1
EXHIBIT 10(b)
PURCHASE AGREEMENT
NO. P.A.-0430
BETWEEN
BOMBARDIER INC.
AND
ATLANTIC SOUTHEAST AIRLINES, INC.
RELATING TO THE PURCHASE OF
TWELVE (12) CANADAIR REGIONAL JET SERIES 700 AIRCRAFT
INCLUDING RELATED CUSTOMER SUPPORT SERVICES
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TABLE OF CONTENTS
-----------------
ARTICLE
1 INTERPRETATION
2 SUBJECT MATTER OF SALE
3 CUSTOMER SUPPORT SERVICES AND WARRANTY
4 PRICE
5 PAYMENT
6 DELIVERY PROGRAM
7 BUYER INFORMATION
8 CERTIFICATION FOR EXPORT
9 ACCEPTANCE PROCEDURE
10 TITLE AND RISK
11 CHANGES
12 BUYER'S REPRESENTATIVES AT MANUFACTURE SITE
13 EXCUSABLE DELAY
14 NON-EXCUSABLE DELAY
15 LOSS OR DAMAGE
16 TERMINATION
17 NOTICES
18 INDEMNITY AGAINST PATENT [*
]
19 LIMITATION OF LIABILITY
20 ASSIGNMENT
21 SUCCESSORS
22 APPLICABLE LAWS
23 CONFIDENTIAL NATURE OF AGREEMENT
24 AGREEMENT
APPENDIX
I ECONOMIC ADJUSTMENT FORMULA
II DELIVERY SCHEDULE
III SPECIFICATION
IV BUYER SELECTED OPTIONAL FEATURES
EXHIBIT
I CERTIFICATE OF ACCEPTANCE
II ▇▇▇▇ OF SALE
III CERTIFICATE OF RECEIPT OF AIRCRAFT
IV CHANGE ORDER
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ANNEX A CUSTOMER SUPPORT SERVICES
ANNEX B WARRANTY AND SERVICE LIFE POLICY
LETTER AGREEMENTS
LA 0430-01
LA 0430-02
LA 0430-03
LA 0430-04
LA 0430-05
LA 0430-06
LA 0430-07
LA 0430-08
LA 0430-09
LA 0430-10
LA 0430-11
LA 0430-12
LA 0430-13
LA 0430-14
LA 0430-15
LA 0430-16
LA 0430-17
LA 0430-18
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This Agreement is made on the 3rdth day of September 1998.
BY AND BETWEEN: BOMBARDIER INC. ("Bombardier"), a Canadian corporation
through Bombardier Aerospace Regional Aircraft having an
office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇.
AND: ATLANTIC SOUTHEAST AIRLINES, INC. ("Buyer"), a Georgia
corporation having an office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇.▇.▇.
WHEREAS Bombardier is engaged in the manufacture of the Canadair
Regional Jet Series 700 aircraft and related products and
provides marketing, sales and customer support services for
the Canadair Regional Jet Series 700 aircraft and related
products;
WHEREAS Buyer desires to purchase twelve (12) Aircraft (as later
defined) and related data, documents, and services under this
Agreement (as later defined), and Bombardier desires to
arrange for the sale of such Aircraft, data, documents and
services to Buyer,
NOW THEREFORE, in consideration of the mutual covenants herein contained, Buyer
and Bombardier agree as follows:
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ARTICLE 1 - INTERPRETATION
1.1 The recitals above have been inserted for convenience only and do not
form part of this Agreement (as defined hereafter).
1.2 The headings in this Agreement are included for convenience only and
shall not be used in the construction and interpretation of this
Agreement.
1.3 In this Agreement, unless otherwise expressly provided or the context
otherwise requires, the singular includes the plural and vice-versa.
1.4 In this Agreement the following expressions shall, unless otherwise
expressly provided, mean:
"Acceptance Period" shall have the meaning attributed to it in Article
9.3;
"Acceptance Date" shall have the meaning attributed to it in Article
9.7 (a);
"Agreement" means this Purchase Agreement P.A.-0430, including all
Exhibits, Annexes, Appendices and Letter Agreements attached hereto
(each of which is incorporated in this Purchase Agreement P.A.-0430 by
this reference), as they may be amended pursuant to the provisions of
this Purchase Agreement P.A.-0430;
"Aircraft" shall have the meaning attributed to it in Article 2.1;
"Aircraft Purchase Price" shall have the meaning attributed to it in
Article 4.2;
"Base Price" shall have the meaning attributed to it in Article 4.1;
"▇▇▇▇ of Sale" shall have the meaning attributed to it in Article 9.7
(c);
"[* ]" shall have the meaning attributed to it in Article 13.2;
"Buyer Furnished Equipment" or "BFE" shall have the meaning attributed
to it in Article 7.2;
"[* ]" shall have the meaning attributed to it in Article 8.5;
"Buyer Selected Optional Features" shall have the meaning attributed
to it in Article 2.1;
"Competitor of Bombardier" shall be any person who, directly, or
indirectly through its affiliates, has substantial operations related
to the design, development, manufacture and marketing of aerospace
products;
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"Delivery Date" shall have the meaning attributed to it in Article 9.7
(c);
"Economic Adjustment Formula" shall have the meaning attributed to it
in Article 4.2;
"Excusable Delay" shall have the meaning attributed to it in Article
13.1;
"FAA" shall mean the Federal Aviation Administration of the United
States including any Governmental agency of the United States
succeeding to the authority and jurisdiction of the Federal Aviation
Administration;
"Net Purchase Aircraft Price" shall have the meaning attributed to it
in Letter Agreement 0430-13;
"Non-Excusable Delay" shall have the meaning attributed to it in
Article 14.1;
"Notice" shall have the meaning attributed to it in Article 17.1;
"Other Patents" shall have the meaning attributed to it in Article
18.1;
"Original Scheduled Delivery Date" shall mean the earlier of (i) the
last business day of the month containing the applicable Scheduled
Delivery Date of an Aircraft or (ii) the Readiness Date (which shall
be within the month of the applicable Scheduled Delivery Date)
established pursuant to Article 9.1. (e) for such Aircraft;
"Permitted Change" shall have the meaning attributed to it in Article
11.2;
"Prime Rate" shall be the U.S. prime rate designated as such and
charged by The Chase Manhattan Bank from time to time;
"Readiness Date" shall have the meaning attributed to it in Article
9.1. (e);
"Regulatory Change" shall have the meaning attributed to it in Article
8.4;
"Scheduled Delivery Dates" shall have the meaning attributed to it in
Article 6.1;
"Specification" shall have the meaning attributed to it in Article 2.1;
"Successor in Interest" shall mean any entity succeeding in interest
to a party hereto as a result of a merger, stock sale,
recapitalization, reorganization, consolidation, or sale of all or
substantially all of the assets of said party;
"Taxes" shall have the meaning attributed to it in Article 4.3; and
"TC" shall have the meaning attributed to it in Article 8.1.
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1.5 All dollar amounts in this Agreement are in United States Dollars.
1.6 All capitalized terms not expressly defined under this Article 1 and
used elsewhere in this Agreement shall have the meanings ascribed to
such capitalized terms elsewhere herein.
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ARTICLE 2 - SUBJECT MATTER OF SALE
2.1 Subject to the provisions of this Agreement, Bombardier will sell and
Buyer will purchase twelve (12) Canadair Regional Jet Series 700
aircraft model CL-600-2C10 manufactured pursuant to preliminary type
specification No. RAD-670-113 Issue NC dated August 28, 1998, attached
hereto as Appendix III, as that specification may be modified from
time to time in accordance with this Agreement (the "Specification"),
reflecting the incorporation of the Buyer selected optional features
("Buyer Selected Optional Features") set forth in Appendix IV hereto
(collectively the "Aircraft").
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ARTICLE 3 - CUSTOMER SUPPORT SERVICES AND WARRANTY
3.1 Bombardier shall provide to Buyer the customer support services
pursuant to the provisions of Annex A attached hereto.
3.2 Bombardier shall provide to Buyer the warranty and the service life
policy described in Annex B attached hereto.
3.3 Except as expressly stated in Annex A or Annex B, the services
referred to in 3.1 and 3.2 above are incidental to the sale of the
Aircraft and are included in the Aircraft Purchase Price.
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ARTICLE 4 - PRICE
4.1 (a) The base price for each of the Aircraft (excluding the Buyer
Selected Optional Features) is based on Bombardier delivering
the Aircraft to Buyer at Bombardier's facilities in Dorval,
Quebec and is [*
] expressed in [* ] dollars.
(b) The base price of the Buyer Selected Optional Features is [*
] expressed in [* ] dollars.
The Aircraft base price shall be the base price for the Aircraft as
stated in paragraph (a), plus the base price of the Buyer Selected
Optional Features as stated in paragraph (b) ("Base Price").
4.2 The price of the Aircraft shall be the Base Price adjusted for changes
made pursuant to Article 11.1, if any, and [* ] if any, and further
adjusted to reflect economic fluctuations during the period from [* ]
to the Delivery Date (or such other date expressly provided herein) of
each Aircraft except to the extent all or any portion of such
adjustment is not applicable as expressly provided elsewhere herein
("Aircraft Purchase Price"). Such adjustments shall be calculated in
accordance with the economic adjustment formula attached as Appendix I
("Economic Adjustment Formula").
4.3 The Aircraft Purchase Price does not include any taxes, fees or duties
including, but not limited to, sales, use, value added (including the
Canadian Goods and Services Tax), personal property, gross receipts,
franchise, excise taxes, assessments or duties ("Taxes") which are or
may be imposed by law upon Bombardier, any affiliate of Bombardier,
Buyer or the Aircraft whether or not there is an obligation for
Bombardier to collect same from Buyer, by any taxing authority or
jurisdiction occasioned by, relating to or as a result of the
execution of this Agreement or the sale, lease, delivery, storage, use
or other consumption of any Aircraft, BFE or any other matter, good or
service provided under or in connection with this Agreement.
4.4 Upon Bombardier's request, Buyer shall execute and deliver to
Bombardier any documents that Bombardier deems necessary or desirable
in connection with any exemption from or reduction of or the
contestation of or the defense against any imposition of Taxes,
provided that, such execution and delivery of said documents does not
prejudice Buyer's rights. Upon Buyer's request, Bombardier shall
execute and deliver to Buyer any documents that Buyer deems necessary
or desirable in connection with any exemption from or reduction of or
the contestation of or the defense against any imposition of Taxes,
provided that, such execution and delivery of said documents does not
prejudice Bombardier's rights.
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ARTICLE 5 - PAYMENT
5.1 Intentionally left blank.
5.2 Buyer shall make payment or cause payment to be made of the [* ]
Purchase Price for each Aircraft on delivery of such Aircraft.
5.3 Should Buyer fail to make the required [* ]
of this Agreement on or before the stipulated date and [*
], this Agreement shall
automatically terminate and Bombardier shall have no further
obligation to Buyer with respect to undelivered Aircraft, including
the obligation to proceed further with the manufacture of the Aircraft
on behalf of Buyer or the sale and/or delivery of the Aircraft to
Buyer [* ].
Bombardier shall have the option (but not the obligation) of waiving
such termination should Buyer make arrangements satisfactory to
Bombardier for such payment and all future payments within ten (10)
calendar days of termination.
5.4 Buyer shall pay Bombardier simple daily interest on late payments,
from the date that any payment becomes due up to and including the day
prior to receipt of payment, at a rate of [*
], calculated and compounded annually.
Bombardier's right to receive such interest is in addition to any
other right or remedy (other than the right or remedy to be paid
interest) Bombardier has at law as a result of Buyer's failure to make
payments when due.
5.5 Buyer shall make all payments due from Buyer to Bombardier under this
Agreement in immediately available funds by deposit on or before the
due date to Bombardier's account in the following manner:
(a) Transfer to: [* ]
(b) Beneficiary: [* ]
(c) For further credit to: [* ]
5.6 All other amounts due, as agreed to by the parties, with respect to
each Aircraft shall be paid on or prior to the Delivery Date of the
respective Aircraft.
5.7 All payments provided for under this Agreement shall be made so as to
be received in immediately available funds on or before the dates
stipulated herein.
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5.8 Bombardier shall remain the exclusive owner of the Aircraft, free and
clear of all rights, liens, charges or encumbrances created by or
through Buyer, until such time as all payments referred to in this
Article 5 have been made.
5.9 Any payment or refund that might be due from Bombardier to Buyer under
this Agreement shall be made in immediately available funds by deposit
on or before the due date to Buyer's account in the following manner:
Bank Name: [* ]
For credit of: [* ]
Account No.: [* ]
ABA # [* ]
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ARTICLE 6 - DELIVERY PROGRAM
6.1 The Aircraft shall be offered for inspection and acceptance to Buyer
at Bombardier's facility in Dorval, Quebec during the months set forth
in Appendix II attached hereto as same may be modified from time to
time by Change Order or other amendment in accordance with the terms
of this Agreement (the "Scheduled Delivery Dates").
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ARTICLE 7 - BUYER INFORMATION
7.1 During the manufacture of the Aircraft, Buyer shall provide to
Bombardier at least [* ]
prior to the Scheduled Delivery Date of the first Aircraft all
information as Bombardier may reasonably request to manufacture the
Aircraft including, without limitation, the selection of furnishings,
internal and external colour schemes.
Buyer shall provide Bombardier with an external paint scheme and
internal colours agreed on by the parties.
7.2 Buyer shall notify Bombardier in writing [* ] prior to the Scheduled
Delivery Date of the first Aircraft of the Buyer Furnished Equipment
("BFE") (if any) that Buyer wishes to have incorporated into each
Aircraft. Buyer shall also provide details of:
a. weights and dimensions of the BFE;
b. test equipment or special tools required to incorporate the
BFE;
c. any other information Bombardier may reasonably require; and
d. the proper storage, fitment, servicing, maintenance,
operation and availability of test equipment or special tools
needed for the BFE.
Within [* ] thereafter, Bombardier shall advise Buyer of its
acceptance or rejection of the BFE, of the dates by which each item of
BFE is required by Bombardier and of the first succeeding Aircraft
delivery in which the BFE can be incorporated. If required, the
parties hereto shall execute a Change Order in accordance with this
Article to cover those BFE items accepted by Bombardier pursuant to
Article 7.2.
7.3 The BFE accepted by Bombardier pursuant to Article 7.2 shall be
incorporated in the manufacturing process of the Aircraft subject to
the following conditions:
a. The BFE must be received F.O.B. Bombardier's plant or such
other place as Bombardier may designate, no later than the
date agreed upon between Buyer and Bombardier, free and clear
of any taxes, duties, licenses, charges, liens or other
similar claims;
b. The BFE shall meet:
1) the standards of quality of Bombardier, and
2) the requirements of the applicable airworthiness
certification agency;
c. The BFE shall be delivered to Bombardier in good condition
and ready for immediate incorporation into the Aircraft.
Bombardier shall, upon receipt, inspect the BFE as to quality
and apparent defects and inform Buyer of any discrepancies
and any required corrective actions to be taken;
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d. Bombardier shall only be responsible for the fitment and
testing of the BFE in the Aircraft (with the exception of any
BFE that may be installed by Buyer on the Aircraft after
delivery of same to Buyer which shall remain the
responsibility of Buyer) using reasonable care and good
manufacturing practices, in accordance with Buyer's written
detailed description of the dimensions and weight of such
BFE.
7.4 If at any time between receipt of the BFE by Bombardier and the
Delivery Date for any Aircraft in which such BFE is to be
incorporated, it is mutually agreed that an item of BFE supplied does
not meet the standards and requirements of Article 7.3 or its fitment,
integration and testing in the Aircraft or Aircraft systems create
delays in the manufacturing or certification process, then such BFE
shall be removed and replaced by other BFE or by Bombardier's
equipment unless Buyer requests delivery of the Aircraft without
inclusion of such BFE. Any costs associated with the removal,
refitment, replacement, testing and/or certification of the BFE and
the price of the equipment provided in substitution for any BFE by
Bombardier, if applicable, shall be borne by Buyer.
7.5 In the event that delivery of an Aircraft in which BFE is to be
incorporated is delayed due to any delay caused by Buyer's failure to:
a. deliver, or have the applicable BFE delivered by the date
required;
b. ensure satisfactory operation of the applicable BFE;
c. furnish or obtain applicable BFE data;
d. perform any adjusting, calibrating, retesting or updating of
applicable BFE;
e. furnish or obtain any approvals in compliance with the
provisions of this Article; or
f. comply with the conditions of Article 7.1 and/or 7.3;
Bombardier agrees to discuss with Buyer and, where appropriate, agree
with Buyer on the steps to be taken to minimize, cure, eliminate or
work around the delay, but any delay incurred shall be the
responsibility of Buyer and Buyer shall pay to Bombardier any costs
and expenses reasonably incurred by Bombardier due to such delay.
7.6 Title to the BFE shall remain at all times with Buyer and risk of loss
of the BFE shall remain at all times with Buyer, [* ].
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7.7 If this Agreement is terminated in whole or in part in accordance with
the provisions of this Agreement, Bombardier may elect to, by written
notice to Buyer, either:
a. purchase the BFE ordered by Buyer and/or received by
Bombardier at the invoice price paid by Buyer; or
b. return the BFE to Buyer FOB Bombardier's plant, or such other
place to which the BFE was delivered pursuant to Article 7.3
a. above.
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ARTICLE 8 - CERTIFICATION FOR EXPORT
8.1 Bombardier shall, prior to the delivery of the first Aircraft, obtain
from Transport Canada ("TC"), a TC Type Approval (Transport Category)
and from the FAA an FAA Type Certificate for the type of aircraft
purchased under this Agreement.
8.2 Bombardier shall provide to Buyer a TC Certificate of Airworthiness
(Transport Category) for export, on or before the Delivery Date of
each Aircraft, which will bear a statement of compliance with the type
certificate which will make such Aircraft immediately eligible for the
issuance of and enable Buyer to obtain an FAA Certificate of
Airworthiness for such Aircraft.
8.3 Bombardier shall not be obligated to obtain any certificates or
approvals as part of this Agreement other than those specified in 8.1
and 8.2 above or in any other provision of this Agreement expressly
providing that Bombardier provide a certificate or approval. The
obtaining of any import license or authority required to import or
operate the Aircraft into any country outside of Canada shall be the
responsibility of Buyer. Bombardier shall, to the extent permitted by
law, and with Buyer's assistance, seek the issuance of a Canadian
export license to enable Buyer to export the Aircraft from Canada
subject to prevailing export control regulations in effect on the
Delivery Date.
8.4 If any addition to, or change to, or modification to, or testing of,
an Aircraft is required or will be required by the passage of time by
any change in law or governmental regulation or requirement (including
without limitation an airworthiness directive) or interpretation
thereof by any governmental agency having jurisdiction, including,
without limitation, the FAA, in order to meet the requirements of
Article 8.2 and occurring before, on or after the date hereof but
prior to delivery of an Aircraft (a "Regulatory Change"), unless
otherwise provided by this Agreement, [*
] to the affected Aircraft on or prior to the deadline for
accomplishing such Regulatory Change provided that in discharging its
obligations hereunder [*
].
8.5 A Regulatory Change shall be made by Bombardier [* ]
unless such Regulatory Change is a "[* ]".
As used herein, a [* ]
shall mean any [*
]
which either (a) is imposed by the [* ] or any governmental
division of [* ] and applicable to all
aircraft in general or to all aircraft of the same category as the
Aircraft or (b) is imposed by the [* ] or any governmental
division of the [* ] and is
[* ]. [* ] shall be
responsible for [* ] reasonable price for making such [*
] an Aircraft.
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8.6 Bombardier shall issue a Change Order (as hereinafter defined),
reflecting any Regulatory Change required to be made under this
Article 8, which shall set forth in detail the particular changes to
be made and the effect, if any, of such changes on design,
performance, weight, balance, time of delivery, and, for [* ], on the
[* ]and [* ]. Any Change Orders issued pursuant to this Article shall
be effective and binding from the date of Bombardier's transmittal of
such Change Order. Although Buyer's consent to said Change Order is
not required, Bombardier agrees to consult with Buyer regarding the
change proposed by Bombardier to implement such Regulatory Change.
