-----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, KHSfKd0neBy1QNpZMthDJHtjFs3AMkSc6RNhmDY/cRoOizAP+EJjZOeRGnZTLNOt bxPx6qcw+NxPeBMGVzurBg== 0000950134-02-003238.txt : 20020415 0000950134-02-003238.hdr.sgml : 20020415 ACCESSION NUMBER: 0000950134-02-003238 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20020402 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20020403 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATLAS AIR WORLDWIDE HOLDINGS INC CENTRAL INDEX KEY: 0001135185 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 134146982 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-16545 FILM NUMBER: 02600587 BUSINESS ADDRESS: STREET 1: 2000 WESTCHESTER AVENUE CITY: PURCHASE STATE: NY ZIP: 10577-2543 BUSINESS PHONE: 9147018000 MAIL ADDRESS: STREET 1: 2000 WESTCHESTER AVENUE CITY: PURCHASE STATE: NY ZIP: 10577-2543 8-K 1 d95706e8-k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 2, 2002 Atlas Air Worldwide Holdings, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-25732 13-4146982 - -------------------------------------------------------------------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 2000 Westchester Avenue, Purchase, New York 10577 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code:(914) 701-8000 -------------- - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Atlas Air, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-25732 84-1207329 - -------------------------------------------------------------------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 2000 Westchester Avenue, Purchase, New York 10577 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code:(914) 701-8000 -------------- - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) This combined Form 8-K is separately filed by Atlas Air Worldwide Holdings, Inc. and Atlas Air, Inc. Information contained herein relating to any individual registrant is filed by such registrant on its behalf. No registrant makes any representation as to information relating to any other registrant. ITEM 5. OTHER EVENTS. (A) Atlas Air Worldwide Holdings, Inc. (the "Company") (NYSE: CGO) held its annual investor conference in New York, NY on April 2, 2002. At the conference, Doug Carty, the Company's chief financial officer provided the following guidance: o First quarter earnings expectations of a 15 cent per share loss and expectations of `modest profitability' for full-year 2002. o An expectation of a cash balance of approximately $260 million at the end of the fist quarter and approximately $275 million at year end 2002. o Anticipated Atlas Air block hour distribution for the first quarter and full-year 2002 as follows:
Q1 Full-Year 2002 2002 ---- --------- ACMI 59% 50% Charter 21% 18% Hub 15% 20% Dry Lease 5% 12%
o Anticipated block hours for Atlas and Polar for the first quarter and full-year 2002 as follows:
Q1 Full-Year 2002 2002 ---- --------- Atlas 23,176 112,944 Polar 9,338 33,736
A copy of the slide show presented at the conference, as well as a call-in number to hear a replay of the conference, are available on the Company's Website at www.atlasair.com/holdings. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (c) The following Exhibits are filed as part of this report:
EXHIBIT NO. DESCRIPTION 10.165 Form of Amendments One through Three to the Lease Agreements between Atlas Freighter Leasing III, Inc., as lessor, and Atlas Air, Inc., as lessee, relating to Boeing 747 aircraft, U.S. Registration Nos. N505MC, N509MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC and N534MC. 10.166 Form of Guaranty, dated as of October 30, 2001 by the Company in favor of Atlas Freighter Leasing III, Inc., as lessor, Bankers Trust Company, as administrative agent, and the Lenders who are party to a Credit Agreement dated as of April 25, 2000 for Atlas Air, Inc.'s obligations as lessee under Lease Agreements relating to Boeing 747 aircraft, U.S. Registration Nos. N505MC, N509MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC and N534MC.
2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ATLAS AIR WORLDWIDE HOLDINGS, INC. (Registrant) Dated: April 2, 2002 By: /s/ Douglas A. Carty ----------------------------------- Name: Douglas A. Carty Title: Senior Vice President and Chief Financial Officer ATLAS AIR, INC. (Registrant) Dated: April 2, 2002 By: /s/ Douglas A. Carty ----------------------------------- Name: Douglas A. Carty Title: Senior Vice President and Chief Financial Officer 3 EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION 10.165 Form of Amendments One through Three to the Lease Agreements between Atlas Freighter Leasing III, Inc., as lessor, and Atlas Air, Inc., as lessee, relating to Boeing 747 aircraft, U.S. Registration Nos. N505MC, N509MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC and N534MC. 10.166 Form of Guaranty, dated as of October 30, 2001 by the Company in favor of Atlas Freighter Leasing III, Inc., as lessor, Bankers Trust Company, as administrative agent, and the Lenders who are party to a Credit Agreement dated as of April 25, 2000 for Atlas Air, Inc.'s obligations as lessee under Lease Agreements relating to Boeing 747 aircraft, U.S. Registration Nos. N505MC, N509MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC and N534MC.
4 EX-10.165 3 d95706ex10-165.txt FORM OF AMENDMENTS TO LEASE AGREEMENTS EXHIBIT 10.165 [FORM OF AMENDMENT TO LEASE AGREEMENT] TO THE EXTENT, IF ANY, THAT THIS AMENDMENT 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 AMENDMENT MAY BE CREATED THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART OTHER THAN THE ORIGINAL EXECUTED COUNTERPART CONTAINING THE RECEIPT THEREFOR EXECUTED BY THE AGENT ON THE SIGNATURE PAGE HEREOF. AMENDMENT NO. 1 TO LEASE AGREEMENT AMENDMENT NO. 1 TO LEASE AGREEMENT (this "Amendment"), dated as of October 15, 2001, between ATLAS FREIGHTER LEASING III, INC., a Delaware corporation (the "Lessor"), and ATLAS AIR, INC., a Delaware corporation (the "Lessee"). All capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease Agreement. WITNESSETH: WHEREAS, the Lessor and the Lessee are parties to a Lease Agreement, dated as of April 25, 2000, and more particularly described on Schedule I hereto (as supplemented, the "Lease Agreement"); and WHEREAS, the parties hereto wish to amend the Lease Agreement as herein provided; NOW, THEREFORE, it is agreed: 1. Section 1 of the Lease Agreement is hereby amended by deleting the definition of "Cash Equivalents" in its entirety and inserting the following definition in lieu thereof: ""Cash Equivalents" means, as at any date of determination, (i) marketable securities (a) issued or directly and unconditionally guaranteed as to interest and principal by the United States Government or (b) issued by any agency of the United States the obligations of which are backed by the full faith and credit of the United States, in each case maturing within two years after the date of purchase; (ii) marketable direct obligations (fixed and/or floating rate) issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof, in each case maturing within two years after the date of purchase and having, at the time of the acquisition thereof and at all times thereafter, the highest rating obtainable from at least two of S&P, Moody's, and Fitch; (iii) Dollar-denominated marketable direct obligations (fixed and/or floating rate) issued by any corporation or commercial bank, including medium term notes and bonds, deposit notes and eurodollar/yankee notes and bonds, in each case maturing within two years after the date of purchase and, at the time of acquisition thereof and at all times thereafter, both (A) having a rating from at least two of S&P, Moody's, and Fitch and (B) not having a rating of less than A from S&P, A2 from Moody's, or A from Fitch; (iv) Dollar-denominated commercial paper maturing no more than two years from the date of purchase and issued by a corporation or commercial bank that, at the time of the acquisition of the commercial paper and at all times thereafter, both (A) has a short-term credit rating from at least two of S&P, Moody's, and Fitch and (B) does not have a short-term credit rating of less than A-1 (or the equivalent thereof) from S&P, P-1 (or the equivalent thereof) from Moody's, or F1 (or the equivalent thereof) from Fitch; (v) Dollar-denominated certificates of deposit, bankers' acceptances and/or time deposits maturing within two