of all Series D Equipment Notes and the accrued but unpaid interest and all other Secured Obligations in respect of the Series D Equipment Notes to the date of distribution shall be distributed to Noteholders of Series D Equipment Notes, ratably, without priority of one over the other, in the proportion that the aggregate unpaid principal amount of all Series D Equipment Notes held by each Noteholder plus the accrued but unpaid interest and other amounts due hereunder or thereunder to the date of distribution bears to the aggregate unpaid principal amount of all Series D Equipment Notes held by all such Noteholders plus the accrued but unpaid interest and other amounts due thereon to the date of distribution; and fourth, the balance, if any, of such payments or amounts shall be distributed to Company. No Make-Whole Amount shall be payable on the Equipment Notes as a consequence of or in connection with an Event of Default or the acceleration of the Equipment Notes. Section 3.04 Certain Payments. (a) Any payments received by Loan Trustee for which provision as to the application thereof is made in this Indenture other than in this Article III shall be applied as provided in those provisions. Without limiting the foregoing, any payments received by Loan Trustee which are payable to Company pursuant to any of the provisions of this Indenture other than those set forth in this Article III (including Sections 5.06, 7.05 and 7.06 hereof) shall be so paid to Company. Any payments received by Loan Trustee for which no provision as to the application thereof is made in this Indenture and for which such provision is made in any other Operative Document shall be applied forthwith to the purpose for which such payment was made in accordance with the terms of such other Operative Document. (b) Loan Trustee will distribute promptly upon receipt any indemnity payment received by it from Company pursuant to Section 4.02 of the Participation Agreement in respect of (i) State Street and Loan Trustee, (ii) Subordination Agent, (iii) Pass Through Trustees, (iv) Liquidity Provider and (v) Policy Provider, in each case, directly to the Person entitled thereto. Any payment received by Loan Trustee from Company under Section 2.14 shall be distributed to Subordination Agent to be distributed in accordance with Section 2.03(c) of the Intercreditor Agreement. (c) Any payments received by Loan Trustee not constituting part of the Collateral or otherwise for which no provision as to the application thereof is made in any Operative Document shall be distributed by Loan Trustee to Company. Further, and except as otherwise provided in Sections 3.02, 3.03 and 3.04, all payments received and amounts realized by Loan Trustee with respect to the Aircraft, to the extent received or realized at any time after payment in full of all Secured Obligations or after the conditions set forth in Section 10.01(a)(ii) for the defeasance of this Indenture have been satisfied, as well as any amounts remaining as part of the Collateral after the occurrence of such payment in full or defeasance, shall be distributed by Loan Trustee to Company. Section 3.05 Payments to Company. Any amounts distributed hereunder by Loan Trustee to Company shall be paid to Company (within the time limits contemplated by Section 2.03) by wire transfer of funds of the type received by Loan Trustee at such office and to such account or accounts of such entity or entities as shall be designated by notice from Company to Loan Trustee from time to time. ARTICLE IV EVENTS OF DEFAULT; REMEDIES OF LOAN TRUSTEE Section 4.01 Events of Default. Each of the following events constitutes an "Event of Default" whether such event is voluntary or involuntary or comes about or is effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body and each such Event of Default is deemed to exist and continue so long as, but only as long as, it has not been remedied or explicitly waived: (a) Company fails to make any payment of principal amount of, Make-Whole Amount, if any, or interest on, any Equipment Note within 15 days after such payment is due; (b) Company fails to make payment when the same is due of any amount (other than amounts referred to in Section 4.01(a)) due hereunder, under any Equipment Note or under any other Operative Document, and such failure continues unremedied for 30 days after the receipt by Company of written notice thereof from Loan Trustee or any Noteholder; (c) Company fails to carry and maintain insurance or indemnity on or with respect to the Aircraft in accordance with the provisions of Section 7.06; provided that no such failure to carry and maintain insurance shall constitute an Event of Default until the earlier of (i) the date such failure has continued unremedied for a period of 30 days after receipt by Loan Trustee of the notice of cancellation or lapse referred to in Section 7.06 or (ii) the date such insurance is not in effect as to Loan Trustee; (d) Company fails to perform or observe any other covenant, condition or agreement to be performed or observed by it under any Operative Document, and such failure continues unremedied for a period of 60 days after receipt by Company of written notice thereof from Loan Trustee or any Noteholder; provided that, if such failure is capable of being remedied, no such failure shall constitute an Event of Default for a period of one year after such notice is received by Company so long as Company is diligently proceeding to remedy such failure; (e) any representation or warranty made by Company in any Operative Document was incorrect in any material respect at the time made, and such incorrectness continues to be material to the transactions contemplated hereby and continues unremedied for a period of 60 days after receipt by Company of written notice thereof from Loan Trustee; provided that, if such incorrectness is capable of being remedied, no such incorrectness shall constitute an Event of Default for a period of one year after such notice is received by Company so long as Company is diligently proceeding to remedy such incorrectness; (f) Company consents to the appointment of or the taking of possession by a receiver, trustee or liquidator in respect of a substantial part of its property, admits in writing its inability to pay its debts generally as they come due or makes a general assignment for the benefit of its creditors; (g) Company files a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief as a debtor in a case under any bankruptcy laws or insolvency laws (as in effect at such time) or an answer admitting the material allegations of a petition filed against Company as a debtor in any such case, or Company as a debtor seeks 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 Company seeks an agreement, composition, extension or adjustment with its creditors under such laws; (h) an order, judgment or decree is entered by any court of competent jurisdiction appointing, without the consent of Company, a receiver, trustee or liquidator of Company or sequestering any substantial part of its property, or granting any other relief in respect of Company as a debtor under any bankruptcy laws or insolvency laws (as in effect at such time), and any such order, judgment or decree of appointment or sequestration remains in force undismissed, unstayed or unvacated for a period of 90 days after the date of entry thereof; or (i) a petition against Company as a debtor in a case under the federal bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within 90 days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of corporations that may apply to Company, any court of competent jurisdiction assumes jurisdiction, custody or control of Company or of any substantial part of its property and such jurisdiction, custody or control remains in force unrelinquished, unstayed or unterminated for a period of 90 days; provided, however, that notwithstanding anything to the contrary contained in this Section 4.01, any failure of Company to perform or observe any covenant, condition or agreement shall not constitute an Event of Default if such failure arises by reason of an event referred to in the definition of "Event of Loss" so long as Company is continuing to comply with all of the terms of Section 7.05. Section 4.02 Remedies. (a) If an Event of Default has occurred and is continuing and so long as the same shall continue unremedied, then and in every such case Loan Trustee may, and upon the written instructions of a Majority in Interest of Noteholders, Loan Trustee shall, do one or more of the following to the extent permitted by, and subject to compliance with the requirements of, applicable law then in effect (provided, however, that during any period the Airframe or any Engine is subject to the CRAF Program and is in possession of or being operated under the direction of the United States government or an agency or instrumentality of the United States, Loan Trustee shall not, on account of any Event of Default, be entitled to exercise or pursue any of the powers, rights or remedies described in this Section 4.02 in such manner as to limit Company's control under this Indenture (or any Permitted Lessee's control under any Lease) of the Airframe or such Engine, unless at least 60 days' (or such lesser period as may then be applicable under the Military Airlift Command Program of the United States government) prior written notice of default hereunder has been given by Loan Trustee by registered or certified mail to Company (and any such Permitted Lessee) with a copy addressed to the Contracting Office Representative or other appropriate person for the Military Airlift Command of the United States Air Force under any contract with Company (or such Permitted Lessee) relating to the Aircraft): (i) declare by written notice to Company all the Equipment Notes to be due and payable, whereupon the aggregate unpaid principal amount of all Equipment Notes then outstanding, together with accrued but unpaid interest thereon and other amounts due thereunder (but without Make-Whole Amount), shall immediately become due and payable without presentment, demand, protest or notice, all of which are hereby waived; provided that if an Event of Default referred to in Subsections 4.01(f), (g), (h) or (i) has occurred and is continuing, then and in every such case the unpaid principal amount then outstanding, together with accrued but unpaid interest and all other amounts due thereunder (but without Make-Whole Amount) shall immediately and without further act become due and payable without presentment, demand, protest or other notice, all of which are hereby waived; and, following such declaration or deemed declaration: (ii) (A) cause Company, upon the demand by notice of Loan Trustee, at Company's expense, to deliver promptly, and Company shall deliver promptly, all or such part of the Airframe or any Engine as Loan Trustee so demands to Loan Trustee or its order, or, if Company has failed to so deliver the Airframe or any Engine after such demand, Loan Trustee, at its option, may enter upon the premises where all or any part of the Airframe or any Engine are located and take immediate possession of and remove the same together with any engine which is not an Engine but which is installed on the Airframe, subject to all of the rights of the owner, lessor, lienor or secured party of such engine; provided that the Airframe with an engine (which is not an Engine) installed thereon may be flown or returned only to a location within the continental United States, and such engine shall be held for the account of any such owner, lessor, lienor, secured party or, if such engine is owned by Company, may at the option of Company with the consent of Loan Trustee (which will not be unreasonably withheld) or at the option of Loan Trustee with the consent of Company (which will not be unreasonably withheld), be exchanged with Company for an Engine in accordance with the provisions of Section 7.05(b); (B) sell all or any part of the Airframe and any Engine at public or private sale, whether or not Loan Trustee at the time has possession thereof, as Loan Trustee may determine, or otherwise dispose of, hold, use, operate, lease to others or keep idle all or any part of the Airframe or such Engine as Loan Trustee, in its sole discretion, determines, all free and clear of any rights or claims of Company, and the proceeds of such sale or disposition shall be applied as set forth in Section 3.03; or (C) exercise any other remedy of a secured party under the Uniform Commercial Code of the State of New York (whether or not in effect in the jurisdiction in which enforcement is sought). Upon every such taking of possession of Collateral under this Section 4.02, Loan Trustee may, from time to time, at the expense of the Collateral, make all such expenditures for maintenance, insurance, repairs, alterations, additions and improvements to and of the Collateral as it deems necessary to cause the Collateral to be in such condition as required by the provisions of this Indenture. In each such case, Loan Trustee may maintain, use, operate, store, lease, control or manage the Collateral and may exercise all rights and powers of Company relating to the Collateral as Loan Trustee reasonably deems best, including the right to enter into any and all such agreements with respect to the maintenance, use, operation, storage, leasing, control, management or disposition of the Collateral or any part thereof as Loan Trustee may reasonably determine; and Loan Trustee shall be entitled to collect and receive directly all tolls, rents, revenues, issues, income, products and profits of the Collateral and every part thereof. Such tolls, rents, revenues, issues, income, products and profits shall be applied to pay the expenses of the use, operation, storage, leasing, control, management or disposition of the Collateral, and of all maintenance, repairs, replacements, alterations, additions and improvements, and to make all payments that Loan Trustee is required or elects to make, if any, for Taxes, insurance or other proper charges assessed against or otherwise imposed upon the Collateral or any part thereof, and all other payments which Loan Trustee is required or expressly authorized to make under any provision of this Indenture, as well as just and reasonable compensation for the services of Loan Trustee, and shall otherwise be applied in accordance with Article III. If an Event of Default has occurred and is continuing and the Equipment Notes either have been accelerated pursuant to this Section 4.02 or have become due at maturity and Loan Trustee is entitled to exercise rights hereunder, at the request of Loan Trustee, Company shall promptly execute and deliver to Loan Trustee such instruments of title and other documents as Loan Trustee reasonably deems necessary or advisable to enable Loan Trustee or an agent or representative designated by Loan Trustee, at such time or times and place or places as Loan Trustee specifies, to obtain possession of all or any part of the Collateral to which Loan Trustee at the time is entitled hereunder. If Company for any reason fails to execute and deliver such instruments and documents after such request by Loan Trustee, Loan Trustee may obtain a judgment conferring on Loan Trustee the right to immediate possession and requiring Company to execute and deliver such instruments and documents to Loan Trustee, to the entry of which judgment Company hereby specifically consents to the fullest extent it may lawfully do so. (b) Loan Trustee shall give Company at least 30 days' prior written notice of any public sale or of the date on or after which any private sale will be held, which notice Company hereby agrees to the extent permitted by applicable law is reasonable notice. Any Noteholder or Noteholders shall be entitled to bid for and become the purchaser of any Collateral offered for sale pursuant to this Section 4.02 and to credit against the purchase price bid at such sale by such Noteholders all or any part of the unpaid amounts owing to such Noteholders under the Operative Documents and secured by the Lien of this Indenture (but only to the extent that such purchase price would have been paid to such Noteholders pursuant to Article III if such purchase price were paid in cash and the foregoing provision of this Section 4.02(b) were not given effect). Loan Trustee may exercise such right without possession or production of the Equipment Notes or proof of ownership thereof, and as a representative of Noteholders may exercise such right without notice to Noteholders as parties to any suit or proceeding relating to the foreclosure of any Collateral. Company may also bid for and become the purchaser of any Collateral offered for sale pursuant to this Section 4.02. (c) To the extent permitted by applicable law, while an Event of Default has occurred and is continuing, Company irrevocably appoints Loan Trustee the true and lawful attorney-in-fact of Company (which appointment is coupled with an interest) in its name and stead and on its behalf, for the purpose of effectuating any sale, assignment, transfer or delivery for the enforcement of the Lien of this Indenture, whether pursuant to foreclosure or power of sale, or otherwise, to execute and deliver all such bills of sale, assignments and other instruments as may be necessary or appropriate, with full power of substitution, Company hereby ratifying and confirming all that such attorney or any substitute does by virtue hereof in accordance with applicable law; provided that if so requested by Loan Trustee or any purchaser, Company shall ratify and confirm any such sale, assignment or transfer of delivery, by executing and delivering to Loan Trustee or such purchaser all bills of sale, assignments, releases and other proper instruments to effect such ratification and confirmation as may be designated in any such request. (d) At any time after Loan Trustee has declared the unpaid principal amount of all Equipment Notes then outstanding to be due and payable and prior to the sale of any part of the Collateral pursuant to this Article IV, a Majority in Interest of Noteholders, by written notice to Company and Loan Trustee, may rescind and annul such declaration, whether made by Loan Trustee on its own accord or as directed, and its consequences if: (i) there has been paid to or deposited with Loan Trustee an amount sufficient to pay all overdue installments of principal amount of, and interest on, the Equipment Notes, and all other amounts owing under the Operative Documents, that have become due otherwise than by such declaration of acceleration and (ii) all other Events of Default, other than nonpayment of principal amount or interest on the Equipment Notes that have become due solely because of such acceleration, have been either cured or waived. (e) Notwithstanding anything contained herein, so long