8.7 If the use of any of the certificates identified in this Article 8 are
discontinued during the performance of this Agreement, reference to
such discontinued certificate shall be deemed a reference to any other
certificate or instrument which corresponds to such certificate or, if
there should not be any such other certificate or instrument, then
Bombardier shall be deemed to have obtained such discontinued
certificate(s) upon demonstrating that the Aircraft complies with the
Specification.
8.8 Reference to a regulatory authority shall include any succeeding
department or agency then responsible for the duties of said
regulatory authority.
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ARTICLE 9 - ACCEPTANCE PROCEDURE
9.1 Bombardier shall:
(a) reconfirm the Scheduled Delivery Date [* ] of
each Aircraft to Buyer not later than [* ]
prior to the Scheduled Delivery Date of the first Aircraft
provided that such reconfirmation shall not alter Appendix
II. Bombardier shall reconfirm the Scheduled Delivery Date [*
] of each Aircraft to Buyer not later than [*
] prior to the Scheduled Delivery Date of
the first Aircraft; provided that (1) all such reconfirmed
Scheduled Delivery Dates [* ] shall be consistent with
those [* ] originally provided under
Appendix II and (2) upon such reconfirmation, the parties
shall [*
] for each Aircraft as provided under such
reconfirmation.
(b) conduct CRJ-700 program reviews with Buyer, no more
frequently than [* ], to provide information concerning the
status and progress related to the [*
].
(c) give Buyer at least [* ] advance notice of the
projected two (2) weeks during which each Aircraft may be
ready for inspection and delivery.
(d) give Buyer at least [* ] advance notice of the
projected date of readiness of each Aircraft for inspection
and delivery.
(e) give Buyer at least [* ] advance notice
of the date on which an Aircraft will be ready for Buyer's
inspection, flight test and acceptance (the "Readiness
Date"). Bombardier shall provide Buyer, coincident with the
[* ] notice establishing the
Readiness Date, written notice of [*
] due on delivery of such Aircraft, which notice
shall contain evidence of the appropriate calculations
supporting such amount.
9.2 Within two (2) days following receipt by Buyer of the notice of
Readiness Date, Buyer shall:
(a) provide notice to Bombardier as to the source and method of
payment of the [*
];
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(b) identify to Bombardier the names of Buyer's representatives
who will participate in the inspection, flight test and
acceptance; and
(c) provide evidence of the authority of the designated persons
to execute the Certificate of Acceptance and other delivery
documents on behalf of Buyer.
9.3 Buyer shall have three (3) consecutive working days commencing on the
Readiness Date in which to complete the inspection and flight test
(such three (3) working day period being the "Acceptance Period").
9.4 Up to four (4) representatives of Buyer may participate in Buyer's
ground inspection of the Aircraft and two (2) representatives of Buyer
may participate in the flight tests, provided that, at least one of
such representative's, duly and properly endorsed, shall be entitled
to sit in the cockpit of the Aircraft during such flight test.
Bombardier shall, if requested by Buyer, perform an acceptance flight
of not less than one (1) and not more than three (3) hours duration.
Ground inspection and flight tests shall be conducted in accordance
with those acceptance procedures to be mutually agreed upon by the
parties and, except for Buyer's representative's travel and living
expenses, [* ].
Such acceptance procedures to be agreed upon no later than [* ]
prior to the Scheduled Delivery Date of the first Aircraft. At all
times during ground inspection and flight test, Bombardier shall
retain control over the Aircraft. The agreed acceptance testing
procedures shall be sufficient to reasonably demonstrate the
Aircraft's compliance with the Specifications and, subject to the
following sentence, the [*
]. Buyer shall be entitled to require on ten (10) days prior
written notice to Bombardier, [*
]
on (a) each of [* ]
delivered hereunder, (b) every [* ] thereafter delivered
hereunder, and (c) on any Aircraft to be delivered hereunder [*
]. Bombardier
shall, in connection with and for purposes of Buyer's participation in
such ground inspection and flight test, cause [* ]
and shall cause [*
] and shall furnish [*
].
9.5 If no Aircraft defect or discrepancy is revealed during the ground
inspection or flight test, Buyer shall accept the Aircraft on or
before the last day of the Acceptance Period in accordance with the
provisions of Article 9.7.
9.6 If any material defect or discrepancy in the Aircraft is revealed by
Buyer's ground inspection or flight test, the defect or discrepancy
will promptly be corrected by Bombardier, at no cost to Buyer, which
correction may occur during or after the Acceptance Period depending
on the nature of the defect or discrepancy and of the time required
for correction provided, that, Bombardier will use its good faith
efforts to correct
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any such defect or discrepancy on or before expiration of the
Acceptance Period and allowing sufficient time before such expiration
to permit the conduct of additional test flights. To the extent
necessary to verify such correction, Bombardier shall perform one (1)
or more further acceptance flights. Should such correction cause the
delivery of the Aircraft to be postponed to the succeeding month, the
[*
].
9.7 Upon completion of the ground inspection and acceptance flight of the
Aircraft and correction of any defects or discrepancies:
(a) Buyer will sign a Certificate of Acceptance (in the form of
Exhibit I hereto) for the Aircraft. Execution of the
Certificate of Acceptance by or on behalf of Buyer shall be
evidence of Buyer having examined the Aircraft and found it
in accordance with the provisions of this Agreement. The date
of signature of the Certificate of Acceptance shall be the
"Acceptance Date";
(b) Bombardier will supply a TC Certificate of Airworthiness for
Export and all other documentation or other evidence required
under Article 8.2 of this Agreement;
(c) Buyer shall pay Bombardier the balance of the [* ] and any
other amounts agreed by the parties that are due, at which
time Bombardier shall issue an FAA ▇▇▇▇ of sale and a full
warranty ▇▇▇▇ of sale (in the form of Exhibit II hereto)
passing to Buyer good title to the Aircraft free and clear of
all liens, claims, charges and encumbrances except for those
liens, charges or encumbrances created by or claimed through
Buyer (collectively the "▇▇▇▇ of Sale"). The date on which
Bombardier delivers the ▇▇▇▇ of Sale and Buyer takes delivery
of the Aircraft shall be the "Delivery Date" for such
Aircraft; and
(d) Unless waived by Buyer, Bombardier shall supply a legal
opinion opining on due authorization, execution and delivery
of the Warranty ▇▇▇▇ of Sale and that the Warranty ▇▇▇▇ of
Sale is legal, valid and a binding obligation of Bombardier,
in accordance with its terms. The legal opinion shall be in a
form to be mutually satisfactory and agreed upon by the
parties within ten (10) days after the execution and delivery
of this Agreement and may be provided in whole or in part by,
or in reliance on an opinion issued by a duly admitted lawyer
employed by the legal department of Bombardier.
Delivery of the Aircraft shall be evidenced by the execution and
delivery of the ▇▇▇▇ of Sale and of the Certificate of Receipt of
Aircraft (in the form of Exhibit III hereto).
9.8 Provided that Bombardier has met all of its obligations under this
Article 9, should Buyer not accept, pay for and take delivery of any
of the Aircraft within [*
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] after the end of the Acceptance Period of
such Aircraft, Buyer shall be deemed to be in default of the terms of
this Agreement.
9.9 Provided that Bombardier has met all of its obligations under this
Article 9, should Buyer not accept, pay for and/or take delivery of
any one of the Aircraft within [*
] following the end of the Acceptance Period, the
present Agreement shall automatically terminate or, at Bombardier's
option; terminate solely with respect to such Aircraft. Bombardier
shall however, have the option (but not the obligation) of waiving
such termination should Buyer, within ten (10) calendar days following
such termination, make arrangements satisfactory to Bombardier to
accept delivery and provide payment for all amounts owing or to become
due pursuant to this Agreement.
9.10 Each Aircraft subject to delivery hereunder shall be full of fuel and
oil at the time of such delivery and shall have no more (unless
otherwise mutually agreed) than [* ] of operational time on the
Aircraft or any component thereof, unless necessary to comply with a
Regulatory Change or any other change requested by Buyer. Bombardier
will not demonstrate an Aircraft allocated to Buyer without Buyer's
prior written consent.
-22-
23
ARTICLE 10 - TITLE AND RISK
10.1 Title to the Aircraft and risk of loss of or damage to the Aircraft
passes to Buyer upon Buyer's execution of the Certificate of Receipt
for the Aircraft and when Bombardier delivers the ▇▇▇▇ of Sale to
Buyer on the Delivery Date.
10.2 If, after transfer of title on the Delivery Date, the Aircraft remains
in or is returned to the care, custody or control of Bombardier, Buyer
shall retain risk of loss of, or damage to the Aircraft and for itself
and on behalf of its insurer(s) hereby waives and renounces to, and
releases Bombardier and any of Bombardier's affiliates from any claim,
whether direct, indirect or by way of subrogation, for damages to or
loss of the Aircraft arising out of, or related to, or by reason of
such care, custody or control provided, that [*
].
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24
ARTICLE 11 - CHANGES
11.1 Except for a Permitted Change as described in Article 11.2 or a
Regulatory Change as described in Article 8.4, which Regulatory Change
requires the issuance of a Change Order that need not be mutually
agreed by the parties, any change to this Agreement (including without
limitation the Specification) or any features or BFE, if any, changing
the Aircraft from that described in the Specification attached hereto,
requested by Buyer, and as may be mutually agreed upon by the parties
hereto, shall be made using a change order ("Change Order")
substantially in the format of Exhibit IV hereto. Should Buyer request
a change, Bombardier shall advise Buyer, to the extent reasonably
practical prior to issuance to Buyer of any Change Order covering such
requested change, of the effect, if any, of such change request on:
(a) the Scheduled Delivery Date;
(b) the price and payment terms applicable to such Change Order;
and
(c) any other material provisions of this Agreement which will be
affected by such Change Order.
Such Change Order shall become effective and binding on the parties
hereto when signed by a duly authorized representative of each party.
11.2 Bombardier, prior to the Delivery Date and without a Change Order or
Buyer's consent, may:
(a) substitute the kind, type or source of any material, part,
accessory or equipment with any other material, part,
accessory or equipment of like, equivalent or better kind or
type; or
(b) make such change or modification to the Specification as it
deems appropriate to:
1) improve the Aircraft, its maintainability or
appearance, or
2) to prevent delays in manufacture or delivery, or
3) to meet the requirements of Articles 2 and 8, other
than for a Regulatory Change to which other
provisions of this Agreement apply,
provided that such substitution, change or modification shall not
affect the Aircraft Purchase Price or materially and adversely affect
the [*
], the Scheduled Delivery Date, interchangeability
or replaceability of Spare Parts (as defined in Annex A hereto) or
performance characteristics of the Aircraft. Any change made in
accordance with the provisions of this Article 11.2 shall be deemed to
be a "Permitted Change" and the cost thereof shall be borne by
Bombardier, Bombardier shall provide notice to Buyer of any Permitted
Change if the same is determined by Bombardier in its reasonable
judgment to be material in nature.
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ARTICLE 12 - BUYER'S REPRESENTATIVES AT MANUFACTURE SITE
12.1 From time to time, commencing with the date of this Agreement and
ending with the Delivery Date of the last Aircraft purchased
hereunder, Bombardier shall furnish, without charge, office space at
Bombardier's facility for one (1) representative of Buyer. Buyer shall
be responsible for all expenses of its representative and shall notify
Bombardier by facsimile at least fifteen (15) calendar days prior to
the first scheduled visit of such representative and three (3) days
for each subsequent visit.
12.2 Bombardier's and Bombardier's affiliates facilities shall be
accessible to Buyer's representative during normal working hours.
Buyer's representative shall have the right to periodically observe
the work at Bombardier's or Bombardier's affiliates' facilities where
the work is being carried out provided there shall be no disruption in
the performance of the work.
12.3 Bombardier shall advise Buyer's representative of Bombardier's or
Bombardier's affiliates' rules and regulations applicable at the
facilities being visited and Buyer's representative shall conform to
such rules and regulations.
12.4 At any time prior to delivery of the Aircraft, Buyer's representative
may request, in writing, correction of parts or materials which they
reasonably believe are not in accordance with the Specification.
Bombardier shall provide a written response to any such request.
Communication between Buyer's representative and Bombardier shall be
solely through Bombardier's Contract Department or its designate.
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ARTICLE 13 - EXCUSABLE DELAY
13.1 Notwithstanding any other provision to the contrary contained herein,
in the event of a delay on the part of Bombardier in the performance
of its obligations or responsibilities under the provisions of this
Agreement due directly or indirectly to an Excusable Delay (as
hereinafter defined), Bombardier shall not be liable for, nor be
deemed to be in default under this Agreement on account of such delay
in the delivery of the Aircraft or the performance of other
obligations or responsibilities hereunder and the time fixed or
required for the performance by either party of any obligation or
responsibility in this Agreement shall be extended for a period equal
to the period during which said Excusable Delay or the effect thereof
persists. For purposes of this Agreement "Excusable Delay" shall mean
an event or occurrence which is not within the commercially reasonable
control of Bombardier or not caused by the negligent acts or omissions
of Bombardier and impedes Bombardier's ability to timely perform its
obligations or responsibilities under this Agreement (taking into
account other commercially reasonable and practicable suppliers or
resources available to Bombardier). Excusable Delay shall include, but
not be limited to: an act of God, war, state of war, civil war,
warlike operations, act of the enemy, armed aggression, insurrection,
civil commotion, riot, embargo, epidemic, quarantine, flood,
earthquake, lightning, windstorm or other condition or action of
nature, fire, explosion or other catastrophic or serious accident,
strikes, lock-out, walk-out, or other labour troubles causing
cessation, slow-down or interruption of work, lack or shortage or
delay in delivery of supplies, materials, accessories, equipment,
tools or parts, provided another reasonable and practicable source or
measure to avoid such were not available to Bombardier, delay or
failures of carriers, subcontractors or suppliers provided the same
are ordered in a timely manner, an act of government, legislation,
act, order, directive or regulation of duly constituted authority
having jurisdiction or a Regulatory Change (unless issued solely as a
result of a defect in the Aircraft), or delay in obtaining any
airworthiness approval or certificate, or TC Type Approval (Transport
Category) or by reason of any agreed change made by Bombardier which
cannot, after application of each party's commercially reasonable
efforts, be complied with within the time performance envisaged under
this Agreement. Promptly upon Bombardier's awareness of the occurrence
of any event which, in Bombardier's reasonable estimation will or is
likely to cause an Excusable Delay, Bombardier shall notify Buyer of
same and the expected delay duration if known. The occurrence of an
event constituting an Excusable Delay shall continue as such only for
so long as the cause or the effects thereof persist and Bombardier
shall promptly recommence the performance of its affected obligations
upon cessation of the cause and effects giving rise to Excusable
Delay. Bombardier shall at all times during the existence of an
Excusable Delay, dedicate its commercially reasonable efforts to
mitigate the impact of same upon Bombardier's obligations or
responsibilities.
13.2 [*DELETED IN ITS ENTIRETY]
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13.3 (a) If Bombardier concludes, based on its appraisal of the facts
and normal scheduling procedures, that due to Excusable Delay
delivery of any Aircraft will be delayed for more than [* ]
after the Scheduled Delivery Date or any revised date agreed
to in writing by the parties, Bombardier shall promptly
notify Buyer in writing and [*
].
(b) If, due to Excusable Delay, delivery of any Aircraft is
delayed for more than [* ] after the Scheduled Delivery Date,
[*
].
(c) If Buyer concludes, based on its appraisal of the facts that
a [* ] will delay delivery of any Aircraft for more than [* ]
after its Scheduled Delivery Date, Buyer shall promptly
notify Bombardier in writing. [*
].
(d) [*
]. In the event of a mutually agreed amendment to the
Delivery Schedule contained in Appendix II hereto, the
parties agree to review the [* ]
mentioned above. In the event that [*
] agrees to dedicate its commercially reasonable
efforts to mitigate the impact of the Excusable Delay giving
rise to [*
] with the objective of either re-commencing
delivery of the Aircraft affected by such Excusable Delay to
Buyer or [*
], this Agreement shall be
amended in such manner as is mutually acceptable to [*
].
-27-
28
(e) In the event of an Excusable Delay [* ],
unless otherwise agreed, Buyer shall not be obligated to take
delivery of more than two (2) Aircraft in any month.
13.4 [* ] shall discharge all obligations and
liabilities of Buyer and Bombardier hereunder with respect to [*
], except that Bombardier shall on or before five (5)
business days after [* ] for such terminated Aircraft [*
].
13.5 [*DELETED IN ITS ENTIRETY]
13.6 If, as a result of an Excusable Delay [* ], delivery of an
Aircraft will be delayed to a date beyond the Scheduled Delivery Date
or any revised date previously agreed to in writing by the parties, [*
] shall be adjusted
accordingly. Upon expiration of such [* ]
shall be made while delivery is delayed for Excusable Delay [*
].
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ARTICLE 14 - NON-EXCUSABLE DELAY
14.1 [*DELETED IN ITS ENTIRETY]
14.2 Buyer will not have the right to refuse to take delivery of any
Aircraft because of a Non-Excusable Delay unless and until the [*
].
If Bombardier has not offered an Aircraft for inspection and acceptance
[*
].
Buyer agrees to deliver a written notice to Bombardier at least [*
] prior to the [* ]; which notice
may be delivered prior to the expiration of the [* ]
in which case such notice shall not become effective earlier than the
[*
]. If, Bombardier offers such Aircraft for inspection
and acceptance prior to the effective date of such notice, Buyer may
not refuse to take delivery of such Aircraft because of [*
].
14.3 If as a result of a Non-Excusable Delay, Bombardier shall fail [*
], then in the
event Bombardier shall additionally fail, as a result of a
Non-Excusable Delay, to [*
].
14.4 If as a result of a Non-Excusable Delay, delivery of the Aircraft is
delayed to a date, beyond the Original Scheduled Delivery Date, [*
]
as of the Original Scheduled Delivery Date.
14.5 In the event of a Non-Excusable Delay, unless otherwise agreed, Buyer
shall not be obligated to take delivery of more than two (2) Aircraft
in any month.
14.6 [*DELETED IN ITS ENTIRETY]
14.7 [*DELETED IN ITS ENTIRETY]
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ARTICLE 15 - LOSS OR DAMAGE
15.1 In the event that prior to the Original Scheduled Delivery Date for
any Aircraft, such Aircraft (the "Destroyed Aircraft") is lost,
destroyed, or damaged beyond repair due to any cause or reason (the
"Destruction Event"), Bombardier shall promptly notify Buyer in
writing (a "Destruction Notice") of such Destruction Event.
15.2 This Agreement shall automatically terminate as to such Destroyed
Aircraft unless Buyer gives Bombardier written notice (the "Buyer's
Replacement Notice"), within [* ] of
Buyer's receipt of the Destruction Notice that Buyer desires a
replacement for such Destroyed Aircraft. If Buyer gives Bombardier a
Buyer's Replacement Notice, Bombardier shall use commercially
reasonable efforts to provide Buyer with the next available aircraft
as a replacement hereunder, subject to Bombardier's other written
commitments and production lead times. If Buyer gives Buyer's
Replacement Notice to Bombardier and Buyer and Bombardier agree on a
Scheduled Delivery Date for the replacement aircraft, [*
], except the
parties shall execute a Change Order to this Agreement which shall set
forth the Scheduled Delivery Date for such replacement aircraft.
Nothing contained herein shall obligate Bombardier to manufacture and
deliver such replacement aircraft if it would require the reactivation
or acceleration of its production line for the model of aircraft
purchased hereunder. [*
]
15.3 If the Destruction Event would be treated as an Excusable Delay event
under Article 13.1, then the Change Order with regard to the
replacement aircraft shall provide that the [*
] shall be made pending the delivery of
the replacement aircraft.
