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Sample Business ContractsHome: Sample Business Contracts:
AIRBUS A350 PURCHASE AGREEMENT
Dated as of September 27, 2005
between
AVSA, S.A.R.L.,
Seller
and
US AIRWAYS, INC., AMERICA WEST AIRLINES, INC. and
US AIRWAYS GROUP, INC.
Buyers
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CONTENTS
CLAUSES TITLE
------- -----
0 DEFINITIONS
1 SALE AND PURCHASE
2 SPECIFICATION
3 PRICE
4 PRICE REVISION
5 PAYMENT TERMS
6 INSPECTION
7 CERTIFICATION
8 TECHNICAL ACCEPTANCE
9 DELIVERY
10 EXCUSABLE DELAY AND TOTAL LOSS
11 INEXCUSABLE DELAY
12 WARRANTIES AND SERVICE LIFE POLICY
13 PATENT AND COPYRIGHT INDEMNITY
14 TECHNICAL DATA
15 SELLER REPRESENTATIVES
16 TRAINING AND TRAINING AIDS
17 SUPPLIER PRODUCT SUPPORT
18 BUYER FURNISHED EQUIPMENT
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CLAUSES TITLE
------- -----
19 INDEMNITIES AND INSURANCE
20 ASSIGNMENTS AND TRANSFERS
21 TERMINATION EVENTS
22 MISCELLANEOUS PROVISIONS
23 CERTAIN REPRESENTATIONS OF THE PARTIES
EXHIBITS
--------
EXHIBIT A-1 A350-800 STANDARD SPECIFICATION
EXHIBIT A-2 A350-900 STANDARD SPECIFICATION
EXHIBIT B-1 SCN FORM
EXHIBIT B-2 MSCN FORM
EXHIBIT C SELLER SERVICE LIFE POLICY
EXHIBIT D CERTIFICATE OF ACCEPTANCE
EXHIBIT E BILL OF SALE
EXHIBIT F TECHNICAL DATA AND SOFTWARE SERVICES
EXHIBIT G SELLER PRICE REVISION FORMULA
EXHIBIT H TERMS AND CONDITIONS FOR LICENSE FOR USE OF SOFTWARE
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PURCHASE AGREEMENT
This Agreement is made this 27th day of September 2005
between
AVSA, S.A.R.L, a societe a responsabilite limitee organized and
existing under the laws of the Republic of France, having its
registered office located at
2, rond-point Maurice Bellonte
31700 Blagnac, France
(hereinafter referred to as the "SELLER")
and
US Airways, Inc., America West Airlines, Inc. and US Airways Group,
Inc., each a corporation organized and existing under the laws of
the State of Delaware, United States of America, and each having its
principal corporate offices located at 4000 East Sky Harbor
Boulevard, Phoenix, AZ 85034 (each hereinafter referred to as a
"BUYER" and, collectively, the "BUYERS").
WHEREAS, the Buyers wish to purchase and the Seller is willing to sell twenty
(20) Airbus A350 model aircraft, on the terms and conditions herein provided;
and
WHEREAS, the Seller is a sales subsidiary of Airbus S.A.S. and will purchase
such aircraft from Airbus S.A.S. for resale to the Buyers,
NOW THEREFORE IT IS AGREED AS FOLLOWS:
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0 DEFINITIONS
For all purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires, the following terms will have
the following meanings:
A350 Aircraft - any or all of the Airbus A350-800 Aircraft or A350-900
Aircraft.
A350-800 Aircraft - any or all of the Airbus A350-800 model aircraft to be
purchased by the Seller and sold to the Buyers pursuant to this Agreement,
together with all components, equipment, parts and accessories installed
in or on such aircraft and the Propulsion Systems installed thereon.
A350-900 Aircraft - any or all of the Airbus A350-900 model aircraft to be
purchased by the Seller and sold to the Buyers pursuant to this Agreement,
together with all components, equipment, parts and accessories installed
in or on such aircraft and the Propulsion Systems installed thereon.
A350-800 Specification - the A350-800 Standard Specification, as amended
from time to time in accordance with this Agreement.
A350-800 Standard Specification - the A350-800 standard specification
document number G.000.08000, Issue B, dated June 30, 2005, published by
the Manufacturer, which includes a maximum take-off weight ("MTOW") of 245
metric tons, a copy of which is annexed as Exhibit A-1.
A350-900 Specification - the A350-900 Standard Specification, as amended
from time to time in accordance with this Agreement.
A350-900 Standard Specification - the A350-900 standard specification
document number G.000.09000, Issue B, dated June 30, 2005, published by
the Manufacturer, which includes an MTOW of 245 metric tons, a copy of
which is annexed as Exhibit A-2.
Affiliate - with respect to any person or entity, any other person or
entity directly or indirectly controlling, controlled by or under common
control with such person or entity, but not, in the case of AVSA or the
Manufacturer, any of the Associated Contractors.
Agreement - this Airbus A350 purchase agreement dated as of the date
hereof, including exhibits and appendices attached hereto as the same may
be amended or modified and in effect from time to time.
Aircraft - any or all of the A350 Aircraft for which the delivery schedule
is set forth in Clause 9.1.1 hereof and any or all of any other aircraft
to be firmly sold by the Seller and firmly purchased by the Buyers
pursuant to this Agreement, together with all components, equipment, parts
and accessories installed in or on such aircraft and the Propulsion
Systems installed thereon upon Delivery.
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Airframe- any Aircraft, excluding the Propulsion Systems therefor.
ANACS - Airbus North America Customer Services, Inc., a corporation
organized and existing under the laws of Delaware, having an office
located at 198 Van Buren Street, Suite 300, Herndon, VA 20170, or any
successor thereto.
Associated Contractors - collectively, the following:
(1) Airbus France S.A.S., whose principal office is at
316, route de Bayonne
31060 Toulouse, France
(2) Airbus UK Ltd, whose principal office is at
New Filton House, Filton
Bristol, BS 997AR, Great Britain
(3) Airbus Espana S.L., whose principal office is at
Plaza de John Lennon N degrees 2,
s/n Getafe
28096 Madrid, Spain
(4) Airbus Deutschland GmbH, whose principal office is at
Kreetslag 10
21129 Hamburg, Germany
ATA Specification 100 - the specification issued by the Air Transport
Association of America relating to manufacturers' technical data.
ATA Specification 101 - the specification issued by the Air Transport
Association of America relating to ground equipment technical data.
ATA Specification 102 - the specification issued by the Air Transport
Association of America relating to software programs.
ATA Specification 200 - the specification issued by the Air Transport
Association of America relating to integrated data processing.
ATA Specification 300 - the specification issued by the Air Transport
Association of America relating to the packaging of spare parts shipments.
ATA Specification 2000 - the specification issued by the Air Transport
Association of America relating to an industry-wide communication system
linking suppliers and users for the purposes of spares provisioning,
purchasing, order administration, invoicing and information or data
exchange.
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ATA Specification 2100 - the specification issued by the Air Transport
Association of America relating to the standards for the presentation of
technical information prepared as digital media (magnetic tape or CD ROM).
ATA Specification 2200 - the specification issued by the Air Transport
Association of America relating to the preparation of technical
documentation in support of aircraft maintenance.
ATSB - The Air Transportation Stabilization Board.
Aviation Authority - when used with respect to any jurisdiction, the
government entity that, under the laws of such jurisdiction, has control
over civil aviation or the registration, airworthiness or operation of
civil aircraft in such jurisdiction.
Balance of the Final Contract Price - means the amount payable by the
Buyers to the Seller on the Delivery Date for an Aircraft after deducting
from the Final Contract Price for such Aircraft the amount of all
Predelivery Payments received by the Seller from the Buyers, or any of
them, in respect of such Aircraft on or before the Delivery Date for such
Aircraft.
Base Price - as defined in Clause 3.1.
Buyer Furnished Equipment or BFE - for any Aircraft, all the items of
equipment that will be furnished by the Buyers and installed in the
Aircraft by the Seller pursuant to Clause 18, as listed in the
Specification.
Certificate of Acceptance - as defined in Clause 8.3.
Change in Law - as defined in Clause 7.3.1.
Customer Originated Changes or COC - data originating from the Buyers, or
any of them, that are introduced into Seller's Technical Data and
Documentation, as more completely set forth in Clause 14.9.
Delivery - the transfer of title to the Aircraft from the Seller to the
Designated Buyers.
Delivery Date - the date on which Delivery occurs.
Delivery Location - the facilities of the Manufacturer at the location of
final assembly of the Aircraft, which is currently at the works of Airbus
France S.A.S. works in Toulouse, France.
Designated Buyer - as defined in Clause 9.
Development Changes - as defined in Clause 2.1.4.
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DGAC - the Direction Generale de l'Aviation Civile of France, or any
successor agency thereto.
EASA-European Aviation Safety Agency or any successor agency thereto.
Excusable Delay - as defined in Clause 10.1.
Export Certificate of Airworthiness - an export certificate of
airworthiness issued by the Aviation Authority of the Delivery Location.
FAA - the U.S. Federal Aviation Administration, or any successor agency
thereto.
Final Contract Price - as defined in Clause 3.2.
Free Carrier or FCA - as defined in Incoterms 2000: ICC Official Rules for
the Interpretation of Trade Terms, published by the International Chamber
of Commerce.
In-house Warranty Labor Rate - as defined in Clause 12.1.8(v).
In-house Warranty Repair - as referred to in Clause 12.1.8.
Initial Payment- each of the initial payment amounts described in Clause
5.3.
Interface Problem - as defined in Clause 12.4.1.
LIBOR - the London Interbank Offered Rate determined on the basis of the
offered rates for deposits in US dollars for each stated interest period
(or for six-month deposits in US dollars if no interest period is stated),
which appears on the Reuters Screen LIBO Page as of 11:00 a.m., London
time, on the second Working Day prior to the start of the relevant
interest period. If at least two (2) such offered rates appear on the
Reuters Screen LIBO Page, the rate for that interest period will be the
arithmetic mean of such offered rates rounded to the nearest one-hundred
thousandth of a basis point. If fewer than two (2) offered rates appear,
the rate for that interest period will be "LIBOR" as quoted by National
Westminster Bank, plc or any successor thereto. "Reuters Screen LIBO Page"
means the display designated as page "LIBO" on the Reuters Monitor Money
Rates Service (or any successor to such page or service).
Manufacturer - Airbus S.A.S., societe par actions simplifiee, of the
Republic of France.
Manufacturer Specification Change Notice or MSCN -as defined in Clause
2.1.3.
Predelivery Payment - any of the payments made in accordance with Clause
5.2.
Predelivery Payment Reference Price - as defined in Clause 5.2.2.
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Propulsion Systems - the two (2) General Electric GEnx-1A72 powerplants
installed on an Aircraft or to be installed on an Aircraft at Delivery,
each composed of the powerplant (as such term is defined in Chapters 70-80
of ATA Specification 100 (Revision 21), but limited to the equipment,
components, parts and accessories included in the powerplant, as so
defined) that have been sold to the Manufacturer by General Electric.
Ready for Delivery - with respect to any Aircraft, the term applicable to
such Aircraft when (i) the Technical Acceptance Process has been
successfully completed for such Aircraft and (ii) the Export Certificate
of Airworthiness has been issued therefor.