as Pass Through Trustee under any Pass Through Trust Agreement or Subordination Agent on its behalf is a Noteholder, Loan Trustee will not be authorized or empowered to acquire title to any Collateral or take any action with respect to any Collateral so acquired by it if such acquisition or action would cause any Pass Through Trust to fail to qualify as a "grantor trust" for federal income tax purposes. Section 4.03 Remedies Cumulative. To the extent permitted under applicable law, each and every right, power and remedy specifically given to Loan Trustee herein or otherwise in this Indenture shall be cumulative and shall be in addition to every other right, power and remedy specifically given herein or now or hereafter existing at law, in equity or by statute, and each and every right, power and remedy whether specifically given herein or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by Loan Trustee, 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 Loan Trustee in the exercise of any right, remedy or power or in the pursuance of any remedy shall, to the extent permitted by applicable law, impair any such right, power or remedy or be construed to be a waiver of any default on the part of Company or to be an acquiescence therein. Section 4.04 Discontinuance of Proceedings. In case Loan Trustee has instituted any proceedings to enforce any right, power or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings have been discontinued or abandoned for any reason or have been determined adversely to Loan Trustee, then and in every such case Company and Loan Trustee shall, subject to any determination in such proceedings, be restored to their former positions and rights hereunder with respect to the Collateral, and all rights, remedies and powers of Loan Trustee shall continue as if no such proceedings had been undertaken (but otherwise without prejudice). Section 4.05 Waiver of Past Defaults. Upon written instruction from a Majority in Interest of Noteholders, Loan Trustee shall waive any past default hereunder and its consequences, and upon any such waiver such default shall cease to exist and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of the Operative Documents, but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon; provided, however, that in the absence of written instructions from each of the affected Noteholders, Loan Trustee shall not waive any default (i) in the payment of the principal amount, Make-Whole Amount, if any, or interest due under any Equipment Note then outstanding (other than with the consent of the holder thereof), or (ii) in respect of a covenant or provision hereof which, under Article IX, cannot be modified or amended without the consent of each such affected Noteholder. Section 4.06 Noteholders May Not Bring Suit Except Under Certain Conditions. A Noteholder of any Series shall not have the right to institute any suit, action or proceeding at law or in equity or otherwise with respect to this Indenture for the appointment of a receiver or for the enforcement of any other remedy under this Indenture, unless: (1) such Noteholder previously shall have given written notice to Loan Trustee of a continuing Event of Default; (2) A Majority in Interest of Noteholders shall have requested Loan Trustee in writing to institute such action, suit or proceeding and shall have offered to Loan Trustee indemnity as provided in Section 5.03; (3) Loan Trustee shall have refused or neglected to institute any such action, suit or proceeding for 60 days after receipt of such notice, request and offer of indemnity; and (4) no direction inconsistent with such written request shall have been given to Loan Trustee during such 60-day period by a Majority in Interest of Noteholders. Except to the extent provided in the Intercreditor Agreement or in any Indenture Supplement, it is understood and intended that no one or more of Noteholders of any Series shall have any right in any manner whatsoever hereunder or under the Indenture Supplement or under the Equipment Notes of such Series to (i) surrender, impair, waive, affect, disturb or prejudice any Collateral, or the Lien of the Indenture on any Collateral, or the rights of Noteholders of such Series, (ii) obtain or seek to obtain priority over or preference with respect to any other such Noteholder of such Series or (iii) enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal, ratable and common benefit of all Noteholders of such Series subject to the provisions of this Indenture. ARTICLE V DUTIES OF LOAN TRUSTEE Section 5.01 Notice of Event of Default. If Loan Trustee has knowledge of an Event of Default or of a default arising from a failure by Company to pay when due any payment of principal amount, interest or Make-Whole Amount, if any, due and payable under any Equipment Note, Loan Trustee shall promptly give notice thereof to Company and each Noteholder; provided, however, that except in the case of a default in the payment of the principal amount, interest or Make-Whole Amount, if any, due and payable under any Equipment Note, Loan Trustee shall be protected in withholding the notice to Noteholders required in the foregoing part of this sentence if and so long as the executive committee or trust committee of directors of Loan Trustee and/or trust officers thereof in good faith determine that withholding such notice is in the interest of Noteholders. Subject to the terms of Sections 4.02, 4.05, 5.02 and 5.03, Loan Trustee shall take such action, or refrain from taking such action, with respect to such Event of Default (including with respect to the exercise of any rights or remedies hereunder) as Loan Trustee is instructed in writing by a Majority in Interest of Noteholders. Subject to the provisions of Section 5.03, if Loan Trustee does not receive instructions as above provided within 20 Business Days after giving notice of such Event of Default to Noteholders, Loan Trustee may, subject to instructions thereafter received pursuant to the preceding provisions of this Section 5.01, take such action, or refrain from taking such action with respect to such Event of Default as it reasonably determines to be advisable in the best interests of Noteholders, but shall be under no duty to take or refrain from taking any action. It shall use the same degree of care and skill in connection therewith as a prudent person would use under the circumstances in the conduct of his or her own affairs. Loan Trustee may not sell the Airframe or any Engine without the consent of a Majority in Interest of Noteholders. For all purposes of this Indenture, in the absence of actual knowledge, Loan Trustee shall not be deemed to have knowledge of a default or an Event of Default unless notified in writing by Company or one or more Noteholders; and "actual knowledge" (as used in the foregoing clause) of Loan Trustee shall mean actual knowledge of an officer in the Corporate Trust Division of Loan Trustee; provided, however, that Loan Trustee is deemed to have actual knowledge of (i) the failure of Company to pay any principal amount of, or interest on, the Equipment Notes directly to Loan Trustee when the same shall become due or (ii) the failure of Company to maintain insurance as required under Section 7.06 if Loan Trustee receives written notice thereof from an insurer or insurance broker. Section 5.02 Action upon Instructions; Certain Rights and Limitations. Subject to the terms of Article IV and this Article V, upon the written instructions at any time of a Majority in Interest of Noteholders, Loan Trustee shall promptly (i) give such notice, direction, consent, waiver or approval or exercise such right, remedy or power hereunder in respect of all or any part of the Collateral or (ii) take such other action, as is specified in such instructions. Loan Trustee will cooperate with Company in connection with the recording, filing, re-recording and refiling of the Indenture and any supplements to it and any financing statements or other documents as is necessary to maintain the perfection hereof or otherwise protect the security interests created hereby. Loan Trustee shall furnish to Company upon request such information and copies of such documents as Loan Trustee may have and as are necessary for Company to perform its duties under Article II hereof. Section 5.03 Indemnification. Loan Trustee shall not be required to take any action or refrain from taking any action under Sections 5.01 (other than the first sentence thereof) or 5.02 or Article IV unless it shall have received indemnification against any risks incurred in connection therewith in form and substance reasonably satisfactory to it, including, without limitation, adequate advances against costs that may be incurred by it in connection therewith. Loan Trustee shall not be required to take any action under Section 5.01 (other than the first sentence thereof) or 5.02 or Article IV, nor shall any other provision of any Operative Document be deemed to impose a duty on Loan Trustee to take any action, if Loan Trustee shall have been advised by outside counsel that such action is contrary to the terms hereof or is otherwise contrary to law. Section 5.04 No Duties Except as Specified in Indenture or Instructions. Loan Trustee shall not have any duty or obligation to manage, control, lease, use, sell, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Collateral, or to otherwise take or refrain from taking any action under, or in connection with, this Indenture, except as expressly provided by the terms of this Indenture or the Participation Agreement or as expressly provided in written instructions received pursuant to the terms of Section 5.01 or 5.02; and no implied duties or obligations shall be read into this Indenture against Loan Trustee. Section 5.05 No Action Except under Indenture or Instructions. Loan Trustee will not manage, control, use, sell, lease, operate, store, dispose of or otherwise deal with the Aircraft or any other part of the Collateral except in accordance with the powers granted to, or the authority conferred upon, Loan Trustee pursuant to this Indenture and in accordance with the express terms hereof. Section 5.06 Investment of Amounts Held by Loan Trustee. Any monies (including for the purpose of this Section 5.06 any cash deposited with Loan Trustee by Company, any cash received by Loan Trustee pursuant to Sections 7.05(c) or 7.06(d) or otherwise) or Permitted Investments purchased by the use of such cash pursuant to this Section 5.06 or any cash constituting the proceeds of the maturity, sale or other disposition of any Permitted Investments) held by Loan Trustee hereunder as part of the Collateral, until paid out by Loan Trustee as herein provided, (i) subject to clause (ii) below, may be carried by Loan Trustee on deposit with itself or on deposit to its account with any bank, trust company or national banking association incorporated or doing business under the laws of the United States or one of the states thereof having combined capital and surplus and retained earnings of a least $100,000,000, and Loan Trustee shall not have any liability for interest upon any such monies except as otherwise agreed in writing with Company, or (ii) at any time and from time to time, so long as no Event of Default shall have occurred and be continuing, at the request of Company, shall be invested and reinvested in Permitted Investments as specified in such request (if such investments are reasonably available for purchase) and sold, in any case at such prices, including accrued interest or its equivalent, as are set forth in such request, and such Permitted Investments shall be held by Loan Trustee in trust as part of the Collateral until so sold; provided that Company shall upon demand pay to Loan Trustee the amount of any loss realized upon maturity, sale or other disposition of any such Permitted Investment and, so long as no Event of Default or Payment Default shall have occurred and be continuing, Company shall be entitled to receive from Loan Trustee, and Loan Trustee shall promptly pay to Company, any profit, income, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment. If an Event of Default or Payment Default shall have occurred and be continuing, any net income, profit, interest, dividend or gain realized upon maturity, sale or other disposition of any Permitted Investment shall be held as part of the Collateral and shall be applied by Loan Trustee at the same time, on the same conditions and in the same manner as the amounts in respect of which such income, profit, interest, dividend or gain was realized are required to be distributed in accordance with the provisions hereof pursuant to which such amounts were required to be held. Loan Trustee shall not be responsible for any losses on any investments or sales of Permitted Investments made pursuant to the procedure specified in this Section 5.06 other than by reason of its willful misconduct or negligence. If any moneys or investments are held by Loan Trustee solely because an Event of Default has occurred and is continuing and such moneys or investments have been held for a period of 90 consecutive days during which such Event of Default is continuing without any remedial action being taken by Loan Trustee in respect of such Event of Default pursuant to Section 4.02 hereof, and provided that there is no stay, moratorium or injunction in effect preventing the taking of such action, then, notwithstanding any other provision of the Operative Documents, all such moneys and investments held by Loan Trustee shall be released to Company on such 90th day, or on the next Business Day after such 90th day. ARTICLE VI LOAN TRUSTEE Section 6.01 Acceptance of Trusts and Duties. State Street accepts the trusts and duties hereby created and applicable to it and agrees to perform such duties, but only upon the terms of this Indenture and agrees to receive, handle and disburse all monies received by it as Loan Trustee constituting part of the Collateral in accordance with the terms hereof. State Street shall have no liability hereunder except (a) for its own willful misconduct or negligence, (b) as provided in the fourth sentence of Section 2.03 and the penultimate sentence of Section 5.06, (c) for liabilities that may result from the inaccuracy of any representation or warranty of State Street in the Participation Agreement or expressly made hereunder and (d) as otherwise expressly provided in the Operative Documents. Section 6.02 Absence of Certain Duties. Except in accordance with written instructions furnished pursuant to Sections 5.01, 5.02 or 6.06, and except as provided in, and without limiting the generality of, Sections 5.02, 5.03 and 5.04, Loan Trustee shall have no duty (a) to see to any registration of the Aircraft or any recording or filing of this Indenture or any other document, or to see to the maintenance of any such registration, recording or filing, (b) to see to any insurance on the Aircraft or to effect or maintain any such insurance, whether or not Company is in default with respect thereto, (c) to confirm, verify or inquire into the failure to receive any financial statements of Company or (d) to inspect the Aircraft at any time or ascertain or inquire as to the performance or observance of any of Company's covenants hereunder with respect to the Aircraft. Section 6.03 No Representations or Warranties as to the Documents. Except as provided in Article 5 of the Participation Agreement, Loan Trustee shall not be deemed to have made any representation or warranty as to the validity, legality or enforceability of any Operative Document or any other document or instrument, or as to the correctness of any statement (other than a statement by Loan Trustee) contained herein or therein, except that Loan Trustee hereby represents and warrants that each of said specified documents to which it is a party has been or will be duly executed and delivered by one of its officers who is and will be duly authorized to execute and deliver such document on its behalf. Section 6.04 No Segregation of Monies; No Interest. Subject to Section 5.06 hereof, all moneys received by Loan Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by mandatory provisions of law, and neither Loan Trustee nor any agent of Loan Trustee shall be under any liability for interest on any moneys received by it hereunder; provided, however, that any payments received, or applied hereunder, by Loan Trustee shall be accounted for by Loan Trustee so that any portion thereof paid or applied pursuant hereto shall be identifiable as to the source thereof. Section 6.05 Reliance; Agents; Advice of Counsel. Loan Trustee shall not incur any liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. Loan Trustee may accept a copy of a resolution of the Board of Directors of any party to the Participation Agreement, certified by the Secretary or an Assistant Secretary of such party as duly adopted and in full force and effect, as conclusive evidence that such resolution has been duly adopted and that the same is in full force and effect. As to any fact or matter the manner of ascertainment of which is not specifically described herein, Loan Trustee may for all purposes hereof rely on a certificate, signed by a duly authorized officer of Company, as to such fact or matter, and such certificate shall constitute full protection to Loan Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. In the administration of the trusts hereunder, Loan Trustee may, with the consent of Company (such consent not to be unreasonably withheld), (a) execute any of the trusts or powers hereof and perform its powers and duties hereunder directly or through agents (including paying agents or registrars) or attorneys, and (b) at the expense of the Collateral, consult with counsel, accountants and other skilled Persons to be selected and retained by it. Loan Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled Persons acting within such counsel's, accountants' or Person's area of competence (so long as Loan Trustee shall have exercised reasonable care and judgment in selecting such Persons). Section 6.06 Instructions from Noteholders. In the administration of the trusts created hereunder, Loan Trustee shall have the right to seek instructions from a Majority in Interest of Noteholders should any provision of this Indenture appear to conflict with any other provision herein or any other Operative Document or Pass Through Document or should Loan Trustee's duties or obligations hereunder be unclear, and Loan Trustee shall incur no liability in refraining from acting until it receives such instructions. Loan Trustee shall be fully protected for acting in accordance with any instructions received under this Section 6.06. ARTICLE VII OPERATING COVENANTS OF COMPANY Section 7.01 Liens. Company will not directly or indirectly create, incur, assume or suffer to exist any Lien on or with