Mikelsons J George, et al. – ‘SC 13D’ on 6/21/01 re: Ata Holdings Corp – EX-2

On:  Thursday, 6/21/01, at 3:59pm ET   ·   Accession #:  950157-1-500286   ·   File #:  5-42897

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

General Statement of Beneficial Ownership   —   Schedule 13D
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 13D      General Statement of Beneficial Ownership              8     37K 
 2: EX-1        Stock Subscription Agreement                           2      8K 
 3: EX-2        Commitment Letter                                     19     72K 

EX-2   —   Commitment Letter
Exhibit Table of Contents

EX-2
1st Page of 19
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
[GRAPHIC OMITTED]                                                               

June 18, 2001                                                                   

American Trans Air, Inc.                                                        
7337 West Washington Street                                                     
Indianapolis, IN 46251-0609                                                     

Amtran, Inc.                                                                    
7337 West Washington Street                                                     
Indianapolis, IN 46251-0609                                                     

Attention:   Mr. J. George Mikelsons                                            
Chairman of the Board                                 
Mr. John P. Tague                                     
President and Chief Executive Officer                 

      $175,000,000 3-Year Reducing Revolving Credit Facility
 COMMITMENT LETTER

Ladies and Gentlemen:                                                           

Citicorp USA, Inc. ("Citicorp") is pleased to inform American Trans Air, Inc.   
(the "Company") of Citicorp's commitment to provide the Company the entire      
amount of a $175,000,000 three year reducing revolving credit facility (the     
"Facility") and to act as Administrative Agent for the Facility, subject to     
the terms and conditions of this letter and the attached Annex I                
(collectively, and together with the Fee Letter referred to below, this         
"Commitment Letter"). The proceeds of the Facility will be used to acquire      
100% of the outstanding (approximately 3.1 million shares) public shares of     
the common stock, without par value, of Amtran, Inc. ("Amtran"), and certain    
employee options to purchase shares of such stock, for a total purchase price   
not to exceed $82.0 million, to pay transaction expenses associated therewith,  
and to provide for the ongoing working capital needs and general corporate      
purposes of Amtran and its subsidiaries.                                        

Section 1. Conditions Precedent. Citicorp's commitment hereunder is subject     
to: (i) Citicorp's not having discovered or otherwise becoming aware of         
information not previously disclosed to Citicorp that Citicorp reasonably       
believes to be materially inconsistent with its understanding, based on the     
information provided to Citicorp prior to the date hereof, of the business,     
operations, properties, assets, financial condition, contingent liabilities or  
material agreements of the Company; (ii) the preparation,                       

EX-2
2nd Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 2nd
execution and delivery of mutually acceptable loan documentation (the           
"Operative Documents"); (iii) the absence of (A) any material adverse change    
in the business, condition (financial or otherwise), operations or properties   
of Amtran and its subsidiaries, taken as a whole, since December 31, 2000, and  
(B) any change in loan syndication, financial or capital market conditions      
generally that, in the judgment of Salomon Smith Barney Inc. ("SSBI", and       
together with Citicorp, "Citi/SSB"), would materially impair syndication of     
the Facility; (iv) the accuracy and completeness in all material respects of    
all representations that the Company makes to Citi/SSB and all information      
that the Company furnishes to Citi/SSB, in each case in connection with this    
Commitment Letter, and the Company's compliance in all material respects with   
the terms of this Commitment Letter; and (v) the payment in full of all fees,   
expenses and other amounts payable under this Commitment Letter.                

Section 2. Commitment Termination. Citicorp's commitment hereunder will         
terminate on the earlier of (a) the date the Operative Documents become         
effective, and (b) October 31, 2001. Before such date, Citicorp may terminate   
its commitment hereunder if any event occurs or information becomes available   
that, in its reasonable judgment (after providing the Company a reasonable      
period to cure, but only if such event or information is capable of being       
cured (as determined by Citicorp in its sole discretion)), results or is        
reasonably likely to result in the failure to satisfy any condition set forth   
in Section 1.                                                                   

Section 3. Syndication. Citicorp reserves the right, before or after the        
execution of the Operative Documents, to syndicate all or a portion of its      
commitment to one or more other financial institutions that will become         
parties to the Operative Documents pursuant to a syndication to be managed by   
SSBI in consultation with the Company (the financial institutions becoming      
parties to the Operative Documents being collectively referred to herein as     
the "Lenders"). SSBI will manage all aspects of the syndication in              
consultation with the Company, including the timing of all offers to potential  
Lenders, the determination of the amounts offered to potential Lenders, the     
acceptance of commitments of the Lenders and the compensation to be provided    
to the Lenders.                                                                 

The Company shall take all action as SSBI may reasonably request to assist      
SSBI in forming a syndicate acceptable to SSBI. The Company's assistance in     
forming such a syndicate shall include but not be limited to: (i) making        
senior management and representatives of the Company available to participate   
in information meetings with potential Lenders at such times and places as      
SSBI may reasonably request; (ii) using the Company's reasonable best efforts   
to ensure that the syndication efforts benefit from the Company's lending       
relationships; and (iii) providing SSBI with all information reasonably deemed  
necessary by it to successfully complete the syndication.                       

