A320 Purchase Agreement - AVSA SARL and New Air Corp.
AIRBUS A320 PURCHASE AGREEMENT
Dated as of April 20, 1999
between
AVSA. S.A.R.L.,
SELLER
and
NEW AIR CORPORATION
BUYER
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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; PLANT REPRESENTATIVES
7 CERTIFICATION
8 BUYERS 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 AND DOCUMENTATION
15 FIELD ASSISTANCE
16 TRAINING AND TRAINING AIDS
17 EQUIPMENT SUPPLIER PRODUCT SUPPORT
18 BUYER FURNISHED EQUIPMENT AND DATA
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CONTENTS
CLAUSES TITLE
19 INDEMNITIES AND INSURANCE
20 ASSIGNMENTS AND TRANSFERS
21 TERMINATION EVENTS
22 MISCELLANEOUS PROVISIONS
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CONTENTS
EXHIBITS
EXHIBIT A STANDARD SPECIFICATION
APPENDIX I TO SCNs
EXHIBIT A
EXHIBIT B SCN FORM
EXHIBIT C SELLER SERVICE LIFE POLICY
EXHIBIT D CERTIFICATE OF ACCEPTANCE
EXHIBIT E BILL OF SALE
EXHIBIT F TECHNICAL DATA AND DOCUMENTATION
APPENDIX I TO LICENSE FOR USE OF THE PERFORMANCE ENGINEER'S
EXHIBIT F PROGRAM
APPENDIX 2 TO LICENSE FOR USE OF CD-ROM
EXHIBIT F
EXHIBIT G AIRFRAME PRICE REVISION FORMULA
EXHIBIT H INTERNATIONAL AERO ENGINES PRICE REVISION FORMULA
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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:
A320 ADDITIONAL OPTION AIRCRAFT -- up to twenty-five (25) A320-200 model
aircraft other than Firm Aircraft and Option Aircraft that may be
purchased by the Seller and sold to the Buyer 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.
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, not including any of the Associated
Contractors.
AGREEMENT -- this Airbus A320 Purchase Agreement, including all exhibits
and appendixes attached hereto, as the same may be amended or modified and
in effect from time to time.
AIRCRAFT -- any or all of the Firm Aircraft or Option Aircraft that have
been converted to a firm order, to be sold by the Seller and purchased by
the Buyer pursuant to this Agreement, together with all components,
equipment, parts and accessories installed in or on such aircraft and the
Propulsion Systems installed thereon on delivery.
AIRFRAME -- any Aircraft, excluding the Propulsion Systems therefor.
AIRFRAME PRICE REVISION FORMULA -- the airframe price revision formula set
forth in Exhibit G hereto.
ASCO -- Airbus Service Company, Inc., a corporation organized and existing
under the Laws of Delaware, having its registered office located at 198
Van Buren Street, Suite 300, Herndon, VA 20170, or any successor thereto.
ASSOCIATED CONTRACTORS -- collectively, the members and, for certain
purposes, subcontractors of the Manufacturer from time to time, which
members presently are:
(1) AEROSPATIALE, SOCIETE NATIONALE INDUSTRIELLE
("Aerospatiale"), whose principal office is at
37, Boulevard de Montmorency
75016 Paris
France
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(2) BRITISH AEROSPACE (OPERATIONS) LTD, whose principal office is
at
Warwick House
P0 Box 87
Farnborough Aerospace Centre
Farnborough
Hants GU14 6YU
England
(3) CONSTRUCCIONES AERONAUTICAS, S.A., whose principal office is
at
404 Avenida de Aragon
28022 Madrid
Spain
(4) DAIMLERCHRYSLER AEROSPACE AIRBUS, GmbH ("DASA"),
whose principal office is at
Kreetslag 10
Postfach 95 01 09
21111 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.
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).
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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
Buyer 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 Buyer in respect of
such Aircraft on or before the Delivery Date for such Aircraft.
BASE PRICE -- for any Aircraft, Airframe or Propulsion Systems, as more
completely defined in Clause 3.1 of this Agreement.
BUYER FURNISHED EQUIPMENT (BFE) -- for any Aircraft, all the items of
equipment that will be furnished by the Buyer and installed in the
Aircraft by the Seller, as defined in the Specification.
CUSTOMER ORIGINATED CHANGES (COC) -- Buyer-originated data that are
introduced into Seller's Technical Data and Documentation, as more
completely set forth in Clause 14.4.3 of this Agreement.
DELIVERY -- the transfer of title to the Aircraft from the Seller to the
Buyer, in accordance with Clause 9.
DELIVERY DATE -- the date on which Delivery will occur.
DELIVERY LOCATION -- the facilities of the Seller at the location of final
assembly of the Aircraft, which is currently at Aerospatiale's works in
Toulouse, France, for the A320 model aircraft, and at DASA's works in
Hamburg, Germany, for the A319 and A321 model aircraft.
DEVELOPMENT CHANGES -- as defined in Clause 2.1.3 of this Agreement.
DGAC -- the Direction Generale de l'Aviation Civile of France, or any
successor thereto.
EXCUSABLE DELAY -- delay in delivery or failure to deliver an Aircraft due
to causes specified in Clause 10.1 of this Agreement.
EXPORT AIRWORTHINESS CERTIFICATE -- an export certificate of airworthiness
issued by the Aviation Authority of the Delivery Location.
FAA -- the U.S. Federal Aviation Administration, or any successor thereto.
FINAL CONTRACT PRICE -- as defined in Clause 3.2 of this Agreement.
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FIRM AIRCRAFT -- any or all of the twenty-five (25) firm A320-200 aircraft
for which the delivery schedule is set forth in Clause 9.1.1 hereof to be
sold by the Seller and purchased by the Buyer 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.
FREE CARRIER (FCA) -- defined in the April 1990 edition of publication No.
460, published by the International Chamber of Commerce.
IN-HOUSE WARRANTY -- as referred to in Clause 12.1.7 of this Agreement.
IN-HOUSE WARRANTY LABOR RATE -- as defined in Clause 12.1.7(v) of this
Agreement.
INTERFACE PROBLEM -- as defined in Clause 12.4.1 of this Agreement.
JAA -- Joint Aviation Authorities or any successor thereto.
LBA -- Luftfahrt-Bundesamt of Germany or any successor thereto.
LIBOR -- for each stated interest period, the rate determined on the basis
of the offered rates for deposits in US dollars, which appear on the
Reuters Screen LIBO Page as of 11:00 a.m., London time, on the day that is
two (2) days (other than a Saturday, Sunday or a day that is a legal
holiday or a day on which banking institutions are authorized to close in
the City of New York, New York, London, England, or Paris, France) before
the first day of an 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 basis point (0.5 rounds to 1). If only one (1) offered rate
appears, the rate for that interest period will be "LIBOR" as quoted by
National Westminster Bank, plc. "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 Industrie, a "GROUPEMENT D'INTERET ECONOMIQUE"
established under "ORDONNANCE" No. 67-821 dated September 23, 1967, of the
Republic of France.
OPTION AIRCRAFT -- any or all of the twenty-five (25) A320-200 aircraft on
option order, which may be sold by the Seller and purchased by the Buyer
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.
PREDELIVERY PAYMENT -- any payment made against the Final Contract Price
of an Aircraft according to the schedule set forth in Clause 5.2.3 of this
Agreement.
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PREDELIVERY PAYMENT REFERENCE PRICE -- as defined in Clause 5.2.2 of this
Agreement.
PROPULSION SYSTEMS -- the two (2) International Aero Engines V2527-A5
powerplants 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 International Aero Engines.
PROPULSION SYSTEMS PRICE REVISION FORMULA -- the Propulsion Systems price
revision formula set forth in Exhibit H hereto.
READY FOR DELIVERY -- the time when (i) the Technical Acceptance Process
has been successfully completed and (ii) the Export Airworthiness
Certificate has been issued.
REFERENCE PRICE -- as set forth in Clause 3.1.2 of the Agreement.
SCHEDULED DELIVERY MONTH -- as defined in Clause 9.1.1 of the Agreement.
SCN PREDELIVERY PAYMENT -- any payment made against the SCN price
according to the schedule set forth in Clause 5.2.5 of this Agreement.
SERVICE LIFE POLICY -- as referred to in Clause 12.2 of this Agreement.
SPECIFICATION -- the Standard Specification as amended by the SCNs set
forth in Appendix 1 to Exhibit A hereto as may be further amended or
modified in accordance with this Agreement.
SPECIFICATION CHANGE NOTICE (SCN) -- an agreement in writing between the
Seller and the Buyer amending the Specification pursuant to Clause 2.
STANDARD SPECIFICATION -- the A320 standard specification document number
D.000.01000, Issue 5, dated January 30, 1998, published by the
Manufacturer, which includes an MTOW of 73.5 metric tons, a copy of which
is annexed as Exhibit A hereto.
SUPPLIER -- any supplier of Supplier Parts.
SUPPLIER PARTS -- 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.
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SUPPLIER PRODUCT SUPPORT AGREEMENT -- an agreement between the Seller 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 AND DOCUMENTATION -- as set forth in Exhibit F hereto.
TERMINATION EVENT -- as defined in Clause 21.1 of this Agreement.
TRAINING CONFERENCE -- as defined in Clause 16.4.1 of this Agreement.
WARRANTED PART -- as defined in Clause 12.1.1 of this Agreement.
WARRANTY CLAIM -- a defined in Clause 12.1.6(v) of this Agreement.
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.
Technical and trade items not otherwise defined herein will have the
meanings assigned to them as generally accepted in the aircraft
manufacturing industry.
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1 - SALE AND PURCHASE
The Seller will cause to be manufactured and will sell and deliver, and
the Buyer will buy and take delivery of, the Aircraft at the Delivery
Location, subject to the terms and conditions in this Agreement.
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2 - SPECIFICATION
2.1 SPECIFICATION DOCUMENTS
The Aircraft will be manufactured in accordance with the Specification.
The Specification may be further modified from time to time pursuant to
the provisions of this Clause 2.
2.1.2 SPECIFICATION CHANGE NOTICE
The Specification may be amended by written agreement between the parties
in an SCN. Each SCN will be substantially in the form set out in Exhibit B
hereto and will set out in detail the particular change to be made to the
Specification and the effect, if any, of such change on design,
performance, weight, time of delivery of the Aircraft, and text of the
Specification. An SCN may result in an adjustment of the Base Price.
2.1.3 DEVELOPMENT CHANGES
The Specification may also be amended by the Seller without the Buyer's
consent when changes to be incorporated in the Specification do not
adversely affect price, time of delivery, weight or performance of the
Aircraft, interchangeability or replaceability requirements under the
Specification. These changes are hereinafter defined as "Development
Changes."
2.1.4 INCONSISTENCY
In the event of any inconsistency between the Specification set forth in
Exhibit A hereto and any other part of this Agreement, the Specification
will be superseded to the extent of such inconsistency.
2.2 PROPULSION SYSTEMS
The Aircraft will be equipped with the Propulsion Systems.
2.3 CUSTOMIZATION MILESTONES CHART
The Seller will provide the Buyer with a Customization Milestones Chart.
The Customization Milestones Chart will state the lead times before
Delivery needed for agreeing on items requested by the Buyer from the
specification changes catalogs made available to the Seller.
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3 - PRICE
3.1 BASE PRICE OF THE AIRCRAFT
The Base Price of each Aircraft is the sum of:
(i) the Base Price of the Airframe, and
(ii) the Base Price of the Propulsion Systems.
3.1.1 BASE PRICE OF THE AIRFRAME
3.1.1.1 The Base Price of the Airframe will be the sum of the Base Prices set
forth below in (i) and (ii):
(i) the Base Price of the Standard Airframe, as defined in the
Standard Specification (excluding Buyer Furnished Equipment,
Propulsion Systems and SCNs), at delivery conditions
prevailing in January 1999, which is:
US $ [****]
(US dollars--[****], and
(ii) the Base Price of any and all SCNs mutually agreed upon prior
to the signature of this Agreement and set forth in Appendix
1 to Exhibit A hereto, at delivery conditions prevailing in
January 1999, which is:
US $ [****]
(US dollars--[****].
3.1.1.2 The Base Price of the Airframe of each Aircraft will be revised to the
Delivery Date of such Aircraft in accordance with the Airframe Price
Revision Formula.
3.1.2 BASE PRICE OF THE PROPULSION SYSTEMS
The Base Price of a set of two (2) IAE V2527-A5 Propulsion Systems, at
delivery conditions prevailing in January 1999, is:
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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US $ [****]
(US dollars--[****].
Said Base Price has been calculated from the Reference Price
indicated by International Aero Engines of US $ [****] (US
dollars--[****] in accordance with economic conditions
prevailing in September 1996.
Said Reference Price is subject to adjustment to the Delivery Date
in accordance with the International Aero Engines Price Revision
Formula set forth in Exhibit H hereto.
3.1.2.3 VALIDITY OF PROPULSION SYSTEMS PRICES
It is understood that the prices and Price Revision Formula cited above
for the Propulsion Systems and related equipment are based on
information received from International Aero Engines and remain subject
to any modification that might be communicated by International Aero
Engines to the Manufacturer, the Seller and/or the Buyer.
3.2 FINAL CONTRACT PRICE
The Final Contract Price of an Aircraft will be the sum of:
(i) the Base Price of the Airframe constituting a part of such
Aircraft, as adjusted to the Delivery Date of such Aircraft in
accordance with the Airframe Price Revision Formula;
(ii) the price (as of delivery conditions prevailing in January 1999)
of any SCNs entered into after the date of execution of this
Agreement, as adjusted to the Delivery Date of such Aircraft in
accordance with Subclause 4.1 of this Agreement;
(iii) the Reference Price of the installed Propulsion Systems
constituting a part of such Aircraft, as adjusted to the
Delivery Date in accordance with the Propulsion Systems Price
Revision Formula; and
(iv) any other amount resulting from any other provisions of this
Agreement and/or any other written agreement between the Buyer
and the Seller relating to the Aircraft.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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3.3 TAXES, DUTIES AND IMPOSTS
3.3.1 The Seller will bear and pay the amount of any and all taxes, duties,
imposts or similar charges of any nature whatsoever that are (i) imposed
upon the Buyer, (ii) imposed upon the Seller with an obligation on the
Buyer to withhold or collect the amount thereof from the Seller or (iii)
imposed upon the Buyer with an obligation on the Seller to withhold or
collect such amount from the Buyer, and that are levied, assessed,
charged or collected for or in connection with the fabrication,
manufacture, modification, assembly, sale, delivery, use of or payment
under this Agreement for any Aircraft, component, accessory, equipment
or part delivered or furnished hereunder, provided such taxes, duties,
imposts or similar charges have been promulgated and are enforceable
under the laws of the country of the Delivery Location.
3.3.2 The Buyer will bear and pay the amount of any and all taxes, duties,
imposts or similar charges of any nature whatsoever that are (i) imposed
upon the Seller, (ii) imposed upon the Buyer with an obligation on the
Seller to collect the amount thereof for the Buyer or (iii) imposed upon
the Seller with an obligation for the Buyer to withhold such amount from
the Seller, and that are levied, assessed, charged or collected for or
in connection with the fabrication, manufacture, modification, assembly,
sale, delivery or use of or payment under this Agreement for any
Aircraft, component, accessory, equipment or part delivered or furnished
hereunder, provided such taxes, duties, imposts or similar charges have
been levied, assessed, charged or collected under laws promulgated and
enforceable in countries other than the country of the Delivery
Location.
3.3.3 The Seller will arrange for the exportation of the Aircraft from the
country of the Delivery Location and will pay any customs duties, taxes
and fees required to be paid with respect to such exportation of the
Aircraft.
3.3.4 The Buyer will arrange for the importation of the Aircraft into any
country or jurisdiction and will pay any customs duties, taxes and fees
required to be paid with respect to such importation of the Aircraft.
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4 - PRICE REVISION
4.1 AIRFRAME PRICE REVISION FORMULA
The Base Price of the Airframe is subject to revision up to and
including the Delivery Date of such Aircraft, in accordance with the
Airframe Price Revision Formula.
4.2 PROPULSION SYSTEMS PRICE REVISION FORMULA
The Reference Price of the Propulsion Systems will be revised to the
Delivery Date corresponding to the Aircraft on which the Propulsion
Systems are installed, in accordance with the Propulsion Systems Price
Revision Formula.
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5 - PAYMENT TERMS
5.1 The Buyer will pay the Predelivery Payments, the balance or the Final
Contract Price and any other amount due hereunder in immediately
available funds in United States dollars to Credit Lyonnais, New York,
for transfer by Credit Lyonnais to the Seller's account with Credit
Lyonnais at 1, Esplanade Compans Caffarelli, 31000 Toulouse, France, or
to such other account as may be designated by the Seller.
5.2 Predelivery Payments
5.2.1 Predelivery Payments will be paid by the Buyer to the Seller for each
Aircraft and will, in the aggregate, amount to [****] of the
Predelivery Payment Reference Price of the Aircraft detained below
in Clause 5.2.2.
5.2.2 The Buyer will pay Predelivery Payments to the Seller calculated on the
Predelivery Payment Reference Price of each Aircraft. The Predelivery
Payment Reference Price is defined as:
A = Pb (1 + 0.04N)
where
A = the Predelivery Payment Reference Price for Aircraft to be
delivered in calendar year T.
Pb = the Base Price of the Aircraft as defined in Clause 3 above.
N = (T - 1999).
T = the year of delivery of the relevant Aircraft.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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5.2.3 Predelivery Payments will be paid according to the following schedule:
<Table>
<Caption>
PERCENTAGE OF AIRCRAFT
PREDELIVERY PAYMENT
PAYMENT DATE REFERENCE PRICE
------------ ---------------
<S> <C> <C>
No later than the first Working Day of the following
months:
[****]
--------------------------------------------------------------------------------
TOTAL PAYMENT PRIOR TO DELIVERY [****]
</Table>
5.2.4 If any Predelivery Payment is not received on the due date specified in
Clause 5.2.3, then, in addition to any other rights and remedies
available to the Seller, the Seller will have the right to set back the
Scheduled Delivery Month by a period of one (1) month for each aggregate
of thirty (30) days of delay in such payments.
Furthermore, if such delays in payment exceed sixty (60) days in the
aggregate, in addition to any other rights the Seller may have under
Clause 21, the Seller will have no obligation to deliver the Aircraft
within the Scheduled Delivery Month as modified pursuant to the
preceding paragraph. Upon receipt of the full amount of all late
Predelivery Payments, together with interest due under Clause 5.6,
provided that the Seller has not exercised its right of termination
under Clause 21, the Seller will inform the Buyer of a new Scheduled
Delivery Month consistent with Seller's other commitments and production
capabilities.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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5.2.5 SCN PREDELIVERY PAYMENTS
The Seller will be entitled to request SCN Predelivery Payments for each
SCN executed after signature of this Agreement.
(i) For each SCN executed before the first day of the eighteenth
(18th) month before the Scheduled Delivery Month, the Buyer will
make an SCN Predelivery Payment equal to fifteen percent (15%)
of the SCN price. This SCN Predelivery Payment will be paid on
the first day of the twelfth (12th) month before the Scheduled
Delivery Month.
(ii) For each 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 SCN 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 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.
(iii) Each of the above SCN Predelivery Payments paid by the Buyer
will be credited against the Final Contract Price of the
relevant Aircraft.
5.3 DEPOSIT
The Seller acknowledges that it has already received from the Buyer the
sum of US$ [****] (US dollars--[****]), which represents a deposit of
US$ [****] (US dollars--[****]) for each Firm Aircraft and of US $[****]
(US dollars--[****]) for each Option Aircraft. The deposit paid with
respect to each particular Aircraft will be credited without interest
against the first Predelivery Payment for such Aircraft.
5.4 PAYMENT OF BALANCE OF THE FINAL CONTRACT PRICE
Concurrently with the delivery of each Aircraft, the Buyer will pay to
the Seller the Balance of the Final Contract Price for such 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.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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5.5 PAYMENT OF OTHER AMOUNTS
5.5.1 Unless otherwise expressly provided for herein, any payments due
hereunder or in respect of an Aircraft in addition to those referred to
in Clauses 5.2 and 5.4 above will be paid by the Buyer concurrently with
the delivery of the corresponding Aircraft or, if the Seller elects to
invoice such amounts after delivery of such Aircraft, within one (1)
month after the invoice date.
5.5.2 Notwithstanding any other rights the Seller may have at contract or at
law, the Buyer and the Seller hereby agree that should any amount
(whether under this Agreement or under any other agreement between the
Buyer and the Seller and whether at the stated maturity of such amount,
by acceleration or otherwise) become due and payable by the 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 unused amount of any credit made available by the
Seller to the Buyer against such unpaid amount. The Seller will promptly
notify the Buyer 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 as agreed on between the Buyer and the Seller, the Seller will
have the right to claim from the Buyer and the Buyer will promptly pay
to the Seller on receipt of such claim interest at the rate of one and
one-half percent (1.5%) per month 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. Interest due
for any period less than one (I) month will be prorated The Seller's
right to receive such interest will be in addition to any other rights
of the Seller hereunder or at law.
5.7 REFUND OF PREDELIVERY PAYMENTS
The Buyer will have no right to any refund of any deposit. Predelivery
Payment or SCN Predelivery Payment received by the Seller, [****].
5.8 PROPRIETARY INTEREST
Notwithstanding any provision of law to the contrary, the Buyer will
not, by virtue of anything contained in this Agreement (including,
without limitation, 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 refers)
acquire any proprietary,
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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insurable or other interest whatsoever in any Aircraft before Delivery
of and payment for such Aircraft, as provided in this Agreement.
5.9 PAYMENT IN FULL
The Buyer's 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 the Buyer may have
against the Seller or any other person and all such payments will be
made without deduction or withholding of any kind. The 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
the Buyer is compelled by law to make any such deduction or withholding
the Buyer will pay such additional amounts 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: PLANT REPRESENTATIVES
6.1 INSPECTION PROCEDURES
6.1.1 All work to be carried out on the Aircraft and all materials and parts
thereof will at all reasonable times during business hours be open to
inspection by duly authorized representatives of the Buyer or its
designee at the respective works of the Associated Contractors and, if
possible, at the works of their respective subcontractors to carry out
the aforesaid inspection. Such 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 Buyer before any inspection.
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 Buyer and its said representatives will be
performed in such a manner as not to delay or binder the work to be
carried out on the Aircraft or the proper performance of this Agreement.
In no event will the Buyer or its representatives be permitted to
inspect any aircraft other than the Aircraft.
6.2 REPRESENTATIVES
For the purposes of Clause 6.1 above, starting with the date of this
Agreement until Delivery of the last Aircraft, the Seller will furnish
free-of-charge adequate 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 Buyer during the aforementioned period. The
Seller will provide telecommunications facilities at the Buyer's cost to
be invoiced on a monthly basis.
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7 - CERTIFICATION
Except as set forth in this Clause 7, the Seller will not be required to
obtain any other certificate or approval with respect to the Aircraft.
7.1 TYPE CERTIFICATION
The Aircraft has been type certificated under JAA procedures for joint
certification in the transport category. The Seller will obtain or cause
to be obtained the relevant type certificate (the "Type Certificate") to
allow the issuance of the Export Airworthiness Certificate.
7.2 EXPORT AIRWORTHINESS CERTIFICATE
Subject to the provisions of Clause 7.3, each Aircraft will be delivered
to the Buyer with the Certificate of Airworthiness for Export issued by
the DGAC, and in a condition enabling the Buyer (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 US Public Health Service Food and Drug Administration and in a
condition permitting the Buyer to operate such Aircraft under Part 121
of said Regulations, or any other successor certificate required under
US Federal Aviation Regulations. However, the Seller will have no
obligation, whether before, at or after Delivery of any Aircraft, to
make any alterations to such Aircraft to enable such Aircraft to meet
FAA requirements for specific operation on the Buyers routes, except as
may be provided for in this Agreement.
7.3 COST OF SCNs FOR EXPORT CERTIFICATION
7.3.1 If, any time before the date on which the Aircraft is Ready for
Delivery, any law or regulation is enacted, promulgated, becomes
effective and/or an interpretation of any law or regulation is issued
that requires any change to the Specification for the purposes of
obtaining the Export Airworthiness Certificate (a "Change in Law"), the
Seller will make the required modification and the parties hereto will
sign an SCN that specifies the effects, if any, on the guaranteed
performances, weights, interchangeability, Delivery Date, price of the
Aircraft and text of the Specification.
7.3.2 The Seller will as far as practicable (in its sole discretion and
without prejudice to Clause 7.3.3 (ii)) take into account the
information available to it concerning any proposed law, regulation or
interpretation that could become a Change in Law, in order to minimize
the costs of changes to the
20
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Specification as a result of such proposed law, regulation or
interpretation becoming effective before the applicable Aircraft is
Ready for Delivery.
7.3.3 The cost of implementing the modifications referred to in Clause 7.3.1
above will be
(i) for the account of the Seller if a Change in Law becomes
effective before the date of this Agreement, and
(ii) shared equally by the Seller and the Buyer if a Change in Law
becomes effective after the date of this Agreement,
provided, however, that any changes required specifically of the Buyer
in order to permit the Buyer to operate the Aircraft under Part 121 of
the US Federal Aviation Regulations are for the account of the Buyer.
7.3.4 Notwithstanding the provisions of Clauses 7.3.3 (i) and (ii), if a
Change in Law relates to the Propulsion Systems and, in particular, to
engine accessories, quick engine change units or thrust reversers, the
costs will be borne in accordance with such arrangements as may be made
separately between the Buyer and the Propulsion Systems manufacturer;
the Seller will have no obligation with respect thereto.
7.4 SPECIFICATION CHANGES AFTER DELIVERY
Clause 7.3 will not 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 [****] any law or regulation referred to in
Clause 7.3 is to be complied with. Any such changes or modifications
made to an Aircraft [****] the Buyer will be at the Buyer's expense.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
21
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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 proposed 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 Specification. Should it be established
that the Aircraft fails to complete the Technical Acceptance Process
satisfactorily, the Seller will without hindrance from the Buyer be
entitled to carry out any necessary changes 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 Buyer at least
ten (10) days in advance,
(ii) take place at the Delivery Location,
(iii) be carried our by the personnel of the Seller, and
(iv) include a technical acceptance flight, which will not exceed
three (3) hours.
8.2 BUYER'S ATTENDANCE
8.2.1 The Buyer will be entitled to attend the Technical Acceptance Process.
8.2.2 If the Buyer elects to attend the Technical Acceptance Process, the
Buyer
(i) will cooperate in complying with the reasonable requirements of
the Seller, with the intention of completing the Technical
Acceptance Process within five (5) Working Days, and
(ii) may have a maximum of four (4) of its representatives (no more
than three (3) of whom will have access to the cockpit at any
one time) accompany the Seller's representatives on a technical
acceptance flight, during which the Buyer's representatives will
comply with the instructions of the Seller's representatives.
8.2.3 If the Buyer does not attend and/or fails to cooperate in the Technical
Acceptance Process, the Seller will be entitled to complete the
Technical Acceptance Process without the Buyer's attendance, and the
Buyer will be
22
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deemed to have accepted the Technical Acceptance Process as satisfactory
in all respects.
8.3 CERTIFICATE OF ACCEPTANCE
Upon successful completion of the Technical Acceptance Process, the
Buyer 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") hereto.
8.4 FINALITY OF ACCEPTANCE
The Buyer's acceptance of delivery of each Aircraft will constitute
waiver by the Buyer of any right it may have under the Uniform
Commercial Code as adopted by the State of New York or otherwise to
revoke such acceptance for any reason, whether known or unknown to the
Buyer 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 if necessary to obtain the certificates
required under Clause 7. Such use will not prejudice the Buyer's
obligation to accept Delivery hereunder.
[****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
23
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9 - DELIVERY
9.1 DELIVERY SCHEDULE
9.1.1 Subject to 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"). Where no month is specified below
the Seller will
(i) in the case of a quarter, notify the Buyer of the Scheduled
Delivery Month by twenty-four (24) months before the beginning
of the quarter,
(ii) in the case of a half of a year, notify the Buyer of the
Scheduled Delivery Month by twenty-four (24) months before the
beginning of the half of the year,
(iii) in the case of a year, notify the Buyer of the quarter by
twenty-four (24) months before the beginning of the year and
then notify the Buyer of the Scheduled Delivery Month by
twenty-four (24) months before the beginning of the quarter.
Firm Aircraft
-------------
Firm Aircraft No 1 [****] 2000
Firm Aircraft No 2 [****] 2000
Firm Aircraft No 3 [****] 2000
Firm Aircraft No 4 [****] 2000
Firm Aircraft No 5 [****] 2000
Firm Aircraft No 6 [****] 2000
Firm Aircraft No 7 [****] 2001
Firm Aircraft No 8 [****] 2001
Firm Aircraft No 9 [****] 2001
Firm Aircraft No 10 [****] 2001
Firm Aircraft No 11 [****] 2001
Firm Aircraft No 12 [****] 2001
Firm Aircraft No 13 [****] 2002
Firm Aircraft No 14 [****] 2002
Firm Aircraft No 15 [****] 2002
Firm Aircraft No 16 [****] 2002
Firm Aircraft No 17 [****] 2002
Firm Aircraft No 18 [****] 2002
Firm Aircraft No 19 [****] 2002
Firm Aircraft No 20 [****] 2002
Firm Aircraft No 21 [****] 2003
Firm Aircraft No 22 [****] 2003
Firm Aircraft No 23 [****] 2003
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
24
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Firm Aircraft No 24 [****] 2003
Firm Aircraft No 25 [****] 2003
Option Aircraft
---------------
Option Aircraft No 26 [****] 2003
Option Aircraft No 27 [****] 2003
Option Aircraft No 28 [****] 2003
Option Aircraft No 29 [****] 2004
Option Aircraft No 30 [****] 2004
Option Aircraft No 31 [****] 2004
Option Aircraft No 32 [****] 2004
Option Aircraft No 33 [****] 2004
Option Aircraft No 34 [****] 2005
Option Aircraft No 35 [****] 2005
Option Aircraft No 36 [****] 2005
Option Aircraft No 37 [****] 2005
Option Aircraft No 38 [****] 2005
Option Aircraft No 39 [****] 2006
Option Aircraft No 40 [****] 2006
Option Aircraft No 41 [****] 2006
Option Aircraft No 42 [****] 2006
Option Aircraft No 43 [****] 2006
Option Aircraft No 44 [****] 2006
Option Aircraft No 45 [****] 2007
Option Aircraft No 46 [****] 2007
Option Aircraft No 47 [****] 2007
Option Aircraft No 48 [****] 2007
Option Aircraft No 49 [****] 2007
Option Aircraft No 50 [****] 2007
9.1.2 [****]
[****] the Seller will give the Buyer at least thirty (30) days'
written notice of the anticipated date on which the Aircraft will be
Ready for Delivery [****]. [****] the Seller will notify the Buyer of
any change in such date necessitated by the conditions of manufacture
or flight.
9.2 DELIVERY
9.2.1 The Buyer will send its representatives to the Delivery Location to take
Delivery within seven (7) days after the date on which the Aircraft is
Ready for Delivery.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
25
<Page>
9.2.2 The Seller will transfer title to the Aircraft to the Buyer free and
clear of all encumbrances, provided that the Balance of the Final
Contract Price has been paid by the Buyer pursuant to Clause 5.4 and
that the Certificate of Acceptance has been signed and delivered to the
Seller pursuant to Clause 8.3. The Seller will provide the Buyer with a
bill of sale in the form of Exhibit E hereto and/or such other
documentation confirming transfer of title and receipt of the Final
Contract Price as may reasonably be requested by the Buyer. Title to,
property interest in and risk of loss or damage to the Aircraft will be
transferred to the Buyer on Delivery.
9.2.3 Should the Buyer fail to
(i) deliver the signed Certificate of Acceptance to the Seller on or
before the Delivery Date, or
(ii) pay the Balance of the Final Contract Price for the Aircraft to
the Seller on the Delivery Date.
then the Buyer will be deemed to have rejected Delivery without warrant
when the Aircraft was duly tendered to the Buyer hereunder. In the event
the Buyer rejects the Aircraft, the Seller will retain title to the
Aircraft and the Buyer will be deemed to assume and will bear all risk
of loss or damage to the Aircraft and will 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 Buyer's rejection, it being understood that the Seller will be under
no duty to store, park, insure, 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 Buyer and the Seller will cooperate to obtain any licenses that may
be required by the Aviation Authority of the Delivery Location 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 Buyer. The Buyer
will make direct arrangements with the supplying companies for the fuel
and oil required for all post-Delivery flights.
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10 - EXCUSABLE DELAY AND TOTAL LOSS
10.1 SCOPE OF EXCUSABLE DELAY
Neither the Seller nor the Manufacturer 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 Community or the Commission of the European Community 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; delay in obtaining any airworthiness or type
certification; inability after due and timely diligence to procure
materials, accessories, equipment or parts; general hindrance in
transportation; or failure of a subcontractor or Supplier to furnish
materials, components, accessories, equipment or parts; (ii) any delay
caused directly or indirectly by the action or inaction of the Buyer;
and (iii) delay in delivery or otherwise in the performance of this
Agreement by the Seller due in whole or in part to any delay in or
failure of the delivery of, or any other event or circumstance relating
to, the Propulsion Systems or Buyer Furnished Equipment.
10.2 CONSEQUENCES OF EXCUSABLE DELAY
10.2.1 If an Excusable Delay occurs the Seller will
(i) notify the Buyer 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 the Buyer;
27
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(iv) use reasonable efforts to remove the cause(s) within its
control and minimize any delay; and
(v) as soon as practicable after the removal of the cause of
the delay resume performance of its obligations under
this Agreement and in particular will notify the Buyer
of the revised Scheduled Delivery Month.
10.2.2 If an Excusable Delay is due to the action or inaction of the Buyer,
then the Buyer will use reasonable efforts to remove the cause(s) within
its control and minimize any delay.
10.3 TERMINATION ON EXCUSABLE DELAY
10.3.1 If the Delivery of any Aircraft is delayed as a result of an Excusable
Delay for a period of more than twelve (12) months 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 to the other party within thirty (30) days after the expiration
of such twelve (12) month period. However, the Buyer will not be
entitled to terminate this Agreement pursuant to this Clause if the
Excusable Delay is caused directly or indirectly by the action or
inaction of the Buyer. [****]
10.3.2 In the event that the Seller notifies the Buyer of a revised Scheduled
Delivery Month pursuant to Clause 10.2(v), in respect of a delay in
Delivery of an Aircraft of more than twelve (12) months after the last
day of the Scheduled Delivery Month, then either party may terminate
this Agreement with respect to the affected Aircraft. Termination will
be made by giving written notice to the other party within thirty (30)
days after the Buyer's receipt of the notice of a revised Scheduled
Delivery Month. [****]
10.3.3 If this Agreement is not terminated under the terms of Clause 10.3.1 or
10.3.2 above, then the Seller will be entitled to reschedule Delivery.
The Seller will notify the Buyer of the new Scheduled Delivery Month
after the thirty (30) day period referred to in Clause 10.3.1 or 10.3.2,
and this new Scheduled Delivery Month will be binding on the parties.
10.3.4 [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
28
<Page>
[****]
10.4 TOTAL LOSS; LOST, DESTROYED OR DAMAGED AIRCRAFT
If, before delivery thereof, in the reasonable opinion of the Seller, an
Aircraft is lost, destroyed or damaged beyond economic repair ("Total
Loss"), then the Seller will notify the Buyer to this effect as soon as
reasonably possible. The Seller will include in its notice, or as soon
after the notice as possible, the earliest date that an aircraft to
replace the Aircraft may be delivered to the Buyer. The notice will also
state a revised Scheduled Delivery Month for the replacement aircraft.
However, in the event the specified revised Scheduled Delivery Month is
more than twelve (12) months after the last day of the originated
Scheduled Delivery Month, then this Agreement will terminate unless
(i) the Buyer notifies the Seller within one (1) month of the date
of receipt of the Sellerls 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.
Notwithstanding the above, nothing herein will require the Seller to
manufacture and deliver a replacement aircraft if manufacture would
require the reactivation of the Manufacturer's production line for the
model or series of aircraft that includes the Aircraft.
10.5 TERMINATION RIGHTS EXCLUSIVE
In the event that this Agreement is terminated as provided for under the
terms of Clauses 10.3 or 10.4, such termination will discharge all
obligations and liabilities of the parties hereunder with respect to
such affected Aircraft and undelivered material, services, data or
other items applicable thereto and to be furnished hereunder and neither
party will have any claim against the other for any loss resulting from
such nondelivery. The Seller will in no circumstances have any liability
whatsoever for Excusable Delay other than as set forth in this Clause
10.
10.6 REMEDIES
THIS CLAUSE 10 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE BUYER FOR
DELAYS IN DELIVERY OR FAILURE TO DELIVER, OTHER THAN SUCH DELAYS AS ARE
COVERED BY CLAUSE 11, AND THE BUYER HEREBY WAIVES
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
29
<Page>
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. THE BUYER WILL NOT BE
ENTITLED TO CLAIM THE REMEDIES AND RECEIVE THE BENEFITS PROVIDED IN THIS
CLAUSE 10 TO THE EXTENT THE DELAY REFERRED TO IN THIS CLAUSE 10 IS
CAUSED BY THE NEGLIGENCE OR FAULT OF THE BUYER OR ITS REPRESENTATIVES.
30
<Page>
11 - INEXCUSABLE DELAY
11.1 LIQUIDATED DAMAGES
Should an Aircraft not be Ready for Delivery to the Buyer within thirty
(30) days after the last day of the Scheduled Delivery Month (as such
month may be changed pursuant to Clauses 2, 7 or 10) (the "Delivery
Period") and such delay is not as a result of an Excusable Delay or
Total Loss, then such loss will be termed an "Inexcusable Delay." In the
event of an Inexcusable Delay, the Buyer will have the right to claim,
and the Seller will pay the Buyer liquidated damages of US $[****] (US
dollars--[****]) for each day of delay in the Delivery, starting
thirty-one (31) days after the last day of the Scheduled Delivery
Month.
The amount of liquidated damages will in no event exceed the total of US
[****] (US dollars--[****]) in respect of any one Aircraft.
The Buyer's right to liquidated damages in respect of an Aircraft is
conditional on the Buyer's submitting a written claim for liquidated
damages to the Seller by, as applicable, thirty (30) days after Delivery
or thirty (30) days after a termination under Clause 11.3 below.
11.2 RENEGOTIATION
If as a result of an Inexcusable Delay, Delivery does not occur within
six (6) months after the Delivery Period, the Buyer will have the right
exercisable by written notice to the Seller given between fifteen (15)
days and one (1) month after the six (6) months to require from the
Seller a renegotiation of the Scheduled Delivery Month for the affected
Aircraft. Unless otherwise agreed between the Seller and the Buyer
during such renegotiation, the said renegotiation will not prejudice the
Buyer's right to receive liquidated damages in accordance with Clause
11.1 during the period of Inexcusable Delay.
11.3 TERMINATION
If as a result of an Inexcusable Delay, Delivery does not occur within
twelve (12) months after the Delivery Period and the parties have not
renegotiated the Delivery Date pursuant to Clause 11.2, then both
parties will have the right exercisable by written notice to the other
party, given between one (1) and two (2) months after the twelve (12)
months 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 the Buyer any amounts due
pursuant to Clause 11.1 and will repay the Buyer the Predelivery
Payments and SCN
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
31
<Page>
[****]
11.4 [****]
11.5 SETOFF PAYMENTS
Notwithstanding anything to the contrary contained herein, the Seller
will have the right to apply any and all sums previously paid by the
Buyer to the Seller with respect to a terminated Aircraft first to the
payment of any other amounts owing from the Buyer to the Seller or any
Affiliate thereof under any agreement between them.
11.6 REMEDIES
THIS CLAUSE 11 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE BUYER FOR
DELAYS IN DELIVERY OR FAILURE TO DELIVER. OTHER THAN SUCH DELAYS AS ARE
COVERED BY CLAUSE 10, 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. THE BUYER WILL NOT BE ENTITLED TO CLAIM THE
REMEDIES AND RECEIVE THE BENEFITS PROVIDED IN THIS CLAUSE 11 WHERE THE
DELAY REFERRED TO IN THIS CLAUSE 11 IS CAUSED BY THE NEGLIGENCE OR FAULT
OF THE BUYER OR ITS REPRESENTATIVES.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
32
<Page>
12- WARRANTIES AND SERVICE LIFE POLICY
The Seller has negotiated and obtained the following Standard Warranty,
Service Life Policy, Supplier Warranties and Interface Commitment from
the Manufacturer with respect to the Aircraft, 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) all as hereinafter set out. The Seller
hereby assigns to the Buyer, and the Buyer hereby accepts, all of the
rights and obligations of the Seller under the said Standard Warranty,
Service Life Policy, Supplier Warranties and Interface Commitment, and
the Seller subrogates to the Buyer all such rights and obligations in
respect of the Aircraft. The Seller hereby warrants to the Buyer that it
has all requisite authority to make the foregoing assignment and effect
the foregoing subrogation to and in favor of the Buyer and that it will
not enter into any amendment of the provisions so assigned without the
prior written consent of the Buyer.
It is understood that, in the provisions below between the words QUOTE
and UNQUOTE, capitalized terms have the meanings assigned thereto in
this Agreement, except that the term Seller refers to the Manufacturer
and the term Buyer means the Seller.
QUOTE
12.1 STANDARD WARRANTY
12.1.1 NATURE OF WARRANTY
Subject to the limitations and conditions as hereinafter provided, and
except as provided in Clause 12.1.2. the Seller warrants to the Buyer
that each Aircraft and each Warranted Part will at the time of delivery
to the Buyer:
(i) be free from defects in material,
(ii) be free from defects in workmanship, including, without
limitation, processes of manufacture,
(iii) be free from defects in design (including, without limitation,
selection of materials) having regard to the state of the art at
the date of such design, and
(iv) be free from defects arising from failure to conform to the
Specification, except as to those portions of the Specification
that are expressly stated in the Specification to be estimates
or approximations or design aims.
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For the purposes of this Agreement, the term "Warranted Part" will mean
any Seller proprietary component, equipment, accessory or part that at
the time of delivery of an Aircraft (a) is installed on such Aircraft,
(b) is manufactured to the detail design of the Seller or a
subcontractor of it and (c) bears a part number of the Seller.
12.1.2 EXCEPTIONS
The warranties set forth in Clause 12.1.1 will not apply to Buyer
Furnished Equipment, nor to the Propulsion Systems, nor to any
component, accessory, equipment or part purchased by the Buyer 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 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,
in view of the state of the art at the date of such design, that
impairs the use 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 thirty-six (36)
months after delivery of the affected Aircraft.
12.1.4 BUYER'S REMEDY AND SELLER'S OBLIGATION
12.1.4.1 The Buyer's remedy and the Seller's obligation and liability under
Clauses 12.1.1 and 12.1.2 hereinabove are limited to, at the Seller's
expense and option, the repair, replacement or correction of, or the
supply of modification kits, [****] to eliminate the defect to, any
defective Warranted Part. Alternatively, the Seller may, at its option,
furnish a credit to the Buyer for the future purchase of Material equal
to the price at which the Buyer is then entitled to acquire a
replacement for the defective Warranted Part. Nothing herein contained
will obligate the Seller to correct any failure to conform to the
Specification with
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
34
<Page>
respect to components, equipment, accessories or parts that the parties
agree in writing at the time of delivery of the affected Aircraft are
acceptable deviations or have no material adverse effect on the use,
operation or performance of an Aircraft.
12.1.4.2 In the event a defect covered by Clause 12.1.1(iii) becomes apparent
within the applicable period set forth in Clause 12.1.3 and the Seller
is obligated to correct such defect, the Seller will also, if so
requested by the Buyer in writing, make such correction in any Aircraft
that has not already been delivered to the Buyer. However, the Seller
will not be responsible nor deemed to be in default on account of any
delay in delivery of any Aircraft or otherwise, in respect of
performance of this Agreement, due to the Seller's undertaking to make
such correction and, rather than accept a delay in delivery of any such
Aircraft, the Buyer and the Seller may agree to deliver such Aircraft
with subsequent correction of the defect by the Buyer at the Seller's
expense, or the Buyer may elect to accept delivery and thereafter file
a Warranty Claim as though the defect had become apparent immediately
after delivery of such Aircraft.
12.1.5 WARRANTY CLAIM REQUIREMENTS
The Buyer's 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's having become apparent within the applicable
warranty period, as set forth in Clause 12.1.3,
(iii) the Buyer's having submitted to the Seller proof reasonably
satisfactory to the Seller that the claimed defect is due to a
matter embraced within this Clause 12.1, and that such defect
did not result from any act or omission of the Buyer,
including, but not limited to, any failure to operate and
maintain the affected Aircraft or part thereof in accordance
with the standards or any matter set forth or covered in
Clause 12.1.10,
(iv) the Buyer's having returned as soon as reasonably practicable
the Warranted Part claimed to be defective to such repair
facilities as may be designated by the Seller, except where
the Buyer elects to repair a defective Warranted Part in
accordance with the provisions of Clause 12.1.7, and
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(v) the Seller's having received a Warranty Claim fulfilling the
conditions of and in accordance with the provisions of Clause
12.1.6 below.
12.1.6 WARRANTY ADMINISTRATION
The warranties set forth in Clause 12.1 will be administered as
hereinafter provided:
(i) CLAIM DETERMINATION
Warranty Claim determination by the Seller will be reasonably
based on the claim details, reports from the Seller's regional
representative, historical data logs, inspections, tests,
findings during repair, defect analysis and other suitable
documents and information.