15.4 If the Destruction Event would not be treated as an Excusable Delay
event under Article 13.1, then the Change Order with regard to the
replacement aircraft shall provide that (i) [*
] and (ii) [*
].
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31
15.5 If the Destruction Event would be treated as an Excusable Delay event
under Article 13.1, then upon termination of this Agreement with
respect to the Destroyed Aircraft in accordance with Article 15.2 all
obligations and liabilities of Buyer and Bombardier hereunder with
respect to the Destroyed Aircraft and all related undelivered items
and services shall be discharged, [*
].
15.6 If the Destruction Event would not be treated as an Excusable Delay
event under Article 13.1, then upon termination of this Agreement with
respect to the Destroyed Aircraft in accordance with Article 15.2, [*
].
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32
ARTICLE 16 - TERMINATION
16.1 This Agreement may be terminated, in whole or in part, with respect to
any or all of the Aircraft before the Delivery Date by Bombardier or
Buyer by written notice of termination to the other party upon the
occurrence of any of the following events:
(a) such other party makes an assignment for the benefit of
creditors or admits in writing its inability to pay its debts
or that it generally does not pay its debts as they become
due; or
(b) a receiver or trustee is appointed for a party or for
substantially all of such party's assets and, if appointed
without such party's consent, such appointment is not
discharged or stayed within sixty (60) calendar days
thereafter; or
(c) proceedings or action under any law relating to bankruptcy,
insolvency or the reorganization or relief of debtors are
instituted by or against a party, and, if contested by such
party, are not dismissed or stayed within sixty (60) calendar
days thereafter; or
(d) any material writ of attachment and execution or any similar
process is issued or levied against a party or any
significant part of its property and is not released, stayed,
bonded or vacated within sixty (60) calendar days after its
issue or levy.
16.2 In addition, this Agreement may be terminated, in whole or in part,
before the Delivery Date with respect to any or all undelivered
Aircraft
(a) as otherwise provided in this Agreement, or
(b) by Bombardier, if Buyer is in default or breach of any
material term or condition of this Agreement and Buyer does
not cure such default or breach within [*
] after receipt of notice from Bombardier
specifying such default or breach, or
(c) by Buyer, if Bombardier is in default or breach of any
material term or condition of this Agreement and such breach
remains uncured for a period of [*
] following receipt of a notice from Buyer
specifying the nature of default or breach.
16.3 In case of termination of this Agreement by [*
]:
(a) all rights (including property rights), if any, which Buyer
or its permitted assign may have or may have had in or to
this Agreement with respect to and in any or
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33
all of the applicable undelivered Aircraft shall become null
and void with immediate effect; and
(b) Bombardier may sell, lease or otherwise dispose of such
Aircraft to another party free of any claim by Buyer.
16.4 In addition in the case of a termination by [*
]:
(a) [*DELETED IN ITS ENTIRETY]
(b) [*
]. Bombardier
acknowledges and agrees that should Bombardier fail to
perform those obligations required of Bombardier under this
Article, irreparable loss and damage will be suffered by
Buyer for which no adequate remedy at law may exist and as a
result, Buyer shall be entitled to pursue any and all
equitable or other remedies necessary or appropriate to
enforce and ensure Bombardier's performance of its
obligations hereunder such equitable remedies to specifically
include, without limitation, seeking any temporary or
permanent injunction or other court order requiring specific
performance of or fulfillment by, Bombardier of its
obligations under this Article. In the event Buyer institutes
any such equitable or other legal proceeding requiring
Bombardier to perform its obligations under this Article,
Bombardier hereby unconditionally and irrevocably waives (i)
any requirement that Buyer submit proof of the economic value
of any interest sought to be protected under such proceeding,
(ii) any requirement that the Buyer post any bond or other
security in connection with such proceeding, or (iii) any
defense or objection or assertion that such proceeding may
not be properly maintained (but preserving to Bombardier all
other rights and defenses).
(c) [*Deleted in its entirety].
(d) Nothing in this Article 16.4 shall affect [* ],
in accordance with the applicable provisions of this
Agreement to [*
].
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34
16.5 In the case of a termination by [*
]
with respect to undelivered Aircraft as to which the termination is
applicable shall be
[*
]
of the effective date of termination.
16.6 Notwithstanding termination of this Agreement for any reason whatsoever
[*
].
16.7 Notwithstanding termination of this Agreement and except as otherwise
specifically and expressly provided to the contrary under this
Agreement, [*
].
16.8 Except as expressly provided [*
], upon termination of
this Agreement, Bombardier shall, within [*
].
16.9 In the event this Agreement is terminated for any reason, the Letter
Agreements attached hereto shall become null and void unless otherwise
expressly provided in any said respective Letter Agreement.
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35
ARTICLE 17 - NOTICES
17.1 Any notice, request, approval, permission, consent or other
communication ("Notice"), to be given or required under this Agreement
shall be provided in writing, by registered mail, facsimile, courier,
or other electronic communication, subject to Article 17.2 and 17.3
below and provided that no notice shall be sent by mail if disruption
of postal service exists or is threatened either in the country of
origin or of destination, by the party giving the Notice and shall be
addressed as follows:
(a) Notice to Bombardier shall be addressed to:
Bombardier Inc.
Bombardier Aerospace Regional Aircraft
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: Director of Contracts
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) Notice to Buyer shall be addressed to:
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇.▇.▇., ▇▇▇▇▇-▇▇▇▇
Attention: Mr. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: [* ]
17.2 Subject to Article 17.3, Notice given in accordance with Article 17.1
shall be deemed sufficiently given to and received by the addressees:
(a) if delivered by hand, on the day when the same shall have
been so delivered; or
(b) if mailed or sent by courier on the day indicated on the
corresponding acknowledgment of receipt; or
(c) if sent by facsimile and an acknowledgment of receipt is
provided by the addressee, either by dating and initialing
the respective facsimile transmission and returning same to
the originator, or otherwise. An acknowledgment of receipt
shall not constitute the agreement of the addressee as to the
content of the Notice but rather shall be conclusive only as
to the receipt thereof.
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36
17.3 Notwithstanding the foregoing, any Notice which communicates an
alleged breach or default hereunder by any party hereto or exercises
or waives any right of termination hereunder shall only be given by
personal delivery, registered mail or courier.
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37
ARTICLE 18 - INDEMNITY AGAINST PATENT [*
] INFRINGEMENT
18.1 In the case of any actual or alleged infringement of any Canadian or
United States patent or, subject to the conditions and exceptions set
forth below, any patent issued under the laws of any other country in
which Buyer from time to time may lawfully operate the Aircraft
("Other Patents"), by the Aircraft, or by any system, accessory,
equipment or part installed in such Aircraft at the time title to such
Aircraft passes to Buyer, Bombardier shall indemnify, protect and hold
harmless Buyer from and against all claims, suits, actions,
liabilities, damages and costs resulting from the infringement,
excluding any incidental or consequential damages (which include
without limitation loss of revenue or loss of profit) and Bombardier
shall, at its option and expense:
(a) procure for Buyer the right under such patent to use such
system, accessory, equipment or part; or
(b) replace such system, accessory, equipment or part with one of
the similar nature and quality that is non-infringing; or
(c) modify such system, accessory, equipment or part to make same
non-infringing in a manner such as to keep it otherwise in
compliance with the requirements of this Agreement.
Bombardier's obligation hereunder shall extend to Other Patents only
if from the time of design of the Aircraft, system, accessory,
equipment or part until the alleged infringement claims are resolved:
(a) such other country and the country in which the Aircraft is
permanently registered have ratified and adhered to and are
at the time of the actual or alleged infringement contracting
parties to the Chicago Convention on International Civil
Aviation of December 7, 1944 and are fully entitled to all
benefits of Article 27 thereof; and
(b) such other country and the country of registration shall each
have been a party to the International Convention for the
Protection of Industrial Property (Paris Convention) or have
enacted patent laws which recognize and give adequate
protection to inventions made by the nationals of other
countries which have ratified, adhered to and are contracting
parties to either of the forgoing conventions.
18.2 [*DELETED IN ITS ENTIRETY]
(a) [*DELETED IN ITS ENTIRETY]
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38
(b) [*DELETED IN ITS ENTIRETY]
(c) [*DELETED IN ITS ENTIRETY]
18.3 The foregoing indemnities in 18.1 and 18.2 do not apply (i) to BFE, or
to avionics, engines or any system, accessory, equipment or part that
was not manufactured to Bombardier's detailed design or to any system,
accessory, equipment or part manufactured by a third party to
Bombardier's detailed design without Bombardier's authorization, [
].
18.4 Buyer's remedies and Bombardier's obligations and liabilities under
this Article are conditional upon (i) Buyer giving Bombardier written
Notice within ten (10) days after Buyer receives notice of a suit or
action against Buyer alleging infringement or within twenty (20) days
after Buyer receives any other written claim of infringement (ii)
Buyer uses reasonable efforts in cooperation with Bombardier to reduce
or mitigate any such expenses, damages, costs or royalties involved
any costs or expenses incurred by Buyer in so doing being subject to
indemnification by Bombardier hereunder, and (iii) Buyer furnishes
promptly to Bombardier all data, papers and records in its possession
or control necessary or useful to resist and defend against such claim
or suit. Bombardier may at its option conduct negotiations with any
party claiming infringement and may intervene in any suit or action.
Bombardier shall be entitled at any stage of the proceedings to assume
or control the defense provided, that Bombardier shall not in the
course of such defense undertake any action or omission which
prejudices Buyer's rights or interest without Buyer's prior written
consent which consent shall not be unreasonably withheld. Solely in
the event that Bombardier assumes control of any defense hereunder,
Buyer's remedy and Bombardier's obligation and liability are further
conditional upon Bombardier's prior approval of Buyer's payment or
assumption of any liabilities, expenses, damages, royalties or costs
for which Bombardier may be held liable or responsible.
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ARTICLE 19 - LIMITATION OF LIABILITY AND INDEMNIFICATION
19.1 [*DELETED IN ITS ENTIRETY]]
19.2 [*DELETED IN ITS ENTIRETY]
19.3 [*DELETED IN ITS ENTIRETY]
19.4 [*DELETED IN ITS ENTIRETY]
19.5 [*DELETED IN ITS ENTIRETY]
19.6 [*DELETED IN ITS ENTIRETY]
19.7 [*DELETED IN ITS ENTIRETY]
19.8 [*DELETED IN ITS ENTIRETY]
19.9 [*DELETED IN ITS ENTIRETY]
19.10 [*DELETED IN ITS ENTIRETY]
19.11 [*DELETED IN ITS ENTIRETY]
19.12 [*DELETED IN ITS ENTIRETY]
19.13 [*DELETED IN ITS ENTIRETY]
19.14 [*DELETED IN ITS ENTIRETY]
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ARTICLE 20 - ASSIGNMENT
20.1 Either party may assign, sell, transfer or dispose of (in whole or in
part) any of its rights and obligations hereunder to a wholly owned
subsidiary or affiliate or to a Successor in Interest provided (i)
that there is no increase to the liability and/or responsibility of
the non-assigning party and (ii) that the assigning party remains
jointly and severally liable with any assignee for the performance of
its obligation under this Agreement and (iii) in the case of a
Successor in Interest that such Successor in Interest shall [*
], after giving
effect to any such succession (provided that there shall be no [* ]
requirement imposed after delivery of the last Aircraft and provided
further, that the application of such [* ] requirement to the
Incremental Aircraft (as defined in Letter Agreement No. 0430-01)
shall be reviewed at the time of exercise of the right to purchase
same.
20.2 Except as provided in Article 20.1 or 20.5, neither Buyer nor
Bombardier shall assign, sell, transfer or dispose of (in whole or in
part) any of its rights or obligations hereunder without the other
parties prior written consent, such consent not to be unreasonably
withheld. In the event of such assignment, sale, transfer or
disposition Buyer or Bombardier as applicable shall remain jointly and
severally liable with any assignee for the performance of all and any
of the assigning party's obligations under this Agreement. In the
event of an assignment by Buyer, Bombardier reserves the right as a
condition of its consent to amend one or more of the terms and
conditions of this Agreement.
20.3 Notwithstanding Article 20.2 above, Buyer may assign, after transfer
of title to any one or more of the Aircraft, its rights under this
Agreement to a third party purchaser of any one or more of the
Aircraft, provided said third party acknowledges in writing to be
bound by the applicable terms and conditions of this Agreement,
including but not limited to the provisions and limitations as
detailed Annex A, Customer Support Services, Annex B, Warranty and
Service Life Policy and of the provisions and limitations in
Limitation of Liability as defined in Article 19 hereof and Indemnity
Against Patent [*
] as defined in Article 18 hereof and any other
on-going obligations of Buyer, which shall apply to it to the same
extent as if said third party was Buyer hereunder, provided however,
that there is no increase to the liability and/or responsibility of
Bombardier.
20.4 Subject to Buyer's rights, defenses and claims herein, Bombardier may
only assign its rights to receive money hereunder without the prior
consent of Buyer provided that such third-party assignee shall
acknowledge in writing that it shall be bound by the applicable terms
and conditions of this Agreement.
20.5 Notwithstanding the other provisions of this Article 20, Bombardier
shall, at Buyer's cost and expense, if so requested in writing by
Buyer, take any action reasonably required for the purpose of causing
any of the Aircraft to be subjected (i) to, upon or after the Delivery
-40-
41
Date, an equipment trust, conditional sale or lien, or (ii) to another
arrangement for the financing of the Aircraft by Buyer, providing,
however, there shall be no increase to the liability and/or
responsibility of Bombardier arising through such financing.
Bombardier hereby agrees that should Buyer's requested action be
limited to the consent to assignment of all or part of this Agreement
in accordance with the provisions of this Article 20, Bombardier shall
do so, if appropriate, at its own cost and expense.
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ARTICLE 21 - SUCCESSORS
21.1 This Agreement shall inure to the benefit of and be binding upon each
of Bombardier and Buyer and their respective successors and permitted
assigns provided, that [*
].
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ARTICLE 22 - APPLICABLE LAWS
22.1 THIS AGREEMENT SHALL BE SUBJECT TO AND CONSTRUED IN ACCORDANCE WITH
AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, UNITED STATES OF AMERICA INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK, AND SPECIFICALLY EXCLUDING, TO THE FULLEST EXTENT
PERMITTED BY LAW, CHOICE OF LAW RULES TO THE EXTENT THAT SUCH RULES
WOULD RESULT IN THE APPLICATION OF LAWS OF ANY JURISDICTION OTHER THAN
THE STATE OF NEW YORK, AND THE PARTIES HAVE AGREED THAT THE
APPLICATION OF THE UNITED NATIONS CONVENTION ON CONTRACTS FOR THE
INTERNATIONAL SALE OF GOODS IS HEREBY EXCLUDED.
22.2 Each of Buyer and Bombardier agrees that any legal action or
proceeding with respect to this Agreement shall be brought exclusively
in the Federal Courts of the United States of America for the Southern
District Courts of New York or in the Supreme Court of the State of
New York in the County of New York and by the execution and delivery
of this Agreement irrevocably consents and submits to the jurisdiction
of each of the aforesaid court in personam with respect to any such
action or proceeding and irrevocably waive any objection either party
may have as to venue of any such suit, action or procedure brought in
such court or that such court is an inconvenient forum.
Notwithstanding the foregoing, nothing in this paragraph shall affect
the right of any party hereto or their successors or assigns to bring
any action or proceeding against the other party hereto or their
property in the courts of other jurisdictions as may be permitted by
applicable law (a) in order to enforce any final nonappealable
judgment obtained in any such New York court or (b) if both such New
York federal and state courts refuse to accept jurisdiction over such
legal action or proceeding. Both parties agree that service of any and
all legal process, summons, notices and other documents out of any
such courts may be made by delivering a copy thereof to such party in
the manner specified in Article 17.3 and to the address specified in
Article 17.1.
22.3 Bombardier's obligations under this Agreement shall be subject to and
apply only to the extent permitted by applicable laws, regulations,
directives or orders regarding export controls.
22.4 Buyer's obligations under this Agreement shall be subject to and apply
only to the extent permitted by applicable laws, regulations,
directives or orders regarding import controls.
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ARTICLE 23 - CONFIDENTIAL NATURE OF AGREEMENT
23.1 This Agreement and all information furnished or obtained pursuant to
this Agreement is confidential (provided that any such information so
furnished or obtained in written form is conspicuously designated or
marked as confidential). Each party hereto agrees to keep confidential
this Agreement and all information so furnished to or so obtained by
it pursuant to this Agreement and not to disclose the same, in whole
or in part, to third parties; provided, however, that a party (the
"Disclosing Party") may disclose this Agreement, its contents and any
such information:
(a) as has become public (other than as a result of disclosure by
or on behalf of the Disclosing Party) or has become known to
such Disclosing Party other than pursuant to this Agreement
and without any breach of any confidentiality obligation
being known to such Disclosing Party; and
(b) to the independent auditors and attorneys of the Disclosing
Party (who shall be advised of the confidential nature of
this Agreement and such information); and
(c) in response to any summons or subpoena or in connection with
any litigation, provided that, if practicable and not in
violation of any applicable law, rule, regulation or order,
notice of such disclosure shall be given to the other party
hereto, and (if applicable and not so in violation) in
advance of such disclosure, and such other party shall be
permitted to resist such disclosure by the appropriate legal
proceedings, provided such resistance does not materially
adversely affect the Disclosing Party; and
(d) to the extent that such Disclosing Party reasonably believes
it is required in order to comply with any law, rule,
regulation or order (including, without limitation,
applicable securities laws and regulations) applicable to
such party, provided that, if practicable and not in
violation of any such applicable law, rule, regulation or
order, notice of such disclosure shall be given to the other
party, and (if practicable and not so in violation) in
advance of such disclosure, and such other party shall be
permitted (if practicable and not so in violation) to resist
or seek confidential treatment of such disclosure and the
Disclosing Party shall use all reasonable efforts to
cooperate with and assist the other party in resisting or
seeking confidential treatment of such disclosure, including
undertaking the appropriate proceedings or making the
appropriate applications or requests (at the cost of the
other party) for such purpose where such other party is not
entitled to do so on its own behalf; and
(e) to a prospective assignee who Buyer reasonably believes is an
eligible assignee under Article 20 hereof and which
prospective assignee has agreed to be bound by the provisions
of this paragraph in connection with any contemplated
assignment,
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provided, however, that no such disclosure shall be made
pursuant to this clause (e) to any potential assignee
which is a Competitor of Bombardier; and
(f) as may be reasonably necessary for either party to carry out
its obligations or enforce or protect its right under this
Agreement or other agreements related to this Agreement to
which it is a party; and
(g) as may be required by financial institutions or arrangers
involved with the financing of the Aircraft, which financial
institutions or arranger agree in writing to be bound by the
provisions of this section; and
(h) as may be reasonably required by Bombardier for purposes of
analytical or technical product support or improvement or
enhancement of customer support services or otherwise in the
ordinary course of its aircraft manufacturing, marketing or
service business and operations.
23.2 Either party may announce the signing of this Agreement by means of a
notice to the press provided that the content and date of the notice
has been agreed to by the other party.
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ARTICLE 24 - AGREEMENT
24.1 This Agreement and the matters referred to herein constitute the
entire Agreement between Bombardier and Buyer and supersede and cancel
all prior representations, brochures, alleged warranties, statements,
negotiations, undertakings, letters, memoranda of agreement,
proposals, acceptances, agreements, understandings, contracts and
communications, whether oral or written, between Bombardier and Buyer
or their respective agents, with respect to or in connection with the
subject matter of this Agreement and no agreement or understanding
varying the terms and conditions hereof shall be binding on either
Bombardier or Buyer hereto unless an amendment to this Agreement is
issued and duly signed by their respective authorized representatives
pursuant to the provisions of this Article hereof. In the event of any
inconsistencies between this Agreement and Letter Agreements the
provisions of the Letter Agreements shall prevail.
24.2 If any of the provisions of this Agreement are for any reason declared
by judgment of a court of competent jurisdiction to be unenforceable
or ineffective, those provisions shall be deemed severable from the
other provisions of this Agreement and the remainder of this Agreement
shall remain in full force and effect.