Resident Customer Support Representative - as set forth in Clause 15.2.1.
Scheduled Delivery Month - as defined in Clause 9.1.1.
SCN - as set forth in Clause 2.1.2
Seller Price Revision Formula - as set forth in Exhibit G.
Service Life Policy - as set forth to in Clause 12.2.
Software Products - software, whether bundled with data or not,
specifically designed to provide the Buyers with certain maintenance and
operation capabilities further detailed in the ANACS Customer Support
Catalog.
Specification - collectively or individually, as applicable, the A350-800
Specification or A350-900 Specification.
Specification Change Notice or SCN - as defined in Clause 2.1.2.
Supplier - any supplier of Supplier Parts.
Supplier Part - any component, equipment, accessory or part installed in
an Aircraft at the time of Delivery thereof, not including the Propulsion
Systems or Buyer Furnished Equipment, for which there exists a Supplier
Product Support Agreement.
Supplier Product Support Agreement - an agreement between the Manufacturer
and a Supplier containing enforceable and transferable warranties (and in
the case of landing gear suppliers, service life policies for selected
structural landing gear elements).
Technical Data - as set forth in Exhibit F.
Technical Acceptance Process - as defined in Clause 8.1.1.
Termination Event - as defined in Clause 21.1.
Training Conference - as defined in Clause 16.4.1.
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Type Certificate - as defined in Clause 7.1.
Warranted Part - as defined in Clause 12.1.1.
Warranty Claim - as defined in Clause 12.1.7(v).
Working Day - with respect to any action to be taken hereunder, a day
other than a Saturday, Sunday or other day designated as a holiday in the
jurisdiction in which such action is required to be taken.
The terms "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement, and not a particular Clause thereof. The
definition of a singular in this Clause will apply to plurals of the same
words.
Except for the purposes of and as provided in Clause 22.10, references in
this Agreement to an exhibit, schedule, article, section, subsection or
clause refer to the appropriate exhibit or schedule to, or article,
section, subsection or clause in this Agreement.
Except for the preceding sentence, each agreement defined in this Clause 0
will include all appendices, exhibits and schedules to such agreement. If
the prior written consent of any person is required hereunder for an
amendment, restatement, supplement or other modification to any such
agreement and the consent of each such person is obtained, references in
this Agreement to such agreement will be to such agreement as so amended,
restated, supplemented or modified.
References in this Agreement to any statute will be to such statute as
amended or modified and in effect at the time any such reference is
operative.
Technical and trade terms used but not defined herein will be defined as
generally accepted in the airline and/or aircraft manufacturing industries
or as otherwise described.
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1 SALE AND PURCHASE
The Seller will cause to be manufactured and will sell and deliver, and
the Buyer will purchase (from the Seller) and take delivery of the
Aircraft, subject to the terms and conditions in this Agreement.
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2 SPECIFICATION
2.1 Specification Documents
2.1.1 The Aircraft will be manufactured in accordance with the applicable
Specification.
2.1.2 Specification Change Notice
The Specification may be amended in writing by the Buyers and the Seller
by a Specification Change Notice in substantially the form set out in
Exhibit B-1 (each, an "SCN"). An SCN will set out the SCN's effectivity
and the particular change to be made to the Specification and the effect,
if any, of such change on design, performance, weight, Scheduled Delivery
Month of the Aircraft affected thereby, interchangeability or
replaceability requirements of the Specification and text of the
Specification. An SCN may result in an adjustment of the Base Price of the
Aircraft, which adjustment, if any, will be specified in the SCN. SCNs
will not be binding on either party until signed by persons duly
authorized by each of the Buyers and the Seller, but upon being so signed,
will constitute amendments to this Agreement.
2.1.3 [...***...]
2.1.4 Development Changes
As stated in Clause 2.1.3, changes may be made by the Seller without the
Buyers' consent when changes to the Aircraft that do not adversely affect
price, Scheduled Delivery Month, weight of the Aircraft affected thereby,
performance, interchangeability requirements or replaceability
requirements of the Specifications of the Aircraft affected thereby are
deemed by the Seller to be necessary to improve the Aircraft affected
thereby, prevent delay or ensure compliance with this Agreement
("DEVELOPMENT Changes"). Development Changes will be made by either an
MSCN or a manufacturer's information document prior to Delivery of the
relevant Aircraft.
*** Confidential Treatment Requested
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2.2 Customization Milestones Chart
Within a reasonable period after signature of this Agreement, the Seller
will provide the Buyers with a chart called the "Customization Milestones
Chart," defining the lead times before Delivery needed for agreeing on
items requested by the Buyers from the Standard Specifications and
Configuration Guides CD-ROM.
2.3 Propulsion Systems
Each Airframe will be equipped with a set of Propulsion Systems. Each
Airframe will be equipped with nacelles and thrust reversers.
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3 PRICE
3.1 Base Price of the Aircraft
3.1.1 Aircraft
3.1.1. The Base Price of each A350-800 Aircraft is the sum of
(i) [...***...]
(ii) [...***...]
3.1.2 The Base Price of each A350-900 Aircraft is the sum of
(i) [...***...]
(ii) [...***...]
3.2 The Final Contract Price of an Aircraft will be the sum of:
(i) the Base Price of the applicable Aircraft, adjusted to the Delivery
Date of such Aircraft in accordance with the Seller Price Revision
Formula, [...***...];
(ii) the price of any SCNs for the Aircraft entered into after the date
of signature of this Agreement, as adjusted to the Delivery Date in
accordance with the Seller Price Revision Formula; and
(iii) any other amount resulting from any other provisions of this
Agreement and/or any other written agreement between the Buyers and
the Seller relating to the Aircraft.
*** Confidential Treatment Requested
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3.3 Taxes, Duties and Imposts
3.3.1 [...***...]
3.3.2 [...***...]
*** Confidential Treatment Requested
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3.3.3 [...***...]
3.3.4 [...***...]
*** Confidential Treatment Requested
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4 PRICE REVISION
[...***...], the Base Price of the Aircraft is subject to revision up to
and including the Delivery Date, in accordance with the Seller Price
Revision Formula.
*** Confidential Treatment Requested
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5 PAYMENT TERMS
5.1 The Buyers will, jointly and severally, pay the Predelivery Payments, the
Balance of the Final Contract Price and any other amount due hereunder in
immediately available funds in United States dollars to the Seller's
account with CALYON New York, 1301 Avenue of the Americas, New York, or to
such other account within the United States as may be designated by the
Seller.
5.2 Predelivery Payments
5.2.1 Predelivery Payments are nonrefundable and will be paid by the Buyers,
jointly and severally, to the Seller for each Aircraft. [...***...] The
aggregate Predelivery Payment amount is thirty percent (30%) of the
Predelivery Payment Reference Price.
5.2.2 The Predelivery Payment Reference Price is:
A = Pb (1 + 0.04N)
where
A = the Predelivery Payment Reference Price
for an Aircraft to be delivered in calendar
year T.
Pb = the Base Price of the Aircraft.
N = (T - 2005).
T = the year of delivery of the relevant Aircraft.
5.2.3 Predelivery Payments will be paid according to the following schedule.
Percentage of Predelivery
Payment
Payment Date Reference Price
------------ -------------------------
1st Payment On signature of this Agreement [...***...]
No later than the first Working Day of the
following months:
2d Payment The thirty-sixth (36th) month before the [...***...]
Scheduled Delivery Month of each Aircraft as set
forth in this Agreement
*** Confidential Treatment Requested
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3d Payment The twenty-fourth (24th) month before the
Scheduled Delivery Month of each Aircraft as set 5%
forth in this Agreement
4th Payment The eighteenth (18th) month before the Scheduled 5%
Delivery Month of each Aircraft as set forth in
this Agreement
5th Payment The twelfth (12th) month before the Scheduled 5%
Delivery Month of each Aircraft as set forth in
this Agreement
6th Payment The sixth (6th) month before the Scheduled 5%
Delivery Month of each Aircraft as set forth in
this Agreement
TOTAL PAYMENT PRIOR TO DELIVERY 30%
All Predelivery Payments that are past due on signature of this Agreement
will be paid at signature of this Agreement.
5.2.4 The Seller will be entitled to hold and use any Predelivery Payment as
absolute owner thereof, subject only to the obligation to deduct
Predelivery Payments from the Final Contract Price when calculating the
Balance of the Final Contract Price. The Seller will be under no
obligation to segregate any Predelivery Payment, or any amount equal
thereto, from the Seller's funds.
5.2.5 SCN Predelivery Payment
[...***...]
(i) For each such SCN executed before the first day of the eighteenth
(18th) month before the Scheduled Delivery Month, the Buyers will,
jointly and severally, make a Predelivery Payment equal to fifteen
percent (15%) of the SCN price. This Predelivery Payment will be
paid on the first day of the twelfth (12th) month before the
Scheduled Delivery Month.
(ii) For each such SCN executed after the first day of the eighteenth
month (18th) and before the first day of the twelfth (12th) month
before the Scheduled Delivery Month, this Predelivery Payment will
amount to thirty percent (30%) of the SCN price, and for each SCN
executed after the first day of the twelfth (12th) month and before
the first day of the ninth (9th) month before the Scheduled Delivery
Month
*** Confidential Treatment Requested
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this payment will amount to fifty percent (50%) of the SCN price.
These payments will be paid on the first day of the sixth (6th)
month before the Scheduled Delivery Month.
5.3 Initial Payment
[...***...]
5.4 Payment of Balance of the Final Contract Price
Concurrent with each Delivery, the Buyers will, jointly and severally, pay
to the Seller the Balance of the Final Contract Price for the applicable
Aircraft. The Seller's receipt of the full amount of all Predelivery
Payments and of the Balance of the Final Contract Price, including any
amounts due under Clause 5.6, will be a condition precedent to the
Seller's obligation to deliver such Aircraft to the Designated Buyer.
5.5 Payment Setoff
Notwithstanding any other rights the Seller may have at contract or at
law, the Buyers and the Seller hereby agree that should any amount
(whether under this Agreement or under any other agreement between any
Buyer or any of their respective Affiliates and the Seller or any of its
Affiliates and whether at the stated maturity of such amount, by
acceleration or otherwise) become due and payable by such Buyer or its
Affiliates, and not be paid in full in immediately available funds on the
date due, then the Seller will have the right to debit and apply, in whole
or in part, the Predelivery Payments paid to the Seller by the Buyers
hereunder against such unpaid amount. The Seller will promptly notify the
Buyers in writing after such debiting and application.
5.6 Overdue Payments
If any payment due the Seller is not received by the Seller on the date or
dates agreed on between the Buyers and the Seller, the Seller will have
the right to claim from the Buyers and the Buyers will promptly pay to the
Seller on receipt of such claim [...***...] per annum on the amount of
such overdue payment, to be calculated from and including the due date of
such payment to (but excluding) the date such payment is received by the
Seller, on the basis of a 360-day year and the actual number of days
elapsed. The Seller's right to receive such interest will be in addition
to any other rights of the Seller hereunder or at law.