(ii) TRANSPORTATION COSTS
Transportation costs associated with the sending of a
defective Warranted Part to the facilities designated by the
Seller and for the return therefrom of a repaired or
replacement Warranted Part will be borne by the Seller,
provided, however, that the Buyer will use its best efforts to
minimize such costs, particularly by using its own airfreight
system for transportation at no charge to the Seller.
(iii) RETURN OF AN AIRCRAFT
In the event that the Buyer desires to return an Aircraft to
the Seller for consideration of a Warranty Claim, the Buyer
will notify the Seller of its intention to do so and the
Seller will, before such return, have the right to inspect
such Aircraft and thereafter, without prejudice to its rights
hereunder, to repair such Aircraft, at its sole option, either
at the Buyer's facilities or at another place acceptable to
the Seller. Return of any Aircraft by the Buyer to the Seller
and return of such Aircraft to the Buyer's facilities will be
at the Buyer's expense.
(iv) ON-AIRCRAFT WORK BY THE SELLER
A defect subject to this Clause 12.1 may justify the dispatch
by the Seller of a working team to repair or correct such
defect through the embodiment of one or more Seller's Service
Bulletins at the
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Buyer's facilities, or the Seller may accept the return of an
Aircraft to perform or have performed such repair or
correction.
If, in the Seller's opinion, the work necessitates the
technical expertise of the Seller, then, if the Buyer
requests the Seller to perform the work, the Seller and the
Buyer will agree on a schedule and place for the work to be
performed.
If, in the Seller's opinion, the work does not necessitate the
technical expertise of the Seller, but the Buyer nevertheless
requests the Seller to perform the work, the Seller and the
Buyer will agree on a schedule and place for the work to be
performed, and all related expenses, including but not limited
to travel and living expenses, in excess of labor costs
defined in Clause 12.l.7(v)(a), incurred in performing such
repair or correction, will be borne by the Buyer.
(v) WARRANTY CLAIM SUBSTANTIATION
For each claim under this Clause 12.1, within sixty (60) days
after a defect becomes apparent, the Buyer will give written
notice to the Seller that contains at least the following data
with respect to a part or Aircraft, as applicable ("Warranty
Claim"):
(a) description of defect and action taken, if any,
(b) date of incident and/or of removal,
(c) description of the defective part,
(d) part number,
(e) serial number (if applicable),
(f) position on Aircraft, according to Catalog Sequence
Number (CSN) of the Illustrated Parts Catalog,
Component Maintenance Manual or Structural Repair
Manual (as such documents are defined in Clause 14
and Exhibit F hereto) as applicable,
(g) total flying hours or calendar times, as applicable,
at the date of appearance of a defect,
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(h) time since last shop visit at the date of defect
appearance.
(i) Manufacturer's serial number of the Aircraft and/or
its registration number,
(j) Aircraft total flying hours and/or number of landings
at the date of defect appearance,
(k) claim number,
(l) date of claim, and
(m) date of delivery of an Aircraft or part to the Buyer.
Claims are to be addressed as follows:
AIRBUS INDUSTRIE
CUSTOMER SERVICE DIVISION SG-C
WARRANTY ADMINISTRATION
1, ROND-POINT MAURICE BELLONTE
B.P. 33
F-31707 BLAGNAC
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
List. 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 the Buyer to the
Seller will at all times remain with the Buyer, except that
(i) when the Seller has possession of a returned Aircraft,
component, accessory, equipment or part to which the Buyer 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 the Buyer
of any item furnished by the Seller to the Buyer as a
replacement therefor. Upon the Seller's shipment to the Buyer
of any replacement component, accessory, equipment or part
provided by the Seller pursuant to this Clause
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12.1, title to and risk of loss of such component, accessory,
equipment or part will pass to the Buyer.
(vii) REJECTION
The Seller will provide reasonable written substantiation in
case of rejection of a claim. In such event the Buyer will pay
to the Seller reasonable inspection and test charges incurred
by the Seller in connection with the investigation and
processing of such claim. Transportation to the ASCO Spares
Center in Ashburn, VA, insurance, and any other costs
associated with the sending of any Warranted Part or any other
item, equipment, component or part for which the Buyer's
warranty claim is rejected by the Seller will be borne by the
Buyer.
(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.
12.1.7 IN-HOUSE WARRANTY
(i) AUTHORIZATION
The Buyer is hereby authorized to perform the repair of
Warranted Parts, subject to the terms of this Clause 12.1.7
("In-house Warranty"). The Buyer will notify the Seller's
representative of its decision to perform any in-house repairs
before such repairs are commenced, unless it is not practical
to do so, in which case the Buyer will notify the Seller of
the in-house repair as soon as reasonably practicable.
(ii) CONDITIONS OF AUTHORIZATION
The Buyer will be entitled to the benefits under this Clause
12.1.7 for repair of Warranted Parts:
(a) only if adequate facilities and qualified personnel
are available to the Buyer,
(b) in accordance with the Seller's written instructions
set forth in documents such as the Aircraft
Maintenance Manual, Component Maintenance Manual
(Manufacturer), Component Maintenance Manual (Vendor)
and Structural Repair Manual, and
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(c) only to the extent specified by the Seller, or, in the
absence of such specification, to the extent reasonably
necessary to correct the defect, in accordance with the
standards set forth in Clause 12.1.10.
(iii) SELLER'S RIGHTS
The Seller will have the right to have any Warranted Part, or
any part removed therefrom, which is claimed to be defective,
returned to the Seller, as set forth in Clause 12.16(ii), if,
in the judgment of the Seller, the nature of the defect
requires technical investigation.
The Seller will further have the right to have a
representative present during the disassembly, inspection and
testing of any Warranted Part claimed to be defective.
(iv) IN-HOUSE WARRANTY CLAIM SUBSTANTIATION
Claims for In-house Warranty credit will be filed within the
time period set forth in and will contain the same information
required in Warranty Claims under Clause 12.1.6(v) and in
addition 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,
- total price of parts,
- related Seller's or third party's invoices (if
applicable),
(c) detailed number of labor hours,
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(d) agreed In-house Warranty Labor Rate (defined below in
Clause 12.1.7(v)(a)), and
(e) total claim value.
(v) CREDIT
The Buyers sole remedy, and the Seller's sole obligation and
liability, in respect of In-house Warranty claims, will be a
credit to the Buyer's account. The credit to the Buyer's
account will be equal to the direct labor cost expended in
performing a repair and to 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 manhours spent
on disassembly, inspection, repair, reassembly. and
final inspection and test (including flight tests if
flight tests prove necessary to complete a repair
under the In-house Warranty) of the Warranted Part
alone will be counted. Manhours required for
maintenance work concurrently being carried out on
the Aircraft or Warranted Part will not be included.
The manhours counted as set forth above will be
multiplied by an agreed labor rate representing the
Buyer's composite average hourly labor rate
(excluding all fringe benefits, premium time
allowances, social security charges, business taxes
and similar items) paid to the Buyer's employees
whose jobs are directly related to the performance of
the repair (the "In-house Warranty Labor Rate"). It
is agreed that for the purpose hereof the In-house
Warranty Labor Rate is US$ 45 (US
dollars--forty-five) at economic conditions
prevailing in January 1999.
Such In-house Warranty Labor Rate is subject to
adjustment annually by multiplying by the ratio
HEn/HEb. For the purposes of this Subclause 12.1.7(v)
only, HEn is equal to the Labor Index defined in
Exhibit G hereto for January of the year in which
manhours are spent and HEb is equal to such Labor
Index for January 1999.
(b) Direct material costs are determined by the prices at
which the Buyer acquired such material, excluding any
parts and materials used for overhaul furnished free
of charge by the Seller.
(vi) LIMITATION ON CREDIT
The Buyer will in no event be credited for repair costs
(including labor and material) for any Warranted Part
exceeding sixty-five percent (65%) of the Seller's current
catalog price for a replacement of such defective Warranted
Part
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or exceeding those costs which would have resulted if repairs
had been carried out at the Seller's facilities.
Such cost will be substantiated in writing by the Seller on
reasonable request by the Buyer.
(vii) SCRAPPED MATERIAL
The Buyer may, with the agreement of the Seller's Resident
Customer Support Representative, scrap any such defective
parts that are beyond economic repair and not required for
technical evaluation.
If the Buyer does not obtain the agreement of the Seller's
Resident Customer Support Representative to scrap a Warranted
Part defective beyond economic repair, then the 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 twenty (120) days after the date of completion of
repair or ninety (90) days after submission of a claim for
In-house Warranty credit relating thereto, whichever is
longer. Such parts will be returned to the Seller within
thirty (30) days of receipt of the Seller's request to that
effect.
Scrapped Warranted Parts will be evidenced by a record of
scrapped material certified by an authorized representative of
the Buyer, which will be kept in the Buyer's file for at least
the duration of the warranty periods set forth in this Clause
12.1.
(viii) LIMITATIONS ON LIABILITY OF SELLER
THE SELLER WILL NOT BE LIABLE FOR ANY RIGHT, CLAIM OR REMEDY,
AND THE BUYER WILL INDEMNIFY THE SELLER AGAINST THE CLAIMS OF
ANY THIRD PARTIES FOR ANY DEFECT, NONCONFORMANCE OR PROBLEM OF
ANY KIND, ARISING OUT OF OR IN CONNECTION WITH ANY REPAIR OF
WARRANTED PARTS UNDERTAKEN BY THE BUYER UNDER THIS SUBCLAUSE
12.1.7 OR ANY OTHER ACTIONS UNDERTAKEN BY THIS BUYER UNDER
THIS SUBCLAUSE 12.1.7, INCLUDING BUT NOT LIMITED TO (I)
LIABILITY IN CONTRACT OR TORT, (II) LIABILITY ARISING FROM THE
BUYER'S ACTUAL OR IMPUTED NEGLIGENCE, INTENTIONAL TORTS AND/OR
STRICT LIABILITY, AND/OR (III) LIABILITY TO ANY THIRD PARTIES.
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12.1.8 STANDARD WARRANTY TRANSFERABILITY
The warranties provided for in this Clause 12.1 for any Warranted Part
will accrue to the benefit of any airline in revenue service other than
the Buyer, if the Warranted Part enters into the possession of any such
airline as a result of a pooling agreement between such airline and the
Buyer, in accordance with the terms and subject to the limitations and
exclusions of the foregoing warranties and to applicable laws or
regulations.
12.1.9 WARRANTY FOR CORRECTED, REPLACEMENT OR REPAIRED WARRANTED PARTS
Whenever any Warranted Part that contains a defect for which the Seller
is liable under 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, whichever may be the case, will be the remaining
portion of the original warranty in respect of such corrected, repaired
or replacement Warranted Part. In the event that a defect is
attributable to a defective repair or replacement by the Buyer, a
Warranty Claim with respect to such defect will not be allowable,
notwithstanding any subsequent correction or repairs, and will
immediately terminate the remaining warranties under this Clause 12.1
in respect of the affected Warranted Part.
12.1.10 GOOD AIRLINE OPERATION - NORMAL WEAR AND TEAR
The Buyer's 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 good
commercial airline practice, all technical documentation and any other
instructions issued by the Seller, the Suppliers or the manufacturer of
the Propulsion Systems and all applicable rules, regulations and
directives of the relevant Aviation Authorities.
The Seller's liability under this Clause 12.1 will not extend to normal
wear and tear nor to
(i) any Aircraft or component, equipment, accessory or part
thereof that has been repaired, altered or modified after
delivery by any party in a manner other than that approved by
the Seller;
(ii) any Aircraft or component, equipment, accessory or part
thereof that has been knowingly operated in a damaged state;
or
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(iii) any component, equipment, accessory or part from which the
trademark, trade name, part or serial number or other
identification marks have been intentionally removed.
This waiver of the Seller's liability by the Buyer will not apply in
the cases of Clause 12.1.10(i) and Clause 12.1.10(ii) above if the
Buyer submits evidence satisfactory to the Seller that the defect did
not arise from nor was contributed to by either of said cases.
12.2 SELLER SERVICE LIFE POLICY
In addition to the warranties set forth in Clause 12.1 above, the
Seller further agrees that should a Failure occur in any Item, then,
subject to the general conditions and limitations set forth in Clause
12.2.4 below, the provisions of this Clause 12.2 will apply.
12.2.1 DEFINITIONS
For the purposes of this Clause 12.2, the following definitions will
apply:
12.2.1.1 "Item" means any of the Seller components, equipment, accessories or
parts listed in Exhibit C hereto which 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.
12.2.1.2 "Failure" means any breakage of, or defect in, an Item that materially
impairs the utility or safety of the Item, provided that any such
breakage of, or defect in, any Item did not result from any breakage or
defect in any other Aircraft part or component or from any other
extrinsic force.
12.2.2 PERIODS AND SELLER'S UNDERTAKING
Subject to the general conditions and limitations set forth in Clause
12.2.4 below, the Seller agrees that if a Failure occurs in an Item
within twelve (12) years after the delivery of the applicable said
Aircraft to the Buyer, whichever will first occur, the Seller will, at
its own discretion, as promptly as practicable and for a price that
reflects the Seller's financial participation as hereinafter provided,
either:
12.2.2.1 design and furnish to the Buyer a correction for such Item subject to a
Failure and provide any parts required for such correction (including
Seller designed standard parts but excluding industry standard parts),
or,
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12.2.2.2 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 Buyer
under this Service Life Policy in connection with the correction or
replacement of an Item will be furnished to the Buyer at the Seller's
current sales price therefor, less the Seller's financial
participation, which will be determined in accordance with the
following formula:
C (N - T)
---------
P = N
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 particular Aircraft
in which the Item subject to a Failure was originally
installed,
and,
N: one hundred and forty-four (144) months.
12.2.4 GENERAL CONDITIONS AND LIMITATIONS
12.2.4.1 Notwithstanding Clause 12.2.3, the undertakings given in this Clause
12.2 will not be valid during the period applicable to an Item under
Clause 12.1.
12.2.4.2 The Buyer's remedy and the Seller's obligation and liability under this
Service Life Policy are subject to compliance by the Buyer with the
following conditions precedent:
(i) The Buyer will maintain log books and other historical records
with respect to each Item adequate to enable determination as
to whether the alleged Failure is covered by this Service Life
Policy and, if so, to define the portion of the cost to be
borne by the Seller in accordance with Clause 12.2.3 above.
(ii) The Buyer will keep the Seller informed of any significant
incidents relating to an Aircraft, howsoever occurring or
recorded.
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(iii) The conditions of Clause 12.1.10 will have been complied with.
(iv) The Buyer will carry out specific structural inspection
programs for monitoring purposes as may be established from
time to time by the Seller. Such programs will be, to the
extent possible, compatible with the Buyer's operational
requirements and will be carried out at the Buyer's expense.
Reports relating thereto will be regularly furnished to the
Seller.
(v) In the case of any breakage or defect, the Buyer will report
the same in writing to the Seller within ninety (90) days
after any breakage or defect in an Item becomes apparent,
whether or not said breakage or defect can reasonably be
expected to occur in any other Aircraft, and the Buyer will
inform the Seller in sufficient detail about the breakage or
defect to enable the Seller to determine whether said breakage
or defect 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 In the event that the Seller has issued a modification applicable to an
Aircraft, the purpose of which is to avoid a Failure, the Seller may
elect to supply 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 Buyer, then, in respect of such Failure and any Failures
that could ensue therefrom, the validity of the Seller's commitment
under this Clause 12.2 will be subject to the Buyer's 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 SUBCLAUSE
12.2 IS TO MAKE ONLY THOSE CORRECTIONS TO THE ITEMS OR FURNISH
REPLACEMENTS THEREFOR AS PROVIDED IN THIS SUBCLAUSE 12.2. THE BUYER'S
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 BUYER
REASONABLY EXPENDS 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
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NONPERFORMANCE IS RELATED, LESS THE AMOUNT THAT THE BUYER OTHERWISE
WOULD HAVE BEEN REQUIRED TO PAY UNDER THIS SUBCLAUSE 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
SUBCLAUSE 12.5, THE BUYER 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.
12.2.5 TRANSFERABILITY
The Buyer's rights under this Clause 12.2 will not be assigned, sold,
leased, transferred or otherwise alienated by operation of law or
otherwise, without the Seller's prior written consent, not to be
unreasonably withheld.
Any unauthorized assignment, sale, lease, transfer or other alienation
of the Buyer's rights under this Service Life Policy will, as to the
particular Aircraft involved, immediately void this Service Life Policy
in its entirety.
12.3 SUPPLIER WARRANTIES
12.3.1 SELLER'S SUPPORT
Prior to delivery of the first Aircraft, the Seller will provide the
Buyer with the warranties and service life policies that the Seller has
obtained pursuant to the Supplier Product Support Agreements.
12.3.2 SUPPLIER'S DEFAULT
12.3.2.1 In the event that any Supplier under any standard warranty obtained by
the Seller pursuant to Clause 12.3.1 hereof defaults in the performance
of any material obligation under such warranty with respect to a
Supplier Part, and the Buyer submits within a reasonable time to the
Seller reasonable proof that such default has occurred, then Clause
12.1 this Agreement will apply to the extent it would have applied had
such Supplier Part been a Warranted Part except that, for obligations
covered under Clause 12.1, the shorter of (i) the Supplier's warranty
period indicated in the Supplier Product Support Agreements manual and
(ii) the Seller's warranty period indicated in Clause 12.1.3 of this
Agreement will apply.
12.3.2.2 In the event that any Supplier under any Supplier service life policy
obtained by the Seller pursuant to Clause 12.3.1 hereof defaults in the
performance of any material
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obligation with respect thereto, and the Buyer submits within
reasonable time to the Seller reasonable proof that such default has
occurred, then Clause 12.2 of this Agreement will apply to the extent
the same would have applied had such component, equipment, accessory or
part been listed in Exhibit C hereto.
12.3.2.3 At the Seller's request, the Buyer will assign to the Seller, and the
Seller will be subrogated to, all of the Buyer's rights against the
relevant Supplier, with respect to and arising by reason of such
default and the Buyer will provide reasonable assistance to enable the
Seller to enforce the rights so assigned.
12.4 INTERFACE COMMITMENT
12.4.1 INTERFACE PROBLEM
If the Buyer experiences any technical problem in the operation of an
Aircraft or its systems due to a malfunction, the cause of which, after
due and reasonable investigation, is not readily identifiable by the
Buyer, but which the Buyer reasonably believes to be attributable to
the design characteristics of one or more components of the Aircraft
(an "Interface Problem"), the Seller will, if requested by the Buyer,
and without additional charge to the Buyer, except for transportation
of the Seller's personnel to the Buyer's facilities, 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 due and reasonable
investigation, that the Interface Problem was due to or caused by any
act or omission of the Buyer in performance of its obligations
hereunder, the Buyer will pay to the Seller all reasonable costs and
expenses incurred by the Seller during such investigation. The Buyer
will furnish to the Seller all data and information in the Buyer's
possession relevant to the Interface Problem and will 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 Buyer 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 the Buyer, correct the design of such Warranted Part,
pursuant to the terms and conditions of Clause 12.1.
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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, if
requested by the Buyer, reasonably assist the Buyer in processing any
warranty claim the Buyer may have against the manufacturer of such
Supplier Part.
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 the Buyer, seek
a solution to the Interface Problem through cooperative efforts of the
Seller and any Supplier involved. The Seller will promptly advise the
Buyer of any corrective action proposed by the Seller and any such
Supplier. Such proposal will be consistent with any then existing
obligations of the Seller hereunder and of any such Supplier to the
Buyer. Such corrective action, unless reasonably rejected by the Buyer,
will constitute full satisfaction of any claim the Buyer may have
against either the Seller or any such Supplier with respect to such
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 the 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
22.5.
12.5 EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY
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 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 OR SERVICE DELIVERED UNDER THIS AGREEMENT.
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THE BUYER RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES IN THIS
CLAUSE 12 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYER FROM ANY
DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS AND
SERVICES SUPPLIED UNDER THIS AGREEMENT. THE BUYER HEREBY WAIVES,
RELEASES AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS, GUARANTEES
AND LIABILITIES OF THE SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES
OF THE 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 OR SERVICE DELIVERED 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;
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(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;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE ABOVE LIMITATIONS WILL NOT BE INTERPRETED TO IMPAIR THE WARRANTIES
GRANTED TO THE BUYER HEREUNDER.
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 BUYER. 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.
12.6 DUPLICATE REMEDIES
The remedies provided to the Buyer under this Clause 12 as to any
defect in respect of the Aircraft or any part thereof are mutually
exclusive and not cumulative. The Buyer will be entitled to the remedy
that provides the maximum benefit to it, as the Buyer may elect,
pursuant to the terms and conditions of this Clause 12 for any such
particular defect for which remedies are provided under this Clause 12;
provided, however, that the Buyer will not be entitled to elect a
remedy under one part of this Clause 12 that constitutes a duplication
of any remedy elected by it under any other part hereof for the same
defect. The Buyer's 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 Buyer
expends in procuring a correction or replacement for any covered part
subject to a defect or nonperformance covered by this Clause 12, and
the Buyer will not 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 Buyer in respect of the Seller's rights
against and obligations to the Manufacturer under the provisions quoted
above, the Buyer 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
Exclusivity
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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 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 OR SERVICE DELIVERED UNDER THIS AGREEMENT.
THE BUYER RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES IN THIS
CLAUSE 12 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYER FROM ANY
DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS AND
SERVICES SUPPLIED UNDER THIS AGREEMENT. THE BUYER HEREBY WAIVES,
RELEASES AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS, GUARANTEES
AND LIABILITIES OF THE SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES
OF THE 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 OR SERVICE DELIVERED 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 OR PART PROVIDED UNDER THIS AGREEMENT;
(b) LOSS OF, DAMAGE OF ANY KIND TO, ANY AIRCRAFT, COMPONENT,
EQUIPMENT, ACCESSORY OR PART PROVIDED UNDER THIS AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE ABOVE LIMITATIONS WILL NOT BE INTERPRETED TO IMPAIR THE WARRANTIES
GRANTED TO THE BUYER HEREUNDER.
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 BUYER. 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 Buyer under this Clause 12 as to any defect
in respect of the Aircraft or any part thereof are mutually exclusive and
not cumulative. The Buyer will be entitled to the remedy that provides the
maximum benefit to it, as the Buyer may elect, pursuant to the terms and
conditions of this Clause 12 for any such particular defect for which
remedies are provided under this Clause 12; provided, however, that the
Buyer will not be entitled to elect a remedy under one part of this Clause
12 that constitutes a duplication of any remedy elected by it under any
other part hereof for the same defect. The Buyer's 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 Buyer expends in procuring a correction or replacement
for any covered part subject to a defect or nonperformance covered by this
Clause 12, and the Buyer will not have any right to require specific
performance by the Seller.
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12.7 NEGOTIATED AGREEMENT
The Buyer and Seller agree that this Clause 12 has been the subject
of discussion and negotiation and is fully understood by the parties
and that the price of the Aircraft and the other mutual agreements
of the parties 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 and General
Limitations of Liability provisions and the Duplicate Remedies
provisions set forth following Clause 12.6.
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13 - PATENT AND COPYRIGHT INDEMNITY
The Seller, in its capacity as "Buyer" under its arrangements with
the Manufacturer, has negotiated and obtained the following
indemnity against patent and copyright infringements from the
Manufacturer with respect to the Aircraft, subject to the terms,
conditions, limitations and restrictions (including, but not limited
to, the waiver, release and renunciation provision) all as
hereinafter set out. The Seller hereby assigns to the Buyer, and the
Buyer hereby accepts, all of the rights and obligations of the
Seller in its capacity as "Buyer" as aforesaid under the said Patent
Indemnity and the Seller subrogates the Buyer into all such rights
and obligations in respect of the Aircraft. The Seller hereby
warrants to the Buyer that it has all requisite authority to make
the foregoing assignment and effect the foregoing subrogation to and
in favor of the Buyer and that it will not enter into any amendment
of the provisions so assigned without the prior written consent of
the Buyer. Capitalized terms utilized in the following provisions
have the meanings assigned thereto in this Agreement, except that
the term "Seller" refers to the Manufacturer and the term "Buyer"
refers to the Seller.
QUOTE
13.1 INDEMNITY
13.1.1 Subject to the provisions of Clause 13.2.3, the Seller will
indemnify the Buyer 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; and
(ii) any patent issued under the laws of any other country in which
the Buyer 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 (the "Paris
Convention"); 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) parts supplied pursuant to a Supplier Product Support
Agreement; or
(iv) software not created by the Seller.
13.1.3 In the event that the Buyer, due to circumstances contemplated in
Clause 13.1.1 is 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 the Buyer), the Seller
will at its expense either
(i) procure for the Buyer 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 noninfringing substitute.
13.2 ADMINISTRATION OF PATENT AND COPYRIGHT INDEMNITY CLAIMS
13.2.1 If the Buyer receives a written claim or a suit is threatened or begun
against the Buyer for infringement of a patent or copyright referred to
in Clause 13.1, the Buyer will
(i) forthwith notify the Seller, giving particulars thereof;
(ii) furnish to the Seller all data, papers and records within the
Buyer's 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 the Buyer from paying the
sums that may be required to obtain the release of the
Aircraft, provided that
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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;
(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 The Seller will be entitled either in its own name or on behalf of
the Buyer 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 the Buyer with the terms of this Clause and
is in lieu of any other liability to the Buyer, whether express or
implied, which 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 Buyer in respect of the
Seller's rights against and obligations to the Manufacturer under
the provisions quoted above, the Buyer 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 THE BUYER 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 THE 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
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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 BUYER.
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14 - TECHNICAL DATA AND DOCUMENTATION
14.1 GENERAL
This Clause covers the terms and conditions for the supply of Technical
Data and Documentation. The Technical Data and Documentation will be
supplied in the English language using aeronautical terminology in
common use.
14.2 SCOPE
Range, form, type, format, ATA/non-ATA compliance, revision and
quantity of the Technical Data and Documentation are covered in Exhibit
F hereto.
14.3 DELIVERY
The Technical Data and Documentation and corresponding revisions to be
supplied by the Seller will be sent to one address only as advised by
the Buyer.
Technical Data and Documentation and their revisions will be packed and
shipped by the quickest transportation methods. Shipment will be Free
Carrier (FCA) Toulouse, France and/or Free Carrier (FCA) Hamburg,
Germany.
The delivery schedule of the Technical Data and Documentation will be
phased as mutually agreed to correspond with Aircraft deliveries. The
Buyer agrees to provide forty (40) days' notice when requesting a
change to the delivery schedule.
The Buyer will coordinate and satisfy local Aviation Authorities needs
for the Technical Data and Documentation.
14.4. REVISION SERVICE
14.4.1 GENERAL
Unless otherwise specifically stated, revision service will be offered
free of charge for three (3) years after delivery of the last Aircraft.
Mandatory changes will be incorporated into the Technical Data and
Documentation [****].
14.4.2 SERVICE BULLETINS (SB)
Service Bulletin information will be incorporated into the Technical
Data and Documentation after the Buyer's notice to the Seller that the
Buyer intends to
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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embody a Service Bulletin. The pre- and post--Technical Data and
Documentation for the corresponding Service Bulletin will remain in the
Technical Data and Documentation until the Buyer notifies the Seller
that it has embodied the Service Bulletin on all the Aircraft. This
Clause only applies to the following Technical Data and Documentation:
-Aircraft Maintenance Manual
-Illustrated Parts Catalog
-Trouble Shooting Manual
-Wiring Manual (Schematics, Wirings, Lists)
14.4.3 CUSTOMER ORIGINATED CHANGES
14.4.3.1 Customer Originated Changes (COC) data may be incorporated into the
following customized Technical Data and Documentation:
-Aircraft Maintenance Manual
-Illustrated Parts Catalog
-Trouble Shooting Manual
-Wiring Manual (Schematics, Wirings, Lists)
COC data will be established by the Buyer according to the "Guidelines
for Customer Originated Changes" issued by the Seller.
The COC data will be labeled "COC" to show that they are Buyer
originated. The Seller will endeavor to incorporate COC data into the
customized Technical Data and Documentation within two (2) revisions
following the receipt of complete and accurate data for processing.
COC data will be incorporated by the Seller in all affected customized
Technical Data and Documentation, unless the Buyer specifies in writing
into which Technical Data and Documentation the COC data will be
incorporated. The customized Technical Data and Documentation into
which the COC data are incorporated will only show the Aircraft
configuration that reflects the COC data and not the configuration
before incorporation of the COC data.
14.4.3.2 The Buyer will ensure that any such data have received prior agreement
from its local Aviation Authorities.
14.4.3.3 The Buyer hereby acknowledges and accepts that the incorporation of any
COC into the Technical Data and Documentation issued by the Seller will
be entirely at the Buyer's risk. Accordingly, the Seller will be under
no liability whatsoever in
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respect of either the contents of any COC, including any omissions or
inaccuracies therein, or the effect that the incorporation of such COC
may have on the Technical Data and Documentation.
The Seller will not be required to check any COC data submitted for
incorporation as aforesaid.
Further, the Buyer acknowledges full liability for the effects,
including all related costs, that any COC may have on all subsequent
Service Bulletins and modifications.
14.4.3.4 In the event that the Seller is required under any judgment or
settlement to indemnify any third party for injury, loss or damage
incurred directly or indirectly as a result of incorporation of any
COC into the Technical Data and Documentation issued by the Seller, the
Buyer agrees to reimburse the Seller for all payments or settlements
made in respect of such injury, loss or damage including any expenses
(including reasonable legal fees) incurred by the Seller in defending
such claims.
The Seller's liability will in no event be affected by any
communication, whether written or oral, that the Seller may make to the
Buyer with respect to such documentation.
14.4.3.5 The Seller's costs with respect to the incorporation of any COC will be
invoiced to the Buyer under conditions specified in ASCO's Customer
Services Catalog in effect at the time of the Buyer's request for
incorporation.
14.5 SUPPLIER EQUIPMENT
Information relating to Supplier equipment that is installed on the
Aircraft by the Seller will be included free of charge in the basic
issue of the Technical Data and Documentation to the extent necessary
for the understanding of the systems concerned.
The Buyer will supply to the Seller the data related to Buyer Furnished
Equipment and to any other equipment not covered in the Seller's
Standard Furnished Equipment definition at least six (6) months before
the scheduled delivery of the customized Technical Data and
Documentation. The Buyer will supply these data in English.
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The Seller will introduce into the basic issue of the Technical Data
and Documentation the data related to Buyer Furnished Equipment. Costs
for shipping these data will be the Buyer's responsibility.
14.6 AIRCRAFT IDENTIFICATION TECHNICAL DATA AND DOCUMENTATION
For the customized Technical Data and Documentation the Buyer agrees to
the allocation of Fleet Serial Numbers (FSNs) in the form of a block of
numbers selected in the range from 001 to 999.
The sequence will be interrupted only if two (2) different Propulsion
Systems or different Aircraft models are selected.
The Buyer will indicate to the Seller the FSN allocated to the Aircraft
Manufacturer's Serial Number (MSN) within forty-five (45) days after
execution of this Agreement. The allocation of FSNs to MSNs will not
constitute any proprietary, insurable or other interest of the Buyer in
any Aircraft before delivery of and payment for Aircraft as provided in
this Agreement.
The affected customized Technical Data and Documentation are:
- Aircraft Maintenance Manual
- Illustrated Parts Catalog
- Trouble Shooting Manual
- Wiring Manual (Schematics, Wirings, Lists)
14.7 PERFORMANCE ENGINEER'S PROGRAMS
Complementary to the standard Operational Manuals, covered in Exhibit F
hereto, the Seller will provide to the Buyer Performance Engineer's
Programs (PEPs) under license conditions defined in Exhibit F hereto.
14.8 CD-ROM
Certain Technical Data and Documentation are provided on CD-ROM under
license conditions defined in Exhibit F hereto.
The affected Technical Data and Documentation are the following:
- Trouble Shooting Manual
- Aircraft Maintenance Manual
- Illustrated Parts Catalog
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From time to time, the Seller may extend this list to include other
Technical Data and Documentation and related license conditions
specified by the Seller.
14.9 WARRANTIES
The Seller warrants that the Technical Data and Documentation are
prepared in accordance with the state of the art at the date of their
conception. Should any of the Technical Data and Documentation prepared
by the Seller contain error or omission, the sole and exclusive
liability of the Seller will be to take all reasonable and proper steps
to, at its option, correct or replace any such Technical Data and
Documentation. Notwithstanding the above, no warranties of any kind are
given for the Customer Originated Changes addressed in Clause 14.4.3.
The provisions of Clauses 12.5, 12.6 and 12.7 will apply to all
Technical Data and Documentation.
14.10 PROPRIETARY RIGHTS
14.10.1 All proprietary rights, including but not limited to patent, design
and copyrights, relating to Technical Data and Documentation will
remain with the Seller. All such Technical Data and Documentation are
supplied to the Buyer for the sole use of the Buyer, who undertakes not
to divulge the contents thereof to any third party save as permitted
therein or otherwise pursuant to any governmental or legal requirement
imposed on the Buyer.
These proprietary rights will also apply to any translation into a
language or languages or media that may have been performed or caused
to be performed by the Buyer.
14.10.2 Whenever this Agreement provides for manufacturing by the Buyer, the
consent given by the Seller will not be construed as express or
implicit approval of the manufactured products. The supply of the
Technical Data and Documentation will not be construed as any further
right for the Buyer to design or manufacture any Aircraft or part
thereof or spare part.
14.10.3 If the Seller authorizes the disclosure of any of the Technical Data
and Documentation to third parties, either under this Agreement or by
an express prior written authorization, the Buyer will undertake that
such third party agree to be bound by the same conditions and
restrictions as the Buyer with respect to the Technical Data and
Documentation.
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15 - FIELD ASSISTANCE
15.1 SELLER'S SERVICE
The Seller will provide or cause to be provided at no charge to the
Buyer the services described in this Clause 15, at the Buyer's main base
or at other locations to be mutually agreed.
15.1.1 The Seller will provide a Resident Customer Support Representative
starting at or about delivery of the first Aircraft and continuing for
as long as at least five (5) Aircraft are in operation in the Buyer's
fleet.
15.1.2 The Seller will also provide free of charge the services of a team of
Customer Support Representatives acting in an advisory capacity at the
Buyer's main base starting at or about delivery of the first Aircraft
for a total of [****] man-months. The actual number of Customer
Support Representatives assigned to the Buyer at any one time will be
mutually agreed, but will not exceed three (3) persons.
15.1.3 The Seller has set up a global technical services network available for
the nonexclusive use of operators of aircraft manufactured by the
Manufacturer. The Buyer will have free access to this global network at
any time in the course of its operation of the Aircraft. In
particular, the Buyer will have access to the regional Customer Support
Representatives closest to the Buyer's main base after the end of the
period referred to above in Clause 15.1.1, or to cover for the
temporary absence of the Customer Support Representative(s). A list of
the contacts for the global technical services network, including the
regional Customer Support Representatives, will be provided to the
Buyer.
15.2 CUSTOMER SUPPORT DIRECTOR
The Seller will provide the services of one (1) Customer Support
Director based in Herndon, Virginia, to liaise between the Manufacturer
and the Buyer on product support matters after signature of this
Agreement for as long as the Buyer operates at least one (1) Aircraft.
15.3 BUYER'S SERVICE
15.3.1 For as long as the Customer Support Representative(s) specified in
Clause 15.1.1 above remain(s) with the Buyer, the Buyer will furnish
without charge secretarial assistance, suitable office space, office
equipment and facilities in or conveniently near the Buyer's
maintenance facilities. The Buyer will provide
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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[****]
15.3.2 In accordance with the Buyer's regulations, the Buyer will provide at no
charge to the Seller
(i) airline tickets in business class confirmed and guaranteed
between the locations mentioned above in Subclause 15.1 and
the international airport nearest Toulouse, France, that is on
the Buyer's network for the Customer Support Representative(s)
mentioned in Subclause 15.1.1; and
(ii) when said Customer Support Representative(s) are assigned away
from the locations mentioned above in Subclause 15.1 at the
Buyer's request, transportation between the said locations and
the place of assignment.
15.3.3 The parties will give each other all necessary reasonable assistance
with general administrative functions specific to their respective
countries and procurement of the documents necessary to live and work
there.
15.4 REPRESENTATIVES' STATUS
In providing the above technical service, the Seller's employees,
including Customer Support Representative(s) and the Customer Support
Director, are deemed to be acting in an advisory capacity only and at
no time will they be deemed to be acting, either directly or
indirectly, as the Buyer's employees or agents.
15.5 TEMPORARY ASSIGNMENT OF CUSTOMER SUPPORT REPRESENTATIVE
The Buyer agrees that the Seller will have the right to transfer or
recall any Customer Support Representative(s) on a temporary or
permanent basis. The Buyer will receive credit for the man-days during
which any Customer Support Representative is absent from the Buyer's
facility pursuant to this Clause 15.5.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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16 - TRAINING AND TRAINING AIDS
16.1. GENERAL
This Clause covers the terms and conditions for the supply of training
and training aids for the Buyer's personnel to support the Aircraft
operation.
16.2. SCOPE
16.2.1 The range and quantities of training and training aids to be provided
free of charge under this Agreement are covered in Appendix A to this
Clause 16. The Seller will arrange availability of such training and
training aids in relation to the delivery of the Aircraft.
16.2.2 The contractual training courses, defined in Appendix A to this Clause
16, will be provided up to one (1) year after delivery of the last
Aircraft.
16.2.3 In the event that the Buyer should use none or only part of the
training or training aids to be provided pursuant to this Clause, no
compensation will be provided, but a credit may be mutually agreed.
16.3. TRAINING ORGANIZATION / LOCATION
16.3.1 The Seller will provide the training at the Airbus Training Center in
Miami, Florida, or one of its affiliated training centers.
16.3.2 In the event of the nonavailability of facilities or scheduling
imperatives making training by the Seller impractical, the Seller will
make arrangements for the provision to the Buyer of such training
support elsewhere.
16.3.3 Upon the Buyer's request the Seller may also provide certain training
at one of the Buyer's bases, if and when practicable for the Seller,
under terms and conditions to be mutually agreed upon. In this event,
all additional charges listed in Clause 16.6.2 will be borne by the
Buyer.
16.4 TRAINING COURSES
16.4.1 Training courses, as well as the minimum and maximum numbers of
trainees per course provided for the Buyer's personnel, are defined in
the Seller's applicable Training Course Catalog and will be scheduled
as mutually agreed upon during a training conference (the "Training
Conference") to be held at least twelve (12) months prior to delivery
of the first Aircraft.
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16.4.2 The following terms will apply when training is performed by the
Seller:
(i) Training courses will be the Seller's standard courses as
described in the Seller's current Training Course Catalog. The
Seller will be responsible for all training course syllabi,
training aids and training equipment necessary for the
organization of the training courses.
(ii) The training curricula and the training equipment may not be
fully customized. However, academic curricula may be modified
to include the most significant aspects of the Specification
(to the exclusion of Buyer Furnished Equipment) as known at
the latest six (6) months prior to the date of the first
training course planned for the Buyer. The equipment used for
training of flight and maintenance personnel will not be fully
customized; however, this equipment will be configured in
order to obtain the relevant Aviation Authority's approval and
to support the Seller's teaching programs. Training data and
documentation will not be revised.
(iii) Training data and documentation necessary for training
detailed in Appendix A to this Clause 16 will be
free-of-charge. Training data and documentation will be marked
"FOR TRAINING ONLY" and as such will be supplied for the sole
and express purpose of training.
(iv) Upon the request of the Buyer, the Seller will collect and
pack for consolidated shipment to the Buyer's facility, all
training data and documentation of the Buyer's trainees
attending training at the Airbus Training Center in Miami,
Florida, at no charge to the Buyer, with shipment by Free
Carrier (FCA) Miami International Airport. It is understood
that title to and risk of loss of said shipment will pass to
the Buyer upon delivery.
16.4.3 In the event the Buyer decides to cancel or reschedule a training
course, a minimum advance notice of sixty (60) calendar days will be
required. Any later cancellation or change, when courses cannot be
allocated to other customers, will be deducted from the training
allowances defined herein or will be charged to the Buyer, as
applicable.
16.4.4 In fulfillment of its obligation to provide training courses, when the
Seller performs the training courses, the Seller will deliver to the
trainees a certificate of completion at the end of any such training
course. The Seller's certificate does not represent authority or
qualification by any official Aviation Authorities but may be presented
to such officials in order to obtain relevant formal qualification.
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In the event that training is provided by a training provider selected
by the Seller, the Seller will cause such training provider to deliver
a certificate of completion at the end of any such training course.
Such certificate will not represent authority or qualification by any
official Aviation Authorities but may be presented to such officials in
order to obtain relevant formal qualification.
16.5 PREREQUISITES
16.5.1 Training will be conducted in English and all training aids and
materials are written in English using common aeronautical terminology.
Trainees must have the prerequisite jet transport category experience
as defined in Appendix B to this Clause 16.
It is clearly understood that the Seller's training courses are
"Transition Training Courses" and not "Ab Initio Training Courses."
Furthermore, the Buyer will be responsible for the selection of the
trainees and for any liability with respect to the entry knowledge
level of the trainees.
16.5.2 The Buyer will provide the Seller with an attendance list of the
trainees for each course with the validated qualification of each
trainee. The Seller reserves the right to check the trainees'
proficiency and previous professional experience. The Seller will in no
case warrant or otherwise be held liable for any trainee's performance
as a result of any training services provided.
16.5.3 Upon the Buyer's request, the Seller may be consulted to direct the
above mentioned trainee(s) through a relevant entry level training
program, which will be at the Buyer's charge, and, if necessary, to
coordinate with competent outside organizations for this purpose. Such
consultation will be held during the Training Conference.
In the event the Seller should determine that a trainee lacks the
required entry level, such trainee will, following consultation with
the Buyer, be withdrawn from the program and will then be considered to
be at the Buyer's disposal.
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16.6. LOGISTICS
16.6.1 TRAINEES
16.6.1.1 When training is done at the Airbus Training Center in Blagnac, France,
the Seller will provide free local transportation by bus for the
Buyer's trainees to and from designated pick up points and the training
center.
16.6.1.2 When training is done at the Airbus Training Center in Miami, Florida,
the Seller will provide a free-of-charge rental car for all of the
Buyer's trainees at the beginning of the training course on the basis
of one rental car per four trainees and one rental car per each flight
crew.
The Seller will provide rental cars with unlimited mileage, and the
Buyer will pay for gas, and fines, if any. However, the Buyer will
indemnify and hold the Seller harmless from and against all
liabilities, claims, damages, costs and expenses for any injury to or
death of any of the Buyer's trainees occasioned during the course of
such transportation.
16.6.1.3 Living expenses for the Buyer's trainees are to be borne by the Buyer.
16.6.2 TRAINING AT EXTERNAL LOCATION
16.6.2.1 SELLER'S INSTRUCTORS
In the event that training is provided by the Seller's instructors at
any location other than the Seller's training centers, the Buyer will
reimburse the Seller for all the expenses, defined below in Clauses
16.6.2.2, 16.6.2.3, 16.6.2.4 and 16.6.2.5 related to the assignment of
such instructors and their performance of the duties as aforesaid.
16.6.2.2 LIVING EXPENSES
Such expenses, covering the entire period from day of secondment to day
of return to the Seller's base, will include but will not be limited to
lodging, food and local transportation to and from the place of lodging
and the training course location. The Buyer will reimburse the Seller
for such expenses on the basis of a per diem rate corresponding to the
current per diem rate used by the Seller for its personnel.
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16.6.2.3 AIR TRAVEL
The Buyer will reimburse the Seller for the costs of the Seller's
instructors in confirmed business class or in confirmed coach class,
where business class is not available, to and from the Buyer's
designated training site and the Seller's training center.
16.6.2.4 INSTRUCTOR'S MATERIAL
The Buyer will reimburse the Seller for the cost of shipping the
instructor's material needed to conduct such courses.
16.6.2.5 TRANSPORTATION SERVICES
The Buyer will be solely liable for any and all delay in the
performance of the training outside of the Seller's training centers
associated with the transportation services described above and will
indemnify and hold the Seller harmless from such delay and any
consequences arising therefrom.
16.6.2.6 TRAINING EQUIPMENT AVAILABILITY
Training equipment necessary for course performance at any course
location other than the Seller's training centers or the facilities of
the training provider selected by the Seller will be provided by the
Buyer in accordance with the Seller's specifications.
16.7 FLIGHT OPERATIONS TRAINING
16.7.1 FLIGHT CREW TRAINING COURSE
16.7.1.1 The Seller will perform a flight crew training course program (regular
transition program or a cross-crew qualification program as applicable)
for the Buyer's flight crews, each of which will consist of one captain
(1) and one (1) first officer, as defined in Appendix A to this Clause
16. The training manual used will be the Seller's Flight Crew Operating
Manual.
16.7.1.2 The Buyer will use its delivered Aircraft for any required Aircraft
in-flight training. This training will not exceed one (1) session of
one and a half (1.5) hours per pilot. When Aircraft in-flight crew
training is performed in Blagnac, France, the Seller will provide
free-of-charge line maintenance, including servicing, preflight checks
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and changing of minor components, subject to conditions agreed in the
present Agreement.
16.7.1.3 The Buyer will provide mutually agreed spare parts as required to
support said Aircraft in-flight training and will provide insurance in
line with Clause 16.12.
16.7.1.4 In all cases, the Buyer will bear all expenses such as fuel, oil and
landing fees.
16.7.2. FLIGHT CREW LINE INITIAL OPERATING EXPERIENCE
16.7.2.1 In order to assist the Buyer with initial operating experience after
delivery of the first Aircraft, the Seller will provide to the Buyer
pilot instructor(s) as defined in Appendix A to this Clause 16.