24.3 Bombardier and Buyer confirm to each other they have each obtained the
required authorizations and fulfilled any conditions applicable to
enable each of them to enter into this Agreement.
24.4 Buyer and Bombardier agree that this Agreement has been the subject of
discussion and negotiation and is fully understood by the parties
hereto and that the price of the Aircraft and the other mutual
agreements of the parties set forth herein were arrived at in
consideration of the provisions contained in Article 19.
24.5 This Agreement may be executed in counterparts each of which will
constitute one and the same document.
24.6 The parties agree that time is of the essence in all matters
concerning this Agreement.
24.7 The failure of either party to enforce at any time any of the
provisions of this Agreement of or require at any time performance of
any of the provisions hereof, shall in no way be construed to be a
waiver of such provisions, nor in any way affect the validity of this
Agreement or any part hereof or the right of any such party thereafter
to enforce each and every provision of this Agreement.
24.8 Buyer and Bombardier shall supply the other party within thirty (30)
days of execution of this Agreement a legal opinion in a form
reasonably acceptable to the other party, prepared by external
counsel, as to the due authorization, execution and delivery of the
Agreement by such party and that it is a legally valid, binding
obligation of Bombardier
-46-
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and enforceable in accordance with its terms,
save and except for general laws affecting creditors and their
availability of equitable remedies.
-47-
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In witness whereof this Agreement was signed on the date written
hereof:
For and on behalf of For and on behalf of
Atlantic Southeast Airlines, Inc.: Bombardier Inc.:
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------ ----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman and Chief Executive Officer Title: Director of Contracts,
Bombardier Aerospace Regional
Aircraft
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APPENDIX I
ECONOMIC ADJUSTMENT FORMULA
Pursuant to the provision of Article 4 of this Agreement, economic adjustment
will be calculated using the following Economic Adjustment Formula:
PP = [*DELETED IN ITS ENTIRETY]
Where:
PP = [*DELETED IN ITS ENTIRETY]
PO = [*DELETED IN ITS ENTIRETY]
LD = [*DELETED IN ITS ENTIRETY]
LO = [*DELETED IN ITS ENTIRETY]
ED = [*DELETED IN ITS ENTIRETY]
EO = [*DELETED IN ITS ENTIRETY]
CD = [*DELETED IN ITS ENTIRETY]
CO = [*DELETED IN ITS ENTIRETY]
MD = [*DELETED IN ITS ENTIRETY]
MO = [*DELETED IN ITS ENTIRETY]
FD = [*DELETED IN ITS ENTIRETY]
FO = [*DELETED IN ITS ENTIRETY]
For the purpose of the Economic Adjustment Formula and the calculation of the
economic adjustment:
(a) [*DELETED IN ITS ENTIRETY]
(b) [*DELETED IN ITS ENTIRETY]
-49-
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(c) [*DELETED IN ITS ENTIRETY]
(d) [*DELETED IN ITS ENTIRETY]
(e) [*DELETED IN ITS ENTIRETY]
(f) [*DELETED IN ITS ENTIRETY]
(g) [*DELETED IN ITS ENTIRETY]
1) [*DELETED IN ITS ENTIRETY]
2) [*DELETED IN ITS ENTIRETY]
3) [*DELETED IN ITS ENTIRETY]
In the calculation of the Aircraft Purchase Price the following guidelines in
respect of decimal places shall apply:
(a) All indices in the Economic Adjustment Formula shall be used
to the second decimal place,
(b) The Economic Adjustment Formula shall be calculated to four
decimal places, and
(c) The Aircraft Purchase Price resulting from the Economic
Adjustment Formula shall be corrected to the nearest dollar.
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APPENDIX II
DELIVERY SCHEDULE
First Aircraft [* ] [* ]
Second Aircraft [* ] [* ]
Third Aircraft [* ] [* ]
Fourth Aircraft [* ] [* ]
Fifth Aircraft [* ] [* ]
Sixth Aircraft [* ] [* ]
Seventh Aircraft [* ] [* ]
Eighth Aircraft [* ] [* ]
Ninth Aircraft [* ] [* ]
Tenth Aircraft [* ] [* ]
Eleventh Aircraft [* ] [* ]
Twelfth Aircraft [* ] [* ]
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APPENDIX III
SPECIFICATION
TYPE SPECIFICATION
NUMBER RAD-670-113 ISSUE NC DATED
AUGUST 28, 1998
[* Deleted in its entirety]
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APPENDIX IV
BUYER SELECTED OPTIONAL FEATURES
CR No. Description U.S Dollars
[* ]
00-213 Certification - FAA (▇▇▇▇▇▇▇ Strapping and Red Anti-Ice PBA) [* ]
00-215 Performance - Extended Range - 75,000 LB. MTOW [* ]
11-2XX Exterior Paint Scheme - Atlantic Southeast Airlines [* ]
21-201 Air Conditioning - Temperature Control in Aft Cargo Compartment [* ]
21-209 Air Conditioning - Ground Cart Connection [* ]
23-231 VHF COMM -Third Radio Complete Provisions [* ]
25-02-2XX Interior Finish & Decor - Atlantic Southeast Airlines [* ]
▇▇-▇▇-▇▇▇ Seats - In-Arm Tray Tables at front and exit rows [* ]
▇▇-▇▇-▇▇▇ Seats - Recline Feature [* ]
25-24-2XX Entrance Storage Compartment - Additional Shelves [* ]
▇▇-▇▇-▇▇▇ Wardrobe - Deletion of LH Forward [* ]
25-24-220 Storage Compartment - Deletion of RH Storage [* ]
25-2XX Customized Interior [* ]
▇▇-▇▇-▇▇▇ Galley-Snack & Hot Beverage Service (Provn's for 4 carts) [* ]
▇▇-▇▇-▇▇▇ Galley 2 - Snack Service [* ]
▇▇-▇▇-▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - ▇▇▇ Coffee Maker (qty 2) [* ]
25-60-2XX Emergency Equipment - Atlantic Southeast Airlines [* ]
33-203 Lights - Red Beacon Lights [* ]
33-210 Lights - Tail Logo Floodlights [* ]
33-220 Lights - Forward and Aft Cargo Door Floodlights [* ]
▇▇-▇▇▇ ▇▇▇ - ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇-▇▇▇▇ [* ]
34-250 GPS - Complete Provision For ▇▇▇▇▇▇▇ GPS [* ]
▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇ setting flashing at 18,000 ft. [* ]
35-204 Oxygen - Flight Crew - EROS Magic Mask Installation [* ]
▇▇-▇▇▇ ▇▇▇▇▇ - ▇▇▇▇▇▇▇ ▇▇▇▇▇ System (for Galley 1) [* ]
79-201 Engine Oil - Remote Oil Replenishment System [* ]
TOTAL TECHNICAL FEATURES [* ]
------------------------------------------------------------------------------------------------------------------
On or before [* ], Buyer shall have the option to have [* ]
included as a Buyer Selected Optional Feature hereunder [*
].
[* ]
------------------------------------------------------------------------------------------------------------------
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EXHIBIT I
CERTIFICATE OF ACCEPTANCE
The undersigned hereby acknowledges on behalf of Buyer acceptance of
the Aircraft bearing manufacturer's serial number ____________________
fitted with two (2) General Electric CF-34-8C1 turbofan engines
bearing serial numbers _____________________ and __________________ as
being in accordance with the terms and conditions of this Agreement
signed on the day of ___________, 200_ between Bombardier Inc. and
Buyer.
Place: Date:
---------------------------- --------------------------
SIGNED FOR AND ON BEHALF OF
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
---------------------------------------
Title:
---------------------------------------
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EXHIBIT II
WARRANTY ▇▇▇▇ OF SALE
1. For valuable consideration, Bombardier Inc., as owner of the full
legal and beneficial title of the Aircraft described as follows:
One Canadair Regional Jet Model CL-600-2C10 Aircraft Bearing:
Manufacturer's serial number:
With:
Two (2) CF34-8C1 engines serial numbers:
together with all avionics, appliances, instruments, appurtenances,
accessories, furnishings and/or other equipment or property
incorporated in or installed on or attached to said Aircraft and
engines (hereinafter referred to as the "Aircraft") does this _____
day of ________, 200__ hereby convey, sell, grant, transfer, bargain
and deliver and set over to Atlantic Southeast Airlines, Inc.
(hereinafter referred to as "Buyer"), and unto its successors and
assigns forever all of Bombardier Inc.'s right, title and interest in
and to such Aircraft.
2. Bombardier Inc. represents and warrants to Buyer:
(i) that Bombardier Inc. has good and marketable title to the
Aircraft and the good and lawful right to the Aircraft and
the good and lawful right to sell the same to Buyer; and
(ii) the good and marketable title to the Aircraft is hereby duly
vested in Buyer free and clear of all claims, liens,
encumbrances and rights of others of any nature. Bombardier
Inc. hereby covenants and agrees to defend such title forever
against all claims and demands whatsoever.
This full Warranty ▇▇▇▇ of Sale is governed by the internal laws of the State
of New York, United States of America.
IN WITNESS WHEREOF, Bombardier Inc. has caused this instrument to be executed
and delivered by its duly authorized personnel.
BOMBARDIER INC.:
Per:
--------------------------------------------
Title:
--------------------------------------------
-55-
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EXHIBIT II CONT'D
F.A.A. ▇▇▇▇ OF SALE
-56-
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EXHIBIT III
CERTIFICATE OF RECEIPT OF AIRCRAFT
THE UNDERSIGNED HEREBY ACKNOWLEDGES TO HAVE RECEIVED FROM BOMBARDIER
INC., IN DORVAL, PROVINCE OF QUEBEC, CANADA, ON THE _____________ DAY OF
______________, AT THE HOUR OF _____________ O'CLOCK, ONE (1) CANADAIR REGIONAL
JET AIRCRAFT MODEL CL-600-2C10 INCLUDING WITH THE AIRCRAFT TWO (2) CF34-8C1
TURBOFAN ENGINES BEARING MANUFACTURER'S SERIAL NUMBERS _____________ &
__________________.
Signed for and on behalf of
Atlantic Southeast Airlines, Inc.
By:
-------------------------------------
Title:
-------------------------------------
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EXHIBIT IV
===========================================================================================
CONTRACT CHANGE ORDER
===========================================================================================
PURCHASER:
PURCHASE AGREEMENT NO.: AIRCRAFT TYPE:
C.C.O. NO.: DATED:
PAGES AFFECTED: PAGE __ of __
-------------------------------------------------------------------------
1.0 REASON FOR CHANGE
[DESCRIBE IF BUYER REQUESTED, AGREED CHANGE, REGULATORY CHANGE AND REASON FOR CHANGE]
2.0 DESCRIPTION OF CHANGE
3.0 PRICE
[DESCRIBE THE IMPACT ON AIRCRAFT PURCHASE PRICE AND NET AIRCRAFT PURCHASE PRICE]
4.0 PAYMENT
[DESCRIBE METHOD AND TIME OF PAYMENT OF CHANGE]
5.0 CUSTOMER SERVICES
[DESCRIBE IMPACT ON TRAINING, WARRANTY, SERVICE LIFE POLICY, TECHNICAL DATA AND GUARANTEES]
6.0 TECHNICAL MATTERS
[DESCRIBE IMPACT ON PERFORMANCE GUARANTEE, SPECIFICATION, WEIGHT AND INTERCHANGEABILITY]
7.0 OTHER
[DESCRIBE EFFECTIVITY OF CHANGE, RETROFIT PLANS IF APPLICABLE AND IMPACT ON DELIVERY DATE]
ALL OTHER TERMS AND CONDITIONS OF THE AGREEMENT WILL REMAIN UNCHANGED
FOR ADMINISTRATIVE PURPOSES ONLY, A CONSOLIDATION OF THE AMENDMENTS CONTAINED
IN THIS CCO IS ATTACHED. IN THE EVENT OF INCONSISTENCIES BETWEEN THE
CONSOLIDATION AND THIS CCO, THIS CCO SHALL PREVAIL.
FOR AND ON BEHALF OF: FOR AND ON BEHALF OF:
Bombardier Inc.
-----------------------------------
Signed: Signed:
--------------------------- -----------------------------
Date: Date:
----------------------------- -------------------------------
===========================================================================================
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ANNEX "A"
CUSTOMER SUPPORT SERVICES
TECHNICAL SUPPORT, SPARE PARTS, TRAINING AND TECHNICAL DATA
The following Customer Support Services are those services to which reference
is made in Article 3 of this Agreement.
ARTICLE 1 - TECHNICAL SUPPORT
1.1 FACTORY SERVICE
Bombardier agrees to maintain or cause to be maintained the capability
to respond to Buyer's technical inquiries, to conduct investigations
concerning repetitive maintenance problems and to issue findings and
recommend action thereon. [*
]
Bombardier Customer Services Action Center maintains coverage
twenty-four (24) hours a day, three hundred and sixty-five (365) days
a year to receive and respond to operator technical and operational
queries. Specialists accessible through the Action Center include
airframe, interiors, avionics, electrical, propulsion and
hydro-mechanical systems. Interface can also be provided with vendor
and technical publications personnel.
1.2 FIELD SERVICE REPRESENTATIVE
1.2.1 SERVICES
Bombardier shall assign [* ] Field Service
Representatives ("FSR") to Buyer's main base of operation or
other location as may be mutually agreed.
1.2.2 TERM
Such assignment shall be for [* ] in the aggregate,
and shall commence approximately one (1) month prior to the
Delivery Date of the first Aircraft. The FSR assignment may
be extended on terms and conditions to be mutually agreed.
1.2.3 RESPONSIBILITY
The FSR's responsibility shall be to provide technical advice
to Buyer for the line maintenance and operation of the
Aircraft systems and troubleshooting during scheduled and
unscheduled maintenance by Buyer's designated personnel ("FSR
Services").
A-1
60
1.2.4 TRAVEL
If requested by Buyer, the FSR may, at Buyer's expense,
travel to another location to provide technical advice to
Buyer.
1.2.5 OFFICE FACILITIES
Buyer shall furnish the FSR, at no charge to Bombardier,
suitable and private office facilities and related equipment
including desk, file cabinet, access to two telephone lines,
facsimile and photocopy equipment conveniently located at
Buyer's main base of operation or other location as may be
mutually agreed.
1.2.6 ADDITIONAL EXPENSES
Buyer shall reimburse Bombardier (net of any additional taxes
on such reimbursement) the amount of any and all taxes
(except taxes assessed on the income of the FSR by Canada, or
any province thereof and succeeding to the territory thereto
or any governmental authority having jurisdiction over
Bombardier or any successor agency to the Canadian taxing
authorities) and fees of whatever nature, including any
customs duties, withholding taxes or fees together with any
penalties or interest thereon, paid or incurred by Bombardier
or the FSR or other Bombardier employee as a result of or in
connection with the rendering of the services. Taxes subject
to reimbursement by Buyer hereunder shall be net of all
credits issued by any Canadian or other taxing authority
having jurisdiction to levy such taxes.
1.2.7 RIGHT TO STOP WORK
Bombardier shall not be required to commence or continue the
FSR Services when:
a.) there is a labour dispute or work stoppage in
progress at Buyer's facilities;
b.) there exist war, risk of war or warlike operations,
riots or insurrections;
c.) there exist conditions that are dangerous to the
safety or health of the FSR or other Bombardier
employee; or
d.) the Government of the country where Buyer's
facilities are located or where Buyer desires the
FSR to travel refuses the Bombardier employee
permission to enter said country or Buyer's base of
operations.
1.2.8 WORK PERMITS AND CLEARANCES
Buyer shall agree to cooperate with Bombardier in obtaining
and arranging for all necessary work permits and airport
security clearances required for the FSR or other Bombardier
employees to permit timely accomplishment of the FSR
services.
A-2
61
1.3 MAINTENANCE PLANNING SUPPORT
1.3.1 SCHEDULED MAINTENANCE TASK CARDS
As described in Annex A Attachment A, Bombardier shall
provide Buyer Bombardier's standard format scheduled
maintenance task cards that shall conform to the Aircraft at
the Delivery Date. At Buyer's request Bombardier shall
provide a proposal for task cards produced to Buyer's format.
1.3.2 IN-SERVICE MAINTENANCE DATA
Buyer agrees to provide to Bombardier in-service maintenance
data in order to provide updates to Bombardier's recommended
maintenance program. Buyer and Bombardier shall agree on
standards and frequency for communication of such data.
Bombardier agrees not to disclose Buyer's identity on any of
Buyer's maintenance data that Bombardier may provide to any
third parties.
1.4 ADDITIONAL SERVICES
At Buyer's request Bombardier shall provide a proposal to provide such
additional support services as the parties may agree upon, which may
include special investigations, maintenance and repair of the
Aircraft.
A-3
62
ARTICLE 2 - SPARE PARTS, GSE, TOOLS AND TEST EQUIPMENT
2.1.1 DEFINITIONS
A. "▇▇▇▇ PARTS":
any spare parts, ground support equipment, tools and test
equipment which bear an in-house Cage Code number in the ▇▇▇▇
Provisioning Files (as that expression is defined in ATA
Specification 200).
B. "POWER PLANT PARTS":
any power plant or power plant part or assembly carrying the
power plant manufacturer's part number or any part furnished by
the power plant manufacturer for incorporation on the Aircraft.
C. "VENDOR PARTS":
any spare parts, ground support equipment, tools and test
equipment for the Aircraft which are not ▇▇▇▇ Parts or Power
Plant Parts for stock items;
D. "SPARE PARTS":
all materials, spare parts, assemblies, special tools and items
of equipment, including ground support equipment, ordered for the
Aircraft by Buyer from Bombardier. The term Spare Parts includes
▇▇▇▇ Parts, Power Plant Part and Vendor Parts.
E. "ORDER":
any order for Spare Parts issued by Buyer to Bombardier; and
F. "TECHNICAL DATA":
shall have the meaning attributed to it in Annex A Article 4.1.
2.1 TERM AND APPLICABILITY
The term of this Annex A Article 2 shall become effective on the date
hereof and shall remain in full force and effect with respect to the
purchase and sale of Spare Parts for each Aircraft [*
]. The provisions of Annex A
Articles 2.2, 2.6.5, and Articles 19 to this Agreement shall survive
expiration or termination of this Agreement.
2.2 ORDER TERMS
Terms and conditions hereof shall apply to all Orders placed by Buyer
with Bombardier in lieu of any terms and conditions in Buyer's
purchase orders.
A-4
63
2.3 PURCHASE AND SALE OF SPARE PARTS
2.3.1 AGREEMENT TO MANUFACTURE AND SELL
Bombardier shall manufacture, or procure, and make available
for sale to Buyer suitable Spare Parts in quantities
sufficient to meet the reasonably anticipated needs of Buyer
for normal maintenance and normal spares inventory
replacement for each Aircraft. During the term specified in
Annex A Article 2.1 above, Bombardier shall also maintain a
shelf stock of certain ▇▇▇▇ Parts selected by Bombardier to
ensure reasonable re-order lead times and emergency support.
Bombardier shall maintain a reasonable quantity of Bombardier
insurance parts. Insurance parts as used herein shall
include, but not be limited to, dispatch-essential parts such
as major flight control surfaces.
2.4 AGREEMENT TO PURCHASE ▇▇▇▇ PARTS
2.4.1 PURCHASE OF ▇▇▇▇ PARTS
[*DELETED IN ITS ENTIRETY]
2.4.2 BUYER'S RIGHT TO REDESIGN OR MANUFACTURE
Buyer's right to redesign or to have redesigned or
manufacture or to have manufactured ▇▇▇▇ Parts under the
following conditions:
a) When less than [* ] of the type purchased
hereunder are operated in scheduled commercial air
transport service;
b) Any time ▇▇▇▇ Parts are needed to effect emergency repairs
on the Aircraft, provided that such redesign or
manufacture allows Buyer to obtain ▇▇▇▇ Parts in less time
than Bombardier requires to furnish them; or
c) If Buyer has notified Bombardier in writing that any ▇▇▇▇
Parts are defective or unsatisfactory in use and if
within a reasonable period thereafter Bombardier has not
provided a satisfactory resolution or made redesigned
▇▇▇▇ Parts available.