To ensure an effective syndication of the Facility, the Company agrees that     
until the termination of the syndication (as determined by SSBI), the Company   
will not, and will not permit any of its affiliates to, syndicate or issue,     
attempt to syndicate or issue, announce or authorize the announcement of the    
syndication or issuance of, or engage in discussions concerning the             
syndication or issuance of, any debt facility or debt security (including any   
renewals thereof) other than (i) the financing of the acquisition of aircraft   

2   

EX-2
3rd Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 3rd
from The Boeing Company (excluding bank debt incurred to directly finance the   
purchase of aircraft), (ii) indebtedness incurred to finance Amtran's training  
facility, including, without limitation, indebtedness to finance the            
acquisition of real estate and a flight simulator, and (iii) general operating  
leases of aircraft, without the prior written consent of SSBI (which consent    
shall not be unreasonably withheld).                                            

Citicorp will act as the sole Agent for the Facility and SSBI will act as sole  
syndication agent. No additional agents, co-agents or arrangers will be         
appointed, or other titles conferred, without the consent of SSBI and           
Citicorp.                                                                       

Section 4. Fees. In addition to the fees described in Annex I, the Company      
shall pay the fees set forth in that certain letter agreement dated the date    
hereof (the "Fee Letter") between the Company and Citi/SSB. The terms of the    
Fee Letter are an integral part of Citicorp's commitment hereunder and          
constitute part of this Commitment Letter for all purposes hereof.              

Section 5. Indemnification. The Company shall indemnify and hold harmless       
Citi/SSB, each Lender and each of their respective affiliates and each of       
their respective officers, directors, employees, agents, advisors and           
representatives (each, an "Indemnified Party") from and against any and all     
claims, damages, losses, liabilities and expenses (including, without           
limitation, reasonable fees and disbursements of external counsel), joint or    
several, that may be incurred by or asserted or awarded against any             
Indemnified Party (including, without limitation, in connection with any        
investigation, litigation or proceeding or the preparation of a defense in      
connection therewith), in each case arising out of or in connection with or by  
reason of this Commitment Letter or the Operative Documents or the              
transactions contemplated hereby or thereby or any actual or proposed use of    
the proceeds of the Facility, except to the extent such claim, damage, loss,    
liability or expense is found in a final, non-appealable judgment by a court    
of competent jurisdiction to have resulted from such Indemnified Party's gross  
negligence or willful misconduct. In the case of an investigation, litigation   
or other proceeding to which the indemnity in this paragraph applies, such      
indemnity shall be effective whether or not such investigation, litigation or   
proceeding is brought by the Company, any of its directors, security holders    
or creditors, an Indemnified Party or any other person or an Indemnified Party  
is otherwise a party thereto and whether or not the transactions contemplated   
hereby are consummated.                                                         

No Indemnified Party shall have any liability (whether in contract, tort or     
otherwise) to the Company or any of its security holders or creditors for or    
in connection with the transactions contemplated hereby, except for direct      
damages (as opposed to special, indirect, consequential or punitive damages     
(including, without limitation, any loss of profits, business or anticipated    
savings)) determined in a final non-appealable judgment by a court of           
competent jurisdiction to have resulted from such Indemnified Party's gross     
negligence or willful misconduct.                                               

Section 6. Costs and Expenses. The Company shall pay, or reimburse Citi/SSB on  
demand for, all reasonable out-of-pocket costs and expenses incurred by         
Citi/SSB                                                                        

3   

EX-2
4th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 4th
(whether incurred before or after the date hereof) in connection with the       
Facility and the preparation, negotiation, execution and delivery of this       
Commitment Letter, including, without limitation, the reasonable fees and       
expenses of external counsel, regardless of whether any of the transactions     
contemplated hereby are consummated. The Company shall also pay all costs and   
expenses of Citi/SSB (including, without limitation, the reasonable fees and    
disbursements of external counsel) incurred in connection with the enforcement  
of any of its rights and remedies hereunder.                                    

Section 7. Confidentiality. By accepting delivery of this Commitment Letter,    
the Company agrees that this Commitment Letter is for the Company's             
confidential use only and that neither its existence nor the terms hereof will  
be disclosed by the Company to any person other than the Company's and          
Amtran's officers, directors, employees, accountants, attorneys and other       
advisors, and then only on a confidential and "need to know" basis in           
connection with the transactions contemplated hereby; provided, however, that   
the Company may make such other public disclosures of the terms and conditions  
hereof as the Company is required by law, in the opinion of the Company's       
counsel, to make. For the avoidance of doubt, this Commitment Letter may be     
disclosed to a Special Committee of Amtran's Board of Directors formed to       
consider the acquisition of shares referred to in the introductory paragraph    
of this Commitment Letter and, subject to the restrictions set forth in the     
immediately preceding sentence with respect to Amtran, to the Special           
Committee's attorneys and financial and other advisors.                         