16.7.2.2 The Buyer will reimburse the expenses for each such instructor in
accordance with Clause 16.6.2. Additional pilot instructors can be
provided at the Buyer's expense and upon conditions to be mutually
agreed upon.
16.7.3 CABIN ATTENDANTS' FAMILIARIZATION COURSE
The Seller will provide cabin attendants' course(s) to the Buyer's
cabin attendants, as defined in Appendix A to this Clause 16.
The cabin attendants' course, when incorporating the features of the
Aircraft, can be given at the earliest two (2) weeks before the
delivery date of the first Aircraft.
16.7.4. PERFORMANCE / OPERATIONS COURSE
The Seller will provide performance/operations training for the Buyer's
personnel as defined in Appendix A to this Clause 16.
The available courses are listed in the Seller's applicable Training
Course Catalog.
16.8 MAINTENANCE TRAINING
16.8.1 The Seller will provide maintenance training for the Buyer's ground
personnel as defined in Appendix A to this Clause 16.
The available courses are listed in the Seller's applicable Training
Course Catalog.
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16.8.2 ON-THE-JOB TRAINING
Upon the Buyer's request, the Seller may be consulted to identify
competent outside organizations to provide on-the-job training, which
will be at the Buyer's charge.
16.8.3 LINE MAINTENANCE INITIAL OPERATING EXPERIENCE TRAINING
In order to assist the Buyer during the entry into service of the
Aircraft, the Seller will provide to the Buyer maintenance
instructor(s) at the Buyer's base as defined in Appendix A to this
Clause 16.
16.8.3.1 This line maintenance initial operating experience training will cover
training in handling and servicing of Aircraft, flight crew /
maintenance coordination, use of documentation, CAATS, ADRES, and/or
any other activities which may be deemed necessary after delivery of
the first Aircraft.
16.8.3.2 The Buyer will reimburse the expenses for said instructor(s) in
accordance with Clause 16.6.2. Additional maintenance instructors can
be provided at the Buyer's expense.
16.9 SUPPLIER AND ENGINE MANUFACTURER TRAINING
A copy of the Supplier Training Catalogue, listing the suppliers that
provide training, will be supplied to the Buyer on request.
16.10 TRAINING AIDS AND MATERIALS FOR THE BUYER'S TRAINING ORGANIZATION
16.10.1 The Seller will provide to the Buyer the Airbus Computer Based Training
(CBT) System, training aids and material, as used in the Seller's
training centers, free of charge as defined in Appendix A to this
Clause 16.
The Airbus CBT System, training aids and material supplied to the Buyer
will be similar to those used in the Manufacturer's training centers
for the training provided for the Buyer. The Seller has no obligation
to cause the Manufacturer to revise the Airbus CBT System.
16.10.2 DELIVERY
16.10.2.1 The Seller will deliver to the Buyer the Airbus CBT System, training
aids and materials as defined in Appendix A to this Clause 16, at a
date to be mutually agreed during the Training Conference.
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16.10.2.2 Those items supplied to the Buyer pursuant to Clause 16.10.1 above
will be delivered FCA Toulouse, Blagnac Airport. Title to and risk of
loss of said items will pass to the Buyer upon delivery.
16.10.2.3 All costs related to transportation and insurance of said items from
the FCA point to the Buyer's facilities will be at the Buyer's
expense.
16.10.3 INSTALLATION
16.10.3.1 Upon the Buyer's request, the Seller may assist the Buyer with the
initial installation of the Airbus CBT System at the Buyer's facility
following notification in writing that the various components, which
are in accordance with specifications defined in the Airbus CBT
Technical Catalog, are ready for installation and available at the
Buyer's facility.
16.10.3.2 The Buyer will provide any and all the necessary hardware on which the
Airbus CBT System will be installed and Seller will not be responsible
for any incompatibility of such hardware with the Airbus CBT System.
16.10.3.3 The Airbus CBT System will be installed by the Buyer's personnel who
have completed the Airbus CBT training, and the Seller will be held
harmless from any damage to person and/or to property caused by or in
any way connected with the handling and/or installation of the Airbus
CBT System by the Buyer's personnel.
16.10.3.4 The Buyer will reimburse the expenses in accordance with Clause
16.6.2, for the Seller's personnel required at the Buyer's facility to
conduct Airbus CBT Training and/or provide installation assistance.
16.10.4 LICENSE
16.10.4.1 The Seller will grant the Buyer a license to use the Airbus CBT
System, as defined in Appendix C to this Clause 16.
16.10.4.2 Supply of additional sets of courseware supports, as well as any
extension to the license for such courseware, will be subject to terms
and conditions to be mutually agreed.
16.10.5 The Seller will not be responsible and hereby disclaims any and all
liabilities resulting from or in connection with the use by the Buyer
of the training aids and materials at the Buyer's facilities.
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16.11 PROPRIETARY RIGHTS
The Seller's training data and documentation, Airbus CBT System,
training aids and material are proprietary to the Manufacturer and its
suppliers and the Buyer agrees not to disclose the content of the
courseware or any information or documentation provided by the Seller
in relation to training in whole or in part, to any third party
without the prior written consent of the Seller.
16.12 INDEMNIFICATION AND INSURANCE
Indemnification provisions and insurance requirements are as set forth
in Clause 19.
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APPENDIX A TO CLAUSE 16
TRAINING ALLOWANCE
1. FLIGHT OPERATIONS TRAINING
1.1 FLIGHT CREW TRAINING
The Seller will provide flight crew training (regular transition or
CCQ as applicable) free of charge for [****] of the Buyer's
flight crews and [****] of the Buyer's instructor flight crews.
The Seller will [****].
1.2 FLIGHT CREW LINE INITIAL OPERATING EXPERIENCE
The Seller will provide to the Buyer pilot instructor(s) free of
charge for a period of one (1) pilot instructor month.
1.2.1 The maximum number of pilot instructors present at any one time will
be limited to two (2) pilot instructors.
1.3 CABIN ATTENDANTS' FAMILIARIZATION COURSE
The Seller will provide to the Buyer cabin attendants' training free
of charge for twenty-four (24) of the Buyer's cabin attendants.
1.4 PERFORMANCE / OPERATIONS COURSE(S)
1.4.1 The Seller will provide to the Buyer two hundred (200) trainee days of
performance/operations training free of charge for the Buyer's
personnel.
1.4.2 The above trainee days will be used solely for the
performance/operations training courses as defined in the Seller's
applicable Training Course Catalog.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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2. MAINTENANCE TRAINING
2.1 MAINTENANCE TRAINING COURSES
2.1.1 The Seller will provide to the Buyer [****] trainee days of
maintenance training free of charge for the Buyer's personnel.
2.1.2 The above trainee days will be used solely for the Maintenance
training courses as defined in the Seller's applicable Training Course
Catalog.
2.1.3 Notwithstanding the trainee days allowance in Clause 2.1.1.1 above,
the number of Engine Run-up courses will be limited to one (1) course
for three (3) trainees per Firm Aircraft.
2.2 LINE MAINTENANCE INITIAL OPERATING EXPERIENCE TRAINING
The Seller will provide to the Buyer maintenance instructor(s) at the
Buyer's base free of charge for a period of thirty (30) weeks.
3. TRAINEE DAYS ACCOUNTING
Trainee days are counted as follows:
- For instruction at the Seller's training centers, one (1)
day of instruction for one (1) trainee equals one (1)
trainee day, and the number of trainees at the beginning of
the course will be counted as the number of trainees
considered to have taken the course.
- For instruction outside of the Seller's training centers,
one (1) day of secondment of one (1) Seller instructor
equals the actual number of trainees attending the course
or a minimum of twelve (12) trainee days.
4. TRAINING AIDS AND MATERIALS FOR BUYER'S TRAINING ORGANIZATION
4.1 The Seller will provide to the Buyer one (1) Airbus CBT System as
defined in Clause 4.2 below, related to the Aircraft. The Seller will
also provide free of charge revision to courseware in Clause 4.2 below
for five (5) years after initial delivery of the courseware, when
developed by the Manufacturer.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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4.2 The Airbus CBT System supplied to the Buyer will consist of:
- One (1) Airbus CBT installation/utilization guide
- Scale 1/1 cockpit panel drawings (color)
- One (1) set of paper copy and one (1) reproducible CD ROM
- Scale 1/2 cockpit panel drawings (color)
- One (1) set of paper copy and one (1) reproducible CD ROM
- One (1) set of CD-ROM with run time software related to the
delivered courseware.
FOR FLIGHT OPERATIONS TRAINING:
The A320 flight crew Airbus CBT courseware will be delivered with:
- One (1) set of CD ROM with Airbus CBT courseware files
- One (1) set of training documentation master, whenever
applicable
- One (1) set of menu listings
- One (1) set of videodisks, whenever applicable
- One (1) set of Training Interface for Performance and Weight and
Balance (TIPWB)
FOR MAINTENANCE TRAINING:
The A320 maintenance Airbus CBT courseware will be delivered with:
- One (1) set of CD ROM with Airbus CBT courseware files
- One (1) set of training documentation master, whenever
applicable
- One (1) set of menu listings
- Six (6) sets of videodisks, whenever applicable
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MINIMUM RECOMMENDED QUALIFICATION
IN RELATION TO TRAINING REQUIREMENTS
(Regular Transition Courses)
The prerequisites listed below are the minimum recommended requirements
specified for Airbus training. If the appropriate regulatory agency or the
specific airline policy of the trainee demand greater or additional
requirements, they will apply as prerequisites.
- CAPTAIN PREREQUISITES
- Fluency in English
- 1500 hours minimum flying experience as pilot
- 1000 hours experience on FAR/JAR 25 aircraft
- 200 hours experience as airline, corporate pilot or military pilot
- Must have flown transport type aircraft, as flying pilot, within the
last 12 months.
- FIRST OFFICER PREREQUISITES
- Fluency in English
- 500 hours minimum flying experience as pilot of fixed wing aircraft
- 300 hours experience on FAR/JAR 25 aircraft
- 200 hours flying experience as airline pilot or a corporate pilot or
military pilot
- Must have flown transport type aircraft, as flying pilot, within the
last 12 months.
For both CAPTAIN and FIRST OFFICER, if one or several of the above
criteria are not met, the trainee must follow
(i) an adapted course (example: if not fluent in English, an adapted
course with a translator), or
(ii) an Entry Level Training (ELT) program before entering the
regular or the adapted course.
Such course(s), if required, will be at the Buyer's expense.
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- MAINTENANCE PERSONNEL PREREQUISITES
- Fluency in English
- Experience on first or second generation jet transport category
aircraft
- Knowledge of digital techniques, including ARINC 429, for
electrics / avionics specialists. If this criterion is not met
the trainee must follow a Basic Digital Course.
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APPENDIX C TO CLAUSE 16
LICENSE FOR USE OF AIRBUS COMPUTER BASED TRAINING
1. GRANT
The Seller grants the Buyer the right, pursuant to the terms and
conditions herein, to use the Airbus CBT System for the term (defined in
Clause 4 below) of this license (the "License").
2. DEFINITIONS
2.1 For the purpose of this Appendix C to Clause 16, the following
definitions will apply :
2.1.1 "Airbus CBT Courseware" means the programmed instructions that provide
flight crew and maintenance training.
2.1.2 "Airbus CBT Software" means the system software that permits the use of
the Airbus CBT Courseware.
2.1.3 "Airbus CBT System" means the combination of the Airbus CBT Software and
the Airbus CBT Courseware.
2.1.4 "Student/Instructor Mode" means the mode that allows the user to run the
Airbus CBT Courseware.
2.1.5 "Airbus CBT Training" means the training enabling the Buyer to load and
use the Airbus CBT System.
2.2 For the purpose of clarification, it is hereby stated that all related
hardware required for the operation of the Airbus CBT System is not part
of the Airbus CBT System and will be procured under the sole
responsibility of the Buyer.
3. COPIES
3.1 The Buyer will be permitted to copy the Airbus CBT Software for back-up
and archiving purposes and the loading of the Airbus CBT Software
exclusively on the Buyer's workstations. In such cases, the Buyer will
advise the Seller in writing stating the number and purpose of any
copies made. Any other copying is strictly prohibited.
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3.2 The Buyer agrees to reproduce the copyright and other notices as they
appear on or within the original media on any copies that the Buyer
makes of the Airbus CBT Software.
4. TERM
The rights under this License will be granted to the Buyer for as long
as the Buyer operates the aircraft model to which the Airbus CBT
Software and the Airbus CBT courseware apply. When the Buyer stops
operating said Aircraft model, the Buyer will return the Airbus CBT
System and any copies thereof to the Seller, accompanied by a note
certifying that the Buyer has returned all existing copies.
5. PERSONAL ON-SITE LICENSE
5.1 The above described License is personal to the Buyer for use of the
Airbus CBT System within the Buyer's premises only, and is
nontransferable and nonexclusive.
5.2 The Buyer may not (i) distribute or sublicense any portion of the Airbus
CBT System, (ii) modify or prepare derivative works from the Airbus CBT
Software, (iii) publicly display visual output of the Airbus CBT
Software, or (iv) transmit the Airbus CBT Software electronically by any
means.
6. CONDITIONS OF USE
6.1 USE OF THE AIRBUS CBT SOFTWARE
6.1.1 For the student delivery mode, the Buyer will use the Airbus CBT
Software for the exclusive purpose of
(i) rostering students for one or several courses syllabi in order
to follow students' progression,
(ii) rearranging course syllabi or creating new ones using available
courseware modules, it being understood that the Seller
disclaims any responsibility regarding any course(s) that may be
modified or rearranged by the Buyer.
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6.2 USE OF THE AIRBUS CBT COURSEWARE
6.2.1 The Buyer will use the Airbus CBT Courseware for the exclusive purpose
of performing training instructions for its personnel, or for third
party personnel contracted to perform work on the Aircraft on behalf of
the Buyer. Such training will be performed at the Buyer's facility or at
a subcontractor's facility provided it is conducted by the Buyer's
personnel.
7. PROPRIETARY RIGHTS AND NONDISCLOSURE
The Airbus CBT Software and Airbus CBT Courseware, the copyrights and
any and all other author rights, intellectual, commercial or industrial
proprietary rights of whatever nature in the Airbus CBT Software and
Airbus CBT Courseware are and will remain with the Seller or its
suppliers, as the case may be. The Airbus CBT Software and Airbus CBT
Courseware and their contents are designated as confidential. The Buyer
will not take any commercial advantage by copy or presentation to third
parties of the Airbus CBT Software, the documentation, the Airbus CBT
Courseware, and/or any rearrangement, modification or copy thereof.
The Buyer acknowledges the Manufacturer's proprietary rights in the
Airbus CBT System and undertakes not to disclose the Airbus CBT Software
or Airbus CBT Courseware or parts thereof or their contents to any third
party without the prior written consent of the Seller. Insofar as it is
necessary to disclose aspects of the Airbus CBT Software and Airbus CBT
Courseware to the Buyer's personnel, such disclosure is permitted only
for the purpose for which the Airbus CBT Software and Airbus CBT
Courseware are supplied to the Buyer under the License.
8. WARRANTY
8.1 The Seller warrants that the Airbus CBT System is prepared in accordance
with the state of the art at the date of its conception. Should the
Airbus CBT System be found to contain any nonconformity or defect, the
Buyer will notify the Seller promptly thereof and the sole and exclusive
liability of the Seller under this Clause 8.1 of the Airbus CBT License
will be to correct the same at its own expense.
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8.2 WAIVER, RELEASE AND RENUNCIATION
THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND
REMEDIES OF THE BUYER SET FORTH IN THIS LICENSE ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND THE BUYER HEREBY WAIVES, RELEASES AND
RENOUNCES, ALL OTHER WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE
SELLER AND RIGHTS, CLAIMS AND REMEDIES OF THE BUYER AGAINST THE
SELLER, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE WITH RESPECT
TO ANY NONCONFORMITY OR DEFECT IN AIRBUS CBT SYSTEM DELIVERED UNDER
THIS LICENSE INCLUDING BUT NOT LIMITED TO:
(A) ANY WARRANTY AGAINST HIDDEN DEFECTS;
(B) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;
(C) ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE
OF DEALING OR USAGE OF TRADE;
(D) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY, WHETHER
CONTRACTUAL OR IN TORT AND WHETHER OR NOT ARISING FROM THE
SELLER'S NEGLIGENCE, ACTUAL OR IMPUTED; AND
(E) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OR
DAMAGE TO ANY AIRCRAFT, COMPONENT, EQUIPMENT, ACCESSORY OR PART
THEREOF.
THE SELLER WILL HAVE NO OBLIGATION OR LIABILITY, HOWSOEVER ARISING, FOR
LOSS OF USE, REVENUE OR PROFIT OR FOR ANY OTHER DIRECT, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY NONCONFORMITY OR DEFECT IN THE
AIRBUS CBT SYSTEM DELIVERED UNDER THIS LICENSE.
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17 - EQUIPMENT SUPPLIER PRODUCT SUPPORT
17.1 EQUIPMENT SUPPLIER PRODUCT SUPPORT AGREEMENTS
17.1.1 The Seller has obtained product support agreements transferable to the
Buyer from Suppliers of Seller Furnished Equipment listed in the
Specification.
17.1.2 These agreements are based on the "World Airlines and Suppliers Guide"
and include Supplier commitments contained in the Supplier Product
Support Agreements, which include the following:
(i) Technical data and manuals required to operate, maintain,
service and overhaul the Supplier items will (a) be prepared in
accordance with the applicable provisions of ATA Specification
100 and 101 in accordance with Clause 14 of this Agreement, (b)
include revision service, and (c) be published in the English
language. The Seller recommends that software data, supplied in
the form of an appendix to the Component Maintenance Manual, be
provided in compliance with ATA Specification 102 up to level 3
to protect Supplier's proprietary interests.
(ii) Warranties and guarantees, including Suppliers' standard
warranties, and in the case of Suppliers of landing gear,
service life policies for selected landing gear structures.
(iii) Training to ensure efficient operation, maintenance and overhaul
of the Suppliers' items for the Buyer's instructors, shop and
line service personnel.
(iv) Spares data in compliance with ATA Specification 200 or 2000,
initial provisioning recommendations, spares and logistics
service, including routine and emergency deliveries.
(v) Technical service to assist the Buyer with maintenance,
overhaul, repair, operation and inspection of Supplier items
as well as required tooling and spares provisioning.
17.2 SUPPLIER COMPLIANCE
The Seller will monitor Supplier compliance with support commitments
defined in the Supplier Product Support Agreements and will take action
together with the Buyer if necessary.
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17.3 SUPPLIER PART REPAIR STATIONS
17.3.1 The Manufacturer has developed with the Suppliers a comprehensive
network of repair stations in North America for those Supplier Parts
originating from outside this territory.
As a result, most Supplier Parts are repairable in North America, and
corresponding repair stations are listed in the AOG and Repair Guide,
which is issued and regularly updated by the Manufacturer.
The Seller undertakes that the Supplier Parts that have to be forwarded
for repair outside North America will be sent back to the Buyer with
proper tagging as required by the FAA.
17.3.2 The Seller will support the Buyer in cases where the agreed repair turn
time of an approved repair station is not met by causing free-of-charge
loans or exchanges as specified in the relevant Supplier Product Support
Agreements to be offered to the Buyer.
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18 - BUYER FURNISHED EQUIPMENT
18.1 ADMINISTRATION
18.1.1 Without additional charge and in accordance with the Specification, the
Seller will cause the Manufacturer to provide for the installation of
the BFE, provided that the BFE is referred to in the Airbus BFE Catalog
of Approved Suppliers by Products valid at the time the BFE is ordered.
The Seller will cause the Manufacturer to advise the Buyer of the dates
by which, in the planned release of engineering for the Aircraft, the
Seller requires a written detailed engineering definition. This
description will include the description of the dimensions and weight of
BFE, the information related to its certification and information
necessary for the installation and operation thereof. The Buyer will
furnish such detailed description and information by the dates
specified. Thereafter, no information, dimensions or weights will be
revised unless authorized by an SCN.
The Seller will also furnish the Buyer in due time a schedule of dates
and shipping addresses for delivery of BFE and (when requested by the
Seller) additional spare BFE to permit installation of the BFE in the
Aircraft and delivery of the Aircraft in accordance with the delivery
schedule. The Buyer will provide the BFE by such dates in a serviceable
condition, to allow performance of any assembly, test, or acceptance
process in accordance with the industrial schedule.
The Buyer will also provide, when requested by the Seller, at
Aerospatiale works and/or at DASA works, adequate field service,
including support from BFE suppliers to act in a technical advisory
capacity to the Seller in the installation, calibration and possible
repair of any BFE.
18.1.2 The Seller will be entitled to refuse any item of BFE that it considers
incompatible with the Specification, the above-mentioned engineering
definition or the certification requirements.
18.1.3 The BFE will be imported into France or into Germany by the Buyer under
a suspensive customs system ("REGIME DE L'ENTREPOT INDUSTRIEL POUR
FABRICATION COORDONNEE" or "ZOLLVERSCHLUSS") without application of any
French or German tax or customs duty, and will be Delivered Duty Unpaid
(DDU) according to the Incoterms definition, to
AEROSPATIALE, Societe Nationale Industrielle
316 Route de Bayonne
31300 TOULOUSE
FRANCE
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or
DAIMLER CHRYSLER AEROSPACE AIRBUS GmbH
Division Hamburger Flugzeugbau
Kreetslag 10
21129 HAMBURG
FEDERAL REPUBLIC OF GERMANY
as provided in Clause 18.1.1.
18.1.4 If the Buyer requests the Seller to supply directly certain items that
are considered BFE according to the Specification, and if such request
is notified to the Seller in due time in order not to affect the
delivery date of the Aircraft, the Seller may agree to order such items
subject to the execution of an SCN reflecting the effect on price,
escalation adjustment, and any other conditions of the Agreement. In
such a case the Seller will be entitled to the payment of a reasonable
handling charge and will bear no liability in respect of delay and
product support commitments for such items.
18.2 AVIATION AUTHORITIES' REQUIREMENTS
The Buyer is responsible for, at its expense, and warrants that BFE will
(i) be manufactured by a qualified supplier, (ii) meet the requirements
of the applicable Specification, (iii) comply with applicable
requirements incorporated by reference to the Type Certificate and
listed in the Type Certificate Data Sheet, and (iv) be approved by the
Aviation Authorities delivering the Export Certificate of Airworthiness
and by the Buyer's Aviation Authority for installation and use on the
Aircraft at the time of Delivery of such Aircraft. The Seller will not
be liable for any expenses related to the foregoing warranty.
18.3 BUYER'S OBLIGATION AND SELLER'S REMEDIES
18.3.1 Any delay or failure in
(i) furnishing the BFE in serviceable condition at the requested
delivery date,
(ii) complying with the warranty in Clause 18.2 or in providing the
descriptive information or service representatives mentioned in
Clause 18.1.1, or
(iii) in obtaining any required approval for such equipment under the
above mentioned Aviation Authorities regulations
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may delay the performance of any act to be performed by the Seller, and
cause the Final Price of the Aircraft to be adjusted in accordance with
the updated delivery schedule, including, in particular, the costs the
Seller incurs that are attributable to the delay or failure described
above, such as storage, taxes, insurance and costs of out-of sequence
installation.
18.3.2 In addition to the consequences outlined in Clause 18.3.1, in the event
of a delay or failure described in Clause 18.3.1,
(i) the Seller may select, purchase and install equipment similar to
the BFE at issue, in which event the Final Contract Price of the
affected Aircraft will also be increased by the purchase price
of such equipment, plus reasonable costs and expenses incurred
by the Seller for handling charges, transportation, insurance,
packaging and, if required and not already provided for in the
price of the Aircraft, for adjustment and calibration; or
(ii) if the BFE is delayed more than thirty (30) days beyond, or
unapproved within thirty (30) days of the date pursuant to
Clause 18.1.1, then the Seller may deliver or the Buyer may
elect to have the Aircraft delivered without the installation of
such equipment, notwithstanding the terms of Clause 7.1 insofar
as it may otherwise have applied, whereon the Seller will be
relieved of all obligations to install such equipment.
18.4 TITLE AND RISK OF LOSS
Title to and risk of loss of BFE will at all times remain with the
Buyer, except that risk of loss (limited to cost of replacement of said
BFE and excluding in particular loss of use) will be with the Seller for
as long as the BFE is in the care, custody and control of the Seller.
18.5 SELLER FURNISHED EQUIPMENT
BFE that the Buyer chooses to convert to Seller Furnished Equipment will
be treated as BFE, and will be subject to the terms and conditions in
this Agreement applicable to BFE as though such Seller Furnished
Equipment had been originally ordered as BFE. Notwithstanding the
foregoing sentence, the Seller may only exercise its right and be
relieved of its obligations under Clause 18.3.2(ii) if BFE converted to
SFE is delayed more than thirty (30) days beyond or unapproved within
thirty (30) days of the date pursuant to Clause 18.1.1 due to the
Buyer's action or inaction.
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19- INDEMNITIES AND INSURANCE
19.1 SELLER'S INDEMNITIES
Except in the case of gross negligence or willful misconduct on the part
of the Buyer, its directors, officers, agents or employees, the Seller
will be solely liable for and will indemnify and will hold the Buyer,
its directors, officers, agents or employees, harmless against all
losses, liabilities, costs, expenses and damages, including court costs
and reasonable attorneys' fees, arising from
(a) claims for injuries to, or deaths of, the Seller's,
Manufacturer's or any Associated Contractor's respective
directors, officers, agents or employees, or loss or damage to
property of the Seller, Manufacturer or any Associated
Contractor or their respective employees when such losses occur
during or are incidental to (i) the Buyer's exercise of its
inspection rights under Clause 7, (ii) the Technical Acceptance
Process described in Clause 8, (iii) the provision of Field
Assistance pursuant to Clause 15 or (iv) the provision of
training pursuant to Clause 16; and
(b) claims for injuries to or deaths of third parties, or loss of
property of third parties, occurring during, or incidental to
(i) the Buyer's exercise of its inspection rights pursuant to
Clause 7 or (ii) the Technical Acceptance Process described in
Clause 8.
19.2 BUYER'S INDEMNITIES
Except in the case of gross negligence or willful misconduct on the part
of the Seller, the Buyer will be solely liable for and will indemnify
and will hold the Seller, the Manufacturer, each of the Associated
Contractors and their respective subcontractors, Affiliates of the
Seller, the Seller's representatives, and the respective assignees,
directors, officers, agents, and employees of each of the foregoing,
harmless against all losses, liabilities, costs, expenses and damages,
including court costs and reasonable attorneys' fees, arising from
(a) claims for injuries to or deaths of the Buyer's directors,
officers, agents or employees, or loss or damage to property of
the Buyer or its employees, when such losses occur during or are
incidental to (i) the Buyer's exercise of its inspection rights
under Clause 7; (ii) the Technical Acceptance Process described
in Clause 8, (iii) the provision of Field Assistance pursuant to
Clause 15, or (iv) the provision of training pursuant to Clause
16; and
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(b) claims for injuries to or deaths of third parties, or loss of
property of third parties, where such losses occur during or
incidental to (i) the provision of Field Services under Clause
15 or (ii) arise out of the provision of training pursuant to
Clause 16.
19.3 NOTICE AND DEFENSE OF CLAIMS
(a) If any claim is made or suit is brought against a party or
entity entitled to indemnification under this Clause 19 (the
"Indemnitee") for damages for which liability has been assumed
by the other party under this Clause 19, (the "Indemnitor"), the
Indemnitee will promptly give notice to the Indemnitor and the
Indemnitor (unless otherwise requested by the Indemnitee) will
assume and conduct the defense, or settlement, of such suit, as
the Indemnitor will deem prudent. Notice of the claim or suit
will be accompanied by all information pertinent to the matter
as is reasonably available to the Indemnitee and will be
followed by such cooperation by the Indemnitee as the Indemnitor
or its counsel may reasonably request at the expense of the
Indemnitor.
(b) In the event that the Indemnitor fails or refuses to assume the
defense of any claim or lawsuit notified to it under this Clause
19, the Indemnitee will have the right to proceed with the
defense or settlement of the claim or lawsuit as it deems
prudent and will have a claim over against the Indemnitor for
any judgments, settlements, costs or expenses, including
reasonable attorneys' fees. Further, in such event, the
Indemnitor will be deemed to have waived any objection or
defense to the Indemnitee's claim based on the reasonableness of
any settlement.
19.4 INSURANCE
(a) The Buyer will maintain adequate insurance to support its
undertakings under this Clause 19, and will bear any deductible
amounts set forth in the applicable policies. With respect to
Clause 19.2(a), the Buyer will provide a certificate of
insurance, if requested by the Seller, prepared by an insurance
broker licensed and skilled in the Field of aviation insurance,
in English and containing such specifics as the Seller may
reasonably demand.
(b) With respect to the Buyer's undertaking in Clause 19.2(b), the
Buyer will
(i) cause the Seller, its Affiliates, the Manufacturer, each
of the Associated Contractors and their respective
subcontractors, Seller's representatives, and the
respective
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assignees, officers, directors, agents and employees of
the foregoing, to be named as additional insureds under
the Buyer's liability policies;
(ii) obtain and cause the carriers of its hull all risks and
hull war risk policies to waive all rights of
subrogation against the Seller, its Affiliates, the
Manufacturer, each of the Associated Contractors,
Seller's representatives and the respective assignees,
officers, directors, agents and employees of the
foregoing; and
(iii) not less than seven (7) Working Days before the
commencement of training to be provided under Clause 16,
furnish to the Seller certificates of insurance, in
English, from a licensed insurance broker skilled in the
field of aviation insurance, certifying that
(1) the requirements of the foregoing Clauses 19.4
(b)(i) and (ii) have been met;
(2) the limits and insurance periods of each
applicable policy;
(3) the applicable policies are primary and
noncontributory to any other insurance
maintained by the Seller;
(4) the applicable policies contain a
cross-liability provision; and
(5) the insurance coverage will not become
ineffective, canceled, or materially decreased
or changed except on seven (7) Working Days'
notice to the Seller.
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20 - ASSIGNMENTS AND TRANSFERS
20.1 ASSIGNMENTS BY BUYER
Except as hereinafter provided, the Buyer may not sell, assign or transfer
its rights and obligations under this Agreement to any person without the
prior written Consent of the Seller.
20.2 ASSIGNMENTS ON SALE, MERGER OR CONSOLIDATION
The Buyer will be entitled to assign its rights under this Agreement at
any time due to a merger, consolidation or a sale of all or substantially
all of its assets, provided the Buyer first obtains the written consent
of the Seller. The Seller will provide its consent if
(1) the surviving or acquiring entity is organized and existing under
the laws of the United States;
(ii) the surviving or acquiring entity has executed an assumption
agreement, in form and substance reasonably, acceptable to the
Seller, agreeing to assume all of the Buyers obligations under this
Agreement;
(iii) at the time, and immediately following the consummation, of the
merger, consolidation or sale, no event of default exists or will
have occurred and be continuing; and
(iv) there exists with respect to the surviving or acquiring entity no
basis for a Termination Event within the meaning of Clause 21 of
this Agreement.
20.3 ASSIGNMENTS BY SELLER
The Seller may at any time sell, assign or transfer its rights and
obligations under this Agreement to any person, provided such sale,
assignment or transfer be notified to the Buyer and will not have a
material adverse effect on any of the Buyer's rights and obligations under
this Agreement.
20.4 TRANSFER OF RIGHTS AND OBLIGATIONS UPON REORGANIZATION
If at any time until the date upon which ail the obligations and
liabilities of the Seller under this Agreement have been discharged, the
legal structure, the membership or the business of the Seller is
reorganized or the legal form of the Seller is changed and as a
consequence thereof the Seller wishes the Buyer to accept the substitution
of the Seller by another entity within the restructured Airbus group (or
the Seller in its new legal form) ("NEWCO") as contemplated below, the
Seller will promptly notify the Buyer of its wish.
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In such event, the Seller may request the Buyer to enter into a novation
agreement and/or other agreement having the same effect whereby the
Seller's rights and obligations under this Agreement are novated or
transferred in favor of Newco. Upon receipt of such request, the Buyer
will enter into a novation agreement and/or other appropriate agreement,
provided that the Buyer's rights and obligations under this Agreement are
not materially adversely affected by such novation and/or other agreement.
Until any such novation agreement/other appropriate documentation has come
into effect, this Agreement will remain in full force and effect, and each
party will act diligently and in good faith to implement the novation
agreement and/or other appropriate documentation as soon as practicable
after Newco has come into existence.
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21 - TERMINATION FOR CERTAIN EVENTS
21.1 TERMINATION EVENTS
21.1.1 Each of the following will constitute a "Termination Event" under this
Agreement and immediately upon the occurrence of a Termination Event.
the Buyer will notify the Seller of such occurrence in writing and by
courier or telefax, provided, however, that any failure by the Buyer to
notify the Seller will not prejudice the Seller's rights hereunder:
(1) The Buyer or any of its Affiliates or any other party commences
any case, proceeding or other action with respect to the Buyer
or any of its Affiliates in any jurisdiction relating to
bankruptcy, insolvency, reorganization relief from debtors, an
arrangement, winding-up, liquidation, dissolution or other
relief with respect to its debts and such case, proceeding or
other action remains unstayed, undismissed or undischarged for
sixty (60) days.
(2) An action is commenced seeking the appointment of a receiver
trustee, custodian or other similar official for the Buyer or
any of its Affiliates for all or substantially all of its
assets, and such action remains unstayed, undismissed or
undischargable for sixty (60) days, or the Buyer or any of its
Affiliates makes a general assignment for the benefit of its
creditors.
(3) An action is commenced against the Buyer or any of its
Affiliates seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any
substantial part of its assets, and such action remains
unstayed, undismissed or undischarged for sixty (60) days.
(4) The Buyer or any of its Affiliates becomes insolvent or fails
generally to pay its debts as they become due.
(5) [INTENTIONALLY LEFT BLANK]
(6) Any event occurs with respect to the Buyer in any jurisdiction
to which it is subject which has an effect equivalent to any of
the events mentioned in 21.1.1(l), (2), (3) or (4).
(7) The Buyer or any of its Affiliates fails to make (i) any payment
required to be made pursuant to this Agreement or any other
agreement between the Buyer or any of its Affiliates and the
Seller or any of its Affiliates when such payment comes due,
(ii) any Predelivery Payment required to be made pursuant to
this Agreement, (iii) payment of all or part of the Final
Contract Price
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required to be made pursuant to Clause 5 of this Agreement, or (iv)
any payments as they become due to or for the benefit of the
Propulsion Systems manufacturer or an A320 family aircraft operating
lessor, under their respective agreements with the Buyer, provided
that the cure period applicable to such payment, if any, has
expired.
(8) An "Event of Default" (as defined in the relevant agreement) or
analogous event occurs under the terms of any [****] provided that
any applicable cure period has expired.
(9) The Buyer defaults in (i) the payment of principal or interest under
one or more agreements for borrowed money and/or (ii) the payment of
rent or indemnities under one or more lease agreements that, in the
aggregate, have a principal amount of [****] or more (determined in
the case of borrowed money by the amount outstanding, and, in the
case of a lease, by the present value of the remaining rent
payable thereunder discounted at 6% (six percent) per year) when
the same becomes due, if such nonpayment either allows or results
in an acceleration of such indebtedness, provided that any
applicable cure period has expired.
(10) Any commitment to extend credit, in any manner and in any form, to
the Buyer is terminated by the other party to such committment,
provided such party is the Seller, the Propulsion Systems
manufacturer or a proposed lessor of any aircraft manufactured by
the Manufacturer or any Affiliate of any such party, and [****].
(11) The Buyer fails to meet any one at the following conditions:
(a) The Buyer fails to be an air carrier certificated under
Section 604(b) of the Federal Aviation Act by March 1, 2000,
and the Buyer does not pay the Seller an additional
Predelivery Payment of two percent (2%) of the Predelivery
Payment
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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Reference Price for each of the Firm Aircraft to be delivered
in 2000, or
(b) the Buyer fails to be an air carrier certificated under
Section 604(b) of the Federal Aviation Act by April 1, 2000,
and the Buyer does not pay the Seller an additional
Predelivery Payment of two percent (2%) of the Predelivery
Payment Reference Price for each of the Firm Aircraft to be
delivered in 2000, or
(c) the Buyer fails to be an air carrier certificated under
Section 604(b) of the Federal Aviation Act by May 1, 2000, and
the Buyer does not pay the Seller an additional Predelivery
Payment of two percent (2%) of the Predelivery Payment
Reference Price for each of the Firm Aircraft to be delivered
in 2000, or
(d) the Buyer fails to be an air carrier certificated under
Section 604(b) of the Federal Aviation Act by May 31, 2000.
(12) With respect to any other credit or lease financing facility or
similar agreement, either (i) the commitment to lend, finance or
lease, as the case may be, thereunder is terminated (other than by
the Buyer) or (ii) a financial covenant thereunder is breached and
such breach is not waived or cured within thirty (30) days after the
occurence thereof, and such termination, in the Seller's reasonable
opinion, has or could have a material adverse effect on the ability
of the Buyer to perform its obligations hereunder.
(13) The Buyer repudiates or is deemed to have repudiated this Agreement.
(14) The Buyer defaults in its obligation to take delivery of an Aircraft
as provided in Clause 9.2 of this Agreement.
(15) The Buyer breaches this Agreement or defaults in the observance or
performance of any other covenant, undertaking or obligation
contained in this Agreement or any other agreement between the Buyer
and the Seller and, if such breach or default is capable of being
cured, such breach or default is not cured within any specified cure
period, or if no cure period is specified, within five (5) days of
such breach or default.
(16) The Buyer is involuntarily removed from active membership and
participation in any airline clearinghouse (or any substitute or
replacement arrangement) or the Buyer is placed on a cash basis by
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such clearinghouse (or any such substitute or replacement
arrangement).
(17) At the end of each calendar month, the Buyer fails to have
unencumbered cash balances of not less than the product of
(i) [****] multiplied by (ii) the number of jet-powered
aircraft then owned, acquired pursuant to a conditional sale
agreement or leased by the Buyer (in each case whether or not
then operated by the Buyer). However, the Buyer will maintain
a minimum unencumbered cash balance of [****] as of January
1, 2000.
(18) The Buyer fails to [****].
21.1.2 In the event of any Termination Event, the Seller will [****] the
Seller will at its sole option have the right to resort to any remedy
under applicable law, including, without limitation, the right by
written notice to the Buyer, effective immediately, to (i) suspend
its performance under the Agreement and under any other agreements
between the Buyer and the Seller; (ii) terminate this Agreement or
any other agreement between the Buyer and the Seller with respect to
any or all Aircraft or aircraft, equipment, services, data and other
items undelivered or unfurnished on the effective date of such
termination; (iii) reschedule Delivery of any and all Aircraft
remaining to be delivered under this Agreement as of the date of the
occurrence of the Termination Event; (iv) reschedule delivery of any
and all aircraft remaining to be delivered under any other agreement
between the Buyer and the Seller as of the date of the occurrence of
the Termination Event and (v) retain, as part of the liquidated
damages for breach and not as a penalty, an amount equal to (a) all
Predelivery Payments previously received by the Seller from the Buyer
under this Agreement; (b) all other payments to the Seller made
theretofore under this Agreement or any other agreement between the
Buyer and the Seller and (c) any other amounts agreed to between the
Buyer and the Seller pursuant to this Agreement.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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The Seller will have the right to elect one or more of the foregoing
remedies, and exercise of any one or more of such remedies will not be
deemed a waiver of any other remedy or remedies provided herein or under
applicable law.
21.2 Information Covenants
The Buyer hereby covenants and agrees that, from the date of this
Agreement until no further Aircraft are to be delivered hereunder, the
Buyer will furnish or cause to be furnished to the Seller the following:
(a) Annual Financial Statements. As soon as available and in any event
within 120 days after the close of each fiscal year of the Buyer,
(i) a copy of the SEC Form 10-K filed by the Buyer with the
Securities and Exchange Commission or any successor thereto (the
"SEC") for such fiscal year, or, if no such Form 10-K was flied by
the Buyer for such a fiscal year, the consolidated balance sheet of
The Buyer and its Subsidiaries, as at the end of such fiscal year
and the related consolidated statements of operations, of common
stockholders' equity (deficit) (in the case of the Buyer and its
Subsidiaries) and of cash flows for such fiscal year, setting forth
comparative consolidated figures as of the end of and for the
preceding fiscal year, and examined by (x) any "Big Five" accounting
firm or (y) any other firm of independent public accountants of
recognized standing selected by the Buyer, whose opinion will not be
qualified as to the scope of audit or as to the status of the Buyer
as a going concern, and (ii) a certificate of such accounting firm
stating that its audit of the business of the Buyer was conducted in
accordance with generally accepted auditing standards.
(b) Quarterly Financial Statements. As soon as available and in any
event within 45 days after the close of each of the first three
quarterly accounting periods in each fiscal year of the Buyer, a
copy of the SEC Form l0-Q filed by the Buyer with the SEC for such
quarterly period, or, if no such Form l0-Q was filed by the Buyer
with respect to any such quarterly period, the consolidated balance
sheet of the Buyer and its Subsidiaries as at the end of such
quarterly period and the related consolidated statements of
operations for such quarterly period and for the elapsed portion of
the fiscal year ended with the last day of such quarterly period and
in each case setting forth comparative consolidated figures as of
the end of and for the related periods in the prior fiscal year, all
of which will be certified by an Authorized Officer of the Buyer,
subject to changes resulting from audit and normal year-end audit
adjustments.
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(c) Other Information. Promptly upon transmission thereof, copies of any
filings and registrations with, and reports to, the SEC by the Buyer
or any of its Subsidiaries, and, with reasonable promptness, such
other information or documents (financial or otherwise) as the
Seller may reasonably request from time to time.
For the purposes of this Sublease 21.2, (x) an "Authorized Officer" of
the Buyer will mean the Chief Executive Officer, the Chief Financial
Officer or any Vice President and above who reports directly or indirectly
to the Chief Financial Officer and (y) "Subsidiaries" will mean, as of any
date of determination, those companies owned by the Buyer whose financial
results the Buyer is required to include in its statements of consolidated
operations and consolidated balance sheets.
21.3 Nothing contained in this Clause 21 will be deemed to waive or limit the
rights and remedies available to the Seller under the Uniform Commercial
Code (the "UCC"), including, but not limited to, those rights and remedies
described in Article 2, Section 609 of the UCC. It is understood that
for the purposes of providing reassurance under Article 2, Section 609 of
the UCC, the Buyer cannot rely on any commitment of the Seller or the
Propulsion Systems manufacturer to provide financing.
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22 - MISCELLANEOUS PROVISIONS
22.1 DATA RETRIEVAL
On the Seller's reasonable request, the Buyer will provide the Seller with
all the necessary data, as customarily compiled by the Buyer and
pertaining to the operation of the Aircraft, to assist the Seller in
making an efficient and coordinated survey of all reliability,
maintenance, operational and cost data with a view to improving the
safety, availability and operational costs of the Aircraft.
22.2 NOTICES
All notices and requests required or authorized hereunder will be given in
writing either by personal delivery to a responsible officer of the party
to whom the same is given or by commercial courier, certified air mail
(return receipt requested) or facsimile at the addresses and numbers set
forth below. The date on which any such notice or request is so personally
delivered, or if such notice or request is given by commercial courier.
certified air mail or facsimile, the date on which sent, will be deemed to
be the effective date of such notice or request.
The Seller will be addressed at:
2, rond-point Maurice Bellonte
31700 BLAGNAC FRANCE
Attention: Director -- Contracts
Telephone: 33 05 61 30 40 12
Telecopy: 33 05 61 30 40 11
The Buyer will be addressed at:
6322 South 3000 East
Suite L-201
Salt Lake City, Utah 84121
Attention: Executive Vice President & General Counsel
Telephone: 801-947-7888
Fax: 801-944-4840
From time to time, the party receiving the notice or request may designate
another address or another person.
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22.3 WAIVER
The failure of either party to enforce at any time any of the provisions
of this Agreement, to exercise any right herein provided or to require at
any time performance by the other party of any of the provisions hereof
will in no way be construed to be a present or future waiver of such
provisions nor in any way to affect the validity of this Agreement or any
part hereof or the right of the other party thereafter to enforce each and
every such provision. The express waiver by either party of any provision,
condition or requirement of this Agreement will not constitute a waiver of
any future obligation to comply with such provision, condition or
requirement.
22.4 INTERPRETATION AND LAW
THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED AND THE PERFORMANCE
THEREOF WILL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT GIVING EFFECT TO ITS CONFLICTS OF LAWS PROVISIONS.
Each of the Seller and the Buyer (i) hereby irrevocably submits itself to
the nonexclusive jurisdiction of the courts of the state of New York, New
York County, of the United States District Court for the Southern District
of New York, for the purposes of any suit, action or other proceeding
arising out of this Agreement, the subject matter hereof or any of the
transactions contemplated hereby brought by any party or parties hereto,
and (ii) hereby waives, and agrees not to assert, by way of motion, as a
defense or otherwise, in any such suit, action or proceeding, to the
extent permitted by applicable law, any defense based on sovereign or
other immunity or that the suit, action or proceeding which is referred
to in clause (i) above is brought in an inconvenient forum, that the venue
of such suit, action or proceeding is improper, or that this Agreement or
the subject matter hereof or any of the transactions contemplated hereby
may not be enforced in or by these courts. The Seller hereby designates
and appoints CT Corporation, New York City offices, to receive for and on
its behalf service of process in any proceeding with respect to any matter
as to which it submits to jurisdition as set forth above, it being agreed
that service on CT Corporation will constitute valid service on the
Seller. The Buyer hereby generally consents to service of process by
registered mail, return receipt requested, at its address for notice under
this Agreement.