Buyer's right to redesign or to have redesigned or
manufacture or to have manufactured ▇▇▇▇ Parts hereunder,
shall not be construed as a granting of a license by
Bombardier and shall not obligate Bombardier to disclose to
anyone Technical Data or other information nor to the payment
of any license fee or royalty or create any obligation
whatsoever to Bombardier and Bombardier shall be relieved of
any obligation or liability with respect to patent
infringement in connection with any such redesigned part.
Buyer shall be responsible for obtaining all regulatory
authority approvals required by Buyer to repair the Aircraft
using redesigned or manufactured ▇▇▇▇ Parts as described in
this preceding Article. Any such redesigned part shall be
identified with Buyer's part number only.
A-5
64
2.4.3 NOTICE TO BOMBARDIER OF REDESIGNED PARTS
Bombardier reserves the right to negotiate with Buyer the
access to redesigned parts, drawings and the exclusive
manufacturing rights of the redesigned part, if Buyer
redesigns or has had any ▇▇▇▇ Parts redesigned.
2.5 PURCHASE OF VENDOR PARTS & POWER PLANT PARTS
Bombardier shall not be obligated to maintain a stock of Power Plant
Parts. Bombardier shall maintain a spares stock of selected Vendor
Parts at its own discretion to support provisioning and replenishment
sales. Bombardier agrees to use reasonable efforts to require its
vendors to comply with the terms and conditions of this Annex A
Article 2 as they apply to Vendor Parts. Vendor Parts shall be
delivered in accordance with the vendor's quoted lead time plus
Bombardier's internal processing time.
2.6 SPARE PARTS PRICING
2.6.1 SPARE PARTS PRICE CATALOGUE
Prices for commonly used ▇▇▇▇ Parts stocked by Bombardier
shall be published in the spare parts price catalogue ("Spare
Parts Price Catalogue"). [*
].
2.6.2 BOMBARDIER PRICES FOR VENDOR PARTS
If Buyer orders Vendor Parts from Bombardier, the price shall
be as published in the Spare Parts Price Catalogue.
2.6.3 QUOTATIONS
Price and delivery quotations for items not included in the
Spare Parts Price Catalogue shall be provided at Buyer's
request by Bombardier. Price quotations will be held firm for
a period of ninety (90) calendar days or as otherwise
specified by Bombardier. Responses to quotation requests will
be provided within ten (10) calendar days.
2.6.4 PRICE APPLICABILITY
The purchase price of ▇▇▇▇ Parts shall be the applicable
price set forth in the Spare Parts Price Catalogue at time of
receipt by Bombardier of Buyer's Order or as quoted by
Bombardier to Buyer upon request. If Buyer requests
accelerated delivery or special handling for ▇▇▇▇ Parts not
included in the Spare Parts Price Catalogue, Bombardier may
increase the price from the original quotation to cover any
additional costs to Bombardier.
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2.6.5 CURRENCY AND TAXES
All Spare Parts Price Catalogue and quotation prices shall be
in U.S. dollars and exclusive of transportation, taxes,
duties and licenses.
Buyer shall pay to Bombardier upon demand the amount of any
sales, use, value-added, excise or similar taxes imposed by
any federal, provincial or local taxing authority within
Canada, and the amount of all taxes imposed by any taxing
authority outside Canada, required to be paid by Bombardier
as a result of any sale, use, delivery, storage or transfer
of any Spare Parts to or on behalf of Buyer. If Bombardier
has reason to believe that any such tax is applicable,
Bombardier shall separately state the amount of such tax in
its invoice. If a claim is made against Bombardier for any
such tax, Bombardier shall promptly notify Buyer.
In addition, Buyer shall pay to Bombardier on demand the
amount of any customs duties required to be paid by
Bombardier with respect to the importation by Buyer of any
Spare Parts.
2.6.6 VENDOR PRICING
Bombardier shall use reasonable efforts to require its major
vendors to [* ].
2.7 PROVISIONING
2.7.1 PRE-PROVISIONING/PROVISIONING CONFERENCE
Pre-provisioning and provisioning conferences shall be
convened on dates to be mutually agreed between Buyer and
Bombardier in order to:
(i) discuss the operational parameters to be provided by
Buyer to Bombardier which Bombardier considers necessary
for preparing its quantity recommendations for initial
provisioning of Spare Parts to be purchased from
Bombardier or vendors ("Provisioning Items");
(ii) review Buyer's ground support equipment and special tool
requirements for the Aircraft;
(iii) discuss the format of the provisioning documentation to
be provided to Buyer from Bombardier for the selection
of Provisioning Items; and
(iv) arrive at a schedule of events for the initial
provisioning process, including the establishment of a
date for the initial provisioning conference ("Initial
Provisioning Conference") which shall be scheduled as
mutually agreed and as early as practicable.
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The time and location of the pre-provisioning conference
shall be mutually agreed upon between the parties; however,
Bombardier and Buyer shall use their best efforts to convene
such meeting twelve (12) months prior to delivery of the
first Aircraft.
2.8 INITIAL PROVISIONING DOCUMENTATION
Initial provisioning documentation for ▇▇▇▇ Parts and Vendor Parts
shall be provided by Bombardier as follows:
a) Bombardier shall provide, as applicable to Buyer, promptly after
completion of the Initial Provisioning Conference, or as may be
mutually agreed, the initial issue of provisioning files as
required by ATA Specification 200, Chapter 1 (as may be amended
by Bombardier);
Revisions to this provisioning data shall be issued by Bombardier
every ninety (90) calendar days until ninety (90) calendar days
following the Delivery Date of the last Aircraft or as may be
mutually agreed;
b) Bombardier shall provide, as required by Buyer, all data files
defined in Chapter 1 of ATA Specification 200; and
c) the Illustrated Parts Catalogue designed to support provisioning
shall be issued concurrently with provisioning data files and
revised at ninety (90) calendar day intervals.
2.8.1 [*DELETED IN ITS ENTIRETY]
[*DELETED IN ITS ENTIRETY]
2.8.2 [*DELETED IN ITS ENTIRETY]
[*DELETED IN ITS ENTIRETY]
2.8.3 [*DELETED IN ITS ENTIRETY]
2.8.3.1 [*DELETED IN ITS ENTIRETY]
2.8.3.2 [*DELETED IN ITS ENTIRETY]
2.8.3.3 [* ] if requested by Buyer, Bombardier
agrees to consider but is not obligated to
repurchase used ▇▇▇▇ Parts at reasonable prices at
the time of said request.
2.8.4 EXCEPTIONS
[*DELETED IN ITS ENTIRETY].
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2.8.5 NOTIFICATION AND FORMAT
[*
].
Buyer's notification shall include a detailed summary, in
part number sequence, of the Provisioning Items [*
]. Such summary shall be in the form of listings as may be
mutually agreed between Bombardier and Buyer, and shall
include part number, nomenclature, purchase order number,
purchase order date and quantity [* ].
Within five (5) business days after receipt of Buyer's
notification Bombardier shall advise Buyer, in writing, when
Bombardier's review of such summary from Buyer will be
completed.
2.8.6 REVIEW AND ACCEPTANCE BY BOMBARDIER
Upon completion of Bombardier's review of any detailed
summary submitted by Buyer pursuant to Annex A Article
2.8.5., Bombardier shall issue [*
].
2.8.7 PRICE AND PAYMENT
2.8.7.1 [*DELETED IN ITS ENTIRETY]
2.8.7.2 [*DELETED IN ITS ENTIRETY]
2.8.7.3 [*DELETED IN ITS ENTIRETY]
2.8.8 [*DELETED IN ITS ENTIRETY]
[*DELETED IN ITS ENTIRETY]
2.8.9 [* ] -- TITLE AND RISK OF LOSS
[*DELETED IN ITS ENTIRETY]
[*DELETED IN ITS ENTIRETY]
2.9 PROCEDURE FOR ORDERING SPARE PARTS
Orders for Spare Parts may be placed by Buyer to Bombardier by any
method of order placement (including but not limited to SITA, ARINC,
telecopier, letter, telex, facsimile, telephone or hard copy purchase
order).
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2.9.1 REQUIREMENTS
Orders shall include at a minimum order number, part number,
nomenclature, quantity, delivery schedule requested, shipping
instructions and Bombardier's price, if available. Buyer
agrees that orders placed with Bombardier shall conform to
the requirements and procedures contained in ATA
Specification 200, as applicable to Buyer.
2.9.2 PROCESSING OF ORDERS
Upon acceptance of any Order, unless otherwise directed by
Buyer, Bombardier shall, if the Spare Parts are in stock,
proceed immediately to prepare the Spare Parts for shipment
to Buyer. If Bombardier does not have the Spare Parts in
stock, Bombardier shall proceed immediately to acquire or
manufacture the Spare Parts. Purchase order status and
actions related to the shipment of Spare Parts shall be
generally consistent with the provisions of the World Airline
Suppliers Guide and the applicable portions of ATA
Specification 200, as applicable to Buyer.
2.9.3 CHANGES
Bombardier reserves the right, without Buyer's consent, to
make any necessary corrections or changes in the design, part
number and nomenclature of Spare Parts covered by an Order,
to substitute Spare Parts and to adjust prices accordingly,
provided that interchangeability is not affected and the unit
price is not increased by more than 10% or $50.00, whichever
is less. Bombardier shall promptly give Buyer written notice
of corrections, changes, substitutions and consequent price
adjustments. Corrections, changes, substitutions and price
adjustments which affect interchangeability or exceed the
price limitations set forth above may be made only with
Buyer's consent, which consent shall conclusively be deemed
to have been given unless Buyer gives Bombardier written
notice of objection within fifteen (15) business days after
receipt of Bombardier's notice. In case of any objection, the
affected Spare Part will be deemed to be deleted from Buyer's
Order.
2.9.4 ELECTRONIC DATA INTERCHANGE
Should Bombardier implement an Electronic Data Interchange
("EDI") process for the order of spare parts for the Aircraft
or other products of Bombardier, Buyer and Bombardier hereby
agree to implement mutually acceptable procedures to
safeguard the security of the process and the validity of the
EDI orders.
2.10 PACKING
All Spare Parts ordered shall receive standard commercial packing
suitable for export shipment via air freight. Such standard packing
will generally be to ATA 300 standards
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as amended from time to time. All AOG orders will be handled,
processed, packed and shipped separately.
2.11 PACKING LIST
Bombardier shall insert in each shipment a packing list/release note
itemized to show:
(i) the contents of the shipment,
(ii) the approved signature of Bombardier's TC authority attesting
to the airworthiness of the Spare Parts which is the
equivalent to the FAA authorized Release Certificate 8130.
(iii) value of the shipment for customs clearance if required.
2.12 CONTAINER MARKS
Upon Buyer's request each container shall be marked with shipping
marks as specified on the Order. In addition Bombardier shall, upon
request, include in the markings: gross weight and cubic measurements.
2.13 DELIVERY, TITLE AND RISK OF LOSS
2.13.1 DELIVERY POINT
Spare Parts shall be delivered to Buyer in one of the
following manners at Bombardier's sole option:
(i) at Bombardier's plant in either ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇; or
(ii) at other Bombardier depots or shipping
points; or
(iii) at vendor's or subcontractor's plant.
In all cases ready for export with all costs of freight,
carriage or insurance to be borne by Buyer.
2.13.2 DELIVERY TIME
Bombardier shall use reasonable efforts so that shipment of
▇▇▇▇ Parts to Buyer be as follows:
A) AOG ORDERS
Ship AOG Orders within four (4) hours of receipt of
Order. Buyer's affected Aircraft factory production
number shall be required on AOG Orders;
B) CRITICAL ORDERS (A1)
Ship critical Orders within twenty-four (24) hours of
order receipt;
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C) EXPEDITE ORDERS (A2)
Ship expedite Orders within seven (7) calendar days of
order receipt; for stock items.
D) INITIAL PROVISIONING ORDERS
Prior to the Delivery Date of the first Aircraft or as may
be mutually agreed; and
E) OTHER ORDERS
Shipment of stock items shall be approximately within
thirty (30) calendar days or sooner after Bombardier's
receipt of Buyer's Order. Shipment of non-stock items
shall be in accordance with quoted lead times or lead
times published in the current Spare Parts Price
Catalogue, procurement data, or provisioning data.
2.14 COLLECT SHIPMENTS
Where collect shipments are not deemed practicable by Bombardier,
charges for shipment, insurance, prepaid freight charges and all other
costs paid by Bombardier shall be paid by Buyer promptly upon
presentation to Buyer of invoices covering the same.
2.15 FREIGHT FORWARDER
If Buyer elects to use the services of a freight forwarder for the
onward movement of Spare Parts, Buyer agrees to release Bombardier
from and indemnify it for any liability for any fines or seizures of
Spare Parts imposed under any governmental Goods in Transit
regulations. Any such fines levied against Bombardier will be invoiced
to Buyer and any Spare Parts seized under such regulations will be
deemed to be received, inspected, and accepted by Buyer at the time of
seizure.
2.16 REIMBURSEMENT OF EXPENSES
If Bombardier gives Buyer written notice that an Order is ready for
shipment and shipment is delayed more than thirty (30) days at Buyer's
request or without Bombardier's fault or responsibility, Buyer shall
promptly reimburse Bombardier upon demand for all costs and expenses,
including but not limited to reasonable amounts for storage, handling,
insurance and taxes, incurred by Bombardier as a result of such delay.
2.17 TITLE AND RISK OF LOSS
Title and risk of loss of the Spare Parts will pass to the Buyer upon
delivery by Bombardier. With respect to Spare Parts rejected by Buyer
pursuant to Annex A Article 2.19, risk of loss shall remain with Buyer
until such Spare Parts are re-delivered to Bombardier.
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Bombardier agrees to notify Buyer when material is shipped and shall
provide carrier's reference information (i.e., waybill number).
2.18 INSPECTION AND ACCEPTANCE
All Spare Parts shall be subject to inspection by Buyer at
destination. Use of Spare Parts or failure of Buyer to give notice of
rejection, within thirty (30) days after receipt or with respect to
latent defects only within thirty (30) days after discovery of such
latent defect, shall constitute acceptance. Acceptance shall be final
and Buyer waives the right to revoke acceptance for any reason,
whether or not known to Buyer at the time of acceptance. Buyer's
remedies for defects discovered before acceptance are exclusively
provided for in Annex A Article 2.19 herein.
2.19 REJECTION
Any notice of rejection referred to in Annex A Article 2.18 shall
specify the reasons for rejection. If Bombardier concurs with a
rejection, Bombardier shall, at its option, correct, repair or replace
the rejected Spare Parts. Buyer shall, upon receipt of Bombardier's
written instructions and Material Return Authorization ("MRA") number,
return the rejected Spare Parts to Bombardier at its specified plant,
or other destination as may be mutually agreeable. The return of the
rejected Spare Parts to Bombardier and the return or delivery of a
corrected or repaired rejected Spare Part or any replacement for any
such Spare Part to Buyer shall be at Bombardier's expense. Any
corrected, repaired or replacement Spare Parts shall be subject to the
provisions of this Agreement.
2.20 PAYMENT
Except as provided in Annex A Article 2.22 below, payment terms shall
be net thirty (30) calendar days of invoice date for established open
accounts [*
].
Any overdue amount shall bear interest from the due date until actual
payment is received by Bombardier at an annual rate of interest equal
to the U.S. prime interest rate as established from time to time by
The Chase Manhattan Bank, [* ] [* ] calculated and compounded
annually. In the event Buyer is not current on its account for the
purchase of spare parts and services under Annex A, Buyer shall at the
request of Bombardier provide Bombardier with such security as is
reasonably requested to secure payment of such account hereunder.
2.21 PAYMENT FOR PROVISIONING ITEMS
Payment for Provisioning Items shall be made by Buyer as follows:
a) [* ] of the total price of the Provisioning
Items as selected by Buyer, upon signature of the spares
provisioning document; and
b) the balance of the total price of Provisioning Items upon their
delivery.
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2.22 MODIFIED TERMS OF PAYMENT
Bombardier reserves the right to alter the terms of payment without
prior notice if Buyer fails to pay when due an amount Buyer owes under
any agreement with Bombardier.
2.23 REGULATIONS
Buyer shall comply with all applicable monetary and exchange control
regulations and shall obtain any necessary authority from the
governmental agencies administering such regulations to enable Buyer
to make payments at the time and place and in the manner specified
herein.
2.24 INTENTIONALLY DELETED
2.25 CANCELLATION OF ORDERS
Except as otherwise may apply to initial provisioning, if Buyer
cancels an Order, Bombardier, at its option, shall be entitled to
recover actual damages, but not less than the following cancellation
charges or more than the purchase price of the Spare Parts covered by
the Order:
a) if work accomplished on the Order has been limited to Bombardier
Spares Department, or the part has been identified as "shelf
stock" in the Spare Parts Price Catalogue, no cancellation
charges shall be made;
b) if production planning has been completed on the Order and shop
orders have been written, but no shop time or material charges
have been made against the Order, the cancellation charge shall
be 10% of the price but not to exceed $100 per unit;
c) if shop time or material charges have been made against the
Order, the cancellation charge shall be based on the direct and
indirect cost of such time and materials attributable to such
canceled order; and
d) if the Spare Parts covered by the Order can be absorbed into
Bombardier's inventory without increasing Bombardier's normal
maximum stock level, no cancellation charges shall be made.
2.26 LEASE
Bombardier shall select and make available certain parts for lease,
subject to availability Buyer has the option to negotiate a lease
agreement with Bombardier separate from this Agreement.
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2.27 ADDITIONAL TERMS AND CONDITIONS
Bombardier's conditions of sale are deemed to incorporate the terms
and conditions stated herein. Additional terms and conditions
applicable at time of receipt of each order from Buyer will be
mutually agreed upon and may be added providing such terms and
conditions do not conflict with the terms and conditions provided
herein. Such additional terms and conditions shall be provided to
Buyer at least ninety (90) calendar days prior to their effective
date.
ARTICLE 3 - TRAINING
3.1 GENERAL TERMS
3.1.1 The objective of the training programs (the "Programs"), as
described herein, shall be to familiarize and assist Buyer's
personnel in the introduction, operation, and maintenance of
the Aircraft.
Bombardier shall offer to the Buyer the Programs in the
English language at a Bombardier designated facility or such
other location as may be mutually agreed; the Programs shall
be completed prior to the Delivery Date of the last Aircraft
purchased herein. In the event training takes place at
Buyer's designated facility, Buyer shall be responsible for
all travel and living expenses of Bombardier's instructor
personnel.
3.1.2 Buyer shall be responsible for all travel and living expenses,
including local transportation, of Buyer's personnel incurred
in connection with the Programs.
3.1.3 The Programs shall be designed to reflect the model and/or
configuration of the Aircraft and may include differences
training to identify such configuration or model. Manuals
which are provided during the Programs exclude revision
service.
3.1.4 A training conference shall be held where possible not later
than thirty (30) days after execution of this Agreement or as
may be otherwise agreed, to establish the Programs' content
and schedule.
3.2 FLIGHT CREW TRAINING
3.2.1.1 FLIGHT CREW GROUND TRAINING
At no additional charge, Bombardier will provide for each
delivered Aircraft at such dates as are mutually agreed, FAA
approved transition training, approval for which has been
obtained by Buyer with Bombardier's assistance, for [* ]
of Buyer's crews [* ] who meet the minimum
entry requirement provided in the applicable training manual.
Each course shall consist of up to [* ]
of classroom instruction which may include part task trainer,
Computer Based Training (CBT), and/or Flight Training Device
(FTD).
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Bombardier shall furnish each of Buyer's licensed pilots
attending the course one copy of the Flight Crew Operating
Manual.