years after the date of purchase and issued or accepted by (a) any Lender or (b) any commercial bank that, at the time of acquisition of such security and at all times thereafter, both (A) has a short-term credit rating from at least two of S&P, Moody's, and Fitch and (B) does not have a short-term credit rating of less than A-1 (or the equivalent thereof) from S&P, P-1 (or the equivalent thereof) from Moody's, or F1 (or the equivalent thereof) from Fitch; (vi) shares of any money market mutual fund that (a) has at least 95% of its assets invested continuously in the types of investments referred to in clauses (i) and (ii) above, (b) has net assets of not less than $500,000,000, and (c) has the highest rating obtainable from either of S&P, Moody's, or Fitch; (vii) Dollar-denominated asset-backed securities (excluding any mortgage products) with a stated bullet maturity of no more than two years from the date of purchase and, at the time of acquisition thereof and at all times thereafter, both (A) having a rating from at least two of S&P, Moody's, and Fitch and (B) not having a rating of less than A from S&P, A2 from Moody's, or A from Fitch; (viii) repurchase agreements entered into with financial institutions satisfying the criteria set forth in clause (v) above with terms of not more than thirty days for securities described in clauses (i) and (ii) above and having a fair market value of at least 102% of the amount of the repurchase obligations; and (ix) auction rate securities (auction rate debt and money market preferreds) with terms of not more than ninety days and, at the time of acquisition thereof and at all times thereafter, both (A) having a rating from at least two of S&P, Moody's, and Fitch and (B) not having a rating of less than A from S&P, A2 from Moody's, or A from Fitch.". 2. Section 1 of the Lease Agreement is hereby further amended by deleting the definition of "Pricing Certificate" therefrom in its entirety. 3. Section 1 of the Lease Agreement is hereby further amended by deleting the definition of "S&P" in its entirety and inserting the following definition in lieu thereof: ""S&P" means Standard & Poor's, a division of the McGraw-Hill Companies, Inc.". 2 4. Section 1 of the Lease Agreement is hereby further amended by inserting the following definitions in the appropriate alphabetical order: ""FITCH" means Fitch, Inc." ""INTERIM PERIOD" has the meaning assigned to that term in Section 1.1 of the Credit Agreement (as amended).". ""UNRESTRICTED CASH AND CASH EQUIVALENTS" means Cash and Cash Equivalents that are not subject to any Lien or any other restriction or limitation on the Lessee's ability to withdraw (in the case of Cash) or sell (in the case of Cash Equivalents).". 5. Section 6(a) of the Lease Agreement is hereby amended by deleting clause (13) therefrom in its entirety and inserting the text "(13) Intentionally Omitted;" in lieu thereof. 6. Section 7(c)(i) of the Lease Agreement is hereby amended by adding the following text at the end thereof: "provided, that (x) the weighted average maturity of all Investments in Cash Equivalents shall not exceed twelve months, (y) no more than 10% of the Lessee's Investments in Cash Equivalents shall be in a single security or issuer (other than U.S. treasuries, U.S. government agency obligations and money market funds), and (z) no more than 50% of the Lessee's Investments in Cash Equivalents shall be in a single U.S. treasury or U.S. government agency security;". 7. Section 7(c)(iv) of the Lease Agreement is hereby amended by inserting the text, "at any time other than during the Interim Period," immediately before the text "the Lessee may". 8. Sections 7(e)(2), 7(e)(4), and 7(e)(6) of the Lease Agreement are hereby amended by inserting the text "at any time other than during the Interim Period," immediately before the text "the Lessee may" in each such clause. 9. Section 7(f) of the Lease Agreement is hereby amended by adding the following new clause (iv): "(iv) MINIMUM LIQUIDITY. The Lessee shall not permit its reserve of Unrestricted Cash and Cash Equivalents to be less than $200,000,000 at any time.". 10. Section 7(g)(5) of the Lease Agreement is hereby amended by inserting the text, "at any time other than during the Interim Period," immediately before the text "the Lessee may". 3 11. Section 7(g)(9) of the Lease Agreement is hereby amended by deleting the text "to Colorado" and inserting the text "from Colorado to New York" in lieu thereof. 12. Attachment No. 1 to Exhibit D to the Lease Agreement is hereby amended by inserting the following text immediately before the text "J. Fundamental Changes": "J. MINIMUM LIQUIDITY (as of ______________, 200__) 1. Unrestricted Cash and Cash Equivalents: $ 2. Minimum required under subsection 7(f)(iv): $200,000,000" 13. Attachment No. 1 to Exhibit D to the Lease Agreement is hereby further amended by renumbering items "J.", "K.", and "L." as "K.", "L.", and "M.", respectively. 14. This Amendment shall become effective on the date (the "Lease Amendment Effective Date") when (i) the Lessor and the Requisite Lenders (as defined in the Credit Agreement) have signed a counterpart (whether the same or different counterparts) to that certain First Amendment, Consent and Waiver to Credit Agreement (the "Credit Agreement Amendment"), dated as of the date hereof, among the Lessor, the Lenders (as defined in such Credit Agreement Amendment) and the Agent, and have delivered (including by way of facsimile) the same to the Agent, (ii) the Lessor, the Lessee and the Agent have signed a counterpart hereof (whether the same or different counterparts) and have delivered (including by way of facsimile) the same to the Agent, (iii) the fees required by Section 13 of the Credit Agreement Amendment have been paid and (iv) all other fees, costs, and expenses owing to the Agent or the Lenders, including, without limitation, the fees of White & Case LLP, have been paid. 15. In order to induce the Lessor and the Agent to enter into this Amendment, and in order to induce the Agent and the Lenders (as defined in the Credit Agreement Amendment) to enter into the Credit Agreement Amendment, the Lessee hereby represents and warrants to the Lessor, the Agent and each Lender that on the Lease Amendment Effective Date, (i) no Event of Default or Potential Event of Default under the Credit Agreement exists and is continuing (other than as waived by the Credit Agreement Amendment) or will exist and be continuing (other than as waived by the Credit Agreement Amendment) after giving effect to this Amendment, (ii) no Default or Lease Event of Default under any Lease exists and is continuing (other than as waived by the Credit Agreement Amendment) or will exist and be continuing (other than as waived by the Credit Agreement Amendment) after giving effect to this Amendment and (iii) all of the representations and warranties contained in the Loan Documents shall be true and correct in all material respects, with the same effect as though such representations and warranties had been made on and as of the Lease Amendment Effective Date (it being understood that any representation or warranty made as of a specific date shall be true and correct in all material respects as of such specified date). 16. This Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed 4 and delivered shall be an original, but all of which shall together constitute one and the same instrument. 