Section 8. Representations and Warranties of the Company. The Company           
represents and warrants that (i) all information (other than the projections    
referred to in clause (ii) below) that has been or will hereafter be made       
available to Citi/SSB, any Lender or any potential Lender by the Company or     
any of its representatives in connection with the transactions contemplated     
hereby is and will be complete and correct in all material respects and does    
not and will not contain any untrue statement of a material fact or omit to     
state a material fact necessary in order to make the statements contained       
therein not misleading in the light of the circumstances under which they were  
or are made and (ii) all financial projections, if any, that have been or will  
be prepared by the Company and made available to Citi/SSB, any Lender or any    
potential Lender have been or will be prepared in good faith based upon         
reasonable assumptions (it being understood that such projections are subject   
to significant uncertainties and contingencies, many of which are beyond the    
Company's control, and that no assurance can be given that the projections      
will be realized). The Company agrees to supplement the information and         
projections from time to time until the Operative Documents become effective    
so that the representations and warranties contained in this paragraph remain   
correct.                                                                        

In providing this Commitment Letter, Citi/SSB is relying on the accuracy of     
the information furnished to it by or on behalf of the Company and its          
affiliates without independent verification thereof.                            

Section 9. No Third Party Reliance, Etc. The agreements of Citi/SSB hereunder   
and of any Lender that issues a commitment to provide financing under the       
Facility are made solely for the benefit of the Company and may not be relied   
upon or enforced by any                                                         

4   

EX-2
5th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 5th
other person. Please note that those matters that are not covered or made       
clear herein are subject to mutual agreement of the parties. The Company may    
not assign or delegate any of its rights or obligations hereunder without       
Citi/SSB's prior written consent. This Commitment Letter may not be amended or  
modified except in a written agreement signed by all parties hereto. This       
Commitment Letter is not intended to create a fiduciary relationship among the  
parties hereto.                                                                 

The Company should be aware that Citi/SSB and/or one or more of its affiliates  
may be providing financing or other services to parties whose interests may     
conflict with the Company's interests. Consistent with Citi/SSB's longstanding  
policy to hold in confidence the affairs of its customers, neither Citi/SSB     
nor any of its affiliates will furnish confidential information obtained from   
the Company to any of Citi/SSB's other customers. Furthermore, neither          
Citi/SSB nor any of its affiliates will make available to the Company           
confidential information that Citi/SSB obtained or may obtain from any other    
customer.                                                                       

Section 10. Governing Law, Etc. This Commitment Letter shall be governed by,    
and construed in accordance with, the law of the State of New York. This        
Commitment Letter sets forth the entire agreement between the parties with      
respect to the matters addressed herein and supersedes all prior                
communications, written or oral, with respect hereto. This Commitment Letter    
may be executed in any number of counterparts, each of which, when so           
executed, shall be deemed to be an original and all of which, taken together,   
shall constitute one and the same Commitment Letter. Delivery of an executed    
counterpart of a signature page to this Commitment Letter by telecopier shall   
be as effective as delivery of an original executed counterpart of this         
Commitment Letter. Sections 3 through 8, 10 and 11 hereof shall survive the     
termination of Citicorp's commitment hereunder.                                 

Section 11. Waiver of Jury Trial. Each party hereto irrevocably waives all      
right to trial by jury in any action, proceeding or counterclaim (whether       
based on contract, tort or otherwise) arising out of or relating to this        
Commitment Letter or the transactions contemplated hereby or the actions of     
the parties hereto in the negotiation, performance or enforcement hereof.       

Please indicate the Company's acceptance of the provisions hereof by signing    
the enclosed copy of this Commitment Letter and the Fee Letter and returning    
them to Stephen Sellhausen, Managing Director, Salomon Smith Barney Inc., 390   
Greenwich Street, New York, New York 10013 (fax: 212-816-7076) at or before     
11:00 p.m. (New York City time) on June 18, 2001, the time at which Citicorp's  
commitment hereunder (if not so accepted prior thereto) will terminate. If the  
Company and Amtran elect to deliver this Commitment Letter by telecopier,       
please arrange for the executed original to follow by next-day courier.         

5   

EX-2
6th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 6th
Very truly yours,                                                               

SALOMON SMITH BARNEY INC.                                                       

By /s/ J. Gregory Davis                                                         
---------------------                                                     
Name: J. Gregory Davis                                                  
Attorney-in-fact                                            

CITICORP USA, INC.                                                              

By /s/ J. Gregory Davis                                                         
---------------------                                                     
Name: J. Gregory Davis                                                  
Title: Vice President                                                   

ACCEPTED AND AGREED                                                             
on June 18, 2001:                                                               

AMERICAN TRANS AIR, INC.                                                        

By /s/ Kenneth K. Wolff                                                         
-------------------------------------                                     
Name: Kenneth K. Wolff                                                    
Title: Executive Vice President & CFO                                     

AMTRAN, INC.                                                                    

By /s/ Kenneth K. Wolff                                                         
-------------------------------------                                     
Name: Kenneth K. Wolff                                                    
Title: Executive Vice President & CFO                                     

6   

EX-2
7th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 7th
                                                                     Annex I

STRICTLY CONFIDENTIAL 

SUMMARY OF TERMS AND CONDITIONS 
___________________________________ 
$175 Million Secured Credit Facility  

Borrower:                         American Trans Air, Inc. (the "Borrower").    

Borrower Parent:                  Amtran, Inc. ("Amtran").                      

Lead Arranger,                                                                  
Book Manager and                                                                
Syndication Agent:               Salomon Smith Barney Inc. (the "Syndication    
        Agent" or "Arranger").