THE PARTIES HEREBY ALSO AGREE THAT THE UNITED NATIONS CONVENTION ON
CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS WILL NOT APPLY TO THIS
TRANSACTION.
101
<Page>
22.5 CONFIDENTIALITY
Subject to any legal or governmental requirements of disclosure, the
parties (which for this purpose will include their employees, agents and
advisors) will maintain the terms and conditions of this Agreement and any
reports or other data furnished hereunder strictly confidential. Without
limiting the generality of the foregoing, the Buyer will use its best
efforts to limit the disclosure of the contents of this Agreement to the
extent legally permissible in any filing required to be made by the Buyer
with any governmental agency and will make such applications as will be
necessary to implement the foregoing. With respect to any public
disclosure or filing, the Buyer agrees to submit to the Seller a copy of
the proposed document to be filed or disclosed and will give the Seller a
reasonable period of time in which to review the said document. The Buyer
and the Seller will consult with each other before the making of any
public disclosure or filing, permitted hereunder, of this Agreement or the
terms and conditions thereof. The provisions of this Clause 22.5 will
survive any termination of this Agreement.
22.6 SEVERABILITY
In the event that any provision of this Agreement should for any reason be
held to be without effect, the remainder of this Agreement will remain in
full force and effect. To the extent permitted by applicable law, each
party hereto hereby waives any provision of law which renders any
provision of this Agreement prohibited or unenforceable in any respect.
22.7 ALTERATIONS TO CONTRACT
This Agreement, including its Exhibits and Appendixes, contains the entire
agreement between the parties with respect to the subject matter hereof
and thereof and supersedes any previous understanding, commitments or
representations whatsoever, whether oral or written (including, without
limitation, that certain Term Sheet dated March 4, 1999, bearing AVSA
reference No. 5229.3, between the Seller and the Buyer and all exhibits
thereto). This Agreement will not be varied except by an instrument in
writing of even date herewith or subsequent hereto executed by both
parties or by their fully authorized representatives.
22.8 INCONSISTENCIES
In the event of any inconsistency between the terms of this Agreement and
the terms contained in either (i) the Specification annexed in Exhibit A
hereto, or (ii) any other Exhibit hereto, in each such case the terms of
this Agreement will prevail over the terms of the Specification or any
other
102
<Page>
Exhibit hereto. For the purpose of this Clause 22.8, the term Agreement
will not include the Specification or any other Exhibit hereto.
22.9 LANGUAGE
All correspondence, documents and any other written matters in
connection with this Agreement will be in English.
22.10 HEADINGS
All headings in this Agreement are for convenience of reference only and
do not constitute a part of this Agreement.
22.11 COUNTERPARTS
This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered will be an
original, but all such counterparts will together constitute but one and
the same instrument.
22.12 OPINION OF COUNSEL
The Buyer will, concurrently with the execution of this Agreement, deliver
to the Seller an opinion of counsel for the Buyer reasonably satisfactory
to the Seller and dated as of such date to the effect that (i) the
execution, delivery and performance of this Agreement are within the
corporate power of the Buyer, (ii) the execution, delivery and performance
of this Agreement, in accordance with the respective terms by the Buyer,
do not, to such counsel's knowledge, constitute a breach of any agreement
to which the Buyer is a party, and (iii) this Agreement has been duly
executed and delivered by and constitutes legal, valid and binding
obligations of the Buyer enforceable in accordance with its terms, and
such opinion will also address such other matters as the Seller may
reasonably request.
103
<Page>
IN WITNESS WHEREOF, these presents were entered into as of the day and year
first above written.
AVSA, S.A.R.L..
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title:
NEW AIR CORPORATION
By: /s/ David Neeleman
-----------------------------------------
Title: CEO
104
<Page>
EXHIBIT A
The A320-200 Standard Specification is contained in a separate folder.
Exh. A-1
<Page>
EXHIBIT B
================================================================================
AVSA SCN No.
SPECIFICATION CHANGE NOTICE Issue
(SCN) Dated
Page No.
--------------------------------------------------------------------------------
TITLE
DESCIRIPTION
EFFECT ON WEIGHT
Manufacturer's Weight Empty Change:
Operational Weight Empty Change:
Allowable Payload Change:
REMARKS/REFERENCES
Response to RFC
SPECIFICATION CHANGED BY THIS SCN
THIS SCN REQUIRES PRIOR OR CONCURRENT ACCEPTANCE OF THE FOLLOWING SCN(s)
--------------------------------------------------------------------------------
PRICE PER AIRCRAFT
US DOLLARS:
AT DELIVERY CONDITIONS:
This change will be effective on____Aircraft No.______and subsequent
provided approval is received by_________________________.
BUYER APPROVAL SELLER APPROVAL
By: By:
Title: (Authorized Finance Department Officer) Date:
By:
Title: (Authorized maintenance or flight operations officer)
Date:
================================================================================
Exh. B-1
<Page>
EXHIBIT C
SELLER SERVICE LIFE POLICY
1. The Items of primary and auxiliary structure described hereunder are
covered by the Service Life Policy described in Subclause 12.2 of the
Agreement.
2. WINGS - CENTER AND OUTER WING BOX
2.1 SPARS
2.2 RIBS INSIDE THE WING BOX
2.3 UPPER AND LOWER PANELS OF THE WING BOX
2.4 FITTINGS
2.4.1 Attachment fittings for the flap structure
2.4.2 Attachment fittings for the engine pylons
2.4.3 Attachment fittings for the main landing gear
2.4.4 Attachment fittings for the center wing box
2.5 AUXILIARY SUPPORT STRUCTURE
25.1 FOR THE SLATS:
2.5.1.1 Ribs supporting the track rollers on wing box structure
2.5.1.2 Ribs supporting the actuators on wing box structure
2.5.2 FOR THE AILERONS:
2.5.2.1 Hinge brackets and ribs on wing box rear spar or shroud box
2.5.2.2 Actuator fittings on wing box rear spar or shroud box
2.5.3 FOR AIRBRAKES, SPOILERS, LIFT DUMPERS:
2.5.3.1 Hinge brackets and ribs on wing box rear spar or shroud box
Exh. C-1
<Page>
EXHIBIT C
2.5.3.2 Actuator fittings on wing box rear spar or shroud box
3. FUSELAGE
3.1 FUSELAGE STRUCTURE
3.1.1 Fore and aft bulkheads
3.1.2 Pressurized floors and bulkheads surrounding the main and nose gear
wheel well and center wing box
3.1.3 Skins with doublers, stringers and frames from the forward pressure
bulkheads to the frame supporting the rear attachment of horizontal
stabilizer
3.1.4 Window and windscreen attachment structure but excluding transparencies
3.1.5 Passenger and cargo doors internal structure
3.1.6 Sills excluding scuff plates and upper beams surrounding passenger and
cargo door apertures
3.1.7 Cockpit floor structure and passenger cabin floor beams excluding floor
panels and seat rails
3.1.8 Keel beam structure
3.2 FITTINGS
3.24 Landing gear attachment fittings
3.2.2 Support structure and attachment fittings for the vertical and
horizontal stabilizers
4. STABILIZERS
4.1 HORIZONTAL STABILIZER MAIN STRUCTURAL BOX
4.1.1 Spars
4.1.2 Ribs
4.1.3 Upper and lower skins and stringers
Exh. C-2
<Page>
EXHIBIT C
4.1.4 Attachment fittings to fuselage and trim screw actuator
4.1.5 Elevator support structure
4.1.5.1 Hinge bracket
4.1.5.2 Servocontrol attachment brackets
4.2 VERTICAL STABILIZER MAIN STRUCTURAL BOX
4.2.1 Spars
4.2.2 Ribs
4.2.3 Skins and stringers
4.2.4 Attachment fittings to fuselage
4.2.5 Rudder support structure
4.2.5.1 Hinge brackets
4.2.5.2 Servocontrol attachment brackets
5. Bearing and roller assemblies, bearing surfaces, bushings, bolts,
rivets, access and inspection doors, including manhole doors, latching
mechanisms, all system components, commercial interior parts,
insulation and related installation and connecting devices are excluded
from this Seller Service Life Policy.
Exh. C-3
<Page>
APPENDIX I TO EXHIBIT A
The SCNs include the items in the following table:
<Table>
<Caption>
--------------------------------------------------------------------------
<S> <C>
PWX [****]
--------------------------------------------------------------------------
Second observer seat [****]
--------------------------------------------------------------------------
Alternate OHSC doors [****]
--------------------------------------------------------------------------
TOTAL [****]
--------------------------------------------------------------------------
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
Exh. A, App. 1-1
<Page>
EXHIBIT D
CERTIFICATE OF ACCEPTANCE
In accordance with the terms of that certain A320 Purchase Agreement dated as of
____________, between New Air Corporation ("NA") and AVSA, S.A.R.L. ("AVSA")
(the Purchase Agreement"), the acceptance tests relating to the Airbus A320
aircraft, Manufacturer's Serial Number: _____, U.S. Registration Number:
_______with two (2) International Aero Engines V2527-A5 series propulsion
systems installed thereon, serial nos. _______ (position #1) and ________
(position #2) (the "Aircraft"), have taken place at ______ on the ____ day of
______________, __________________.
In view of said tests having been carried out with satisfactory results, NA
hereby approves the Aircraft as being in conformity with the provisions of the
Purchase Agreement.
Said acceptance does not impair the rights of NA that may be derived from the
warranties relating to the Aircraft set forth in the Purchase Agreement.
NA specifically recognizes that it has waived any right it may have at law or
otherwise to revoke this acceptance of the Aircraft.
RECEIPT AND ACCEPTANCE OF THE ABOVE -
DESCRIBED AIRCRAFT ACKNOWLEDGED
NEW AIR CORPORATION
By:
-----------------------------------------
Its:
----------------------------------------
Exh. D-1
<Page>
EXHIBIT E
BILL OF SALE
Know all persons by these presents that AVSA, S.A.R.L. ("AVSA"), a SOCIETE A
RESPONSABILITE LIMITEE organized and existing under the laws of the Republic of
France, whose address is 2 rond-point Maurice Bellonte, 31700 Blagnac, FRANCE,
is the owner of the title to the following airframe (the "AIRFRAME"), the
attached engines as specified (the "ENGINES") and all appliances, components,
parts, instruments, accessories, furnishings, modules and other equipment of any
nature, excluding buyer furnished equipment, incorporated therein, installed
thereon or attached thereto on the date hereof (the "PARTS"):
MANUFACTURER OF AIRFRAME: MANUFACTURER OF ENGINES:
AIRBUS INDUSTRIE G.I.E. INTERNATIONAL AERO ENGINES
MODEL: A320-200 MODEL: V2527-A5
MANUFACTURER'S SERIAL NUMBERS
LH: [ ]
SERIAL NUMBER: [ ] RH: [ ]
REGISTRATION NO: [ ]
The Airframe, Engines and Parts are hereafter together referred to as the
aircraft (the "AIRCRAFT").
AVSA does this ___ day of ________________ sell, transfer and deliver all of its
above described rights, title and interest to the Aircraft to the following
company forever, said Aircraft to be the property thereof:
NEW AIR CORPORATION (the "Buyer")
AVSA hereby warrants to the Buyer that it has on the date hereof good and lawful
right to sell, deliver and transfer title to the Aircraft to the Buyer and that
there is hereby conveyed to the Buyer on the date hereof good, legal and valid
title to the Aircraft, free and clear of all legal liens, claims, charges,
encumbrances and rights of others.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed by
its duly authorized representative this _______ day of [ ].
AVSA, S.A.R.L.
By:
Title:
Signature:
Exh. E-1
<Page>
EXHIBIT F
TECHNICAL PUBLICATIONS
GENERAL
This Exhibit F lists the form, type, quantity and delivery dates for the
Technical Publications to be provided to the Buyer pursuant to Clause 14 of the
Agreement.
The Technical Publications are published in accordance with ATA Specification
100 revision 23, with the exception or certain Component Maintenance Manuals,
which may be written to an ATA Specification 100 revision other than revision
23.
The designation "C" after the title of a Technical Publication indicates that
such Technical Publication may be customized.
Exh. F-1
<Page>
1. ENGINEERING DOCUMENTS
1.1 INSTALLATION AND ASSEMBLY DRAWINGS (IAD)--C
The IAD will be delivered according to the Buyers standard for the major
Assembly and Installation drawings, including detail drawings.
1.2 DRAWING NUMBER INDEX (DNI)--C
The DNI lists applicable drawings of the Aircraft delivered under the
Agreement.
1.3 PROCESS AND MATERIAL SPECIFICATION (PMS)
The PMS contains data related to manufacturing processes, material
identification and treatments used in the construction and assembly of the
Aircraft.
1.4 STANDARDS MANUAL (SM)
The SM contains data about Seller approved standards and includes cross
reference lists. The SM will include US standards/equivalents for all
hardware clamps, 0-rings, bearings, fasteners, sealants, adhesive and
compounds, raw materials, processes and procedures.
2. MAINTENANCE AND ASSOCIATED MANUALS
2.1 APV BUILD-UP MANUAL (ABM)
The ABM follows the format adopted for the Power Plant Build-up Manual.
2.2 AIRCRAFT MAINTENANCE MANUAL (AMM)--C
The component location section of the AMM will show those components
detailed in the AMM maintenance procedures. The trouble shooting part is
covered in Subparagraph 2.21 below.
*Aircraft Maintenance Manual Chapter 05 Time Limits (Service Life
Limits) and Maintenance Checks are only delivered in hard copies.
Exh. F-2
<Page>
2.3 AIRCRAFT SCHEMATICS MANUAL (ASM)--C
The ASM is part of the Wiring Manual. Supplied as a separate manual for
schematics.
2.4 AIRCRAFT WIRING MANUAL (AWM)--C
The AWM is part of the Wiring Manual. Supplied as a separate manual for
wirings.
2.5 AIRCRAFT WIRING LISTS (AWL)--C
The AWL is part of the Wiring Manual. Supplied as a separate document for
lists. The AWL includes wire terminations, connector, terminal, strip
locations, wire routings, and clamping diagrams.
2.6 CONSUMABLE MATERIAL LIST (CML)
The CML details the characteristics and gives procurement sources
of consumable materials such as grease, oil, etc.
2.7 DUCT REPAIR MANUAL (DRM)
The DRM contains all the data necessary to locate, identify, repair and/or
replace subassemblies of metallic ducts. It also includes details of tests
necessary after repair.
2.8 FUEL PIPE REPAIR MANUAL (FPRM)
The FPRM provides workshop repair procedures and data for specific fuel
pipes, after removal from any aircraft of the Manufacturer of the type of
the Aircraft.
2.9 ILLUSTRATED PARTS CATALOG (IPC}--C
The IPC identifies and illustrates all line replaceable parts and units of
the aircraft, excluding the power plant parts.
2.l0 ILLUSTRATED PARTS CATALOG (power plant) (PPIPC)--C
The PPIPC covers line replaceable parts and units of the power plant
provided by the Propulsion Systems manufacturer.
Exh. F-3
<Page>
2.11 ILLUSTRATED TOOL AND EQUIPMENT MANUAL (TEM)
The TEM provides information on Ground Equipment and Tools listed in the
Seller's Aircraft Maintenance Manual.
2.12 MAINTENANCE FACILITY PIANNING (MEP)
The MFP provides information that will assist airline personnel concerned
with long term planning of ramp or terminal operations. Aircraft
maintenance on the ramp and in the hangar, overhaul and testing of
structure and system components.
2.13 MAINTENANCE PLANNING DOCUMENT (MPD)
The MPD provides maintenance data necessary to plan and conduct Aircraft
maintenance checks and inspections.
2.14 POWER PLANT BUILD-UP MANUAL (PPBM)
The PPBM provides instructions for the installation of a quick engine
change kit on a bare engine.
2.15 SUPPORT EQUIPMENT SUMMARY (SES)
The SES lists support equipment recommended by the Seller, the Propulsion
Systems manufacturer and Vendors.
2.16 TIME LIMITS AND MAINTENANCE CHECKS/SERVICE LIMITS AND MAINTENANCE CHECKS
(TLMC\SLMC)
The TLMC\SLMC document provides the Manufacturer's recommended scheduled
time limits for inspections and maintenance checks.
2.17 TOOL\EQUIPMENT DRAWINGS (TED)
TEDs will be supplied in the form of aperture cards for the Seller and,
when available, Vendor maintenance tools.
Exh. F-4
<Page>
2.18 TOOL AND EQUIPMENT DRAWING INDEX (TEI)
The TEI is an alpha-numeric listing of the TED's.
2.19 TOOL AND EQUIPMENT BULLETIN (TEB)
The TEB provides advance information related to tools and test equipment
development.
2.20 TROUBLE SHOOTING MANUAL (TSM)--C
The TSM complements the CFDS and provides trouble-shooting data in the
following three levels:
LEVEL 1 - Aimed at line use. Fault isolation guidance for systems or parts
of systems monitored mainly by CFDS. Also guidance for systems
not monitored by CFDS.
LEVEL 2 - Aimed at hangar use. Fault isolation guidance for non-CFDS
monitored systems in the form of functional block diagrams,
charts and tables.
LEVEL 3- Aimed at engineering use. List of CFDS messages and decoding of
trouble shooting data (decoding of coded messages provided by the
CFDS). Level 3 is supplied on floppy disk.
3. MISCELLANEOUS DOCUMENTATION
3.1 AIRPLANE CHARACTERISTICS FOR AIRPORT PLANNING (AC)
The AC will be in general accordance with Specification NAS 3601.
3.2 AIRCRAFT RECOVERY MANUAL (ARM)
The ARM provides the following planning information: preparing and moving
a disabled aircraft that may be obstructing airport traffic.
3.3 CARGO LOADING SYSTEM MANUAL (CLS)
The CLS details handling procedures for the Cargo Loading System.
3.4 CRASH CREW CHART (CCC)
The CCC provides information concerning access to the Aircraft interior,
location of safety equipment, hazardous liquids, etc.
Exh. F-5
<Page>
3.5 GUIDELINES FOR CUSTOMER ORIGINATED CHANGES (GCOC)
The GCOC provides production and presentation rules for the data covering
Buyer originated changes on the Aircraft to be incorporated by the Seller
in the Technical Publications as per Subclause 14.11 of the Agreement.
3.6 LIST OF RADIOACTIVE AND HAZARDOUS ELEMENTS (LRE)
The LRE provides information on components and materials for which
specific precautions have to be taken.
3.7 LIST OF APPLICABLE PUBLICATIONS (LAP)--C
The LAP will record the Seller's various Airframe Technical Publications
indicating the last valid revision number and issue date.
3.8 LIVESTOCK TRANSPORTATION MANUAL (LTM)
The LTM details the facilities, equipment and procedures necessary for
live animal transportation in aircraft of the Manufacturer of the type of
the Aircraft.
3.9 SERVICE BULLETINS (SB)--C
The Buyer will receive all Service Bulletins applicable to the Aircraft.
3.10 SERVICE BULLETIN INDEX (SBI)
The SBI is a listing of all Service Bulletins issued in ATA 100 chapter
sequence.
The SBI provides details of SB number, SB title, associated modification
number, issue status, Vendor SB number (if applicable) and affected
fleet.
3.11 SERVICE INFORMATION LETTERS (SIL)
SILs give information of a general nature and also about minor changes or
inspections the Buyer may wish to apply under the Buyer's authority.
3.12 TRANSPORTABILITY MANUAL (TM)
The TM gives cargo hold dimensions for currently available cargo Aircraft,
transportation information and requirements for large Aircraft components.
Component dimensions, weights and shelf life limitations are also given.
Exh. F-6
<Page>
3.13 SUPPLIER PRODUCT SUPPORT AGREEMENTS (SPSA)
The SPSA is a collection of product support conditions negotiated by the
Manufacturer with the suppliers of Aircraft equipment.
3.14 VENDOR INFORMATION MANUAL (VIM)
The VIM provides Vendor contact information.
3.15 VENDOR INFORMATION MANUAL (GSE) (VIM/GSE)
The VIM/GSE gives contact names and addresses of Ground Support Equipment
(GSE) vendors and their product support organizations.
4. OPERATIONAL MANUALS
4.1 ABNORMAL\EMERGENCY CHECK LIST\QUICK REFERENCE HANDBOOK (CL\ORH--C
The CL is an extract from the FCOM presented as a booklet for quick
in-flight use.
4.2 FAA APPROVED FLIGHT MANUAL (FM)--C
The AFM provides Aircraft performance operating limitations and other
flight data required by the relevant airworthiness authorities for
certification. It includes the Configuration Deviation List (CDL).
4.3 FLIGHT CREW OPERATING MANUAL (FCOM)--C
The FCOM provides Aircraft and systems descriptions, normal, abnormal and
emergency procedures as well as operational performance.
4.4 MASTER MINIMUM EQUIPMENT LIST (MMEL)
The MMEL defines the components and the related conditions under which,
when the components are defective, the Aircraft may be cleared for flight.
In addition, the MMEL. provides the necessary inFormation to establish the
Buyer's own Minimum Equipment List (MEL).
4.5 PERFORMANCE ENGINEERING PROGRAM (PEP)
The PEP consists of a Low Speed Performance data base and a High Speed
Performance data base together with their respective programs. The
Performance Engineering
Exh. F-7
<Page>
Program may be used by the Buyer under the license conditions set forth in
Appendix A to this Exhibit F.
The Low Speed Performance programs consist of the Take-off and Landing
Chart computation program (TLC) which permits the computation of:
- regulatory take-off and landing performance,
- noncertified take-off performance accounting for runway data and
weather, together with the Tabulation and Interpolation program (TAB),
issued with the AFM, which permits the reading, editing and interpolation
of the tables listed in the AFM.
The High Speed Performance programs arc the In Flight Performance
computation program (IFP) which permits computaion of Aircraft
performance for each flight phase and the Aircraft Performance
Monitoring program (APM) which permits analysis of Aircraft cruise
performance from data recorded during stabilized flight periods.
4.6 PERFORMANCE PROGRAM MANUAL (PPM)
The PPM is the users' guide for the Performance Engineering Program (PEP).
4.7 Weight and Balance Manual (WBM) and
WEIGHT AND BALANCE MANUAL SUPPLEMENTS--C
The corresponding supplements:
-Delivery Weighing Report,
-Equipment List,
will be delivered with each Aircraft.
5. OVERHAUL DATA
5.1 CABLE FABRICATION MANUAL (CFM)
The CFM contains all the data necessary to locate, identify, manufacture
and test control cables used on the Aircraft. An appendix contains cable
end fitting specification sheets, and detailed manufacturing instructions.
5.2 COMPONENT DOCUMENTATION STATUS (CDS)--C
The CDS lists Component Maintenance Manuals in accordance with
Subparagraphs 5.4 and 5.5 below.
Exh. F-8
<Page>
5.3 COMPONENT EVOLUTION LIST (CEL)
The CEL is a noncustomized document listing all components on the Aircraft
and also gives the evolution of each component.
The information is provided in order of:
- part number
- FSCM
- ATA reference.
5.4 COMPONENT MAINTENANCE MANUAL MANUFACTURER (CMMM)
The CMMM contains all the data necessary to locate, identify and maintain
Aircraft components manufactured by the Seller.
5.5 COMPONENT MAINTENANCE MANUAL VENDOR (CMMV)
The Seller will to ensure that each Vendor of repairable components will
deliver to the Buyer a Component Maintenance Manual Vendor with revision
service.
6. STRUCTURAL MANUALS
6.1 NONDESTRUCTIVE TESTING MANUAL (NTM)
The NTM supplies Airframe data necessary to carry out nondestructive
testing.
6.2 STRUCTURAL REPAIR MANUAL (SRM)
The SRM contains descriptive information for identification and repair of
the Airframe primary and secondary structure and will include substantial
structural analysis.
Exh. F-9
<Page>
FORM
AC APERTURE CARD. Refers to 35mm film contained on punched aperture cards.
CD CD-ROM.
D FLOPPY DISK
F MICROFILM. Refers to 16mm roll film in 3M type cartridges.
MP Refers to paper printed one side, unpunched quality will be suitable for
further reproduction or microfilming.
MT MAGNETIC TAPE
P1 PRINTED ONE SIDE. Refers to manuals in paper with print on one side of the
sheets only.
P2 PRINTED BOTH SIDES. Refers to manuals with print on both sides of the
sheets.
SMF SILVER MASTER FILM. Refers to thick diazo film suitable for further
reproduction.
+ Denotes a combined A319/A320/A321 Technical Publication.
* Denotes Technical Publications will be supplied in SGML format if such
format becomes available from the Manufacturer.
TYPE
C CUSTOMIZED. Refers to manuals which are customized to specific MSNs.
E ENVELOPE. Refers to manuals which are not customized.
P PRELIMINARY. Refers to preliminary data or manuals which may consist of:
-either one time issue not maintained by revision service, or
-preliminary issues maintained by revision service until final manual or
data delivery, or
-supply of best available data under final format with progressive
completion through revision service.
Exh. F-10
<Page>
DELIVERY
Manual delivery is expressed either as the number of days prior to delivery of
the first Aircraft or as nil (0), which designates the date of delivery of the
first Aircraft.
It is agreed that the number of days indicated will be rounded up to the next
regular revision release date.
MANUALS AVAILABLE (HEADLINES)
1 - ENGINEERING DOCUMENTS
2 - MAINTENANCE & ASSOCIATED MANUALS
3 - MISCELLANEOUS PUBLICATIONS
4 - OPERATIONAL MANUALS AND DATA
5 - OVERHAUL DATA
6 - STRUCTURAL MANUALS
Exh. F-11
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
1. ENGINEERING DOCUMENTS
--------------------------------------------------------------------------------
+ Installation and Assembly IAD C AN(1) 0
* Drawings (including detail
drawings)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Parts Usage (Effectivity) PU E AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Schedule (Drawing S E AN 0
* Nomenclature)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Drawing Number Index DNI C AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Process and Material PMS E AN 0
* Specification
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Standard Manual SM E AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Electrical Load Analysis ELA E 2 AN 0
--------------------------------------------------------------------------------
2. MAINTENANCE & ASSOCIATED MANUALS
--------------------------------------------------------------------------------
+ APU Build-up Manual ABM E AN 90
--------------------------------------------------------------------------------
</Table>
----------
(1) Revision service for the manufacture drawings is restricted to cover
the Aircraft configuration at delivery.
Exh. F-12
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Maintenance Manual AMM C 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Schematics Manual ASM C 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Wiring Manual AWM C 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Wiring Lists AWL C 4 90
--------------------------------------------------------------------------------
+ Consumable Material List CML E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Component Location Manual CLM 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Duct Repair Manual DRM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Fuel Pipe Repair Manual FPRM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Illustrated Parts Catalog IPC C 4 90
(Airframe)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Illustrated Parts Catalog PIPC C 4 90
(Power Plant)(2)
--------------------------------------------------------------------------------
</Table>
----------
(2) Supplied by the Propulsion Systems manufacturer.
Exh. F-13
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
+ Illustrated Tool and Equipment TEM E AN 360
* Manual
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Maintenance Facility Planning MFP E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Maintenance Facility Planning MFP E AN 360
Document
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Power Plant Build-up Manual(3) PPBM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Support Equipment Summary SES E AN 360
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Time Limits and Maintenance TLMC/ C 4 90
Checks/Service Limits and SLMC
Maintenance Checks
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Tool and Equipment Drawings TED E AN 360
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Tool and Equipment Drawing Index TEI E AN 360
* Index
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Trouble Shooting Manual TSM C 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Documentation ADRES C 4 90
--------------------------------------------------------------------------------
</Table>
----------
(3) Supplied by the Propulsion Systems manufacturer.
Exh. F-14
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
* Retrieval System
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Computer Assisted Aircraft CAATS C 4 90
* Troubleshooting
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Time Limits and Maintenance TLMC C 4 90
Checks
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
3. MISCELLANEOUS PUBLICATIONS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Airplane Characteristics for AC E AN 360
* Airport Planning
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Aircraft Recovery Manual ARM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Crash Crew Chart CCC E AN 180
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Guidelines for Customer GCOC E AN 0
Originated Changes
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ List of Radioactive and LRE E AN 90
Hazardous Elements
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ List of Applicable Publications LAP C 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</Table>
Exh. F-15
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
+ Livestock Transportation LTM E AN 90
Manual
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Service Bulletins SB C AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Service Bulletin Index SBI E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Service Information Letters SIL E AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Technical Publications TPCI C AN 90
* Combined Index
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Transportability Manual TM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Supplier Product Support SPSA E AN 360
Agreements (SPSA)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
* Vendor Information Manual VIM E AN 360
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Vendor Information Manual VIM\ E AN 360
* GSE GSE
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
4. OPERATIONAL MANUALS AND DATA
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</Table>
Exh. F-16
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
+ Check CL/QRH C AN 90
List/Abnormal/Emergency/
Quick Reference Handbook
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ FAA Approved Flight Manual AFM C AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Flight Crew Operating Manual FCOM C AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Master Minimum Equipment MMEL E AN 90
List
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Performance Engineering Program PEP E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Performance Program Manual PPM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Weight and Balance Manual WBM C AN 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
5. OVERHAUL DATA
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Cable Fabrication Manual CFM E AN 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Component Documentation CDS C AN 180
* Status
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</Table>
Exh. F-17
<Page>
<Table>
<Caption>
--------------------------------------------------------------------------------
MANUALS AVAILABLE ABBR FORM TYPE QTY. REV DELIV.
(DETAILED)
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Component Evolution List(4) CEL E AN 180
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Component Maintenance CMMM E AN 180
* Manual Airframe Manufacturer
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Component Maintenance CMMV P2 E 10 AN 180
Manual Vendor
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
6. STRUCTURAL MANUALS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Nondestructive Testing Manual NTM E 4 90
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
+ Structural Repair Manual SRM E 4 90
--------------------------------------------------------------------------------
</Table>
----------
(4) Component evaluation list.
Exh. F-18
<Page>
APPENDIX 1 TO EXHIBIT F
LICENSE FOR USE OF THE PERFORMANCE ENGINEER'S PROGRAMS
1. GRANT
The Seller grants the Buyer the right to use the Performance Engineer's
Program (PEP) in machine-readable form during the term of this license on
a single computer.
Use of the PEP in readable form will be limited to one (1) copy other than
the copies contained in the single computer and copies produced for
checkpoint and restart purposes or additional copies made with the consent
of the Seller for a specific need.
2. MERGING
The PEP may be used and adapted in machine-readable form for the purpose
of merging it into other program material of the Buyer but on termination
of this Agreement; the PEP will be removed from the other program material
with which it has been merged.
The Buyer agrees to reproduce the copyright and other notices as they
appear on or within the original media on any copies, which the Buyer
makes of the PEP.
3. PERSONAL LICENSE
The above-described license is personal to the Buyer, non-transferable and
non-exclusive.
4. INSTALLATION
It is the Buyer's responsibility to install the PEP and to perform any
merging and checks. The Seller will however assist the Buyer's operations
engineers in the initial phase following the delivery of the PEP until
such personnel reach the familiarization level required to make inputs and
correlate outputs.
5. PROPRIETARY RIGHTS AND NONDISCLOSURE
5.1 The PEP and the copyright and other proprietary rights of whatever nature
in the PEP are and will remain with the Seller. The PEP and its contents
are designated as confidential.
5.2 The Buyer undertakes not to disclose the PEP or parts thereof and its
contents to any third party without the prior written consent of the
Seller. In so far as it is necessary to disclose aspects of the PEP to
employees, such disclosure is permitted
Exh. F, App. 1-1
<Page>
only for the purpose for which the PEP is supplied and only to the
employee who needs to know the same.
6. CONDITIONS OF USE
6.1 The Seller does not warrant that the PEP will not contain errors. However,
should the PEP be found to contain any error within thirty (30) days of
delivery, the Buyer will notify the Seller promptly thereof and the Seller
will take all proper steps to correct the same at its own expense.
6.2 The Buyer will ensure that the PEP is correctly used in appropriate
machines as indicated in the Performance Programs Manual (PPM) and that
staff are properly trained to use the same, to trace and correct running
faults, to restart and recover after fault and to operate suitable checks
for accuracy of input and output.
6.3 It is understood that the PPM is the user's guide of the PEP and the Buyer
will undertake to use the PEP in accordance with the PPM.
6.4 THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND REMEDIES OF
THE BUYER SET FORTH IN THIS LICENCE ARE EXCLUSIVE AND IN SUBSTITUTION FOR.
AND THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ALL OTHER WARRANTIES,
OBLIGATIONS AND LIABILITIES OF THE SELLER AND THE RIGHTS, CLAIMS OR
REMEDIES OF THE BUYER AGAINST THE SELLER, EXPRESS OR IMPLIED, ARISING BY
LAW OR OTHERWISE, WITH RESPECT TO ANY NON CONFORMITY OR DEFECT IN THE PEP
DELIVERED UNDER THIS LICENCE.
7. DURATION
The rights under this license will be granted to the Buyer as long as the
buyer operates a Seller's Aircraft model to which the PEP refers. When the
Buyer stops operating said Aircraft model, the Buyer will return the PEP
and any copies thereof to the Seller, accompanied by a notice certifying
that the Buyer has returned all existing copies.
Exh. F, App. 1-2
<Page>
APPENDIX 2 TO EXHIBIT F
LICENSE FOR USE OF CD-ROM
1. GRANT
1.1 The Seller grants the Buyer the right to use the Aircraft Documentation
Retrieval System (ADRES) and/or the Computer Assisted Aircraft Trouble
Shooting (CAATS) on CD-ROM for the term of this License. Use of ADRES
and/or CAATS will be limited to the number of copies defined between the
panics.
FOR CLARIFICATION, IT IS HEREBY STATED RUM THE POWER PLANT IPC IS NOT PART
OF THE ELECTRONIC IPC AND IS ONLY AVAILABLE ON OTHER MEDIA (PAPER OR
FILM).
1.2 The above grant will be free of charge for as long as the revisions of
CAATS and ADRES are free of charge in accordance with Clause 14. At the
end of such period(s) license fees will be charged to the Buyer at the
price stated in the then current Seller's Customer Services Catalog.
2. TERM
The rights under the License will be granted from the date of first
delivery of ADRES and/or CAATS as long as the Buyer operates the Aircraft
or until a replacement product will be provided by the Seller, whichever
occurs first. Within thirty (30) days of termination, the Buyer will
return ADRES and/or CAATS and all copies thereof to the Seller.
3. REVISION SERVICE
The Seller will provide revision service for ADRES and/or CAATS during the
term. The revision service will be based on the revision service, which
the Seller provides for the documentation in paper or film format.
ADRES and/or CAATS CD-ROM will be revised concurrently with the paper and
film deliveries. Temporary revisions will be provided in digital format
under the form of 3-1/2 floppy disk. The retrieval software for such
temporary revisions will be embodied on the CAATS and ADRES CD-ROM.
4 PERSONAL LICENSE
The License is personal to the Buyer, nontransferable and nonexclusive.
The Buyer will not permit any third party to use ADRES and/or CAATS. nor
will it transfer or sublicense ADRES and/or CAATS to any third party,
without prior written consent from the Seller.
Exh. F, App. 2-1
<Page>
5. INSTALLATION
The Seller will provide the list of hardware on which ADRES and/or CAATS
will be installed. The Buyer will be responsible for procuring such
hardware and installing ADRES and/or CAATS.
6. PROPRIETARY RIGHTS
ADRES and/or CAATS are proprietary to the Seller and the copyright and all
other proprietary rights in ADRES and/or CAATS are and will remain the
property of the Seller.
7. COPYRIGHT INDEMNITY
The Seller will defend and indemnify the Buyer against any claim that the
normal use of ADRES and/or CAATS infringes the intellectual property
rights of any third party, provided that the Buyer
(i) immediately notifies the Seller of any such claim;
(ii) makes no admission or settlement of any claim;
(iii) allows the Seller to have sole control of all negotiations for its
settlement;
(iv) gives the Seller all reasonable assistance in connection therewith.
8. CONFIDENTIALITY
ADRES and/or CAATS and their contents are designated as confidential. The
Buyer undertakes not to disclose ADRES and/or CAATS or parts thereof to
any third party without the prior written consent of the Seller. In so far
as it is necessary to disclose aspects of ADRES and/or CAATS to the
employees, such disclosure is permitted solely for the purpose for which
ADRES and/or CAATS are supplied and only to those employees who need to
know the same.
9. CONDITIONS OF USE
9.1 The Buyer will not make any copies of ADRES and/or CAATS, except for
installation purposes.
9.2 The Seller does not warrant that the operation of ADRES and/or CAATS will
be error free. In the event of an error occurring within thirty (30) days
of delivery, the sole and exclusive liability of the Seller will be, at
its expense, to correct ADRES and/or CAATS in the following revision.
9.3 THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND REMEDIES OF
THE BUYER SET FORTH IN THIS LICENCE ARE EXCLUSIVE AND IN SUBSTITUTION FOR,
AND THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ALL OTHER WARRANTIES,
Exh. F, App. 2-2
<Page>
OBLIGATIONS AND LIABILITIES OF THE SELLER AND THE RIGHTS, CLAIMS OR
REMEDIES OF THE BUYER AGAINST THE SELLER, EXPRESS OR IMPLIED, ARISING BY
LAW OR OTHERWISE, WITH RESPECT TO ANY NON CONFORMITY OR DEFECT IN THE
ADRES AND/OR CAATS DELIVERED UNDER THIS LICENCE.
10. TRAINING
In addition to the user guide supplied with ADRES and/or CAATS, training
and other assistance may be provided on the Buyer's request at conditions
to be mutually agreed.
11. REPLACEMENT OF PRODUCT
For clarification purposes it is hereby expressly stared that ADRES and/or
CAATS will be offered for a limited time period, not exceeding the term of
this License. In the event that the Seller should offer a replacement
product, the conditions for using such product will be subject to a
separate agreement.
Exh. F, App. 2-3
<Page>
EXHIBIT G
AIRFRAME PRICE REVISION FORMULA
1. BASE PRICE
The Base Price of the Airframe is as quoted in Clause 3.1.1 of the
Agreement.
2. BASE PERIOD
The above Base Price has been established in accordance with the averaged
economic conditions prevailing in December 1997/January 1998/February 1998
and corresponding to theoretical delivery conditions prevailing in January
1999 as defined by ECIb and ICb index values indicated in Paragraph 4 of
this Exhibit G.
This Base Price is subject to adjustment for changes in economic
conditions as measured by data obtained from the US Department of Labor,
Bureau of Labor Statistics, and in accordance with the provisions of
Paragraphs 4 and 5 of this Exhibit G.
ECIb and ICb index values indicated in Paragraph 4 of this Exhibit G will
not be subject to any revision of these indexes.
3. REFERENCE INDEXES
LABOR INDEX: Published quarterly by the US Department of Labor, Bureau of
Labor Statistics, in "News" (Table 6: "Employment Cost Index for wages and
salaries for private industry workers by industry and occupational group"
(NOT SEASONALLY ADJUSTED), or such other names that may be from time to
time used for the publication title and/or table. The index is found under
aircraft manufacturing with a standard industrial classification code of
SIC 3721 and hereinafter is referred to as "ECI-SIC-3721W" (Base month and
year June l989 = 100).
MATERIAL INDEX: "Industrial Commodities" (hereinafter referred to as
"IC-Index"), published monthly by the US Department of Labor, Bureau of
Labor Statistics, in "PPI Detailed Report" (Table 6: Producer prices
indexes and percent changes for commodity groupings and individual items,
not seasonally adjusted) (Base year 1982 = 100) or such other names which
may be from time to time used for the publication title and/or table.
Exh. G-1
<Page>
4. REVISION FORMULA
Pn = (Pb + F) ([****] ECIn/ECIb + [****] ICn/ICb)
Where
Pn = Revised Base Price of the Airframe.
Pb = Base Price of the Airframe at economic conditions December
1997/January 1998/February 1998 averaged (January 1999
delivery conditions).
F = (0.005 x N x Pb) Where N = The calendar year of delivery of
the Aircraft minus 1999.
ECIn = The arithmetic average of the latest published values
available at the date of Aircraft delivery for ECI-SIC-3721W
for the 11th, 12th and 13th months prior to the month of
delivery of the Aircraft (1 decimal), where the quarterly
value for the third month of a quarter (March, June, September
and December) will be deemed to apply for the two preceding
months).
ECIb = ECI-SIC-3721W for December 1997/January 1998/February 1998
averaged (= 134.7).
ICn = The arithmetic average of the latest published values
available at the date of Aircraft delivery for the IC-Index
for the 11th. 12th and 13th months prior to the month of
delivery of the Aircraft (1 decimal),
ICh = IC-Index for December 1997/January 1998/February 1998 averaged
(=126.1).
In determining the Revised Base Price at delivery of the Aircraft, each quotient
will be calculated to the nearest ten thousandth (4 decimals). If the next
succeeding place is five (5) or more, the preceding decimal place will be raised
to the next higher figure. The final factor will he rounded to the nearest ten
thousandth (4 decimals). After final computation, Pn will be rounded to the next
whole number (0.5 or more rounded to 1).
Exh. G-2
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
<Page>
5. GENERAL PROVISIONS
5.1 SUBSTITUTION OF INDEXES
In the event that:
(i) the U.S. Department of Labor substantially revises the methodology
of calculation of any of the indexes referred to hereabove, or
(ii) the U.S. Department of Labor discontinues, either temporarily or
permanently, any of the indexes referred to hereabove, or
(iii) the data samples used to calculate any of the indexes referred to
hereabove are substantially changed,
the Seller will select a substitute index,
Such substitute index will reflect as closely as possible the actual
variations of the wages or of the material costs, as the case may be, used
in the calculation of the original index.
As a result of this selection of a substitute index, the Seller will make
an appropriate adjustment to its price revision formula, allowing to
combine the successive utilization of the original index and of the
substitute index.
5.2 FINAL INDEX VALUES
The Revised Base Price at the date of Aircraft delivery will be final and
will not be subject to further adjustments of any kind and for any reason
to the applicable indexes as published at the date of Aircraft delivery.
Exh. G-3
<Page>
EXHIBIT H
INTERNATIONAL AERO ENGINES PRICE REVISION FORMULA
1. REFERENCE PRICE
The Reference Price of the Propulsion Systems is as quoted in Clause 3.1.2
of the Agreement.
This Reference Price is valid for Aircraft delivered no later than
December 31, 2005, and is subject to adjustment for changes in economic
conditions as measured by data obtained from the US Department of Labor,
Bureau of Labor Statistics, and in accordance with the provisions of
Paragraphs 4 and 5 of this Exhibit H.
2. REFERENCE PERIOD
The above Reference Price has been established in accordance with thc
economic conditions prevailing in September 1996 (or January 1997
theoretical delivery conditions) as defined, according to International
Aero Engines, by the HEb, MMPb and EPb index values indicated in Paragraph
4 of this Exhibit H.
3. INDEXES
LABOR INDEX: "Aircraft Engines and Engine Parts," Standard Industrial
Classification 3724--Average hourly earnings (hereinafter referred to as
"HE SIC 3724"), published by the US Department of Labor, Bureau of Labor
Statistics, in "Employment and Earnings," (Table B-15: Average hours and
earnings of production or nonsupervisory workers on private nonfarm
payrolls by detailed industry) or such other names which may be from time
to time used for the publication title and/or table.
MATERIAL INDEX: "Metals and Metal Products" Code 10 (hereinafter referred
to as "MMP-Index"), published monthly by the US Department of Labor,
Bureau of Labor Statistics, in "PPI Detailed Report" (Table 6: Producer
prices indexes and percent changes for commodity groupings and individual
items, not seasonally adjusted) (Base year 1982 = 100) or such other names
which may be from time to time used for the publication title and/or
table.
ENERGY INDEX: "Fuels and Related Products and Power" Code 5 (hereinafter
referred to as "EP-Index"), published monthly by the US Department of
Labor, Bureau of Labor Statistics, in "PPI Detailed Report" (Table 6:
Producer prices indexes and percent changes for commodity groupings and
individual items, not seasonally adjusted) (Base year 1982 = 100) or such
other names which may be from time to time used for the publication title
and/or table.
Exh. H-1
<Page>
4. REVISION FORMULA
Pn = Pb [([****] HEn)/HEb + ([****] MMPn)/MMPb + ([****] EPn)/EPb]
Where
Pn = Revised Reference Price of a set of two (2) Propulsion Systems
at delivery of the Aircraft.
Pb = Reference Price at September 1996 economic conditions.
HEn = HE SIC 3724 for the fourth month prior to the month of
delivery of the Aircraft.
HEb = HE SIC 3724 for September 1996 (= 18.40)
MMPn = MMP-Index for the fourth month prior to the month of delivery
of the Aircraft.
MMPb = MMP-Index for September 1996 (= 130.0)
EPn = EP-Index for the fourth month prior to the month of delivery
of the Aircraft.
EPb = EP-Index for September 1996 (= 87.1)
In determining the Revised Reference Price each quotient (([****]
HEn)/HEb, ([****] MMPn)/MMPb, ([****] EPn)/EPb) will be calculated to the
nearest ten thousandth (4 decimals). If the next succeeding place is
five (5) or more the preceding decimal place will be raised to the next
higher figure.
After final computation, Pn will be rounded to the next whole number (0.5
or more rounded to 1).
Exh. H-2
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
<Page>
5. GENERAL PROVISIONS
5.1 The Revised Reference Price at delivery of the Aircraft will be the final
price and will not be subject to further adjustments in the indexes.
5.2 If no final index value is available for any of the applicable months, the
published preliminary figures will be the basis on which the Revised
Reference Price will be computed.