17. THIS AMENDMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES. 18. This Amendment is limited precisely as written and shall not be deemed to be an amendment, consent, waiver or modification of any other term or condition of the Lease Agreement, any other Loan Document or any of the instruments or agreements referred to therein, or prejudice any other right or rights that the Lessor, the Agent, the Lenders or any of them may now have or may have in the future under or in connection with the Lease Agreement, any other Loan Document or any of the instruments or agreements referred to therein. Except as expressly modified hereby, the terms and provisions of the Lease Agreement shall continue in full force and effect. From and after the Lease Amendment Effective Date all references in the Lease Agreement and the other Loan Documents to the Lease Agreement shall be deemed to be references to the Lease Agreement as modified hereby. **** 5 IN WITNESS WHEREOF, the Lessor and the Lessee have each caused this Amendment to be duly executed as of the day and year first above written. ATLAS FREIGHTER LEASING III, INC., Lessor By: ---------------------------------------------- Name: Fred L. deLeeuw Title: Vice President and Assistant Secretary ATLAS AIR, INC., Lessee By: ---------------------------------------------- Name: Douglas A. Carty Title: Senior Vice President and Chief Financial Officer Receipt of this original counterpart of this Amendment is hereby acknowledged this _____ day of October, 2001. BANKERS TRUST COMPANY, as Agent By: ---------------------------------------------- Name: Title: 6 SCHEDULE I Lease Agreement, dated as of April 25, 2000, between the Lessor and the Lessee, as supplemented by Lease Supplement No. 1, dated as of April 25, 2000, which were recorded together as one instrument by the Federal Aviation Administration (the "FAA") on [May 24], 2000, as Conveyance No. [__________] [, and as further supplemented by Lease Supplement No. 2, dated as of _________, 2000, which was recorded by the FAA on __________, 20___, as Conveyance No. __________]. EXHIBIT A [FORM OF AMENDMENT TO LEASE AGREEMENT] TO THE EXTENT, IF ANY, THAT THIS AMENDMENT 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 AMENDMENT MAY BE CREATED THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART OTHER THAN THE ORIGINAL EXECUTED COUNTERPART CONTAINING THE RECEIPT THEREFOR EXECUTED BY THE AGENT ON THE SIGNATURE PAGE HEREOF. AMENDMENT NO. 2 TO LEASE AGREEMENT AMENDMENT NO. 2 TO LEASE AGREEMENT (this "Amendment"), dated as of October 30, 2001, between ATLAS FREIGHTER LEASING III, INC., a Delaware corporation (the "Lessor"), and ATLAS AIR, INC., a Delaware corporation (the "Lessee"). All capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease Agreement. WITNESSETH: WHEREAS, the Lessor and the Lessee are parties to a Lease Agreement, dated as of April 25, 2000, and more particularly described on Schedule I hereto (as amended, modified, or supplemented through the date hereof, the "Lease Agreement"); and WHEREAS, the parties hereto wish to amend the Lease Agreement as herein provided; NOW, THEREFORE, it is agreed: 1. Section 1 of the Lease Agreement is hereby amended by inserting the following definitions in the appropriate alphabetical order: ""FISCAL YEAR" means the fiscal year of the Lessee." ""GE CAPITAL LOANS" means the loans to be made pursuant to the credit agreement, in form and substance satisfactory to the Agent, entered into or to be entered into between Holdings and General Electric Capital Corporation in connection with the Polar Air Transaction." ""HOLDINGS" means Atlas Air Worldwide Holdings, Inc., a Delaware corporation." ""HOLDINGS GUARANTY" means each Guaranty, dated as of October 30, 2001, given by Holdings to and for the benefit of the Lessor, the Agent, and the Lenders, or any such Guaranty, as the context implies." ""POLAR AIR" means Polar Air Cargo, Inc., a California corporation, which will be an indirect wholly owned subsidiary of Holdings subsequent to the completion of the Polar Air Transaction.". ""POLAR AIR PAYMENT" has the meaning assigned to that term in Section 7(e)(2).". ""POLAR AIR TRANSACTION" has the meaning assigned to that term in Section 7(e)(2).". 2. Section 1 of the Lease Agreement is hereby further amended by inserting the text "the Holdings Guaranties," immediately following the text "the Leases," in the definition of "Loan Documents." 3. Section 7(c) of the Lease Agreement is hereby amended by deleting clause (iv) therefrom and inserting the following text in lieu thereof: "(iv) so long as no Default or Lease Event of Default has occurred and is continuing or would result therefrom, and so long as, on a Pro Forma Basis, the Lessee will be in compliance with the covenant set forth in Section 7(f)(iv), the Lessee may make Investments in Joint Ventures in an aggregate amount not to exceed (A) $15 million less (B) the aggregate amount contributed to capital of Special Purpose Subsidiaries during the period commencing January 1, 2000, and ending on the last day of the Fiscal Year immediately preceding the date of determination (taken as a single accounting period); provided, that the Lessee shall not incur liabilities related to any such Joint Venture in excess of the Lessee's Investment therein;". 4. Section 7(c)(vi) of the Lease Agreement is hereby amended by inserting the text "so long as no Default or Lease Event of Default has occurred and is continuing or would result therefrom, and so long as, on a Pro Forma Basis, the Lessee will be in compliance with the covenant set forth in Section 7(f)(iv)," immediately before the text "the Lessee and its Subsidiaries may". 5. Section 7(c) of the Lease Agreement is hereby further amended by inserting the following new paragraph at the end thereof: "Notwithstanding the foregoing, neither the Lessee nor its Subsidiaries may make any direct or indirect loan or advance to a Holding Company, except an Investment made in accordance with Section 7(c)(vi) to the extent such Investment is for the purpose of making mandatory principal and interest payments on the GE Capital Loans." 2 6. Section 7(e) of the Lease Agreement is hereby amended by inserting the text ", and so long as, on a Pro Forma Basis, the Lessee will be in compliance with the covenant set forth in Section 7(f)(iv)" immediately before the text ":". 7. Section 7(e) of the Lease Agreement is hereby further amended by deleting clause (2) therefrom and inserting the following text in lieu thereof: "(2) the Lessee may make a one-time Restricted Junior Payment to Holdings in an amount not to exceed $37 million (the "Polar Air Payment"), of which $30 million is to be used by Holdings to fund its acquisition of Polar Air (the "Polar Air Transaction") and $7 million is to be used by Holdings to make mandatory principal and interest payments required under the GE Capital Loans; provided, that, prior to making the Polar Air Payment, the Lessee shall have provided to the Agent an executed copy of the credit agreement pursuant to which the GE Capital Loans will be made, which credit agreement shall be in form and substance satisfactory to the Agent; provided further, that, if the Lessee elects to make the Polar Air Payment, such Polar Air Payment must be made on or prior to November 7, 2001; provided further, that if the Polar Air Payment is funded and, for any reason, the closing of the Polar Air Transaction does not occur on or before November 7, 2001, the Lessee shall cause Holdings to refund the Polar Air Payment to the Lessee immediately;". 8. Section 7(e)(4) of the Lease Agreement is hereby amended by deleting the text, "$15 million" in each place where it occurs and by inserting the text "$5 million" in lieu thereof. 9. Section 16(c) of the Lease Agreement is hereby amended by inserting the text "or Holdings" immediately following the text "the Lessee". 10. Section 16(d) of the Lease Agreement is hereby amended by inserting the text "or Holdings" immediately following the text "the Lessee". 11. Section 16(n) of the Lease Agreement is hereby amended by deleting the text "to own directly or indirectly 100% of the outstanding Securities of the Lessee" and inserting the text "to have direct beneficial ownership and control of 100% of the outstanding capital stock of the Lessee, as well as any Securities of the Lessee (other than capital stock) entitled to vote in the election of directors, or if, at any time, the Holding Company grants a Lien with respect to the capital stock of the Lessee" in lieu thereof. 