respect to the Aircraft, its title thereto or any of its interest therein, except: (a) the respective rights of Loan Trustee and Company as provided in the Operative Documents, the Lien of this Indenture, the rights of any Permitted Lessee under a Lease permitted hereunder and the rights of any Person existing pursuant to the Operative Documents or the Pass Through Documents; (b) the rights of others under agreements or arrangements to the extent expressly permitted by this Indenture; (c) Loan Trustee Liens, Noteholder Liens and Other Party Liens; (d) Liens for Taxes either not yet due or payable or being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Loan Trustee's interest therein or materially impair the Lien of this Indenture; (e) materialmen's, mechanics', workers', repairmen's, employees' or other like Liens arising in the ordinary course of business (including those arising under maintenance agreements entered into in the ordinary course of business) securing obligations that either are not yet overdue for a period of more than 60 days or are being contested in good faith by appropriate proceedings so long as such proceedings do not involve any material risk of the sale, forfeiture or loss of the Airframe or any Engine or Loan Trustee's interest therein or materially impair the Lien of this Indenture; (f) Liens arising out of any judgment or award, so long as such judgment is, within 60 days after the entry thereof, discharged, vacated or reversed, or execution thereof stayed pending appeal or other judicial review or is discharged, vacated or reversed within 60 days after the expiration of such stay; (g) any other Lien with respect to which Company provides a bond, cash collateral or other security adequate in the reasonable opinion of Loan Trustee; (h) salvage or similar rights of insurers under insurance policies maintained by Company; and (i) Liens approved in writing by Loan Trustee with the consent of a Majority in Interest of Noteholders. Liens described in clauses (a) through (i) above are referred to herein as "Permitted Liens". Company shall promptly, at its own expense, take (or cause to be taken) such action as may be necessary duly to discharge (by bonding or otherwise) any Lien other than a Permitted Lien arising at any time with respect to the Aircraft, its title thereto or any of its interest therein. Section 7.02 Possession, Operation and Use, Maintenance and Registration. (a) Possession. Without the prior written consent of Loan Trustee, Company shall not lease or otherwise in any manner deliver, transfer or relinquish possession of the Airframe or any Engine or install any Engine, or permit any Engine to be installed, on any airframe other than the Airframe; provided that Company (or, except with respect to clauses (viii) and (ix) below, any Permitted Lessee) may without the prior written consent of Loan Trustee: (i) subject the Airframe to interchange agreements or subject any Engine to interchange or pooling agreements or arrangements, in each case entered into by Company (or any Permitted Lessee) in the ordinary course of its business; provided that (A) no such agreement or arrangement contemplates or requires the transfer of title to the Airframe and (B) if Company's title to any such Engine is divested under any such agreement or arrangement, such divestiture shall be deemed to be an Event of Loss with respect to such Engine, and Company shall (or shall cause any Permitted Lessee to) comply with Section 7.05(b) in respect thereof; (ii) deliver possession of the Airframe or any Engine to any Person for testing, service, repair, restoration, storage, maintenance or other similar purposes or for alterations, modifications or additions to the Airframe or such Engine to the extent required or permitted by the terms hereof; (iii) transfer or permit the transfer of possession of the Airframe or any Engine to any Government pursuant to a lease, contract or other instrument; (iv) subject (or permit any Permitted Lessee to subject) the Airframe or any Engine to the CRAF Program or transfer (or permit any Permitted Lessee to transfer) possession of the Airframe or any Engine to the United States government in accordance with applicable laws, rulings, regulations or orders (including, without limitation, any transfer of possession pursuant to the CRAF Program); provided, that Company (or any Permitted Lessee) (A) shall promptly notify Loan Trustee upon transferring possession of the Airframe or any Engine pursuant to this clause (iv) and (B) in the case of a transfer of possession pursuant to the CRAF Program, shall notify Loan Trustee of the name and address of the responsible Contracting Office Representative for the Military Airlift Command of the United States Air Force or other appropriate Person to whom notices must be given and to whom requests or claims must be made to the extent applicable under the CRAF Program; (v) install an Engine on an airframe owned by Company (or any Permitted Lessee) free and clear of all Liens, except (A) Permitted Liens and Liens that apply only to the engines (other than Engines), appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment (other than Parts) installed on such airframe (but not to the airframe as an entirety) and (B) the rights of third parties under interchange agreements or pooling or similar arrangements that would be permitted under clause (i) above; (vi) install an Engine on an airframe leased to Company (or any Permitted Lessee) or purchased or owned by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement; provided that: (A) such airframe is free and clear of all Liens except (1) the rights of the parties to the lease or conditional sale or other security agreement covering such airframe, or their successors and assigns, and (2) Liens of the type permitted by clause (v) of this Section 7.02(a); and (B) either: (1) Company has obtained from the lessor or secured party of such airframe a written agreement (which may be the lease, conditional sale or other security agreement covering such airframe), in form and substance satisfactory to Loan Trustee (an agreement from such lessor or secured party substantially in the form of the penultimate paragraph of this Section 7.02(a) being deemed to be satisfactory to Loan Trustee), whereby such lessor or secured party expressly agrees that neither it nor its successors or assigns will acquire or claim any right, title or interest in any Engine by reason of such Engine being installed on such airframe at any time while such Engine is subject to the Lien of this Indenture, or (2) such lease, conditional sale or other security agreement provides that such Engine shall not become subject to the Lien of such lease, conditional sale or other security agreement at any time while such Engine is subject to the Lien of this Indenture, notwithstanding its installation on such airframe; (vii) install an Engine on an airframe owned by Company (or any Permitted Lessee), leased to Company (or any Permitted Lessee) or purchased by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement under circumstances where neither clause (v) nor clause (vi) of this Section 7.02(a) is applicable; provided that such installation shall be deemed an Event of Loss with respect to such Engine, and Company shall comply with Section 7.05(b) in respect thereof, if such installation adversely affects Loan Trustee's security interest in such Engine, Loan Trustee not intending hereby to waive any right or interest it may have to or in such Engine under applicable law until compliance by Company with Section 7.05(b); (viii) lease any Engine or the Airframe and Engines to any United States air carrier as to which there is in force a certificate issued pursuant to the Transportation Code (49 U.S.C. Sections 41101-41112) or successor provision that gives like authority; and (ix) lease any Engine or the Airframe and Engines to (A) any foreign air carrier other than those set forth in clause (B), (B) any foreign air carrier that is at the inception of the lease based in and a domiciliary of a country listed in Exhibit B hereto, (C) the manufacturer of the Airframe or any Engine (either directly or through an affiliate) and (D) any foreign air carrier consented to in writing by Loan Trustee with the consent of a Majority in Interest of Noteholders; provided that (x) in the case of a lease to a foreign air carrier under clause (A) above, Loan Trustee receives at the time of such lease (1) written confirmation from each of the Rating Agencies that such lease would not result in a reduction of the rating for any class of Pass Through Certificates below the then current rating for such class of Pass Through Certificates or a withdrawal or suspension of the rating of any class of Pass Through Certificates, without regard to the Policy (as defined in the Policy Provider Agreement) and (2) an opinion of counsel to Company (such counsel to be reasonably satisfactory to Loan Trustee) to the effect that there exist no possessory rights in favor of the lessee under the laws of such lessee's country which would, upon bankruptcy or insolvency of or other default by Company and assuming at such time such lessee is not insolvent or bankrupt, prevent the taking of possession of any such Engine or the Airframe and any such Engine by Loan Trustee in accordance with and when permitted by the terms of Section 4.02 upon the exercise by Loan Trustee of its remedies under Section 4.02, (y) in the case of a lease to any foreign air carrier (other than a foreign air carrier principally based in Taiwan), the United States maintains diplomatic relations with the country in which such foreign air carrier is based at the time such lease is entered into and (z) in the case of any lease to a foreign air carrier, such carrier is not then subject to any bankruptcy, insolvency, liquidation, reorganization, dissolution or similar proceeding and shall not have substantially all of its property in the possession of any liquidator, trustee, receiver or similar person; provided that the rights of any lessee or other transferee who receives possession of the Aircraft, the Airframe or any Engine by reason of a transfer permitted by this Section 7.02(a) (other than the transfer of an Engine which is deemed an Event of Loss) shall be subject and subordinate to, and any permitted lease shall be made expressly subject and subordinate to, all the terms of this Indenture, including Loan Trustee's rights to repossess pursuant to Section 4.02 and to avoid such lease upon such repossession, and Company shall remain primarily liable hereunder for the performance and observance of all of the terms and conditions of this Indenture to the same extent as if such lease or transfer had not occurred, any such lease shall include appropriate provisions for the maintenance and insurance of the Aircraft, the Airframe or such Engine, and no lease or transfer of possession otherwise in compliance with this Section shall (x) result in any registration or re-registration of the Aircraft except to the extent permitted in Section 7.02(e) or the maintenance, operation or use thereof that does not comply with Section 7.02(b) and (c) or (y) permit any action not permitted to be taken by Company with respect to the Aircraft hereunder. Company shall promptly notify Loan Trustee and the Rating Agencies of the existence of any such lease with a term in excess of one year. Loan Trustee, and each Noteholder by acceptance of an Equipment Note, agrees, for the benefit of Company (and any Permitted Lessee) and for the benefit of the lessor or secured party of any airframe or engine leased to Company (or any Permitted Lessee) or purchased or owned by Company (or any Permitted Lessee) subject to a conditional sale or other security agreement, that Loan Trustee and Noteholders will not acquire or claim, as against Company (or any Permitted Lessee) or such lessor or secured party, any right, title or interest in: (A) any engine or engines owned by Company (or any Permitted Lessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of such engine or engines being installed on the Airframe, or (B) any airframe owned by Company (or any Permitted Lessee) or by the lessor under such lease or subject to a security interest in favor of the secured party under such conditional sale or other security agreement as the result of any Engine being installed on such airframe. Loan Trustee acknowledges that any "wet lease" or other similar arrangement under which Company (or any Permitted Lessee) maintains operational control of the Aircraft does not constitute a delivery, transfer or relinquishment of possession for purposes of this Section 7.02(a). (b) Operation and Use. Company agrees that the Aircraft will not be maintained, used or operated in violation of any law, rule or regulation of any government of any country having jurisdiction over the Aircraft or in violation of any airworthiness certificate, license or registration relating to the Aircraft issued by any such government, except to the extent Company (or, if a Lease is then in effect, any Permitted Lessee) is contesting in good faith the validity or application of any such law, rule or regulation in any manner that does not involve any material risk of sale, forfeiture or loss of the Aircraft or materially impair the Lien of this Indenture; provided, that Company shall not be in default under, or required to take any action set forth in, this sentence if it is not possible for it to comply with the laws of a jurisdiction other than the United States (or other than any jurisdiction in which the Aircraft is then registered) because of a conflict with the applicable laws of the United States (or such jurisdiction in which the Aircraft is then registered). Company will not operate the Aircraft, or permit the Aircraft to be operated or located, (i) in any area excluded from coverage by any insurance required by the terms of Section 7.06 or (ii) in any war zone or recognized or, in Company's judgment, threatened areas of hostilities unless covered by war risk insurance in accordance with Section 7.06, unless in the case of either clause (i) or (ii), (x) indemnification complying with Section 7.06 (a) and (b) has been provided or (y) the Aircraft is only temporarily located in such area as a result of an isolated occurrence or isolated series of occurrences attributable to a hijacking, medical emergency, equipment malfunction, weather conditions, navigational error or other similar unforeseen circumstances and Company is using its good faith efforts to remove the Aircraft from such area as promptly as practicable. (c) Maintenance. Company shall maintain, service, repair and overhaul the Aircraft (or cause the same to be done) so as to keep the Aircraft in good operating condition and in such condition as may be necessary to enable the airworthiness certification of the Aircraft to be maintained in good standing at all times (other than during temporary periods of storage, during maintenance, testing or modification permitted hereunder, or during periods of grounding by applicable governmental authorities) under the Transportation Code, during such periods in which the Aircraft is registered under the laws of the United States, or, if the Aircraft is registered under the laws of any other jurisdiction, the applicable laws of such jurisdiction. In any case, the Aircraft will be maintained in accordance with the maintenance standards required by the FAA (while operated under an FAA-approved maintenance program) or, while operated under the maintenance program of another jurisdiction, standards substantially equivalent to those required by the central aviation authority of Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Spain, Sweden, Switzerland or the United Kingdom. Company shall maintain or cause to be maintained all records, logs and other documents required to be maintained in respect of the Aircraft by appropriate authorities in the jurisdiction in which the Aircraft is registered. (d) Identification of Loan Trustee's Interest. Company agrees to affix as promptly as practicable after the Closing Date and thereafter to maintain in the cockpit of the Aircraft, in a clearly visible location, and (if not prevented by applicable law or regulations or by any government) on each Engine, a nameplate bearing the inscription "MORTGAGED TO STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, AS LOAN TRUSTEE" (such nameplate to be replaced, if necessary, with a nameplate reflecting the name of any successor Loan Trustee). (e) Registration. Company shall cause the Aircraft to remain duly registered, under the laws of the United States, in the name of Company except as otherwise required by the Transportation Code; provided that Loan Trustee shall, at Company's expense, execute and deliver all such documents as Company may reasonably request for the purpose of continuing such registration. Notwithstanding the preceding sentence, Company, at its own expense, may cause or allow the Aircraft to be duly registered under the laws of any foreign jurisdiction in which a Permitted Lessee could be principally based, in the name of Company or of any nominee of Company, or, if required by applicable law, in the name of any other Person (and, following any such foreign registration, may cause the Aircraft to be re-registered under the laws of the United States); provided, that in the case of jurisdictions other than those approved by Loan Trustee with the consent of a Majority in Interest of Noteholders (i) if such jurisdiction is at the time of registration listed on Exhibit B, Loan Trustee shall have received at the time of such registration an opinion of counsel to Company to the effect that (A) this Indenture and Loan Trustee's right to repossession thereunder is valid and enforceable under the laws of such country, (B) after giving effect to such change in registration, the Lien of this Indenture shall continue as a valid Lien and shall be duly perfected in the new jurisdiction of registration and that all filing, recording or other action necessary to perfect and protect the Lien of this Indenture has been accomplished (or if such opinion cannot be given at such time, (x) the opinion shall detail what filing, recording or other action is necessary and (y) Loan Trustee shall have received a certificate from a Responsible Officer of Company that all possible preparations to accomplish such filing, recording and other action shall have been done, and such filing, recording and other action shall be accomplished and a supplemental opinion to that effect shall be promptly delivered to Loan Trustee subsequent to the effective date of such change in registration), (C) the obligations of Company under this Indenture shall remain valid, binding and (subject to customary bankruptcy and equitable remedies exceptions and to other exceptions customary in foreign opinions