Exhibit
4.24
WAIVER, CONSENT AND TENTH AMENDMENT
TO REVOLVING CREDIT, TERM LOAN AND
GUARANTY AGREEMENT
WAIVER, CONSENT AND TENTH AMENDMENT, dated as of January 26, 2005
(the " Amendment "), to the REVOLVING CREDIT, TERM LOAN AND
GUARANTY AGREEMENT, dated as of December 24, 2002, among UNITED AIR
LINES, INC., a Delaware corporation (the " Borrower "), a
debtor and a debtor-in-possession in a case pending under Chapter
11 of the Bankruptcy Code, UAL CORPORATION, a Delaware corporation
and the parent company of the Borrower (the " Parent ") and
all of the direct and indirect subsidiaries of the Borrower and the
Parent signatory thereto (the " Subsidiaries " and together
with the Parent, each a " Guarantor " and collectively the "
Guarantors "), each of which Guarantors referred to in this
paragraph is a debtor and a debtor-in-possession in a case pending
under Chapter 11 of the Bankruptcy Code, JPMORGAN CHASE BANK, N.A.
(formerly known as JPMorgan Chase Bank), a national banking
corporation (" JPMCB "), CITICORP USA, INC., a Delaware
corporation (" CUSA "), THE CIT GROUP/BUSINESS CREDIT, INC.,
a New York corporation (" CIT Group "), GENERAL ELECTRIC
CAPITAL CORPORATION, a Delaware corporation (" GECC "), each
of the other financial institutions from time to time party hereto
(together with JPMCB, CUSA, CIT Group and GECC, the "
Lenders "), JPMORGAN CHASE BANK, N.A. and CUSA, as
co-administrative agents (together, the " Agents ") for the
Lenders and JPMORGAN CHASE BANK, N.A., as paying agent (in such
capacity, the " Paying Agent ") for the Lenders.
W I T N E S S E T
H:
WHEREAS , the Borrower, the Guarantors, the Lenders, the Paying
Agent and the Agents are parties to that certain Revolving Credit,
Term Loan and Guaranty Agreement, dated as of December 24, 2002 (as
heretofore amended, modified or supplemented, and as in effect on
the date hereof, the " Credit Agreement ");
WHEREAS , the Borrower and the Guarantors have requested that
from and after the (i) Waiver and Consent Effective Date (as
hereinafter defined), the Lenders agree to (A) waive the
anticipated and historical Events of Default described in Article
II hereof, (B) consent to the modifications to the corporate
structure and ownership of UAL Loyalty Services, Inc. described in
Article III hereof and the amendments to the Loan Documents
necessary in connection with such modifications and (C) amend
certain financial covenants as set forth in Paragraph 11(A) of this
Amendment and (ii) Amendment Effective Date (as hereinafter
defined), the Credit Agreement be amended as set forth in Article
IV (other than the amendments set forth in Paragraph 11(A) of this
Amendment) hereof to provide, among other things, that the Maturity
Date of the Credit Agreement be extended to September 30, 2005,
that the rates of interest under the Credit Agreement be reduced,
certain financial covenants be amended and that the Credit
Agreement be otherwise amended as set forth herein, all subject to
and upon the terms and conditions set forth herein;
NOW, THEREFORE , the parties hereto hereby agree as
follows:
ARTICLE I.
Definitions
1.
As used herein, all terms that are defined in the Credit Agreement
shall have the same meanings herein.
ARTICLE II.
Waivers
2.
Waiver . The Lenders hereby waive any Events of
Default that might occur or have occurred as a result of (i) the
Borrower's and the Guarantors' anticipated failure to comply with
the cumulative consolidated EBITDAR covenant in Section 6.05 of the
Credit Agreement for the twelve-month period ending January 31,
2005, (ii) the Borrower's and the Guarantors' failure to provide a
copy of the notice required pursuant to Section 5.01(j) of the
Credit Agreement regarding the Borrower's and its ERISA Affiliates'
nonpayment in September and October 2004 of funding obligations in
connection with certain Plans, (iii) the Borrower's failure to
satisfy the condition that no Event of Default shall have occurred
and be continuing at the time of a continuation of a Eurodollar
Loan insofar as the Events of Default described in the preceding
clause (ii) had occurred and were continuing at the time any
Eurodollar Loans may have been continued and (iv) the Borrower's
and the Guarantors' failure to provide written notice required
pursuant to Section 5.05 of the Credit Agreement as a result of the
Events of Default described in clauses (ii) and (iii) of this
paragraph.