Administrative Agent:            Citicorp USA, Inc. (the "Administrative        
Agent")       

Lenders:                         Citicorp USA, Inc. and such other lenders      
                             as may be mutually acceptable to Amtran and
                             the Arranger (collectively, the "Lenders").

Description of Credit Facility:  A three-year Secured Reducing Revolving        
                           Credit Facility in an aggregate principal
                             amount of $175 million (the "Secured Credit
Facility").   

Letter of Credit:                A portion of the Secured Credit Facility       
                      not in excess of $50 million will be
                          available for the issuance of letters of
                             credit on terms to be mutually agreed upon.

Purpose:                         The Secured Credit Facility will be used to    
                             finance the acquisition (the "Acquisition")
                             of all the outstanding public shares (which
                          acquired shares will be canceled) of the
                            common stock, without par value, of Amtran
                           other than those owned by certain members
                           of the management of Amtran and J. George
                         Mikelsons (the amount available for the
                         acquisition of the shares not to exceed
                         $82.0 million in the aggregate), to pay
                           related transaction fees and expenses, to
                          purchase rotables and to provide for the
                           ongoing working capital needs and general
                      corporate purposes of Amtran and its
                            subsidiaries. Amounts to be used by Amtran
                          shall be made available by inter-company
loan.         

Availability:                    Loans under the Senior Secured Facility        
                            will be available at any time prior to the
                      final maturity of the Senior Secured

EX-2
8th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 8th
                           Facility. Amounts repaid under the Senior
                     Secured Facility may be reborrowed.

Closing Date:                    The date upon which all conditions             
                           precedent have been met (which date shall
                     be no later than October 31, 2001).

Interest Rates and Interest                                                     
Periods:                         At the Borrower's option, any Advance that     
                        is made to it will be available at the
                           rates and for the Interest Periods stated
below:        

                         Base Rate:  a fluctuating rate equal to
                                Citibank, N.A.'s Base Rate plus the Applicable
Margin.       

                               Eurodollar Rate:  a periodic fixed rate equal
                      to LIBOR plus the Applicable Margin.

                       The Eurodollar Rate will be fixed for
                              Interest Periods of 1, 2, 3, or 6 months, or
                               if the Lenders shall agree at such time, 9 or
                           12 months, at the option of the Borrower.

                    Upon the occurrence and during the
                           continuance of any Event of Default, each
                           Eurodollar Rate Advance will convert to a
                              Base Rate Advance at the end of the Interest
                           Period then in effect for such Eurodollar
Rate Advance. 

Applicable Margin:               The Applicable Margin means the applicable     
                             margin for Base Rate Advances or Eurodollar
                              Rate Advances, as the case may be, specified
                            in the attached Pricing Grid, based on the
                               Borrower's long-term senior secured bank debt
ratings.      

                    Upon the occurrence and during the
                      continuance of any Event of Default,
                     the Applicable Margin will increase
                by 200 basis points per annum.

Letter of Credit Fronting Fee:   12.5 bps.                                      

Collateral:                      The Secured Credit Facility will be secured    
                        by (collectively, the "Collateral"): a
                               first-priority, perfected lien on all assets,
                           including aircraft, receivables, engines,
                              rotables and other equipment of the Borrower
                            and its subsidiaries, and including all of
                              the capital stock of the Borrower's domestic
                             subsidiaries. The Lenders may have to share
                              in the Collateral with a fuel hedge provider
(if any)      

2   

EX-2
9th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 9th
                             to the Borrower, provided that the terms of
                             the fuel hedge are reasonably acceptable to
the Arranger. 

Collateral Maintenance:          Reasonable and customary for facilities of     
                             this type. All assets will be appraised and
                               physically inspected on or before the Closing
                  Date. Thereafter, in addition to
                   reevaluations based on changes in
                             Collateral, all assets will be appraised on
                           or before each anniversary of the Closing
                          Date. Such subsequent appraisals will be
                             updated desk-top appraisals. All appraisals
                      will be on a basis acceptable to the
Arranger.     

                          With respect to spare engines, parts and
                             rotables, the Borrower shall also provide a
                             monthly statement setting forth the current
             book value of these assets.

                             With respect to aircraft, the value used in
                            calculating the Borrowing Base will be the
                           appraised value as determined by the most
          recent annual appraisal.

                           With respect to parts, rotables and spare
                          engines, the value used to calculate the
                               Borrowing Base will be the lesser of the most
                            recent appraised value and the most recent
                     book value set forth in the monthly
certificate.  