5.3 If the US Department of Labor substantially revises the methodology of
calculation of the indexes referred to in this Exhibit H or discontinues
any of these indexes, the Seller will, in agreement with International
Aero Engines, the Propulsion Systems manufacturer, apply a substitute for
the revised or discontinued index, such substitute index to lead in
application to the same adjustment result, insofar as possible, as would
have been achieved by continuing the use of the original index as it may
have fluctuated had it not been revised or discontinued.
5.4
Appropriate revision of the formula will be made to accomplish this
result.
5.4 Should the above escalation provisions become null and void by action of
the US Government, the Reference Price will be adjusted to reflect
increases in the cost of labor, material and fuel which have occurred from
the period represented by the applicable Reference Price Indexes to the
fourth month prior to the scheduled delivery of the Aircraft.
5.5 The Revised Reference Price at delivery of the Aircraft in no event will
be less than the Reference Price defined in Paragraph 1 of this Exhibit H.
Exh. H-3
<Page>
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: ENGINE CONTRACT
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement (the "Letter Agreement") certain additional terms and
conditions regarding the sale of the Aircraft. Capitalized terms used herein and
not otherwise defined in this Letter Agreement will have the meanings assigned
thereto in the Agreement. The terms "herein," "hereof" and "hereunder" and words
of similar import refer to this Letter Agreement.
The Buyer and the Seller acknowledge that, as of the date of execution of
the Agreement, the Buyer has not yet executed a purchase agreement with a
propulsion systems manufacturer for a propulsion system to be installed on the
Aircraft (the "Engine Contract"). The Buyer further acknowledges that (a) it
will undertake to execute the Engine Contract with International Aero Engines
("IAE") by negotiating in good faith with IAE, in line with the terms and spirit
of the V2500-A5 Propulsion System Commitment Letter, between the Buyer and IAE,
dated March 4, 1999, and (b) it will not solicit or entertain any unsolicited
proposal regarding the purchase or lease of Boeing aircraft nor will it enter
into any agreement, whether oral or in writing, to purchase or lease Boeing
aircraft.
In the event that the Buyer, its best efforts notwithstanding, has not
executed an Engine Contract by May 10, 1999 (the "Date"), then the Buyer will
give notice to the Seller of its failure to have executed an Engine Contract.
Upon receipt of such notice, the Seller and the Buyer will extend the Date to a
new date (the "New Date"). If on the New Date no Engine Contract has been
executed, the Buyer will make its best efforts to negotiate in good faith with
CFM International to execute an Engine Contract and the Seller and the Buyer
will agree to extend the New Date to a new date (the "Revised New Date").
If on the Revised New Date an Engine Contract has still not been executed,
then the Buyer may give notice to the Seller that it terminates the Agreement.
In the event of such termination, the Seller will reimburse the Buyer for any
and all predelivery payments theretofore made by Buyer pursuant to the
Agreement; the Seller will retain the Deposits. After such termination, the
parties will have no further rights or obligations to one another under the
Agreement.
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the Buyer
hereunder will not be assigned or transferred in any manner without the prior
written consent of the Seller, and any attempted assignment or transfer in
contravention of the provisions of this Paragraph 4 will be void and of no force
or effect.
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: __________________________________
Its: __________________________________
Date: __________________________________
Accepted and Agreed
New Air Corporation
By: __________________________________
Its: __________________________________
Date: __________________________________
2
<Page>
Amendment No. 1
To the A320 Purchase Agreement
Dated as of April 20, 1999
Between
AVSA, S.A.R.L.
And
JetBlue Airways Corporation
This amendment No. 1 (hereinafter referred to as the "Amendment") is entered
into as of September 30th 1999, between AVSA, S.A.R.L., a societe a
reponsabilite 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 JetBlue
Airways Corporation, a corporation organized and existing under the laws of the
State of Delaware, United States of America, having its principal corporate
offices located at 6322 South 3000 East, Suite L-201, Salt Lake City, UT 84121,
USA (hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft") which,
together with all Exhibits, Appendixes and Letter Agreements attached thereto is
hereinafter called the "Agreement."
WHEREAS, the Seller and the Buyer have agreed to amend Clause 9 and Clause 21 of
the Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
<Page>
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein shall have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. CLAUSE 9
The delivery schedule for the Firm Aircraft No 5 described in Clause 9.1.1
of the Agreement, which reads "[****] 2000" is hereby canceled and
replaced by the following quoted provisions:
QUOTE
[****] 2000
UNQUOTE
3. CLAUSE 21
The first line of Clause 21.1.1(11) of the Agreement, which reads "The
Buyer fails to meet any one of the following conditions:" is hereby
canceled and replaced by the following quoted provisions:
QUOTE
Any one of the following conditions obtains:
UNQUOTE
4. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. Both parties agree that this
Amendment shall constitute an integral, nonseverable part of the Agreement
and be governed by its provisions, except that if the Agreement and this
Amendment have specific provisions that are inconsistent, the specific
provisions contained in this Amendment shall govern.
5. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
Amdt 1-2
<Page>
If the foregoing correctly sets forth our understanding, please indicate your
acceptance by signing in the space provided below.
Very truly yours,
AVSA, S.A.R.L.
By: /s/ Michele LASCAUX
------------------------------------
Its: Director Contracts
-----------------------------------
Accepted and Agreed,
JETBLUE AIRWAYS CORPORATION
By: /s/ Thomas E. Kelly
--------------------------
Its: EXECUTIVE VICE PRESIDENT
-------------------------
Amdt 1-3
<Page>
Amendment No. 2
To the A320 Purchase Agreement
Dated as of April 20, 1999
Between
AVSA, S.A.R.L.
And
JetBlue Airways Corporation
This Amendment No. 2 (the "Amendment") is entered into as of March 13 2000,
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 (the "Seller"),
and JetBlue Airways Corporation, a corporation organized and existing under the
laws of the State of Delaware, USA, having its principal corporate offices
located at 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York, 11415 USA
(the "Buyer").
WITNESSETH
WHEREAS, the Buyer and Seller have entered into an Airbus A320 Purchase
Agreement dated as of April 20, 1999, which, together with all Exhibits,
Appendixes and Letter Agreements attached thereto and as amended by Amendment
No. 1 dated as of September 30, 1999 (the "Agreement"), covers, among other
things, the sale by the Seller and the purchase by the Buyer of certain Airbus
Industrie A320-200 aircraft (the "Buyer's Aircraft"), under the terms and
conditions set forth in said Agreement,
WHEREAS, the Buyer has leased or will lease from certain lessors Airbus
Industrie A320 aircraft (the "Leased Aircraft"),
WHEREAS, the Buyer intends to install satellite television systems, which
systems will include, but not be limited to, antennas, radomes, equipment racks,
and cabin screens ("LiveTV") on certain of the Buyer's Aircraft and the Leased
Aircraft (such Buyer's Aircraft and Leased Aircraft, the "Aircraft"),
WHEREAS, as a result of the Buyer's decision to install LiveTV on the Aircraft,
the Buyer and Seller have agreed to set forth in this Amendment certain
additional terms and conditions, amendments to Clause 12.2 of the Agreement and
Letter Agreement No. 7 to the Agreement.
<Page>
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined in this Amendment
will have the meanings assigned thereto in the Agreement. The terms
"herein", "hereof" and "hereunder" and words of similar import refer to
this Amendment.
2. ADDITIONAL TERMS AND CONDITIONS
2.1 SELLER'S REPORT
2.1.1 The Buyer and Seller agree to certain terms and conditions under which the
Seller has purchased or will purchase from the Manufacturer for sale to
the Buyer structural substantiation reports (the "Reports") that are
limited to the impact of LiveTV on the Aircraft structures around the:
(i) antenna radome attachments, and
(ii) electronic rack in the cargo hold.
2.1.2 The Buyer acknowledges that the Report is limited to an analysis of:
(i) stress,
(ii) fatigue life and damage/tolerance, and
(iii) repercussions on the maintenance program.
2.1.3 The Seller's involvement in the FAA supplemental type certificate
certifying the installation and operation of LiveTV (the "STC") is limited
to the provision of the Reports.
2.1.4 The Buyer further acknowledges that in preparing the Reports, the Seller
has relied on data provided by the Buyer, which the Seller has not
independently verified.
2.2 PRICE AND PAYMENT
2.2.1 PRICE
The price for the Report (the "Price") is USD [****].
2.2.2 PAYMENT TERMS
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
2
<Page>
Upon receipt of an invoice, the Buyer will pay the Price in immediately
available funds in United States dollars to Credit Lyonnais, New York,
for transfer by Credit Lyonnais to the Seller's account with Credit
Lyonnais at 1, Esplanade Compans Caffarelli, 31000 Toulouse, France, or
such other account as may be designated by the Seller.
2.3 INSTALLATION
The Buyer and the Seller agree that the Seller will bear no responsibility
whatsoever for any costs pertaining or related to the installation or
operation of LiveTV.
3. AMENDMENTS
3.1 CLAUSE 12.2
3.1.1 The Service Life Policy as described in Clause 12.2 of the Agreement is
hereby amended by the addition of the following quoted provision as Clause
12.2.6:
QUOTE
12.2.6 The Buyer agrees that if a Failure occurs in an Item and the Seller
determines that the cause of the Failure is attributable to any
component of the satellite television systems, including, but not
limited to, antennas, radomes, equipment racks, and cabin screens
that are installed on the Aircraft ("LiveTV") or the installation
thereof:
(i) the Seller will have no obligation whatsoever to design
or furnish a correction or replace the Item, and
(ii) Clause 12.2.2 and Clause 12.2.3 will not apply to such
Failure.
UNQUOTE
3.2 LETTER AGREEMENT NO. 7
3.2.1 Clause 4.6 of Letter Agreement No. 7 to the Agreement, which lists the
Excluded Delays to the dispatch reliability guarantee, is hereby amended
by the addition of the following quoted provision as Section 10 and
Section 11:
QUOTE
(10) Delays attributable to the malfunction of any component of the
satellite television systems, including, but not limited to,
antennas, radomes, equipment racks, and cabin screens that are
installed on the Aircraft ("LiveTV").
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
3
<Page>
(11) Delays attributable to the performance of the Aircraft or Aircraft
Systems due to the installation or operation of LiveTV.
UNQUOTE
4. WARRANTY AND INDEMNITY
4.1 THE SELLER MAKES NO WARRANTY OF ANY KIND OR NATURE WITH RESPECT TO THE
REPORT SUPPLIED HEREUNDER, AND THE BUYER HEREBY WAIVES, RELEASES AND
RENOUNCES ALL RIGHTS, CLAIMS AND REMEDIES OF THE BUYER AGAINST THE SELLER,
WHETHER EXPRESS OR IMPLIED BY CONTRACT, TORT, OR STATUTORY LAW OR
OTHERWISE, WITH RESPECT TO THE DESIGN, INSTALLATION, OPERATION OR EFFECT
OF LIVETV.
In consideration of the Seller's provision of the Report under this
Amendment, the Buyer hereby forever releases the Seller, its affiliates,
assigns, agents, representatives and employees from any and all
obligations, claims, losses, liabilities, costs, expenses and damages with
respect to the:
(i) issuance of the STC,
(ii) installation of LiveTV in or on the Aircraft,
(iii) performance of LiveTV, and
(iv) performance of the Aircraft as a result of the installation or
operation of LiveTV.
4.2 The Buyer will indemnify and hold the Seller, its affiliates, agents,
representatives and employees harmless from and against all losses,
liabilities, costs, expenses and damages, including court costs and
reasonable attorney's fees, arising from claims by third parties for
personal injuries and/or death and/or property damage arising out of the:
(i) issuance of the STC,
(ii) installation of LiveTV in or on the Aircraft,
(iii) performance of LiveTV, and
(iv) performance of the Aircraft as a result of the installation or
operation of LiveTV.
4
<Page>
5. EFFECT OF THE AMENDMENT
The Agreement will be deemed to be amended to the extent herein provided,
and except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of said Agreement, and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions in this Amendment will
govern.
6. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
7. SEVERABILITY
In the event that any provision of this Amendment should for any reason be
held to be without effect, the remainder of this Amendment will remain in
full force and effect. To the extent permitted by applicable law, each
party hereto hereby waives any provision of law that renders any provision
of this Amendment prohibited or unenforceable in any respect.
8. HEADINGS
All headings in this Amendment are for convenience of reference only and
do not constitute a part of this Amendment.
9. COUNTERPARTS
This Amendment may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered will be an
original, but all such counterparts will together constitute but one and
the same instrument.
5
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Michele Lascaux
------------------------
MICHELE LASCAUX
Its: Director Contracts
------------------------
Date: March 13, 2000
------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T. E. Anderson
-------------------------
Its: VICE PRESIDENT
-------------------------
Date: March 18, 2000
-------------------------
6
<Page>
Amendment No. 3
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 3 (hereinafter referred to as the "Amendment") is entered
into as of March 29, 2000, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), including
twenty-five option aircraft (the "Option Aircraft"), which, together with all
Exhibits, Appendixes and Letter Agreements attached thereto and as amended by
Amendment No. 1, dated as of September 30, 1999, and Amendment No. 2, dated as
of March 13, 2000, is hereinafter called the "Agreement."
WHEREAS, the Buyer desires to exercise its option to firmly order certain Option
Aircraft.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
AM No. 3-1
<Page>
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. DELIVERY SCHEDULE
2.1 The Buyer hereby exercises its option under Paragraph 2.1 of Letter-
Agreement No. 4 to the Agreement to firmly order Option Aircraft Nos. 26,
27, 28, 47, 48, 49 and 50 (the "Firmly Ordered Option Aircraft"). Further,
the Buyer and the Seller agree to [****].
2.2 In accordance with Paragraph 3.1 of Letter Agreement No. 4 to the
Agreement, as a consequence of the Buyer's exercising its option to firmly
order seven (7) Option Aircraft, the Seller offers the Buyer delivery
positions for seven (7) A320 Additional Option Aircraft.
2.3 As a consequence of Paragraphs 2.1 and 2.2 above, the delivery schedule
set forth in Clause 9.1.1 of the Agreement is hereby canceled and replaced
by the following quoted provisions:
QUOTE
<Table>
<S> <C> <C>
Firm Aircraft No 1 [****] 2000
Firm Aircraft No 2 [****] 2000
Firm Aircraft No 3 [****] 2000
Firm Aircraft No 4 [****] 2000
Firm Aircraft No 5 [****] 2000
Firm Aircraft No 6 [****] 2000
Firm Aircraft No 7 [****] 2001
Firm Aircraft No 8 [****] 2001
Firm Aircraft No 9 [****] 2001
Firm Aircraft No 10 [****] 2001
Firm Aircraft No 11 [****] 2001
Firm Aircraft No 12 [****] 2001
Firm Aircraft No 13 [****] 2002
Firmly Ordered Option Aircraft No 14 [****] 2002
Firm Aircraft No 15 [****] 2002
Firmly Ordered Option Aircraft No 16 [****] 2002
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 3-2
<Page>
<Table>
<S> <C> <C>
Firm Aircraft No 17 [****] 2002
Firm Aircraft No 18 [****] 2002
Firm Aircraft No 19 [****] 2002
Firm Aircraft No 20 [****] 2002
Firm Aircraft No 21 [****] 2002
Firm Aircraft No 22 [****] 2002
Firm Aircraft No 23 [****] 2003
Firm Aircraft No 24 [****] 2003
Firm Aircraft No 25 [****] 2003
Firm Aircraft No 26 [****] 2003
Firm Aircraft No 27 [****] 2003
Firmly Ordered Option Aircraft No 28 [****] 2004
Firmly Ordered Option Aircraft No 29 [****] 2004
Firmly Ordered Option Aircraft No 30 [****] 2004
Firmly Ordered Option Aircraft No 31 [****] 2004
Firmly Ordered Option Aircraft No 32 [****] 2004
Option Aircraft No 33 [****] 2003
Option Aircraft No 34 [****] 2003
Option Aircraft No 35 [****] 2003
Option Aircraft No 36 [****] 2003
Option Aircraft No 37 [****] 2003
Option Aircraft No 38 [****] 2004
Option Aircraft No 39 [****] 2004
Option Aircraft No 40 [****] 2004
Option Aircraft No 41 [****] 2004
Option Aircraft No 42 [****] 2004
Option Aircraft No 43 [****] 2005
Option Aircraft No 44 [****] 2005
Option Aircraft No 45 [****] 2005
Option Aircraft No 46 [****] 2005
Option Aircraft No 47 [****] 2005
Option Aircraft No 48 [****] 2005
Option Aircraft No 49 [****] 2005
Option Aircraft No 50 [****] 2005
A320 Additional Option Aircraft No 51 [****] 2005
A320 Additional Option Aircraft No 52 [****] 2005
A320 Additional Option Aircraft No 53 [****] 2006
A320 Additional Option Aircraft No 54 [****] 2006
A320 Additional Option Aircraft No 55 [****] 2006
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 3-3
<Page>
<Table>
<S> <C> <C>
A320 Additional Option Aircraft No 56 [****] 2006
A320 Additional Option Aircraft No 57 [****] 2006
</Table>
UNQUOTE
2.4 [****]
3. DEPOSIT
In accordance with Paragraph 3 of Letter Agreement No. 4 to the Agreement,
within thirty (30) days of signature of this Amendment, the Buyer will
make a nonrefundable deposit of US$ [****] (US dollars--[****]) in
respect of each of A320 Additional Option Aircraft Nos. 51 through 57.
The Buyer's payment of these deposits will constitute acceptance of the
delivery positions for these A320 Additional Option Aircraft.
4. [****]
5. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 3-4
<Page>
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
6. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
7. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Agreement,
Paragraph 4 of this Amendment will not be assigned or transferred in any
manner without the prior written consent of the Seller, and any attempted
assignment or transfer in contravention of the provisions of this
Paragraph 7 will be void and of no force or effect.
AM No. 3-5
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Michele Lascaux
------------------------
MICHELE LASCAUX
Its: Director Contracts
------------------------
Date: March 29, 2000
------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T. E. Anderson
-------------------------
Its: VICE PRESIDENT
-------------------------
Date: March 29, 2000
-------------------------
AM No. 3-6
<Page>
Amendment No. 4
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 4 (hereinafter referred to as the "Amendment") is entered
into as of September 29th 2000, 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 JetBlue
Airways Corporation, a corporation organized and existing under the laws of the
State of Delaware, United States of America, having its principal corporate
offices located 80-02 Kew Gardens Road, 6th floor, Kew Gardens, New York, 11415
USA (hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), which,
together with all Exhibits, Appendixes and Letter Agreements attached thereto
and as amended by Amendment No. 1, dated as of September 30, 1999, Amendment No.
2, dated as of March 13, 2000, and Amendment No. 3, dated as of March 29, 2000,
is hereinafter called the "Agreement".
WHEREAS, the Seller and the Buyer have agreed to amend Clause 9 of the
Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
AM No. 4-1
<Page>
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. DELIVERY SCHEDULE
2.1 The Buyer and the Seller agree to [****].
2.2 The seller will [****] subject to its industrial and commercial
constraints to deliver August 2001 aircraft by the 10th of that month.
2.3 As a consequence of Paragraph 2.1 above, the delivery schedule set Forth
in Clause 9.1.1 of the Agreement is hereby canceled and replaced by the
following quoted provisions:
QUOTE
<Table>
<Caption>
CAC ID NR AIRCRAFT DELIVERY
<S> <C> <C> <C>
41 199 Firm Aircraft N0 1 [****] 2000
41 200 Firm Aircraft N0 2 [****] 2000
41 203 Firm Aircraft No 3 [****] 2000
41 201 Firm Aircraft N0 4 [****] 2000
41 202 Firm Aircraft No 5 [****] 2000
41 204 Firm Aircraft No 6 [****] 2000
41 205 Firm Aircraft No 7 [****] 2001
41 206 Firm Aircraft No 8 [****] 2001
41 210 Firm Aircraft No 9 [****] 2001
41 207 Firm Aircraft No 10 [****] 2001
41 208 Firm Aircraft No 11 [****] 2001
41 209 Firm Aircraft No 12 [****] 2001
41 211 Firm Aircraft No 13 [****] 2002
41 224 Firmly Ordered Option Aircraft No 14 [****] 2002
41 212 Firm Aircraft No 15 [****] 2002
41 225 Firmly Ordered Option Aircraft No 16 [****] 2002
41 213 Firm Aircraft No 17 [****] 2002
41 214 Firm Aircraft No 18 [****] 2002
41 215 Firm Aircraft No 19 [****] 2002
41 216 Firm Aircraft No 20 [****] 2002
41 217 Firm Aircraft No 21 [****] 2002
41 218 Firm Aircraft No 22 [****] 2002
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 4-2
<Page>
<Table>
<S> <C> <C> <C>
41 219 Firm Aircraft No 23 [****] 2003
41 220 Firm Aircraft No 24 [****] 2003
41 221 Firm Aircraft No 25 [****] 2003
41 222 Firm Aircraft No 26 [****] 2003
41 223 Firm Aircraft No 27 [****] 2003
41 226 Firmly Ordered Option Aircraft No 28 [****] 2004
41 245 Firmly Ordered Option Aircraft No 29 [****] 2004
41 246 Firmly Ordered Option Aircraft No 30 [****] 2004
41 247 Firmly Ordered Option Aircraft No 31 [****] 2004
41 248 Firmly Ordered Option Aircraft No 32 [****] 2004
41 227 Option Aircraft No 33 [****] 2003
41 228 Option Aircraft No 34 [****] 2003
41 229 Option Aircraft No 35 [****] 2003
41 230 Option Aircraft No 36 [****] 2003
41 231 Option Aircraft No 37 [****] 2003
41 232 Option Aircraft No 38 [****] 2004
41 233 Option Aircraft No 39 [****] 2004
41 234 Option Aircraft No 40 [****] 2004
41 235 Option Aircraft No 41 [****] 2004
41 236 Option Aircraft No 42 [****] 2004
41 237 Option Aircraft No 43 [****] 2005
41 238 Option Aircraft No 44 [****] 2005
41 239 Option Aircraft No 45 [****] 2005
41 240 Option Aircraft No 46 [****] 2005
41 241 Option Aircraft No 47 [****] 2005
41 242 Option Aircraft No 48 [****] 2005
41 243 Option Aircraft No 49 [****] 2005
41 244 Option Aircraft No 50 [****] 2005
69 719 A320 Additional Option Aircraft No 51 [****] 2005
69 720 A320 Additional Option Aircraft No 52 [****] 2005
69 721 A220 Additional Option Aircraft No 53 [****] 2006
69 722 A320 Additional Option Aircraft No 54 [****] 2006
69 723 A320 Additional Option Aircraft No 55 [****] 2006
69 724 A320 Additional Option Aircraft No 56 [****] 2006
69 725 A320 Additional Option Aircraft No 57 [****] 2006
</Table>
UNQUOTE
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 4-3
<Page>
3. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
4. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
AM No. 4-4
<Page>
WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
----------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
----------------------------
Date: September 29th, 2000
----------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T. E. Anderson
-------------------------
Its: VICE PRESIDENT
-------------------------
Date: September 29, 2000
------------------------
AM No. 4-5
<Page>
Amendment No. 5
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 5 (hereinafter referred to as the "Amendment") is entered
into as of November 7, 2000, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), which,
together with all Exhibits, Appendixes and Letter Agreements attached thereto
and as amended by Amendment No. 1, dated as of September 30, 1999, Amendment No.
2, dated as of March 13, 2000, Amendment No. 3, dated as of March 29, 2000, and
Amendment No. 4, dated as of September 29, 2000, is hereinafter called the
"Agreement."
WHEREAS, the Seller and the Buyer have agreed to amend some Clauses of the
Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
AM No. 5-1
<Page>
1. DEFINITIONS
Capitalized items used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. CLAUSE 0 - DEFINITIONS
The definition of the term "Balance of the Final Contract Price" is
deleted in its entirety and replaced by the following:
QUOTE
BALANCE OF THE FINAL CONTRACT PRICE - means the amount payable by the
Buyer 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 Buyer in respect of
such Aircraft on or before the Delivery Date for such Aircraft, [****].
UNQUOTE
3. [****]
3.1 PARAGRAPH 1
The text of Paragraph 1 is hereby deleted in its entirety and replaced by
the following quoted provisions:
QUOTE
[****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 5-2
<Page>
[****].
UNQUOTE
3.2 PARAGRAPH 4
Paragraph 4 shall be renumbered Paragraph 6,
3.3 NEW PARAGRAPH 4
The text of the new Paragraph 4 is hereby given in the following quoted
provisions:
QUOTE
4. PAYMENT IN FULL
Payment in full of the Notes, including principal, interest, overdue
interest, costs and expenses of collection and any and all other
amounts due in connection therewith, is the payment with respect to
promissory notes included in the definition of Balance of the Final
Contract Price as that term is used in Clause 5.4 of the Agreement.
UNQUOTE
3.4 NEW PARAGRAPH 5
The text of the new Paragraph 5 is hereby given in the following quoted
provision:
QUOTE
5. TERMINATION EVENTS
Failure to make any payment when due with respect to any Note,
whether of principal, interest, default interest, costs and expenses
of collection or of any and all other amounts due in connection
therewith, is a failure or event of the nature referred to in Clause
21.1.1 (7) and Clause 21.1.1 (8) of the Agreement.
UNQUOTE
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 5-3
<Page>
4. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
5. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
AM No. 5-4
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
----------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
----------------------------
Date:
----------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------
Its: VP & Treasurer
-------------------------
Date: 11/7/00
-------------------------
AM No. 5-5
<Page>
Amendment No. 6
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 6 (hereinafter referred to as the "Amendment") is entered
into as of November 20, 2000, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York, 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), which,
together with all Exhibits, Appendixes and Letter Agreements attached thereto
and as amended by Amendment No. 1, dated as of September 30, 1999, Amendment No.
2, dated as of March 13, 2000, Amendment No. 3, dated as of March 29, 2000,
Amendment No. 4, dated as of September 29, 2000 and Amendment No. 5 dated as of
November 07, 2000, is hereinafter called the "Agreement".
WHEREAS, the Seller and the Buyer have agreed to amend Clause 9 of the
Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
AM No. 6-1
<Page>
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. DELIVERY SCHEDULE
2.1 The Buyer and the Seller agree to [****].
2.2 As a consequence of Paragraph 2.1 above, the delivery schedule set forth
in Clause 9.1.1 of the Agreement is hereby canceled and replaced by the
following quoted provisions:
QUOTE
<Table>
<Caption>
CAC ID NR AIRCRAFT DELIVERY
<S> <C> <C> <C>
41 199 Firm Aircraft No 1 [****] 2000
41 200 Firm Aircraft No 2 [****] 2000
41 203 Firm Aircraft No 3 [****] 2000
41 201 Firm Aircraft No 4 [****] 2000
41 202 Firm Aircraft No 5 [****] 2000
41 204 Firm Aircraft No 6 [****] 2000
41 205 Firm Aircraft No 7 [****] 2001
41 206 Firm Aircraft No 8 [****] 2001
41 210 Firm Aircraft No 9 [****] 2001
41 207 Firm Aircraft No 10 [****] 2001
41 208 Firm Aircraft No 11 [****] 2001
41 209 Firm Aircraft No 12 [****] 2001
41 210 Firm Aircraft No 13 [****] 2001
41 211 Firm Aircraft No 14 [****] 2002
41 212 Firm Aircraft No 15 [****] 2002
41 218 Firm Aircraft No 16 [****] 2002
41 224 Firmly Ordered Option Aircraft No 17 [****] 2002
41 225 Firmly Ordered Option Aircraft No 18 [****] 2002
41 213 Firm Aircraft No 19 [****] 2002
41 214 Firm Aircraft No 20 [****] 2002
41 215 Firm Aircraft No 21 [****] 2002
41 216 Firm Aircraft No 22 [****] 2002
41 217 Firm Aircraft No 23 [****] 2002
41 219 Firm Aircraft No 24 [****] 2003
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 6-2
<Page>
<Table>
<S> <C> <C> <C>
41 220 Firm Aircraft No 25 [****] 2003
41 221 Firm Aircraft No 26 [****] 2003
41 222 Firm Aircraft No 27 [****] 2003
41 223 Firm Aircraft No 28 [****] 2003
41 226 Firmly Ordered Option Aircraft No 29 [****] 2004
41 245 Firmly Ordered Option Aircraft No 30 [****] 2004
41 246 Firmly Ordered Option Aircraft No 31 [****] 2004
41 247 Firmly Ordered Option Aircraft No 32 [****] 2004
41 248 Firmly Ordered Option Aircraft No 33 [****] 2004
41 227 Option Aircraft No 34 [****] 2003
41 229 Option Aircraft No 35 [****] 2003
41 230 Option Aircraft No 36 [****] 2003
41 231 Option Aircraft No 37 [****] 2003
41 232 Option Aircraft No 38 [****] 2004
41 233 Option Aircraft No 39 [****] 2004
41 234 Option Aircraft No 40 [****] 2004
41 235 Option Aircraft No 41 [****] 2004
41 236 Option Aircraft No 42 [****] 2004
41 237 Option Aircraft No 43 [****] 2005
41 238 Option Aircraft No 44 [****] 2005
41 239 Option Aircraft No 45 [****] 2005
41 240 Option Aircraft No 46 [****] 2005
41 241 Option Aircraft No 47 [****] 2005
41 242 Option Aircraft No 48 [****] 2005
41 243 Option Aircraft No 49 [****] 2005
41 244 Option Aircraft No 50 [****] 2005
69 719 A320 Additional Option Aircraft No 51 [****] 2005
69 720 A320 Additional Option Aircraft No 52 [****] 2005
69 721 A320 Additional Option Aircraft No 53 [****] 2006
69 722 A320 Additional Option Aircraft No 54 [****] 2006
69 723 A320 Additional Option Aircraft No 55 [****] 2006
69 724 A320 Additional Option Aircraft No 56 [****] 2006
69 725 A320 Additional Option Aircraft No 57 [****] 2006
</Table>
UNQUOTE
3. PREDELIVERY PAYMENTS
As a result of the rescheduling set forth in Paragraph 2.1, the Buyer will
make to the Seller on signature of this Amendment all Predelivery Payments
then due.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 6-3
<Page>
4. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
5. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
AM No. 6-4
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
------------------------
Date: November 20, 2000
------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T. E. Anderson
-------------------------
Thomas E. Anderson
Its: VICE PRESIDENT
-------------------------
Date: November 20, 2000
-------------------------
AM No. 6-5
<Page>
Amendment No. 7
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA. S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 7 (hereinafter referred to as the "Amendment") is entered
into as of January 25th, 2001, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United states of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement. dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), including
twenty-five option aircraft (the "Option Aircraft"), which, together with all
Exhibits, Appendixes and Letter Agreements attached thereto and as amended by
Amendment No. 1, dated as of September 30,1999, Amendment No. 2, dated as of
March 13, 2000, Amendment No. 3, dated as of March 29, 2000, Amendment No. 4,
dated as of September 29, 2000, Amendment No. 5 dated as of November 07, 2000,
and Amendment No. 6 dated as of November 20, 2000, is hereinafter called the
"Agreement."
WHEREAS, the Buyer desires to exercise its option to firmly order certain Option
Aircraft.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
AM No. 7-1
<Page>
2. DELIVERY SCHEDULE
2.1 The Buyer hereby exercises its option under Paragraph. 2.1 of Letter
Agreement No. 4 to the Agreement to firmly order Option Aircraft No. 34
(the "Firmly Ordered Option Aircraft"). The Buyer and the Seller agree to
[****].
2.2 In accordance with Paragraph 3.1 of Letter Agreement No. 4 to the
Agreement, as a consequence of the Buyer's exercising its option to firmly
order one (1) Option Aircraft, the Seller offers the Buyer delivery
position for one (1) A320 Additional Option Aircraft.
2.3 As a consequence of Paragraphs 2.1 and 2.2 above, the delivery schedule
set forth in Clause 9.1.1 of the Agreement is hereby canceled and replaced
by the following quoted provisions:
QUOTE
<Table>
<Caption>
CAC ID NR AIRCRAFT DELIVERY
<S> <C> <C> <C>
41 199 Firm Aircraft No 1 [****] 2000
41 200 Firm Aircraft No 2 [****] 2000
41 203 Firm Aircraft No 3 [****] 2000
41 201 Firm Aircraft No 4 [****] 2000
41 202 Firm Aircraft No 5 [****] 2000
41 204 Firm Aircraft No 6 [****] 2000
41 205 Firm Aircraft No 7 [****] 2001
41 206 Firm Aircraft No 8 [****] 2001
41 210 Firm Aircraft No 9 [****] 2001
41 207 Firm Aircraft No 10 [****] 2001
41 208 Firm Aircraft No 11 [****] 2001
41 209 Firm Aircraft No 12 [****] 2001
41 228 Firmly Ordered Option Aircraft No 13 [****] 2001
41 211 Firm Aircraft No 14 [****] 2002
41 212 Firm Aircraft No 15 [****] 2002
41 218 Firm Aircraft NO 16 [****] 2002
41 224 Firmly Ordered Option Aircraft No 17 [****] 2002
41 225 Firmly Ordered Option Aircraft No 18 [****] 2002
41 213 Firm Aircraft No 19 [****] 2002
41 214 Firm Aircraft No 20 [****] 2002
41 215 Firm Aircraft No 21 [****] 2002
41 216 Firm Aircraft No 22 [****] 2002
41 217 Firm Aircraft No 23 [****] 2002
41 219 Firm Aircraft No 24 [****] 2003
41 220 Firm Aircraft No 25 [****] 2003
41 221 Firm Aircraft No 26 [****] 2003
41 222 Firm Aircraft No 27 [****] 2003
41 223 Firm Aircraft No 28 [****] 2003
41 226 Firmly Ordered Option Aircraft No 29 [****] 2004
41 245 Firmly Ordered Option Aircraft No 30 [****] 2004
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 7-2
<Page>
<Table>
<S> <C> <C> <C>
41 246 Firmly Ordered Option Aircraft No 31 [****] 2004
41 247 Firmly Ordered Option Aircraft No 32 [****] 2004
41 248 Firmly Ordered Option Aircraft No 33 [****] 2004
41 227 Option Aircraft No 34 [****] 2003
41 229 Option Aircraft No 35 [****] 2003
41 230 Option Aircraft No 36 [****] 2003
41 231 Option Aircraft No 37 [****] 2003
41 232 Option Aircraft No 38 [****] 2004
41 233 Option Aircraft No 19 [****] 2004
41 234 Option Aircraft No 40 [****] 2004
41 235 Option Aircraft No 4l [****] 2004
41 236 Option Aircraft No 42 [****] 2004
41 237 Option Aircraft No 43 [****] 2005
41 238 Option Aircraft No 44 [****] 2005
41 239 Option Aircraft No 45 [****] 2005
41 240 Option Aircraft No 46 [****] 2005
41 241 Option Aircraft No 47 [****] 2005
41 242 Option Aircraft No 43 [****] 2005
41 243 Option Aircraft No 49 [****] 2005
41 244 Option Aircraft No 50 [****] 2005
69 719 A320 Additional Option Aircraft No 5l [****] 2005
69 720 A320 Additional Option Aircraft No 52 [****] 2005
69 721 A320 Additional Option Aircraft No 53 [****] 2006
69 722 A320 Additional Option Aircraft No 54 [****] 2006
69 723 A320 Additional Option Aircraft No 55 [****] 2006
69 724 A320 Additional Option Aircraft No 56 [****] 2006
69 725 A320 Additional Option Aircraft No 57 [****] 2006
96 459 A320 Additional Option Aircraft No 58 [****] 2006
</Table>
UNQUOTE
2.4 The Buyer has requested that the Seller [****].
3. PREDELIVERY PAYMENTS
Upon signature of this Amendment, the Buyer will make to the Seller all
the Predelivery Payments for the Firmly Ordered Option Aircraft. [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 7-3
<Page>
4. DEPOSIT
In accordance with Paragraph 3 of Letter Agreement No. 4 to the Agreement,
within thirty (30) days of signature of this Amendment, the Buyer will
make a nonrefundable deposit of US$ [****] (US dollars---[****]) in
respect of the A320 Additional Option Aircraft No. 58. The Buyer's
payment of this deposit will constitute acceptance of the delivery
position for this A320 Additional Option Aircraft.
5. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent extent provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
6. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
7. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Agreement,
this Amendment will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 7 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 7-4
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
------------------------
Date: January 25, 2001
------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T. E. Anderson
-------------------------
Its: VICE PRESIDENT
-------------------------
Date: January 18, 2001
-------------------------
AM No. 7-5
<Page>
Amendment No. 8
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA. S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 8 (hereinafter referred to as the "Amendment") is entered
into as of May 3, 2001, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), including
twenty-five option aircraft (the "Option Aircraft), which, together with all
Exhibits, Appendixes and Letter Agreements attached thereto and as amended by
Amendment No. 1, dated as of September 30, 1999, Amendment No. 2, dated as of
March 13, 2000, Amendment No. 3, dated as of March 29, 2000, Amendment No. 4,
dated as of September 29, 2000, Amendment No. 5 dated as of November 7, 2000,
Amendment No. 6 dated as of November 20, 2000 and Amendment No. 7 dated as of
January 29, 2001, is hereinafter called the "Agreement."
WHEREAS the Buyer desires to order thirty (30) incremental firmly ordered
aircraft, five (5) incremental option aircraft with assigned delivery dates and
thirteen (13) incremental option aircraft without delivery dates.
AM No. 8-1
<Page>
WHEREAS the Buyer and the Seller agree to modify and supplement certain of
the terms and conditions of the Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
1. DEFINITIONS
1.1 Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
1.2 The definition of the term "Aircraft" is deleted in its entirety and
replaced by the following:
QUOTE
AIRCRAFT - any or all firmly ordered aircraft, including the Firm
Aircraft, or option aircraft, including the Option Aircraft, that have
been converted to a firm order, to be sold by the Seller and purchased by
the Buyer pursuant to this Agreement, together with all components,
equipment, parts and accessories installed in or on such aircraft and the
Propulsion Systems installed thereon on delivery.
UNQUOTE
2. DELIVERY SCHEDULE
2.1 The Seller hereby offers for sale and the Buyer hereby orders thirty (30)
incremental firmly ordered A320-200 aircraft (the "New Firm A320
Aircraft") (identified in the schedule below in Paragraph 2.4 as New Firm
A320 Aircraft Nos. 25, 29 and 30, 32 and 33 and 39 through 63). The New
Firm A320 Aircraft will be subject to the same terms and conditions as the
Option Aircraft, except as otherwise stated in this Amendment.
2.2 In consideration of the Buyer's order for the New Firm A320 Aircraft, the
Seller offers the Buyer and the Buyer hereby orders (i) five (5)
incremental A320-200 option aircraft (the "A320 Incremental Option
Aircraft") (identified in the schedule below in Paragraph 2.4 as
Incremental Option Aircraft Nos. 89 through 93) and (ii) thirteen (13)
incremental A320-200 additional option aircraft (the "A320 Incremental
Additional Option Aircraft"). The Seller will offer the Buyer a delivery
date for each A320 Incremental Additional Option Aircraft upon exercise of
each of the A320 Incremental Option Aircraft. Except as otherwise stated
in this Amendment, the A320 Incremental Option Aircraft will be subject to
the same terms and conditions as the Option Aircraft, and the A320
AM No. 8-2
<Page>
Incremental Additional Option Aircraft will be subject to the same terms
and conditions as the A320 Additional Option Aircraft.
2.3 In addition, the text preceding the delivery schedule set forth in Clause
9.1.1 of the Agreement is hereby canceled and replaced by the following
quoted provisions:
QUOTE
9.1.1 Subject to 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"). Where a year
is specified below, the Seller will notify the Buyer of the quarter
by thirty-six (36) months before the beginning of the year, and then
notify the Buyer of the Scheduled Delivery Month by thirty-six (36)
months before the beginning of the quarter.
UNQUOTE
2.4 As a consequence of Paragraphs 2.1 through 2.3 above, the delivery
schedule set forth in Clause 9.1.1 of the Agreement is hereby canceled and
replaced by the following quoted provisions:
QUOTE
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 199 No. 1 Firm Aircraft [****] 2000
41 200 No. 2 Firm Aircraft [****] 2000
41 203 No. 3 Firm Aircraft [****] 2000
41 201 No. 4 Firm Aircraft [****] 2000
41 202 No. 5 Firm Aircraft [****] 2000
41 204 No. 6 Firm Aircraft [****] 2000
41 205 No. 7 Firm Aircraft [****] 2001
41 206 No. 8 Firm Aircraft [****] 2001
41 210 No. 9 Firm Aircraft [****] 2001
41 207 No. 10 Firm Aircraft [****] 2001
41 208 No. 11 Firm Aircraft [****] 2001
41 209 No. 12 Firm Aircraft [****] 2001
41 228 No. 13 Firmly Ordered Option Aircraft [****] 2001
41 211 No. 14 Firm Aircraft [****] 2002
41 212 No. 15 Firm Aircraft [****] 2002
41 218 No. 16 Firm Aircraft [****] 2002
41 224 No. 17 Firmly Ordered Option Aircraft [****] 2002
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-3
<Page>
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 225 No. 18 Firmly Ordered Option Aircraft [****] 2002
41 213 No. 19 Firm Aircraft [****] 2002
41 214 No. 20 Firm Aircraft [****] 2002
41 215 No. 21 Firm Aircraft [****] 2002
41 216 No. 22 Firm Aircraft [****] 2002
41 217 No. 23 Firm Aircraft [****] 2002
41 219 No. 24 Firm Aircraft [****] 2003
104 399 No. 25 New Firm A320 Aircraft [****] 2003
41 220 No. 26 Firm Aircraft [****] 2003
41 221 No. 27 Firm Aircraft [****] 2003
41 222 No. 28 Firm Aircraft [****] 2003
104 400 No. 29 New Firm A320 Aircraft [****] 2003
104 401 No. 30 New Firm A320 Aircraft [****] 2003
41 223 No. 31 Firm Aircraft [****] 2003
104 402 No. 32 New Firm A320 Aircraft [****] 2003
104 403 No. 33 New Firm A320 Aircraft [****] 2003
41 226 No. 34 Firmly Ordered Option Aircraft [****] 2004
41 245 No. 35 Firmly Ordered Option Aircraft [****] 2004
41 246 No. 36 Firmly Ordered Option Aircraft [****] 2004
41 247 No. 37 Firmly Ordered Option Aircraft [****] 2004
41 248 No. 38 Firmly Ordered Option Aircraft [****] 2004
104 404 No. 39 New Firm A320 Aircraft [****] 2004
104 405 No. 40 New Firm A320 Aircraft. [****] 2004
104 406 No. 41 New Firm A320 Aircraft [****] 2004
104 407 No. 42 New Firm A320 Aircraft [****] 2004
104 408 No. 43 New Firm A320 Aircraft [****] 2004
104 409 No. 44 New Firm A320 Aircraft [****] 2005
104 410 No. 45 New Firm A320 Aircraft [****] 2005
104 411 No. 46 New Firm A320 Aircraft [****] 2005
104 412 No. 47 New Firm A320 Aircraft [****] 2005
104 413 No. 48 New Firm A320 Aircraft [****] 2005
104 414 No. 49 New Firm A320 Aircraft [****] 2005
104 415 No. 50 New Firm A320 Aircraft [****] 2005
104 416 No. 51 New Firm A320 Aircraft [****] 2005
104 417 No. 52 New Firm A320 Aircraft [****] 2005
104 418 No. 53 New Firm A320 Aircraft [****] 2005
104 429 No. 54 New Firm A320 AIRCRAFT [****] 2006
104 420 No. 55 New Firm A320 Aircraft [****] 2006
104 421 No. 56 New Firm A320 Aircraft [****] 2006
104 422 No. 57 New Firm A320 Aircraft [****] 2006
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-4
<Page>
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
104 423 No. 58 New Firm A320 Aircraft [****] 2006
104 424 No. 59 New Firm A320 Aircraft [****] 2007
104 425 No. 60 New Firm A320 Aircraft [****] 2007
104 426 No. 61 New Firm A320 Aircraft [****] 2007
104 427 No. 62 New Firm A320 Aircraft [****] 2007
104 428 No. 63 New Firm A320 Aircraft [****] 2007
41 227 No. 64 Option Aircraft [****] 2004
41 229 No. 65 Option Aircraft [****] 2004
41 230 No. 66 Option Aircraft [****] 2004
41 231 No. 67 Option Aircraft [****] 2004
41 232 No. 68 Option Aircraft [****] 2005
41 233 No. 69 Option Aircraft [****] 2005
41 234 No. 70 Option Aircraft [****] 2006
41 235 No. 71 Option Aircraft [****] 2006
41 236 No. 72 Option Aircraft [****] 2006
41 237 No. 73 Option Aircraft [****] 2006
41 238 No. 74 Option Aircraft [****] 2006
41 239 No. 75 Option Aircraft [****] 2006
41 240 No. 76 Option Aircraft [****] 2006
41 241 No. 77 Option Aircraft [****] 2007
41 242 No 78 Option Aircraft [****] 2007
41 243 No. 79 Option Aircraft [****] 2007
41 244 No. 80 Option Aircraft [****] 2001
69 719 No. 81 A320 Additional Option Aircraft [****] 2007
69 720 No. 82 A320 Additional Option Aircraft [****] 2007
69 721 No. 83 A320 Additional Option Aircraft [****] 2007
69 722 No. 84 A320 Additional Option Aircraft [****] 2008
69 723 No. 85 A320 Additional Option Aircraft [****] 2008
69 724 No. 86 A320 Additional Option Aircraft [****] 2008
69 725 No. 87 A320 Additional Option Aircraft [****] 2008
96 459 No. 88 A320 Additional Option Aircraft [****] 2008
104 439 No. 89 Incremental A320 Option Aircraft [****] 2008
104 440 No. 90 Incremental A320 Option Aircraft [****] 2008
104 441 No. 91 Incremental A320 Option Aircraft [****] 2008
104 442 No. 92 Incremental A320 Option Aircraft [****] 2008
104 443 No. 93 Incremental A320 Option Aircraft [****] 2008
</Table>
UNQUOTE
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-5
<Page>
3. PREDELIVERY PAYMENTS
On signature of this Amendment, the Buyer will pay the Seller the
Predelivery Payment identified as a "1st Payment" under Clause 5.2.3 of
the Agreement for the New Firm A320 Aircraft bearing Rank No. 25 (in the
schedule above in Paragraph 2.4). This New Firm A320 Aircraft is scheduled
for delivery in a calendar quarter that begins [****] or fewer months from
the date of signature of this Amendment.