ARTICLE III. Consents
3.
Consents and Modification of Security and Pledge Agreement
.
(A) The Lenders hereby
consent to (i) the contribution by the Parent of its equity
interest in UAL Loyalty Services, Inc. to the Borrower, (ii) the
conversion of UAL Loyalty Services, Inc. from a Delaware
corporation to a Delaware limited liability company named UAL
Loyalty Services, LLC and (iii) the replacement in their entireties
of (a) Schedule 1.01(a) 1 to the Credit Agreement with a
new Schedule in the form attached hereto as Exhibit A and (b)
Schedule 3.07 2 to the Credit Agreement with a new
Schedule in the form attached hereto as Exhibit B.
(B) Upon the
effectiveness of the consents granted in Paragraph 3(A) of this
Amendment and the conversion described in clause (ii) of the
Paragraph 3(A) of this Amendment, the Lenders further consent to
(i) the replacement in their entireties of (a) Schedule 3.06
3 to the Credit Agreement with a new Schedule in the
form attached hereto as Exhibit C, (b) Schedule 1(l) 4
to the Security and Pledge Agreement with a new Schedule in the
form attached hereto as Exhibit D and (c) Schedule 4(b)
5 to the Security and Pledge Agreement with a new
Schedule in the form attached hereto as Exhibit E and (ii) the
deemed amendment of the first sentence of Section 4(b) of the
Security and Pledge Agreement to reflect such conversion.
(C) Upon the
effectiveness of the consents granted in Paragraph 3(A) of this
Amendment and the conversion described in clause (ii) of the
Paragraph 3(A) of this Amendment, the Lenders further consent to
following modifications to the Security and Pledge Agreement to
reflect such conversion: (i) the first sentence of Section 4(b) of
the Security and Pledge Agreement shall be deemed amended by adding
the language ", other than that UAL Loyalty Services, Inc. has been
renamed UAL Loyalty Services, LLC" immediately prior to the period
appearing at the end thereof and (ii) the proviso appearing in
Section 4(e) of the Security and Pledge Agreement shall be deemed
deleted in its entirety and replaced with the following new
proviso: " provided that the Grantors do not represent or
warrant that the Pledged Shares representing ownership interests in
(i) Covia LLC, (ii) UAL Loyalty Services, LLCand (iii) corporations
or other entities incorporated or formed in Guam, Bermuda and
Mexico are fully paid and non-assessable."
__________________________________________________________________________________
1 To reflect removal of IAM liens on "Excluded
Flight Simulators" schedule.
2 To reflect removal of IAM liens on "Existing
Liens" schedule.
3 To reflect contribution and conversion of ULS on
"Subsidiaries" schedule.
4 To reflect contribution and conversion of ULS on
"Pledged Shares" schedule.
5 To reflect contribution and conversion of ULS on
"Grantor Legal Names, Jurisdictions and ID Numbers"
schedule.
ARTICLE IV.
Amendments
4. Amendment to First
Paragraph . The first paragraph of the Credit Agreement
is hereby deleted in its entirety and replaced with the following
new paragraph:
REVOLVING CREDIT, TERM LOAN AND GUARANTY AGREEMENT, dated as of
December 24, 2002, among UNITED AIR LINES, INC., a Delaware
corporation (the " Borrower "), a debtor and a
debtor-in-possession in a case pending under Chapter 11 of the
Bankruptcy Code, UAL CORPORATION, a Delaware corporation and the
parent company of the Borrower (the " Parent ") and all of
the direct and indirect subsidiaries of the Borrower and the Parent
signatory hereto (the " Subsidiaries " and together with the
Parent, each a " Guarantor " and collectively the "
Guarantors "), each of which Guarantors referred to in this
paragraph is a debtor and a debtor-in-possession in a case pending
under Chapter 11 of the Bankruptcy Code (the cases of the Borrower
and the Guarantors, each a " Case " and collectively, the "
Cases "), JPMORGAN CHASE BANK, N.A. (formerly known as
JPMorgan Chase Bank), a national banking corporation (" JPMorgan
Chase "), CITICORP USA, INC., a Delaware corporation ("
CUSA "), JPMORGAN CHASE BANK, N.A. (successor by merger to
Bank One, NA), a national banking corporation (" Bank One
"), THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation ("
CIT Group "), each of the other financial institutions from
time to time party hereto (together with JPMorgan Chase, CUSA, Bank
One and CIT Group, the " Lenders "), JPMORGAN CHASE and
CUSA, as co-administrative agents (together, the " Agents ")
for the Lenders and JPMORGAN CHASE, as paying agent (in such
capacity, the " Paying Agent ") for the Lenders.