Borrowing Base:                  The available commitment shall not exceed the  
                          Borrowing Base. The Borrowing Base shall
        consist of the sum of:

                             70% of the value of each L-1011-50 aircraft
                      pledged, and 70% of the value of the
                              L-1011-50 engines for such aircraft pledged,
                               75% of the value of each 727-Stage 3 aircraft
                               pledged and 75% of the value of the 727-Stage
                              3 aircraft engines for such aircraft pledged
                             (other than any of the fourteen 727-Stage 3
                           aircraft and related engines currently on
                          lease to the Borrower and expected to be
                             purchased by the Borrower and substantially
                             simultaneously sold to the Borrower's joint
                              venture with The Boeing Company), 70% of the
                               value of each L-1011-500 aircraft pledged and
                            70% of the value of the L-1011-500 engines
                             for such aircraft pledged, 70% of the value
                              of aircraft engines deemed acceptable to the
                          Lenders and Amtran for such aircraft not
                            included in the Borrowing Base, 70% of the
                        value of the eligible rotables pledged
                        (provided, however, the total value of
                            rotables used in determining the Borrowing
                            Base shall not exceed $75 million), 80% of
  the value of the

3   

EX-2
10th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 10th
                             eligible receivables pledged and 60% of the
                             value of all other eligible assets included
        in the Borrowing Base.

                   Monthly Borrowing Base compliance
                certificates will be required.

Mandatory Prepayments and                                                       
Commitment Reductions:           Customary for credit facilities of this type   
                including, but not limited to:

                          (a) mandatory commitment reductions and,
                      thereafter, to the extent necessary,
                           mandatory prepayments in the event of any
                         disposition of any Collateral and other
                             assets by Amtran or any of its subsidiaries
                             in amounts equal to 100% of the proceeds of
                          such disposition (other than proceeds of
                               disposition of any aircraft sold to the joint
                             venture with The Boeing Company referred to
                           under the Borrowing Base above); provided
                            that (i) in the case of the disposition of
                    any Collateral, (A) Amtran and its
                            subsidiaries will be permitted to reinvest
                             100% of the proceeds of such disposition in
                             eligible Collateral if such reinvestment is
                              made within 90 days of such disposition; and
                          (B) mandatory commitment reductions (and
                            mandatory prepayments) in the event of the
                       disposition of Collateral will not be
                             required for up to $10 million in aggregate
                            in proceeds so long as amounts outstanding
                          under the Secured Credit Facility do not
                               exceed the Borrowing Base (at the time of and
                            after giving effect to such disposition of
                       Collateral) and no Default shall have
                             occurred and be continuing; and (ii) in the
                              case of the disposition of any other assets,
                         (A) Amtran and its subsidiaries will be
                       permitted to reinvest 100% of the net
                           proceeds (after the repayment of any debt
                             secured by such assets) of such disposition
                   in the business of Amtran if such
                              reinvestment is made within 180 days of such
                           disposition; and (B) mandatory commitment
                             reductions (and mandatory prepayments) upon
                               the disposition of such other assets will not
                          be required for up to $15 million in the
                          aggregate in proceeds so long as amounts
                               outstanding under the Secured Credit Facility
                               do not exceed the Borrowing Base (at the time
                    of and after giving effect to such
                             disposition of other assets) and no Default
                        shall have occurred and be continuing;

                          (b) mandatory commitment reductions and,
                               thereafter to the extent necessary, mandatory
              prepayments upon any loss of

4   

EX-2
11th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 11th
                             or damage to any Collateral which cannot or
                         is not repaired in amounts equal to the
                           greater of the insurance proceeds of such
                     loss or damage or the value of such
 Collateral; and

                       (c) upon delivery of a Borrowing Base
                          certificate, mandatory prepayment to the
                              extent outstandings under the Secured Credit
                           Facility exceed the Borrowing Base as set
            forth in such certificate.

                              Mandatory commitment reductions under clause
                              (a) above will not be required to be made to
                             the extent such reductions would reduce the
                         available commitments under the Secured
                               Credit Facility to less than $100 million (or
                         $125 million in the event the scheduled
                               commitment reductions as of December 31, 2002
                               shall be limited to that amount, as described
              under "Amortization" below).

                         Available commitments under the Secured
                               Credit Facility will be reduced in connection
                           with (a) any debt issuance, excluding any
                      purchase money debt incurred for the
                             acquisition of aircraft, engines, rotables,
                               flight-related equipment and real estate used
                          for a training facility, as well as debt
                            subordinate to the Secured Credit Facility
                              incurred to redeem preferred stock and other
                           indebtedness (if any) permitted under the
                              Secured Credit Facility (each such exclusion
                               subject to the limitation on indebtedness set
                            forth in the financial covenants described
                            below) after the Closing Date by Amtran or
                               any of its subsidiaries by an amount equal to
                               100% of the proceeds of such issuance and (b)
                             any equity issuance (excluding issuances of
                             employee stock options but not the proceeds
                            of the exercise of any such options) after
                          the Closing Date by Amtran or any of its
                               subsidiaries by an amount equal to 50% of the
            proceeds of such issuance.

Voluntary Prepayments:           Outstanding loans under the Secured Credit     
                             Facility may be voluntarily prepaid without
                        penalty subject to three business days
                              irrevocable prior notice; provided, however,
                                 that LIBOR breakage costs, if any, shall be for
              the account of the Borrower.

Guarantees:                      Guarantees shall be delivered by Amtran and    
                             all of its direct and indirect, current and
                               future domestic subsidiaries of Amtran (other
     than the Borrower).