generally) enforceable under the laws of such jurisdiction (or the laws of the jurisdiction to which the laws of such jurisdiction would refer as the applicable governing law) and (D) all approvals or consents of any government in such jurisdiction having jurisdiction required for such change in registration shall have been duly obtained and shall be in full force and effect, and (ii) if such jurisdiction is at the time of registration not listed on Exhibit B, Loan Trustee shall have received (in addition to the opinions set forth in clause (i) above) at the time of such registration an opinion of counsel to Company to the effect that (A) the terms of this Indenture are legal, valid, binding and enforceable in such jurisdiction (subject to exceptions customary in such jurisdiction, provided, that, subject to exceptions relating to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and exceptions relating to general principles of equity, such counsel shall opine that any applicable laws limiting the remedies provided in Section 4.02 do not in the opinion of such counsel make the remedies provided in Section 4.02 inadequate for the practical realization of the rights and benefits provided thereby), (B) that it is not necessary for Loan Trustee to register or qualify to do business in such jurisdiction, (C) that there is no tort liability of the lender of an aircraft not in possession thereof under the laws of such jurisdiction other than tort liability that might have been imposed on such lender under the laws of the United States or any state thereof (it being understood that such opinion shall be waived if insurance reasonably satisfactory to Loan Trustee is provided, at Company's expense, to cover such risk) and (D) (unless Company shall have agreed to provide insurance covering the risk of requisition of use or title of the Aircraft by the government of such jurisdiction so long as the Aircraft is registered under the laws of such jurisdiction) that the laws of such jurisdiction require fair compensation by the government of such jurisdiction payable in currency freely convertible into Dollars for the loss of use or title of the Aircraft in the event of requisition by such government of such use or title. Loan Trustee will cooperate with Company in effecting such foreign registration. Notwithstanding the foregoing, prior to any such change in the country of registry of the Aircraft, the following conditions shall be met (or waived as provided in Section 6.01(b) of the Participation Agreement): (i) no Event of Default shall have occurred and be continuing at the effective date of the change in registration; provided, that it shall not be necessary to comply with this condition if the change in registration results in the registration of the Aircraft under the laws of the United States or if a Majority in Interest of Noteholders consents to such change in registration; (ii) Loan Trustee shall have received evidence of compliance with the insurance provisions contained herein after giving effect to such change in registration; and (iii) Company shall have paid or made provision reasonably satisfactory to Loan Trustee for the payment of all reasonable expenses (including reasonable attorneys' fees) of Loan Trustee and Noteholders in connection with such change in registration. Section 7.03 Inspection; Financial Information. (a) Inspection. At all reasonable times, but upon at least 15 Business Days' prior written notice to Company, Policy Provider or Loan Trustee or their respective authorized representatives may, subject to the other conditions of this Section 7.03(a), inspect the Aircraft and may inspect the books and records of Company relating to the maintenance of the Aircraft required to be maintained by the FAA or the government of another jurisdiction in which the Aircraft is then registered; provided, that (i) Policy Provider or Loan Trustee or their respective representatives, as the case may be, shall be fully insured at no cost to Company in a manner satisfactory to Company with respect to any risks incurred in connection with any such inspection or shall provide to Company a written release satisfactory to Company with respect to such risks, (ii) any such inspection shall be during Company's normal business hours and subject to the safety, security and workplace rules applicable at the location where such inspection is conducted and any applicable governmental rules or regulations, (iii) any such inspection of the Aircraft shall be a visual, walk-around inspection of the interior and exterior of the Aircraft and shall not include opening any panels, bays or the like without Company's express consent, which consent Company may in its sole discretion withhold, and (iv) no exercise of such inspection right shall interfere with the use, operation or maintenance of the Aircraft by, or the business of, Company and Company shall not be required to undertake or incur any additional liabilities in connection therewith. All information obtained in connection with any such inspection of the Aircraft and of such books and records shall be Confidential Information and shall be treated by Policy Provider and Loan Trustee and their respective representatives in accordance with the provisions of Section 10.16. Any inspection pursuant to this Section 7.03(a) shall be at the sole risk (including, without limitation, any risk of personal injury or death) and expense of Policy Provider or Loan Trustee (or their respective representatives) making such inspection. Except during the continuance of an Event of Default, all inspections by Policy Provider and Loan Trustee and their respective representatives provided for under this Section 7.03(a) shall be limited to one inspection of any kind contemplated by this Section 7.03(a) during any consecutive twelve month period. (b) Financial Information. So long as any of the Equipment Notes remain unpaid, Company agrees to furnish to Loan Trustee, Policy Provider and Liquidity Provider: (i) within 60 days after the end of each of the first three quarterly periods in each fiscal year of Company, either (x) a consolidated balance sheet of Company and its consolidated subsidiaries prepared by it as of the close of such period, together with the related consolidated statements of income for such period or (y) a report of Company on Form 10-Q in respect of such period in the form filed with the Securities and Exchange Commission and (ii) within 120 days after the close of each fiscal year of Company, either (x) a consolidated balance sheet of Company and its consolidated subsidiaries as of the close of such fiscal year, together with the related consolidated statements of income for such fiscal year, certified by independent public accountants, or (y) a report of Company on Form 10-K in respect of such year in the form filed with the Securities and Exchange Commission. Company may fulfill the requirements of this Section 7.03(b) by providing the material described above in an electronic format by electronic mail or accessible over the Internet. Section 7.04 Replacement and Pooling of Parts; Alterations, Modifications and Additions; Substitution of Engines. (a) Replacement of Parts. Company shall promptly replace or cause to be replaced all Parts incorporated or installed in or attached to the Airframe or any Engine and that become worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use for any reason, except as otherwise provided in Section 7.04(c) or if the Airframe or an Engine to which a Part relates has suffered an Event of Loss. In addition, Company (or any Permitted Lessee) may remove in the ordinary course of maintenance, service, repair, overhaul or testing, any Parts, whether or not worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or rendered permanently unfit for use; provided that Company (or any Permitted Lessee), except as otherwise provided in Section 7.04(c), will replace such Parts as promptly as practicable. All replacement Parts shall be free and clear of all Liens (except for Permitted Liens and except in the case of replacement property temporarily installed on an emergency basis) and shall be in the condition and repair required to be maintained by the terms hereof. Except as otherwise provided in Section 7.04(c), any Parts removed from the Airframe or any Engine shall remain subject to the Lien of this Indenture no matter where located until it is replaced by a part incorporated or installed in or attached to the Airframe or such Engine that meets the requirements for replacement Parts specified above. Immediately upon any replacement Part becoming incorporated or installed in or attached to the Airframe or any Engine as above provided (except in the case of replacement property temporarily installed on an emergency basis), without further act, (i) the replaced Part shall thereupon be free and clear of all rights of Loan Trustee and of the Lien of this Indenture and shall no longer be deemed a Part hereunder, and (ii) such replacement Part shall become subject to the Lien of this Indenture and be deemed a Part of the Airframe or such Engine for all purposes to the same extent as the Parts originally incorporated or installed in or attached to the Airframe or such Engine. Upon request of Company from time to time, Loan Trustee shall execute and deliver to Company an appropriate instrument confirming the release of any such replaced Part from the Lien of this Indenture. (b) Pooling of Parts. Any Part removed from the Airframe or any Engine as provided in Section 7.04(a) may be subjected by Company or a Person permitted to be in possession of the Aircraft to a pooling arrangement entered into in the ordinary course of Company's or such Person's business; provided that the part replacing such removed Part shall be incorporated or installed in or attached to the Airframe or such Engine in accordance with Section 7.04(a) as promptly as practicable after the removal of such removed Part. In addition, any replacement Part when incorporated or installed in or attached to the Airframe or any Engine may be owned by any third party subject to such a pooling arrangement; provided that Company, at its expense, as promptly thereafter as practicable either (i) causes title to such replacement Part to vest in Company free and clear of all Liens (except Permitted Liens), or (ii) replaces such replacement Part by incorporating or installing in or attaching to the Airframe or such Engine a further replacement Part in the manner contemplated by Section 7.04(a). (c) Alterations, Modifications and Additions. Company will make (or cause to be made) such alterations and modifications in and additions to the Airframe and the Engines as are required from time to time to meet the applicable requirements of the FAA or any applicable government of any other jurisdiction in which the Aircraft is then registered; provided, however, that Company (or, if a Lease is then in effect, any Permitted Lessee) may, in good faith, contest the validity or application of any such requirement in any manner that does not involve any material risk of sale, loss or forfeiture of the Aircraft and does not materially adversely affect Loan Trustee's interest in the Aircraft. In addition, Company (or any Permitted Lessee), at its own expense, may from time to time add further parts or accessories and make or cause to be made such alterations and modifications in and additions to the Airframe or any Engine as Company (or any Permitted Lessee) deems desirable in the proper conduct of its business, including, without limitation, removal (without replacement) of Parts, provided that no such alteration, modification or addition shall materially diminish the value or utility of the Airframe or such Engine below its value or utility immediately prior to such alteration, modification or addition, assuming that the Airframe or such Engine was then in the condition required to be maintained by the terms of this Indenture, except that the value (but not the utility) of the Airframe or any Engine may be reduced by the value of any such Parts that are removed that Company deems obsolete or no longer suitable or appropriate for use on the Airframe or any Engine. All Parts incorporated or installed in or attached or added to the Airframe or any Engine as the result of such alteration, modification or addition shall, without further act, be subject to the Lien of this Indenture. Notwithstanding the foregoing, Company (or any Permitted Lessee) may, at any time, remove any Part from the Airframe or any Engine if such Part: (i) is in addition to, and not in replacement of or substitution for, any Part originally incorporated or installed in or attached to the Airframe or such Engine at the time of delivery thereof to Company or any Part in replacement of, or substitution for, any such Part, (ii) is not required to be incorporated or installed in or attached or added to the Airframe or such Engine pursuant to the first sentence of this Section 7.04(c) and (iii) can be removed from the Airframe or such Engine without materially diminishing the value or utility required to be maintained by the terms of this Indenture that the Airframe or such Engine would have had at such time had such removal not occurred. Upon the removal by Company (or any Permitted Lessee) of any Part as permitted by this Section 7.04(c), such removed Part shall, without further act, be free and clear of all rights and interests of Loan Trustee and the Lien of this Indenture and shall no longer be deemed a Part hereunder. Upon request of Company from time to time, Loan Trustee shall execute and deliver to Company an appropriate instrument confirming the release of any such removed Part from the Lien of this Indenture. (d) Substitution of Engines. Company shall have the right at its option at any time, on at least 30 days' prior written notice to Loan Trustee, to substitute a Replacement Engine for any Engine. In such event, and prior to the date of such substitution, Company shall replace such Engine by complying with the terms of Section 7.05(b) to the same extent as if an Event of Loss had occurred with respect to such Engine. Section 7.05 Loss, Destruction or Requisition. (a) Event of Loss with Respect to the Airframe. Upon the occurrence of an Event of Loss with respect to the Airframe or the Airframe and the Engines then installed thereon, Company shall as soon as practicable (and, in any event, within 30 days after an Event of Loss has occurred) notify Loan Trustee of such Event of Loss, and, within 90 days after such Event of Loss, Company shall give Loan Trustee written notice of its election to perform one of the following options (it being agreed that if Company has not given such notice of election within such 90-day period, Company shall be deemed to have elected to perform the option set forth in the following clause (ii)). Company may elect either to: (i) substitute, on or before the Loss Payment Date (as defined below), as replacement for the Airframe or Airframe and Engines with respect to which an Event of Loss has occurred, a Replacement Airframe (together with a number of Replacement Engines equal to the number of Engines, if any, with respect to which the Event of Loss occurred), such Replacement Airframe and Replacement Engines to be owned by Company free and clear of all Liens (other than Permitted Liens); provided that if Company has not performed such obligation on or prior to the Loss Payment Date, then Company shall on the Loss Payment Date prepay the Equipment Notes in full in accordance with Section 2.10; or (ii) redeem, on or before the Loss Payment Date, the Equipment Notes in full in accordance with Section 2.10. Company shall give Loan Trustee 20 days prior written notice if it elects to redeem the Equipment Notes on any day prior to the Loss Payment Date. The "Loss Payment Date" with respect to an Event of Loss means the Business Day next succeeding the 120th day following the date of occurrence of such Event of Loss. If Company elects to substitute a Replacement Airframe (or a Replacement Airframe and one or more Replacement Engines, as the case may be) Company shall, at its sole expense, not later than the Loss Payment Date, (A) cause an Indenture Supplement for such Replacement Airframe and Replacement Engines, if any, to be delivered to Loan Trustee for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of such other jurisdiction in which the Aircraft is then registered, (B) cause a financing statement or statements with respect to the Replacement Airframe and Replacement Engines, if any, or other requisite documents or instruments to be filed in such place or places as necessary in order to perfect Loan Trustee's interest therein in the United States, or in any other jurisdiction in which the Aircraft is then registered, (C) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel of Company) addressed to Loan Trustee to the effect that upon such replacement, such Replacement Airframe and Replacement Engines, if any, will be subject to the Lien of this Indenture and addressing the matters set forth in clauses (A) and (B), (D) furnish Loan Trustee with a certificate of an independent aircraft engineer or appraiser, certifying that the Replacement Airframe and Replacement Engines, if any, have a value and utility (without regard to hours or cycles) at least equal to the Airframe and Engines, if any, so replaced, assuming the Airframe and such Engines were in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss, (E) furnish Loan Trustee with evidence of compliance with the insurance provisions of Section 7.06 with respect to such Replacement Airframe and Replacement Engines, if any, and (F) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel of Company) to the effect that Loan Trustee will be entitled to the benefits of Section 1110 with respect to the Replacement Airframe, provided that (i) such opinion need not be delivered to the extent that the benefits of Section 1110 were not, by reason of a change in law or governmental or judicial interpretation thereof, available to Loan Trustee with respect to the Aircraft immediately prior to such substitution and (ii) such opinion may contain qualifications and assumptions of the tenor contained in the Section 1110 opinion of Company's special counsel delivered pursuant to Section 3.01 of the Participation Agreement on the Closing Date and such other qualifications and assumptions as are at the time customary in opinions rendered in comparable circumstances. In the case of each Replacement Airframe or Replacement Airframe and one or more Replacement Engines subjected to the Lien of this Indenture under this Section 7.05(a), promptly upon the recordation of the Indenture Supplement covering any such Replacement Airframe and Replacement Engines, if any, pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which such Replacement Airframe and