5. Amendments to
Section 1.01 . Section 1.01 of the Credit Agreement is hereby
amended by:
(A) deleting the
definition of each of the following terms: " Collateral
Documents ", " EBITDAR ", " Maturity Date " and "
Orders ", appearing therein, and inserting the following new
definitions in appropriate alphabetical order:
" Collateral
Documents " shall mean, collectively, the Security and Pledge
Agreement, the Aircraft Mortgage (including, without limitation,
any Mortgage Supplement), the SGR Security Agreement, the Mortgage
Amendment, Mortgage Amendment No. 2, Mortgage Amendment No. 3 and
other agreements, instruments or documents that create or purport
to create a Lien in favor of the Collateral Agent for the benefit
of the Lenders.
" EBITDAR "
shall mean, for any period, all as determined in accordance with
GAAP, the consolidated net income (or net loss) of the Parent and
its Subsidiaries for such period, plus (a) the sum of (i)
depreciation expense; (ii) amortization expense; (iii) other
non-cash charges; (iv) consolidated federal, state and local income
tax expense; (v) gross interest expense for such period less gross
interest income for such period; (vi) (A) aircraft rent expense,
(B) a one-time rent expense in an amount not in excess of
$44,000,000 paid in 2004 in connection with a settlement of the
dispute relating to the Chicago O'Hare municipal bond transaction
relating to the out-of-period portion (relating to 2004) of such
rent expense, (C) a one-time rent expense in an amount not in
excess of $24,000,000 paid in 2005 in connection with the
settlement of the dispute described in the preceding clause
(a)(vi)(B) relating to the out-of-period portion (relating to 2005)
of such rent expense and (D) a one-time rent expense in an amount
not in excess of $8,800,000 paid in 2005 in connection with a
settlement of the dispute relating to the San Francisco municipal
bond transaction relating to the out-of-period portion (relating to
2005) of such rent expense; (vii) extraordinary losses; (viii) any
non-recurring charge or restructuring charge; (ix) the cumulative
effect (whether positive or negative) of any change in accounting
principles; (x) any Fees paid by the Borrower and not otherwise
added back to consolidated net income (or net loss) pursuant to any
of the foregoing clauses of this definition; (xi) the difference
(whether positive or negative) between the cash paid by Chase
Manhattan Bank USA (formerly known as Bank One Delaware, NA) during
such period pursuant to its "Annual Guaranteed Miles Purchased" (as
defined in that certain Co-Branded Card Marketing Services
Agreement, dated July 1, 2001, as heretofore amended, among Chase
Manhattan Bank USA (formerly known as Bank One Delaware, NA),
Parent, the Borrower and UAL Loyalty Services, Inc.) and the amount
of the revenue recorded during such period on account of the miles
so purchased by Bank One pursuant to such agreement during such
period and prior periods; (xii) for the period commencing on the
first fiscal month period ending on September 30, 2004 and ending
on the fiscal month period ending on January 31, 2005, in the event
that the average price of fuel during any fiscal month period
exceeds the price of fuel reflected in the updated business plan
delivered by the Borrower to the Agents on July 13, 2004 for such
fiscal month period, the amount (not to exceed $20,000,000 for such
fiscal month period) by which Borrower's expenditures for fuel for
such fiscal month period exceeds the Borrower's projected
expenditures for fuel for such fiscal month period in such business
plan; (xiii) for the period commencing on the first fiscal month
period ending on February 28, 2005, in the event that the average
price of fuel during any fiscal month period exceeds the price of
fuel reflected in the updated business plan delivered by the
Borrower to the Agents on January 25, 2005 for such fiscal month