*** Confidential Treatment Requested
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5.7 Proprietary Interest
Notwithstanding any provision of law to the contrary, none of the Buyers
will, by virtue of anything contained in this Agreement (including,
without limitation, the making of any Predelivery Payments hereunder, or
any designation or identification by the Seller of a particular Aircraft
as an Aircraft to which any of the provisions of this Agreement refer)
acquire any proprietary, insurable or other interest whatsoever in any
Aircraft before Delivery of and payment for such Aircraft, as provided in
this Agreement.
5.8 Payment in Full
The Buyers' obligation to make payments to the Seller hereunder will not
be affected by and will be determined without regard to any setoff,
counterclaim, recoupment, defense or other right that any Buyer may have
against the Seller or any other person and all such payments will be made
without deduction or withholding of any kind. Each Buyer will ensure that
the sums received by the Seller under this Agreement will be equal to the
full amounts expressed to be due the Seller hereunder, without deduction
or withholding on account of and free from any and all taxes, levies,
imposts, duties or charges of whatever nature, except that if any Buyer is
compelled by law to make any such deduction or withholding, the Buyers
will, jointly and severally, pay such additional amounts to the Seller as
may be necessary so that the net amount received by the Seller after such
deduction or withholding will equal the amounts that would have been
received in the absence of such deduction or withholding.
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6 INSPECTION
6.1 Inspection Procedures
6.1.1 All work to be carried out on the Aircraft and all materials and parts
thereof will be open to inspection during business hours by duly
authorized representatives of the Buyers or their designee at the
respective works of the Associated Contractors and, if possible, at the
works of their respective subcontractors. These representatives will have
access to such relevant technical data as are reasonably necessary for
this purpose (except that, if access to any part of the respective works
where construction is in progress or materials or parts are stored is
restricted for security reasons, the Associated Contractors will be
allowed a reasonable time to make the items available for inspection
elsewhere). The actual detailed inspection of the Aircraft, materials and
parts thereof will take place only in the presence of the respective
inspection department personnel of the Associated Contractors or their
subcontractors. The procedures for such inspections will be agreed on with
the Buyers before any inspection. The Seller will ensure that such
personnel will be available at all reasonable times during business hours
as described above.
6.1.2 All inspections, examinations and discussions with the Seller's, the
Associated Contractors' or their respective subcontractors' engineering or
other personnel by the Buyers and their representatives will be performed
in such a manner as not to delay or hinder either the work to be carried
out on the Aircraft or the proper performance of this Agreement. In no
event will any of the Buyers or the representatives of any of them be
permitted to inspect any aircraft other than the Aircraft. The Seller will
not permit and will cause the Manufacturer not to permit, any
representatives, employees, agents or personnel of any airline or customer
of the Seller other than the Buyers to inspect, or to have access to the
Aircraft or any designs or specifications relating thereto, without the
prior written consent of the Buyers.
6.2 Representatives
For the purposes of Clause 6.1, starting at a mutually agreed date until
Delivery of the last Aircraft, the Seller will furnish free-of-charge
secretarial assistance and suitable space, office equipment and facilities
in or conveniently located with respect to the Delivery Location for the
use of not more than four (4) representatives of the Buyers during the
aforementioned period. The Seller will provide internet access, electronic
mail, facsimile and a telephone at the Buyers' cost to be invoiced on a
monthly basis.
6.3 The Seller will or will cause the Manufacturer to correct or otherwise
resolve any deviations from the Specification discovered during any
inspection or examination conducted under this Clause 6.
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7 CERTIFICATION
Except as set forth in this Clause 7, the Seller will not be required to
obtain any certificate or approval with respect to the Aircraft.
7.1 Type Certification
A type certificate will have been issued by each of EASA and the FAA in
the transport category (each, a "TYPE CERTIFICATE") prior to Delivery of
the first Aircraft.
7.2 Export Certificate of Airworthiness
Subject to the provisions of Clause 7.3, each Aircraft will be delivered
to the Buyers with an Export Certificate of Airworthiness issued by the
DGAC or EASA, as applicable, and in a condition enabling the Buyers (or an
eligible person under then applicable law) to obtain at the time of
Delivery a Standard Airworthiness Certificate issued pursuant to Part 21
of the US Federal Aviation Regulations and a Certificate of Sanitary
Construction issued by the U.S. Public Health Service Food and Drug
Administration. However, the Seller will have no obligation to make and
will not be responsible for any costs of alterations or modifications to
any Aircraft to enable such Aircraft to meet FAA or U.S. Department of
Transportation requirements for specific operation on the Buyers' routes,
except as may be provided pursuant to Clause 7.3, whether before, at or
after Delivery of any Aircraft.
7.3 Additional FAA Requirements
[...***...]
7.4 Additional EASA Requirements
7.4.1 [...***...]
7.4.2 [...***...]
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7.4.3 [...***...]
7.4.4 Notwithstanding the provisions of Clauses 7.4.3, if a Change in Law
relates to an item of BFE or to the Propulsion Systems (including to
engine accessories, quick engine change units or thrust reversers) the
costs relating thereto will be borne in accordance with such arrangements
as may be made separately between the Buyers and the manufacturer of the
BFE or the Propulsion Systems, as applicable, and the Seller will have no
obligation with respect thereto.
7.5 Specification Changes After Delivery
Nothing in Clause 7.4 will require the Seller to make any changes or
modifications to, or to make any payments or take any other action with
respect to, any Aircraft that is Ready for Delivery before the compliance
date of any law or regulation referred to in Clause 7.4. Any such changes
or modifications made to an Aircraft after it is Ready for Delivery will
be at the Buyers' expense.
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8 BUYER'S TECHNICAL ACCEPTANCE
8.1 Technical Acceptance Process
8.1.1 Prior to Delivery, the Aircraft will undergo a technical acceptance
process developed by the Seller, [...***...] (the "TECHNICAL ACCEPTANCE
PROCESS"). Completion of the Technical Acceptance Process will demonstrate
the satisfactory functioning of the Aircraft and will be deemed to
demonstrate compliance with the applicable Specification. Should it be
established that the Aircraft fails to complete the Technical Acceptance
Process satisfactorily, the Seller will without hindrance from the Buyers
be entitled to and will carry out any necessary changes to correct the
reason for such failure and, as soon as practicable thereafter, resubmit
the Aircraft in order to complete the Technical Acceptance Process.
8.1.2 The Technical Acceptance Process will
(i) start on a date notified by the Seller to the Buyers at least ten
(10) days in advance,
(ii) take place at the Delivery Location,
(iii) be carried out by the personnel of the Seller,
(iv) include a technical acceptance flight that will not exceed three (3)
hours, and
(v) conclude in nine (9) Working Days.
8.2 Buyers' Attendance
8.2.1 The Buyers are entitled to attend and observe the Technical Acceptance
Process.
8.2.2 If any of the Buyers attend the Technical Acceptance Process, each of them
(i) will comply with the reasonable requirements of the Seller, with the
intention of completing the Technical Acceptance Process within nine
(9) Working Days, and
(ii) may, collectively, have a maximum of four (4) representatives (no
more than three (3) of whom will have access to the cockpit at any
one time) accompany the Seller's representatives on the technical
acceptance flight, during which such Buyers' representatives will
comply with the instructions of the Seller's representatives.
8.2.3 If none of the Buyers attends or any of them fails to cooperate in the
Technical Acceptance Process, the Seller will be entitled to complete the
Technical Acceptance Process in compliance with Clause 8.1.1, without such
Buyer's attendance, and each of
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the Buyers will be deemed to have accepted that the Aircraft is
functioning satisfactorily and is in compliance with the Specification, in
all respects.
8.3 Certificate of Acceptance
Upon successful completion of the Technical Acceptance Process, each of
the Buyers will, on or before the Delivery Date, sign and deliver to the
Seller a certificate of acceptance in respect of the Aircraft in the form
of Exhibit D (the "CERTIFICATE OF ACCEPTANCE"). [...***...]
8.4 Finality of Acceptance
The Buyers' signature of the Certificate of Acceptance for the Aircraft
will constitute waiver by each of the Buyers of any right any of them may
have under the Uniform Commercial Code as adopted by the State of New York
or otherwise to revoke acceptance of the Aircraft for any reason, whether
known or unknown to any of the Buyers at the time of acceptance.
8.5 Aircraft Utilization
The Seller will, without payment or other liability, be entitled to use
the Aircraft [...***...] before Delivery to obtain
the certificates required under Clause 7. Such use will not limit the
Buyers' obligation to accept Delivery.
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9 DELIVERY
9.1 Delivery Schedule
9.1.1 Subject to any delay contemplated by Clauses 2, 7, 8, 10 and 18, the
Seller will have the Aircraft Ready for Delivery at the Delivery
Location within the following months (each a "SCHEDULED DELIVERY
MONTH").
Scheduled Delivery Month Year Quantity
------------------------ ---- --------
[...***...]
Total
9.1.2
9.1.2.1 [...***...]
9.1.2.2 [...***...]
9.1.2.3 [...***...]
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9.1.2.4 [...***...]
9.2. The Buyers will send their representatives to the Delivery Location to
take Delivery within seven (7) days after the date on which the
Aircraft is Ready for Delivery.
9.2.1 The Seller will transfer title to the Aircraft to [...***...] free and
clear of all encumbrances, provided that the Balance of the Final
Contract Price has been paid by the Buyers, or any of them, pursuant
to Clause 5.4 and that the Certificate of Acceptance has been signed
and delivered to the Seller pursuant to Clause 8.3. [...***...]
9.2.2 If (i) any Buyer fails to deliver the signed Certificate of Acceptance
to the Seller on or before the Delivery Date, or (ii) the Buyers fail
pay the Balance of the Final Contract Price for the Aircraft to the
Seller on the Delivery Date, then each of the Buyers will be deemed to
have rejected Delivery wrongfully when the Aircraft was duly tendered
pursuant to this Agreement. If such a deemed rejection arises, the
Seller will retain title to the applicable Aircraft and the Buyers
will, jointly and severally, indemnify and hold the Seller harmless
against any and all costs (including but not limited to any parking,
storage, and insurance costs) and consequences resulting from the
Buyers' rejection, it being understood that the Seller will be under
no duty to store, park, or otherwise protect the Aircraft. These
rights of the Seller will be in addition to the Seller's other rights
and remedies in this Agreement.
9.3 Flyaway
9.3.1 The Buyers and the Seller will cooperate to obtain any licenses that
may be required by the relevant Aviation Authority for the purpose of
exporting the Aircraft.
9.3.2 All expenses of, or connected with, flying the Aircraft from the
Delivery Location after Delivery will be borne by the Buyers. The
Buyers will make direct arrangements with the supplying companies for
the fuel and oil required for all delivery flights.