Replacement Engines, if any, are registered), Company will cause to be delivered to Loan Trustee a favorable opinion of FAA counsel selected by Company if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Company, which counsel shall be reasonably satisfactory to Loan Trustee) addressed to Loan Trustee as to the due registration of such Replacement Aircraft and the due recordation of such Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Aircraft granted to Loan Trustee under this Indenture. For all purposes hereof, upon the attachment of the Lien of this Indenture thereto, the Replacement Aircraft and Replacement Engines, if any, shall become part of the Collateral, the Replacement Airframe shall be deemed an "Airframe" as defined herein, and each such Replacement Engine shall be deemed an "Engine" as defined herein. Upon compliance with clauses (A) through (F) of the third paragraph of this Section 7.05(a), Loan Trustee shall execute and deliver to Company an appropriate instrument releasing such replaced Airframe and Engines (if any) installed thereon at the time such Event of Loss occurred, all proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of such replaced Airframe and Engines (if any) and all rights relating to the foregoing, from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of the Airframe and Engines arising from the Event of Loss. If, after an Event of Loss, Company performs the option set forth in clause (ii) of the first paragraph of this Section 7.05(a), Loan Trustee shall execute and deliver to Company an appropriate instrument releasing the Aircraft, all proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of the Aircraft and all rights relating to the foregoing from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of the Aircraft arising from the Event of Loss. (b) Event of Loss with Respect to an Engine. Upon the occurrence of an Event of Loss with respect to an Engine under circumstances in which there has not occurred an Event of Loss with respect to the Airframe, Company shall give Loan Trustee prompt written notice thereof and shall, within 120 days after the occurrence of such Event of Loss, cause to be subjected to the Lien of this Indenture, as replacement for the Engine with respect to which such Event of Loss occurred, a Replacement Engine free and clear of all Liens (other than Permitted Liens). Prior to or at the time of any replacement under this Section 7.05(b), Company will (i) cause an Indenture Supplement covering such Replacement Engine to be delivered to Loan Trustee for execution and, upon such execution, to be filed for recordation pursuant to the Transportation Code or the applicable laws of any other jurisdiction in which the Aircraft is then registered, (ii) cause a financing statement or statements with respect to such Replacement Engine or other requisite documents or instruments to be filed in such place or places as necessary in order to perfect Loan Trustee's interest therein in the United States, or in such other jurisdiction in which the Engine is then registered, (iii) furnish Loan Trustee with an opinion of Company's counsel (which may be internal counsel to Company) addressed to Loan Trustee to the effect that, upon such replacement, the Replacement Engine will be subject to the Lien of this Indenture, (iv) furnish Loan Trustee with a certificate of an aircraft engineer or appraiser (who may be an employee of Company) certifying that such Replacement Engine has a value and utility (without regard to hours or cycles) at least equal to the Engine so replaced assuming such Engine was in the condition and repair required by the terms hereof immediately prior to the occurrence of such Event of Loss and (v) furnish Loan Trustee with evidence of compliance with the insurance provisions of Section 7.06 with respect to such Replacement Engine. In the case of each Replacement Engine subjected to the Lien of this Indenture under this Section 7.05(b), promptly upon the recordation of the Indenture Supplement covering such Replacement Engine pursuant to the Transportation Code (or pursuant to the applicable law of such other jurisdiction in which the Aircraft is registered), Company will cause to be delivered to Loan Trustee an opinion of FAA counsel selected by Company if at the time of the Event of Loss the Aircraft was registered under the laws of the United States (or, if at the time of the Event of Loss the Aircraft was registered under the laws of another jurisdiction, counsel qualified to opine on matters of registration in such jurisdiction selected by Company, which counsel shall be reasonably satisfactory to Loan Trustee) addressed to Loan Trustee as to the due recordation of such Indenture Supplement or such other requisite documents or instruments and the validity and perfection of the security interest in the Replacement Engine granted to Loan Trustee under this Indenture. For all purposes hereof, upon the attachment of the Lien of this Indenture thereto, the Replacement Engine shall become part of the Collateral and shall be deemed an "Engine" as defined herein. Upon compliance with clauses (i) through (v) of the first sentence of this paragraph, Loan Trustee shall execute and deliver to Company an appropriate instrument releasing such replaced Engine, any proceeds (including, without limitation, insurance proceeds), the Warranty Rights in respect of such replaced Engine and all rights relating to any of the foregoing from the Lien of this Indenture and assigning to Company all claims against third Persons for damage to or loss of such Engine arising from the Event of Loss. (c) Application of Payments for Event of Loss from Requisition of Title or Use. Any payments other than insurance proceeds (the application of which is provided for in Section 7.06) received at any time by Company or by Loan Trustee from any government or other Person with respect to an Event of Loss to the Airframe or any Engine, will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Company pursuant to Section 7.05(a), such payments shall be paid over to, or retained by, Loan Trustee and upon completion of such replacement shall be paid over to, or retained by, Company; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced pursuant to Section 7.05(a), so much of such payments remaining after reimbursement of Loan Trustee for costs and expenses that shall not exceed the amounts required to be paid to Noteholders pursuant to Section 2.10 shall be applied in reduction of Company's obligation to pay such amounts, if not already paid by Company, or, if already paid by Company, shall be applied to reimburse Company for its payment of such amount and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Company; and (iii) if such payments are received with respect to an Engine with regard to which an Event of Loss has occurred, so much of such payments remaining after reimbursement of Loan Trustee for costs and expenses shall be paid over to, or retained by, Company; provided that Company has fully performed its obligations under Section 7.05(b) with respect to the Event of Loss for which such payments are made. (d) Requisition for Use by the Government of the Airframe and the Engines Installed Thereon. In the event of the requisition for use by any government (it being acknowledged that the use of the Airframe or any Engine pursuant to the CRAF Program does not constitute such a requisition) of the Airframe and the Engines or engines installed on the Airframe that does not constitute an Event of Loss, all of Company's rights and obligations under this Indenture with respect to the Airframe and such Engines shall continue to the same extent as if such requisition had not occurred; provided that, notwithstanding the foregoing, Company's obligations other than payment obligations shall only continue to the extent feasible. All payments received by Company or Loan Trustee from such government for such use of the Airframe and Engines or engines shall be paid over to, or retained by, Company. (e) Requisition for Use by the Government of an Engine not Installed on the Airframe. If any government requisitions the use, for a period in excess of sixty (60) days, of any Engine not then installed on the Airframe, Company will replace such Engine by complying with the terms of Section 7.05(b) to the same extent as if an Event of Loss had occurred with respect to such Engine. Upon such replacement, any payments received by Company or Loan Trustee from such government with respect to such requisition shall be paid over to, or retained by, Company. (f) Application of Payments During Existence of Event of Default. Any amount referred to in Section 7.05 that is payable to or retainable by Company shall not be paid to or retained by Company if at the time of such payment or retention an Event of Default or Payment Default has occurred and is continuing, but shall be held by or paid over to Loan Trustee as security for the obligations of Company under this Indenture. When any such Event of Default or Payment Default ceases, such amount shall be paid to Company. Section 7.06 Insurance. (a) Aircraft Liability Insurance. (i) Except as provided in clause (ii) of this subsection (a), and subject to the rights of Company to establish and maintain self-insurance in the manner and to the extent specified in Section 7.06(c), Company will carry, or cause to be carried, at no expense to Loan Trustee, aircraft liability insurance (including, but not limited to, bodily injury, personal injury and property damage liability, exclusive of manufacturer's product liability insurance) and contractual liability insurance with respect to the Aircraft (A) in amounts that are not less than the aircraft liability insurance applicable to similar aircraft and engines in Company's fleet on which Company carries insurance; provided that such liability insurance shall not be less than the amount certified in the insurance report delivered to Loan Trustee on the Closing Date, (B) of the type covering the same risks as from time to time applicable to aircraft operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as the Aircraft, and (C) that is maintained in effect with insurers of recognized responsibility. Any policies of insurance carried in accordance with this Section 7.06(a) and any policies taken out in substitution or replacement for any of such policies shall: (A) name Loan Trustee, Subordination Agent, each Pass Through Trustee, Policy Provider and Liquidity Provider as their Interests (as defined below in this Section 7.06) may appear, as additional insured (the "Additional Insureds"), (B) subject to the condition of clause (C) below, provide that, in respect of the interest of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Company and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by Company, (C) provide that, if such insurance is canceled for any reason whatever, or if any change is made in the policy that materially reduces the amount of insurance or the coverage certified in the insurance report delivered on the Closing Date to Loan Trustee, Policy Provider and Liquidity Provider, or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to any Additional Insured for 30 days (seven days, or such other period as is then generally available in the industry, in the case of any war risk or allied perils coverage) after receipt by such Additional Insured of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive any rights of (1) set-off, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent that Company has waived its rights by its agreements to indemnify the Additional Insureds pursuant to the Operative Documents, (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft and (G) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covering each insured. "Interests" as used in this Section 7.06(a) and in Section 7.06(b) with respect to any Person means the interests of such Person in the transactions contemplated by the Operative Documents. In the case of a lease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Company, or an insurance policy issued by such government, against any of the risks that Company is required to insure against hereunder shall be considered adequate insurance for purposes of this Section 7.06(a) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine, as the case may be, is on the ground and not being flown, Company may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Subsection 7.06(c), insurance otherwise conforming with the provisions of said clause (i) except that: (A) the amounts of coverage shall not be required to exceed the amounts of airline liability insurance from time to time applicable to airframes or engines owned or leased by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown and (B) the scope of the risks covered and the type of insurance shall be the same as from time to time are applicable to airframes or engines operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown. (b) Insurance Against Loss or Damage to Aircraft. (i) Except as provided in clause (ii) of this subsection (b), and subject to the rights of Company to establish and maintain self-insurance in the manner and to the extent specified in Section 7.06(c), Company shall maintain, or cause to be maintained, in effect with insurers of recognized responsibility, at no expense to Loan Trustee, all-risk aircraft hull insurance covering the Aircraft and all-risk coverage with respect to any Engines or Parts while removed from the Aircraft (including, without limitation, war risk insurance if and to the extent the same is maintained by Company (or, if a Lease is then in effect, by the Permitted Lessee) with respect to other similar aircraft operated by Company or such Permitted Lessee, as the case may be, on the same routes) that is of the type as from time to time applicable to the aircraft operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as the Aircraft; provided that (A) such insurance (including the permitted self-insurance) shall at all times while the Aircraft is subject to this Indenture be for an amount not less than 110% of the aggregate principal amount of the Equipment Notes outstanding from time to time, (B) such insurance need not cover an Engine while attached to an airframe not owned, leased or operated by Company, and (C) such insurance covering Engines and Parts removed from an Airframe or an airframe or (in the case of Parts) an Engine need be obtained only to the extent available at reasonable cost (as reasonably determined by Company). Any policies carried in accordance with this Section 7.06(b) and any policies taken out in substitution or replacement for any such policies shall: (A) provide that any insurance proceeds up to an amount equal to the outstanding principal amount of the Equipment Notes, together with accrued but unpaid interest thereon, plus an amount equal to the interest that would accrue on the outstanding principal amount of the Equipment Notes at the Debt Rate in effect on the date of payment of such insurance proceeds to Loan Trustee (as provided for in this sentence) during the period commencing on the day following the date of such payment to Loan Trustee and ending on the Loss Payment Date (the sum of such three amounts being the "Loan Amount"), payable for any loss or damage constituting an Event of Loss with respect to the Aircraft and any insurance proceeds in excess of the amount set forth on Exhibit C up to the amount of the Loan Amount for any loss or damage to the Aircraft (or Engines) not constituting an Event of Loss with respect to the Aircraft (or Engines), shall be paid to Loan Trustee as long as the Indenture has not been discharged, and that all other amounts shall be payable to Company, unless the insurer has received notice that an Event of Default exists, in which case all insurance proceeds for any loss or damage to the Aircraft (or Engines) up to the Loan Amount shall be payable to Loan Trustee, (B) subject to the conditions of clause (C) below, provide that, in respect of the interests of the Additional Insureds in such policies, the insurance shall not be invalidated by any action or inaction of Company and shall insure the Additional Insureds' Interests as they appear, regardless of any breach or violation by Company of any warranty, declaration or condition contained in such policies, (C) provide that if such insurance is canceled for any reason, or if any change is made in the insurance that materially reduces the coverage (not including the amount) certified in the insurance report delivered on the Closing Date to Loan Trustee and Liquidity Provider or if such insurance is allowed to lapse for nonpayment of premium, such cancellation, change or lapse shall not be effective as to the Additional Insureds for 30 days (seven days, or such other period as is customarily available in the industry, in the case of war risk or allied perils coverage) after receipt by the Additional Insureds of written notice from such insurers of such cancellation, change or lapse, (D) provide that the Additional Insureds shall have no obligation or liability for premiums, commissions, assessments or calls in connection with such insurance, (E) provide that the insurers shall waive rights of (1) setoff, counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of the Additional Insureds to the extent of any moneys due to the Additional Insureds and (2) subrogation against the Additional Insureds to the extent Company has waived its rights by its agreement to indemnify the Additional Insureds pursuant to the Operative Documents and (F) be primary without right of contribution from any other insurance carried by any Additional Insured with respect to its Interests as such in the Aircraft. In the case of a lease or contract with any government in respect of the Aircraft or any Engine, or in the case of any requisition for use of the Aircraft or any Engine by any government, a valid agreement by such government to indemnify Company, or an insurance policy issued by such government, against any risks which Company is required hereunder to insure against shall be considered adequate insurance for purposes of this Section 7.06(b) to the extent of the risks (and in the amounts) that are the subject of such indemnification or insurance. (ii) During any period that the Airframe or an Engine is on the ground and not being flown, Company may carry or cause to be carried as to such non-flown Airframe or Engine, in lieu of the insurance required by clause (i) above, and subject to self-insurance to the extent permitted by Subsection 7.06(c), insurance otherwise conforming with the provisions of said clause (i) except that the scope of the risks covered and the type of insurance shall be the same as from time to time applicable to airframes and engines operated by Company (or, if a Lease is then in effect, by the Permitted Lessee) of