3.2.1.2 PILOT SIMULATOR TRAINING
Bombardier shall provide access to an FAA approved flight
simulator for each crew trained under Annex A Article 3.2.1.1
and 3.2. 2. Bombardier shall provide a simulator instructor
for [* ] for each crew trained on Bombardier's
designated simulator in Montreal; each mission shall consist
of [* ] in the simulator and required
briefing/debriefing sessions.
3.2.1.3 DIFFERENCES TRAINING
At Buyer's option, [*
] an FAA approved differences
training course for Buyer's pilots which will include pilot
ground training and simulator training, if required, in order
to enable a CRJ 200 pilot to be cross-trained into the
Aircraft. The quantity of pilots eligible to receive such
differences training provided hereunder [*
].
3.2.3 FLIGHT ATTENDANT COURSE
[* ] familiarization course for up to [* ] of
Buyer's flight attendant personnel shall be conducted. Each
course shall be for a maximum of [* ] duration.
This course shall present general information on the Aircraft
and detailed information on the operation of the passenger
safety equipment and emergency equipment. Bombardier shall
furnish for each participant in this course one (1) copy of
the Flight Attendant Training Guide which shall not be
revised. Buyer shall assist Bombardier in the development of
the Flight Attendant Training Guide to incorporate Buyer's
specific equipment and procedures.
3.2.4 FLIGHT DISPATCHER COURSE
[* ] course for up to [* ] of Buyer's flight
dispatch personnel shall be conducted. Each course shall be
for a maximum of [* ] duration. The course shall
consist of classroom instruction covering general Aircraft
familiarization, coverage of performance, flight planning,
weight and balance and the Minimum Equipment List. Bombardier
shall furnish for each participant in this course one (1)
copy of the Flight Crew Operating Manual which shall not be
revised.
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3.2.5 RECURRENT PILOT TRAINING
Bombardier shall, upon Buyer's request, provide a proposal
for an FAA approved course for type rated pilots, approval
for which will be sought by Buyer with Bombardier's
assistance, customized in content to meet the recurrent
training of Buyer's pilots.
3.2.6 COURSE TRAINING MATERIAL
Bombardier shall provide to Buyer, [*
] of the then
current training materials used to conduct Bombardier's
standard training as detailed herein:
i) 35 mm slides;
ii) Instructional Narrative and/or Instruction Guides;
iii) Overhead Projection Transparencies;
iv) Motion picture and/or Video tapes; and
v) Audio cassettes tapes.
vi) Airframe/Engine Maintenance Training Manual; and
vii) Avionics/Electrical Maintenance Training Manual; and
In lieu of the above course training material, Bombardier
shall provide complete and equivalent training materials as
may be developed in connection with Bombardier's standard
training program for the CL600-2C10 aircraft.
Flight Crew Ground Training Materials
Bombardier shall provide to the Buyer [*
] of the then
current manuals used to conduct the Flight Crew Ground
Training course, as follows:
i) Aircraft flight manual vol 1 & 2
ii) Flight crew operating manual vol 1& 2
iii) Quick reference handbook vol 1 & 2
iv) Flight planning and cruise control manual
v) Flight crew training manual
vi) Flight training control manual
vii) Pilot checklist and expanded checklist
viii)Study workbook and questions
ix) Training handout
x) All lessons plans including classroom, FTD, FFS and paper
copy of CBT lesson plans.
xi) All currently used overhead slides.
xii) Flight dispatcher lesson plans
xiii)Flight attendant operating manual & course material
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In lieu of the above, Bombardier shall provide complete and
equivalent training materials as may be developed in
connection with Bombardier standard training program for the
CL-600-2C10 aircraft.
3.3 MAINTENANCE TRAINING
3.3.0 Buyer shall have the option to take the training offered in
Article 3.3.1 and 3.3.2 below in any combination such that
the total number of mechanics trained per Aircraft does not
exceed [* ].
3.3.1 AIRFRAME AND POWERPLANT SYSTEMS MAINTENANCE COURSE
Subject to Article 3.3.0 of this Annex A, Bombardier shall,
at no additional charge, train up to [* ] of Buyer's
qualified personnel per Aircraft. This course shall emphasize
detailed systems description, operation, and routine line
maintenance practices. The course material shall be
principally mechanical with electrical and avionics
information for overall systems comprehension. The course
duration shall be for a maximum of [* ].
In the event a portion of the above training takes place by
mutual agreement at Buyer's designed facility, Buyer shall be
responsible for all travel and living expenses of
Bombardier's instructor personnel.
3.3.2 ELECTRICAL AND AVIONICS SYSTEMS MAINTENANCE COURSE
Subject to Article 3.3.0 of this Annex A, Bombardier shall,
at no additional charge, train up to [* ] of Buyer's
qualified personnel per Aircraft. The course shall emphasis
detailed systems description, operation and routine line
maintenance practices. The course material shall be
principally electrical and avionics but shall include
mechanical information for overall systems comprehension. The
course duration shall be for a maximum of [* ].
In the event a portion of the above training takes place by
mutual agreement at Buyer's designed facility, Buyer shall be
responsible for all travel and living expenses of
Bombardier's instructor personnel.
3.3.3 GROUND HANDLING COURSE
Bombardier shall, at no additional charge, provide
[* ] to train up to [* ] of Buyer's qualified
personnel. This course shall provide ramp service personnel
with training to be able to tow and park Aircraft and perform
routine ramp servicing tasks. Such training shall be
conducted in class with a practical demonstration on Buyer's
Aircraft after acceptance. The course duration shall be a
maximum of [* ] and the practical demonstration
shall not exceed [* ].
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3.3.4 EXECUTIVE GENERAL FAMILIARIZATION COURSE
Bombardier shall provide the services of an instructor to
conduct [* ] Executive General Familiarization
course [*
]. Buyer shall also provide an appropriate
classroom type facility in order to conduct the course at
their offices. The course shall generally describe the
Aircraft, the systems and the maintenance and support
requirements. This course is primarily designed for Buyer's
management personnel. The course duration is for a maximum of
[* ].
3.3.5 ENGINE RUN-UP COURSE
Bombardier shall provide [* ] Engine Run-up course, at
no additional charge, for up to [* ] of Buyer's
qualified personnel. This course enables Buyer's personnel to
gain proficiency in engine and APU runs, cockpit management
procedures, malfunctions and exceedences. A prerequisite for
this course is satisfactory completion of the Airframe and
Powerplant Systems Maintenance course. The course duration
shall be for a maximum of [* ].
3.3.6 SPECIALIST COURSES
At Buyer's request, Bombardier shall make a proposal for
specialist courses which will be derived from Bombardier's
standard courses detailed herein.
3.3.7 RECURRENT TRAINING
At Buyer's request, Bombardier shall make a proposal for an
FAA approved training plan for maintenance recurrent
training.
3.3.8 VENDOR TRAINING
At Buyer's request, Bombardier shall assist Buyer in
obtaining vendor maintenance training at Buyer's cost.
3.3.9 COURSE TRAINING MATERIAL
Bombardier shall provide to Buyer [*
]
of the then current training materials used to conduct
Bombardier's standard training as detailed herein:
i) 35 mm slides;
ii) Lesson Guides;
iii) Overhead Projection Transparencies;
iv) Motion picture and/or Video tapes; and
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v) Audio cassettes tapes.
vi) Airframe/Engine Maintenance Training Manual; and
vii) Avionics/Electrical Maintenance Training Manual.
In lieu of the above, Bombardier shall provide complete and
equivalent training materials as may be developed in
connection with Bombardier standard training program for the
CL-600-2C10 aircraft.
3.4 INSURANCE
3.4.1 Buyer shall at all times during flight training in
Buyer's Aircraft secure and maintain in effect, at
its own expense, insurance policies covering the
Aircraft including without limitation:
a) liability insurance covering public liability,
passenger, crew, property and cargo damage in
amounts not less than [*
] for any single occurrence;
b) all risk aircraft hull insurance for an amount
which is not less than its then fair market
value.
3.4.2 The liability policy shall name Bombardier (and its
affiliates) as additional insured. The hull policy
shall contain a waiver of subrogation in favour of
Bombardier (and its affiliates). All insurance
policies shall provide for payments despite any
misrepresentations or breach of warranty by any
person (other than the assured receiving payments)
and shall not be subject to any offset by any other
insurance carried by Bombardier except that Buyer
shall not be required to provide insurance with
respect to the manufacturing, repair and maintenance
activities of Bombardier (and of its affiliates) and
the related potential liability (product or
otherwise) arising therefrom.
3.5 START-UP TEAM
To assist Buyer in the introduction of the Aircraft into revenue
service, Bombardier will assemble a [* ] "start-up team" for
a period of up to [*
]. The base of operation and composition of this start-up team shall
be subject to discussion and could include operational, technical
and/or maintenance support personnel as well as instructor pilots.
ARTICLE 4 - TECHNICAL DATA
4.1 TECHNICAL DATA PROVIDED
Bombardier shall furnish to Buyer the Technical Data described in
Attachment A hereto (the "Technical Data"). The Technical Data shall
be in the English language and shall provide information on items
manufactured according to Bombardier's detailed design
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and in those units of measures used in the Specification or as may
otherwise be required to reflect Aircraft instrumentation as may be
mutually agreed.
4.2 SHIPMENT
All Technical Data provided hereunder shall be delivered to Buyer
ready for export with all costs of freight, carriage or insurance to
be borne by Buyer Bombardier's designated facilities and at the time
indicated in Attachment A.
4.3 PROPRIETARY TECHNICAL DATA
It is understood and Buyer acknowledges that the Technical Data
provided herein is proprietary to Bombardier and all rights to
copyright belong to Bombardier and the Technical Data shall be kept
confidential by Buyer. Buyer agrees to use the Technical Data solely
to maintain, operate, overhaul or repair the Aircraft or to make
installation or alteration thereto allowed by Bombardier.
Technical Data shall not be disclosed to third parties or used by
Buyer or furnished by Buyer for the design or manufacture of any
aircraft or Spare Parts including ▇▇▇▇ Partsor items of equipment,
except when manufacture or redesign is permitted under the provisions
of Annex A Article 2.4.2 and 2.4.3 hereof and then only to the extent
and for the purposes expressly permitted therein, and provided further
the recipient shall provide a non-disclosure undertaking acceptable to
Bombardier.
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ATTACHMENT A
LIST OF TECHNICAL DATA
COLUMN HEADING EXPLANATION OF CODES
ITEM
1 DOC DOCUMENT
Title of Technical Data provided.
2 CONFIG CONFIGURATION
G = Contains data common to all aircraft of the same type (Generic).
C = Contains data unique to Buyer's Aircraft (Customized).
3 MEDIUM Buyer selects one of the following media specified in the table:
= 1 Print two sides
= 2 Microfilm
= 3 Print one side
= 4 Laminated Cardboard
4 REVISION Y = Periodic revision service applies
N = Revision service not applicable
S = Revised as required by Bombardier
5 QUANTITY
(Number) = Quantity per the Agreement
(Number) PER = Quantity per Aircraft
6 DELIVERY
ATD = At time of the Delivery Date of the first Aircraft.
PTD = Prior to the Delivery Date of each or the first Aircraft
(as applicable).
7 ATA Y = Document is per ATA Specification 100, Revision 26.
N = Document is to Bombardier's existing commercial practices.
Bombardier will provide to Buyer at no additional charge technical manuals as
listed below
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TECHNICAL DATA
REGIONAL JET
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ITEM DOC CONF MEDIUM QTY REV DEL AT REMARKS
A
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1. AIRCRAFT MAINTENANCE G 1, 2 7 Y PTD Y
MANUAL (AMM)
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2. ILLUSTRATED PARTS G 1, 2 8 Y PTD Y
MANUAL/CATALOG (IPC)
--------------------------------------------------------------------------------------------------------------------------------
3. STRUCTURAL REPAIR MANUAL G 1, 2 8 Y PTD Y
(SRM)
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4. COMPONENT MAINTENANCE G 1, 2 3 Y PTD Y
MANUAL (CMM)
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5. POWER PLANT BUILD-UP G 1, 2 8 Y PTD Y
MANUAL
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6. WIRING DIAGRAM MANUAL C 1, 2 8 Y PTD Y
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7. ILLUSTRATED TOOL & G 1, 2 6 Y PTD Y
EQUIPMENT MANUAL (ITEM)
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8. SERVICE BULLETINS G 1 6 S PTD Y SEE NOTE 2
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9. NON DESTRUCTIVE G 1 6 Y PTD Y
TEST MANUAL (NDT)
--------------------------------------------------------------------------------------------------------------------------------
10. MAINTENANCE PROGRAM G 1 4 S PTD Y SEE NOTE 3
DOCUMENT (MPD)
--------------------------------------------------------------------------------------------------------------------------------
11. FAA OR DOT AIRPLANE FLIGHT C 1 4 S ATD N
MANUAL (AFM)
--------------------------------------------------------------------------------------------------------------------------------
12 WEIGHT & BALANCE MANUAL G 1 4 Y ATD Y
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13 MASTER MINIMUM EQUIPMENT G 1 0 S ASAP N
LIST (MMEL)
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14 QUICK REFERENCE HANDBOOK C 1 3 S ATD N
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15. FLIGHT CREW OPERATING C 1 5 S ATD N SEE NOTE 1
MANUAL (FCOM)
--------------------------------------------------------------------------------------------------------------------------------
16. MAINTENANCE TASK CARDS C 3 2 S PTD N
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17. ACCESS PANELS AND G 1 9 N PTD N
DOORS/COMPONENT LOCATION
MANUAL
--------------------------------------------------------------------------------------------------------------------------------
18. FLIGHT PLANNING & CRUISE G 1 3 S ASAP N
CONTROL MANUAL
--------------------------------------------------------------------------------------------------------------------------------
19. AIRCRAFT CHARACTERISTICS G 1 3 N ASAP N SEE NOTE 4
FOR AIRPORT PLANNING
--------------------------------------------------------------------------------------------------------------------------------
20. ON-BOARD WIRING DIAGRAM C 3 8 N ATD N SEE NOTE 5
BOOK
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21. MAINTENANCE FACILITIES & G 1 2 S ASAP N
EQUIPMENT PLANNING
MANUAL
--------------------------------------------------------------------------------------------------------------------------------
22. SYSTEM SCHEMATIC MANUAL G 1, 2 8 Y ATD Y SEE NOTE 1
(SSM)
--------------------------------------------------------------------------------------------------------------------------------
23. PASSENGER INFORMATION G 3 1 S ATD N SEE NOTE 6
SHEET
--------------------------------------------------------------------------------------------------------------------------------
24. PILOT CHECKLIST C 4 1 S ATD N
--------------------------------------------------------------------------------------------------------------------------------
25. CRASH CREW CHART G 4 4 S ATD N
--------------------------------------------------------------------------------------------------------------------------------
26. DISPATCH DEVIATION GUIDE G 1 5 S PTD N
--------------------------------------------------------------------------------------------------------------------------------
NOTE 1: REVISION SERVICE
A. Revision services shall only be available for [* ]
following the Delivery Date of Buyer's first Aircraft.
Subsequent revision service shall be provided free of charge
dependent upon incorporation of Bombardier issued Service
Bulletins.
B. Revisions to the Technical Data to reflect the Aircraft at
Delivery Date shall be provided to Buyer within six (6)
months following the Delivery Date of each of the Aircraft,
respectively.
C. Provided the revision service is being supplied under the
terms of this Agreement or by subsequent purchase order,
Bombardier shall incorporate in the applicable documents all
applicable Bombardier originated Service Bulletins in a
regular revision following formal notification by Buyer that
such Service Bulletins shall be accomplished on the Buyer's
Aircraft. The manuals shall then contain both original and
revised configuration until Buyer advises Bombardier in
writing that one configuration is no longer required.
NOTE 2: SERVICE BULLETINS
Aperture cards of the service drawing(s) will be provided in
lieu of drawings when practical.
NOTE 3: MAINTENANCE PROGRAM DOCUMENT
This manual provides the basis for Buyer's initial
maintenance program.
NOTE 4: AIRCRAFT CHARACTERISTICS FOR AIRPORT PLANNING
This manual contains data on Aircraft ground maneuver and
handling.
NOTE 5: ON-BOARD WIRING DIAGRAM BOOK
This book contains wiring diagrams for interim reference
until the Wiring Diagram Manual is revised to reflect the
Aircraft at the Delivery Date.
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NOTE 6: PASSENGER INFORMATION CARDS
Bombardier will provide one (1) reproducible master for the
preparation of passenger information cards. For an additional
cost, subject to negotiation, Bombardier will provide full
colour laminated passenger information cards in quantities
required.
▇-▇▇
▇▇
▇▇▇▇▇ "▇"
▇▇▇▇▇▇▇▇ AND SERVICE LIFE POLICY
ARTICLE 1 - WARRANTY
The following warranty and service life policy is that to which reference is
made in Article 3 of this Agreement.
1.1 WARRANTY
1.1.1 Subject to Annex B Articles 1.9, 1.10, and 2, Bombardier
warrants that, at the date of delivery of the Aircraft or
▇▇▇▇ Part, as applicable :
a) the Aircraft shall conform to the Specification, except
that any matter stated in the Specification as type
characteristics, estimates or approximations is excluded
from this Warranty;
b) the Aircraft shall be free from defects caused by the
failure of Bombardier to install a Vendor Part or
Powerplant Part in accordance with reasonable
instructions of the vendor;
c) the [*
which shall be governed by Article 2 hereof, shall be free
from defects in material or workmanship [* ];
d) the [* ] shall be free from defects in design
including [* ], having regard to the state of
the art as of the date of such design; and
e) the Aircraft computer systems (hardware and software)
that process date data shall do so correctly in the year
2000.
1.1.2 The Warranty set forth in Annex B Article 1.1.1 (c), (d) and
(e) above shall also be applicable to ▇▇▇▇ Parts purchased as
Spare Parts.
1.1.3 Bombardier further warrants that, at the time of delivery,
the Technical Data shall be free from error.
B-1
85
1.2 WARRANTY PERIOD
1.2.1 The Warranty set forth in Annex B Article 1.1 shall remain in
effect for any defect covered by the Warranty (a "Defect")
becoming apparent during the following periods (individually,
the "Warranty Period"):
a) for failure to conform to the Specification and the
installation referred to in Annex B Article 1.1.1 (a) and
1.1.1 (b), [* ] from the Delivery Date;
b) for those Defects in material or workmanship referred to
in Annex B Article 1.1.1 (c) and 1.1.2, [* ]
from the date of delivery of the Aircraft or ▇▇▇▇ Part as
applicable;
c) for those Defects in design referred to in Annex B
Article 1.1.1 (d) or 1.1.2, [* ] from the date of
delivery of the Aircraft or ▇▇▇▇ Parts as applicable; and
d) for Defects in the Aircraft computer systems that process
date data referred to in Annex B Article 1.1.1 (e), from
January 1, 2000 to December 31, 2000; and
e) for errors in the Technical Data referred to in Annex B
Article 1.1.3, [* ] from the date of delivery of
the applicable Technical Data.
1.3 REPAIR, REPLACEMENT OR REWORK
As to each matter covered by this Warranty Bombardier's sole
obligation and liability under this Warranty is expressly limited to,
at Bombardier's election, correction by the repair, replacement or
rework of the defective part or item of Technical Data. The repaired,
replaced or reworked part or item of Technical Data which is the
subject of the Warranty claim shall then be warranted under the same
terms and conditions for the then unexpired portion of the Warranty
Period.
In the case of a Defect relating to non-conformance with the
Specification, Bombardier shall correct that Defect in the equipment
item or part in which the Defect appears, except that Bombardier will
not be obligated to correct any Defect which has no material adverse
effect on the maintenance, use, performance (as measured by reference
to the performance [* ], or operation of the Aircraft.