12. This Amendment shall become effective on the date (the "Lease Amendment Effective Date") when (i) the Lessor and the Requisite Lenders (as defined in the Credit Agreement) have signed a counterpart (whether the same or different counterparts) to that certain Amendment No. 2 and Consent No. 4 to Credit Agreement (the "Consent"), dated as of the date hereof, among the Lessor, the Lenders (as defined in such Consent) and the Agent, and have delivered (including by way of facsimile) the same to the Agent, (ii) the Lessor, the Lessee and the Agent have signed a counterpart hereof (whether the same or different counterparts) and 3 have delivered (including by way of facsimile) the same to the Agent, (iii) Holdings has signed a counterpart to the Holdings Guaranty that relates to the Lease Agreement and has delivered (including by way of facsimile) the same to the Agent, (iv) the Lessor and the Agent have signed a counterpart (whether the same or different counterparts) to that certain Amendment No. 1 to Security Agreement and Chattel Mortgage, dated as of the date hereof, among the Lessor and the Agent, that relates to the Lease Agreement and the property leased thereunder, and have delivered (including by way of facsimile) the same to the Agent, (v) the fees required by Section 6 of the Consent have been paid and (vi) all other fees, costs, and expenses owing to the Agent or the Lenders, including, without limitation, the fees of White & Case LLP, have been paid. 13. In order to induce the Lessor and the Agent to enter into this Amendment, and in order to induce the Agent and the Lenders (as defined in the Consent) to enter into the Consent, the Lessee hereby represents and warrants to the Lessor, the Agent and each Lender that on the Lease Amendment Effective Date, (i) no Event of Default or Potential Event of Default under the Credit Agreement shall exist and be continuing after giving effect to this Amendment, (ii) no Default or Lease Event of Default under any Lease shall exist and be continuing after giving effect to this Amendment and (iii) all of the representations and warranties contained in the Loan Documents shall be true and correct in all material respects, with the same effect as though such representations and warranties had been made on and as of the Lease Amendment Effective Date (it being understood that any representation or warranty made as of a specific date shall be true and correct in all material respects as of such specified date). 14. This Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. 15. THIS AMENDMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES. 16. This Amendment is limited precisely as written and shall not be deemed to be an amendment, consent, waiver or modification of any other term or condition of the Lease Agreement, any other Loan Document or any of the instruments or agreements referred to therein, or prejudice any other right or rights that the Lessor, the Agent, the Lenders or any of them may now have or may have in the future under or in connection with the Lease Agreement, any other Loan Document or any of the instruments or agreements referred to therein. Except as expressly modified hereby, the terms and provisions of the Lease Agreement shall continue in full force and effect. From and after the Lease Amendment Effective Date all references in the Lease Agreement and the other Loan Documents to the Lease Agreement shall be deemed to be references to the Lease Agreement as modified hereby. **** 4 IN WITNESS WHEREOF, the Lessor and the Lessee have each caused this Amendment to be duly executed as of the day and year first above written. ATLAS FREIGHTER LEASING III, INC., Lessor By: ------------------------------------- Name: Title: ATLAS AIR, INC., Lessee By: ------------------------------------- Name: Title: Receipt of this original counterpart of this Amendment is hereby acknowledged this _____ day of October, 2001. BANKERS TRUST COMPANY, as Agent By: ------------------------------------- Name: Title: SCHEDULE I Lease Agreement, dated as of April 25, 2000, between the Lessor and the Lessee, as supplemented by Lease Supplement No. 1, dated as of April 25, 2000, which were recorded together as one instrument by the Federal Aviation Administration (the "FAA") on [May 24], 2000, as Conveyance No. [__________] [, and as further supplemented by Lease Supplement No. 2, dated as of _________, 2000, which was recorded by the FAA on __________, 20___, as Conveyance No. __________], and as amended by Amendment No. 1 to Lease Agreement, dated as of October 15, 2001. EXHIBIT A [FORM OF AMENDMENT TO LEASE AGREEMENT] TO THE EXTENT, IF ANY, THAT THIS AMENDMENT 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 AMENDMENT MAY BE CREATED THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART OTHER THAN THE ORIGINAL EXECUTED COUNTERPART CONTAINING THE RECEIPT THEREFOR EXECUTED BY THE AGENT ON THE SIGNATURE PAGE HEREOF. AMENDMENT NO. 3 TO LEASE AGREEMENT AMENDMENT NO. 3 TO LEASE AGREEMENT (this "Amendment"), dated as of December 14, 2001, between ATLAS FREIGHTER LEASING III, INC., a Delaware corporation (the "Lessor"), and ATLAS AIR, INC., a Delaware corporation (the "Lessee"). All capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease Agreement. WITNESSETH: WHEREAS, the Lessor and the Lessee are parties to a Lease Agreement, dated as of April 25, 2000, and more particularly described on Schedule I hereto (as supplemented, the "Lease Agreement"); and WHEREAS, the parties hereto wish to amend the Lease Agreement as herein provided; NOW, THEREFORE, it is agreed: 1. Section 7(f)(i) of the Lease Agreement is hereby amended by deleting the table therefrom and inserting the following table in lieu thereof:
FISCAL QUARTER MINIMUM INTEREST ENDING COVERAGE RATIO -------------- ---------------- March 31, 2000 2.10:1.00 June 30, 2000 2.10:1.00 September 30, 2000 2.20:1.00 December 31, 2000 2.20:1.00
FISCAL QUARTER MINIMUM INTEREST ENDING COVERAGE RATIO -------------- ---------------- March 31, 2001 2.40:1.00 June 30, 2001 2.40:1.00 September 30, 2001 2.50:1.00 December 31, 2001 1.90:1.00 March 31, 2002 1.70:1.00 June 30, 2002 1.75:1.00 September 30, 2002 1.75:1.00 December 31, 2002 1.75:1.00 March 31, 2003 2.50:1.00 June 30, 2003 2.75:1.00 September 30, 2003 2.75:1.00 December 31, 2003 2.75:1.00 March 31, 2004 2.75:1.00 June 30, 2004 2.75:1.00 September 30, 2004 2.75:1.00 December 31, 2004 2.75:1.00 March 31, 2005 2.75:1.00 June 30, 2005 2.75:1.00 September 30, 2005 2.75:1.00 December 31, 2005 2.75:1.00 March 31, 2006 2.75:1.00 June 30, 2006 2.75:1.00 September 30, 2006 2.75:1.00 December 31, 2006 2.75:1.00
2 2. Section 7(f)(ii) of the Lease Agreement is hereby amended by deleting the table therefrom and inserting the following table in lieu thereof:
FISCAL QUARTER MAXIMUM ENDING LEVERAGE RATIO -------------- -------------- March 31, 2000 4.75:1.00 June 30, 2000 4.75:1.00 September 30, 2000 4.75:1.00 December 31, 2000 4.75:1.00 March 31, 2001 4.75:1.00 June 30, 2001 4.50:1.00 September 30, 2001 4.50:1.00 December 31, 2001 6.25:1.00 March 31, 2002 6.70:1.00 June 30, 2002 6.40:1.00 September 30, 2002 6.40:1.00 December 31, 2002 6.40:1.00 March 31, 2003 4.25:1.00 June 30, 2003 4.25:1.00 September 30, 2003 4.25:1.00 December 31, 2003 4.00:1.00
3
FISCAL QUARTER MAXIMUM ENDING LEVERAGE RATIO -------------- -------------- March 31, 2004 4.00:1.00 June 30, 2004 4.00:1.00 September 30, 2004 4.00:1.00 December 31, 2004 3.75:1.00 March 31, 2005 3.75:1.00 June 30, 2005 3.75:1.00 September 30, 2005 3.75:1.00 December 31, 2005 3.50:1.00 March 31, 2006 3.50:1.00 June 30, 2006 3.50:1.00 September 30, 2006 3.50:1.00 December 31, 2006 3.50:1.00
3. The Lease Agreement is hereby amended by deleting Exhibit B thereto in its entirety and replacing it with Annex A attached hereto. 4. The Lease Agreement is hereby amended by deleting Exhibit C thereto in its entirety and replacing it with Annex B attached hereto. 5. On or prior to the Lease Amendment Effective Date (as defined below), the Lessee shall make a prepayment of Basic Rent in the amount set forth on Schedule II hereto, which prepayment shall offset the immediately succeeding payments of Basic Rent required pursuant to Section 3(a) of the Lease Agreement. 