4. DEPOSIT
On signature of this Amendment, the Buyer will pay the Seller a
nonrefundable deposit of
(i) US$ [****] (US dollars--[****]) for each of the twenty-nine (29)
New Firm A320 Aircraft bearing Rank Nos. 29, 30, 32, 33 and 39
through 63 (in the schedule above in Paragraph 2.4); and
(ii) US$ [****] (US dollars--[****]) for each of the Incremental A320
Option Aircraft bearing Rank Nos. 89 through 93 (in the schedule
above in Paragraph 2.4).
5. ADDITIONAL PURCHASE INCENTIVES
5.1 In consideration of the Buyer's order for the New Firm A320 Aircraft, in
respect of each New Firm A320 Aircraft the Seller will provide the Buyer
with:
(i) An airframe credit of [****] (US dollars--[****]) (the "New Firm
A320 Aircraft Airframe Credit Memorandum").
The New Firm A320 Aircraft Airframe Credit Memorandum is quoted at
January 1999 delivery conditions and is subject to escalation in
accordance with the Airframe Price Revision Formula. Each New Firm
A320 Aircraft Airframe Credit Memorandum will be available at
delivery of the applicable Aircraft. At the Buyer's option, each New
Firm A320 Aircraft Airframe Credit Memorandum will be (i) applied by
the Seller against the Final Contract Price of the applicable
Aircraft or (ii) applied by the Buyer against the purchase of
product support related goods and services from the Seller or its
Affiliates.
(ii) [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-6
<Page>
5.2 In addition, in respect of each Option Aircraft, A320 Additional Option
Aircraft and Incremental A320 Option Aircraft bearing Rank Nos. 64 through
93 (in the schedule above in Paragraph 2.4) that is delivered as an
A320-200 aircraft, the Seller will provide the Buyer with:
(i) [****]
(ii) [****]
5.3 Finally, the Seller will provide the Buyer with:
(i) [****]
(ii) [****]
(iii) A credit of [****] (US dollars--[****]) [****]
(iv) A credit equal to [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-7
<Page>
[****]
(v) Notwithstanding the terms of [****]
(vi) The Seller will discuss with the Buyer, [****]
(vii) [****]
6. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
7. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
8. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Agreement,
this Amendment will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 8 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 8-8
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
-----------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
----------------------------
Date: May 3, 2001
---------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ Thomas E. Anderson
----------------------
Its: VICE PRESIDENT
---------------------
Date: May 3, 2001
--------------------
AM No. 8-9
<Page>
Amendment No. 9
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 9 (hereinafter referred to as the "Amendment") is entered
into as of July 18, 2001, 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 JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), including
twenty-five option aircraft (the "Option Aircraft"), which, together with all
Exhibits, Appendixes and Letter Agreements attached thereto and as amended by
Amendment No. 1, dated as of September 30, 1999, Amendment No. 2; dated as of
March 13, 2000, Amendment No. 3, dated as of March 29, 2000, Amendment No. 4,
dated as of September 29, 2000, Amendment No. 5 dated as of November 7, 2000,
Amendment No. 6 dated as of November 20, 2000, Amendment No. 7 dated as of
January 29 2001 and Amendment No. 8 dated as of May 3, 2001, is hereinafter
called the "Agreement."
WHEREAS the Buyer desires to exercise its option to firmly order an Option
Aircraft
AM No. 9-1
<Page>
NOW, THEREFORE, IT IS AGREED AS FOLLOWS
1. DEFINITIONS
1.1 Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. DELIVERY SCHEDULE
2.1 The Buyer hereby exercises its option under Paragraph 2.1 of Letter
Agreement No. 4 to the Agreement to firmly order Option Aircraft No. 64
(the "New Firmly Ordered Option Aircraft"). The Buyer and the Seller agree
to advance its delivery date from January 2004 to May 2002 and to renumber
the Aircraft chronologically.
2.2 In accordance with Paragraph 3.1 of Letter Agreement No. 4 to the
Agreement, as a consequence of the Buyer's exercising its option to firmly
order one (1) Option Aircraft, the Seller offers the Buyer a delivery
position for one (1) A320 Additional Option Aircraft at the original date
of the Option Aircraft.
2.3 As a consequence of Paragraphs 2.1 and 2.2 above, the delivery schedule
set forth in Clause 9.1.1 of the Agreement is hereby canceled and
replaced by the following quoted provisions:
QUOTE
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 199 No. 1 Firm Aircraft [****] 2000
41 200 No. 2 Firm Aircraft [****] 2000
41 203 No. 3 Firm Aircraft [****] 2000
41 201 No. 4 Firm Aircraft [****] 2000
41 202 No. 5 Firm Aircraft [****] 2000
41 204 No. 6 Firm Aircraft [****] 2000
41 205 No. 7 Firm Aircraft [****] 2001
41 206 No. 8 Firm Aircraft [****] 2001
41 210 No. 9 Firm Aircraft [****] 2001
41 207 No. 10 Firm Aircraft [****] 2001
41 208 No. 11 Firm Aircraft [****] 2001
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 9-2
<Page>
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 209 No. 12 Firm Aircraft [****] 2001
41 228 No. 13 Firmly Ordered Option Aircraft [****] 2001
41 211 No. 14 Firm Aircraft [****] 2002
41 212 No. 15 Firm Aircraft [****] 2002
41 218 No. 16 Firm Aircraft [****] 2002
41 224 No. 17 Firmly Ordered Option Aircraft [****] 2002
41 227 No. 18 New Firmly Ordered Option Aircraft [****] 2002
41 225 No. 19 Firmly Ordered Option Aircraft [****] 2002
41 213 No. 20 Firm Aircraft [****] 2002
41 214 No. 21 Firm Aircraft [****] 2002
41 215 No. 22 Firm Aircraft [****] 2002
41 216 No. 23 Firm Aircraft [****] 2002
41 217 No. 24 Firm Aircraft [****] 2002
41 219 No. 25 Firm Aircraft [****] 2003
104 399 No. 26 New Firm A320 Aircraft [****] 2003
41 220 No. 27 Firm Aircraft [****] 2003
41 221 No. 28 Firm Aircraft [****] 2003
41 222 No. 29 Firm Aircraft [****] 2003
104 400 No. 30 New Firm A320 Aircraft [****] 2003
104 401 No. 31 New Firm A320 Aircraft [****] 2003
41 223 No. 32 Firm Aircraft [****] 2003
104 402 No. 33 New Firm A320 Aircraft [****] 2003
104 403 No. 34 New Firm A320 Aircraft [****] 2003
41 226 No. 35 Firmly Ordered Option Aircraft [****] 2004
41 245 No. 36 Firmly Ordered Option Aircraft [****] 2004
41 246 No. 37 Firmly Ordered Option Aircraft [****] 2004
41 247 No. 38 Firmly Ordered Option Aircraft [****] 2004
41 248 No. 39 Firmly Ordered Option Aircraft [****] 2004
104 404 No. 40 New Firm A320 Aircraft [****] 2004
104 405 No. 41 New Firm A320 Aircraft [****] 2004
104 406 No. 42 New Firm A320 Aircraft [****] 2004
104 407 No. 43 New Firm A320 Aircraft [****] 2004
104 408 No. 44 New Firm A320 Aircraft [****] 2004
104 409 No. 45 New Firm A320 Aircraft [****] 2005
104 410 No. 46 New Firm A320 Aircraft [****] 2005
104 411 No. 47 New Firm A320 Aircraft [****] 2005
104 412 No. 48 New Firm A320 Aircraft [****] 2005
104 413 No. 49 New Firm A320 Aircraft [****] 2005
104 414 No. 50 New Firm A320 Aircraft [****] 2005
104 415 No. 51 New Firm A320 Aircraft [****] 2005
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 9-3
<Page>
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
104 416 No. 52 New Firm A320 Aircraft [****] 2005
104 417 No. 53 New Firm A320 Aircraft [****] 2005
104 418 No. 54 New Firm A320 Aircraft [****] 2005
104 419 No. 55 New Firm A320 Aircraft [****] 2006
104 420 No. 56 New Firm A320 Aircraft [****] 2006
104 421 No. 57 New Firm A320 Aircraft [****] 2006
104 422 No. 58 New Firm A320 Aircraft [****] 2006
104 423 No. 59 New Firm A320 Aircraft [****] 2006
104 424 No. 60 New Firm A320 Aircraft [****] 2007
104 425 No. 61 New Firm A320 Aircraft [****] 2007
104 426 No. 62 New Firm A320 Aircraft [****] 2007
104 427 No. 63 New Firm A320 Aircraft [****] 2007
104 428 No. 64 New Firm A320 Aircraft [****] 2007
TBD No. 65 A320 Additional Option Aircraft [****] 2004
41 229 No. 66 Option Aircraft [****] 2004
41 230 No. 67 Option Aircraft [****] 2004
41 231 No. 68 Option Aircraft [****] 2004
41 232 No. 69 Option Aircraft [****] 2005
41 233 No. 70 Option Aircraft [****] 2005
41 234 No. 71 Option Aircraft [****] 2006
41 235 No. 72 Option Aircraft [****] 2006
41 236 No. 73 Option Aircraft [****] 2006
41 237 No. 74 Option Aircraft [****] 2006
41 238 No. 75 Option Aircraft [****] 2006
41 239 No. 76 Option Aircraft [****] 2006
41 240 No. 77 Option Aircraft [****] 2006
41 241 No. 78 Option Aircraft [****] 2007
41 242 No. 79 Option Aircraft [****] 2007
41 243 No. 80 Option Aircraft [****] 2007
41 244 No. 81 Option Aircraft [****] 2007
69 719 No. 82 A320 Additional Option Aircraft [****] 2007
69 720 No. 83 A320 Additional Option Aircraft [****] 2007
69 721 No. 84 A320 Additional Option Aircraft [****] 2007
69 722 No. 85 A320 Additional Option Aircraft [****] 2008
69 723 No. 86 A320 Additional Option Aircraft [****] 2008
69 724 No. 87 A320 Additional Option Aircraft [****] 2008
69 725 No. 88 A320 Additional Option Aircraft [****] 2008
96 459 No. 89 A320 Additional Option Aircraft [****] 2008
104 439 No. 90 Incremental A320 Option Aircraft [****] 2008
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 9-4
<Page>
<Table>
<Caption>
Cac Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
104 440 No. 91 Incremental A320 Option Aircraft [****] 2008
104 441 No. 92 Incremental A320 Option Aircraft [****] 2008
104 442 No. 93 Incremental A320 Option Aircraft [****] 2008
104 443 No. 94 Incremental A320 Option Aircraft [****] 2008
</Table>
UNQUOTE
3. PREDELIVERY PAYMENTS
Upon signature of this Amendment, the Seller will allocate, as Predelivery
Payments for the Firmly Ordered Option Aircraft, the Predelivery Payments
paid by the Buyer in April 2001 for CAC Id No. 41 220 and in June 2001 for
CAC Id No. 41 221. [****]
4. DEPOSIT
In accordance with Paragraph 3 of Letter Agreement No. 4 to the Agreement,
within thirty (30) days of signature of this Amendment, the Buyer will
make a nonrefundable deposit of US$ [****] (US dollars--[****]) in
respect of the A320 Additional Option Aircraft. The Buyers payment of
this deposit will constitute acceptance of the delivery position for
this A320 Additional Option Aircraft.
5. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this Amendment
will govern.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
AM No. 9-5
<Page>
6. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
7. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Agreement,
this Amendment will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 7 will be
void and of no force or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers or agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
-----------------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
----------------------------
Date: July 18, 2001
---------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ Thomas E. Anderson
----------------------
Its: VICE PRESIDENT
---------------------
Date: July 18, 2001
--------------------
AM No. 9-6
<Page>
2 ROND POINT MAURICE BELLONTE
[GRAPHIC APPEARS HERE]---------------------------31700 BLAGNAC FRANCE
AVSA
TELEPHONE : +33/(0)5 61 30 40 12
TELECOPY : +33/(0)5 61 30 40 11
Amendment No. 10
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 10 (hereinafter referred to as the "Amendment") is entered
into as of November 6, 2001, between AVSA, S.A.R.L., a societe a responsabilite
Iimitee organized and existing under the laws of the Republic of France, having
its registered office located at 2, RondPoint Maurice Bellonte, 31700 Blagnac,
France (hereinafter referred to as the "Seller"), and JetBlue Airways
Corporation, a corporation organized and existing under the laws of the State of
Delaware, United States of America, having its principal corporate offices
located 80-02 Kew Gardens Road, 6th Floor, Kew Gardens, New York 11415 USA
(hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement, dated
as of April 20, 1999, relating to the sale by the Seller and the purchase by the
Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"), including
twenty-five option aircraft (the "Option Aircraft"), which, together with all
Exhibits, Appendixes and Letter Agreements attached thereto and as amended by
Amendment No. 1, dated as of September 30, 1999, Amendment No. 2, dated as of
March 13, 2000, Amendment No. 3, dated as of March 29, 2000, Amendment No. 4,
dated as of September 29, 2000, Amendment No. 5 dated as of November 7, 2000,
Amendment No. 6 dated as of November 20, 2000, Amendment No. 7 dated as of
January 29 2001, Amendment No. 8 dated as of May 3, 2001 and Amendment No. 9
dated as of July 18, 2001, is hereinafter called the "Purchase Agreement."
WHEREAS, the Seller and the Buyer have agreed to amend certain provisions of
the Purchase Agreement.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
1
<Page>
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Purchase Agreement. The terms "herein,"
"hereof' and "hereunder" and words of similar import refer to this Amendment
2. PREDELIVERY PAYMENT [****]
2.1 [****]
2.2 [****]
2.3 [****]
2.4 [****]
----------
[****] Represents material which has been redacted and filed
separately with the Commission pursuant to a request for confidential
treatment pursuant to Rule 406 under the Securities Act of 1933, as amended.
2
<Page>
2.5 [****]
2.6 [****]
2.7 [****]
3. CONDITIONS OF PREDELIVERY PAYMENT [****]
The right granted to the Buyer in Clause 2 hereof is subject to the
satisfaction by the Buyer of each of the following conditions precedent on or
prior to the date of such [****] as contemplated hereby:
3.1 REPRESENTATIONS AND WARRANTIES.
The Buyer represents as set forth in this Clause 3.1 on the date hereof
and also as of each [****] of Predelivery Payments, as though such
representation and warranties had been made on and as of each such date.
3.1.1 CORPORATE POWER AND AUTHORIZATION.
The execution, delivery and performance by the Buyer of this
Amendment and the Purchase Agreement as amended hereby, (a) have
been duly authorized by all requisite corporate action on the part
of the Buyer; and (b) will not violate (i) any provision of law, any
order of any court or other agency of government or the Certificate
of Incorporation, as amended, or bylaws of the Buyer or (ii) any
material indenture, agreement or other instrument to which the Buyer
is a party, or by which it or any of its property is bound, or be in
conflict with, result in a breach of, or constitute a default under,
any such material indenture, agreement or other instrument, or
result in the creation or imposition of any lien, charge or
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
3
<Page>
encumbrance of any nature whatsoever, except for the "Collateral"
(as defined in the Security Agreement dated as of April 20, 1999
between Seller and Buyer (formerly known as New Air Corporation)
(the "Security Agreement")), or upon any of the Aircraft to be
delivered under the Security Agreement. No consent of any other
party and no consent, license, approval or authorization of, or
registration or declaration with any governmental body, authority,
bureau or agency is required, or if required has been obtained, in
connection with the execution, delivery and performance by the Buyer
of this Amendment, the Purchase Agreement as amended hereby, and the
Security Agreement.
3.1.2 ASSIGNMENT OF RIGHTS,
(a) The Buyer owns the Collateral and has not granted any lien or
security interest to any third party in the Collateral
(b) The Buyer's jurisdiction of incorporation is Delaware, and the
location of the Buyer's chief executive office is Kew Gardens,
New York.
3.1.3 LITIGATION.
Except as disclosed in publicly filed documents of the Buyer, there
is no action, suit, investigation or proceeding (whether or not
purportedly on behalf of the Buyer or any of its Affiliates) pending
or to the knowledge of any senior officer of the Buyer threatened
against or affecting the Buyer or any of its Affiliates in law or in
equity or before any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, which may be reasonably expected to result in
any material adverse change in the business, operations, properties
or assets or in the condition, financial or otherwise, of the Buyer.
The Buyer is not in default with respect to any material mortgage,
bond, indenture, loan agreement, lease, guarantee or other financial
instrument. The Buyer is not in default with respect to any
judgment, writ, injunction, decree, rule or regulation of any court
or federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or
foreign, the penalty for violation of which would have a material
adverse effect on the Buyer's business, operations, properties or
assets, or on the condition, financial or otherwise, of the Buyer.
3.1.4 CITIZENSHIP.
The Buyer is a citizen of the United States as defined in 49
U.S.C. Section 1301(16).
3.1.5 SECURITY AGREEMENT.
The Security Agreement is in full force and effect and is hereby
confirmed and the Secured Obligations (as such expression is defined
thereunder) will include the obligations of Seller with respect to
the Deferred PDPs and Deferred PDP Fees.
4
<Page>
3.2 CONDITIONS PRECEDENT.
3.2.1 REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Buyer set forth in Clause
3.1 shall be true and correct on and as of such date.
3.2.2 NO DEFAULT.
There shall be no default or event or circumstance which, with
notice or lapse of time or both, would become a Termination Event
under the Purchase Agreement or an Event of Default under the
Security Agreement.
3.2.3 AMENDMENT TO A320 PROMISSORY NOTE AGREEMENT.
The Buyer will have executed an amendment to the A320 Promissory
Note Agreement dated as of April 20, 1999.
4. CREDIT MEMORANDA
The Seller and the Buyer hereby agree to modify the allocation of the
Additional Purchase Incentives described in Paragraph 5 of Amendment No. 8 to
the Purchase Agreement by not applying them to the Aircraft ranked 18, 26 and 30
but, instead, to apply them to the following Aircraft (as identified in
Amendment No. 9 to the Purchase Agreement):
<Table>
<Caption>
CAC Id No. Rank No. Delivery Date
---------- -------- -------------
<S> <C> <C>
41 208 11 [****] 2001
41 209 12 [****] 2001
41 228 13 [****] 2001
</Table>
5. REALLOCATION OF PREDELIVERY PAYMENTS
Notwithstanding any other provisions of this Amendment 10 or any other
agreements between the Buyer and the Seller, the Seller reserves the right to
reallocate, at any time, any and all cash Redelivery Payments received from
the Buyer, so as to have, with respect to each Aircraft to be delivered
during the following [****] months, a minimum cash predelivery payment amount
equivalent to [****] ([****]%) of the Predelivery Payment Reference Price
(the "[****] Percent Rule"). Should any Aircraft not comply with the [****]
Percent Rule, the Seller will inform the Buyer of the situation in writing
and request that the Buyer make a cash payment to bring the delinquent
Aircraft in line with the [****] Percent Rule. Should the Buyer fail to make
such payment within five (5) Working Days, the Seller may elect, at its sole
discretion, to reschedule the Delivery Date of such Aircraft. Seller will
promptly notify Buyer of any reallocation of Predelivery Payments.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
5
<Page>
6. AMENDMENT TO LETTER AGREEMENT NO. [****]
[****]
7. EFFECT OF THE AMENDMENT
The Purchase Agreement (including, for the avoidance of doubt, Letter
Agreement No. 5) will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and effect in
accordance with its original terms. This Amendment supersedes any previous
understandings, commitments, or representations whatsoever, whether oral or
written, related to the subject matter of this Amendment.
8. CONFIDENTIALITY
This Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Purchase Agreement.
9. GOVERNING LAW
THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
10. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Purchase
Agreement, this Amendment and the rights and obligations of the Buyer hereunder
shall not be assigned or transferred in any manner independently of the Purchase
Agreement without the prior written consent of the Seller, and any attempted
assignment or transfer in contravention of the provisions of this Clause 9 shall
be void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
6
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
in their respective officers or agents on the dates written below.
AVSA, S.A.R.L.
By: /s/ Michele LaScaux
-----------------------
Michele LASCAUX
Its: Director Contracts
----------------------
Date: November 6, 2001
---------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T.E. Anderson
----------------------
Its: Vice President
---------------------
Date: November 6, 2001
--------------------
7
<Page>
<Table>
<Caption>
EXHIBIT A
CAC Id No. Rank No. Contractual Due Date Rescheduled Due Date
---------- -------- -------------------- --------------------
<S> <C> <C> <C>
41 216 23 [****] 2001 [****] 2001
41 217 24 [****] 2001 [****] 2001
41 223 32 [****] 2001 [****] 2002
104 402 33 [****] 2001 [****] 2002
104 403 34 [****] 2001 [****] 2002
</Table>
[****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
8
<Page>
2 ROND POINT MAURICE BELLONTE
[GRAPHIC APPEARS HERE]---------------------------31700 BLAGNAC FRANCE
AVSA
TELEPHONE : +33/(0)5 61 30 40 12
TELECOPY : +33/(0)5 61 30 40 11
Amendment. No. 11
to the A320 Purchase Agreement
Dated as of April 20, 1999
between
AVSA, S.A.R.L.
and
JetBlue Airways Corporation
This Amendment No. 11 (hereinafter referred to as the "Amendment") is entered
into as of December 31, 2001, 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, RondPoint Maurice
Bellonte, 31700 Blagnac, France (hereinafter referred to as the "Seller"),
and JetBlue Airways Corporation, a corporation organized and existing under
the laws of the State of Delaware, United States of America, having its
principal corporate offices located 80-02 Kew Gardens Road, 6th Floor, Kew
Gardens, New York 11415 USA (hereinafter referred to as the "Buyer").
WITNESSETH
WHEREAS, the Buyer and the Seller entered into an A320 Purchase Agreement,
dated as of April 20, 1999, relating to the sale by the Seller and the purchase
by the Buyer of certain Airbus Industrie A320-200 aircraft (the "Aircraft"),
including twenty-five option aircraft (the "Option Aircraft"), which, together
with all Exhibits, Appendixes and Letter Agreements attached thereto and as
amended by Amendment No. 1, dated as of September 30, 1999, Amendment No. 2,
dated as of March 13, 2000, Amendment No. 3, dated as of March 29, 2000,
Amendment No. 4, dated as of September 29, 2000, Amendment No. 5 dated as of
November 7, 2000, Amendment No. 6 dated as of November 20, 2000, Amendment No. 7
dated as of January 29 2001, Amendment No. 8 dated as of May 3, 2001, Amendment
No. 9 dated as of July 13, 2001 and Amendment No. 10 dated as of November 16,
2001 is hereinafter called the "Agreement."
WHEREAS the Buyer desires to exercise its option to firmly order ten (10) option
aircraft (the "Amendment No. 11 Exercised Options")
JETBLUE-A320 -AVSA AM No. 11-1
S.A.R.L. AU CAPITAL DE 235 000 000 F-R.C.S. TOULOUSE B 330 928 672-CODE APE 514S
<Page>
NOW, THEREFORE IT TS AGREED AS FOLLOWS
1. DEFINITIONS
1.1 Capitalized terms used herein and not otherwise defined herein will have
the meanings assigned to them in the Agreement. The terms "herein,"
"hereof" and "hereunder" and words of similar import refer to this
Amendment.
2. DELIVERY SCHEDULE
2.1 The Buyer hereby exercises its option under Paragraph 2.1 of Letter
Agreement No. 4 to the Agreement to firmly order:
(i) Option Aircraft Nos. 71, 72, 73, 74 and 75, and to advance
their delivery date to respectively [****] 2002, [****]
2002, [****] 2003, [****] 2003 and [****] 2003;
(ii) A320 Additional Option Aircraft No. 65 and Option Aircraft
Nos. 66 and 67 with delivery months remaining the same (i.e.
[****] 2004, [****] 2004 and [****] 2004);
(iii) Option Aircraft Nos. 69 and 70 within the same delivery year
(i.e. in 2005).
As a result of the option exercise and the rescheduling of Aircraft, the
Buyer and the Seller agree to renumber the Aircraft chronologically.
2.2 In accordance with Paragraph 3.1 of Letter Agreement No. 4 to the
Agreement, as a consequence of the BUYER'S EXERCISING ITS option to firmly
order ten (10) Option Aircraft, the Seller offers the Buyer delivery
positions for ten (10) A320 additional option AIRCRAFT, allocated as
follows: five (5) in 2006 and five (5) in 2009 (the "Amendment No. 11
Additional Option").
2.3 The Buyer and the Seller will use best reasonable efforts to start the
Ground Checks for the delivery of Aircraft; Nos. 25 and 26 (as identified
in this Amendment) on [****], 2002 and [****], 2002 respectively.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-2
<Page>
2.4 As a consequence of Paragraphs 2.1 and 2.2 above, the delivery schedule
set forth in Clause 9.1.1 of the Agreement is hereby canceled and replaced
by the following quoted provisions:
<Table>
<Caption>
QUOTE
CAC Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 199 No. 1 Firm Aircraft [****] 2000
41 200 No. 2 Firm Aircraft [****] 2000
41 203 No. 3 Firm Aircraft [****] 2000
41 201 No. 4 Firm Aircraft [****] 2000
41 202 No. 5 Firm Aircraft [****] 2000
41 204 No. 6 Firm Aircraft [****] 2000
41 205 No. 7 Firm Aircraft [****] 2001
41 206 No. 8 Firm Aircraft [****] 2001
41 210 No. 9 Firm Aircraft [****] 2001
41 207 No. 10 Firm Aircraft [****] 2001
41 208 No. 11 Firm Aircraft [****] 2001
41 209 No. 12 Firm Aircraft [****] 2001
41 228 No. 13 Firmly Ordered Option Aircraft [****] 2001
41 211 No. 14 Firm Aircraft [****] 2002
41 212 No. 15 Firm Aircraft [****] 2002
41 218 No. 16 Firm Aircraft [****] 2002
41 224 No. 17 Firmly Ordered Option Aircraft [****] 2002
41 227 No. 18 Firmly Ordered Option Aircraft [****] 2002
41 225 No. 19 Firmly Ordered Option Aircraft [****] 2002
41 213 No. 20 Firm Aircraft [****] 2002
41 214 No. 21 Firm Aircraft [****] 2002
41 234 No. 22 Amendment No. 11 Exercised Option [****] 2002
41 215 No. 23 Firm Aircraft [****] 2002
41 216 No. 24 Firm Aircraft [****] 2002
41 217 No. 25 Firm Aircraft [****] 2002
41 235 No. 26 Amendment No. 11 Exercised Option [****] 2002
41 219 No. 27 Firm Aircraft [****] 2003
41 236 No. 28 Amendment No. 11 Exercised Option [****] 2003
104 399 No. 29 New Firm A320 Aircraft [****] 2003
41 237 No. 30 Amendment No. 11 Exercised Option [****] 2003
41 220 No. 31 Firm Aircraft [****] 2003
41 221 No. 32 Firm Aircraft [****] 2003
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A32D - AVSA AM No. 11-3
<Page>
<Table>
<Caption>
CAC Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
41 238 No. 33 Amendment No. 11 Exercised Option [****] 2003
41 222 No. 34 Firm Aircraft [****] 2003
104 400 No. 35 New Firm A320 Aircraft [****] 2003
104 401 No. 36 New Firm A320 Aircraft [****] 2003
41 223 No. 37 Firm Aircraft [****] 2003
104 402 No. 38 New Firm A320 Aircraft [****] 2003
104 403 No. 39 New Firm A320 Aircraft [****] 2003
41 226 No. 40 Firmly Ordered Option Aircraft [****] 2004
111 579 No. 41 Amendment No. 11 Exercised Option [****] 2004
41 245 No. 42 Firmly Ordered Option Aircraft [****] 2004
41 246 No. 43 Firmly Ordered Option Aircraft [****] 2004
41 229 No. 44 Amendment No. 11 Exercised Option [****] 2004
41 247 No. 45 Firmly Ordered Option Aircraft [****] 2004
41 248 No. 46 Firmly Ordered Option Aircraft [****] 2004
104 404 No. 47 New Firm A320 Aircraft [****] 2004
104 405 No. 48 New Firm A320 Aircraft [****] 2004
41 230 No. 49 Amendment No. 11 Exercised Option [****] 2004
104 406 No. 50 New Firm A320 Aircraft [****] 2004
104 407 No. 51 New Firm A320 Aircraft [****] 2004
104 408 No. 52 New Firm A320 Aircraft [****] 2004
104 409 No. 53 Nee Firm A320 Aircraft [****] 2005
41 232 No. 54 Amendment No. 11 Exercised Option [****] 2005
104 410 No. 55 New Firm A320 Aircraft [****] 2005
104 411 No. 56 New Firm A320 Aircraft [****] 2005
41 233 No. 57 Amendment No. 11 Exercised Option [****] 2005
104 412 No. 58 New Firm A320 Aircraft [****] 2005
104 413 No. 59 New Firm A320 Aircraft [****] 2005
104 414 No. 60 New Firm A320 Aircraft [****] 2005
104 415 No. 61 New Firm A320 Aircraft [****] 2005
104 416 No. 62 New Firm A320 Aircraft [****] 2005
104 417 No. 63 New Firm A320 Aircraft [****] 2005
104 418 No. 64 New Firm A320 Aircraft [****] 2005
104 419 No. 65 New Firm A320 Aircraft [****] 2006
104 420 No. 66 New Firm A320 Aircraft [****] 2006
104 421 No. 67 New Firm A320 Aircraft [****] 2006
104 422 No. 68 New Firm A320 Aircraft [****] 2006
104 423 No. 69 New Firm A320 Aircraft [****] 2006
104 424 No. 70 New Firm A320 Aircraft [****] 2007
104 425 No. 71 New Firm A320 Aircraft [****] 2007
104 426 No. 72 New Firm A320 Aircraft [****] 2007
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-4
<Page>
<Table>
<Caption>
CAC Id No. Rank No. Aircraft Delivery
---------- -------- -------- --------
<S> <C> <C> <C>
104 427 No. 73 New Firm A320 Aircraft [****] 2007
104 428 No. 74 New Firm A320 Aircraft [****] 2007
41231 No. 75 Option Aircraft [****] 2004
tbd No. 76 Amendment No. 11 Additional Option [****] 2006
tbd No. 77 Amendment No. 11 Additional Option [****] 2006
tbd No. 78 Amendment No. 11 Additional Option [****] 2006
tbd No. 79 Amendment No. 11 Additional Option [****] 2006
tbd No. 80 Amendment No. 11 Additional Option [****] 2006
41 239 No. 81 Option Aircraft [****] 2006
41 240 No. 82 Option Aircraft [****] 2006
41 241 No. 83 Option Aircraft [****] 2007
41 242 No. 84 Option Aircraft [****] 2007
41 243 No. 35 Option Aircraft [****] 2007
41 244 No. 86 Option Aircraft [****] 2007
69 719 No. 87 A32U Additional Option Aircraft [****] 2007
69 720 No. 88 A320 Additional Option Aircraft [****] 2007
69 721 No. 89 A320 Additional Option Aircraft [****] 2007
69 722 No. 90 A320 Additional Option Aircraft [****] 2008
69 723 No. 91 A320 Additional Option Aircraft [****] 2008
69 724 No. 92 A320 Additional Option Aircraft [****] 2008
69 725 No. 93 A320 Additional Option Aircraft [****] 2008
96 459 No. 94 A320 Additional Option Aircraft [****] 2008
104 439 No. 95 Incremental A320 Option Aircraft [****] 2008
104 440 No. 96 Incremental A320 Option Aircraft [****] 2008
104 441 No. 97 Incremental A320 Option Aircraft [****] 2003
104 442 No. 93 Incremental A320 Option Aircraft [****] 2008
104 143 No. 99 Incremental A320 Option Aircraft [****] 2003
tbd No. 100 Amendment No. 11 Additional Option [****] 2009
tbd No. 101 Amendment No. 11 Additional Option [****] 2009
tbd No. 102 Amendment No. 11 Additional Option [****] 2009
tbd No. 103 Amendment No. 11 Additional Option [****] 2009
tbd No. 104 Amendment No. 11 Additional Option [****] 2009
UNQUOTE
</Table>
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-5
<Page>
3. PREDELIVERY PAYMENTS
The Seller agrees that:
3.1 with respect to Amendment No. 11 Exercised Option CaC Id No. 41 234 and
41 235 due for delivery respectively in [****] 2002 and in [****]
2002, already paid Predelivery Payments [****]
[****]
3.2 With respect to Amendment No. 11 Exercised Option to be delivered in 2003
(CaC Id No. 41236, 41 237 and 41 238), the Predelivery. Payments schedule
as set forth in the Agreement will apply. Consequently, upon execution
hereof, an amount of USD [****] will be due by the Buyer to the Seller.
3.3 With respect to Amendment No. 11 Exercised Option to be delivered in 2004
(Cac Id No. 111 579 41 229 and 41 230) and 2005 (Cac. Id No. 41 232 and
41 233), the first Predelivery Payment (i.e. [****]% of the Predelivery
Payment Reference Price) [****] and the remaining [****]% Predelivery
Payments will be as set forth in the Agreement.
3.4 In addition to the above and in accordance with the attached Predelivery
Payments Schedule, upon signature of the Amendment the Buyer will notify
to the Seller in writing of his choice to [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-6
<Page>
4. DEPOSIT
In accordance with Paragraph 3 of Letter Agreement No. 4 to the Agreement,
within thirty (30) days of signature of this Amendment, the Buyer will
make a nonrefundable deposit of US$ [****] (US dollars-[****] in respect
of each of the ten (10) Amendment No. 11 Additional Options. The Buyer's
payment of this deposit WILL constitute acceptance of the delivery years
for these A320 additional option aircraft.
5. PURCHASE INCENTIVES
In consideration of the Buyer's exercise of ten (10) option aircraft, the
Seller hereby agrees to provide the Buyer with a USD [****] (United
States Dollars [****]) Credit Memorandum at delivery conditions
prevailing in January 1999. [****]
<Table>
<Caption>
CAC Id No. Delivery Date
---------- -------------
<S> <C>
41 218 [****] 2002
41 224 [****] 2002
41 225 [****] 2002
41 213 [****] 2002
41 214 [****] 2002
41 215 [****] 2002
41 216 [****] 2002
41 217 [****] 2002
</Table>
6. OTHER MATTERS
6.1 It is hereby agreed that the Seller Will make available to the Buyer free
of charge, for each Aircraft delivery, up to four (4) rental cars.
6.2 [****]
6.3 In order to address the specification and vendor requirements already
outlined by the Buyer regarding the enlarged overhead stowage bins for the
Aircraft, the Seller will
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-7
<Page>
proactively explore with the Buyer all ways in which a mutually beneficial
solution can be achieved,
6.4 [****]
7. EFFECT OF THE AMENDMENT
The Agreement will be deemed amended to the extent herein provided, and,
except as specifically amended hereby, will continue in full force and
effect in accordance with its original terms. This Amendment supersedes
any previous understandings, commitments, or representations whatsoever,
whether oral or written, related to the subject matter of this Amendment.
Both parties agree that this Amendment will constitute an integral,
nonseverable part of the Agreement and be governed by its provisions,
except that if the Agreement and this Amendment have specific provisions
that are inconsistent, the specific provisions contained in this.
Amendment will govern.
This Amendment will become effective upon execution thereof and receipt by
the Seller of the Predelivery Payments referred to in Paragraph 3 above.
8. CONFIDENTIALITY
Thus Amendment is subject to the confidentiality provisions set forth in
Clause 22.5 of the Agreement.
9. ASSIGNMENT
Notwithstanding any other provision of this Amendment or of the Agreement;
this Amendment will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 9 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
JetBlue - A320 - AVSA AM No. 11-8
<Page>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers ox agents on the dates written
below.
AVSA, S.A.R.L.
By: /s/ Francois Besnier
----------------------
FRANCOIS BESNIER
Its: AVSA CHIEF EXECUTIVE OFFICER
------------------------------
Date: January 9, 2002
-----------------------------
JETBLUE AIRWAYS CORPORATION
By: /s/ T.E. Anderson
--------------------------
Its: Vice President
-------------------------
Date: January 9, 2002
------------------------
JetBlue - A320 - AVSA AM No. 11-9
<Page>
LETTER AGREEMENT NO. 1
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-20l
Salt Lake City, UT 84121
Re: SPARE PARTS
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L, (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 1 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
LA1-1
<Page>
CONTENTS
CLAUSES
1 - GENERAL
2 - INITIAL PROVISIONING
3 - STORES
4 - DELIVERY
5 - PRICE
6 - PAYMENT PROCEDURES AND CONDITIONS
7 - TITLE
8 - PACKAGING
9 - DATA RETRIEVAL
10 - BUY-BACK
11 - WARRANTIES
12 - LEASING
13 - TERMINATION
14 - ASSIGNMENT
LA1-2
<Page>
1. GENERAL
1.1 MATERIAL
This Letter Agreement covers the terms and conditions for the services
offered by the Seller to the Buyer ("Material Support") in respect of
Aircraft spare parts itemized below in Paragraphs 1.1(a) through 1.1(f)
("Material") and is intended by the parties to be and will constitute an
agreement of conditional sale of all Material furnished to the Buyer by
the Seller pursuant hereto, except as to Material leased to the Buyer
pursuant to Clause 12 of this Letter Agreement.
The Material will comprise:
(a) Seller Parts (industrial proprietary components, equipment,
accessories or parts of the Manufacturer manufactured to the
detailed design of the Manufacturer or a subcontractor of it and
bearing official part numbers of the Manufacturer or material for
which the Seller has exclusive sales rights in the United States).
(b) Supplier Parts classified as rotable line replacement units.
(e) Supplier Parts classified as expendable line maintenance parts.
(d) Ground support equipment (GSE) and special-to-type tools.
(e) Hardware and standard material.
(f) Consumables and raw material as a package.
It is expressly understood that Seller Parts will not include parts
manufactured pursuant to a parts manufacturing authority.
Material covered under Paragraphs 1.1(e) and 1.1(f) are available only as
a package when supplied as part of the initial provisioning of Material.
1.2 SCOPE OF MATERIAL SUPPORT
1.2.1 The Material Support to be provided by the Seller under the conditions
hereunder covers the following:
(a) all Material purchased by the Buyer from the Seller during the
Initial Provisioning Period (defined below in Paragraph 2) (the
"Initial Provisioning") and all items in Paragraphs 1.1(a) through
1.1(d) for purchases additional to the Initial Provisioning, and
LA1-3
<Page>
(b) the Seller's leasing of Seller Parts to the Buyer for the Buyer's
use on its Aircraft in commercial air transport service as set forth
in Paragraph 12 of this Letter Agreement.
1.2.2 Propulsion Systems, including associated parts and spare parts therefore,
are not covered under this Letter Agreement and will be subject to direct
negotiations between the Buyer and the relevant Propulsion Systems
manufacturer(s).
1.2.3 During a period commencing on the date hereof and continuing as long as at
least five (5) aircraft of the type of the Aircraft are operated by
airlines in commercial air transport service (the "Term"), the Seller will
maintain or cause to be maintained such stock of Seller Parts as the
Seller deems reasonable and will furnish at reasonable prices Seller Parts
adequate to meet the Buyer's needs for repairs and replacements on the
Aircraft. Such Seller Parts will be sold and delivered in accordance with
Paragraphs 4 and 5 of this Letter Agreement, upon receipt of the Buyer's
orders.
The Seller will use its reasonable efforts to obtain a similar service
from all Suppliers of parts that are originally installed on the Aircraft
and not manufactured by the Seller.
1.3 Purchase Source of Material
The Buyer agrees to purchase from the Seller's designee ASCO the Seller
Parts required for the Buyer's own needs during the Term, provided that
this Paragraph 1.3 will not in any way prevent the Buyer from resorting to
the stocks of Seller Parts of other airlines operating aircraft of the
type of the Aircraft or from purchasing items equivalent to Seller Parts
from said airlines, distributors or dealers, on the condition that said
Seller Parts have been designed and manufactured by, or obtained from, the
Seller, and provided also that this Paragraph 1.3 will not prevent the
Buyer from exercising its rights under Paragraph 1.4 of this Letter
Agreement.
1.4 Manufacture of Material by the Buyer
1.4.1 The provisions of Paragraph 1.3 of this Letter Agreement notwithstanding,
the Buyer may manufacture or have manufactured for its own use or may
purchase from any other source whatsoever Seller Parts in the following
cases:
(a) after expiration of the Term, if at such time the Seller is out of
stock of a required Seller Part;
LA1-4
<Page>
(b) at any time, to the extent Seller Parts are needed to effect AOG
repairs on any Aircraft delivered under the Agreement and are not
available from the Seller within a lead time shorter than or equal
to the time in which the Buyer can provide said Seller Parts,
provided the Buyer will sell or lease such Seller Parts only if
they are assembled in an Aircraft that is sold or leased;
(c) in the event that the Seller fails to fulfill its obligations with
respect to any Seller Parts pursuant to Paragraph 1.2 above within a
reasonable period after written notice thereof from the Buyer; and
(d) when, with respect to certain Seller Parts, the Seller has granted,
under the Illustrated Parts Catalog supplied in accordance with this
Letter Agreement, the right of local manufacture of Seller Parts.
1.4.2 The rights granted to the Buyer in Paragraph 1.4.1 will not in any way be
construed as a license, nor will they in any way obligate the Buyer to pay
any license fee, royalty or obligation whatsoever, nor will they in any
way be construed to affect the rights of third parties.
1.4.3 The Seller will provide the Buyer with all technical data reasonably
necessary to manufacture Seller Parts, in the event the Buyer is entitled
to do so pursuant to Paragraph 1.4.1 of this Letter Agreement. The
proprietary rights to such technical data will be subject to the terms of
Clause 14.10.1 of the Agreement.
1.5 SPARE PARTS FIELD REPRESENTATIVE
The Seller hereby agrees to provide free of charge one (1) spare parts
field representative for up to [****] months, to assist with the initial
provisioning of Material.
1.6 LANGUAGE
1.6.1 Words and expressions used in this Letter Agreement will have the same
meanings as they do in the rest of the Agreement, unless otherwise stated
in this Letter Agreement.
1.6.2 Technical and trade items used but not defined herein or in the Agreement
will be defined as generally accepted in the aircraft manufacturing
industry.
2. INITIAL PROVISIONING
The period up to and expiring on the ninetieth (90th) day after delivery
of the last Aircraft will hereinafter be referred to as the Initial
Provisioning Period.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA1-5
<Page>
2. SELLER-SUPPLIED DATA
The Seller will prepare and supply to the Buyer the following
documents:
2.1.1 INITIAL PROVISIONING DATA
The Seller will provide the Buyer initial provisioning data provided
for in Chapter 2B of ATA 200 Revision 23 ("Initial Provisioning Data")
in a form, format and within a time period to be mutually agreed upon.
A free of charge revision service will be effected every ninety (90)
days, up to the end of the Initial Provisioning Period, or until the
configuration of the Buyer's delivered Aircraft is included.
In any event, the Seller will ensure that Initial Provisioning Data are
released to the Buyer in time to allow the necessary evaluation time by
the Buyer and the on-time delivery of ordered Material.
2.1.2 SUPPLEMENTARY DATA
The Seller will provide the Buyer with Local Manufacture Tables
(X-File), as part of the Illustrated Parts Catalog (Additional
Cross-Reference Tables), which will be a part of the Initial
Provisioning Data Package.
2.1.3 INITIAL PROVISIONING DATA FOR EXERCISED OPTIONS
2.1.3.1 All Option Aircraft converted to a firm order, pursuant to the terms
and conditions of Letter Agreement No. 4 to the Agreement, will be
included in the revision to the provisioning data that is issued after
option exercise, if such revision is not scheduled to be issued within
four (4) weeks from the date of option exercise. If the option exercise
date does not allow the Seller four (4) weeks' preparation time, the
Aircraft concerned will be included in the next scheduled revision.
2.1.3.2 The Seller will, from the date of option exercise until three (3)
months after delivery of each Aircraft, submit to the Buyer details of
particular Supplier components being installed on each Aircraft and
will recommend the quantity to order. A list of such Supplier
components will be supplied at the time of the provisioning data
revision as specified above.
2.1.3.3 The Seller will deliver to the Buyer T-files for particular
Supplier components, as applicable, in time to allow the Buyer's
planning of repair and overhaul tasks.
LA1-6
<Page>
2.1.3.4 At delivery of each Option Aircraft converted to a firm order, the data
with respect to Material will at least cover such Aircraft's technical
configuration as known six (6) months before Aircraft delivery and will
be updated to reflect the final build status of such Aircraft. Such
update will be included in the data revisions issued three (3) months
after delivery of such Aircraft.
2.2 SUPPLIER-SUPPLIED DATA
2.2.1 GENERAL
Suppliers will prepare and issue T-files in the English language for
those Supplier components for which the Buyer has elected to receive
data.