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1.4 CLAIMS INFORMATION
Bombardier's obligations hereunder are subject to a Warranty claim to
be submitted in writing to Bombardier's warranty administrator, which
claim shall include but not be limited to the following information:
a) the identity of the part or item involved, including the part
number, serial number, if applicable, nomenclature and the
quantity claimed to be defective;
b) the manufacturer's serial number of the Aircraft from which the
part was removed;
c) the date the claimed Defect became apparent to Buyer;
d) the total flight hours (and cycles if applicable) accrued on the
part at the time the claimed Defect became apparent to Buyer; and
e) a description of the claimed Defect and the circumstances
pertaining thereto.
1.5 Intentionally deleted.
1.6 TIMELY CORRECTIONS
Bombardier shall, at its expense, make the repair, replacement or
rework, following receipt of the defective part or item, with
reasonable care and dispatch.
1.7 LABOUR REIMBURSEMENT
For correction of Defects, Bombardier shall establish a reasonable
estimate for the labour hours required for the repair, replacement or
rework of the defective item and, if the repair, replacement or rework
is performed by Buyer, Bombardier shall reimburse Buyer for Bombardier
estimated hours or for Buyer's actual labour hours, whichever is less,
for the repair, replacement or rework of the defective item (but
excluding any work necessary to otherwise conduct maintenance work on
the Aircraft containing such item). For purposes hereof, Buyer's
labour rate for any labour hours expended shall be [*
] of Buyer's average direct hourly labour
rate. For this purpose, Buyer's "average direct hourly labour rate"
means the average hourly rate (excluding all fringe benefits, premium
time allowances, social charges, business taxes and the like) paid to
Buyer's employees whose jobs are directly related to the performance
of the repair or modification. Prior to or concurrent with submittal
of Buyer's first claim for labour reimbursement hereunder, Buyer shall
notify Bombardier of Buyer's then current average direct hourly labour
rate, and thereafter Buyer shall promptly notify Bombardier of any
significant change in such rate. If requested, Buyer shall furnish to
Bombardier such data as may be reasonably required to substantiate
such rate. The labour cost to be reimbursed by Bombardier as aforesaid
shall account for disassembly, repair, reassembly,
B-3
87
final inspection and test specific to the repair of the ▇▇▇▇ Part.
Buyer shall retain all defective items for a period of ninety (90)
days after the date of completion of repair. At Bombardier's request,
such items are to be returned to Bombardier's designated facilities,
within fifteen (15) days from receipt of such request, with all costs
thereof being borne by Bombardier.
1.8 APPROVAL, AUDIT, TRANSPORTATION AND WAIVER
All Warranty claims shall be subject to audit and approval by
Bombardier. Bombardier will use reasonable efforts to advise in
writing the disposition of Buyer's Warranty claim within thirty (30)
days following the receipt of the claim and (if requested) return of
the defective ▇▇▇▇ Part to Bombardier's designated facility.
Bombardier shall notify Buyer of Bombardier's disposition of each
claim provided that Buyer shall not be prevented from disputing same.
Buyer shall pay all costs of transportation of the defective part from
Buyer to Bombardier's U.S. distribution centre and Bombardier shall
pay all costs of transportation of the repaired, corrected or
replacement parts back to Buyer.
1.9 LIMITATIONS
1.9.1 Bombardier shall be relieved of and shall have no obligation
or liability under this Warranty if:
a) the Aircraft was operated with any products or parts not
specifically approved by Bombardier, unless such products
or parts were not a cause of the Defect, provided that,
if requested by Bombardier, Buyer furnishes reasonable
evidence to that effect; or
b) the Aircraft was not operated or maintained in accordance
with the Technical Data listed in Attachment A of Annex A
as may be revised and the manufacturer's documentation
furnished to Buyer (including Service Bulletins and
airworthiness directives) unless such operation or
maintenance was not cause of the Defect, provided that,
if requested by Bombardier, Buyer furnishes reasonable
evidence to that effect; or
c) the Aircraft was not operated under normal airline use,
unless such operation was not a cause of the Defect,
provided that, if requested by Bombardier, Buyer
furnishes reasonable evidence to that effect; or
B-4
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d) Buyer does not
1) report the Defect in writing to Bombardier's
Warranty administrator within [*
] following such Defect becoming actually known
to Buyer, and
2) retain the ▇▇▇▇ Part claimed to be defective until
advised by Bombardier to return such ▇▇▇▇ Part to
Bombardier's designated facility in order for
Bombardier to finalize its evaluation of the
Warranty claim or to otherwise dispose of such ▇▇▇▇
Part; or
e) if Bombardier rejects any claims submitted by Buyer
hereunder, Bombardier shall notify Buyer of such
rejection and Buyer shall submit reasonable proof to
Bombardier within thirty (30) calendar days thereafter
that the rejected claim is covered within this Warranty;
or
f) Buyer does not allow Bombardier reasonable opportunity
(taking into account Buyer's wish to return the Aircraft
to service) to be present during the disassembly and
inspection of the ▇▇▇▇ Part claimed to be defective.
1.9.2 The warranties contained in this Annex B do not apply to Buyer
Furnished Equipment.
1.10 NORMAL USAGE
Normal wear and tear and the need for regular maintenance and overhaul
shall not constitute a Defect or failure under this Warranty.
1.11 OVERHAUL OF WARRANTY PARTS
Bombardier's liability for a ▇▇▇▇ Part which has a Defect and is
overhauled by Buyer within the Warranty Period shall be limited only
to that portion of the labour and material replacement related to the
Defect.
1.12 NO FAULT FOUND
In the event that Buyer submits ▇▇▇▇ Parts for repair, correction or
replacement under a warranty claim and such ▇▇▇▇ Parts are determined
by Bombardier to be serviceable (such submissions being hereinafter
referred to as a "No Fault Claim") Bombardier shall have the right
should Buyer's number of No Fault Claims be determined by Bombardier
to be excessive taking into account the length of Buyer's experience
with maintaining the Aircraft and other operators experience with a
given ▇▇▇▇ Part, to charge and recover from Buyer, and Buyer shall pay
Bombardier's reasonable costs incurred by Bombardier in connection
with Buyer's No Fault Claims. Providing, however, in the event that
B-5
89
repetitive in service failure occurs on the particular ▇▇▇▇ Part which
is subsequently identified by Bombardier on a repeated basis to be "no
fault found", then Bombardier and Buyer shall discuss and mutually
agree a course of further action to help identify the problem. In the
event the fault is ultimately confirmed to be a legitimate Warranty
claim then the above mentioned costs incurred by Bombardier and
charged to Buyer shall be waived [* ].
ARTICLE 2 - VENDOR WARRANTIES
2.1 WARRANTIES FROM VENDORS
The Warranty provisions of this Annex B do not apply to Vendor Parts
or Power Plant Parts. However, Bombardier has made or shall make
reasonable efforts to obtain favourable warranties from vendors, with
respect to Vendor Parts and Power Plant Parts. Except as specifically
provided under this Annex B Article 2, Bombardier shall have no
liability or responsibility for any such Vendor Parts and Power Plant
Parts and the warranties for those Vendor Parts and Power Plant Parts
shall be the responsibility of the vendor and a matter as between
Buyer and vendor; provided that if reasonably required in connection
with Buyer's enforcement of such warranties Bombardier shall execute a
mutually acceptable assignment of such warranty rights.
2.2 VENDOR WARRANTY BACKSTOP
For those Vendor Parts installed on the Aircraft at the Delivery Date
or subsequently purchased through Bombardier, excluding the Power
Plant Parts, in the event the parties agree that a vendor is in
default in the performance of any material obligation under any
applicable warranty obtained by Bombardier from such vendor pursuant
to Annex B Article 2.1 above, the warranties and all other terms and
conditions of Annex B Article 1 shall become applicable as if the
Vendor Parts had been a ▇▇▇▇ Part, except that the warranty period
shall be the Warranty Period as set forth herein or by the vendor's
warranty, whichever is shorter.
2.3 BOMBARDIER'S INTERFACE COMMITMENT
In the event of a dispute in the application of a Vendor Part
warranty, at Buyer's request addressed to Bombardier's warranty
administrator, Bombardier shall, without charge, conduct an
investigation and analysis of any such dispute resulting from a
technical interface problem to determine, if possible, the cause of
the interface problem and then recommend feasible corrective action.
Buyer shall furnish to Bombardier all data and information in Buyer's
possession relevant to the interface problem and shall cooperate with
Bombardier in the conduct of its investigation and such tests as may
be required. Bombardier, at the conclusion of its investigation, shall
advise Buyer in writing of Bombardier's opinion as to the cause of the
problem and Bombardier's recommended corrective action.
B-6
90
2.4 BOMBARDIER' ASSISTANCE IN ADMINISTRATION OF VENDOR WARRANTIES
Buyer will be responsible for submitting warranty claims directly to
Vendors; however, if Buyer experiences problems enforcing any Vendor
warranty obtained by Bombardier for Buyer, Bombardier will conduct an
investigation of such problems and assist Buyer in the resolution of
such claims.
ARTICLE 3 - SERVICE LIFE POLICY
3.1 APPLICABILITY
[*DELETED IN ITS ENTIRETY]
3.2 TERM
Should such failures occur in any Covered Component within [*
] following delivery of the Aircraft containing such
Covered Component, Bombardier shall, as promptly as practicable and at
its option;
a) design and/or furnish a correction for such failed Covered
Component; or
b) furnish a replacement Covered Component (exclusive of
standard parts such as bearings, bushings, nuts, bolts,
consumables and similar low value items).
3.3 PRICE
Any Covered Component which Bombardier is required to furnish under
this SLP shall be provided for at a price calculated in accordance
with the following formula:
P = [* ]
[* ]
Where:
P = [*DELETED IN ITS ENTIRETY]
C = [*DELETED IN ITS ENTIRETY]
T = [*DELETED IN ITS ENTIRETY]
3.4 CONDITIONS AND LIMITATIONS
3.4.1 The following general conditions and limitations shall apply to
the SLP:
a) [*DELETED IN ITS ENTIRETY]
B-7
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b) if Bombardier rejects any claim under the SLP submitted
by Buyer hereunder, Bombardier shall notify Buyer of such
rejection and Buyer must submit reasonable proof to
Bombardier within [* ] thereafter that the
rejected claim is covered within this SLP;
c) Buyer shall report any failure of a Covered Component in
writing to Bombardier's Warranty administrator within two
(2) months after such failure becomes actually known to
Buyer. [*
].
d) the provisions of Annex B Article 1.9 of the Warranty
(except for subparagraphs (d) and (e) thereof) are
incorporated by this reference and shall condition
Bombardier's obligations under this SLP with respect to
any Covered Component;
e) Bombardier's obligations under this SLP shall not apply
to any Aircraft which has not been correctly modified in
accordance with the specifications or instructions
contained in the relevant Service Bulletins which are
furnished to Buyer prior to receipt by Bombardier from
Buyer of any notice of an occurrence which constitutes a
failure in a Covered Component subject to [*
]. The provisions of this
subparagraph shall not apply in the event that Buyer
furnishes reasonable evidence acceptable to Bombardier
that such failure was not caused by Buyer's failure to so
modify the Aircraft;
f) this SLP shall not apply to a Covered Component where the
failure results from an accident, abuse, misuse,
degradation, except for normal wear and tear, negligence
or wrongful act or omission, unauthorized repair or
modification adversely affecting a Covered Component,
impact or foreign object damage, to any Covered
Component.
3.5 COVERAGE
This SLP is neither a warranty, performance guarantee nor an agreement
to modify the Aircraft to conform to new developments in design and
manufacturing art. Bombardier's obligation is only to provide
correction instructions to correct a Covered Component or furnish
replacement at a reduced price as provided in this SLP.
3.6 COVERED COMPONENT
Only those items or part thereof listed in Attachment A to this Annex
B shall be deemed to be a Covered Component, and subject to the
provisions of this SLP.
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ARTICLE 4 - GENERAL
4.1 It is agreed that Bombardier shall not be obligated to provide to
Buyer any remedy which is a duplicate of any other remedy which has
been provided to Buyer under any other part of this Annex B.
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ANNEX B - ATTACHMENT A
COVERED COMPONENTS
1. WING
a. [*DELETED IN ITS ENTIRETY]
b. [*DELETED IN ITS ENTIRETY].
c. [*DELETED IN ITS ENTIRETY]
d. [*DELETED IN ITS ENTIRETY]
e. [*DELETED IN ITS ENTIRETY]
f. [*DELETED IN ITS ENTIRETY]
g. [*DELETED IN ITS ENTIRETY]
h. [*DELETED IN ITS ENTIRETY]
i. [*DELETED IN ITS ENTIRETY]
j. [*DELETED IN ITS ENTIRETY].
2. FUSELAGE
a. [*DELETED IN ITS ENTIRETY]
b. [*DELETED IN ITS ENTIRETY]
c. [*DELETED IN ITS ENTIRETY]
d. [*DELETED IN ITS ENTIRETY]
e. [*DELETED IN ITS ENTIRETY]
3. VERTICAL STABILIZER
a. [*DELETED IN ITS ENTIRETY]
b. [*DELETED IN ITS ENTIRETY]
Initials
Buyer Bombardier
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B-10
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c. [*DELETED IN ITS ENTIRETY].
d. [*DELETED IN ITS ENTIRETY].
e. [*DELETED IN ITS ENTIRETY]
4. HORIZONTAL STABILIZER
a. [*DELETED IN ITS ENTIRETY]
b. [*DELETED IN ITS ENTIRETY]
c. [*DELETED IN ITS ENTIRETY]
B-11
Initials
Buyer Bombardier
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95
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-01
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12 Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
In consideration of Buyer having entered into the above referenced Agreement,
Bombardier agrees to provide Buyer with purchase rights for additional Aircraft
under the following general conditions:
1.0 Bombardier hereby offers to Buyer purchase rights for up to eight (8)
incremental Aircraft. The incremental Aircraft are hereinafter called
the "Incremental Aircraft".
2.0 The Incremental Aircraft will be offered in two (2) blocks of four (4)
aircraft. The Incremental Aircraft will be offered for acceptance to
Buyer at Bombardier's offices or premises in Montreal, Province of
Quebec, Canada, for immediate export, and otherwise in accordance with
the acceptance and delivery procedures provided for in the Agreement.
3.0 The delivery date of [* ] Incremental Aircraft shall be mutually agreed
upon by Bombardier and Buyer and are subject to availability of the
desired delivery positions prior to Buyer reserving said positions.
Delivery dates of [* ] shall be between
Initials
Buyer Bombardier
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96
Page 2
[* ]. Delivery shall be at a rate not to exceed two Incremental
Aircraft per month.
4.0 Delivery positions for [* ] of Incremental Aircraft may be reserved by
Buyer, subject to availability, by giving Bombardier a written notice,
[* ] of its intention to purchase [* ] Incremental Aircraft. Bombardier
shall within fifteen (15) days of Buyer's notice, advise Buyer of the
availability of the delivery dates for the relevant blocks of
Incremental Aircraft.
5.0 Buyer shall confirm its exercise of its right to purchase a block of
Incremental Aircraft by irrevocable written notice to Bombardier [* ]
prior to the delivery date of the first Incremental Aircraft in said
block. At that time the [* ] shall apply to the exercised Incremental
Aircraft and shall be amended to include such Incremental Aircraft.
6.0 The price of the Incremental Aircraft shall be the price stated in
Article 4.0 of the Agreement, subject to escalation in accordance with
the Agreement and provisions of Appendix I of the Agreement. The terms
and conditions of the Agreement shall be applicable mutatis mutandis to
the purchase of the Incremental Aircraft, [* ]. Upon exercise of the
option to purchase any Incremental Aircraft, the Agreement shall be
amended accordingly.
7.0 The basic configuration on the Aircraft as described in Article 2 and
Appendix III of the Agreement may be changed from time to time, leading
to adjustments in the price of the basic Aircraft over the anticipated
delivery schedule. In the event of changes to the basic Aircraft
configuration, Bombardier and Buyer will discuss and agree as to
whether these changes are to be incorporated in the Incremental
Aircraft configuration for Buyer, and if so on a mutually acceptable
adjustment to the Incremental Aircraft price.
8.0 [*Deleted in its entirety].
9.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
10.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail.
Initials
Buyer Bombardier
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Page 3
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
--------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __ th day of September, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ AIRLINES, INC.
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
Initials
Buyer Bombardier
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98
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-02
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
1.0 [*Deleted in its entirety].
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Page 2
2.0 [*Deleted in its entirety].
3.0 [*Deleted in its entirety].
4.0 [*Deleted in its entirety].
5.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed by Buyer without the prior written
consent of Bombardier.
6.0 This Letter Agreement constitutes and integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
7.0 In the event of termination of the Agreement this Letter Agreement
shall survive termination until the advance payments have been disposed
of in accordance with the Agreement.
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Page 3
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
---------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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[* DELETED IN ITS ENTIRETY]
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103
ANNEX A
[* DELETED IN ITS ENTIRETY]
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Page 2
ANNEX B
[*DELETED IN ITS ENTIRETY]
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Page 3
ANNEX C
[*DELETED IN ITS ENTIRETY]
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September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-03
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
In consideration of Buyer having entered into the above referenced Agreement,
Bombardier agrees to provide Buyer with the following benefits under the general
conditions outlined below:
1.0 Maintenance Planning Support
1.1 Maintenance System
The Maintenance Programs for the Canadair Regional Jet Series
700 aircraft will be developed and maintained using the MSG-3
philosophy.
1.2 Development of Maintenance System
The Maintenance System is reviewed and amended regularly by
the Maintenance Review Board ("MRB"). The MRB meets on a
regular basis, nominally twelve (12) months for new designs
and eighteen (18) months for a mature aircraft type to
continuously improve the program. Buyer will be extended the
opportunity to participate in the MRB process.
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1.3 Canadair Regional Jet Series 700 Maintenance Schedule
The MRB process will establish the appropriate intervals for
the following checks based on the MSG-3 philosophy:
Service Check
Routine Check
"A" Check
"C" Check
1.4 Maintenance Cost Control
The Maintenance Cost Control department within Bombardier
monitors the direct maintenance costs of the Canadair Regional
Jet Series 700 at both a complete aircraft and component
level. The resulting normalized data is compared to target
levels and those exceeding expectations are analyzed to
determine the required action to bring the cost within target.
2.0 [* ]
2.1 [* Deleted in its entirety]:
a) [* Deleted in its entirety];
b) [* Deleted in its entirety];
c) [* Deleted in its entirety];
d) [* Deleted in its entirety].
2.2 [* ]:
a) [* Deleted in its entirety];
b) [* Deleted in its entirety];
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c) [* Deleted in its entirety]
d) [* Deleted in its entirety]:
[* Deleted in its entirety]
[* Deleted in its entirety]
[* Deleted in its entirety]
[* Deleted in its entirety]
2.3 [* Deleted in its entirety]
3.0 [* Deleted in its entirety]
4.0 [* Deleted in its entirety].
5.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
6.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
---------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
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ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-04
Reference is made to Purchase Agreement No. P.A.-0372 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
In consideration of Buyer having entered into the above referenced Agreement,
Bombardier agrees to provide Buyer with the following [* ]:
1.0 Intent
[* Deleted in its entirety].
2.0 Definition
[* Deleted in its entirety].
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3.0 [* ]
3.1 [*Deleted in its entirety]
4.0 Term [* ]
The term of this [* ] shall commence on [* ] and shall expire [* ]
thereafter.
5.0 Formula
[*Deleted in its entirety]
6.0 Assumptions
[*Deleted in its entirety].
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7.0 Conditions and Limitations
7.1 [*Deleted in its entirety]:
a) [*Deleted in its entirety];
b) [*Deleted in its entirety];
c) [*Deleted in its entirety];
d) [*Deleted in its entirety];
e) [*Deleted in its entirety];
f) [*Deleted in its entirety];
g) [*Deleted in its entirety].
7.2 Reporting
Buyer shall provide to Bombardier not later than
[* ] after the last day of each month all reports submitted to
the FAA [* ]. Buyer shall also provide a report to Bombardier
of the [* ], and the information on [* ] accomplished during
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each month. Buyer shall also provide Bombardier such other
information and data as Bombardier may reasonably request for
the purpose of analyzing [* ]. Bombardier shall respond to the
data in a timely manner and shall provide Buyer with a summary
of [* ].