period, the amount (not to exceed $20,000,000 for such fiscal month
period) by which Borrower's expenditures for fuel for such fiscal
month period exceeds the Borrower's projected expenditures for fuel
for such fiscal month period in such business plan; and (xiv) if,
prior to April 30, 2005, United has entered into a final agreement
under which the services provided by Air Wisconsin Airlines
Corporation as of January 25, 2005 shall be provided by a
replacement carrier or carriers on forward-looking terms more
favorable than the terms of the Air Wisconsin Airlines Corporation
service arrangement existing on January 25, 2005 and as
incorporated into the Borrower's business plan delivered to the
Agents on January 25, 2005, a one time expense in an amount not in
excess of $84,000,000 incurred as a result of Air Wisconsin
Airlines Corporation's replacement, less (b) extraordinary
gains (including, without limitation, cash or other one time gains
in connection with a replacement of Air Wisconsin in accordance
with clause (a)(xiv) above) plus or minus (c) the
amount of cash received or expended in such period in respect of
any amount which, under clause (a)(viii) above, was taken into
account in determining EBITDAR for such or any prior period,
provided , however , that (X) a one-time amount not
in excess of $50,000,000 paid in respect of the Chicago O'Hare
municipal bond transaction relating to the out-of-period portion
(relating to 2003) of rent expense, and a one-time amount not in
excess of $50,000,000 so paid relating to the out-of-period portion
(relating to 2004) of such rent expense and (Y) a one-time amount
not in excess of $9,000,000 paid in respect of the San Francisco
municipal bond transaction relating to the out-of-period portion
(relating to 2003) of rent expense, and a one-time amount not in
excess of $9,000,000 so paid relating to the out-of-period portion
(relating to 2004) of such rent expense, shall not be so deducted
for purposes of this clause (c).
" Maturity
Date " shall mean September 30, 2005.
" Orders "
shall mean the Interim Order and the Final Order of the Bankruptcy
Court referred to in Sections 4.01(b) and 4.02(d) and the Seventh
Amendment Order, the Eighth Amendment Order and the Tenth Amendment
Order.
(B)
inserting the following new definitions of the terms " Mortgage
Amendment No. 3 " and " Tenth Amendment Order " in
appropriate alphabetical order:
" Mortgage
Amendment No. 3 " shall mean that certain Third Amendment to
the Aircraft Mortgage dated as of February __, 2005.
" Tenth Amendment Order " shall
mean an order of the Bankruptcy Court in form and substance
reasonably satisfactory to the Agents approving the execution of
the Waiver, Consent and Tenth Amendment dated as of January 26,
2005.
,
and (C) amending the definition of the term " Adjusted LIBOR
Rate " by deleting the phrases "the greater
of (A)" and "and (B) 3%" appearing in the first
sentence thereof.
6.
Amendments to Section 2.08 . Section 2.08 of the Credit
Agreement is hereby amended by (A) deleting the amount "4.0%"
appearing in subsection (a) thereof and inserting in lieu thereof
the amount "3.5%" and (B) deleting the amount "5.0%" appearing in
subsection (b) thereof and inserting in lieu thereof the amount
"4.5%".
7.
Amendment to Section 2.21 . Section 2.21 of the Credit
Agreement is hereby amended by deleting the words "five percent
(5.0%)" appearing in clause (i) of the first sentence thereof and
inserting in lieu thereof the words "four and one-half percent
(4.5%)".
8.
Amendment to Section 2.23 . Section 2.23 of the Credit
Agreement is hereby amended by (A) deleting the clause "(y)
[Intentionally omitted] "appearing in the parenthetical at
the end of clause (a)(ii) thereof and (B) inserting in lieu thereof
the following new clause (y):
"(y) that certain
parcel of real property referred to in clause (xxi) of Section 6.01
of the Credit Agreement"