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10 EXCUSABLE DELAY AND TOTAL LOSS
10.1 Scope of Excusable Delay
Neither the Seller, the Manufacturer, the Associated Contractors, nor
any Affiliate of any of the foregoing, will be responsible for or be
deemed to be in default on account of delays in delivery or failure to
deliver or otherwise in the performance of this Agreement or any part
hereof due to causes reasonably beyond the Seller's, the
Manufacturer's or any Associated Contractor's control or not
occasioned by the Seller's, the Manufacturer's or any Associated
Contractor's fault or negligence ("EXCUSABLE DELAY"), including, but
not limited to: (i) acts of God or the public enemy, natural
disasters, fires, floods, storms beyond ordinary strength, explosions
or earthquakes; epidemics or quarantine restrictions; serious
accidents; total or constructive total loss; any law, decision,
regulation, directive or other act (whether or not having the force of
law) of any government or of the Council of the European Union or the
Commission of the European Union or of any national, Federal, State,
municipal or other governmental department, commission, board, bureau,
agency, court or instrumentality, domestic or foreign; governmental
priorities, regulations or orders affecting allocation of materials,
facilities or a completed Aircraft; war, civil war or warlike
operations, terrorism, insurrection or riots; failure of
transportation; strikes or labor troubles causing cessation, slow down
or interruption of work; inability after due and timely diligence to
procure materials, accessories, equipment or parts or to cause a
subcontractor or Supplier to furnish materials, components,
accessories, equipment or parts; general hindrance in transportation;
(ii) [...***...]; and
(iii) any delay caused directly or indirectly by the action or
inaction of any Buyer.
10.2 Consequences of Excusable Delay
10.2.1 If an Excusable Delay occurs,
(a) the Seller will
(i) notify the Buyers of such Excusable Delay as soon as
practicable after becoming aware of the same;
(ii) not be deemed to be in default in the performance of its
obligations hereunder as a result of such Excusable
Delay;
(iii) not be responsible for any damages arising from or in
connection with such Excusable Delay suffered or
incurred by any of the Buyers; and
(iv) subject to the provisions of Subclause 10.3 below, as
soon as practicable after the removal of the cause of
such Excusable Delay, resume performance of its
obligations under this Agreement and notify the Buyers
of the revised Scheduled Delivery Month; and
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(b) [...***...]
10.3 Termination on Excusable Delay
10.3.1 If any Delivery is delayed as a result of an Excusable Delay for a
period of [...***...] after the last day of the Scheduled Delivery
Month, then either party may terminate this Agreement with respect to
the affected Aircraft, by giving written notice the other party
[...***...] after the expiration of such [...***...] period.
10.3.2 If the Seller has not exercised its right to terminate pursuant to
Subclause 10.3.1 herein and if the Seller notifies the Buyers of a
revised Scheduled Delivery Month pursuant to Clause 10.2.1(iv), in
respect of a delay in Delivery of an Aircraft of [...***...], then the
Buyers may terminate this Agreement with respect to the affected
Aircraft. Termination will be made by giving written notice to the
other party [...***...] after the Buyers' receipt of the notice of a
revised Scheduled Delivery Month. Any termination pursuant to this
Clause 10.3.2 as to an Aircraft will discharge the obligations and
liabilities of the parties hereunder with respect to such Aircraft,
except that the Seller will [...***...] of such termination pay to an
account designated by each of the Buyers in writing an amount equal to
all Predelivery Payments made by the Buyers, or any of them, in
respect of such Aircraft, provided that none of the Buyers is in
default under this Agreement or any other agreement with the Seller
and/or its Affiliates.
10.3.3 If this Agreement is not terminated under the terms of Clause 10.3.1
or 10.3.2, then the Seller and the Buyers will mutually agree upon a
new Scheduled Delivery Month after the [...***...] period referred to
in Clause 10.3.1 or 10.3.2, and this new Scheduled Delivery Month will
be deemed to be an amendment to the applicable Scheduled Delivery
Month in Clause 9.1.1.
10.4 Total Loss, Destruction or Damage
If prior to Delivery, any Aircraft is lost, destroyed or in the
reasonable opinion of the Seller is damaged beyond economic repair
("TOTAL LOSS"), the Seller will notify the Buyers to this effect
within [...***...] of such occurrence. The Seller will include in said
notification (or as soon after the issue of the notice as such
information becomes available to the Seller) the earliest date
consistent with the Seller's other commitments and production
capabilities that an aircraft to replace the Aircraft may be delivered
to the Buyers and the Scheduled Delivery Month will be extended as
specified in the Seller's notice to accommodate the delivery of the
replacement aircraft. However, if the Scheduled Delivery Month is
extended to a month [...***...], then this Agreement will terminate
with respect to said Aircraft unless:
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(i) each of the Buyers notifies the Seller within [...***...]
of the date of receipt of the Seller's notice that it
desires the Seller to provide a replacement aircraft during
the month quoted in the Seller's notice; and
(ii) the parties execute an amendment to this Agreement recording
the variation in the Scheduled Delivery Month.
Nothing herein will require the Seller to manufacture and deliver a
replacement aircraft if such manufacture would require the
reactivation of its production line for the model or series of
aircraft that includes the Aircraft. Any termination pursuant to this
Clause 10.4 as to a particular Aircraft will discharge the obligations
and liabilities of the parties hereunder with respect to such
Aircraft, except that the Seller will [...***...] of such
termination pay to an account designated by each of the Buyers in
writing an amount equal to all Predelivery Payments made by the
Buyers, or any of them, in respect of such Aircraft, provided that
none of the Buyers is in default under this Agreement or any other
agreement with the Seller and/or its Affiliates.
10.5 REMEDIES
THIS CLAUSE 10 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE BUYERS
FOR DELAYS IN DELIVERY OR FAILURE TO DELIVER, OTHER THAN SUCH DELAYS
AS ARE COVERED BY CLAUSE 11, AND THE BUYER HEREBY WAIVES ALL RIGHTS TO
WHICH IT WOULD OTHERWISE BE ENTITLED IN RESPECT THEREOF, INCLUDING,
WITHOUT LIMITATION, ANY RIGHTS TO INCIDENTAL AND CONSEQUENTIAL DAMAGES
OR SPECIFIC PERFORMANCE. NONE OF THE BUYERS WILL BE ENTITLED TO CLAIM
THE REMEDIES AND RECEIVE THE BENEFITS PROVIDED IN THIS CLAUSE 10 WHERE
THE DELAY REFERRED TO IN THIS CLAUSE 10 IS CAUSED DIRECTLY OR
INDIRECTLY BY THE NEGLIGENCE OR FAULT OF ANY BUYER OR ITS
REPRESENTATIVES.
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11 INEXCUSABLE DELAY
11.1 Liquidated Damages
11.1.1 If
[...***...]
then such delay will be termed an "INEXCUSABLE DELAY." In the event of
an Inexcusable Delay, [...***...]
11.1.2 If
(i) an Aircraft is not Ready for Delivery [...***...]
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11.2 Renegotiation
If, as a result of an Inexcusable Delay, Delivery does not occur
[...***...] after the last day of the Scheduled Delivery Month, the
Buyers will have the right, exercisable by written notice given by
each of them to the Seller [...***...] to require from the Seller a
renegotiation of the Scheduled Delivery Month for the affected
Aircraft. Unless otherwise agreed between the Seller and the Buyers
during such renegotiation, the said renegotiation will not prejudice
the Buyers' right to receive liquidated damages in accordance with
Clause 11.1.
11.3 Termination
If, as a result of an Inexcusable Delay, Delivery does not or cannot
occur [...***...] and the parties have not renegotiated the Delivery
Date pursuant to Clause 11.2, then the Buyers collectively, on the one
hand, and the Seller, on the other, will have the right, exercisable
by written notice to the other party, given [...***...] to terminate
this Agreement in respect of the affected Aircraft. In the event of
termination, neither party will have any claim against the other,
except that the Seller will pay to an account designated in a writing
signed by each of the Buyers any amounts due pursuant to Clause 11.1
and will pay such account [...***...]
11.4 Setoff Payments
Notwithstanding anything to the contrary contained herein, before
being required to make any payments under Clauses 11.1 or 11.3 above,
the Seller will have the right to apply any and all sums previously
paid by the Buyers, or any of them, to the Seller with respect to an
Aircraft as to which this Agreement has been terminated to the payment
of any other amounts that any Buyer or any Affiliate of a Buyer owes
to the Seller or any Affiliate thereof under any agreement between
them.
11.5 REMEDIES
THIS CLAUSE 11 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE BUYERS
FOR DELAYS IN DELIVERY OR FAILURE TO DELIVER, OTHER THAN SUCH DELAYS
AS ARE COVERED BY CLAUSE 10, AND EACH OF THE BUYERS HEREBY WAIVES ALL
RIGHTS TO WHICH IT WOULD OTHERWISE BE ENTITLED IN RESPECT THEREOF,
INCLUDING WITHOUT LIMITATION ANY RIGHTS TO INCIDENTAL AND
CONSEQUENTIAL DAMAGES OR SPECIFIC PERFORMANCE. NONE OF THE BUYERS WILL
BE ENTITLED TO CLAIM THE REMEDIES AND RECEIVE THE BENEFITS PROVIDED IN
THIS
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CLAUSE 11 WHERE THE DELAY REFERRED TO IN THIS CLAUSE 11 IS CAUSED BY,
DIRECTLY OR INDIRECTLY, THE NEGLIGENCE OR FAULT OF ANY BUYER OR ITS
REPRESENTATIVES.
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12 WARRANTIES AND SERVICE LIFE POLICY
The Seller represents and warrants that the Manufacturer has provided
to the Seller the Warranty, Service Life Policy, Supplier Warranties
and Interface Commitment with respect to the Aircraft that are
reproduced below between the words QUOTE and UNQUOTE, subject to the
terms, conditions, limitations and restrictions (including, but not
limited to, the Exclusivity of Warranties and General Limitations of
Liability and Duplicate Remedies provisions) set forth below. The
Seller hereby assigns to the Buyers, and each of the Buyers hereby
accepts, all of the Seller's rights and obligations as the "Buyer"
under the said Warranty, Service Life Policy, Supplier Warranties and
Interface Commitment, and the Seller subrogates the Buyers to all such
rights and obligations in respect of the Aircraft. The Seller hereby
warrants to the Buyers that (i) it has all requisite authority to make
the foregoing assignment to and to effect the foregoing subrogation in
favor of the Buyers, (ii) such assignment and subrogation are
effective to confer on the Buyers all of the foregoing rights and
obligations of the Seller, (iii) the provisions so assigned are in
full force and effect and have not been amended prior to the date
hereof, and (iv) the Seller will not enter into any amendment of the
provisions so assigned without the prior written consent of each of
the Buyers.
QUOTE
12.1 WARRANTY
12.1.1 Nature of Warranty
Subject to the limitations and conditions hereinafter provided, and
except as provided in Clause 12.1.2, the Seller warrants to the Buyers
that each Aircraft and each Warranted Part will at the time of
Delivery hereunder be free from defects:
(i) in material,
(ii) in workmanship, including, without limitation, processes of
manufacture,
(iii) in design (including, without limitation, selection of
materials parts and components) having regard to the state
of the art at the date of such design, and
(iv) arising from failure to conform to the Specification, except
as to immaterial deviations from those portions of the
Specification that are expressly stated in the Specification
to be estimates or approximations or design aims.
For the purposes of this Agreement, the term "WARRANTED PART" will
mean any Seller proprietary component, equipment, accessory or part
that (a) is installed on or incorporated into an Aircraft at Delivery,
(b) is manufactured to the detail
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design of the Seller or a subcontractor of the Seller and (c) bears a
part number of the Seller at the time of Delivery.