Said data (initial issue and revisions) will be transmitted to the
Buyer through the Seller. The Seller will review the compliance of such
data with relevant ATA requirements, but will not be responsible for
the substance of such data. The Seller will use its best efforts to
ensure that such data will be adequate to enable the Buyer to undertake
in-house repair and/or overhaul of such components.
In any event, the Seller will exert its reasonable efforts to supply
Initial Provisioning Data to the Buyer in time to allow the necessary
evaluations by the Buyer and on-time deliveries.
2.2.2 INITIAL PROVISIONING DMA
Initial Provisioning Data for Supplier products provided for in Chapter
2B of ATA 200 Revision 23 will be furnished as mutually agreed upon
during a Preprovisioning Meeting (defined below), with free of charge
revision service assured up to the end of the Initial Provisioning
Period, or until it reflects the configuration of the delivered
Aircraft.
2.3 PREPROVISIONING MEETING
2.3.1 The Seller will organize a meeting (i) at its Material Support Center
in Hamburg, Germany ("MSC"), (ii) at ASCO or (iii) at a place to be
mutually agreed, in order to formulate an acceptable schedule and
working procedure to accomplish the Initial Provisioning of Material
(the "Preprovisioning Meeting").
2.3.2 The date of the Preprovisioning Meeting will be mutually agreed upon.
LA1-7
<Page>
2.4 INITIAL PROVISIONING TRAINING
The Seller will furnish, at the Buyers request and at no charge, training
courses related to the Seller's provisioning documents, purchase order
administration and handling at ASCO and MSC.
2.5 INITIAL PROVISIONING CONFERENCE
The Seller will organize an Initial Provisioning conference at MSC or ASCO
that will include Supplier participation, as agreed upon during the
Preprovisioning Meeting (the "Initial Provisioning Conference"). Such
conference will take place as mutually agreed and practicable.
2.6 INITIAL PROVISIONING DATA COMPLIANCE
2.6.1 Initial Provisioning Data generated by the Seller and supplied to the
Buyer will comply with the latest configuration of the Aircraft to which
such data relate, as known three (3) months before the data are issued.
Said data will enable the Buyer to order Material conforming to its
Aircraft as required for maintenance and overhaul.
This provision will not cover parts embodying those Buyer modifications
that are unknown to the Seller, and parts embodying modifications neither
agreed to nor designed by the Seller.
2.6.2 During the Initial Provisioning Period, Material will conform with the
latest configuration standard of the affected Aircraft and with the
Initial Provisioning Data transmitted by the Seller. Should the Seller
default in this obligation, it will immediately replace such parts and/or
authorize return shipment at no transportation cost to the Buyer. The
Buyer will make reasonable efforts to minimize such cost, in particular by
using its own airfreight system for transportation at no charge to the
Seller. The Seller, in addition, will use its reasonable efforts to cause
Suppliers to provide a similar service for their items.
2.7 DELIVERY OF INITIAL PROVISIONING MATERIAL
2.7.1 To support the operation of the Aircraft, the Seller will use its
reasonable efforts to deliver Initial Provisioning Material in Paragraph
1.1(a) of this Letter Agreement against the Buyer's orders from the Seller
and according to the following schedule, provided the orders are received
by the Seller in accordance with published lead time:
Each block of Aircraft referred to in the schedule below will be defined
as five (5) Aircraft to be delivered in sequence.
LA1-8
<Page>
(a) At least fifty percent (50%) of the ordered quantity of each Line
Replacement or Line Maintenance item three (3) months before
delivery of the first Aircraft of each block of Aircraft for which
the Buyer has placed Initial Provisioning orders for Material
defined above in Paragraph 1.1(a).
(b) At least seventy-five percent (75%) of the ordered quantity of each
Line Replacement or Line Maintenance item one (1) month (for items
identified as line station items, two (2) months) before delivery of
the first Aircraft of each block of Aircraft for which the Buyer has
placed Initial Provisioning orders for Material defined above in
Paragraph 1.1(a).
(c) Fifty percent (50%) of the ordered quantity of each item except as
specified in Paragraphs 2.7.1 (a) and 2.7.1 (b) above at delivery of
the first Aircraft of each block of Aircraft for which the Buyer has
placed Initial Provisioning orders for Material defined above in
Paragraph 1.1(a).
(d) One hundred percent (100%) of the ordered quantity of each item,
including line station items, three (3) months after delivery of the
first Aircraft of each block of Aircraft for which the Buyer has
placed Initial Provisioning orders for Material, as defined above in
Paragraph 1.1(a). If said one hundred percent (100%) cannot be
accomplished, the Seller will endeavor to have such items available
at its facilities for immediate supply, in case of an AOG.
2.7.2 In the event that less than eighty-five percent (85%) of the Buyer's
orders of Initial Provisioning Material defined above in Paragraph 1.1(a),
supporting each block of Aircraft (the "IP Block"), is delivered by the
Seller to the Buyer in accordance with the provisions set forth above in
Paragraph 2.7.1(d) for reasons other than Excusable Delay as defined in
Clause 10 of the Agreement, then the Seller will provide the Buyer with a
credit equal to (i) eighty-five percent (85%) minus the actual percentage
of the IP Block delivered, up to a maximum of ten percent (10%),
multiplied by (ii) the aggregate value of the undelivered portion of the
IP Block ordered by the Buyer from the Seller in accordance with all
published lead times.
Such credit will be made available by the Seller to the Buyer upon mutual
agreement of the computation.
2.7.3 The Buyer may, subject to the Seller's agreement, cancel or modify Initial
Provisioning orders placed with the Seller with no cancellation charge as
follows:
(a) "Long Lead-Time Material" (lead time exceeding twelve (12) months)
not later than six (6) months before scheduled delivery of said
Material,
LA1-9
<Page>
(b) normal lead time Material not later than three (3) months
before scheduled delivery of said Material,
(c) Buyer-specific Material and Material in Paragraphs 1.1(b)
through 1.1(f) no later than the quoted lead time before
scheduled delivery of said Material.
2.7.4 Should the Buyer cancel or modify any orders for Material outside
the time limits defined above in Paragraph 2.7.3, the Seller will
have no liability for the cancellation or modification, and the
Buyer will reimburse the Seller for any direct cost incurred in
connection therewith.
3. STORES
3.1 ASCO SPARES CENTER
The Seller has established and will maintain or cause to be
maintained, as long as at least five (5) aircraft of the type of the
Aircraft are operated by US airlines in commercial air transport
service (the "US Term"), a US store adjacent to Dulles International
Airport, known as the ASCO Spares Center, located in Ashburn,
Virginia ("ASCO Spares Center"). The ASCO Spares Center will be
operated twenty-four (24) hours/day, seven (7) days/week, all year
for the handling of AOG and critical orders for Seller Parts.
3.2 MATERIAL SUPPORT CENTER, GERMANY
The Manufacturer has set up and will maintain or cause to be
maintained during the Term a store of Seller Parts at MSC. MSC will
be operated twenty-four (24) hours/day, seven (7) days/week, all
year.
3.3 OTHER POINTS OF SHIPMENT
The Seller reserves the right to effect deliveries from distribution
centers other than the ASCO Spares Center or MSC and from any of the
production facilities of the Associated Contractors.
4. DELIVERY
4.1 GENERAL
The Buyer's purchase orders will be administered in accordance with
ATA Specification 2000.
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The provisions of this Paragraph 4 do not apply to Initial Provisioning
Data and Material.
4.2 LEAD TIMES
4.2.1 In general, the lead times are (and, unless otherwise agreed, will at all
times be) in accordance with the definition in the "World Airline and
Suppliers Guide" (latest edition).
4.2.2 Material will be dispatched within the lead times quoted in the published
Seller's price catalog for Material described in Paragraph 1.1(a), and
within the Supplier's or supplier's lead time augmented by the Seller's
own order and delivery processing time (such in-house processing time not
to exceed fifteen (15) days) for Material described in Paragraphs 1.1(b)
through 1.l(d).
4.2.3 Expedite Service
The Seller operates a twenty-four (24) hour-a-day, seven (7) day-a-week
expedite service to supply the relevant Seller Parts available in the
Seller's stock, workshops and assembly line, including high-cost
long-lead-time items, to the international airport nearest the location of
such items (the "Expedite Service").
The Expedite Service is operated in accordance with the "World Airline and
Suppliers Guide." Accordingly, the Seller will notify the Buyer of the
action taken to effect the Expedite Service as follows:
(a) four (4) hours after receipt of an AOG order,
(b) twenty-four (24) hours after receipt of a critical order (imminent
AOG or work stoppage),
(e) seven (7) days after receipt of an expedite order from the Buyer.
The Seller and its subcontractors will deliver Seller Parts requested on
expedite basis against normal orders previously placed by the Buyer or
upon requests by telephone or telex by the Buyer's representatives, such
requests to be confirmed by the Buyer's subsequent order for such Seller
Parts within a reasonable time.
4.3 DELIVERY STATUS
The Seller agrees to report to the Buyer the status of supplies against
orders on a monthly basis or on a mutually agreed timeframe.
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4.4 EXCUSABLE DELAY
Clause 10.1 of the Agreement will apply to this Letter Agreement.
4.5 SHORTAGES, OVERSHIPMENTS, NONCONFORMANCE IN ORDERS
4.5.1 Within thirty (30) days after receipt of Material delivered pursuant to a
purchase order, the Buyer will advise the Seller of any alleged shortages
or overshipments with respect to such order and of all nonconformance to
specification of parts in such order inspected by the Buyer.
In the event that the Buyer has not reported such alleged shortages,
overshipments or nonconformance within the above defined period, the Buyer
will be deemed to have accepted the deliveries.
4.5.2 In the event that the Buyer reports overshipments or nonconformance to the
specifications within the period defined above in Paragraph 4.5.1, then,
if the Seller accepts such reports, the Seller will either replace the
Material concerned or credit the Buyer for Material returned. In such
case, transportation charges will be borne by the Seller.
The Buyer will endeavor to minimize such costs, particularly by using its
own airfreight system for transportation at no charge to the Seller.
4.6 CESSATION OF DELIVERIES
The Seller reserves the right to stop or otherwise suspend deliveries if
the Buyer fails to meet its obligations under Paragraphs 6 and 7 of this
Letter Agreement.
5. PRICE
5.1 The Material Prices will be:
5.1.1 FCA the ASCO Spares Center for deliveries from the ASCO Spares Center.
5.1.2 FCA any place specified by the Seller for deliveries from other Seller or
Supplier facilities.
5.2 VALIDITY OF PRICES
5.2.1 The prices are the Seller's published prices in effect on the date of
receipt of the order (subject to reasonable quantities and delivery time)
and will be exclusively expressed in US dollars. Payment will be made by
the Buyer to the Seller in US dollars as set forth below in Paragraph 6.1.
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5.2.2 Prices of Seller Parts will be in accordance with the then current
Seller's Spare Parts Price List. Prices will be firm for each calendar
year. The Seller, however, reserves the right to revise the prices of
Seller Parts during the course of the calendar year in the following
cases:
(i) significant revision in manufacturing costs,
(ii) a significant revision in Manufacturer's purchase price of materials
(including significant variation of exchange rates),
(iii) significant error in estimation of expression of any price.
5.2.3 Prices of Material as defined above in Paragraphs 1.1(b) through 1.1(d)
will be the valid list prices of the Supplier or supplier augmented by the
Seller's handling charge. The percentage of the handling charge will vary
with the Material's value and will be determined item by item.
5.2.4 The Seller warrants that, should the Buyer purchase from the Seller one
hundred percent (100%) of the recommended Initial Provisioning of Material
defined above in Paragraphs 1.1(b) through 1.1(d), the average handling
charge on the total package will not exceed fifteen percent (15%). This
average handling charge will be increased to eighteen percent (18%) in the
event that all orders have not been placed nine (9) months prior to
delivery of the first Aircraft.
5.2.5 Prices of Material as defined above in Paragraphs 1.1(e) and 1.1(f) will
be the Seller's purchase prices augmented by a variable percentage of
handling charge.
6. PAYMENT PROCEDURES AND CONDITIONS
6.1 MEANS OF PAYMENT
Payment will be made in immediately available funds in US dollars.
6.2 TIME OF PAYMENT
Payment will be made by the Buyer to the Seller within thirty (30) days
from the date of invoice.
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6.3 BANK ACCOUNTS
The Buyer will make all payments hereunder in full without setoff,
counterclaim, deduction or withholding of any kind to the accounts listed
below, unless otherwise directed by the Seller:
(a) For wire transfer, in favor of Airbus Service Company:
[****]
(h) For direct deposit (lockbox), in favor of Airbus Service Company:
[****]
6.4 TAXES
All payments due the Seller hereunder will be made in full without setoff
or counterclaim and without deduction or withholding of any kind.
Consequently, the Buyer will assure that the sums received by the Seller
under this Letter 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, dues or charges of
whatever nature except that if the Buyer is compelled by law to make any
such deduction or withholding the Buyer will pay such additional amounts
as may be necessary in order 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.
6.5 If any payment due the Seller is not received in accordance with the time
period provided above in Paragraph 6.2, the Seller will have the right to
claim from the Buyer and the Buyer will promptly pay to the Seller
interest on the unpaid amount at a rate equal to one and one-half percent
(1.5%) per month to be calculated from (and including) the due date to
(but excluding) the date payment is received by the Seller. The Seller's
claim to such interest will not prejudice any other rights the Seller may
have under this Letter Agreement.
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[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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6.6 CREDIT ASSURANCE
The Seller and the Buyer agree that the Seller has the right to request
and the Buyer will upon such request provide the Seller with sufficient
financial means in due time in order to assure the Seller of full payment
of the Buyer's current and/or expected payment obligations.
6.6.1 The Seller's right to request credit assurance from the Buyer will be
limited to the following case:
(i) The Seller has received purchase orders from the Buyer for Initial
Provisioning Material, and
(ii) the Seller has received purchase and/or service orders exceeding the
Buyer's average two (2) month's turnover with the Seller, and
(iii) the Buyer is indebted to the Seller for overdue invoices.
6.6.2 The Seller will accept any one of the following financial means as credit
assurance:
(i) Irrevocable and confirmed letter of credit, raised by banks of
international standing and reputation. The conditions of such letter
of credit will be pertinent to Aircraft support activities and will
be set forth by the Seller.
(ii) Bank guarantee raised by banks of international standing and
reputation. The conditions of such bank guarantee will be mutually
agreed upon prior to acceptance by the Seller.
(iii) Stand-by letter of credit raised by banks of international standing
and reputation. The conditions of such letter of credit will be
mutually agreed upon prior to acceptance by the Seller.
7. TITLE
Title to any Material purchased under this Letter Agreement will remain
with the Seller until full payment of the invoices and any interest
thereon has been received by the Seller.
The Buyer will undertake that Material to which title has not passed to
the Buyer will be kept free from any debenture, mortgage or any similar
charge or claim in favor of any third party.
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8. PACKAGING
All material will be packaged in accordance with ATA 300 specification,
Category III for consumable/expendable Material and Category II for
rotables. Category I containers will be used if requested by the Buyer
and the difference between Category I and Category II packaging costs
will be paid by the Buyer together with payment for the respective
Material.
9. DATA RETRIEVAL
The Buyer undertakes to provide periodically to the Seller, as the
Seller may reasonably request, during the Term, a quantitative list of
the parts used for maintenance and overhaul of the Aircraft. The range
and contents of this list will be established by mutual agreement
between the Seller and the Buyer.
10. BUY-BACK
10.1 BUY-BACK OF OBSOLETE MATERIAL
The Seller agrees to buy back unused Seller Parts that may become
obsolete before delivery of the first Aircraft to the Buyer as a result
of mandatory modifications required by the Buyer's or Seller's
airworthiness authorities, subject to the following:
(a) the Seller Parts involved will be those which the Seller directs
the Buyer to scrap or dispose of and which cannot be reworked or
repaired to satisfy the revised standard;
(b) the Seller will grant the Buyer a credit equal to the purchase
price paid by the Buyer for any such obsolete parts, such credit
being limited to quantities ordered in the Initial Provisioning
recommendation;
(c) the Seller will use its reasonable efforts to obtain for the Buyer
the same protection from Suppliers.
10.2 BUY-BACK OF SURPLUS MATERIAL
10.2.1 The Seller agrees that at any time after one (1) year and within three
(3) years after delivery of the first Aircraft to the Buyer, the Buyer
will have the right to return to the Seller, at a credit of one hundred
percent (100%) of the original purchase price paid by the Buyer, unused
and undamaged Material set forth above in Paragraphs 1.1(a) and 1.1(b)
originally purchased from the Seller under the terms hereof, provided
(i) that the selected protection level does not exceed ninety-six
percent
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(96%) with a turnaround time of forty-five (45) days, (ii) that said
Material does not exceed the provisioning quantities recommended by the
Seller in the Initial Provisioning recommendations, does not have a
limited shelf life nor contain any shelf-life limited components with
less than ninety percent (90%) of their shelf life remaining when
returned to the Seller, and (iii) that the Material is returned with the
Seller's original documentation and any such documentation (including
tags, certificates) required to identify, substantiate the condition of
and enable the resale of such Material.
10.2.2 The Seller's agreement in writing is necessary before any Material in
excess of the Seller's recommendation may be considered for buy-back.
10.2.3 It is expressly understood and agreed that the rights granted to the
Buyer under this Paragraph 10.2 will not apply to Material that may
become obsolete at any time or for any reason other than as set forth in
Paragraph 10.1 above.
10.2.4 Further, it is expressly understood and agreed that all credits referred
to above in Paragraph 10.1(b) will be provided by the Seller to the
Buyer exclusively by means of credit notes to be entered into the
Buyer's account with the Seller for Material.
10.3 All transportation costs for the return of obsolete and surplus Material
under this Paragraph 10, including any applicable insurance and customs
duties or other related expenditures, will be borne by the Buyer.
10.4 The Seller's obligation to repurchase surplus and obsolete Material
depends upon the Buyer's demonstration, by the Buyer's compliance with
the requirements set forth in Paragraph 9 of this Letter Agreement, that
such Material does not exceed the Initial Provisioning requirements.
Failure by the Buyer, after due notice from the Seller, to periodically
submit such data within the period specified above in Paragraph 10.1 for
the buy-back of surplus Material will discharge the Seller forthwith
from all obligations under this Paragraph 10.
11. WARRANTIES
The Seller has negotiated and obtained the following warranties for
Seller Parts from the Manufacturer with respect to the Seller Parts,
subject to the terms, conditions, limitations and restrictions all as
hereinafter set out. The Seller hereby assigns to the Buyer, and the
Buyer hereby accepts, all of the rights and obligations of the Seller
under the said warranties for Seller Parts delivered to the Buyer
pursuant to this Letter Agreement, and the Seller subrogates to the
Buyer all such rights and obligations in respect of such Seller Parts.
The Seller hereby warrants to the Buyer that it has all the requisite
authority to make the foregoing assignment and effect the foregoing
subrogation to and in favor of the Buyer and
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that it will not enter into any amendment of the provisions so assigned
or subrogated without the prior written consent of the Buyer.
It is understood that in the provisions below between the words QUOTE
and UNQUOTE, capitalized terms have the meanings assigned thereto in
this Letter Agreement, except that the term Seller refers to the
Manufacturer and the term Buyer means the Seller.
QUOTE
11.1 SELLER PARTS
Subject to the limitations and conditions as hereinafter provided, the
Seller warrants to the Buyer that all Seller Parts as defined above in
Paragraph 1.1(a) will at the time of delivery to the Buyer:
(a) be free from defects in material,
(b) be free from defects in workmanship, including, without
limitation, processes of manufacture,
(c) be free from defects in design (including, without limitation,
selection of materials) having regard to the state of the art at
the date of such design.
11.2 WARRANTY PERIOD
11.2.1.1 The warranty period for defects in new Seller Parts is thirty-six (36)
months after delivery of such Seller Parts to the Buyer (the "Warranty
Period").
11.2.1.2 The warranty period for used Seller Parts delivered by and/or repaired
by the Seller is twelve (12) months after delivery of such parts to
the Buyer.
11.3 BUYER'S REMEDY AND SELLER'S OBLIGATION
The Buyer's remedy and Seller's obligation and liability under this
Paragraph 11 are limited to the repair, replacement or correction, at
the Seller's expense and option, of any defective Seller Part.
The Seller, at its option, may furnish a credit to the Buyer for the
future purchase of Seller Parts equal to the price at which the Buyer
is then entitled to acquire a replacement for the defective Seller
Part.
The provisions of Clauses 12.1.5, 12.1.6 and 12.1.7 of the Agreement
will, as applicable, also apply to this Paragraph 11.
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11.4 EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY AND
DUPLICATE REMEDIES
The Buyer and the Seller recognize and agree that the Exclusivity of
Warranties and General Limitations of Liability provisions and the
Duplicate Remedies provisions contained in Clause 12 of the Agreement will
also apply to the foregoing warranties provided for in this Paragraph 11.
UNQUOTE
In consideration of the assignment and subrogation by the Seller under
this Paragraph 11 in favor of the Buyer in respect of the Seller's rights
against and obligations to the Manufacturer under the provisions quoted
above, the Buyer hereby accepts such assignment and subrogation and agrees
to be bound by all of the terms, conditions and limitations therein
contained.
EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY AND
DUPLICATE REMEDIES
THIS PARAGRAPH 11 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE EXCLUSIVE
WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE OBLIGATIONS OF THE SELLER,
AND THE EXCLUSIVE REMEDIES AVAILABLE TO THE BUYER, WHETHER UNDER THIS
LETTER AGREEMENT OR OTHERWISE, ARISING FROM ANY DEFECT OR NONCONFORMITY OR
PROBLEM OF ANY KIND IN ANY SELLER PART DELIVERED UNDER THIS LETTER
AGREEMENT.
THE BUYER RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES IN THIS
PARAGRAPH 11 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYER FROM ANY
DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS AND SERVICES
SUPPLIED UNDER THIS LETTER AGREEMENT. THE BUYER HEREBY WAIVES, RELEASES
AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS, GUARANTEES AND
LIABILITIES OF THE SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES OF THE
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 SELLER PART DELIVERED UNDER THIS LETTER
AGREEMENT, INCLUDING BUT NOT LIMITED TO:
(1) ANY IMPLIED WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR ANY
GENERAL OR PARTICULAR PURPOSE;
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(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, INCLUDING ACTIONS FOR
NEGLIGENCE, RECKLESSNESS, INTENTIONAL TORTS, IMPLIED WARRANTY IN
TORT AND/OR STRICT LIABILITY;
(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 THE AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT, COMPONENT,
EQUIPMENT, ACCESSORY OR PART PROVIDED UNDER THE AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE ABOVE LIMITATIONS WILL NOT BE INTERPRETED TO IMPAIR THE WARRANTIES
GRANTED TO THE BUYER HEREUNDER.
THE WARRANTIES PROVIDED BY THIS LETTER AGREEMENT WILL NOT BE EXTENDED,
ALTERED OR VARIED EXCEPT BY A WRITTEN INSTRUMENT SIGNED BY THE SELLER AND
THE BUYER. IN THE EVENT THAT ANY PROVISION OF THIS PARAGRAPH 11 SHOULD FOR
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ANY REASON BE HELD UNLAWFUL, OR OTHERWISE, UNENFORCEABLE, THE REMAINDER
OF THE PARAGRAPH 11 WILL REMAIN IN FULL FORCE AND EFFECT.
The remedies provided to the Buyer under this Paragraph 11 as to any
defect in respect of the Aircraft or any part thereof are mutually
exclusive and not cumulative. The Buyer will be entitled to the remedy
that provides the maximum benefit to it, as the Buyer may elect, pursuant
to the terms and conditions of this Paragraph 11 for any such particular
defect for which remedies are provided under this Paragraph 11; provided,
however, that the Buyer will not be entitled to elect a remedy under one
part of this Paragraph 11 that constitutes a duplication of any remedy
elected by it under any other part hereof for the same defect. The Buyer's
rights and remedies herein for nonperformance of any obligation or
liability of the Seller arising under these warranties will be in monetary
damages limited to the amount the Buyer expends in procuring a connection
or replacement for any covered part subject to a defect or nonperformance
covered by this Paragraph 11, and the Buyer will not have any right to
require specific performance by the Seller.
NEGOTIATED AGREEMENT
The Buyer and the Seller agree that this Paragraph 11 has been the subject
of discussion and negotiation and is fully understood by the parties, and
that the price of the Aircraft and the other mutual agreements of the
parties set forth in the Agreement were arrived at in consideration of,
INTER ALIA, the Exclusivity of Warranties and General Limitations of
Liability provisions and Duplicate Remedies provisions set forth in
Paragraph 11.4 above.
12. LEASING
12.1 APPLICABLE TERMS
The terms and conditions of this Paragraph 12 will apply to the Lessor's
(as defined below) stock of Seller Parts listed in Appendix "A" to this
Paragraph 12 ("Leased Parts") and will form a part of each lease of any
Leased Part by the Buyer from the Seller after the date hereof. Except for
the description of the Leased Part, the Lease Term, the Leased Part
delivery and return locations and the Lease Charges (defined below in
Paragraph 12.4), all other terms and conditions appearing on any order
form or other document pertaining to Leased Parts will be deemed
inapplicable, and in lieu thereof the terms and conditions of this
Paragraph 12 will prevail. For purposes of this Paragraph 12, the term
"Lessor" refers to the Seller and the term "Lessee" refers to the Buyer.
Parts not included in Appendix "A" to this Paragraph 12 may be supplied
under a separate lease agreement between the Seller and the Buyer.
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12.2 LEASE PROCEDURE: SPARE PARTS LEASED
At the Lessee's request by telephone (to be confirmed promptly in
writing), telegram, letter or other written instrument, the Lessor
will lease Leased Parts, which will be made available in accordance
with Paragraph 4.2.3 of this Letter Agreement, to the Lessee as
substitutes for parts withdrawn from an Aircraft for repair or
overhaul. Each lease of Leased Parts will be evidenced by a lease
document ("Lease") issued by the Lessor to the Lessee no later than
seven (7) business days after delivery of the Leased Part.
12.3 LEASE TERM: RETURN
The term of the lease ("Lease Term") will commence on the date of
dispatch of the Leased Part to the Lessee or its agent at the
Lessor's facility and will end on the date of receipt at the
Lessor's facility of the Leased Part or exchanged part in a
serviceable condition. The Lease Term will not exceed thirty (30)
days after such date of dispatch, unless extended by written
agreement between Lessor and Lessee within such thirty (30)-day
period (such extension not to exceed an additional thirty (30)
days). Notwithstanding the foregoing, the Lease Term will end in the
event, and upon the date, of exercise of the Lessee's option to
either purchase or exchange the Leased Part, as provided herein.
12.4 LEASE CHARGES AND TAXES
The Lessee will pay the Lessor (a) a daily rental charge for the
Lease Term in respect of each Leased Part equal to
one-three-hundred-sixty-fifth (1/365) of the Catalog Price of such
Leased Part, as set forth in the Seller's Spare Parts Price List in
effect on the date of commencement of the Lease Term, (b) any
reasonable additional costs which may be incurred by the Lessor as a
direct result of such Lease, such as inspection, test, repair,
overhaul and repackaging costs as required to place the Leased Part
in satisfactory condition for lease to a subsequent customer, (c)
all transportation and insurance charges and (d) any taxes, charges
or customs duties imposed upon the Lessor or its property as a
result of the lease, sale, delivery, storage or transfer of any
Leased Part (the "Lease Charges"). All payments due hereunder will
be made in accordance with Paragraph 6 of this Letter Agreement.
In the event that the Leased Part has not been returned to the
Lessor's designated facilities within the time period provided in
Paragraph 12.3 above, the Lessor will be entitled, in addition to
any other remedy it may have at law or under this Paragraph 12, to
charge to the Lessee, and the Lessee will pay, all of the charges
referred to in this Paragraph 12.4 accruing for each day after the
end of the Lease
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Term and for as long as such Leased Part is not returned to the
Lessor and as though the Lease Term were extended to the period of
such delay.
12.5 TITLE
Title to each Leased Part will remain with the Lessor at all times
unless the Lessee exercises its option to purchase it in accordance
with Paragraph 12.8 of this Letter Agreement, in which case title
will pass to the Lessee in accordance with Paragraph 7 of this
Letter Agreement.
12.6 RISK OF LOSS
Except for normal wear and tear, each Leased Part will be returned
to the Lessor in the same condition as when delivered to the Lessee.
However, the Lessee will not without the Lessor's prior written
consent repair, modify or alter any Leased Part. Risk of loss or
damage to each Leased Part will remain with the Lessee until such
Leased Part is redelivered to the Lessor at the return location
specified in the applicable Lease. If a Leased Part is lost or
damaged beyond repair, the Lessee will be deemed to have exercised
its option to purchase the part in accordance with Paragraph 12.8 of
this Letter Agreement, as of the date of such loss or damage.
12.7 RECORD OF FLIGHT HOURS
All flight hours accumulated by the Lessee on each Leased Part
during the Lease Term will be documented by the Lessee. Records will
be delivered to the Lessor upon return of such Leased Part to the
Lessor. In addition, all documentation pertinent to inspection,
maintenance and/or rework of the Leased Part as maintained
serviceable in accordance with the standards of the Lessor will be
delivered to the Lessor upon return of the Leased Part to the Lessor
on termination of the Lease.
Such documentation will include but not be limited to evidence of
incidents such as hard landings, abnormalities of operation and
corrective action taken by the Lessee as a result of such incidents.
12.8 OPTION TO PURCHASE
12.8.1 The Lessee may at its option, exercisable by written notice given to
the Lessor, elect during or at the end of the Lease Term to purchase
the Leased Part. If the Leased Part is new, the then current
purchase price for such Leased Part as set forth in the Seller's
Spare Parts Price List will be paid by the Lessee to the Lessor. If
the Leased Part is used, [****] of the then current purchase price
for such Leased Part will be paid by the Lessee to the Lessor. Such
option
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[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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will be contingent upon the Lessee's providing the Lessor with
evidence satisfactory to the Lessor that the original part fitted to
the Aircraft is beyond economical repair. Should the Lessee exercise
such option, [****] ([****]) of the Lease rental charges
already invoiced pursuant to Paragraph 12.4 (a) will be credited to
the Lessee against the said purchase price of the Leased Part.
12.8.2 In the event of purchase, the Leased Part will be warranted in
accordance with Clause 11 of this Letter Agreement as though such
Leased Part were a Seller Part; provided, however, that (i) the
Seller will prorate the full Warranty Period granted to the Buyer
according to the actual usage of such Leased Part and (ii) in no
event will such Warranty Period be less than six (6) months from the
date of purchase of such Leased Part. A warranty granted under this
Paragraph 12.8.3 will be in substitution for the warranty granted
under Paragraph 12.9 at the commencement of the Lease Term.
12.9 WARRANTIES
The Lessor has negotiated and obtained the following warranties from
the Manufacturer with respect to the Leased Parts, subject to the
terms, conditions, limitations and restrictions all as hereinafter
set out. The Lessor hereby assigns to the Lessee, and the Lessee
hereby accepts, all of the rights and obligations of the Lessor
under the said warranties, and the Lessor subrogates to the Lessee
all such rights and obligations of the Lessor in respect of Leased
Parts during the Lease Term. The Lessor hereby warrants to the
Lessee that it has all requisite authority to make the foregoing
assignment and effect the foregoing subrogation to and in favor of
the Lessee and that it will not enter into any amendment of the
provisions so assigned or subrogated without the prior written
consent of the Lessee.
It is understood that in the provisions below between the words
QUOTE and UNQUOTE, capitalized terms have the meanings assigned
thereto in this Letter Agreement, except that the term Lessor refers
to the Manufacturer and the term Lessee refers to the Lessor.
QUOTE
12.9.1 The Lessor warrants that each Leased Part will at the time of
delivery thereof:
(a) conform to the applicable specification for such part,
(b) be free from defects in material and
(c) be free from defects in workmanship, including without
limitation processes of manufacture.
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[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
<Page>
12.9.2 SURVIVAL OF WARRANTIES
With respect to each Leased Part, the warranty set forth above in
Paragraph 12.9.1 will survive delivery only upon the conditions and
subject to the limitations set forth below in Paragraphs 12.9.3
through 12.9.8.
12.9.3 WARRANTY AND NOTICE PERIODS
The Lessee's remedy and the Lessor's obligation and liability under
this Paragraph 12.9, with respect to each defect, are conditioned
upon (i) the defect having become apparent to the Lessee within the
Lease Term and (ii) the Lessor's warranty administrator having
received written notice of the defect from the Lessee within sixty
(60) days after the defect became apparent to the Lessee.
12.9.4 RETURN AND PROOF
The Lessee's remedy and the Lessor's obligation and liability under
this Paragraph 12.9, with respect to each defect, are also
conditioned upon:
(a) the return by the Lessee as soon as practicable to the return
location specified in the applicable Lease, or such other
place as may be mutually agreeable, of the Leased Part claimed
to be defective, and
(b) the submission by the Lessee to the Lessor's warranty
administrator of reasonable proof that the claimed defect is
due to matter embraced within the Lessor's warranty under
this Paragraph 12.9 and that such defect did not result from
any act or omission of the Lessee, including but not limited
to any failure to operate or maintain the Leased Part claimed
to be defective or the Aircraft in which it was installed in
accordance with applicable governmental regulations and the
Lessor's applicable written instructions.
12.9.5 REMEDIES
The Lessee's remedy and the Lessor's obligation and liability under
this Paragraph 12.9 with respect to each defect are limited to the
repair of such defect in the Leased Part in which the defect
appears, or, as mutually agreed, to the replacement of such Leased
Part with a similar part free from defect.
Any replacement part furnished under this Paragraph 12.9.5 will for
the purposes of this Letter Agreement be deemed to be the Leased
Part so replaced.
LA1-25
<Page>
12.9.6 SUSPENSION AND TRANSPORTATION COSTS
12.9.6.1 If a Leased Part is found to be defective and is covered by this
warranty, the Lease Term and the Lessee's obligation to pay rental
charges as provided in Paragraph 12.4(a) of this Letter Agreement
will be suspended from the date on which the Lessee notifies the
Lessor of such defect until the date on which the Lessor has
repaired, corrected or replaced the defective Leased Part, provided,
however, that the Lessee has withdrawn such defective Leased Part
from use, promptly after giving such notice to the Lessor. If the
defective Leased Part is replaced, such replacement will be deemed
to no longer be a Leased Part under the Lease as of the date on
which such part was received by the Lessor at the return location
specified in the applicable Lease.
If a Leased Part is found to be defective on first use by the Lessee
and is coveted by this warranty, rental charges as provided in
Paragraph 12.4(a) will not accrue and will not be payable by the
Lessee until the date on which the Lessor has repaired, corrected or
replaced the defective Leased Part.
12.9.6.2 All transportation and insurance costs associated with the return of
the defective Leased Part to the Lessor and the return of the
repaired, corrected or replacement part to the Lessee will be borne
by the Lessor.
12.9.7 WEAR AND TEAR
Normal wear and tear and the need for regular maintenance and
overhaul will not constitute a defect or nonconformance under this
Paragraph 12.9.
12.9.8 EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY AND
DUPLICATE REMEDIES
The Lessee and the Lessor recognize and agree that the Exclusivity
of Warranties and General Limitations of Liability provisions and
the Duplicate Remedies provisions contained in Clause 12 of the
Agreement will also apply to the foregoing warranties provided for
in this Paragraph 12.9.
UNQUOTE
In consideration of the assignment and subrogation by the Seller
under this Paragraph 12.9 in favor of the Buyer in respect of the
Seller's rights against and obligations to the Manufacturer under
the provisions quoted above, the Buyer hereby accepts such
assignment and subrogation and agrees to be bound by all of the
terms, conditions and limitations therein contained.
LA1-26
<Page>
EXCLUSIVITY OF WARRANTIES AND GENERAL LIMITATIONS OF LIABILITY AND
DUPLICATE REMEDIES
THIS PARAGRAPH 12 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE
EXCLUSIVE WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE
OBLIGATIONS OF THE SELLER, AND THE EXCLUSIVE REMEDIES AVAILABLE TO
TUE BUYER, WHETHER UNDER THIS LETTER AGREEMENT OR OTHERWISE, ARISING
FROM ANY DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN ANY
LEASED PART DELIVERED UNDER THIS LETTER AGREEMENT.
THE BUYER RECOGNIZES THAT THE RIGHTS, WARRANTIES AND REMEDIES IN
THIS PARAGRAPH 12 ARE ADEQUATE AND SUFFICIENT TO PROTECT THE BUYER
FROM ANY DEFECT OR NONCONFORMITY OR PROBLEM OF ANY KIND IN THE GOODS
AND SERVICES SUPPLIED UNDER THIS LETTER AGREEMENT. THE BUYER HEREBY
WAIVES, RELEASES AND RENOUNCES ALL OTHER WARRANTIES, OBLIGATIONS,
GUARANTEES AND LIABILITIES OF THE SELLER AND ALL OTHER RIGHTS,
CLAIMS AND REMEDIES OF THE 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
LEASED PART DELIVERED UNDER THIS LETTER 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, INCLUDING ACTIONS FOR
NEGLIGENCE, RECKLESSNESS, INTENTIONAL TORTS, IMPLIED WARRANTY
IN TORT AND/OR STRICT LIABILITY;
(5) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER THE UNIFORM
COMMERCIAL CODE, OR ANY OTHER STATE OR FEDERAL STATUTE;
LA1-27
<Page>
(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 THE
AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY OR PART PROVIDED UNDER
THE AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE ABOVE LIMITATIONS WILL NOT BE INTERPRETED TO IMPAIR THE
WARRANTIES GRANTED TO THE BUYER HEREUNDER.
THE WARRANTIES PROVIDED BY THIS LETTER AGREEMENT WILL NOT BE
EXTENDED, ALTERED OR VARIED EXCEPT BY A WRITTEN INSTRUMENT SIGNED BY
THE SELLER AND THE BUYER. IN THE EVENT THAT ANY PROVISION OF THIS
PARAGRAPH 12 SHOULD FOR ANY REASON BE HELD UNLAWFUL, OR OTHERWISE
UNENFORCEABLE, THE REMAINDER OF THIS PARAGRAPH 12 WILL REMAIN IN
FULL FORCE AND EFFECT.
The remedies provided to the Buyer under this Paragraph 12 as to any
defect in respect of the Aircraft or any part thereof are mutually
exclusive and not cumulative. The Buyer will be entitled to the
remedy which provides the maximum benefit to it, as the Buyer may
elect, pursuant to the terms and conditions of this Paragraph 12 for
any such particular defect for which remedies are provided under
this Paragraph 12; provided, however, that the Buyer will not be
entitled to elect a remedy under one part of this Paragraph 12 which
constitutes a duplication of any remedy elected by it under any
other part hereof for the same defect. The Buyer's rights and
remedies for nonperformance of any obligation or liability of the
Seller arising under these warranties will be in monetary damages
limited to the amount the Buyer expends in procuring a correction or
replacement
LA1-28
<Page>
for any covered part subject to a defect or nonperformance covered
by this Paragraph 12, and the Buyer will not have any right to
require specific performance by the Seller.
NEGOTIATED AGREEMENT
The Buyer and the Seller agree that this Paragraph 12.9 has been the
subject of discussion and negotiation and is fully understood by the
parties, and that the price of the Aircraft and the other mutual
agreements of the parties set forth in the Agreement were arrived at
in consideration of, inter alia, the Exclusivity of Warranties
provisions and General Limitations of Liability provisions set forth
in Paragraph 12.9.8 above.
LA1-29
<Page>
APPENDIX "A" TO CLAUSE 12
SELLER PARTS LEASING LIST
(LEASED PARTS)
AILERONS
AUXILIARY POWER UNIT (APU) DOORS
CARGO DOORS
PASSENGER DOORS
ELEVATORS
FLAPS
LANDING GEAR DOORS
RUDDER
TAIL CONE
WING SLATS
SPOILERS
AIRBRAKES
WING TIPS
LA1-30
<Page>
13. TERMINATION
Any termination under Clause 10, 11 or 21 of the Agreement or Letter
Agreements thereto will discharge all obligations and liabilities of
the parties hereunder with respect to such undelivered Material,
services, data or other items to be purchased hereunder that are
applicable to those Aircraft as to which the Agreement has been
terminated. Termination under this Paragraph 13 notwithstanding new
and unused Material in excess of the Buyer's requirements due to
such Aircraft cancellation will be repurchased by the Seller as
provided in Paragraph 10.2 of this Letter Agreement.
14. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of
the Agreement, this Letter Agreement and the rights and obligations
of the Buyer hereunder will not be assigned or transferred in any
manner without the prior written consent of the Seller, and any
attempted assignment or transfer in contravention of the provisions
of this Paragraph 14 will be void and of no force or effect.
LA1-31
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: /s/ [ILLEGIBLE]
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
-----------------------------
Its: CEO
---------------------------
Date: 4/20/99
--------------------------
LA1-32
<Page>
LETTER AGREEMENT NO. 2
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: SPECIFICATION
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 2 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. AIRCRAFT MTOW
In order for the Buyer to be able to fly all the missions contemplated in
the Buyer's slot-exemption application to the U.S. Department of
Transportation (the "Missions") with maximum passengers (max pax), [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA2-1
<Page>
[****]
2. LIQUID CRYSTAL DISPLAYS
The Seller grants the Buyer the option to have Aircraft delivered with
liquid crystal displays (LCDs) in place of cathode ray tubes (CRTs) when
they are available for implementation on A320-200 aircraft on the assembly
line. [****] Incorporation of LCDs into aircraft in production is
currently scheduled for 2001.
3. STEEL BRAKES
The Seller grants the Buyer the option to have Aircraft delivered with
Allied Signal convertible steel brakes, when they are available for
A320-200 aircraft on the assembly line. These brakes will be available for
the Aircraft under terms and conditions to be agreed between the Buyer and
the Seller.
4. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 4 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA2-2
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its: _____________________________
Date: ____________________________
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA2-3
<Page>
LETTER AGREEMENT NO. 3
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: MISCELLANEOUS
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 3 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used
herein and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. AVSA CREDIT MEMORANDA
1.1 AIRFRAME CREDIT MEMORANDUM
The Seller offers the Buyer an airframe credit of [****] (US
dollars-- [****], in respect of each
Aircraft (the "Airframe Credit Memorandum").
The Airframe Credit Memorandum is quoted at January 1999 delivery
conditions and is subject to escalation in accordance with the Airframe
Price Revision Formula. Each Airframe Credit Memorandum will be available
at delivery of the applicable Aircraft. At the Buyer's option, each
Airframe Credit Memorandum
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA3-1
<Page>
will be (i) applied by the Seller against the Final Contract Price of the
applicable Aircraft or (ii) applied by the Buyer against the purchase of
product support related goods and services from the Seller or its
Affiliates.
1.2 SUPPLEMENTAL CREDIT MEMORANDUM
The Seller offers the Buyer a supplemental airframe credit of [****] (US
dollars-- [****] in respect of each Firm Aircraft
(the "Supplemental Airframe Credit Memorandum").
The Supplemental Airframe Credit Memorandum is quoted at January 1999
delivery conditions and is subject to escalation in accordance with the
Airframe Price Revision Formula. Each Supplemental Credit Memorandum will
be available at delivery of the applicable Firm Aircraft. At the Buyer's
option, each Supplemental Credit Memorandum will be (i) applied by the
Seller against the Final Contract Price of the applicable Firm Aircraft or
(ii) applied by the Buyer against the purchase of product support related
goods and services from the Seller or its Affiliates.
2. [****]
3. TAXES
The Buyer and the Seller agree that the following paragraph will replace
in its entirety Clause 3.3.2 of the Agreement.
QUOTE
3.3.2 [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA3-2
<Page>
[****]
UNQUOTE
4. INITIAL DELIVERIES
[****]
5. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 5 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA3-3
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its: _____________________________
Date: ____________________________
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA3-4
<Page>
LETTER AGREEMENT NO. 4
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: FLEXIBILITY RIGHTS
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 4 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA4-1
<Page>
2. OPTION AIRCRAFT
2.1 OPTION EXERCISE
The Buyer may exercise its option to purchase each Option Aircraft
scheduled for Delivery in any given calendar year quarter by giving
written notice to the Seller by [****] months before the start of
that quarter and by, concurrent with this notice, paying the Seller the
first Predelivery Payment as set forth below in Paragraph 2.5. In respect
of each Option Aircraft for which the Buyer lets lapse its right to option
exercise, the Buyer and the Seller will have no more rights or
obligations.
2.2 DELIVERY
The Seller will have the Option Aircraft Ready for Delivery at the
Delivery Location in accordance with Clause 9.1.1 of the Agreement.
2.3 BASE PRICE
The Base Price of the Option Aircraft will be the same as for the Firm
Aircraft, the terms and conditions of which are set forth in Clause 3 of
the Agreement.
2.4 CREDIT MEMORANDUM
The Seller will provide the Buyer with an Airframe Credit Memorandum for
each Option Aircraft equal to and subject to the same terms and conditions
as for the Firm Aircraft, as set forth in Paragraph 1.1 of Letter
Agreement No. 3 to the Agreement.
2.5 PREDELIVERY PAYMENTS
The first Predelivery Payment for each Option Aircraft converted to a firm
order will be paid on the Buyer's written notification to the Seller of
its exercise of the option to purchase such Option Aircraft, as set forth
in the schedule set forth in Clause 5.2.3 of the Agreement. Subsequent
Predelivery Payments for Option Aircraft converted to a firm order will
also be paid as set forth in Clause 5.2.3 of the Agreement.