the same type as such non-flown Airframe or Engine and that are on the ground and not being flown; provided that, subject to self-insurance to the extent permitted by Subsection 7.06(c), Company shall maintain or cause to be maintained insurance against risk of loss or damage to such non-flown Airframe or Engine in an amount at least equal to 110% of the aggregate outstanding principal amount of the Equipment Notes during such period that such Airframe or Engine is on the ground and not being flown. (c) Self-Insurance. Company may from time-to-time self-insure, by way of deductible, self-insured retention, premium adjustment or franchise or otherwise (including, with respect to insurance maintained pursuant to Subsections 7.06(a) or 7.06(b), insuring for a maximum amount that is less than the amounts set forth in Sections 7.06(a) and 7.06(b)), the risks required to be insured against pursuant to Sections 7.06(a) and 7.06(b), but in no case shall the self-insurance with respect to all of the aircraft and engines in Company's fleet (including, without limitation, the Aircraft) exceed for any 12-month policy year 1% of the average aggregate insurable value (for the preceding policy year) of all aircraft (including, without limitation, the Aircraft) on which Company carries insurance, unless an insurance broker of national standing certifies that the standard among other major United States airlines is a higher level of self-insurance, in which case Company may self-insure the Aircraft to such higher level. In addition to the foregoing right to self-insure, Company may self-insure to the extent of (1) any deductible per occurrence that, in the case of the Aircraft, is not in excess of the amount customarily allowed as a deductible in the industry or is required to facilitate claims handling or (2) any applicable mandatory minimum per aircraft (or if applicable per annum or other period) hull or liability insurance deductibles imposed by the aircraft hull or liability insurers. (d) Application of Insurance Payments. All losses will be adjusted by Company with the insurers. As between Loan Trustee and Company it is agreed that all insurance payments received under policies required to be maintained by Company hereunder, exclusive of any payments received in excess of the Loan Amount for the Aircraft from such policies, as the result of the occurrence of an Event of Loss with respect to the Airframe or an Engine will be applied as follows: (i) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has been or is being replaced by Company pursuant to Section 7.05(a), such payments shall be paid over to, or retained by, Loan Trustee and upon completion of such replacement shall be paid over to, or retained by, Company; (ii) if such payments are received with respect to the Airframe or the Airframe and any Engines installed on the Airframe that has not been and will not be replaced as contemplated by Section 7.05(a), so much of such payments remaining after reimbursement of Loan Trustee for its costs and expenses as do not exceed the amounts required to be paid by Company pursuant to Section 2.10 shall be applied in reduction of Company's obligation to pay such amounts, if not already paid by Company, or, if already paid by Company, shall be applied to reimburse Company for its payment of such amounts and the balance, if any, of such payment remaining thereafter will be paid over to, or retained by, Company; and (iii) if such payments are received with respect to an Engine, so much of such payments remaining after reimbursement of Loan Trustee for its costs and expenses shall be paid over to, or retained by, Company; provided that Company has fully performed its obligations under Section 7.05(b) with respect to the Event of Loss for which such payments are made. In all events, the insurance payment of any property damage loss received under policies maintained by Company in excess of the Loan Amount for the Aircraft shall be paid to Company. The insurance payments for any loss or damage to the Airframe or an Engine not constituting an Event of Loss with respect to the Airframe or such Engine will be applied in payment (or to reimburse Company) for repairs or for replacement property in accordance with the terms of Sections 7.02 and 7.04, and any balance remaining after compliance with such Sections with respect to such loss or damage shall be paid to Company. Any amount referred to in the preceding sentence or in clause (i), (ii) or (iii) of the first paragraph of this Section 7.06(d) that is payable to Company shall not be paid to Company (or, if it has been previously paid directly to Company, shall not be retained by Company) if at the time of such payment an Event of Default or Payment Default has occurred and is continuing, but shall be paid to and held by Loan Trustee as security for the obligations of Company under this Indenture, and when any such Event of Default or Payment Default ceases, such amount shall, to the extent not theretofore applied as provided herein, be paid to Company. (e) Reports, Etc. On or before the Closing Date and annually following renewal of Company's insurance coverage, Company will furnish to Loan Trustee, Policy Provider and Liquidity Provider a report signed by a firm of independent aircraft insurance brokers appointed by Company (which brokers may be in the regular employ of Company), stating the opinion of such firm that the insurance then carried and maintained on the Aircraft complies with the terms hereof. All information contained in such report shall be Confidential Information and shall be treated by Loan Trustee, Policy Provider and Liquidity Provider and each of their affiliates and officers, directors, agents and employees in accordance with the provisions of Section 10.16. Company will cause such firm to notify Loan Trustee, Policy Provider and Liquidity Provider of any act or omission on the part of Company of which such firm has knowledge that might invalidate or render unenforceable, in whole or in part, any insurance on the Aircraft. Company will also cause such firm to notify Loan Trustee, Policy Provider and Liquidity Provider as promptly as practicable after such firm acquires knowledge that an interruption of any insurance carried and maintained on the Aircraft pursuant to this Section 7.06 will occur. Such information may only be provided to other Persons in accordance with Section 10.16. (f) Salvage Rights; Other. All salvage rights to the Airframe and each Engine shall remain with Company's insurers at all times, and any insurance policies of Loan Trustee insuring the Airframe or any Engine shall provide for a release to Company of any and all salvage rights in and to the Airframe or any Engine. Neither Loan Trustee nor any Noteholder may, directly or indirectly, obtain insurance for its own account with respect to the Airframe or any Engine if such insurance would limit or otherwise adversely affect the coverage or amounts payable under, or increase the premiums for, any insurance required to be maintained pursuant to this Section 7.06 or any other insurance maintained with respect to the Aircraft or any other aircraft in Company's fleet. ARTICLE VIII SUCCESSOR AND ADDITIONAL TRUSTEES Section 8.01 Resignation or Removal; Appointment of Successor. (a) The resignation or removal of Loan Trustee and the appointment of a successor Loan Trustee shall become effective only upon the successor Loan Trustee's acceptance of appointment as provided in this Section 8.01. Loan Trustee or any successor thereto must resign if at any time it ceases to be eligible in accordance with the provisions of Section 8.01(c) and may resign at any time without cause by giving at least 60 days' prior written notice to Company and each Noteholder. In addition, either Company (so long as no Event of Default or Payment Default shall have occurred and be continuing) or a Majority in Interest of Noteholders (but only with the consent of Company so long as no Event of Default or Payment Default shall have occurred and be continuing), may at any time remove Loan Trustee without cause by an instrument in writing delivered to Loan Trustee and each Noteholder, and, in case of a removal by a Majority in Interest of Noteholders, to Company. In the case of the resignation or removal of Loan Trustee, Company shall promptly appoint a successor Loan Trustee. If a successor Loan Trustee has not been appointed within 60 days after such notice of resignation or removal, Loan Trustee, Company or any Noteholder may apply to any court of competent jurisdiction to appoint a successor Loan Trustee to act until such time, if any, as a successor is appointed as above provided. The successor Loan Trustee so appointed by such court shall immediately and without further act be superseded by any successor Loan Trustee appointed as above provided. (b) Any successor Loan Trustee, however appointed, shall execute and deliver to the predecessor Loan Trustee and Company an instrument accepting such appointment and assuming the obligations of Loan Trustee arising from and after the time of such appointment, and thereupon such successor Loan Trustee, without further act, shall become vested with all the estates, properties, rights, powers and duties of the predecessor Loan Trustee in the trust hereunder applicable to it with like effect as if originally named Loan Trustee herein; but nevertheless upon the written request of such successor Loan Trustee, such predecessor Loan Trustee shall execute and deliver an instrument transferring to such successor Loan Trustee all the estates, properties, rights and powers of such predecessor Loan Trustee, and such predecessor Loan Trustee shall duly assign, transfer, deliver and pay over to such successor Loan Trustee all monies or other property and all other books and records, or true, correct and complete copies thereof, then held by such predecessor Loan Trustee. (c) This Indenture shall at all times have a Loan Trustee, however appointed, that is a Citizen of the United States (without the use of a voting trust) and a bank or trust company having a combined capital and surplus of at least $100,000,000 (or a combined capital and surplus in excess of $5,000,000 and the obligations of which, whether now in existence or hereafter incurred, are fully and unconditionally guaranteed by a corporation organized and doing business under the laws of the United States or any state or territory thereof or the District of Columbia and having a combined capital and surplus of at least $100,000,000) or a corporation with a net worth of at least $100,000,000, if there be such an institution willing, able and legally qualified to perform the duties of Loan Trustee upon reasonable or customary terms. If such bank, trust company or corporation publishes reports of conditions at least annually, pursuant to law or to the requirements of federal, state, territorial or District of Columbia supervising or examining authority, then for the purposes of this Section 8.01(c) the combined capital and surplus of such bank, trust company or corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of conditions so published. In case at any time Loan Trustee ceases to be eligible in accordance with the provisions of this Section 8.01(c), Loan Trustee shall resign immediately in the manner and with the effect specified in Section 8.01(a). (d) Any corporation into which Loan Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which Loan Trustee is a party, or any corporation to which substantially all the corporate trust business of Loan Trustee may be transferred, shall, subject to the terms of Section 8.01(c), be a successor Loan Trustee under this Indenture without further act. Section 8.02 Appointment of Additional and Separate Trustees. (a) Whenever (i) Loan Trustee deems it necessary or desirable in order to conform to any law of any jurisdiction in which all or any part of the Collateral is situated or to make any claim or bring any suit with respect to or in connection with the Collateral, any Operative Document or any of the transactions contemplated by the Operative Documents, (ii) Loan Trustee shall be advised by counsel satisfactory to it that it is necessary or prudent in the interests of Noteholders (and Loan Trustee shall so advise Company) or (iii) Loan Trustee has been requested to do so by a Majority in Interest of Noteholders, then in any such case, Loan Trustee and, upon the written request of Loan Trustee, Company, shall execute and deliver an indenture supplemental hereto and such other instruments as from time to time are necessary or advisable either (1) to constitute one or more banks or trust companies or corporations meeting the requirements of Section 8.01(c) and approved by Loan Trustee, either to act jointly with Loan Trustee as additional trustee or trustees of all or any part of the Collateral or to act as separate trustee or trustees of all or any part of the Collateral, in each case with such rights, powers, duties and obligations consistent with this Indenture as is provided in such supplemental indenture or other instruments as Loan Trustee or a Majority in Interest of Noteholders deems necessary or advisable, or (2) to clarify, add to or subtract from the rights, powers, duties and obligations theretofore granted any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.02. If no Event of Default has occurred and is continuing, no additional or supplemental trustee shall be appointed without Company's consent. If an Event of Default shall have occurred and be continuing, Loan Trustee may act under the foregoing provisions of this Section 8.02(a) without the concurrence of Company, and Company hereby irrevocably appoints (which appointment is coupled with an interest) Loan Trustee as its agent and attorney-in-fact to act for it under the foregoing provisions of this Section 8.02(a). Loan Trustee may, in such capacity, execute, deliver and perform any such supplemental indenture, or any such instrument, as may be required for the appointment of any such additional or separate trustee or for the clarification of, addition to or subtraction from the rights, powers, duties or obligations theretofore granted to any such additional or separate trustee, subject in each case to the remaining provisions of this Section 8.02. In case any additional or separate trustee appointed under this Section 8.02(a) becomes incapable of acting, resigns or is removed, all the assets, property, rights, powers, trusts, duties and obligations of such additional or separate trustee shall revert to Loan Trustee until a successor additional or separate trustee is appointed as provided in this Section 8.02(a). (b) No additional or separate trustee shall be entitled to exercise any of the rights, powers, duties and obligations conferred upon Loan Trustee in respect of the custody, investment and payment of monies and all monies received by any such additional or separate trustee from or constituting part of the Collateral or otherwise payable under any Operative Documents to Loan Trustee shall be promptly paid over by it to Loan Trustee. All other rights, powers, duties and obligations conferred or imposed upon any additional or separate trustee shall be exercised or performed by Loan Trustee and such additional or separate trustee jointly except to the extent that applicable law of any jurisdiction in which any particular act is to be performed renders Loan Trustee incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations (including the holding of title to all or part of the Collateral in any such jurisdiction) shall be exercised and performed by such additional or separate trustee. No additional or separate trustee shall take any discretionary action except on the instructions of Loan Trustee or a Majority in Interest of Noteholders. No trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder, except that Loan Trustee shall be liable for the consequences of its lack of reasonable care in selecting, and Loan Trustee's own actions in acting with, any additional or separate trustee. Each additional or separate trustee appointed pursuant to this Section 8.02 shall be subject to, and shall have the benefit of Articles IV, V, VI, VIII, IX and X hereof insofar as they apply to Loan Trustee. The powers of any additional or separate trustee appointed pursuant to this Section 8.02 shall not in any case exceed those of Loan Trustee. (c) If at any time Loan Trustee deems it no longer necessary or desirable or in the event that Loan Trustee has been requested to do so in writing by a Majority in Interest of Noteholders, Loan Trustee and, upon the written request of Loan Trustee, Company, shall execute and deliver an indenture supplemental hereto and all other instruments and agreements necessary or proper to remove any additional or separate trustee. Loan Trustee may act on behalf of Company under this Section 8.02(c) when and to the extent it could so act under Section 8.02(a) hereof. In any case, Company may remove an additional or separate trustee in the manner set forth in Section 8.01. ARTICLE IX AMENDMENTS AND WAIVERS Section 9.01 Amendments to this Indenture without Consent of Holders. At any time after the date hereof, Company and Loan Trustee may enter into one or more agreements supplemental hereto without notice to or consent of any Noteholder for any of the following purposes: (i) to evidence the succession of another Person to Company and the assumption by any such successor of the covenants of Company contained in any Operative Documents pursuant to Section 6.02(e) of the Participation Agreement; (ii) to cure any defect or inconsistency herein or in the Equipment Notes; (iii) to cure any ambiguity or correct any mistake; (iv) to evidence the succession of a new trustee hereunder pursuant hereto or the removal of the trustee hereunder or to provide for or facilitate the appointment of an additional or separate trustee pursuant to Section 8.02 hereof; (v) to convey, transfer, assign, mortgage or pledge any property to or with Loan Trustee; (vi) to make any other provisions or amendments with respect to matters or questions arising hereunder or under the Equipment Notes, or to amend, modify or supplement any provision hereof or thereof, so long as such action shall not adversely affect the interests of Noteholders or Liquidity Provider; (vii) to correct or amplify the description of any property at any time subject to the Lien of this Indenture, or better to assure, convey and confirm unto Loan Trustee any property subject or required to be subject to the Lien of this Indenture or to subject to the Lien of this Indenture the Airframe or Engines or any Replacement Airframe or Replacement Engine; (viii) to add to the covenants of Company for the benefit of Noteholders, or to surrender any rights or power herein conferred upon Company; (ix) to add to the rights of Noteholders; (x) to include