12.1.2 Exceptions
The warranties set forth in Clause 12.1.1 will not apply to Buyer
Furnished Equipment, Propulsion Systems, or to any component,
accessory, equipment or part purchased by any Buyer or the Seller
[...***...] that is not a Warranted Part, provided, however, that:
(i) any defect in the Seller's workmanship in respect of the installation
of such items in or on the Aircraft, including any failure by the
Seller to conform to the installation instructions of the
manufacturers of such items that invalidates any applicable warranty
from such manufacturers, will constitute a defect in workmanship for
the purpose of this Clause 12.1 and be covered by the warranty set
forth in Clause 12.1.1(ii), and
(ii) any defect inherent in the Seller's design of the installation,
considering the state of the art at the date of such design, that
impairs the use or function of such items will constitute a defect in
design for the purposes of this Clause 12.1 and be covered by the
warranty set forth in Clause 12.1.1(iii).
12.1.3 Warranty Periods
The warranties described in Clauses 12.1.1 and 12.1.2 hereinabove will
be limited to those defects that become apparent within [...***...]
after Delivery of the affected Aircraft, (the "WARRANTY PERIOD").
12.1.4.1 Limitations of Warranty
(i) The Buyers' remedy and the Seller's obligation and liability
under Clauses 12.1.1 and 12.1.2 are limited to, at the Seller's
expense and option, the repair, replacement or correction of, or
the supply of modification kits rectifying the defect to any
defective Warranted Part, [...***...] However, the Seller may
furnish a credit to the Buyers, jointly, for the future purchase
of goods and services (not including Aircraft) equal to the price
at which the Buyers are then entitled to acquire a replacement
for the defective Warranted Part.
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(ii) [...***...]
(iii) [...***...]
12.1.5 Cost of Inspection
(i) In addition to the remedies set forth in Clauses 12.1.4(i) and
12.1.4(ii), the Seller will reimburse the direct labor costs
spent by the Buyers in performing inspections of the Aircraft
that are conducted:
(a) to determine whether a defect exists in any Warranted
Part within the Warranty Period; or
(b) pending the Seller's provision of a corrective technical
solution.
(ii) The Seller's liability under Clause 12.1.5(i) is subject to
the following conditions:
(a) such inspections are recommended by a Seller Service
Bulletin to be performed within the Warranty Period;
(b) the inspections are not performed during a scheduled
maintenance check recommended by the Seller's
Maintenance Planning Document; the labor rate for the
reimbursements will be the In-House Warranty Labor Rate,
and
(iii) [...***...]
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12.1.5 Warranty Claim Requirements
The Buyers' remedy and the Seller's obligation and liability under
this Clause 12.1, with respect to each claimed defect, are subject
to the following conditions precedent:
(i) the existence of a defect covered by the provisions of this
Clause 12.1,
(ii) the defect becomes apparent within the Warranty Period, except
as provided in Clause 12.1.4(iii),
(iii) a Buyer submits to the Seller evidence reasonably satisfactory
to the Seller that the claimed defect is due to a matter
covered under the provisions of this Clause 12, and that such
defect did not result from any act or omission of any of the
Buyers, including but not limited to, any failure to operate
and maintain the affected Aircraft or part thereof in
accordance with the standards set forth in Clause 12.1.11 or
from any act or omission of any third party,
(iv) a Buyer returns as soon as practicable the Warranted Part
claimed to be defective to the repair facilities designated by
the Seller, unless the Buyers elect to repair a defective
Warranted Part in accordance with the provisions of Clause
12.1.8,
(v) the Seller receives a "WARRANTY CLAIM" complying with the
provisions of Clause 12.1.7(v).
12.1.7 Warranty Administration
The warranties set forth in Clause 12.1 will be administered as
hereinafter provided:
(i) Claim Determination. Determination as to whether any claimed
defect in any Warranted Part entitles the Buyers to a remedy
under this Clause 12.1 will be made by the Seller, in
consultation with the Buyers, and will be based on claim
details, reports from the Seller's regional representative,
historical data logs, inspections, tests, findings during
repair, defect analysis and other relevant documents and
information.
(ii) Transportation Costs. [...***...]
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[...***...]
(iii) [...***...]
[...***...]
(iv) [...***...]
[...***...]
(v) [...***...]
(a) Description of the defect and any action taken
(b) Date of incident and/or removal
(c) Description of the Warranted Part claimed to be
defective
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(d) Part number
(e) Serial number (if applicable)
(f) Position on Aircraft, according to Catalog Sequence
Number of the Illustrated Parts Catalog, Aircraft
Maintenance Manual, Component Maintenance Manual or
Structural Repair Manual, as applicable
(g) Total flying hours or calendar times, as applicable, at
the date of appearance of a defect
(h) Time since last shop visit at the date of appearance of
defect
(i) Manufacturer's serial number (MSN) of the Aircraft
and/or its registration number
(j) Aircraft total flying hours and/or number of landings at
the date of appearance of defect
(k) Claim number
(l) Date of claim
(m) Date of delivery of an Aircraft or Warranted Part to the
Buyer
Warranty Claims are to be addressed as follows:
Airbus
Customer Services Directorate
Warranty Administration
Rond-Point Maurice Bellonte
B.P. 33
F-31707 Blagnac Cedex, France
(vi) Replacements. Replacements made pursuant to this Clause 12.1 will be
made within the lead time defined in the Seller's Spare Parts Price
Catalog. [...***...]. Replaced components, equipment,
accessories or parts will become the Seller's property.
Title to and risk of loss of any Aircraft, component, accessory,
equipment or part returned by any of the Buyers to the Seller will
at all times remain with such Buyer, except that (i) when the Seller
has possession of a returned Aircraft, component, accessory,
equipment or part to which any of the Buyers has title, the Seller
will have such responsibility therefor as is chargeable by law to a
bailee for hire, but the Seller will not be liable for loss of use,
and (ii) title to and risk of loss of a returned component,
accessory, equipment or part will pass to the Seller on shipment by
the Seller to a Buyer of any item furnished by the Seller to such
Buyer as a replacement therefor or on the Seller's issuance of a
credit with respect thereto. Upon the Seller's shipment to a Buyer
of any replacement component, accessory, equipment or part provided
by the Seller pursuant to this Clause 12.1,
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title to and risk of loss of such component, accessory, equipment or
part will pass to such Buyer.
(vii) Seller's Acceptance and Rejection. [...***...] The Seller will
provide reasonable written substantiation in case of rejection
of a Warranty Claim. The Buyers will pay the Seller (a)
reasonable inspection and test charges incurred by the Seller in
connection with the investigation and processing of a rejected
Warranty Claim, [...***...] and (b) all costs incurred by the
Seller including transportation to the ANACS Spares Center in
Ashburn, VA, insurance, and any other associated costs.
[...***...]
(viii) Inspection. The Seller will have the right to inspect the
affected Aircraft and documents and other records relating
thereto in the event of any claim under this Clause 12.1 on
reasonable prior written notice to the Buyers and such
inspection will not unreasonably interfere with the Buyers'
operation and personnel.
12.1.8 In-house Warranty
(i) Authorization. Each of the Buyers is hereby authorized to repair
Warranted Parts, subject to the terms of this Clause 12.1.8
("IN-HOUSE WARRANTY REPAIR"). [...***...], such Buyer will
notify the Resident Customer Support Representative of its
decision to perform any In-house Warranty Repairs before such
repairs are commenced. Such Buyer's notice will include
sufficient detail regarding the defect, estimated or actual
labor hours and material, as applicable, to allow the Seller to
ascertain the reasonableness of the estimate. [...***...] The
Seller will use reasonable efforts to ensure a prompt response
and will not unreasonably withhold authorization.
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(ii) Conditions of Authorization. The Buyers will be entitled to the
benefits under this Clause 12.1.8 for repair of Warranted Parts:
[...***...]
(iii) Seller's Rights. The Seller will have the right to require the
delivery to it of any Warranted Part, or any part removed
therefrom that is claimed to be defective, if, in the Seller's
judgment, the nature of the claimed defect requires technical
investigation. Such delivery will be subject to the provisions
of Clause 12.1.7(ii).
Subject to applicable safety rules, the Seller will have the right to
have a representative present as an observer during the disassembly,
inspection and testing of any Warranted Part claimed to be defective.
Such representatives will not unreasonably interfere with the Buyers'
operation and personnel.
(iv) In-house Warranty Claim Substantiation. Claims for In-house
Warranty Repair credit will comply with the requirements in
Warranty Claims under Clause 12.1.6(v) and in addition, to the
extent ascertainable, will include:
(a) A report of technical findings with respect to the
defect
(b) For parts required to remedy the defect
- part numbers,
- serial numbers (if applicable),
- description of the parts,
- quantity of parts,
- unit price of parts,
- related Seller's or third party's invoices (if
applicable),
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- total price of parts
(c) Detailed number of labor hours
(d) In-house Warranty Labor Rate
(e) Total claim amount
(v) Credit. The Buyers' sole remedy, and the Seller's sole
obligation and liability, in respect of In-house Warranty Repair
claims, will be a credit to the Buyers' account. Such credit
will be equal to the sum of the direct labor cost expended in
performing such repair and the direct cost of materials
incorporated in the repair. Such costs will be determined as set
forth below.
(a) To determine direct labor costs, only the labor hours
spent on access, disassembly, inspection, repair,
reassembly, and final inspection and test (including
flight tests necessary to complete such repair) of the
Warranted Part alone will be counted. The hours required
for maintenance work concurrently being carried out on
the Aircraft or Warranted Part will not be included.
(b) [...***...]
The In-house Warranty Labor Rate is subject to
adjustment annually by multiplying the same by the ratio
ECIn/ECIb. For the purposes of this Clause 12.1.8(v)
only, ECIn is equal to the Labor Index defined in the
Seller Price Revision Formula for January of the year in
which the hours are spent and ECIb is equal to such
Labor Index for January 2005.
(c) Direct material costs are determined by the prices at
which the Buyers, or any of them, acquired such
replacement material, excluding any parts and materials
used for overhaul furnished free of charge by the
Seller.
(vi) Limitation on Credit. The Buyers will in no event be credited
for repair costs (including labor and material) for any
Warranted Part if such repair
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costs exceed, in the aggregate, (x) [...***...] of
the Seller's then current catalog price for a replacement of
such Warranted Part or (y) those costs that would have resulted
if repairs had been carried out at the Seller's facilities.
The Seller will substantiate the costs referred to in Clause
12.1.8(vi)(y) in writing on reasonable request by the Buyers.
(vii) Scrapped Material. Each of the Buyers may, with the agreement of
the Resident Customer Support Representative, scrap any
defective Warranted Parts that are beyond economic repair and
not required for technical evaluation. If such Buyer does not
obtain the written agreement of the Resident Customer Support
Representative to scrap a Warranted Part, then such Buyer will
retain such Warranted Part and any defective part removed from a
Warranted Part during repair for a period of either one hundred
and [...***...] after the date of completion of repair or
[...***...] after submission of a claim for In-house Warranty
Repair credit relating thereto, whichever is longer. Such parts
will be returned to the Seller within [...***...] of receipt of
the Seller's request therefor, at the Seller's expense
(including costs relating to the fabrication of a shipping
container specifically required for this shipment only.)