5       

EX-2
12th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 12th
Amortization:                    The Secured Credit Facility will mature on     
                               the date that is three years from the Closing
                           Date, and will be subject to an automatic
                               reductions in the aggregate commitment amount
                         to $160 million on March 31, 2002, $145
                           million on June 30, 2002, $135 million on
                        September 30, 2002 and $100 million on
                            December 31, 2002; provided, however, that
                          the commitments shall be reduced to $125
                            million as of December 31, 2002 if (a) the
                               leverage ratio of Amtran and its consolidated
                       subsidiaries, taken as a whole, as of
                               September 30, 2002 does not exceed a mutually
                               agreed upon level and (b) for a period of not
                           fewer than 60 consecutive days during the
                               90-day period ending on December 31, 2002, no
                                principal of or interest on the Secured Credit
                             Facility has been outstanding and there has
                                been no drawing on any letter of credit issued
                    under the Secured Credit Facility.

Financial Covenants:             Customary for credit facilities of this type   
                              and others to be reasonably specified by the
                               Arrangers, including, but not limited to, the
following:    

                                 o Maximum Lease Adjusted Debt to EBITDAR Ratio;
                               o Minimum EBITDAR to Fixed Charges Ratio; and
                                o Minimum net worth (excluding non-cash write-
               offs of L-1011 aircraft).

Credit Documentation:            The Secured Credit Facility will be subject    
                               to the preparation, execution and delivery of
                            mutually acceptable documentation ("Credit
                               Documentation") which will contain Conditions
                            Precedent, Representations and Warranties,
                        Covenants, Events of Default and other
                     provisions customarily found in the
                         Arranger's and Citicorp U.S.A.'s credit
                              documentation for facilities of this nature.

Conditions Precedent to                                                         
the Closing Date:                Customary for facilities of this nature        
                including, but not limited to:

                             a)  execution of mutually acceptable Credit
        Documentation;
                                 b)  creation and perfection of any lien granted
              over the Collateral;
                               c)  the plan of, and amounts involved in, the
                                    roll-over of management and equity options
                     acceptable to the Arranger;

6   

EX-2
13th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 13th
                              d)  the completion of legal due diligence in
                          connection with the transactions
                                  contemplated hereby and due diligence in
                              respect of the Collateral (including
                                    rotables, receivables and appraisal of the
                                value of the relevant Collateral by an
                                    independent, third party appraisal firm or
                                  firms satisfactory to the Arranger), the
                              results of which shall be reasonably
                             satisfactory to the Arranger in all
   respects;
                            e)  certified copies of each of Borrower's
                                 and Amtran's articles of incorporation,
                                by-laws, board resolutions relating to
                         the Secured Credit Facility and
                  incumbency certificates;
                         f) legal opinions from special New York
                            counsel for each of the Borrower and
                             Amtran and a solvency opinion from an
                      independent solvency evaluator
                     satisfactory to the Arranger;
                         g) a certified or conformed copy of the
                             merger agreement, as in effect on the
                       Closing Date (including without
                                 limitation all amendments and supplements
                                thereto), together with a description of
                                the Borrower's plans with respect to the
                    retention of key management;
                       h) delivery of pro forma consolidated
                              financial statements of Amtran and its
                              consolidated subsidiaries after giving
                  effect to the Acquisition;
                           i) evidence that the Acquisition has been
                              or will be, consummated simultaneously
                                 with the making of the initial borrowing;
                             j) a list of Borrower's and Amtran's assets
                              pledged to secure any financing (other
                                than the Secured Credit Facility), as of
         the Closing Date;
                             k) the absence of a material adverse change
                                since December 31, 2000 in the business,
                         financial condition or results of
                    operations of Amtran and its
                       subsidiaries, taken as a whole;
                       l) disclosure of material agreements;
                            m) neither the Secured Credit Facility nor
                        the consummation of transactions
                                contemplated thereby will conflict with,
                                 violate, or result in a default under any
                        material contract, agreement, or
                                instrument to which Amtran or any of its
                             subsidiaries is a party and that will
                                 remain outstanding after giving effect to
        the Acquisition;
                             n) evidence that as of the Closing Date the
                                funded lease-adjusted debt of Amtran and
                               its subsidiaries is no more than US$955
million;

7   

EX-2
14th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 14th
                          o) evidence that as of the Closing Date,
                      Amtran's minimum cash (or cash
                                equivalents) on hand is no less than $85
million;
                            p) evidence that excess availability under
                              the Borrowing Base is no less than $50
    million; and
                          q) payment of accrued fees and expenses.

Conditions Precedent to                                                         
Each Advance under                                                              
Secured Credit Facility:         Customary for credit facilities of this type   
                             including, but not limited to: no unmatured
                      Event of Default or Event of Default
                        (collectively, a "Default") shall have
                 occurred and be continuing, the
                          representations and warranties set forth
                             under "Representation and Warranties" below
                           shall be true and correct in all material
                              respects with the same effect as though such
                              representations and warranties had been made
                            on the date of each Advance, except to the
                         extent such representation and warranty
                              relates to an earlier date (in which case on
                             and as of such earlier date) and compliance
          with the Borrowing Base.

Negative Covenants:              Customary for credit facilities of this type   
                               including, but not limited to: limitations on
                              other indebtedness and liens, limitations on
                              investments and acquisitions, limitations on
                              restricted payments, limitations on the sale
                       of assets, limitations on mergers and
                        consolidations, limitations on capital
                               expenditures, and limitations on transactions
                              with affiliates. Negative covenants shall be
                         applicable to Amtran and to each of its
subsidiaries. 