on the Equipment Notes any legend required by law or as otherwise necessary or advisable and (xi) to comply with any applicable requirements of the Trust Indenture Act of 1939, as amended, or any other requirements of applicable law or of any regulatory body. Section 9.02 Amendments to this Indenture with Consent of Holders. (a) With the written consent of a Majority in Interest of Noteholders, Company may, and Loan Trustee shall, subject to Section 9.06, at any time and from time to time, enter into such supplemental agreements to add any provisions to or to change or eliminate any provisions of this Indenture or of any such supplemental agreements or to modify in any manner the rights and obligations of Company, Loan Trustee and of Noteholders under this Indenture; provided, however, that without the consent of each Noteholder affected thereby, an amendment under this Section 9.02 may not: (1) reduce the principal amount of, Make-Whole Amount, if any, or interest on, any Equipment Note; (2) change the date on which any principal amount of, Make-Whole Amount, if any, or interest on any Equipment Note, is due or payable; (3) create any Lien with respect to the Collateral prior to or pari passu with the Lien thereon under this Indenture except such as are permitted by this Indenture, or deprive any Noteholder of the benefit of the Lien on the Collateral created by this Indenture; (4) reduce the percentage of the outstanding principal amount of the Equipment Notes the consent of whose holders is required for any such supplemental agreement, or the consent of whose holders is required for any waiver of compliance with certain provisions of this Indenture or of certain defaults hereunder or their consequences provided for in this Indenture; or (5) make any change in Section 4.05 or this Section 9.02, except to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of each Noteholder affected thereby. (b) It is not necessary under this Section 9.02 for Noteholders to consent to the particular form of any proposed supplemental agreement, but it is sufficient if they consent to the substance thereof. (c) Promptly after the execution by Company and Loan Trustee of any supplemental agreement pursuant to the provisions of this Section 9.02, Loan Trustee shall transmit by first-class mail a notice, setting forth in general terms the substance of such supplemental agreement, to all Noteholders, as the names and addresses of such Noteholders appear on the Equipment Note Register. Any failure of Loan Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental agreement. Section 9.03 Amendments, Waivers, Etc. of the Participation Agreement. Without the consent of a Majority in Interest of Noteholders, the respective parties to the Participation Agreement may not modify, amend or supplement such agreement, or give any consent, waiver, authorization or approval thereunder, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions thereof or of modifying in any manner the rights of the respective parties thereunder; provided, however, that, without the consent of Loan Trustee or any Noteholder, the Participation Agreement may be modified, amended or supplemented in order (i) to cure any defect or inconsistency therein or to cure any ambiguity or correct any mistake, (ii) to amend, modify or supplement any provision thereof or make any other provision with respect to matters or questions arising thereunder or under this Indenture, provided that the making of any such other provision shall not materially adversely affect the interests of Noteholders or (iii) to make any other change, or reflect any other matter, of the kind referred to in clauses (i) through (xi) of Section 9.01. Notwithstanding the foregoing, without the consent of Liquidity Provider, Company shall not enter into any amendment, waiver or modification of or supplement or consent to the Participation Agreement which shall reduce, modify or amend any indemnities in favor of Liquidity Provider contained therein. Section 9.04 Revocation and Effect of Consents. Until an amendment or waiver becomes effective, a consent to it by a Noteholder is a continuing consent by Noteholder and every subsequent Noteholder, even if notation of the consent is not made on any Equipment Note. Section 9.05 Notation on or Exchange of Equipment Notes. Loan Trustee may place an appropriate notation about an amendment or waiver on any Equipment Note thereafter executed. Loan Trustee in exchange for such Equipment Notes may execute new Equipment Notes that reflect the amendment or waiver. Section 9.06 Trustee Protected. If, in the reasonable opinion of the institution acting as Loan Trustee, any document required to be executed by it pursuant to the terms of Section 9.01 or 9.02 adversely affects any right, duty, immunity or indemnity with respect to such institution under this Indenture, such institution may in its discretion decline to execute such document. ARTICLE X MISCELLANEOUS Section 10.01 Termination of Indenture. (a) Upon (or at any time after): (i) payment in full of the principal amount, Make-Whole Amount, if any, and interest on and all other amounts due under all Equipment Notes and provided that there shall then be no other Secured Obligations due to Noteholders, Indenture Indemnitees and Loan Trustee hereunder or under the Participation Agreement; or (ii) the 91st day after there has been irrevocably deposited (except as provided in Section 2.15 or 10.01(d)) with Loan Trustee as funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of Noteholders: (A) money in an amount, (B) U.S. Government Obligations that, through the payment of interest and principal in respect thereof in accordance with their terms, will provide (not later than one Business Day before the due date of any payment referred to below in this paragraph) money in an amount, or (C) a combination of money and U.S. Government Obligations referred to in the foregoing clause (B), sufficient, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to Loan Trustee, to pay in full the outstanding principal amount of and interest on all the Equipment Notes then outstanding on the dates such amounts are due; provided, however, that (1) Company has delivered to Loan Trustee an officer's certificate and an opinion of counsel to the effect that there has been a change in tax law since April 23, 2002 or has been published by the Internal Revenue Service a ruling to the effect that Noteholders and the holders of the Pass Through Certificates will not recognize income, gain or loss for United States Federal income tax purposes as a result of the exercise by Company of its option under this subsection (ii) and will be subject to United States Federal income tax on the same amounts and in the same manner and at the same times, as would have been the case if such option had not been exercised; (2) all other amounts then due and payable hereunder have been paid; (3) Company has delivered to Loan Trustee an officer's certificate and an opinion of counsel (which may be internal counsel to Company), each stating that all conditions precedent to the satisfaction and discharge of this Indenture set forth in this Section 10.01 have been complied with; (4) such deposit will not result in a breach or violation of, or constitute an Event of Default under, this Indenture; (5) no Event of Default set forth in Sections 4.01(f), (g), (h) or (i) shall have occurred and be continuing on the date of such deposit or at any time during the period beginning on such date and ending on the 91st day after the date of such deposit; and (6) Company has delivered to Loan Trustee written confirmation from each of the Rating Agencies that such deposit, the resulting release and discharge of Company from its obligations under this Indenture and under the Equipment Notes and the release of the Aircraft and the balance of the Collateral from the Lien of this Indenture will not result in a reduction in the rating for any class of Pass Through Certificates below the then current rating for such class of Pass Through Certificates or a withdrawal or suspension of the rating of any class of Pass Through Certificates, without regard to the Policy (as defined in the Policy Provider Agreement); Company and Loan Trustee shall be deemed to have been released and discharged from their respective obligations hereunder and under the Equipment Notes and the security interest, mortgage lien and all other estate, right, title and interest granted by this Indenture shall cease and become null and void and all of the property, rights, interests and privileges granted as security for the Equipment Notes shall revert to and revest in Company without any other act or formality whatsoever, and Loan Trustee shall, upon the written request of Company, execute and deliver to, or as directed in writing by, Company an appropriate instrument (in due form for recording) releasing the Aircraft and the balance of the Collateral from the Lien of this Indenture together with such other instruments and documents as Company reasonably requests to give effect to the release and termination, and, in such event, this Indenture and the trusts created hereby shall terminate and this Indenture shall be of no further force or effect; provided, however, that this Indenture and the trusts created hereby shall earlier terminate and this Indenture shall be of no further force or effect upon any sale or other final disposition by Loan Trustee of all property constituting part of the Collateral and the final distribution by Loan Trustee of all monies or other property or proceeds constituting part of the Collateral in accordance with the terms hereof. Except as otherwise provided above, this Indenture and the trusts created hereby shall continue in full force and effect in accordance with the terms hereof. Upon the deposit of the defeasance funds as described above, the right of Company to cause redemption of the Equipment Notes shall cease. (b) Notwithstanding the provisions of Section 10.01(a)(ii), the obligations of Loan Trustee contained in Sections 2.01, 2.02, 2.03, 2.04, 2.05, 2.07, 2.08, 2.09, 2.13, 2.15, 2.16, 3.01, 10.01(c) and 10.01(d) of this Section 10.01, and the other rights, duties, immunities and privileges hereunder of Loan Trustee, shall survive. (c) All monies and U.S. Government Obligations deposited with Loan Trustee pursuant to Section 10.01(a)(ii) shall be held in trust and applied by it, in accordance with the provisions of the Equipment Notes and this Indenture, to the payment to Noteholders of all sums due and to become due thereon for principal and interest, but such money need not be segregated from other funds received pursuant hereto except to the extent required by law. (d) Loan Trustee shall promptly pay or return to Company upon request of Company any money or U.S. Government Obligations held by it at any time that are not required for the payment of the amounts described above in Section 10.01(c) on the Equipment Notes for which money or U.S. Government Obligations have been deposited pursuant to Section 10.01(a)(ii). Section 10.02 No Legal Title to Collateral in Noteholders. No Noteholder shall have legal title to any part of the Collateral. No transfer, by operation of law or otherwise, of any Equipment Note or other right, title and interest of any Noteholder in and to the Collateral or hereunder shall operate to terminate this Indenture or entitle such Noteholder or any successor or transferee of such holder to an accounting or to the transfer to it of any legal title to any part of the Collateral. Section 10.03 Sale of Aircraft by Loan Trustee is Binding. Any sale or other conveyance of the Aircraft, the Airframe, any Engine or any interest therein by Loan Trustee made pursuant to the terms of this Indenture shall bind Noteholders and Company and shall be effective to transfer or convey all right, title and interest of Loan Trustee, Company and such Noteholders in and to such Aircraft, Airframe, Engine or interest therein. No purchaser or other grantee shall be required to inquire as to the authorization, necessity, expediency or regularity of such sale or conveyance or as to the application of any sale or other proceeds with respect thereto by Noteholders. Section 10.04 Indenture for Benefit of Company, Loan Trustee and Noteholders. Nothing in this Indenture, whether express or implied, shall be construed to give any Person other than Company, Loan Trustee, Noteholders or the other Indenture Indemnitees any legal or equitable right, remedy or claim under or in respect of this Indenture. Section 10.05 Notices. Unless otherwise expressly specified or permitted by the terms hereof, all notices, requests, demands, authorizations, directions, consents, waivers or documents required or permitted under the terms and provisions of this Indenture shall be in English and in writing, and given by United States registered or certified mail, courier service or facsimile, and any such notice shall be effective when delivered (or, if delivered by facsimile, upon completion of transmission and confirmation by the sender (by a telephone call to a representative of the recipient or by machine confirmation) that such transmission was received) addressed as follows: (i) if to Company, addressed to: Delta Air Lines, Inc. 1030 Delta Boulevard Atlanta, Georgia 30320 Attention: Treasurer, Dept. 856 Telephone: (404) 714-1724 Facsimile: (404) 715-4862 with a copy to the General Counsel at the same address, but Dept. 971 Telephone: (404) 715-2387 Facsimile: (404) 715-1657 (ii) if to Loan Trustee, addressed to: State Street Bank And Trust Company of Connecticut, National Association 225 Asylum Street Goodwin Square Hartford, Connecticut 06103 Attention: Corporate Trust Division Telephone: (860) 244-1844 Facsimile: (860) 244-1881 or if to any Noteholder, addressed to such Noteholder at its address set forth in the Equipment Note Register maintained pursuant to Section 2.07 hereof. Any party, by notice to the other parties hereto, may designate different addresses for subsequent notices or communications. Whenever the words "notice" or "notify" or similar words are used herein, they mean the provision of formal notice as set forth in this Section 10.05. Section 10.06 Severability. Any provision of this Indenture that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 10.07 No Oral Modification or Continuing Waivers. No terms or provisions of this Indenture or of the Equipment Notes may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by Company and Loan Trustee, in compliance with Article IX. Any waiver of the terms hereof or of any Equipment Note shall be effective only in the specific instance and for the specific purpose given. Section 10.08 Successors and Assigns. All covenants and agreements contained herein shall bind and inure to the benefit of, and be enforceable by, each of the parties hereto and the successors and permitted assigns of each, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by any Noteholder shall bind the successors and permitted assigns of such Noteholder. Each Noteholder by its acceptance of an Equipment Note agrees to be bound by this Indenture and all provisions of the Participation Agreement applicable to a Noteholder. Section 10.09 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 10.10 Normal Commercial Relations. Anything contained in this Indenture to the contrary notwithstanding, Loan Trustee, any Noteholder or any other party to any of the Operative Documents or the Pass Through Documents or any of their affiliates may conduct any banking or other financial transactions, and have banking or other commercial relationships, with Company, fully to the same extent as if this Indenture were not in effect, including without limitation the making of loans or other extensions of credit to Company for any purpose whatsoever, whether related to any of the transactions contemplated hereby or otherwise. Section 10.11 Voting by Noteholders. All votes of Noteholders shall be governed by a vote of a Majority in Interest of Noteholders, except as otherwise provided herein. Section 10.12 Section 1110. It is the intention of the parties hereto that the security interest created hereby, to the fullest extent available under applicable law, entitles Loan Trustee, on behalf of Noteholders, to all of the benefits of Section 1110 with respect to the Aircraft. Section 10.13 Company's Performance and Rights. Any obligation imposed on Company herein shall require only that Company perform or cause to be performed such obligation, even if stated as a direct obligation, and the performance of any such obligation by any permitted assignee, lessee or transferee under an assignment, lease or transfer agreement then in effect and in accordance with the provisions of the Operative Documents shall constitute performance by Company and, to the extent of such performance, discharge such obligation by Company. Except as otherwise expressly provided herein, any right granted to Company in this Indenture shall grant Company the right to permit such right to be exercised by any such assignee, lessee or transferee. The inclusion of specific references to obligations or rights of any such assignee, lessee or transferee in certain provisions of this Indenture shall not in any way prevent or diminish the application of the provisions of the two sentences immediately preceding with respect to obligations or rights in respect of which specific reference to any such assignee, lessee or transferee has not been made in this Indenture. Section 10.14 Counterparts. This Indenture may be executed in any number of counterparts (and each of the parties hereto shall not be required to execute the same counterpart). Each counterpart of this Indenture including a signature page or pages executed by each of the parties hereto shall be an original counterpart of this Indenture, but all of such counterparts together shall constitute one instrument. Section 10.15 Governing Law. THIS INDENTURE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND THIS INDENTURE, ANY INDENTURE SUPPLEMENT AND THE EQUIPMENT NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 10.16 Confidential Information. The term "Confidential Information" means: (a) the existence and terms of any lease of the Airframe or Engines pursuant to Section 7.02(a) and the identity of the Permitted Lessee thereunder; (b) all information obtained in connection with any inspection conducted by Loan Trustee or its representative pursuant to Section 7.03(a); (c) each certification furnished to Loan Trustee pursuant to Sections 7.06(a) and 7.06(b); (d) all information contained in each report furnished to Loan Trustee pursuant to Section 7.06(e); and (e) all information regarding the Warranty Rights. All Confidential Information shall be held confidential by Loan Trustee and each Noteholder and each affiliate, agent, officer, director, or