6. This Amendment shall become effective on the date (the "Lease Amendment Effective Date") when (i) the Lessor and the holders of a majority of principal of each of the Tranche A Loans (as defined in the Credit Agreement) and Tranche B Loans (as defined in the Credit Agreement) have signed a counterpart (whether the same or different counterparts) to that certain Consent No. 5 and Waiver No. 3 to Credit Agreement (the "Consent"), dated as of the date hereof, among the Lessor, the Lenders (as defined in such Consent) and the Agent, and have delivered (including by way of facsimile) the same to the Agent, (ii) the Lessor, the Lessee, and the Agent have signed a counterpart hereof (whether the 4 same or different counterparts) and have delivered (including by way of facsimile) the same to the Agent, (iii) the payments required by Sections 4 and 6 of the Consent have been paid, and (iv) all other fees, costs, and expenses owing to the Agent or the Lenders, including, without limitation, the fees of White & Case LLP, have been paid. 7. In order to induce the Lessor and the Agent to enter into this Amendment, and in order to induce the Agent and the Lenders (as defined in the Consent) to enter into the Consent, the Lessee hereby represents and warrants to the Lessor, the Agent, and each Lender that on the Lease Amendment Effective Date, (i) no Event of Default or Potential Event of Default under the Credit Agreement exists and is continuing (other than as waived by the Consent) or will exist and be continuing (other than as waived by the Consent) after giving effect to this Amendment, (ii) no Default or Lease Event of Default under any Lease exists and is continuing (other than as waived by the Consent) or will exist and be continuing (other than as waived by the Consent) after giving effect to this Amendment, and (iii) all of the representations and warranties contained in the Loan Documents shall be true and correct in all material respects, with the same effect as though such representations and warranties had been made on and as of the Lease Amendment Effective Date (it being understood that any representation or warranty made as of a specific date shall be true and correct in all material respects as of such specified date). 8. This Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. 9. THIS AMENDMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES. 10. This Amendment is limited precisely as written and shall not be deemed to be an amendment, consent, waiver, or modification of any other term or condition of the Lease Agreement, any other Loan Document, or any of the instruments or agreements referred to therein, or prejudice any other right or rights that the Lessor, the Agent, the Lenders, or any of them may now have or may have in the future under or in connection with the Lease Agreement, any other Loan Document, or any of the instruments or agreements referred to therein. Except as expressly modified hereby, the terms and provisions of the Lease Agreement shall continue in full force and effect. From and after the Lease Amendment Effective Date, all references in the Lease Agreement and the other Loan Documents to the Lease Agreement shall be deemed to be references to the Lease Agreement as modified hereby. ***** 5 IN WITNESS WHEREOF, the Lessor and the Lessee have each caused this Amendment to be duly executed as of the day and year first written above. ATLAS FREIGHTER LEASING III, INC., Lessor By: ---------------------------------- Name: Title: ATLAS AIR, INC., Lessee By: ---------------------------------- Name: Title: Receipt of this original counterpart of this Amendment is hereby acknowledged this _____ day of December, 2001. BANKERS TRUST COMPANY, as Agent By: ---------------------------------- Name: Title: 6 SCHEDULE I Lease Agreement, dated as of April 25, 2000, between the Lessor and the Lessee, as supplemented by Lease Supplement No. 1, dated as of April 25, 2000, which were recorded together as one instrument by the Federal Aviation Administration (the "FAA") on [May 24], 2000, as Conveyance No. __________ [, and as further supplemented by Lease Supplement No. 2, dated as of November 13, 2000, which was recorded by the FAA on December ___, 2000, as Conveyance No. __________], and as amended by Amendment No. 1 to Lease Agreement, dated as of October 15, 2001, which was recorded by the FAA on ___________, 20___, as Conveyance No. __________, and as further amended by Amendment No. 2 to Lease Agreement, dated as of October 30, 2001, which was recorded by the FAA on ___________, 20___, as Conveyance No. __________. SCHEDULE II $[__________](1) - -------- (1) The Agent shall provide a Schedule II for each Lease Amendment. The amount set forth on Schedule II for each Lease Amendment shall be an amount equal to the product obtained by multiplying (i) the total prepayment required by the Consent by (ii) a fraction, the numerator of which is the Maximum Loan Amount for the Aircraft or Spare Engine Pool leased pursuant to the Lease Agreement corresponding to such Lease Amendment, and the denominator of which is the sum of the Maximum Loan Amounts for all Aircraft or Spare Engine Pools currently leased under the Leases. ANNEX A SCHEDULE B to Lease Agreement BASIC RENT(2)
Cash Accrued Payment Deferral Interest Date Basic Rent of Basic Rent of Basic Rent on Deferral ---- ---------- ------------- ------------- -----------
Total - ---------- 2 The Agent shall prepare an Exhibit B for each Lease. ANNEX B SCHEDULE C to Lease Agreement STIPULATED LOSS VALUES(3)
Stipulated Loss Stipulated Determination Date Loss Value ------------------ ----------
- ---------- 3 The Agent shall prepare an Exhibit C for each Lease. EX-10.166 4 d95706ex10-166.txt FORM OF GUARANTY EXHIBIT 10.166 [FORM OF GUARANTY] ================================================================================ GUARANTY ([N5___MC]) Dated as of October 30, 2001 given by ATLAS AIR WORLDWIDE HOLDINGS, INC. ================================================================================ TABLE OF CONTENTS
Page ---- SECTION 1. GUARANTY..............................................................................................1 SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY...........................................................2 SECTION 3. COVENANTS OF GUARANTOR................................................................................6 (a) No Assignment by Guarantor..........................................................................6 (b) Default Under Loan Documents........................................................................6 (c) Financial Statements and Reports....................................................................6 (d) Inspection..........................................................................................7 (e) GE Capital Loans....................................................................................7 SECTION 4. REPRESENTATIONS AND WARRANTIES OF GUARANTOR...........................................................7 SECTION 5. MISCELLANEOUS.........................................................................................7 (a) Waivers; Cumulative Effect..........................................................................7 (b) Amendments; Waivers.................................................................................8 (c) Severability........................................................................................8 (d) Counterparts........................................................................................8 (e) Notices.............................................................................................8 (f) Headings, References................................................................................8 (g) Governing Law.......................................................................................8 (h) Benefit and Binding Effect..........................................................................8 (i) Service of Process; Jurisdiction and Waiver.........................................................8 Annex A - Address for Notices to Guarantor Schedule I - Description of Lease Agreement