(viii) DISCLAIMER OF SELLER LIABILITY FOR BUYER'S REPAIR
THE SELLER WILL NOT BE LIABLE FOR, AND EACH OF THE BUYERS WILL,
JOINTLY AND SEVERALLY, INDEMNIFY THE SELLER AGAINST, CLAIMS OF
ANY THIRD PARTIES FOR LOSSES DUE TO ANY DEFECT, NONCONFORMANCE
OR PROBLEM OF ANY KIND, ARISING OUT OF OR IN CONNECTION WITH ANY
REPAIR OF WARRANTED PARTS UNDERTAKEN BY ANY OF THE BUYERS UNDER
THIS CLAUSE 12.1.8 OR ANY OTHER ACTIONS UNDERTAKEN BY ANY OF THE
BUYERS UNDER THIS CLAUSE 12.1.8, WHETHER SUCH CLAIM IS ASSERTED
IN CONTRACT OR IN TORT, OR IS PREMISED ON ALLEGED, ACTUAL,
IMPUTED, ORDINARY OR INTENTIONAL ACTS OR OMISSIONS OF ANY BUYER
OR THE SELLER.
12.1.9 Warranty Transferability
The warranties provided for in this Clause 12.1 for any Warranted Part
will accrue to the benefit of any operator other than a Buyer if the
Warranted Part enters into the possession of such operator as a result
of a pooling agreement between such operator and a Buyer, in accordance
with the terms and subject to the limitations and exclusions of the
foregoing warranties and to applicable laws or regulations.
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12.1.10 Warranty for Corrected, Replacement or Repaired Warranted Parts
Whenever any Warranted Part that contains a defect for which the Seller
is liable under this Clause 12.1 has been corrected, repaired or
replaced pursuant to the terms of this Clause 12, the period of the
Seller's warranty with respect to such corrected, repaired or
replacement Warranted Part, will be the remaining portion of the
original Warranty Period in respect of such corrected, repaired or
replaced Warranted Part. If a defect is attributable to a defective
repair or replacement by any of the Buyers, a Warranty Claim with
respect to such defect will be rejected, notwithstanding any subsequent
correction or repair, and will immediately terminate the remaining
warranties under this Clause 12.1 in respect of the affected Warranted
Part.
12.1.11 Standard Airline Operation - Normal Wear and Tear
The Buyers' rights under this Clause 12.1 are subject to the Aircraft
and each component, equipment, accessory and part thereof being
maintained, overhauled, repaired and operated in accordance with FAA
regulations and the Buyers' FAA-approved maintenance program and
operating procedures.
The Seller's liability under this Clause 12.1 will not extend to normal
wear and tear nor, to the extent caused by any of the following, to:
(i) any Aircraft or component, equipment, accessory or part thereof
that has been repaired, altered or modified after Delivery in a
manner inconsistent with the requirements of the applicable
Aviation Authority or the aircraft repair manuals, as
applicable;
(ii) any Aircraft or component, equipment, accessory or part thereof
that has been operated in a damaged state; or
(iii) any component, equipment, accessory or part from which the
trademark, trade name, part or serial number or other
identification marks have been removed.
The limitations of the Seller's liability under this Clause 12.1.11
resulting from causes described in Clauses 12.1.11(i) and 12.1.11(ii)
will apply only to the extent the Seller submits reasonable evidence
that the defect arose from or was contributed to by such causes.
12.2 SELLER SERVICE LIFE POLICY
12.2.1 Scope and Definitions
In addition to the warranties set forth in Clause 12.1, the Seller
agrees that, should a Failure occur in any Item (as such terms are
defined below), then, subject to the
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general conditions and limitations set forth in Clause 12.2.4, the
provisions of this Clause 12.2 will apply.
For the purposes of this Clause 12.2,
(i) "ITEM" means any of the Seller components, equipment,
accessories or parts listed in Exhibit C that are installed on
an Aircraft at any time during the period of effectiveness of
the Service Life Policy as defined below in Clause 12.2.2;
(ii) "FAILURE" means any breakage of, or defect in, an Item that
(x) materially impairs the utility or safety of the Item,
(y) did not result from any breakage or defect in any other
Aircraft part or component or from any other extrinsic
force, and
(z) has occurred or can reasonably be expected to occur, but
does not necessarily occur, on a repetitive or fleetwide
basis.
The Seller's obligations under this Clause 12.2 are referred to as the
("SERVICE LIFE POLICY")
12.2.2 Periods and Seller's Undertaking
Subject to the general conditions and limitations set forth in Clause
12.2.4, the Seller agrees that if a Failure occurs in an Item within
[...***...] after the Delivery of the Aircraft on which such Item
is installed, the Seller will, at its discretion, as promptly as
practicable and for a price that reflects the Seller's financial
participation as hereinafter provided:
(i) design and furnish to the Buyers a terminating correction for
such Item and provide any parts required for such correction
(including Seller designed standard parts but excluding industry
standard parts), or
(ii) replace such Item.
12.2.3 Seller's Participation in the Cost
Any part or Item that the Seller is required to furnish to the Buyers
under this Service Life Policy will be furnished at the Seller's current
sales price therefor, less the Seller's financial participation, which
will be determined in accordance with the following formula:
P = C ( N - T ) / N
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where
P: financial participation of the Seller,
C: the Seller's then current sales price for the required Item or
required Seller designed parts,
T: total time in months since Delivery of the Aircraft in which the
Item subject to a Failure was originally installed, and
N: [...***...]
12.2.4 General Conditions and Limitations
12.2.4.1 Notwithstanding any provision of this Clause 12.2, during the Warranty
Period, all Items will be covered by the provisions of Clause 12.1 and
not by the provisions of this Clause 12.2.
12.2.4.2 The Buyers' remedies and the Seller's obligations and liabilities
under this Service Life Policy are subject to compliance by the Buyers
with the following conditions:
(i) The Buyers will generate maintain log books and other
historical records as required by the FAA, and will retain
the same for the duration of this Service Life Policy, with
respect to each Item adequate to enable the determination as
to whether the alleged Failure is covered by this Service
Life Policy and, if so, to allocate the portion of the cost
to be borne by the Seller in accordance with Clause 12.2.3.
(ii) The Buyers will keep the Seller informed, by making
available any relevant records upon request, of any
significant incidents relating to an Aircraft, howsoever
occurring or recorded.
(iii) The conditions of Clause 12.1.11 will have been complied
with.
(iv) The Buyers will implement specific structural inspection
programs for monitoring purposes as may be established from
time to time by the Seller and the Buyers. Such programs
will be, to the extent possible, compatible with the Buyers'
operational requirements and will be carried out at the
Buyers' expense. Reports relating thereto will be regularly
furnished to the Seller on a reasonable request.
(v) The Buyers will report in writing any breakage or defect
that may be covered by the Service Life Policy to the Seller
within [...***...] after such breakage or defect
becomes apparent, whether or not the same can reasonably be
expected to occur in any other Aircraft, and the Buyers
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will inform the Seller in sufficient detail about such
breakage or defect to enable the Seller to determine whether
the same is subject to this Service Life Policy.
12.2.4.3 Except as otherwise provided in this Clause 12.2, any claim under this
Service Life Policy will be administered as provided in, and will be
subject to the terms and conditions of, Clause 12.1.6.
12.2.4.4 If the Seller has issued a service bulletin modification applicable to
an Aircraft, the purpose of which is to avoid a Failure, the Seller
will offer the necessary modification kit free of charge or under a
pro rata formula established by the Seller. If such a kit is so
offered to the Buyers, then, in respect of such Failure and any
Failures that could ensue therefrom, the Seller's commitment under
this Clause 12.2 will be subject to the Buyers' incorporating such
modification in the relevant Aircraft, within a reasonable time, as
promulgated by the Seller and in accordance with the Seller's
instructions.
12.2.4.5 THIS SERVICE LIFE POLICY IS NEITHER A WARRANTY, PERFORMANCE GUARANTEE,
NOR AN AGREEMENT TO MODIFY ANY AIRCRAFT OR AIRFRAME COMPONENTS TO
CONFORM TO NEW DEVELOPMENTS OCCURRING IN THE STATE OF AIRFRAME DESIGN
AND MANUFACTURING ART. THE SELLER'S OBLIGATION UNDER THIS CLAUSE 12.2
IS TO MAKE ONLY THOSE CORRECTIONS TO THE ITEMS OR FURNISH REPLACEMENTS
THEREFOR AS PROVIDED IN THIS CLAUSE 12.2. THE BUYERS' SOLE REMEDY AND
RELIEF FOR THE NONPERFORMANCE OF ANY OBLIGATION OR LIABILITY OF THE
SELLER ARISING UNDER OR BY VIRTUE OF THIS SERVICE LIFE POLICY WILL BE
IN MONETARY DAMAGES, LIMITED TO THE AMOUNT THE BUYERS REASONABLY
EXPEND IN PROCURING A CORRECTION OR REPLACEMENT FOR ANY ITEM THAT IS
THE SUBJECT OF A FAILURE COVERED BY THIS SERVICE LIFE POLICY AND TO
WHICH SUCH NONPERFORMANCE IS RELATED, LESS THE AMOUNT THAT THE BUYERS
OTHERWISE WOULD HAVE BEEN REQUIRED TO PAY UNDER THIS CLAUSE 12.2 IN
RESPECT OF SUCH CORRECTED OR REPLACEMENT ITEM. WITHOUT LIMITING THE
EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY
PROVISIONS SET FORTH IN CLAUSE 12.5, EACH OF THE BUYERS HEREBY WAIVES,
RELEASES AND RENOUNCES ALL CLAIMS TO ANY FURTHER DIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, INCLUDING LOSS OF PROFITS AND ALL OTHER RIGHTS,
CLAIMS AND REMEDIES, ARISING UNDER OR BY VIRTUE OF THIS SERVICE LIFE
POLICY.
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12.2.5 Transferability
The Buyers' rights under this Clause 12.2 will not be assigned, sold,
transferred or otherwise alienated by operation of law or otherwise,
without the Seller's prior written consent.
Any unauthorized assignment, sale, transfer or other alienation of any
Buyer's rights under this Service Life Policy will, as to the Aircraft
involved, immediately void this Service Life Policy in its entirety.
12.3 SUPPLIER WARRANTIES AND SERVICE LIFE POLICIES
12.3.1 Seller's Support
Before Delivery of the first Aircraft, the Seller will provide the
Buyers with the warranties and service life policies that the Seller
has obtained pursuant to the Supplier Product Support Agreements.
12.3.2.1 Supplier's Default
12.3.2.1 If any Supplier under any warranty referred to in Clause 12.3.1
defaults in the performance of any material obligation under such
warranty with respect to a Supplier Part, each Buyer has used its best
efforts to enforce its rights under such warranty, and the Buyers
submit reasonable evidence, within a reasonable time, that such
default has occurred, then Clause 12.1 of this Agreement will apply to
the extent it would have applied had such Supplier Part been a
Warranted Part, to the extent the Seller can reasonably perform said
Supplier's obligations, except that the Supplier's warranty period
indicated in the applicable Supplier Product Support Agreement will
apply.