employee of any thereof and shall not be furnished or disclosed by any of them to anyone other than (i) Loan Trustee or any Noteholder and (ii) their respective bank examiners, auditors, accountants, agents and legal counsel, and except as may be required by an order of any court or administrative agency or by any statute, rule, regulation or order of any governmental authority. Section 10.17 Submission to Jurisdiction. Each of the parties hereto, and by acceptance of Equipment Notes, each Noteholder, to the extent it may do so under applicable law, for purposes hereof and of all other Operative Agreements hereby (a) irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City of New York and to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Indenture, the subject matter hereof or any of the transactions contemplated hereby brought by any party or parties hereto or thereto, or their successors or permitted assigns and (b) waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Indenture or the Equipment Notes or the subject matter hereof or any of the transactions contemplated hereby may not be enforced in or by such courts. IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed by their respective officers thereof duly authorized, as of the date first above written. DELTA AIR LINES, INC. By:_______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity, except as expressly provided herein, but solely as Loan Trustee By:_______________________________________________ Name: Title: EXHIBIT A to INDENTURE AND SECURITY AGREEMENT INDENTURE SUPPLEMENT NO. ___ INDENTURE SUPPLEMENT NO. __ , dated _____________, ____ ("Indenture Supplement"), between DELTA AIR LINES, INC. ("Company") and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity but solely as Loan Trustee under the Indenture (each as hereinafter defined). W I T N E S S E T H: WHEREAS, the Indenture and Security Agreement (N833MH), dated as of April 30, 2002 (the "Indenture"; capitalized terms used herein without definition shall have the meanings specified therefor in Annex A to the Indenture), between Company and State Street Bank and Trust Company of Connecticut, National Association, not in its individual capacity, except as expressly provided therein, but solely as Loan Trustee ("Loan Trustee"), provides for the execution and delivery of supplements thereto substantially in the form hereof which shall particularly describe the Aircraft, and shall specifically grant a security interest in the Aircraft to Loan Trustee; and [WHEREAS, the Indenture relates to the Airframe and Engines described in Annex A attached hereto and made a part hereof, and a counterpart of the Indenture is attached to and made a part of this Indenture Supplement;]* [WHEREAS, Company has, as provided in the Indenture, heretofore executed and delivered to Loan Trustee Indenture Supplement(s) for the purpose of specifically subjecting to the Lien of the Indenture certain airframes and/or engines therein described, which Indenture Supplement(s) is/are dated and has/have been duly recorded with the FAA as set forth below, to wit: Date Recordation Date FAA Document Number]** NOW, THEREFORE, to secure the prompt and complete payment (whether at stated maturity, by acceleration or otherwise) of principal of, Make-Whole Amount, if any, and interest on, the Equipment Notes and all other amounts payable by Company under the Operative Documents and the performance and observance by Company of all the agreements and covenants to be performed or observed by Company for the benefit of Noteholders and Indenture Indemnitees contained in the Operative Documents, and in consideration of the premises and of the covenants contained in the Operative Documents, and for other good and valuable consideration given by Loan Trustee, Noteholders and Indenture Indemnitees to Company at or before the Closing Date, the receipt of which is hereby acknowledged, Company does hereby grant, bargain, sell, convey, transfer, mortgage, assign, pledge and confirm unto Loan Trustee and its successors in trust and permitted assigns, for the security and benefit of Loan Trustee, Noteholders and Indenture Indemnitees, a first priority security interest in, and mortgage lien on, all estate, right, title and interest of Company in, to and under the Aircraft, including the Airframe and Engines described in Annex A attached hereto, whether or not any such Engine from time to time is installed on the Airframe or any other airframe or any other aircraft, and any and all Parts relating thereto, and, to the extent provided in the Indenture, all substitutions and replacements of, and additions, improvements, accessions and accumulations to, the Aircraft, including the Airframe, the Engines and any and all Parts (in each case other than any substitutions, replacements, additions, improvements, accessions and accumulations that constitute items excluded from the definition of Parts by clauses (b), (c), (d), (e) and (f) thereof) relating thereto; - ----------------- * Use for Indenture Supplement No. 1 only. ** Use for all Indenture Supplements other than Indenture Supplement No. 1. To have and to hold all and singular the aforesaid property unto Loan Trustee, and its successors and assigns, in trust for the ratable benefit and security of Noteholders and Indenture Indemnitees, except as otherwise provided in the Indenture, including Section 2.13 and Article III of the Indenture, without any preference, distinction or priority of any one Equipment Note over any other by reason of priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any reason whatsoever, and for the uses and purposes and subject to the terms and provisions set forth in the Indenture. This Indenture Supplement shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and is hereby ratified, approved and confirmed. THIS INDENTURE SUPPLEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement No. __ to be duly executed by their respective duly authorized officers, on the date first above written. DELTA AIR LINES, INC. By:_______________________________________________ Name: Title: STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, as Loan Trustee By:_______________________________________________ Name: Title: Annex A to Indenture Supplement No. __ DESCRIPTION OF AIRFRAME AND ENGINES AIRFRAME Manufacturer Model FAA Registration No. Manufacturer's Serial No. ENGINES Manufacturer Model Manufacturer's Serial No. Each Engine is of 750 or more "rated take-off horsepower" or the equivalent of such horsepower. EXHIBIT B to INDENTURE AND SECURITY AGREEMENT LIST OF PERMITTED COUNTRIES Argentina Grenada Norway Australia Guatemala Paraguay Austria Hungary Peoples' Republic of China Bahamas Iceland Philippines Barbados India Poland Belgium Indonesia Portugal Bermuda Islands Ireland Republic of China (Taiwan) Brazil Italy Singapore British Virgin Islands Jamaica South Africa Canada Japan South Korea Cayman Islands Kuwait Spain Chile Liechtenstein Sweden Czech Republic Luxembourg Switzerland Denmark Malta Thailand Ecuador Mexico Trinidad and Tobago Egypt Monaco United Kingdom Finland Morocco Uruguay France Netherlands Antilles Venezuela Germany Netherlands, the Greece New Zealand EXHIBIT C to INDENTURE AND SECURITY AGREEMENT AIRCRAFT TYPE VALUE FOR SECTION 7.06(b) Boeing 767-432ER - $20,000,000 SCHEDULE I to INDENTURE AND SECURITY AGREEMENT DESCRIPTION OF EQUIPMENT NOTES Original Principal Amount Interest Rate Maturity Date - ---------------- -------------------------- ------------- --------------- Series G-1 Equipment Notes: $16,536,158.27 6.718% January 2, 2012 Series G-2 Equipment Notes: $29,011,605.76 6.417% July 2, 2012 Series C Equipment Notes: $6,782,455.39 7.779% January 2, 2010 Series D Equipment Notes: $7,324,324.89 8.270% July 2, 2007 EQUIPMENT NOTES AMORTIZATION SERIES G-1 EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. EQUIPMENT NOTES AMORTIZATION SERIES C EQUIPMENT NOTES Percentage of Original Principal Amount Payment Date to be Paid The portion of this Schedule appearing below this text is intentionally deleted from the FAA filing counterpart because the parties hereto deem it to contain confidential information. SCHEDULE II to INDENTURE AND SECURITY AGREEMENT PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST SUPPLEMENTS Pass Through Trust Agreement, dated as of November 16, 2000, between Delta Air Lines, Inc. and State Street Bank and Trust Company of Connecticut, National Association, as trustee, as supplemented by Trust Supplement No. 2002-1G-1, dated as of April 30, 2002, Trust Supplement No. 2002-1G-2, dated as of April 30, 2002, Trust Supplement No. 2002-1C, dated as of April 30, 2002 and Trust Supplement No. 2002-1D, dated as of April 30, 2002. EX-99.(A) 16 de763576-ex99a.txt SCHEDULE I Exhibit 99(a) SCHEDULE I ---------- The following documents relating to one Boeing 737-832 aircraft bearing United States registration number N372DA (hereinafter collectively referred to as the "N372DA Documents") have been provided in this filing: (a) Participation Agreement (N372DA), dated as of April 30, 2002, among Delta Air Lines, Inc. (the "Company"), State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee under each of the Pass Through Trust Agreements (the "Pass Through Trustee"), State Street Bank and Trust Company of Connecticut, as Subordination Agent under the Intercreditor Agreement (the Subordination Agent"), State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein ("State Street"); and (b) Indenture and Security Agreement (N372DA), dated as of April 30, 2002, between the Company and the Loan Trustee. The corresponding documents listed below are substantially identical in all material respects to the N372DA Documents, with the following exceptions: (1) conforming changes have been made to reflect the appropriate United States registration number of each aircraft (i.e., N373DA, N374DA, N375DA, etc.), the appropriate model of each aircraft (i.e., 737-832, 757-232, 767-332ER) and the appropriate manufacturer's serial number of each aircraft; (2) the description and original principal amount of the equipment notes set forth on Schedule I to each Participation Agreement differ; (2) the dollar amount set forth on Exhibit C to each Indenture and Security Agreement differs according to the model of each aircraft; (3) conforming changes have been made to reflect the appropriate engines relating to each aircraft (i.e., CFM International, Inc. CFM56-7B26, United Technologies Corporation PW2037, General Electric Company CF6-80C2B8F); and (4) the definitions set forth in Annex A to each Participation Agreement and Indenture and Security Agreement differ. (1)(a) Participation Agreement (N373DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (1)(b) Indenture and Security Agreement (N373DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (2)(a) Participation Agreement (N374DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (2)(b) Indenture and Security Agreement (N374DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (3)(a) Participation Agreement (N375DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (3)(b) Indenture and Security Agreement (N375DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (4)(a) Participation Agreement (N396DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (4)(b) Indenture and Security Agreement (N396DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (5)(a) Participation Agreement (N397DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (5)(b) Indenture and Security Agreement (N397DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (6)(a) Participation Agreement (N398DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (6)(b) Indenture and Security Agreement (N398DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (7)(a) Participation Agreement (N399DA), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (7)(b) Indenture and Security Agreement (N3799DA), dated as of April 30, 2002, between the Company and the Loan Trustee. (8)(a) Participation Agreement (N3730B), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (8)(b) Indenture and Security Agreement (N3730B), dated as of April 30, 2002, between the Company and the Loan Trustee. (9)(a) Participation Agreement (N3764D), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (9)(b) Indenture and Security Agreement (N3764D), dated as of April 30, 2002, between the Company and the Loan Trustee. (10)(a) Participation Agreement (N3765), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (10)(b) Indenture and Security Agreement (N3765), dated as of April 30, 2002, between the Company and the Loan Trustee. (11)(a) Participation Agreement (N3766), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (11)(b) Indenture and Security Agreement (N3766), dated as of April 30, 2002, between the Company and the Loan Trustee. (12)(a) Participation Agreement (N3767), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (12)(b) Indenture and Security Agreement (N3767), dated as of April 30, 2002, between the Company and the Loan Trustee. (13)(a) Participation Agreement (N3768), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (13)(b) Indenture and Security Agreement (N3768), dated as of April 30, 2002, between the Company and the Loan Trustee. (14)(a) Participation Agreement (N3769L), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (14)(b) Indenture and Security Agreement (N3769L), dated as of April 30, 2002, between the Company and the Loan Trustee. (15)(a) Participation Agreement (N37700), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (15)(b) Indenture and Security Agreement (N37700), dated as of April 30, 2002, between the Company and the Loan Trustee. (16)(a) Participation Agreement (N3771K), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (16)(b) Indenture and Security Agreement (N3771K), dated as of April 30, 2002, between the Company and the Loan Trustee. The following documents relating to one Boeing 767-432ER aircraft bearing United States registration number N833MH (hereinafter collectively referred to as the "N833MH Documents") have been provided in this filing: (a) Participation Agreement (N833MH), dated as of April 30, 2002, among Delta Air Lines, Inc. (the "Company"), State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee under each of the Pass Through Trust Agreements (the "Pass Through Trustee"), State Street Bank and Trust Company of Connecticut, as Subordination Agent under the Intercreditor Agreement (the Subordination Agent"), State Street Bank and Trust Company of Connecticut, National Association, as loan trustee (the "Loan Trustee"), and State Street Bank and Trust Company of Connecticut, National Association, in its individual capacity as set forth therein ("State Street"); and (b) Indenture and Security Agreement (N833MH), dated as of April 30, 2002, between the Company and the Loan Trustee. The corresponding documents listed below are substantially identical in all material respects to the N833MH Documents, with the following exceptions: (1) conforming changes have been made to reflect the appropriate United States registration number of each aircraft (i.e., N67171, N185DN, N186DN, etc.), the appropriate model of each aircraft (i.e., 757-232, 767-332ER) and the appropriate manufacturer's serial number of each aircraft; (2) the description and original principal amount of the equipment notes set forth on Schedule I to each Participation Agreement differ; (2) the dollar amount set forth on Exhibit C to each Indenture and Security Agreement differs according to the model of each aircraft; (3) conforming changes have been made to reflect the appropriate engines relating to each aircraft (i.e., CFM International, Inc. CFM56-7B26, United Technologies Corporation PW2037, General Electric Company CF6-80C2B8F); and (4) the definitions set forth in Annex A to each Participation Agreement and Indenture and Security Agreement differ. (1)(a) Participation Agreement (N67171), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (1)(b) Indenture and Security Agreement (N67171), dated as of April 30, 2002, between the Company and the Loan Trustee. (2)(a) Participation Agreement (N185DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (2)(b) Indenture and Security Agreement (N185DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (3)(a) Participation Agreement (N186DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (3)(b) Indenture and Security Agreement (N186DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (4)(a) Participation Agreement (N187DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (4)(b) Indenture and Security Agreement (N187DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (5)(a) Participation Agreement (N188DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (5)(b) Indenture and Security Agreement (N188DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (6)(a) Participation Agreement (N189DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (6)(b) Indenture and Security Agreement (N189DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (7)(a) Participation Agreement (N190DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (7)(b) Indenture and Security Agreement (N190DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (8)(a) Participation Agreement (N191DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (8)(b) Indenture and Security Agreement (N191DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (9)(a) Participation Agreement (N192DN), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (9)(b) Indenture and Security Agreement (N192DN), dated as of April 30, 2002, between the Company and the Loan Trustee. (10)(a) Participation Agreement (N828MH), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (10)(b) Indenture and Security Agreement (N828MH), dated as of April 30, 2002, between the Company and the Loan Trustee. (11)(a) Participation Agreement (N829MH), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (11)(b) Indenture and Security Agreement (N829MH), dated as of April 30, 2002, between the Company and the Loan Trustee. (12)(a) Participation Agreement (N830MH), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (12)(b) Indenture and Security Agreement (N830MH), dated as of April 30, 2002, between the Company and the Loan Trustee. (13)(a) Participation Agreement (N831MH), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (13)(b) Indenture and Security Agreement (N831MH), dated as of April 30, 2002, between the Company and the Loan Trustee. (14)(a) Participation Agreement (N832MH), dated as of April 30, 2002, among the Company, the Pass Through Trustee, the Subordination Agent and State Street Bank and Trust Company of Connecticut, National Association, as loan trustee, and State Street Bank. (14)(b) Indenture and Security Agreement (N832MH), dated as of April 30, 2002, between the Company and the Loan Trustee. -----END PRIVACY-ENHANCED MESSAGE-----