(i) GUARANTY GUARANTY (this "Guaranty") dated as of October 30, 2001, is given by Atlas Air Worldwide Holdings, Inc. (the "Guarantor"), a Delaware corporation, with respect to each and every obligation of the Lessee under the Lease Agreement, dated as of April 25, 2000, and more particularly described on Schedule I hereto (as amended and supplemented through the date hereof, and as amended, modified, or supplemented from time to time hereafter, the "Lease Agreement") and the other Loan Documents, and is given to and for the benefit of the Lessor, the Agent, and the Lenders (collectively, the "Guaranteed Beneficiaries" and individually, a "Guaranteed Beneficiary"). All capitalized terms used herein shall, unless otherwise defined herein, have the respective meanings set forth in the Lease Agreement. WITNESSETH: WHEREAS, as of the date hereof the Guarantor owns 100% of the issued and outstanding capital stock of the Lessee; WHEREAS, it is a condition precedent to the effectiveness of that certain Amendment No. 2 to Lease Agreement (the "Lease Amendment"), dated as of the date hereof, between the Lessor and the Lessee, that the Guarantor guarantee the obligations of the Lessee under the Lease Agreement and the other Loan Documents in favor of the Guaranteed Beneficiaries; WHEREAS, it is a condition precedent to the effectiveness of that certain Consent No. 4 to Credit Agreement (the "Consent"), dated as of the date hereof, among the Lessor (in its capacity as Borrower under the Credit Agreement), the lenders party thereto, and the Agent, that the Guarantor guarantee the obligations of the Lessee under the Lease Agreement and the other Loan Documents in favor of the Guaranteed Beneficiaries; WHEREAS, the Guarantor is entering into this Guaranty in order to induce the Lessor to enter into the Lease Amendment and to enter into a similar amendment to each Lease other than the Lease Agreement; and WHEREAS, the Guarantor is entering into this Guaranty in order to induce the Agent and each Lender to enter into the Consent; NOW, THEREFORE, the Guarantor hereby agrees on behalf of and for the benefit of the Guaranteed Beneficiaries as follows: SECTION 1. GUARANTY. The Guarantor does hereby unconditionally and irrevocably guarantee, as primary obligor and not merely as surety, the following (such obligations being the "Guaranteed Obligations"): (a) to each Guaranteed Beneficiary, the full and prompt payment when, where and as due, of each and every payment obligation of the Lessee to each such Guaranteed Beneficiary under the Lease Agreement and each other Loan Document, including, without limitation, Rent; and (b) to each Guaranteed Beneficiary entitled thereto under the terms of any Loan Document, the full and timely performance and observance by the Lessee of each and all other covenants and agreements not described in clause (a) above required to be performed or observed by the Lessee under such Loan Document. Without limiting the generality of the foregoing, the Guarantor's liability hereunder shall extend to all obligations that constitute part of the Guaranteed Obligations and would be owed by the Lessee under the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, suspension of payments, reorganization or similar proceeding involving the Lessee. SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY. (a) Each and every default in any payment or performance of any obligation of the Lessee under any Loan Document to which the Lessee is a party shall give rise to a separate claim and cause of action hereunder to the extent that each such default by the Lessee would give rise to a separate claim or cause of action under the applicable Loan Document, and separate claims or suits may be made and brought, as the case may be, hereunder as each such default occurs. (b) This Guaranty shall be a continuing, absolute, irrevocable and unconditional guaranty of payment and performance and not of collection and shall remain in full force and effect until each and all of the obligations of the Lessee guaranteed hereunder shall have been fully and indefeasibly discharged or performed in accordance with the terms and provisions of the Loan Documents (and no longer subject to recoupment, preference claims or clawback under applicable bankruptcy, insolvency or similar laws), and the Guarantor shall have fully discharged or performed all of its obligations under this Guaranty to each Guaranteed Beneficiary. (c) This Guaranty and the liability of the Guarantor provided for in Section 1 hereunder shall remain in full force and effect irrespective of: (i) the legality, validity, regularity or enforceability, or the absence of any thereof, of any Loan Document (or other document or agreement) or of any assignment, amendment, modification, or termination of any Loan Document (or other document or agreement) or any subleasing or further subleasing of the Aircraft or Spare Engines (or any interest therein or portion thereof), and shall in no way be affected or impaired by (and no notice to the Guarantor shall be required in respect of) any compromise, waiver, settlement, release, renewal, extension, indulgence, amendment, addition, deletion, change or modification with respect to, or release of any security for any of the obligations or liabilities of the Lessee under, any Loan Document or any redelivery, repossession, sale, transfer or other disposition, surrender or destruction of, or other event 2 or circumstance with respect to, the Aircraft or Spare Engines (or any interest therein or portion thereof), in whole or part; or (ii) the transfer, assignment, subletting, or mortgaging, or the purported transfer, assignment, subletting, or mortgaging, of all or any part of the interest of any Guaranteed Beneficiary or the Lessee in the Aircraft or Spare Engines (or any interest therein or portion thereof) in accordance with the Loan Documents; or (iii) any absence or defect or failure of title or lack of recordation or registration with respect to any Guaranteed Beneficiary's or the Lessee's interest in the Aircraft or Spare Engines (or any interest therein or portion thereof); or (iv) any failure of delivery of, or loss of perfection of any security interest with respect to, any portion of the Aircraft or Spare Engines (or any interest therein or portion thereof); or (v) any matter relating to any agreement or approval (or the absence thereof) in connection with the Aircraft or Spare Engines (or any interest therein or portion thereof); or (vi) any failure, neglect or omission on the part of any Guaranteed Beneficiary or any other Person to give the Guarantor notice of the occurrence of any Default or Lease Event of Default or Potential Event of Default or Event of Default or to realize upon any collateral held by any Guaranteed Beneficiary or any other Person with respect to any obligations or liabilities of the Lessee, or to provide for any insurance on the Aircraft or Spare Engines (or any interest therein or portion thereof), or to establish or maintain a security or other interest in the Aircraft or Spare Engines (or any interest therein or portion thereof) or any collateral provided under any Loan Document or to establish or maintain the priority or perfection of any thereof; or (vii) any defect in the compliance with specifications, warranties or any insurance policy or the condition, design, operation or fitness for use of, or any damage to or loss or destruction of, or any interruption or cessation in the use of, the Aircraft or Spare Engines (or any interest therein or any portion thereof) by the Lessee or any other Person for any reason whatsoever (including, without limitation, any governmental prohibition or restriction, condemnation, requisition, seizure or any other act on the part of any governmental or military authority, or any act of God or of the public enemy) regardless of the duration thereof (even though such duration would otherwise constitute a frustration under any Loan Document), whether or not without fault on the part of the Lessee or any other Person; or (viii) any merger, consolidation or other restructuring or termination of the corporate structure, reorganization or transaction with respect to the Lessee or the Guarantor into, with or in respect of, any other Person or any sale, lease, assignment or transfer of any of the assets of the Lessee or Guarantor to any other Person; or 3 (ix) any disposition by the Guarantor of its interest in the Lessee, or any change in the ownership of any shares of capital stock of the Guarantor or the Lessee, or any change, restructuring or termination of the corporate structure or existence of the Lessee; or (x) the imposition of any Tax or other charge against the Lessee, the Guarantor or any other Person; or (xi) any exchange, release or nonperfection, or lapse of perfection, of any security for any Guaranteed Obligation or the acceptance of any security therefor; or (xii) any bankruptcy, insolvency, winding up, dissolution, liquidation, receivership, or reorganization of, or similar proceedings affecting, the Lessee or the Guarantor or its assets or any resulting release or discharge of any of the Guaranteed Obligations (except to the extent resulting from performance thereof); or (xiii) any regulatory change or other governmental action (whether or not adverse); or (xiv) any partial payment or performance of the Guaranteed Obligations (whether as a result of the exercise of any right, remedy, power or privilege or otherwise) that is accepted or received (except, subject to paragraph (f) of this Section 2, to the extent of such payment or performance); or (xv) any other