12.3.2.2 If any Supplier under any service life policy referred to in Clause
12.3.1 defaults in the performance of any material obligation under
such service life policy with respect to a Supplier Part, each Buyer
has used best efforts to enforce its rights under such service life
policy, and such Buyer submits within reasonable time to the Seller
reasonable evidence that such default has occurred, then Clause 12.2
will apply to the extent the same would have applied had such Supplier
Part been listed in Exhibit C, to the extent that the Seller can
reasonably perform said Supplier's service life policy.
12.3.2.3 At the Seller's request, each Buyer will assign to the Seller, and the
Seller will be subrogated to, all of the Buyers' rights against the
relevant Supplier with respect to, and arising by reason of, such
default and the Buyers will provide reasonable assistance to enable
the Seller to enforce the rights so assigned.
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12.4 INTERFACE COMMITMENT
12.4.1 Interface Problem
If any Buyer experiences any technical problem in the operation of an
Aircraft or its systems, the cause of which, after due and reasonable
investigation, is not readily identifiable by such Buyer, but which
such Buyer reasonably believes to be attributable to the design
characteristics of one or more components of the Aircraft and/or its
systems (an "INTERFACE PROBLEM"), the Seller will, if requested by
such Buyer, and without additional charge to any Buyer, promptly
conduct or have conducted an investigation and analysis of such
problem to determine, if possible, the cause or causes of the problem
and to recommend such corrective action as may be feasible, provided,
however, that if the Seller determines, after such investigation, that
the Interface Problem was due to or caused by any act or omission of
any Buyer in its performance of its obligations hereunder, the Buyers
will, jointly and severally, pay to the Seller all reasonable costs
and expenses incurred by the Seller during such investigation. The
Buyers will furnish to the Seller all data and information in the
possession of any of them relevant to the Interface Problem and will
reasonably cooperate with the Seller in the conduct of the Seller's
investigations and such tests as may be required. At the conclusion of
such investigation the Seller will promptly advise the Buyers in
writing of the Seller's opinion as to the cause or causes of the
Interface Problem and the Seller's recommendations as to corrective
action.
12.4.2 Seller's Responsibility
If the Seller determines that the Interface Problem is primarily
attributable to the design of a Warranted Part, the Seller will, if
requested by a Buyer, take prompt action to correct the design of such
Warranted Part, pursuant to the terms and conditions of Clause 12.1.
12.4.3 Supplier's Responsibility
If the Seller determines that the Interface Problem is primarily
attributable to the design of any Supplier Part, the Seller will at
any Buyer's request, assist such Buyer in processing any warranty
claim such Buyer may have against the manufacturer of such Supplier
Part. [...***...]
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12.4.4 Joint Responsibility
If the Seller determines that the Interface Problem is attributable
partially to the design of a Warranted Part and partially to the
design of any Supplier Part, the Seller will, if requested by a Buyer,
seek a solution to the Interface Problem through cooperative efforts
of the Seller and any Supplier(s) involved. The Seller will promptly
advise the Buyers of any corrective action proposed by the Seller and
any such Supplier(s). Such proposal will be consistent with any then
existing obligations of the Seller hereunder and of any such Supplier
to the Buyers. Such corrective action, unless reasonably rejected by
the Buyers, will constitute full satisfaction of any claim any of the
Buyers may have against either the Seller or any such Supplier(s) with
respect to such Interface Problem, unless such corrective action does
not resolve the Interface Problem.
12.4.5 General
12.4.5.1 All requests under this Clause 12.4 will be directed both to the
Seller and the affected Suppliers.
12.4.5.2 Except as specifically set forth in this Clause 12.4, this Clause 12.4
will not be deemed to impose on the Seller any obligations not
expressly set forth elsewhere in this Agreement.
12.4.5.3 All reports, recommendations, data and other documents furnished by
the Seller to a Buyer pursuant to this Clause 12.4 will be deemed to
be delivered under this Agreement and will be subject to the terms,
covenants and conditions set forth in this Clause 12 and in Clause
22.7.
12.5 EXCLUSIVITY OF WARRANTIES
THIS CLAUSE 12 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE EXCLUSIVE
WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE OBLIGATIONS OF THE
SELLER, AND THE EXCLUSIVE REMEDIES AVAILABLE TO ANY BUYER, WHETHER
UNDER THIS AGREEMENT OR OTHERWISE, ARISING FROM ANY DEFECT OR
NONCONFORMITY OR PROBLEM OF ANY KIND IN ANY AIRCRAFT, COMPONENT,
EQUIPMENT, ACCESSORY, PART, SOFTWARE, DATA OR SERVICE DELIVERED BY THE
SELLER UNDER THIS AGREEMENT.
EACH OF THE BUYERS RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES
IN THIS CLAUSE 12 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYERS
FROM ANY DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS
AND SERVICES SUPPLIED UNDER THIS AGREEMENT. EACH OF THE BUYERS HEREBY
WAIVES, RELEASES AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS,
GUARANTEES AND LIABILITIES OF
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THE SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES OF ANY BUYER
AGAINST THE SELLER, WHETHER EXPRESS OR IMPLIED BY CONTRACT, TORT, OR
STATUTORY LAW OR OTHERWISE, WITH RESPECT TO ANY NONCONFORMITY OR
DEFECT OR PROBLEM OF ANY KIND IN ANY AIRCRAFT, COMPONENT, EQUIPMENT,
ACCESSORY, PART, SOFTWARE, DATA OR SERVICE DELIVERED BY THE SELLER
UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO:
(1) ANY IMPLIED WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR
ANY GENERAL OR PARTICULAR PURPOSE;
(2) ANY IMPLIED OR EXPRESS WARRANTY ARISING FROM COURSE OF
PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE;
(3) ANY RIGHT, CLAIM OR REMEDY FOR BREACH OF CONTRACT;
(4) ANY RIGHT, CLAIM OR REMEDY FOR TORT, UNDER ANY THEORY OF
LIABILITY, HOWEVER ALLEGED, INCLUDING, BUT NOT LIMITED TO,
ACTIONS AND/OR CLAIMS FOR NEGLIGENCE, GROSS NEGLIGENCE,
INTENTIONAL ACTS, WILLFUL DISREGARD, IMPLIED WARRANTY,
PRODUCT LIABILITY, STRICT LIABILITY OR FAILURE TO WARN;
(5) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER THE UNIFORM
COMMERCIAL CODE OR ANY OTHER STATE OR FEDERAL STATUTE;
(6) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER ANY REGULATIONS OR
STANDARDS IMPOSED BY ANY INTERNATIONAL, NATIONAL, STATE OR
LOCAL STATUTE OR AGENCY;
(7) ANY RIGHT, CLAIM OR REMEDY TO RECOVER OR BE COMPENSATED FOR:
(a) LOSS OF USE OR REPLACEMENT OF ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY OR PART PROVIDED
UNDER THIS AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY OR PART PROVIDED
UNDER THIS AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
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(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE WARRANTIES AND SERVICE LIFE POLICY PROVIDED BY THIS AGREEMENT WILL
NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY A WRITTEN INSTRUMENT
SIGNED BY THE SELLER AND THE BUYERS. IF ANY PROVISION OF THIS CLAUSE
12 SHOULD FOR ANY REASON BE HELD UNLAWFUL, OR OTHERWISE UNENFORCEABLE,
THE REMAINDER OF THIS CLAUSE 12 WILL REMAIN IN FULL FORCE AND EFFECT.
FOR THE PURPOSE OF THIS CLAUSE 12.5, "SELLER" WILL BE UNDERSTOOD TO
INCLUDE THE SELLER, ITS AFFILIATES, SUPPLIERS AND ASSOCIATED
CONTRACTORS.
[...***...]
12.6 DUPLICATE REMEDIES
The remedies provided to the Buyers under this Clause 12 as to any
defect in respect of the Aircraft or any part thereof are mutually
exclusive and not cumulative. The Buyers will be entitled to the
remedy that provides the maximum benefit to them, as the Buyers may
elect, pursuant to the terms and conditions of this Clause 12 for any
defect for which remedies are provided under this Clause 12 provided,
however, that none of the Buyers will be entitled to elect a remedy
under more than one part of this Clause 12 for the same defect. The
Buyers' rights and remedies herein for the nonperformance of any
obligations or liabilities of the Seller arising under these
warranties will be in monetary damages limited to the amount the
Buyers expend in procuring a correction or replacement for any covered
part subject to a defect or nonperformance covered by this Clause 12,
and none of the Buyers will have any right to require specific
performance by the Seller.
UNQUOTE
In consideration of the assignment and subrogation by the Seller under
this Clause 12 in favor of the Buyers in respect of the Seller's
rights against and obligations to the Manufacturer under the
provisions quoted above, each of the Buyers hereby accepts such
assignment and subrogation and agrees to be bound by all of the terms,
conditions and limitations therein contained, specifically including,
without
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limitation, the Exclusivity of Warranties and General Limitations of
Liability provisions and Duplicate Remedies provisions.
THIS CLAUSE 12 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE EXCLUSIVE
WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE OBLIGATIONS OF THE
SELLER, AND THE EXCLUSIVE REMEDIES AVAILABLE TO THE BUYERS, WHETHER
UNDER THIS AGREEMENT OR OTHERWISE, ARISING FROM ANY DEFECT OR
NONCONFORMITY OR PROBLEM OF ANY KIND IN ANY AIRCRAFT, COMPONENT,
EQUIPMENT, ACCESSORY, PART, SOFTWARE, DATA OR SERVICE DELIVERED BY THE
SELLER UNDER THIS AGREEMENT.
EACH OF THE BUYERS RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES
IN THIS CLAUSE 12 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYERS
FROM ANY DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS
AND SERVICES SUPPLIED UNDER THIS AGREEMENT. EACH OF THE BUYERS HEREBY
WAIVES, RELEASES AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS,
GUARANTEES AND LIABILITIES OF THE SELLER AND ALL OTHER RIGHTS, CLAIMS
AND REMEDIES OF ANY BUYER AGAINST THE SELLER, WHETHER EXPRESS OR
IMPLIED BY CONTRACT, TORT, OR STATUTORY LAW OR OTHERWISE, WITH RESPECT
TO ANY NONCONFORMITY OR DEFECT OR PROBLEM OF ANY KIND IN ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY, PART, SOFTWARE, DATA OR SERVICE
DELIVERED BY THE SELLER UNDER THIS AGREEMENT, INCLUDING BUT NOT
LIMITED TO:
(1) ANY IMPLIED WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR
ANY GENERAL OR PARTICULAR PURPOSE;
(2) ANY IMPLIED OR EXPRESS WARRANTY ARISING FROM COURSE OF
PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE;
(3) ANY RIGHT, CLAIM OR REMEDY FOR BREACH OF CONTRACT;
(4) ANY RIGHT, CLAIM OR REMEDY FOR TORT, UNDER ANY THEORY OF
LIABILITY, HOWEVER ALLEGED, INCLUDING, BUT NOT LIMITED TO,
ACTIONS AND/OR CLAIMS FOR NEGLIGENCE, GROSS NEGLIGENCE,
INTENTIONAL ACTS, WILLFUL DISREGARD, IMPLIED WARRANTY,
PRODUCT LIABILITY, STRICT LIABILITY OR FAILURE TO WARN;
(5) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER THE UNIFORM
COMMERCIAL CODE OR ANY OTHER STATE OR FEDERAL STATUTE;
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(6) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER ANY REGULATIONS OR
STANDARDS IMPOSED BY ANY INTERNATIONAL, NATIONAL, STATE OR
LOCAL STATUTE OR AGENCY;
(7) ANY RIGHT, CLAIM OR REMEDY TO RECOVER OR BE COMPENSATED FOR:
(a) LOSS OF USE OR REPLACEMENT OF ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY PART, SOFTWARE OR
DATA PROVIDED UNDER THIS AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY, PART, SOFTWARE OR
DATA PROVIDED UNDER THIS AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE WARRANTIES AND SERVICE LIFE POLICY PROVIDED BY THIS AGREEMENT WILL
NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY A WRITTEN INSTRUMENT
SIGNED BY THE SELLER AND THE BUYERS. IN THE EVENT THAT ANY PROVISION
OF THIS CLAUSE 12 SHOULD FOR ANY REASON BE HELD UNLAWFUL, OR OTHERWISE
UNENFORCEABLE, THE REMAINDER OF THIS CLAUSE 12 WILL REMAIN IN FULL
FORCE AND EFFECT.