7.3 Verification
Buyer hereby grants Bombardier the right to verify all Buyer's
data reported under this Letter Agreement during Buyer's
normal business hours at Bombardier's expense and within a
reasonable time after written notification by Bombardier to
Buyer. Such verification shall include a review of Buyer's
[*] (where normally and customarily maintained) pertaining to
[*]. Bombardier's verification procedure shall not interfere
with the conduct of business by Buyer nor shall Buyer be
required to undertake or incur additional liability or
obligations with respect to the verification procedure.
7.4 Master Record
[* ] will be maintained by Bombardier based upon information
provided by Buyer's [* ] as requested herein.
Bombardier shall format the data into Bombardier's format.
8.0 Corrective Action
8.1 In the event the [* ], as reported to Buyer by Bombardier,
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[* ], Bombardier and Buyer will jointly review the [* ] to
identify improvement changes required. Bombardier shall also
provide, at no charge, if requested by Buyer:
a) [*Deleted in its entirety];
b) [*Deleted in its entirety];
c) [*Deleted in its entirety]
d) Bombardier shall use its reasonable efforts to
require its suppliers to provide corrective action at
no charge to Buyer to the extent required when [* ]
as a direct result of failure of equipment designed
by such suppliers.
8.2 Bombardier's liability to investigate and provide corrective
action under the terms of [* ] pursuant to Article 7.2 hereof;
provided, that in the event Buyer shall fail to [* ] under
Article 7.2 hereof, Bombardier shall
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provide notice of such failure to Buyer and Buyer shall have
fifteen (15) days after such notice to [* ].
9.0 Implementation of Changes
Buyer may, at its option, decline to implement any change proposed by
Bombardier under Article 8.0 above. If Buyer so declines, Bombardier
[*] based on reasonable substantiation to Buyer and on other operator
experience, if any, as if such change has been incorporated. Bombardier
shall not make adjustments when Buyer has demonstrated to Bombardier's
reasonable satisfaction that such change is not cost effective to
Buyer.
10.0 Duplicate Remedies
It is agreed that Bombardier shall not be obligated to provide to Buyer
any remedy which is a duplicate of any other remedy which has been
provided to Buyer elsewhere under the Agreement.
11.0 In the event of termination of the Agreement, subject to the provisions
of Article 3.0 above, this Letter Agreement shall survive termination
with respect to all delivered Aircraft under the Agreement.
12.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail. Without limiting the
foregoing, the parties agree that Article 19 of the Agreement is fully
applicable to this Letter Agreement.
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116
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft Division
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-05
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
In consideration of Buyer having entered into the above referenced Agreement,
Bombardier agrees to provide Buyer with the following [* ]:
1.0 Intent
1.1 [*Deleted in its entirety].
1.2 [*Deleted in its entirety].
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2.0 [* Deleted in its entirety]
2.1 [* Deleted in its entirety]:
2.1.1 The term of this Letter Agreement shall commence on
[* ]; and
2.1.2 [* Deleted in its entirety]:
a) [* Deleted in its entirety];
b) [* Deleted in its entirety];
c) [* Deleted in its entirety];
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119
d) [* Deleted in its entirety]
e) [* Deleted in its entirety].
3.0 Calculation of Cost
3.1 [* Deleted in its entirety]
[* Deleted in its entirety]
3.2 [* Deleted in its entirety]
[* Deleted in its entirety].
3.3 [* Deleted in its entirety]
[* Deleted in its entirety].
3.4 [* Deleted in its entirety]
[* Deleted in its entirety]:
[* Deleted in its entirety]
Where:
[* Deleted in its entirety]
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4.0 [* ]
4.1 [* Deleted in its entirety].
4.2 [* Deleted in its entirety].
[* Deleted in its entirety]
Where:
[* Deleted in its entirety]
4.3 [* Deleted in its entirety]:
[* Deleted in its entirety]
Where:
[* Deleted in its entirety]
[* Deleted in its entirety]
5.0 [* ]
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5.1 [* Deleted in its entirety].
[* Deleted in its entirety]
[* Deleted in its entirety].
5.2 [* Deleted in its entirety].
5.3 [* Deleted in its entirety].
6.0 Audit
Upon ten (10) business days prior written notification by Bombardier to
Buyer and at Bombardier's expense, Bombardier shall have the right
during normal business hours to audit all [* ] reported under this
Letter Agreement, [* ], where normally and customarily maintained, [*
]. Such audit shall not interfere with the conduct of business by Buyer
nor shall Buyer be required to undertake or incur additional liability
or obligations with respect to the audit. Bombardier shall take
reasonable efforts to keep confidential the [* ] obtained from Buyer.
7.0 Reporting
7.1 Bombardier shall provide a quarterly report to Buyer [* ]
based on data submitted by Buyer and approved by Bombardier.
Failure of Buyer to provide the required data, in spite of
Bombardier's notice and within thirty (30) days thereof, shall
[* ] provided, that Bombardier shall notify Buyer of any such
failure and Buyer shall have thirty (30) days after its
receipt of such notice to cure such failure [* ].
7.2 [* ] was based upon the assumption outline in the Appendix to
this Letter Agreement. Any deviation from the assumptions
outlined in the Appendix shall cause a modification in the [*
] to be performed by Bombardier with the consent of Buyer such
consent not to be unreasonably withheld.
8.0 Subject to 9.0 hereof, upon termination of the Agreement, this Letter
Agreement shall survive termination with respect to all delivered
Aircraft under the Agreement.
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9.0 In the event there is a change to the delivery schedule as originally
contemplated in Appendix II or if [* ], the parties hereto shall agree
[* ].
10.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
11.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail. Without limiting the
foregoing, the parties agree that Article 19 of the Agreement is fully
applicable to this Letter Agreement.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC. BOMBARDIER INC.
--------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
---------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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APPENDIX A
AIRFRAME DIRECT MAINTENANCE COST GUARANTEE
[* Deleted in its entirety]
[* Deleted in its entirety]
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[* ]
CONT'D
9. [* Deleted in its entirety]
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September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇.▇.▇., ▇▇▇▇▇-▇▇▇▇
Gentlemen,
Re: Letter Agreement No. 0430-06
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
1.0 Aircraft Configuration
[* Deleted in its entirety].
2.0 [* Deleted in its entirety]
2.1 [* Deleted in its entirety]
[* Deleted in its entirety].
2.2 [* Deleted in its entirety]
[* Deleted in its entirety].
126
2.3 [* Deleted in its entirety]
[* Deleted in its entirety].
2.4 [* Deleted in its entirety]
[* Deleted in its entirety].
2.5 [* Deleted in its entirety]
2.5.1 [* Deleted in its entirety]
[* Deleted in its entirety].
2.5.2 [* Deleted in its entirety]
[* Deleted in its entirety]
127
- [* Deleted in its entirety].
- [* Deleted in its entirety].
- [* Deleted in its entirety].
- [* Deleted in its entirety]
1) [* Deleted in its entirety]
i) [* Deleted in its entirety]
ii) [* Deleted in its entirety]
iii) [* Deleted in its entirety]
2) [* Deleted in its entirety]
[* Deleted in its entirety]
[* Deleted in its entirety]
[* Deleted in its entirety]
[* Deleted in its entirety]
3.0 [* Deleted in its entirety]
3.1 [* Deleted in its entirety]
[* Deleted in its entirety].
3.2 [* Deleted in its entirety]
[* Deleted in its entirety].
128
3.3 [*Deleted in its entirety]
[*Deleted in its entirety].
4.0 [*Deleted in its entirety]
4.1 [*Deleted in its entirety].
4.2 [*Deleted in its entirety].
4.3 [*Deleted in its entirety].
4.4 [*Deleted in its entirety].
4.5 [*Deleted in its entirety].
4.6 [*Deleted in its entirety].
4.7 [*Deleted in its entirety].
4.8 [*Deleted in its entirety].
129
5.0 [*Deleted in its entirety]
5.1 [*Deleted in its entirety].
5.2 [*Deleted in its entirety].
5.3 [*Deleted in its entirety].
6.0 Remedies
6.1 In the event of a [* ] contained in this Letter Agreement,
Bombardier shall endeavor and shall use its reasonable efforts
to develop corrective measures. Such measures shall be
developed within a period of [* ] from the delivery of the
first Aircraft under the Agreement (or such other longer
period as is required in view of the corrective measures
involved).
6.2 [*Deleted in its entirety]
[*Deleted in its entirety].
[*Deleted in its entirety]:
[*Deleted in its entirety]
Where:
130
[*Deleted in its entirety]
[*Deleted in its entirety]
[*Deleted in its entirety]
[*Deleted in its entirety]
7.0 [* ]
[*Deleted in its entirety].
8.0 Conditions
8.1 The conditions apply as listed in Article 4.0 of this Letter
Agreement.
8.2 Buyer shall operate and maintain the Aircraft and the engines
in accordance with Bombardier's and engine manufacturer's
procedures, recommendations and instructions contained in the
applicable manuals, data and documents provided for the
Aircraft.
8.3 The Buyer shall not make any modifications on the airframe or
the engines that may affect the [* ] Aircraft.
9.0 [* ]
9.1 [*Deleted in its entirety]
9.2. [*Deleted in its entirety]
9.3 [*Deleted in its entirety]
10.0 In the event of the termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement.
11.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
131
12.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail. Without limiting the
foregoing the parties agree that Article 19 of the Agreement is fully
applicable to this Letter Agreement.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
-----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Regional Aircraft Division
ACCEPTED AND AGREED TO:
this day of September, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ AIRLINES, INC.
By:
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
132
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-07
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
1.0 [*Deleted in its entirety].
2.0 In the event of the termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement.
3.0 Except as provided for in Article 20.0 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
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Page 2
4.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
------------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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134
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-08
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
1.0 In consideration of Buyer having entered into the above referenced
Agreement, [* ].
2.0 In the event of the termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement. In the event of termination of the Agreement, [* ] will
be responsible to reimburse [* ] for [* ]
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Page 2
3.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
4.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By:
-------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-09
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the same
meanings as in the Agreement.
1.0 In consideration of Buyer having entered into the above referenced
Agreement, Bombardier and Buyer agree. [* ].
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Page 2
2.0 [*Deleted in its entirety].
3.0 In addition, the parties agree to provide one another with notice as to
the imposition or suspected imposition of [* ] or the payment by either
party [* ]. Bombardier will have the right to defend or challenge any
actual or potential [* ], provide such actions are not prejudicial as
to Buyer's rights.
4.0 [*Deleted in its entirety].
5.0 In the event of the termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement.
6.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
7.0 This Letter Agreement constitutes an integral part of the Agreement and
is subject to the terms and conditions contained therein. To the extent
of any inconsistency or conflict between this Letter Agreement and the
Agreement, this Letter Agreement shall prevail.
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Page 3
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: ________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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139
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-10
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms used herein which are defined in the Agreement and not defined herein
shall have the same meanings as in the Agreement.
This Letter Agreement provides for the terms and conditions on which Bombardier
shall provide [* ] with respect to the Aircraft.
1. [*Deleted in its entirety].
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Page 2
(b) [* ]:
(i) [*Deleted in its entirety].
(ii) [*Deleted in its entirety].
2. [* ]
(a) [*Deleted in its entirety].
(b) [*Deleted in its entirety].
(c) [*Deleted in its entirety].
3. [* ]:
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Page 3
(a) [*Deleted in its entirety].
(b) [*Deleted in its entirety].
(c) [*Deleted in its entirety].
(d) [*Deleted in its entirety].
(e) [*Deleted in its entirety].
(f) [*Deleted in its entirety].
4. [*Deleted in its entirety].
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Page 4
5. [*Deleted in its entirety].
6. [*Deleted in its entirety].
8. Confidentiality. The Buyer and Bombardier shall keep this letter
Agreement (including all exhibits hereto) confidential and shall not
disclose, or cause to be disclosed, the same to any Person except as
permitted by Article 23 of the Agreement, provided however that the
terms of Exhibit E hereto shall be subject to the provisions of section
9 of said Exhibit E.
9. Legal Opinion. Unless waived by Buyer, contemporaneously with
Bombardier's execution and delivery of any document attached hereto as
Exhibit "A", "D" or "E" (collectively the [* ), Bombardier shall supply
a legal opinion opining on due authorization, execution and delivery of
the [* ] so executed and delivered and that such [* ] are legal, valid
and binding obligations of Bombardier, in accordance with their
respective terms. The legal opinion shall be in a form to be mutually
satisfactory and agreed upon by the parties within ten (10) days after
the execution and delivery of the Agreement and
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Page 5
may be provided in whole or in part by, or in reliance on an opinion
issued by a duly admitted lawyer employed by the legal department of
Bombardier.
10. In the event of termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement.
11. Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
This Letter Agreement constitutes an integral part of the Agreement and is
subject to the terms and conditions contained therein. To the extent of any
inconsistency or conflict between this Letter Agreement and the Agreement, this
Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this ____ day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: ________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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144
Exhibit A
---------
[Series 700]
[*DELETED IN ITS ENTIRETY]
145
Exhibit B
---------
[Series 700]
[*DELETED IN ITS ENTIRETY]
146
Exhibit C
---------
[Series 700]
[*DELETED IN ITS ENTIRETY]
147
Exhibit D
---------
[Series 700]
[*DELETED IN ITS ENTIRETY]
148
Exhibit E
---------
[Series 700]
[*DELETED IN ITS ENTIRETY]
149
September __, 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-11
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
1.0 [* Deleted in its entirety].
2.0 [* Deleted in its entirety]:
[* Deleted in its entirety]:
-------------------------------
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-------------------------------
150
PAGE 2
2.1) [* Deleted in its entirety].
a.) [Deleted in its entirety]
b.) [Deleted in its entirety]
2.2) [* Deleted in its entirety]:
[* Deleted in its entirety].
3.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
151
PAGE 3
4.0 [* Deleted in its entirety].
5.0 [* Deleted in its entirety].
6.0 [* Deleted in its entirety].
7.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
152
PAGE 4
6.0 In the event of the termination of the Agreement pursuant to the
provisions of this Letter Agreement the rights and remedies provided
for under this Letter Agreement shall constitute the sole obligation
and liability of Bombardier and the sole and exclusive remedy of
Buyer.
7.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
8.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this ______ day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: -------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
153
September __, 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-12
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
1.0 [* Deleted in its entirety].
2.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
154
Page 2
3.0 [* Deleted in its entirety].
3.1 [* Deleted in its entirety].
4.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
155
Page 3
5.0 [* Deleted in its entirety].
6.0 [* Deleted in its entirety].
7.0 [* Deleted in its entirety].
8.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
156
Page 4
9.0 In the event of the termination of the Agreement, this Letter
Agreement shall survive with respect to all delivered Aircraft under
the Agreement.
10.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
11.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this ___ day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
157
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇.▇.▇., ▇▇▇▇▇-▇▇▇▇
Gentlemen,
Re: Letter Agreement No. 0430-13
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
1.0 [* Deleted in its entirety].
2.0 [* Deleted in its entirety].
-------------------------------
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-------------------------------
158
Page 2
3.0 [* Deleted in its entirety].
4.0 [* Deleted in its entirety].
5.0 [* Deleted in its entirety].
6.0 For purposes of this Letter Agreement, [* ] shall apply to the
amounts referred to under [* ].
-------------------------------
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-------------------------------
159
Page 3
7.0 In the event of termination of the Agreement, this Letter Agreement
shall survive such termination until the Advance has been disposed of
or applied as contemplated herein.
8.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
9.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
160
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-14
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
1.0 [*Deleted in its entirety].
-------------------------------
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-------------------------------
161
Page 2
2.0 [*Deleted in its entirety].
3.0 In the event of termination of the Agreement, this Letter Agreement
shall survive termination with respect to all delivered Aircraft under
the Agreement.
4.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
5.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours very truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this ___th day of September, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
162
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-15
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
In consideration of Buyer having entered into the above referenced Agreement,
Bombardier agrees to provide Buyer with the following benefits under the
general conditions outlined below:
1.0 [*Deleted in its entirety].
-------------------------------
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-------------------------------
163
Page 2
2.0 [*Deleted in its entirety].
3.0 [*Deleted in its entirety].
4.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
5.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
-------------------------------
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-------------------------------
164
Page 3
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
165
September , 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A
Gentlemen,
Re: Letter Agreement No. 0430-16
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. ("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer")
for the sale of twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement, including all Annexes attached to the
Agreement.
1.0 As used in this Letter Agreement "Vendor" shall mean each supplier of
Vendor Parts. [* ].
2.0 In the event of the termination of the Agreement, this Letter
Agreement shall survive termination with respect to all delivered
Aircraft under the Agreement.
3.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
4.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
Notwithstanding the foregoing the parties agree that this Letter
Agreement is subject to Article 19.12 of the Agreement.
-------------------------------
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-------------------------------
166
Page 2
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
-----------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
-------------------------------
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-------------------------------
167
September __, 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇.▇.▇., ▇▇▇▇▇-▇▇▇▇
Gentlemen,
Re: Letter Agreement No. 0430-17
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc. ("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer")
for the sale of twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer, will become part of the
Agreement and will evidence our further agreement with respect to the matters
set forth below.
All terms herein not defined herein shall have the same meanings as in the
Agreement.
1.0 [*Deleted in its entirety].
2.0 [*Deleted in its entirety].
-------------------------------
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-------------------------------
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Page 2
3.0 Bombardier will offer recurrent simulator training to Buyer on the
Canadair Regional Jet Series 700 Simulator in Montreal, Quebec on a
dry and wet lease basis at the hourly rates listed below upon
execution of the Agreement.
Dry Lease Wet Lease
--------- ---------
2000 $[* ] $[* ]
2001 $[* ] $[* ]
2002 $[* ] $[* ]
2003 $[* ] $[* ]
2004 $[* ] $[* ]
4.0 In the event of termination of the Agreement, this Letter Agreement
shall survive such termination.
5.0 Except as provided for in Article 20.1 of the Agreement, the
provisions of this Letter Agreement are personal to Buyer and shall
not be assigned or otherwise disposed of by Buyer without the prior
written consent of Bombardier.
6.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail.
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
--------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Regional Aircraft Division
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ACCEPTED AND AGREED TO:
this __th day of September, 1998
ATLANTIC SOUTHEAST AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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170
September __, 1998
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
Atlantic Southeast Airlines, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇.▇.▇.
Gentlemen,
Re: Letter Agreement No. 0430-18
Reference is made to Purchase Agreement No. P.A.-0430 (the "Agreement") between
Bombardier Inc., represented by Bombardier Aerospace Regional Aircraft
("Bombardier") and Atlantic Southeast Airlines, Inc. ("Buyer") for the sale of
twelve (12) Canadair Regional Jet Series 700 aircraft.
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have the
same meanings as in the Agreement.
1.0 [*Deleted in its entirety]:
a) [*Deleted in its entirety].
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Page 2
b) [*Deleted in its entirety].
c) [*Deleted in its entirety].
2.0 [*Deleted in its entirety].
3.0 Upon termination of the Agreement, this Letter Agreement shall survive
termination with respect to all delivered Aircraft under the
Agreement.
4.0 Except as provided for in Article 20 of the Agreement, the provisions
of this Letter Agreement are personal to Buyer and shall not be
assigned or otherwise disposed of by Buyer without the prior written
consent of Bombardier.
5.0 This Letter Agreement constitutes an integral part of the Agreement
and is subject to the terms and conditions contained therein. To the
extent of any inconsistency or conflict between this Letter Agreement
and the Agreement, this Letter Agreement shall prevail. Without
limiting the foregoing, the parties agree that Article 19 of the
Agreement is fully applicable to this Letter Agreement.
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Page 3
If the foregoing correctly sets forth your understanding of our agreement with
respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly,
BOMBARDIER INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇
Director of Contracts
Bombardier Aerospace Regional Aircraft
ACCEPTED AND AGREED TO:
this ___th day of September, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ AIRLINES, INC.
By: --------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
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