Affirmative Covenants:           Customary for credit facilities of this type   
                               including, but not limited to: maintenance of
                        existence, performance of obligations,
                              delivery of financial and other information,
                          maintenance of properties and insurance,
                       compliance with laws and regulations,
                             inspection of books and records, payment of
                            taxes; and continuing obligation to ensure
                      the facility is secured. Affirmative
                             covenants shall be applicable to Amtran and
              to each of its subsidiaries.

Representations and Warranties:  Customary for credit facilities of this type   
                               including, but not limited to, the following:

                        a)  organization, power and authority;
                              b)  due authorization and legality of Credit
                                Documentation; no violation of laws or
             material contracts;

8   

EX-2
15th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 15th
                           c)   governmental licenses and approvals;
                          d)   legality, validity, binding effect,
                                   enforceability of Credit Documentation;
                         e)   financial statements; absence of a
                                      material Adverse change since December 31,
                                     2000 in the business, financial condition
                                  or results of operations of Amtran and
                               its subsidiaries, taken as a whole;
                      f)   absence of material litigation;
g)   taxes;   
       h)   full disclosure;
                                i)   compliance with law, including applicable
                              aviation laws and regulations, and
                   regulations and orders;
              j)   Investment Company Act;
k)   solvency;
                                 l)   Credit Documentation in proper legal form;
m)   liens;   
              n)   margin regulations; and
                                o)   consummation of the Acquisition including
                                     related approvals and absence of material
       litigation.

Events of Default:               Customary for credit facilities of this type,  
                               including, but not limited to, the following:

                              a)  nonpayment of principal, interest, fees,
                                or other amounts due under the Secured
                                   Credit Facilities, subject (except in the
                                   case of principal) to a grace period of 3
        business days;
                            b)  material inaccuracy of representations
         and warranties;
                        c)  violation of covenants (including,
                            without limitation, the failure to
                          maintain the necessary operating
                           licenses) subject, in the case of
                              covenants other than those financial
                             covenants relating to insurance and
                                operating licenses and other covenants
                                   customarily not subject to a grace period
                                 or not curable, to a grace period of 30
days; 
                      d)  the Borrower's loss of status as
                     a Certificated Air Carrier;
                            e)  bankruptcy, judgment of $10 million or
                               greater and not discharged, bonded or
                   stayed; and ERISA events;
                                 f)  invalidity or non-perfection of collateral;
                              lack of first priority of liens; and
                             g)  cross-default and cross-acceleration to
                                  other indebtedness of each of Amtran and
                             its subsidiaries subject to minimum
               amounts to be agreed.

9     

EX-2
16th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 16th
Voting:                          Amendments and waivers with respect to the     
                        Credit Documentation shall require the
                             approval of Lenders holding not less than a
                              majority of the aggregate amount outstanding
                              under the Secured Credit Facility and unused
                               commitments under the Secured Credit Facility
                               (the "Majority Lenders"), except that (a) the
                          consent of each Lender directly affected
                               thereby shall be required with respect to (i)
                               reductions in the amount or extensions of the
                               scheduled date of final maturity of any loan,
                            (ii) reductions in the rate of interest or
                       any fee or extensions of any due date
                               thereof, and (iii) increases in the amount or
                               extensions of the expiry date of any Lender's
                               commitment and (b) the consent of 100% of the
                               Lenders shall be required with respect to (i)
                    modifications to any of the voting
                     percentages and (ii) release of the
                               Guarantors or all or substantially all of the
                               Collateral (other than as permitted under the
           Secured Credit Facility).

Assignments and                                                                 
Participations:                  The Lenders shall be permitted to assign and   
                        sell participations in their loans and
                      commitments, subject, in the case of
                              assignments (other than to another Lender or
                              to an affiliate of a Lender), to the consent
                            of the Administrative Agent (which consent
                              shall not be unreasonably withheld). Non-pro
                             rata assignments shall be permitted. In the
                            case of partial assignments (other than to
                        another Lender or to an affiliate of a
                              Lender), the minimum assignment amount shall
                              be $5,000,000 unless otherwise agreed by the
                               Administrative Agent. Participants shall have
                               the same benefits as the Lenders with respect
                        to yield protection and increased cost
                           provisions. Voting rights of participants
                        shall be limited to those matters with
                              respect to which the affirmative vote of the
                    Lender from which it purchased its
                              participation would be required as described
                           under "Voting" above. Pledges of Loans in
                         accordance with applicable law shall be
                              permitted without restriction; provided that
                      no Lender shall be released from its
                               obligations under the Secured Credit Facility
                 as a result of any such pledge.

Yield Protection:                The Credit Documentation shall contain         
                         customary provisions (a) protecting the
                            Lenders against increased costs or loss of
                               yield resulting from changes in reserve, tax,
                            capital adequacy and other requirements of
                              law and from the imposition of or changes in
                    withholding or other taxes and (b)
                               indemnifying the Lenders for "breakage costs"

10  

EX-2
17th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 17th
                          incurred in connection with, among other
                             things, any prepayment of a LIBOR loan on a
                            day other than the last day of an Interest
              Period with respect thereto.