The remedies provided to the Buyers under this Clause 12 as to any
defect in respect of the Aircraft or any part thereof are mutually
exclusive and not cumulative. The Buyers will be entitled to the
remedy that provides the maximum benefit to them, as the Buyers may
elect, pursuant to the terms and conditions of this Clause 12 for any
defect for which remedies are provided under this Clause 12, provided,
however, that the none of the Buyers will be entitled to elect a
remedy under more than one part of this Clause 12 for the same defect.
The Buyers' rights and remedies herein for the nonperformance of any
obligations or liabilities of the Seller arising under these
warranties will be in monetary damages limited to the amount the
Buyers expend in procuring a correction or replacement for any covered
part subject to a defect or nonperformance covered by this Clause 12,
and none of the Buyers will have any right to require specific
performance by the Seller.
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12.7 NEGOTIATED AGREEMENT
Each of the Buyers specifically recognizes that:
(i) the Specification has been agreed upon after careful
consideration by the Buyers using their judgment as
professional operators of, and maintenance providers with
respect to, aircraft used in public transportation and as such
is are professionals within the same industry as the Seller;
(ii) this Agreement, and in particular this Clause 12, has been the
subject of discussion and negotiation and is fully understood
by the Buyers;
(iii) the price of the Aircraft and the other mutual agreements of
the Buyers set forth in this Agreement were arrived at in
consideration of, inter alia, the provisions of this Clause
12, specifically including the Exclusivity of Warranties set
forth in Clause 12.5.
12.8 SURVIVABILITY
[...***...]
*** Confidential Treatment Requested
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13. PATENT AND COPYRIGHT INDEMNITY
The Seller represents and warrants that the Manufacturer has
provided to the Seller the following indemnity against patent and
copyright infringements with respect to the Aircraft that are
reproduced below between the words QUOTE and UNQUOTE, subject to the
terms, conditions, limitations and restrictions (including, but not
limited to, the Exclusivity of Warranties and General Limitations of
Liability and Duplicate Remedies provisions) set forth below. The
Seller hereby assigns to the Buyers, and each of the Buyers hereby
accepts, all of the Seller's rights and obligations as the "Buyer"
under the said indemnity against patent and copyright infringements,
and the Seller subrogates the Buyers to all such rights and
obligations in respect of the Aircraft. The Seller hereby warrants
to the Buyers that (i) it has all requisite authority to make the
foregoing assignment to and to effect the foregoing subrogation in
favor of the Buyers, (ii) such assignment and subrogation are
effective to confer on the Buyers all of the foregoing rights and
obligations of the Seller, (iii) the provisions so assigned are in
full force and effect and have not been amended prior to the date
hereof, and (iv) the Seller will not enter into any amendment of the
provisions so assigned without the prior written consent of each of
the Buyers.
QUOTE
13.1 Indemnity
13.1.1 Subject to the provisions of Clause 13.2.3, the Seller will
indemnify the Buyers from and against any damages, costs and
expenses including legal costs (excluding damages, costs, expenses,
loss of profits and other liabilities in respect of or resulting
from loss of use of the Aircraft) resulting from any infringement or
claim of infringement by the Airframe or any part or software
installed therein at Delivery of
(i) any British, French, German, Spanish or U.S. patent;
(ii) any patent issued under the laws of any other country in which
any of the Buyers may lawfully operate the Aircraft, provided
that from the time of design of such Airframe or any part or
software installed therein at Delivery and until infringement
claims are resolved, the country of the patent and the flag
country of the Aircraft are both parties to:
(1) the Chicago Convention on International Civil Aviation
of December 7, 1944, and are each fully entitled to all
benefits of Article 27 thereof, or,
(2) the International Convention for the Protection of
Industrial Property of March 20, 1883; and
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(iii) in respect of computer software installed on the Aircraft, any
copyright, provided that the Seller's obligation to indemnify
will be limited to infringements in countries which, at the
time of infringement, are members of The Berne Union and
recognize computer software as a "work" under the Berne
Convention.
13.1.2 Clause 13.1.1 will not apply to
(i) Buyer Furnished Equipment;
(ii) the Propulsion Systems;
(iii) Supplier Parts; or
(iv) software not developed by the Seller.
13.1.3 If any of the Buyers is, due to circumstances contemplated in Clause
13.1.1, prevented from using the Aircraft (whether by a valid
judgment of a court of competent jurisdiction or by a settlement
arrived at among the claimant, the Seller and any Buyer), the Seller
will at its expense either
(i) procure for the Buyers the right to use the affected Airframe,
part or software free of charge; or
(ii) replace the infringing part or software as soon as possible
with a non-infringing substitute.
13.2 Administration of Patent and Copyright Indemnity Claims
13.2.1 If any Buyer receives a written claim or a suit is threatened or
begun against such Buyer for infringement of a patent or copyright
referred to in Clause 13.1, such Buyer will
(i) forthwith notify the Seller, giving particulars thereof;
(ii) furnish to the Seller all data, papers and records within the
Buyers' control or possession relating to such patent or
claim;
(iii) refrain from admitting any liability or making any payment, or
assuming any expenses, damages, costs or royalties, or
otherwise acting in a manner prejudicial to the defense or
denial of the suit or claim, it being agreed that nothing in
this Clause 13.2.1(iii) will prevent a Buyer from paying the
sums that may be required to obtain the release of the
Aircraft, provided that payment is accompanied by a denial of
liability and is made without prejudice;
(iv) fully cooperate with, and render all assistance to, the Seller
as may be pertinent to the defense or denial of the suit or
claim; and
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(v) act to mitigate damages and/or to reduce the amount of
royalties that may be payable, and act to minimize costs and
expenses.
13.2.2.1 The Seller will be entitled either in its own name or on behalf of
each of the Buyers to conduct negotiations with the party or parties
alleging infringement and may assume and conduct the defense or
settlement of any suit or claim in the manner that, in the Seller's
opinion, it deems proper.
13.2.3 The Seller's liability hereunder will be conditional on the strict
and timely compliance by each of the Buyers with the terms of this
Clause and is in lieu of any other liability to any Buyer, whether
express or implied, that the Seller might incur at law as a result
of any infringement or claim of infringement of any patent or
copyright.
UNQUOTE
In consideration of the assignment and subrogation by the Seller under
this Clause 13 in favor of the Buyers in respect of the Seller's rights
against and obligations to the Manufacturer under the provisions quoted
above, each of the Buyers hereby accepts such assignment and subrogation
and agrees to be bound by all of the terms, conditions and limitations
therein contained (specifically including, without limitation, the waiver,
release and renunciation provision).
THE INDEMNITY PROVIDED IN THIS CLAUSE 13 AND THE OBLIGATIONS AND
LIABILITIES OF THE SELLER UNDER THIS CLAUSE 13 ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND EACH OF THE BUYERS HEREBY WAIVES, RELEASES AND
RENOUNCES ALL OTHER INDEMNITIES, WARRANTIES, OBLIGATIONS, GUARANTEES AND
LIABILITIES ON THE PART OF THE SELLER AND RIGHTS, CLAIMS AND REMEDIES OF
ANY BUYER AGAINST THE SELLER, EXPRESS OR IMPLIED, ARISING BY LAW OR
OTHERWISE (INCLUDING WITHOUT LIMITATION ANY OBLIGATION, LIABILITY, RIGHT,
CLAIM OR REMEDY ARISING FROM OR WITH RESPECT TO LOSS OF USE OR REVENUE OR
CONSEQUENTIAL DAMAGES), WITH RESPECT TO ANY ACTUAL OR ALLEGED PATENT
INFRINGEMENT OR THE LIKE BY ANY AIRFRAME, PART OR SOFTWARE INSTALLED
THEREIN AT DELIVERY, OR THE USE OR SALE THEREOF, PROVIDED THAT, IN THE
EVENT THAT ANY OF THE AFORESAID PROVISIONS SHOULD FOR ANY REASON BE HELD
UNLAWFUL OR OTHERWISE INEFFECTIVE, THE REMAINDER OF THIS CLAUSE WILL
REMAIN IN FULL FORCE AND EFFECT. THIS INDEMNITY AGAINST PATENT AND
COPYRIGHT INFRINGEMENTS WILL NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY
A WRITTEN INSTRUMENT SIGNED BY THE SELLER AND THE BUYERS.
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14 TECHNICAL DATA AND SOFTWARE SERVICES
The Seller will make available or will cause the Seller's designee
ANACS to make available to the Buyers the Technical Data and certain
additional services under the terms and conditions set forth in this
Clause 14.
14.1 Supply
The Technical Data will be supplied in the English language using
the aeronautical terminology in common use.
Range, form, type, format, Air Transport Association ("ATA")
compliance or non-compliance, quantity and delivery schedule of the
Technical Data to be provided under this Agreement are covered in
Exhibit F. [...***...]
The Buyers will not receive compensation or credits of any kind for
return of unused or partially used Technical Data.
14.2 Aircraft Identification for Technical Data
14.2.1 For Technical Data customized to the Aircraft, the Buyers agree to
the allocation of fleet serial numbers ("FSN(S)") in the form of
block of numbers selected in the range from 001 to 999.
14.2.2 The sequence will not be interrupted except if two (2) different
Propulsion Systems or two (2) different Aircraft models are
selected.
14.2.3 The Buyers will indicate to the Seller the FSNs allocated to each
Aircraft corresponding to the Aircraft rank in the delivery schedule
set forth in Clause 9.1.1 not later than twenty-four (24) months
prior to the Scheduled Delivery Month for the first Aircraft to be
delivered hereunder. The allocation of such FSNs to such Aircraft
will not constitute any proprietary, insurable or other interest of
any Buyer in any Aircraft prior to its Delivery.
14.3 Integration of Equipment Data
14.3.1 Supplier Equipment
If necessary for the understanding of the affected systems,
information relating to Supplier Equipment that is installed on the
Aircraft by the Seller, will be introduced free of charge into the
first issue, subsequent to the installation of th |