occurrence or circumstance whatsoever, whether similar or dissimilar to the foregoing, whether or not foreseeable, that might otherwise constitute a legal or equitable defense or discharge of the liabilities of a guarantor or surety or that might otherwise limit recourse against the Guarantor. The obligations of the Guarantor set forth herein constitute the full recourse obligations of the Guarantor enforceable against it to the full extent of all its assets and properties. (d) The obligation and liability of the Guarantor hereunder shall not be impaired, diminished, abated or otherwise affected (i) by any set-off, defense or counterclaim that the Lessee, the Guarantor or any other Person may have or claim to have, at any time or from time to time, or (ii) by the commencement by or against the Lessee, the Guarantor or any other Person of any proceedings under any bankruptcy or insolvency law or laws relating to the relief of debtors, readjustment of indebtedness, reorganizations, arrangements, compositions or extension or other similar laws. (e) It is the intent and purpose hereof that the Guarantor shall not be entitled to and does hereby waive, to the fullest extent permitted by applicable law, any and all defenses available to guarantors, sureties and other secondary parties at law or in equity. Without limiting the generality of the foregoing, the Guarantor hereby waives notice of acceptance of this Guaranty and of the nonperformance by the Lessee, diligence, presentment, protest, dishonor, demand for payment from the Lessee or any other Person and notice of nonpayment or failure to perform on the part of the Lessee and all other notices whatsoever. The guaranty hereunder is a guaranty of payment, performance and compliance and not of collectability only. The Guarantor specifically 4 agrees that it shall not be necessary, and the Guarantor shall not be required, before or as a condition of enforcing the liability of the Guarantor under this Guaranty or requiring payment or performance of the Guaranteed Obligations by the Guarantor hereunder, or at any time thereafter, that any of the Guaranteed Beneficiaries (i) file suit or proceed to obtain or assert a claim for personal judgment against any Person that may be liable for any Guaranteed Obligation; (ii) make any other effort to obtain payment or performance of any Guaranteed Obligation from the Lessee or any other Person that may be liable for such Guaranteed Obligation; (iii) foreclose against or seek to realize upon any security now or hereafter existing for such Guaranteed Obligation; (iv) exercise or assert any other right or remedy to which any of the Guaranteed Beneficiaries is or may be entitled in connection with any Guaranteed Obligation or any security or other guaranty therefor; (v) assert or file any claim against the assets of the Lessee or any other Person liable for any Guaranteed Obligation; or (vi) join the Lessee or any other Person as a party to any proceeding for the enforcement of any provision of this Guaranty. Without limiting the foregoing, it is understood that repeated and successive demands may be made and recoveries may be had hereunder as and when, from time to time, a Lease Event of Default shall have occurred and be continuing or a Guaranteed Obligation shall otherwise arise (in either case, a "Recovery Event"), and that, notwithstanding recovery hereunder for or in respect of any such Recovery Event, this Guaranty shall remain in force and effect and shall apply to each and every subsequent Recovery Event. The Guarantor further agrees that, without limiting the generality of this Guaranty, if any Recovery Event shall have occurred and be continuing and any Guaranteed Beneficiary (or any assignee thereof) is prevented by applicable law from exercising its remedies under any applicable Loan Document for any reason, such Guaranteed Beneficiary (or any assignee thereof) shall be entitled to receive hereunder from the Guarantor, upon demand therefor, the sums that otherwise would have been due from the Lessee had such remedies been exercised. If the Guarantor makes any payment or performs any obligation hereunder in respect of any of the obligations to be performed by the Lessee, the Guarantor shall become subrogated to the extent of such payment or performance to the rights of the Guaranteed Beneficiary under the relevant agreement to which the Lessee is a party against the Lessee in respect of such obligations and any collateral security or guaranty held by or for the benefit of such Guaranteed Beneficiary for the payment of such obligations; provided, however, that such rights of subrogation shall not commence until such time subsequent to the end of the Term as the Lessee or the Guarantor, as the case may be, shall have paid and performed each and every Guaranteed Obligation to each Guaranteed Beneficiary and the Guarantor shall have fully performed its obligations hereunder. (f) The guaranty hereunder shall not be deemed to have terminated and shall continue to be effective (or if terminated for any reason shall be reinstated, as the case may be), if at any time payment, or any part thereof, of any of the obligations hereunder or under any Loan Document is rescinded and must be (and actually is) returned by any Guaranteed Beneficiary to the Person who made the payment or on behalf of whom the payment was made upon the insolvency, bankruptcy or reorganization (or similar event) with respect to the Lessee, the Guarantor or otherwise, all as though such payment had not been made. (g) If the Guarantor fails to pay any amount hereunder when due to any Guaranteed Beneficiary, the Guarantor shall pay to such Guaranteed Beneficiary interest, on demand, on such amount at the appropriate rate described in Section 2.2D of the Credit Agreement. 5 (h) The Guarantor further agrees to pay to each Guaranteed Beneficiary any and all costs and expenses, including reasonable legal fees (which shall include allocated costs of internal counsel) and disbursements, incurred by such party in connection with enforcing its rights under this Guaranty. SECTION 3. COVENANTS OF GUARANTOR. The Guarantor hereby covenants for the benefit of each Guaranteed Beneficiary as follows: (a) No Assignment by Guarantor. Except as expressly permitted herein, the Guarantor agrees that it shall not assign any of its rights or obligations hereunder without the prior written consent of the Lessor, the Agent, and the Requisite Lenders. The Guarantor acknowledges that the Lessor intends to mortgage, grant, and assign all of the Lessor's right, title, and interest in and to this Guaranty and the Guarantor's obligations hereunder to the Agent, as administrative agent for and representative of the Lenders, as security for the Secured Obligations (as defined in the relevant Aircraft Chattel Mortgage), and the Guarantor hereby consents to such mortgage, grant, and assignment. (b) Default Under Loan Documents. The Guarantor agrees that it shall not take any action or fail to take any action that would cause a Default or Lease Event of Default under any Lease or a Potential Event of Default or Event of Default under any of the other Loan Documents. (c) Financial Statements and Reports. (i) The Guarantor agrees that, beginning with its quarterly report for the fiscal quarter ending September 30, 2001, it shall provide each Guaranteed Beneficiary with copies of the Guarantor's quarterly and annual financial statements for each fiscal quarter as soon as available and in any event within 45 days after the end of the relevant fiscal quarter and for each fiscal year within 90 days after the end of the relevant fiscal year. All such financial statements shall be prepared in accordance with GAAP and the annual financial statements shall be audited by an independent firm of certified public accountants of recognized national standing selected by the Guarantor and satisfactory to the Lessor and the Agent, and shall be accompanied by an unqualified report of such accounting firm, which report shall express no doubts about the ability of the Guarantor and its Subsidiaries to continue as a going concern, and shall state that such consolidated financial statements fairly present the consolidated financial position of the Guarantor and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial statements) and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards. (ii) The Guarantor shall