Expenses:                        All (a) reasonable legal and out-of-pocket     
                             expenses incurred by the Syndication Agent,
                              the Administrative Agent and the Arranger in
                        connection with the syndication of the
                              Secured Credit Facility and the preparation,
                            negotiation, execution and delivery of the
                        Credit Documentation and (b) legal and
                        out-of-pocket expenses incurred by the
                         Administrative Agent and the Lenders in
                               connection with the enforcement of the Credit
                              Documentation will be for the account of the
Borrower.     

Outside Counsel                                                                 
to the Arranger:                 Milbank, Tweed, Hadley & McCloy LLP.           

Governing Law:                   The State of New York.                         

EX-2
18th Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 18th
                                                        [Enlarge/Download Table]

                               Project Brickyard                                                                                   
             $175,000,000 3-Year Secured Revolving Credit Facility                                                                 
                                 Pricing Grid*                                                                                     


===================================================================================================================================
                        LEVEL 1                LEVEL 2                LEVEL 3                LEVEL 4                               

BASIS FOR          LT Senior Secured    LT Senior Secured       LT Senior Secured       LT Senior Secured       Rated Less Than    
PRICING            Bank Debt Rated      Bank Debt Rated         Bank Debt Rated         Bank Debt Rated         Level 4            
                   At Least BB+ By      Less Than Level 1       Less Level 2 But        Less Than Level 3                          
                   Standard & Poor's    But At Least BB By      At Least BB- By         But At Least B+                            
                   or Ba1 By Moody's    Standard & Poor's       Standard & Poor's       Standard & Poor's                          
                                        or Ba2 By Moody's.      or Ba3 By Moody's.      or B1 By Moody's.                          
===================================================================================================================================
                                                                                                                                   

COMMITMENT FEE (1)        37.5 bps               50.00 bps               50.00 bps               50.00bps                50.00 bps 
-----------------------------------------------------------------------------------------------------------------------------------

LC FEE                  175.00 bps              225.0 bps               275.00 bps              325.00 bps              400.00 bps 

-----------------------------------------------------------------------------------------------------------------------------------
EURODOLLAR                                                                                                                         
APPLICABLE MARGIN       175.00 bps              225.00 bps              275.00 bps              325.00 bps              400.00 bps 

-----------------------------------------------------------------------------------------------------------------------------------
BASE RATE                                                                                                                          
APPLICABLE MARGIN        75.00 bps              100.00 bps              150.00 bps              200.00 bps              275.00 bps 
-----------------------------------------------------------------------------------------------------------------------------------

         (1)      Paid quarterly in arrears on the unused amount of the Facility.                                                  

         bps = basis points per annum                                                                                              

         * Assuming a senior secured long-term debt rating of BB- or Ba3 on the Closing Date.                                      


EX-2
Last Page of 19
TOC
1st
Previous
Next
↓Bottom
Just 19th
                                                        [Enlarge/Download Table]


                                Project Brickyard                                                                                  
              $175,000,000 3-Year Secured Revolving Credit Facility                                                                
                                  Pricing Grid*                                                                                    

===================================================================================================================================
                              LEVEL 1                 LEVEL 2                        LEVEL 3                                       
BASIS FOR PRICING     LT Senior Secured       LT Senior Secured Bank      LT Senior Secured Bank Debt      Rated Less Than Level 3 
                      Bank Debt Rated At      Debt Rated Less Than        Rated Less Than Level 2 But                              
                      Least BB By Standard    Level 1 But At Least        At Least B+ By Standard &                                
                      & Poor's or Ba2 By      BB- By Standard & Poor's    Poor's or  B1  By Moody's.                               
                      Moody's.                or  Ba3  By Moody's.                                                                 
===================================================================================================================================
                                                                                                                                   

COMMITMENT FEE (1)            50.0 bps                  50.00 bps                 50.00 bps                     50.00 bps          

-----------------------------------------------------------------------------------------------------------------------------------

LC FEE                       225.00 bps                300.0 bps                 350.00 bps                    400.00 bps          

-----------------------------------------------------------------------------------------------------------------------------------
EURODOLLAR APPLICABLE                                                                                                              
MARGIN                       225.00 bps                300.00 bps                350.00 bps                    400.00 bps          

-----------------------------------------------------------------------------------------------------------------------------------
BASE RATE APPLICABLE                                                                                                               
MARGIN                       150.00 bps                175.00 bps                225.00 bps                    275.00 bps          
-----------------------------------------------------------------------------------------------------------------------------------

         (1)   Paid quarterly in arrears on the unused amount of the Facility.                                                     

         bps = basis points per annum                                                                                              

         * ASSUMING A SENIOR SECURED LONG TERM DEBT RATING OF B+ AND B1 ON THE CLOSING DATE                                        

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘SC 13D’ Filing		Date		First		Last			Other Filings
		12/31/02		11		12			10-K
		9/30/02		12					10-Q,  8-K
		6/30/02		12					10-Q
		3/31/02		12					10-Q
		10/31/01		2		8
Filed on:		6/21/01							DEFA14A
		6/18/01		1		6			3,  4,  8-K,  DEFA14A
		12/31/00		2		15			10-K,  10-K/A
									List all Filings