9. Amendment to Section 6.01 .
Section 6.01 of the Credit Agreement is hereby amended by (A)
deleting the word "and" immediately preceding clause (xx) appearing
therein and (B) inserting the following new clause (xxi):
"and (xxi) first
priority Liens on that certain parcel of real property known as the
Borrower's
HNL Seaside Hotel located at 342 Seaside Ave., Waikiki, Honolulu,
HI 96815 (but not on
any personal property therein), in favor of Westchester Insurance
Company ("Westchester")
in connection with the release of Westchester's lien on
that certain parcel of real property
located on Linneman Road in Elk Grove Village, IL"
10. Amendment to Section 6.04 . Section
6.04(c) of the Credit Agreement is hereby deleted in its entirety
and replaced with the following new subsection (c):
"(c) Make
Capital Expenditures during the period
commencing on January 1, 2005 and
ending on September 30, 2005 in an aggregate amount in
excess of $225,000,000 plus the
amount equal to 50% of the amount, if any, by
which $375,000,000 exceeds the amount
of Capital Expenditures made during the period
commencing on April 1, 2004 and ending
on December 31, 2004, and, promptly after the end of each
fiscal month, commencing with
the fiscal month ending January 31, 2005, the Borrower
shall deliver report showing that
during the period commencing January 1, 2005 through the end
of such fiscal month Capital
Expenditures made by the
Borrower and the Guarantors
shall have not exceeded
$225,000,000 in the aggregate plus the amount equal to 50% of the
amount, if any, by which
$375,000,000 exceeds the amount
of Capital Expenditures made
during the period
commencing on April 1, 2004 and ending on December 31, 2004."
11. Amendments to Section 6.05 . (A)
Section 6.05(b) of the Credit Agreement is hereby amended by (i)
deleting from the table appearing therein the dates "February 28,
2005", "March 31, 2005", "April 30, 2005" and "May 31, 2005" and
the amounts appearing opposite such dates and (ii) inserting the
following in lieu thereof, with the date appearing under the column
heading "Month" and the amount appearing under the column heading
"EBITDAR":
|
Month
|
EBITDAR
|
|
February 28, 2005
|
$960,000,000
|
|
March 31, 2005
|
$783,000,000
|
|
April 30, 2005
|
$725,000,000
|
|
May 31, 2005
|
$672,000,000
|
|
|
|
(B) Section 6.05(b) of the Credit Agreement is hereby amended by
inserting the following at the foot of the table appearing therein,
as such table has been amended pursuant to paragraph 11(A) of this
Amendment, with the date appearing under the column heading "Month"
and the amount appearing under the column heading "EBITDAR":
|
June 30, 2005
|
$639,000,000
|
|
July 31, 2005
|
$629,000,000
|
|
August 31, 2005
|
$796,000,000
|
12. Amendment to Section 6.13
. Section 6.13 to the Credit Agreement is hereby deleted in
its entirety and replaced with the following new Section 6.13:
"Section 6.13. Minimum Cash . Permit
cash and cash equivalents (net of cash maintained
in
the Escrow Accounts) to be less than $750,000,000, provided
that if cumulative consolodated
EBITDAR (for purposes of this Section 6.13, clauses (a)(xiii)
and (a)(xiv) of the definition of
EBITDAR shall not be included in the calculation of
EBITDAR) for the twelve month period
ending on June 30, 2005 equals or exceeds
$777,000,000, the Borrower and each of
the
Guarantors will not permit cash and cash
equivalents (net of cash maintained in the
Escrow
Accounts) to be less than $600,000,000."
13. Amendment to Cover Page
. The cover page of the Credit Agreement is hereby amended by
deleting the
name "JPMORGAN CHASE BANK" appearing thereon and replacing it with
the name "JPMORGAN CHASE BANK, N.A. (formerly known as JPMorgan
Chase Bank)".
ARTICLE IV.
Miscellaneous
14. Conditions to Waiver and
Consent Effectiveness . The (i) waivers set forth in
Article II of this Amendment, (ii) consents (and modifications to
the Loan Documents) set forth in Article III of this Amendment,
(iii) amendment to the term "EBITDAR" set forth in Paragraph 5(A)
of this Amendment and (iv) amendments set forth in Paragraph 11(A)
of Article IV of this Amendment, shall not become effective until
the date (the " Waiver and Consent Effective Date ") on
which this Amendment shall have been executed by the Borrower, the
Guarantors and the Required Lenders and each Agent shall have
received evidence reasonably satisfactory to it of such execution;
provided that the consents and modifications set forth in
Paragraphs 3(A)(i), 3(A)(ii), 3(B) and 3(C) of this Amendment shall
be deemed terminated and to h