provide each Guaranteed Beneficiary with copies of any interim financial statements that it may prepare for public dissemination from time to time (it being understood that the Guarantor shall have no obligation hereunder to prepare 6 any such interim financial statements for public dissemination) simultaneously with the dissemination thereof. (iii) Within 15 days after receipt by the Guarantor of a notice of request therefor from the Lessor, the Agent, or the Requisite Lenders, the Guarantor shall provide such explanations or related additional information as any Guaranteed Beneficiary may reasonably request with respect to any financial statement provided pursuant to Section 3(d)(i) or (ii) above. (d) Inspection. The Guarantor will permit each Guaranteed Beneficiary (or such Person as such Guaranteed Beneficiary may designate), upon reasonable notice and at a mutually convenient time and, so long as no Event of Default has occurred and is continuing, at such Guaranteed Beneficiary's expense, to visit the headquarters of the Guarantor in order to discuss with the relevant officers of the Guarantor the financial affairs and condition of the Guarantor or of any Subsidiary thereof, to the extent related to the performance of (or ability to perform) its obligations under this Guaranty; provided, that, unless a Lease Event of Default shall have occurred and be continuing, such actions may not unreasonably interfere with the business and operations of the Guarantor or any Subsidiary. (e) GE Capital Loans. The Guarantor will ensure that no default or event of default (or the equivalent thereof) under any of the credit documents entered into or to be entered into in connection with the GE Capital Loans (as defined in the Lease Amendment) occurs or continues. The Guarantor will notify the Lessor, the Agent, and each of the Lenders immediately (i) upon the occurrence of any default or event of default (or the equivalent thereof) or other breach under any of such credit documents, (ii) upon any notice given by any party to such credit documents of the existence of any such default or event of default (or the equivalent thereof) or other breach, regardless of whether such default or event of default (or the equivalent thereof) or other breach shall have actually occurred, and (iii) upon the occurrence of any other event or omission that could reasonably be construed as a default or event of default (or the equivalent thereof) under, or as a breach of, any of such credit documents. SECTION 4. REPRESENTATIONS AND WARRANTIES OF GUARANTOR. The Guarantor makes, for the benefit of each Guaranteed Beneficiary, each of the representations and warranties made in the Lease Agreement by the Lessee as to the Guarantor, its assets, financial condition, operations, organization, legal status, business, and the Loan Documents to which it is a party. SECTION 5. MISCELLANEOUS. (a) Waivers; Cumulative Effect. A waiver by any Guaranteed Beneficiary of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy that such Guaranteed Beneficiary (or any other Guaranteed Beneficiary) would otherwise have had on any future occasion with regard to any subsequent breach. No failure to exercise nor any delay in exercising on the part of any Guaranteed Beneficiary any right, power, or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any 7 other right, power, or privilege. The rights and remedies herein provided are cumulative and may be exercised singularly or concurrently, and are not exclusive of any rights and remedies provided by law or by the Lease Agreement or the other Loan Documents. (b) Amendments; Waivers. This Guaranty may not be terminated, amended, supplemented, waived, or modified orally, but may be terminated, amended, supplemented, waived, or modified upon the prior written consent of the Guarantor, the Lessor, the Agent, and the Requisite Lenders. (c) Severability. Any provision of this Guaranty 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. (d) Counterparts. This Guaranty 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. (e) Notices. Any notice to the Guarantor hereunder may be directed to the Guarantor at its address set forth in Annex A, or to such other address as the Guarantor may designate by notice given to the other parties hereto. (f) Headings, References. The section and paragraph headings in this Guaranty are for convenience of reference only and shall not modify, define, expand or limit any of the terms or provisions hereof. (g) Governing Law. THIS GUARANTY SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY RULE OF LAW THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK. THIS GUARANTY HAS BEEN DELIVERED IN THE STATE OF NEW YORK. (h) Benefit and Binding Effect. The terms of this Guaranty shall be binding upon the Guarantor, and shall inure to the benefit of the Guarantor, each Guaranteed Beneficiary, and their respective successors and permitted assigns (to the extent permitted hereunder and under the Loan Documents). (i) Service of Process; Jurisdiction and Waiver. The Guarantor (A) hereby irrevocably submits to the nonexclusive jurisdiction of (i) the Supreme Court of the State of New York, New York County (without prejudice to the right of any party to remove to the United States District Court for the Southern District of New York) and (ii) 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 Guaranty or the subject matter hereof brought by any Guaranteed Beneficiary or its successors or permitted assigns, (B) hereby irrevocably agrees that all claims in 8 respect of such suit, action or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by applicable law, in such Federal court, and (C) to the extent permitted by applicable law, hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action, or proceeding any claim that it is not personally subject to the jurisdiction of the above-named courts, that the suit, action, or proceeding is brought in an inconvenient forum, that the venue of the suit, action, or proceeding is improper, or that this Guaranty or the subject matter hereof may not be enforced in or by such court. THE GUARANTOR WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY. A final judgment obtained in respect of any suit, action, or proceeding referred to in this Section 5(i) shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any manner as provided by applicable law. The Guarantor hereby consents to service of process in connection with the subject matter specified in the first sentence of this Section 5(i) in connection with the above-mentioned courts by registered mail, FedEx, DHL, or similar courier at the address to which notices to it are to be given as provided in Annex A hereto, it being agreed that service in such manner shall constitute valid service upon the Guarantor and its successors and assigns in connection with any such suit, action, or proceeding only; provided, however, that nothing in this Section 5(i) shall affect the right of any of the Guaranteed Beneficiaries or their successors or assigns to serve legal process in any other matter permitted by law or affect the right of any of the Guaranteed Beneficiaries or their successors or assigns to bring any suit, action, or proceeding against the Guarantor or its properties in the courts of other jurisdictions. * * * * * 9 IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed as of the day and year first written above for the benefit of the parties named herein. ATLAS AIR WORLDWIDE HOLDINGS, INC. By: -------------------------------- Name: Title: 10 Annex A Address for Notices to Guarantor ATLAS AIR WORLDWIDE HOLDINGS, INC. 2000 Westchester Avenue Purchase, New York 10577-2543 Attention: Richard H. Shuyler SCHEDULE I Lease Agreement, dated as of April 25, 2000, between the Lessor and the Lessee, as supplemented by Lease Supplement No. 1, dated as of April 25, 2000, which were recorded together as one instrument by the Federal Aviation Administration (the "FAA") on [May 24], 2000, as Conveyance No. [__________] [,and as further supplemented by Lease Supplement No. 2, dated as of __________, 2000, which was recorded by the FAA on __________, 20___, as Conveyance No. __________], and as amended by Amendment No. 1 to Lease Agreement, dated as of October 15, 2001, and as further amended by Amendment No. 2 to Lease Agreement, dated as of the date of this Guaranty. -----END PRIVACY-ENHANCED MESSAGE-----