2.6 OTHER MATTERS
It is understood that terms specifically applicable only to Firm Aircraft
do not apply to Option Aircraft, even when an Option Aircraft is converted
into a firm order.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA4-2
<Page>
3. ADDITIONAL AIRCRAFT
3.1 The Seller will offer the Buyer delivery positions for A320 Additional
Option Aircraft equal to the number of Option Aircraft for which the Buyer
exercises its purchase right, in accordance with Paragraph 2 above. The
Seller will advise the Buyer of these delivery positions when the option
to firmly order Option Aircraft is exercised as set forth above in
Paragraph 2.2. The Buyer will accept the delivery position by making a
nonrefundable deposit of [****] (US dollars-- [****]),
within [****] days of the Seller's advise regarding delivery
positions.
3.2 Once a delivery position for an A320 Additional Option Aircraft has been
allocated to the Buyer and the Buyer has paid the corresponding deposit,
then the terms and conditions applicable to Option Aircraft set out in the
Agreement will be extended to apply for such A320 Additional Option
Aircraft, and such A320 Additional Option Aircraft will be deemed to be
Option Aircraft, so long as delivery for the A320 Additional Option
Aircraft is scheduled by December 31, [****].
3.3 In respect of each A320 Additional Option Aircraft for which the Buyer
lets lapse its right to option exercise, the Buyer and the Seller will
have no more rights or obligations.
4. CONVERSION
4.1 CONVERSION RIGHT
The Seller grants the Buyer the right to convert Option Aircraft to
A319-100 model aircraft (the "A319 Aircraft") or A321-200 model aircraft
(the "A321 Aircraft") under the following terms (the "Conversion Right"):
(i) The Buyer will exercise Conversion Rights for Option Aircraft
scheduled for Delivery in any given calendar year quarter by giving
written notice to the Seller by [****] months before the
start of that quarter.
(ii) The Seller does not guarantee that the delivery date for a converted
aircraft will be the same as the delivery date for the Option
Aircraft from which it is converted.
(iii) The Buyer's exercise of a Conversion Right for an Option Aircraft
will also constitute exercise of the option to firmly order such
Option Aircraft, in accordance with Paragraph 1 of this Letter
Agreement.
(iv) Each Option Aircraft may be the subject of a Conversion Right once
only.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA4-3
<Page>
(v) Each Conversion Right is subject to the agreement of the Propulsion
Systems manufacturer.
4.2 SPECIFICATION
In the event that the Buyer exercises a Conversion Right, the
specification applicable to the A319 Aircraft and A321 Aircraft will be as
follows:
(i) The A319 Aircraft will be built in accordance with the A319-100
Standard Specification No. J.000.01000, Issue 4, dated January 30,
1998, published by the Manufacturer, which includes an MTOW of 64
metric tons.
(ii) The A321 Aircraft will be built in accordance with the A321-200
Standard Specification No. E.000.02000, Issue 5, dated January 30,
1998, published by the Manufacturer, modified to include an MTOW of
93 metric tons.
(iii) The propulsion systems for the A319 Aircraft will be either the IAE
V2522-A5 or IAE V2524-A5 powerplants; and the propulsion systems for
the A321 Aircraft will be the IAE V2533-A5.
4.3 PRICE
In the event that the Buyer exercises a Conversion Right under Paragraph
4.1 above, [****]
4.4 OTHER MATTERS
On exercise of a Conversion Right pursuant to Paragraph 4.1, the Agreement
and all Letter Agreements to the Agreement will apply to the A319 Aircraft
and A321 Aircraft MUTATIS MUTANDIS, unless otherwise agreed herein.
4.5 AMENDMENT
In the event that a Conversion Right is exercised in accordance with
Paragraph 4.1 above, an amendment to the Agreement will be executed within
thirty (30) days of the Buyer's exercise of its Conversion Right. The
amendment will include pricing and all other applicable terms and
conditions corresponding to A319 Aircraft and/or A321 Aircraft, based on
the terms and conditions of this Paragraph 4.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA4-4
<Page>
5. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 5 will be
void and of no force or effect.
LA4-5
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
----------------------------
Date: 4-20-99
----------------------------
LA4-6
<Page>
LETTER AGREEMENT NO. 5
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: [****]
Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 5 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA5-1
<Page>
2. [****]
2.1 [****]
3. [****]
4. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 4 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA5-2
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
------------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA5-3
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LETTER AGREEMENT NO. 6
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: PRODUCT SUPPORT
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 6 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. PRODUCT SUPPORT CREDIT
In consideration of the Buyer's purchase of the Aircraft, the Seller will
make available to the Buyer a credit memorandum of US [****] (US
dollars-- [****]) for goods and services to be purchased from ASCO
(including spare parts and training goods and services) (the "Product
Support Credit"). [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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In the event that (i) the Seller terminates the Agreement in respect of
any or all Firm Aircraft pursuant to its rights under the Agreement or
(ii) the Buyer breaches its obligation to take delivery of all Firm
Aircraft under the Agreement, the Buyer will reimburse to the Seller a
dollar amount equal to the used portion of the Product Support Credit.
2. [****]
3. WARRANTY
[****]
4. [****]
For each Option Aircraft firmly ordered by the Buyer pursuant to Paragraph
2 of Letter Agreement No. 4 to the Agreement, the Seller will [****]
5. [****]
6. SPARE PARTS PRICES
[****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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[****]
7. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 7 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA6-4
<Page>
LETTER AGREEMENT NO. 7
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: DISPATCH RELIABILITY GUARANTEE
Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 7 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
The Seller, under its arrangement with the Manufacturer, has negotiated
and obtained the following dispatch reliability guarantee from the Manufacturer
with respect to the Aircraft, subject to the terms, conditions, limitations and
restrictions all as hereinafter set out. The Seller hereby guarantees to the
Buyer the performance by the Manufacturer of its obligations under this dispatch
reliability guarantee and hereby assigns to the Buyer, and the Buyer hereby
accepts, all of the rights and obligations of the Seller as aforesaid under the
said dispatch reliability guarantee, and the Seller subrogates to the Buyer all
such rights and obligations in respect of the Aircraft. The Seller hereby
warrants to the Buyer that it has all requisite authority to make the foregoing
assignment and effect the foregoing subrogation to and in favor of the Buyer and
that it will not enter into any amendment of the provisions so assigned or
subrogated without the prior written consent of the Buyer.
It is understood that in the provisions below between the words QUOTE and
UNQUOTE, capitalized terms have the meanings assigned thereto in this Letter
Agreement, except that the term Seller refers to the Manufacturer and the term
Buyer means the Seller.
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QUOTE
1. SCOPE, COMMENCEMENT, DURATION, DEFINITIONS
This dispatch reliability guarantee (the "Guarantee") extends to the
Aircraft fleet, will commence with delivery of the first Aircraft and will
remain in force for a period of [****] (the "Term"), unless the
Guarantee is extended two (2) years beyond the Term under the terms of
Paragraph 3.2 below. ETOPS flights are not included in this Guarantee. It
is agreed that for the purposes of this Letter Agreement only, [****]
All terms used in this Guarantee and not defined in this Paragraph 1 or in
Paragraph 2 are defined below in Paragraph 4.
2. SUSPENSION OF GUARANTEE
The provisions of the Guarantee will be suspended during any computation
period during which:
Rf LESS THAN Ro - 1.0%
Where:
Ro is the Dispatch Reliability as computed by the Manufacturer and
published in the "Quarterly Service Report," of the world fleet of
aircraft of the same type as the Aircraft, but excluding the
Aircraft, during a computation period, expressed as a percentage.
Rf is the Dispatch Reliability as computed by the Manufacturer and
published in the "Quarterly Service Report," of the Aircraft fleet
during the same computation period, expressed as a percentage.
3. GUARANTEE
3.1 FIRST YEAR OF TERM
The Seller guarantees that, from the first three-month Computation Period
following delivery of the first Aircraft, the Achieved Dispatch
Reliability Level will be at least [****]. This level
will be maintained until the end of the first year of operation of the
Aircraft fleet following delivery of the first Aircraft.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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3.2 REMAINING YEARS OF GUARANTEE
Provided that the Buyer's personnel complete a mutually agreed course
of training, the Seller guarantees that from the first three-month
Computation Period after the beginning of the second year of operation
of the first Aircraft and the end of the Term, the Achieved Dispatch
Reliability Level will be at least [****]. In the event that the Buyer
demonstrates that the Achieved Dispatch Reliability Level is less than
[****] in any Computation Period during the fourth year of operation,
then the Seller will extend the Term of this Guarantee by two (2) years.
4. DEFINITIONS
4.1 ACHIEVED DISPATCH RELIABILITY LEVEL COMPUTATION AND COMPUTATION PERIOD
"Achieved Dispatch Reliability Level" is the actual Dispatch Reliability
obtained by the Aircraft fleet in regular revenue service and adjusted to
the clauses of this Guarantee.
Achieved Dispatch Reliability Level, expressed as a percent, will be
computed monthly ("Computation") on the basis of a three-month moving
average period ("Computation Period") as follows:
Total number of Revenue Flights without
Achieved Chargeable Delays or Cancellations
Dispatch during the Computation Period x 136
Reliability = -------------------------------------------
Level Total number of Revenue Flights
during the Computation Period
4.2 AIRCRAFT INHERENT MALFUNCTION
An "Aircraft Inherent Malfunction" is a condition whereby maintenance
action confirms that the operation of a system or component is outside its
specific limit.
4.3 CANCELLATION
A "Cancellation" is a Revenue Flight that does not take place. The
cancellation of any or all of the flight legs of a multi-leg flight
constitutes only one (1) Cancellation.
4.4 CHARGEABLE DELAY
A "Chargeable Delay" is a delay that occurs when, for reasons other than
those defined under "Excluded Delay," a primary Aircraft Inherent
Malfunction causes either:
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA7-3
<Page>
(i) an originating Revenue Flight to depart more than fifteen (15)
minutes later than the scheduled departure time, or
(ii) a revenue-through-service or turnaround flight to remain on the
ground more than fifteen (15) minutes longer than the allowable
ground time.
4.5 DISPATCHED
An Aircraft will be deemed to have been "Dispatched" when it leaves the
gate for a Revenue Flight.
4.6 EXCLUDED DELAY
An "Excluded Delay" is any Delay that is not a Chargeable Delay and any
delay in scheduled departure due to the causes listed below. Excluded
Delays are excluded from this Guarantee.
(1) SERVICING - NO CORRECTIVE MAINTENANCE PERFORMED
Struts
Oil
Hydraulic fluid
Lubrication
All servicing activities that do not require the mechanic to
physically adjust or replace or defer structural repair and replace
hardware/software
Fueling related
Deicing
Water and waste
Sanitizing / flushing
Moisture and condensation
Printer paper replacement
Routine cleaning
Tire pressure servicing
(2) PRECAUTIONARY MAINTENANCE - NO CORRECTIVE MAINTENANCE PERFORMED
Installing/continuing placard
Hydraulic leaks - within limits
Fuel leak - within limits
Manual closing or cycling passenger/crew/cargo door
Decals/paint/appearance items
Passenger amenity lamps
Tires - worn past limits
Brakes - worn past limits
Resetting circuit breakers - no corrective maintenance performed
LA7-4
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(3) SCHEDULED MAINTENANCE ACTIVITIES
COMPLETION OF SCHEDULED / PLANNED WORK CONTENT OF SCHEDULED:
Maintenance checks
Maintenance set-ups
(4) PARTS DELAYS AND CANCELLATIONS
(5) EXTERNAL FORCE DAMAGE: AIRCRAFT DAMAGE/LIGHTNING STRIKES, ETC.
(6) KNOWN PERSONNEL ERROR
(7) SECONDARY DELAY/CANCELLATION:
For any given day, a delay or cancellation of a scheduled
flight caused by the same problem that caused the original
delay or cancellation.
(8) Delays caused by systems or components being designated as "Go if"
in the Minimum-Equipment List (MEL) as approved by the Buyer's
airworthiness authorities for the Buyer's operation of the Aircraft.
(9) Delays attributable to the Propulsion Systems.
4.7 GUARANTEED DISPATCH RELIABILITY LEVEL
The guarantee levels set forth above in Paragraph 3.
4.8 REVENUE FLIGHT
A "Revenue Flight" is a flight that is either listed in the Buyer's
timetable or a scheduled charter flight of the Aircraft.
5. OBLIGATIONS
5.1 BUYER'S AND SELLER'S OBLIGATIONS
The Buyer's and Seller's specialists will mutually agree on the details of
a Chargeable Delay reporting procedure by three (3) months before delivery
of the first Aircraft.
5.2 BUYER'S OBLIGATIONS
(a) The Buyer will regularly submit Chargeable Delay data on a monthly
basis not later than fifteen (15) days after the end of the
reporting month. Such data must contain detailed information on
delays and Cancellations
LA7-5
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to allow the Seller to assess the nature of system or component
malfunctions.
(b) At any time but not later than one (1) month after a Computation, if
the Achieved Dispatch Reliability Level is below the Guaranteed
Dispatch Reliability Level, the Buyer will notify the Seller and
will request the Seller to take corrective actions. In such event,
all necessary additional detailed operational and engineering
information will be provided by the Buyer in order to allow the
Seller to determine the necessary action.
(c) The Buyer will incorporate in and apply to the Aircraft the
procedures and modifications recommended by the Seller in order to
improve the Achieved Dispatch Reliability Level. Said modifications
will be incorporated and such procedures will be applied as soon as
is reasonably possible, consistent with the Buyer's maintenance
program, following receipt of instructions and parts (if applicable)
by the Buyer, provided that:
(i) the effect of such a procedure or modification is
substantiated to the Buyer's satisfaction, and
(ii) application of such a procedure or modification is economical
and practical as determined by the Buyer's customary analysis
practice.
In the event of a disagreement between the Seller and the Buyer as
to the effectiveness of procedures or modifications proposed by the
Seller to increase the achieved level, the Buyer will demonstrate to
the Seller that pursuant to its analysis, such a modification or
procedure is not effective.
Notwithstanding the Buyer's obligations above, the Buyer may, at its
option, decline to install such modification or decline to follow
the revised procedures referred to above. If the Buyer so declines,
the Seller may adjust the Guaranteed Dispatch Reliability Level
downwards by an amount consistent with the improvement in the
Achieved Dispatch Reliability Level, based on reasonable
substantiation to the Buyer and on other operators, experience, if
any, that the reliability benefits of such modification or such
revised procedures are expected to cause.
(d) Furthermore, the Buyer agrees to set its Aircraft fleet technical
dispatch reliability goals as shown in the Buyer's regular
reliability report (or equivalent) at a level equal to or greater
than the Guaranteed Dispatch Reliability Level, so that both the
Buyer's and the Seller's technical staff can aggressively pursue
attainment of the Guaranteed Dispatch Reliability Level.
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5.3 SELLER'S OBLIGATIONS
During the Term, the Seller will provide technical and operational
analyses of delays and cancellations and will develop corrections intended
to reduce delays and, in the event that the Achieved Dispatch Reliability
Level is below the Guaranteed Dispatch Reliability Level the Seller will,
not later than six (6) months where practicable after notification by the
Buyer and at no charge to the Buyer:
(a) provide modified Manufacturer's items, either hardware of software,
to improve the Achieved Dispatch Reliability Level,
(b) make recommendations concerning the Aircraft operation and
maintenance programs, publications, and policies to improve the
Achieved Dispatch Reliability Level,
(c) assist the Buyer to cause Vendors to take action to improve the
Achieved Dispatch Reliability Level.
6. ADJUSTMENT
Any design, certification, regulatory, organizational structure or
Aircraft operation changes outside the Seller's control that may have an
effect upon the operation and dispatch characteristics of the Aircraft
will be cause for reevaluation or adjustment of this Guaranteed Dispatch
Reliability Level by mutual agreement between the Buyer and the Seller.
7. ACHIEVED DISPATCH RELIABILITY LEVEL REVIEW MEETINGS
An Achieved Dispatch Reliability Level review meeting between the Seller's
and the Buyer's representatives will be scheduled at the end of each six
(6) month period of Aircraft operation, or at some other period to be
mutually agreed. Representatives of the Buyer and the Seller will
participate in the meeting and will
(a) review current Achieved Dispatch Reliability Level,
(b) eliminate unsupported or non-Aircraft-inherent delay claims from
delay records to compute Achieved Dispatch Reliability Level,
(c) consider corrective action, if required,
(d) review the Buyer's incorporation of modifications as stated in
Paragraph 5.2 of this Letter Agreement and requirements, if any, for
reduction of the Guaranteed Dispatch Reliability Level,
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(e) review possible design, certification, regulatory, organizational
structure or Aircraft operation changes and requirements, if any,
necessitating adjustment of the Guaranteed Dispatch Reliability
Level.
8. REMEDIES
8.1 At the end of each Computation Period, the Buyer and the Seller will
jointly compare the Achieved Dispatch Reliability Level with the
Guaranteed Dispatch Reliability Level. For each Computation Period during
which a shortfall is found in the Achieved Dispatch Reliability Level, the
Seller will credit the Buyer's account with ASCO, in the amount of US$
[****] (US dollars--[****]) per percentage point of shortfall or,
in the case of a fraction of a percentage point, with a prorated portion
of this dollar amount.
8.2 For each Computation Period during which the Achieved Dispatch Reliability
Level exceeds the Guaranteed Dispatch Reliability Level, the Seller may
apply against existing or future credits issued by the Seller in
accordance with Paragraph 8.1 above the amount of US$ [****](US
dollars--[****] per percentage point of exceedance or, in the
case of a fraction of a percentage point, with a prorated portion of this
dollar amount. If at any time during the Term the amounts offset against
existing or future credits exceed existing or future Credits, the credit
balance in the Seller's favor will be carried forward into subsequent
calendar quarters until fully exhausted. However, at no time will the
Buyer be required to make payments to the Seller for credit balances in
the Seller's favor.
8.3 The Seller and the Buyer acknowledge and agree that the maximum liability
of the Seller under this Guarantee for damages (and not as penalty) will
be US$ [****](US dollars--[****].
8.4 Remedies under this Guarantee will be exclusive and will not be cumulative
with any other Guarantee provided by the Seller, the Propulsion Systems
manufacturer or any other Aircraft related vendor.
9. LIABILITY LIMITATION
The Seller's liability for failure to meet the Guarantee values will be
governed solely by the terms of this Guarantee.
UNQUOTE
ASSIGNMENT
In consideration of the assignment and subrogation by the Seller under
this Letter Agreement in favor of the Buyer in respect of the Seller's
rights against and obligations to the Manufacturer under the provisions
quoted above, the Buyer
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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hereby accepts such assignment and subrogation and agrees to be bound by
all of the terms, conditions and limitations therein contained. The Buyer
and Seller recognize and agree that all the provisions of Clause 12 of the
Agreement, including without limitation the Exclusivity of Warranties and
General Limitations of Liability and Duplicate Remedies therein contained,
will apply to the foregoing dispatch reliability guarantee.
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph will be void
and of no force or effect.
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If the foregoing correctly sets forth our understanding. please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA7-10
<Page>
LETTER AGREEMENT NO. 8
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: MAXIMUM PARTS COST GUARANTEE
Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"), have
entered into an Airbus A320 Purchase Agreement dated as of even date herewith
(the "Agreement"), which covers, among other things, the sale by the Seller and
the purchase by the Buyer of certain Aircraft, under the terms and conditions
set forth in said Agreement. The Buyer and the Seller have agreed to set forth
in this Letter Agreement No. 8 (the "Letter Agreement") certain additional terms
and conditions regarding the sale of the Aircraft. Capitalized terms used herein
and not otherwise defined in this Letter Agreement will have the meanings
assigned thereto in the Agreement. The terms "herein," "hereof" and "hereunder"
and words of similar import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
The Seller, under its arrangement with the Manufacturer, has negotiated and
obtained the following maximum parts cost guarantee from the Manufacturer with
respect to the Aircraft, subject to the terms, conditions, limitations and
restrictions all as hereinafter set out. The Seller hereby guarantees to the
Buyer the performance by the Manufacturer of its obligations under this maximum
parts cost guarantee and hereby assigns to the Buyer, and the Buyer hereby
accepts, all of the rights and obligations of the Seller as aforesaid under the
said maximum parts cost guarantee, and the Seller subrogates to the Buyer all
such rights and obligations in respect of the Aircraft. The Seller hereby
warrants to the Buyer that it has all requisite authority to make the foregoing
assignment and effect the foregoing subrogation to and in favor of the Buyer and
that it will not enter into any amendment of the provisions so assigned or
subrogated without the prior written consent of the Buyer.
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It is understood that in the provisions below between the words QUOTE and
UNQUOTE, capitalized terms have the meanings assigned thereto in this Letter
Agreement, except that the term Seller refers to the Manufacturer and the term
Buyer means the Seller.
QUOTE
1. GUARANTEE
The Maximum Parts Cost Guarantee covers structural parts and systems
listed in Appendix 1 and will include only such parts, subassemblies or
assemblies which are scrapped in the process of maintaining, restoring or
overhauling those A320 Aircraft components categorized as "Rotable" or
"Repairable" items.
1.1 DURATION
The Maximum Parts Cost Guarantee will cover a [****] year period
commencing with delivery of the first A320 Aircraft.
1.2 GUARANTEE
The Seller guarantees that for the first [****] commencing with
delivery of the first A320 Aircraft to the Buyer the Maximum Parts Cost
per flying hour for the maintenance, restoration, and overhaul of the
structural parts and systems defined in Appendix 1 hereto (the
"Guaranteed Material Consumption Cost") will not exceed an average of
US [****] (US dollars--[****]) for the A320 Aircraft in January 1999
delivery conditions. On each anniversary of January 1999, this figure
will be revised in accordance with the Airframe Price Revision Formula.
1.3 ADJUSTMENTS
The Maximum Parts Cost Guarantee is based on an estimated A320 Aircraft
average flight time of 1.4 hours and an average A320 Aircraft usage rate
of 3400 (three thousand four hundred) flying hours per year. Should the
A320 Aircraft average flight time be different from the estimated 1.4
hours, adjustments will be made in accordance with the following formula:
C(G) = (X+YT(F))/T(F) where
C(G) is the guaranteed MPC per flying hours, in US dollars,
X is US$ [****] for the A320 Aircraft per flight cycle,
Y is US$ [****] for the A320 Aircraft per flight hour, and
T(F) is the A320 Aircraft average flight time in hours.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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Should the A320 Aircraft average usage rate be different 3400 (three
thousand four hundred) flying hours by more than ten percent (10%), the
Maximum Parts Cost Guarantee value will be readjusted by mutual agreement.
1.4 REPORTING
The Buyer undertakes to set up, on execution of the A320 Purchase
Agreement, a Consumed Material Cost Accounting System for administration
of this Maximum Parts Cost Guarantee. Reporting and administrative
procedures to implement this Maximum Parts Cost Guarantee will be mutually
agreed between the Buyer and the Seller no later than three (3) months
prior to delivery of the first A320 Aircraft.
1.5 Within one hundred twenty (120) days after the expiration of this Maximum
Parts Cost Guarantee the results of the system Consumed Material Cost will
be summarized. Should the Adjusted Material Consumption Cost per flying
hour (as defined by "C(AN) - C(WN)" below) be equal to or above one
hundred and ten percent (110%) of the Guaranteed Material Consumption Cost
as calculated in accordance with Subparagraph 1.2 above, then, within
ninety (90) days, the Seller will credit the Buyer with an amount L as
defined in the equation below, multiplied by the number of flying hours
accumulated by the A320 Aircraft in the eight-year Maximum Parts Cost
Guarantee period.
L = 0.5 3(R)(N=I) (C(AN) - C(WN) - C(GN))
where:
L: Seller's liability in US dollars per flying hour, summed
over the [****] Maximum Parts Cost Guarantee period,
C(AN): actual direct consumed material purchase price over the
A320 Aircraft fleet in US dollars per flying hour for
each of the [****] in the Maximum Parts Cost
Guarantee period as measured by the Buyer's Consumed
Material Cost Accounting System and as agreed to by the
Seller,
C(WN): value of relevant settlements made under the terms of
all other applied warranties and guarantees under the
A320 Purchase Agreement in US dollars per flying hour
(the Buyer is expected to have pursued and obtained
maximum benefit from all such other warranties and
guarantees offered by the Seller and the Vendors), in
the corresponding year of the Maximum Parts Cost
Guarantee period,
C(AN) - C(WN): Adjusted Material Consumption Cost in US dollars per
flying hour,
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
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C(GN): Guaranteed Maximum Parts Cost per flying hour in US
dollars for each of the [****] in the Maximum
Parts Cost Guarantee period.
With respect to maintenance or repairs subcontracted by the Buyer to, and
performed by, third parties, the actual direct cost or consumed material
will be deemed to be twenty-five percent (25%) of the price to the Buyer
of such maintenance or repairs, if an insufficient breakdown of such
maintenance or repair costs is supplied.
2. This Maximum Parts Cost Guarantee will only apply to parts costs arising
from proper operations, excluding parts costs due to maintenance resulting
from:
- force majeure,
- acts of third parties,
- consequential damages,
- modifications not related to a decrease in consumed material costs,
- negligence, incidental or accidental damage,
- refurbishing work other than in accordance with normal maintenance
practice,
- costs occurring during periods of disruption in operations as
indicated below in Paragraph 8,
- modifications not approved by the Seller.
In addition, the following costs are specifically excluded:
- cost of taxes, duties, transportation, interest, overheads, burden
or other charges which ate not the Seller's responsibility,
- cost of consumable fluids, compounds, paints and cleaning material,
- all handling fees,
3. The Buyer will perform its maintenance operations in strict compliance
with the A320 Aircraft Maintenance and Overhaul Manuals and other written
instructions by the Seller, the Vendors and the regulatory authorities.
The Seller's representatives are hereby authorized by the Buyer to visit
the Buyer's premises to check the application of the Seller's maintenance
procedures and to audit parts cost accounting.
4. If the Seller issues a Service Bulletin that tends to reduce the Adjusted
Material Consumption Cost and the Buyer does not agree to incorporate this
Service Bulletin or agrees to do so only at a later date, then the Seller
will have the right to deduct from the Adjusted Material Consumption Cost
the benefits expected from the incorporation of such modification on the
A320 Aircraft.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA8-4
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5. If during the Maximum Parts Cost Guarantee period, the Buyer contemplates
changes in its Consumed Material Cost Accounting System or maintenance
procedures, the Buyer will notify the Seller at least ninety (90) days
prior to their implementation. The Seller reserves the right to adjust the
Guaranteed Material Consumption Cost if in the Seller's Opinion such
changes affect the basis for the Maximum Parts Cost Guarantee.
Should the Seller so decide, the Seller will notify the Buyer in writing
thirty (30) days prior to implementing such a decision.
6. Reporting of the Buyer's account will occur no later than three (3) months
following each of the Buyer's accounting years and the Buyer will put at
the Seller's disposal any documents, records, books, scrapping tags, etc.
necessary for accounting checks relevant for the purpose of the Maximum
Parts Cost Guarantee.
7. Should the Buyer's Consumed Material Cost Accounting System not provide
for accurate cost reporting of material consumption cost the Maximum Parts
Cost Guarantee value set forth above in Subparagraph 1.2 will be mutually
reviewed and agreed between the Buyer and the Seller.
8. This Maximum Parts Cost Guarantee will be subject to normal maintenance
practices under normal maintenance conditions by good airline operations
standards.
9. Notwithstanding Subparagraph 1.5 above, the liability for damages (and not
as penalty) of the Seller under this Maximum Parts Cost Guarantee will not
exceed a credit of [****] (US dollars--[****]) per Aircraft. The
Seller will make this credit available to the Buyer by way of a credit to
the Buyer's account with Airbus Service Company. Inc.
10. LIABILITY LIMITATION
The Seller's liability for failure to meet the guarantee values will be
governed solely by the terms of this Maximum Parts Cost Guarantee.
UNQUOTE
ASSIGNMENT
In consideration of the assignment and subrogation by the Seller under
this Letter Agreement in favor of the Buyer in respect of the Seller's
rights against and obligations to the Manufacturer under the provisions
quoted above, the Buyer hereby accepts such assignment and subrogation and
agrees to be bound by all of the terms, conditions and limitations therein
contained. The Buyer and Seller recognize and agree that all the
provisions of Clause 12 of the Agreement, including without limitation the
Exclusivity of Warranties and General Limitations of Liability and
Duplicate Remedies therein contained, will apply to the foregoing maximum
parts cost guarantee.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA8-5
<Page>
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph will be void
and of no force or effect,
LA8-6
<Page>
If the foregoing correctly sets forth our understanding. please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA8-7
<Page>
APPENDIX I TO MAXIMUM PARTS COST GUARANTEE
FOLLOWING SYSTEMS ARE COVERED BY THE MAXIMUM PARTS COST GUARANTEE
<Table>
<Caption>
SYSTEM SYSTEM NAME SYSTEM/SUBSYSTEM EXCLUSIONS
NUMBER ----------- ---------------------------
------
<S> <C> <C>
21-00 Air Conditioning None
22-00 Auto Flight None
23-00 Communications 23-33 Passenger Entertainment (Music)
23-34 Passenger Information System
23-35 Pax Facilities--Air-to-Ground Telephone
23-36 Passenger Entertainment (Video)
23-37 Pax Facilities--AM/FM Radio System
23-38 Passenger Services System
24-30 Electrical Power None
25-00 Equipment/Furnishings All
26-00 Fire Protection None
27-00 Flight Control None
28-00 Fuel System None
29-00 Hydraulic Power None
30-00 Ice and Rain None
31-00 Instruments None
32-00 Landing Gear 32-40 Brakes and Wheels*
33-00 Lights None
34-00 Navigation None
35-00 Oxygen None
</Table>
LA8-8
<Page>
APPENDIX I TO MAXIMUM PARTS COST GUARANTEE
FOLLOWING SYSTEMS ARE COVERED BY THE MAXIMUM PARTS COST GUARANTEE
<Table>
<Caption>
SYSTEM NO. SYSTEM NAME SYSTEM/SUBSYSTEM EXCLUSIONS
---------- ----------- ---------------------------
<S> <C> <C>
36-00 Pneumatic None
38-00 Water/Waste None
52-00 Doors None
53-00 Fuselages None
54-00 Nacelles/Pylons None
Structure
55-00 Stabilizers None
56-00 Windows None
57-00 Wing None
71-00 Power Plant General All
73-00 Engine Fuel and Control All
74-00 Ignition All
75-00 Air All
76-00 Engine Controls All
77-00 Engine Indicating All
78-00 Exhaust All
79-00 Oil All
80-00 Starting All
</Table>
LA8-9
<Page>
All
- Buyer Furnished Equipment,
- Seller Furnished Equipment which was changed from Buyer Furnished
Equipment at the Buyer's request,
- Optional Equipment,
are excluded from the Maximum Parts Cost Guarantee.
* The Seller has arranged that, upon request of the Buyer, the brake and
wheel manufacturer(s) will provide a brake and wheel parts cost guarantee
to the Buyer.
LA8-10
<Page>
LETTER AGREEMENT NO. 9
As of April 20, 1999
New Air Corporation
6322 South 3000 East
Suite L-201
Salt Lake City, UT 84121
Re: PERFORMANCE GUARANTEES
Dear Ladies and Gentlemen:
New Air Corporation (the "Buyer") and AVSA, S.A.R.L., (the "Seller"),
have entered into an Airbus A320 Purchase Agreement dated as of even date
herewith (the "Agreement"), which covers, among other things, the sale by the
Seller and the purchase by the Buyer of certain Aircraft, under the terms and
conditions set forth in said Agreement. The Buyer and the Seller have agreed to
set forth in this Letter Agreement No. 9 (the "Letter Agreement") certain
additional terms and conditions regarding the sale of the Aircraft. Capitalized
terms used herein and not otherwise defined in this Letter Agreement will have
the meanings assigned thereto in the Agreement. The terms "herein," "hereof" and
"hereunder" and words of similar import refer to this Letter Agreement.
The Seller has negotiated and obtained the following performance
guarantees from the Manufacturer with respect to the Aircraft, subject to the
terms, conditions, limitations and restrictions all as hereinafter set out. The
Seller hereby assigns to the Buyer and the Buyer hereby accepts all the rights
and obligations of the Seller under the said performance guarantees and the
Seller subrogates to the Buyer all such rights and obligations in respect of the
Aircraft. The Seller hereby warrants to the Buyer that it has all the requisite
authority to make the foregoing assignment and effect the foregoing subrogation
to and in favor of the Buyer and that it will not enter into any amendment of
the provisions so assigned without the prior written consent of the Buyer.
It is understood that in the provisions below between the words QUOTE
and UNQUOTE, capitalized terms have the meanings assigned thereto in this Letter
Agreement, except that the term Seller refers to the Manufacturer and the term
Buyer means the Seller.
LA9-1
<Page>
QUOTE
1. AIRCRAFT CONFIGURATION
The guarantees defined below (the "Guarantees") are applicable to the
Aircraft as described in the Standard Specification, Document
D.000.02000 Issue 5, dated January 30, 1998, as amended by SCNs for the
fitting of the Propulsion Systems (the "Specification" for the purpose
of this Letter Agreement) without taking into account any further
changes thereto as provided in the Agreement.
Notwithstanding the foregoing the Seller will have the right to increase
the design weights above the weights defined in the Specification in
order to satisfy the Guarantees, provided that such increases do not
limit the operational capabilities of the Aircraft.
2. GUARANTEED PERFORMANCE
2.1. TAKE-OFF
FAR take-off field length at an Aircraft gross weight of 162,038 lb at
the start of ground run at sea level pressure altitude in ISA+27 DEG. F
conditions will be not more than a guaranteed value of [****] feet.
2.2. SECOND SEGMENT CLIMB
The Aircraft will meet FAR regulations for one engine inoperative climb
after take-off. undercarriage retracted, at a weight corresponding to
the stated weight at the start of ground run at the altitude and
temperature and in the configuration of flap angle and safety speed
required to comply with the performance guaranteed above in Paragraph
2.1.
2.3 LANDING FIELD LENGTH
FAR certified landing field length at an Aircraft gross weight of
142,197 lb at sea level pressure altitude with zero wind and slope will
be not more than a guaranteed value of [****] feet.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA9-2
<Page>
2.4. SPECIFIC RANGE
2.4.1. The average nautical miles per pound of fuel under the conditions
defined below will be not less than a guaranteed value of [****] nm/lb.
<Table>
<Caption>
WEIGHT ALTITUDE MACH TEMPERATURE
<S> <C> <C> <C>
157,630 lb 33,000 ft 0,78 ISA
148,810 lb 33,000 ft 0.78 ISA
139,990 lb 33,000 ft 0.78 ISA
</Table>
2.4.2. The average nautical miles per pound of fuel under the conditions
defined below will not be less than a guaranteed value of [****] nm/lb.
<Table>
<Caption>
WEIGHT ALTITUDE MACH TEMPERATURE
<S> <C> <C> <C>
157,630 lb 35,000 ft 0.78 ISA
148,810 lb 35,000 ft 0.78 ISA
139,990 lb 35,000 ft 0.78 ISA
</Table>
3. MISSION GUARANTEES
3.1. The Aircraft will be capable of carrying a fixed payload of [****] lb
over a still stage distance of not less than [****] nautical miles when
operated under the conditions defined below:
3.1.1. The departure airport conditions are such as to allow the required
take-off weight to be used without restriction.
The destination airport conditions arc such as to allow the required
landing weight to be used without restriction.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA9-3
<Page>
3.1.2. An allowance of 276 lb of fuel is included for taxi at the departure
airport.
3.1.3. An allowance of 485 lb of fuel is included for take-off and climb to
1,500 ft pressure altitude with acceleration to climb speed at 77 DEG. F
3.1.4. Climb from 1,500 ft pressure altitude up to cruise altitude using
maximum climb thrust and cruise at a fixed Mach number of M=0.78 at
pressure altitudes of 35,000 ft and descent to 1,500 ft pressure
altitude are conducted in ISA+18 DEG. F conditions. Climb and descent
speeds below 10,000 ft will be 250 knots CAS.
3.1.5. An allowance of 199 lb of fuel is included for approach and landing at
the destination airport.
3.1.6. Stage distance is defined as die distance covered during climb, cruise
and descent as described above in Paragraph 3.1.4.
3.1.7. At the end of approach and landing, 7,364 lb of fuel will remain in the
tanks. This represents the estimated fuel required for:
1) 45 minutes continued cruise
2) Missed approach
3) Diversion in ISA+18 DEG. F conditions over a distance of
200 nautical miles starting and ending at 1,500 feet
pressure altitude.
4) Approach and landing at the diversion airport
3.2. OPERATING WEIGHT EMPTY
The guaranteed mission range defined above in Paragraph 3.1 is based on
a fixed estimated Operating Weight Empty of [****].
4. MANUFACTURER'S WEIGHT EMPTY GUARANTEE
The Seller guarantees a Manufacturer's Weight Empty of 84,655 lb plus
1.5%. This is the Manufacturers Weight Empty as defined in Section
13-10.00.00 of the Specification and is subject to adjustment as defined
below in Paragraph 7.2.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA9-4
<Page>
5. GUARANTEE CONDITIONS
5.1. The performance certification requirements for the Aircraft, except
where otherwise noted, will be as stated in Section 02 of the
Specification.
5.2. For the determination of FAR take-off and landing performance, a hard
level dry runway surface with no runway strength limitations, no
obstacles, zero wind, atmosphere according to ISA, except as otherwise
noted, and the use of speedbrakes, flaps, landing gear and engines in
the conditions liable to provide the best results will be assumed.
5.3. When establishing take-off and second segment performance, no air will
be bled from the engines for cabin air conditioning or anti-icing.
5.4. When establishing the approach climb performance, cabin air conditioning
will be operative with an average ventilation rate not less than the
amount defined in the Specification, but no air will be bled from the
engines for anti-icing.
5.5. The en-route one engine inoperative climb performance will be
established with the amount of engine air bleed associated with the
maximum cabin altitude as specified in Section 21-30.32 of the
Specification and an average ventilation rate not less than the amount
defined in the Specification, but no air will be bled from the engines
for anti-icing.
5.6. Climb, cruise and descent performance associated with the Guarantees
will include allowances for normal electrical load and for normal engine
air bleed and power extraction associated with maximum cabin
differential pressure as defined in Section 21-30.31 of the
Specification. Cabin air conditioning management during performance
demonstration as described below in Paragraph 6.3 may be such as to
optimize the Aircraft performance, while meeting the minimum air
conditioning requirements defined above. Unless otherwise stated, no air
will be bled from the engines for anti-icing.
5.7. The engines will be operated using not more than the engine
manufacturer's maximum recommended outputs for take-off, maximum
go-round, maximum continuous, maximum climb and cruise for normal
operation, unless otherwise stated.
5.8. Where applicable, the Guarantees assume the use of an approved fuel
having a density of 6.7 lb/USgal and a tower heating value of 18,590
BTU/lb.
LA9-5
<Page>
6. GUARANTEE COMPLIANCE
6.1. Compliance with the Guarantees will be demonstrated using operating
procedures and limitations in accordance with those defined first by the
FAA and second by the Seller unless otherwise stated.
6.2. Compliance with the take-off, second segment and landing elements of the
Guarantees will be demonstrated with reference to the FAA approved
Flight Manual.
6.3. Compliance with those parts of the Guarantees not covered by the
requirements of the FAA will be demonstrated by calculation, based on
data obtained during flight tests conducted on one (or more, at the
Seller's discretion) A320-200 aircraft of the same aerodynamic
configuration as the Aircraft.
6.4. Compliance with the Manufacturer's Weight Empty Guarantee will be
demonstrated with reference to a weight compliance report.
6.5. Data derived from tests will be adjusted as required using conventional
methods of correction, interpolation or extrapolation in accordance with
established aeronautical practices to show compliance with the
Guarantees.
6.6. Compliance with the Guarantees is not contingent on engine performance
defined in the Propulsion System manufacturer's specification.
6.7. The Seller undertakes to furnish the Buyer with a report or reports
demonstrating compliance with the Guarantees at, or as soon as possible
after, the delivery of each of the Aircraft.
7. ADJUSTMENT OF GUARANTEES
7.1. In the event that any change to any law, governmental regulation or
requirement or interpretation thereof ("Rule Change") by any
governmental agency made subsequent to the date of the Agreement affects
the Aircraft configuration or performance or both required to obtain
certification, the Guarantees will be appropriately modified to reflect
the effect of such Rule Change.
7.2. The Guarantees apply to the Aircraft, as described above in Paragraph 1,
may be adjusted in the event of
a) any further configuration change that is the subject of
an SCN,
b) variation in actual weights of items defined in Section
13-10 of the Specification,
LA9-6
<Page>
c) changes required to obtain certification that cause
changes to the performance or weight of the Aircraft
8. EXCLUSIVE GUARANTEES
The Guarantees are exclusive and are provided in lieu of any and all
other performance, weight and noise guarantees of any nature that may be
stated, referenced or incorporated in the Specification or any other
document (but without prejudice to the obligations of the Seller under
the Agreement to build the Aircraft in accordance with the
Specification, including, without limitation, specifications regarding
performance, weight and noise requirements).
9. UNDERTAKING REMEDIES
9.1. Should any Aircraft fail to meet any of the Guarantees specified in this
Letter Agreement, the Seller will endeavor to correct the deficiency to
comply with the subject guarantee in a cost-effective manner.
9.2. Should the Seller fail to develop and make available corrective means
(including but not limited to kits, procedures, adjustment of design
weights) for the above said deficiency within one (1) year from
Delivery, then the Seller will pay liquidated damages to the Buyer.
Subject to the terms of Paragraph 9.3 below, in respect of the concerned
Aircraft, the Seller will pay the following liquidated damages to the
Buyer on the anniversary of the delivery Date for as long as the
deficiency remains:
(i) US$ [****] (US dollars--[****]) per one
percent deficient per Aircraft per year based on the
deficiency expressed as a percentage of the specific
range Guarantee or mission range Guarantee (part of a
percent to be prorated).
(ii) US$ [****] (US dollars--[****]) per pound deficient per
Aircraft per year based on thc deficiency expressed in
pounds of the Manufacturer's Weight Empty Guarantee.
9.3. The Seller's maximum liability in respect of a deficiency in performance
of any Aircraft will be limited to the payment of liquidated damages
for a period of not more than five (5) years, up to an aggregate value
of US$ [****] (US dollars--[****]) for each deficient
Aircraft, whichever occurs first. Payment of liquidated damages will be
deemed to settle all and any claims and remedies the Buyer would have
against the Seller in respect of performance deficiencies.
UNQUOTE
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA9-7
<Page>
In consideration of the assignment and subrogation by the Seller under
this Letter Agreement in favor of the Buyer in respect of the Seller's
rights against and obligations to the Manufacturer under the provisions
quoted above, the Buyer hereby accepts such assignment and subrogation
and agrees to be bound by all of the terms, conditions and limitations
therein contained. The Buyer and Seller recognize and agree that, except
as otherwise expressly provided in Paragraph 8 of this Letter Agreement,
all the provisions of Clause 12 of the Agreement, including without
limitation the Exclusivity of Warranties and General Limitations of
Liability and Duplicate Remedies therein contained, will apply to the
foregoing performance guarantees.
ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement, and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner
without the prior written consent of the Seller, and any attempted
assignment or transfer in contravention of the provisions of this
Paragraph will be void and of no force or effect.
LA9-8
<Page>
If the foregoing correctly sets forth our understanding. please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
Very truly yours,
AVSA, S.A.R.L.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
New Air Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 4-20-99
--------------------------
LA9-9
<Page>
LETTER AGREEMENT NO. 10
As of October __, 1999
JetBlue Airways Corporation
6322 South 3000 East
Suite G-10
Salt Lake City, UT 84121
Re: SPECIAL ASSISTANCE
Dear Ladies and Gentlemen:
JetBlue Airways Corporation (formerly known as New Air Corporation) (the
"Buyer") and AVSA, S.A.R.L., (the "Seller"), have entered into an Airbus A320
Purchase Agreement dated as of April 20, 1999, (the "Agreement") which covers,
among other things, the sale by the Seller and the purchase by the Buyer of
certain Aircraft, under the terms and conditions set forth in said Agreement.
The Buyer and the Seller have agreed to set forth in this Letter Agreement No.
10 (the "Letter Agreement") certain additional terms and conditions regarding
the sale of the Aircraft. Capitalized terms used herein and not otherwise
defined in this Letter Agreement will have the meanings assigned thereto in the
Agreement. The terms "herein," "hereof" and "hereunder" and words of similar
import refer to this Letter Agreement.
Both parties agree that this Letter Agreement will constitute an integral,
nonseverable part of said Agreement, that the provisions of said Agreement are
hereby incorporated herein by reference, and that this Letter Agreement will be
governed by the provisions of said Agreement, except that if the Agreement and
this Letter Agreement have specific provisions which are inconsistent, the
specific provisions contained in this Letter Agreement will govern.
1. [****]
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA10-1
<Page>
[****]
(b) [****]
(c) [****]
(d) [****]
2. ASSIGNMENT
Notwithstanding any other provision of this Letter Agreement or of the
Agreement, this Letter Agreement and the rights and obligations of the
Buyer hereunder will not be assigned or transferred in any manner without
the prior written consent of the Seller, and any attempted assignment or
transfer in contravention of the provisions of this Paragraph 2 will be
void and of no force or effect.
----------
[****] Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
LA10-2
<Page>
If the foregoing correctly sets forth our understanding, please execute
the original and one (1) copy hereof in the space provided below and return a
copy to the Seller.
By: illegible
------------------------------
Its:
-----------------------------
Date:
----------------------------
Accepted and Agreed
JetBlue Airways Corporation
By: /s/ David Neeleman
----------------------------
Its: CEO
---------------------------
Date: 11-4-99
--------------------------
LA10-3