CONFIDENTIAL AMENDMENT No. 16 TO PURCHASE AGREEMENT DCT-014/2004
CONFIDENTIAL
TREATMENT
|
REQUESTED
PURSUANT TO RULE 24b-2
|
Certain portions of this exhibit have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934. The omitted materials have been filed separately with the Securities and Exchange Commission. |
CONFIDENTIAL
AMENDMENT
No. 16 TO PURCHASE AGREEMENT DCT-014/2004
This
Amendment No. 16 to Purchase Agreement DCT-014/2004, dated as of July 21, 2006
(“Amendment No. 16”) relates to the Purchase Agreement DCT-014/2004 (the
“Purchase Agreement”) between Embraer - Empresa Brasileira de Aeronáutica S.A.
(“Embraer”) and Republic Airline Inc. (“Buyer”) dated March 19, 2004 as amended
from time to time (collectively referred to herein as “Agreement”). This
Amendment No. 16 is between Embraer and Buyer, collectively referred to herein
as the “Parties”.
This
Amendment No. 16 sets forth additional agreements between Embraer and Buyer
relative to Buyer’s exercise of an assigned option to purchase thirty (30)
Embraer 175 model aircraft.
Except
as
otherwise provided for herein all terms of the Purchase Agreement shall remain
in full force and effect. All capitalized terms used in this Amendment No.
16,
which are not defined herein shall have the meaning given in the Purchase
Agreement. In the event of any conflict between this Amendment No. 16 and the
Purchase Agreement the terms, conditions and provisions of this Amendment No.
16
shall control.
In
connection with an amendment to the jet service agreement between US Airways,
Inc., and Buyer, US Airways Group desires to assign to Buyer, and Buyer desires
to accept the assignment of, an option to purchase thirty (30) EMBRAER 175
model
aircraft (the “US Airways 175 Option”) held by US Airways Group pursuant to
Amended and Restated Purchase Agreement DCT-021/03 between US Airways Group
and
Embraer (the “US Airways Purchase Agreement”);
Embraer
is willing to consent to the assignment of such option pursuant to the Option
Aircraft Conversion, Purchase Right Assignment and Manufacturer’s Consent dated
as of July 21, 2006, among US Airways Group, Buyer and Embraer (the “US Airways
175 Assignment”) if, immediately upon execution of such assignment, Buyer
exercises such option and agrees to purchase such aircraft as additional firm
order EMBRAER 175 Aircraft pursuant to the Agreement; and
In
connection with the Parties’ agreement above mentioned, the Parties have now
agreed to amend the Purchase Agreement as provided for below:
1. |
1.1 |
Article
1.4 of the Purchase Aircraft shall be deleted and replaced by the
following:
|
“1.4
|
Aircraft: shall mean an EMBRAER 170 Aircraft or EMBRAER 175 Aircraft, as defined below, and where the context requires all of such Aircraft. Aircraft shall include Firm Aircraft, Conditional and Option Aircraft unless expressly provided to the contrary. *** |
1.4.1
|
EMBRAER 170 Aircraft: shall mean the EMBRAER 170 LR aircraft (certification designation XXX 000-000 XX) (xxx "EMBRAER 170 Aircraft") or, where there is more than one of such Aircraft, each of the EMBRAER 170 Aircraft, manufactured by Embraer for sale to Buyer pursuant to this Agreement according to the Preliminary Technical Description PTD 170 - Rev.4 dated as of May 2003 (which, although not attached hereto, is incorporated herein by reference) and the Aircraft configuration described in Attachment "A", and as may be amended from time to time as specified in Article 11. |
1.4.2
|
EMBRAER
175 Aircraft: shall mean the EMBRAER 175 LR (certification designation
XXX
000-000 XX) (xxx "EMBRAER 175 Aircraft") or, where there is more
than one
of such Aircraft, each of the EMBRAER 175 Aircraft, manufactured
by
Embraer for sale to Buyer pursuant to this Agreement according to
the
Preliminary Technical Description PTD 175 - Rev.4 dated as of May
2003
(which, although not attached hereto, is incorporated herein by reference)
and the Aircraft configuration described in Attachment "A-1" for
the
Aircraft
listed in the table containing the delivery schedule in Article 5.1
of the
Purchase Agreement with the designations “E175” and “*** ” (the “ ***175
Aircraft”)
and Attachment “A-2” for the Aircraft listed
in the table containing the delivery schedule in Article 5.1 of the
Purchase Agreement with the designations “E175” and “*** ” (the “ ***175
Aircraft”),
and as may be amended from time to time as specified in Article 11.”
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2. |
2.1
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Buyer
hereby exercises the ***175 Option and agrees to purchase the thirty
(30)
aircraft that are the subject of such option as additional firm order
EMBRAER 175 Aircraft #49 to #78 on the terms and subject to the conditions
of the Agreement.
|
2.2
|
Article
2 of the Purchase Agreement is hereby deleted and replaced as
follows:
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“Subject to the terms and conditions of this Agreement: |
2.1 Embraer shall sell and deliver and Buyer shall purchase and take delivery of forty-eight (48) EMBRAER 170 Aircraft and thirty (30) EMBRAER 175 Aircraft ***; |
2.3 Embraer shall provide to Buyer the Services and the Technical Publications; and |
2.4 Buyer shall have the option to purchase up to seventy-five (75) Option EMBRAER 170 Aircraft, in accordance with Article 23.” |
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***Confidential
-1-
3. |
3.1
|
Article 3.1 of the Purchase Agreement is hereby deleted and replaced by the following: |
“3.1 Buyer agrees to pay Embraer, subject to the terms and conditions of this Agreement, in United States dollars, the following amount per unit Basic Prices: |
Aircraft
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Aircraft
Basic Price
|
Economic
Condition
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***
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***
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***
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4. |
4.1
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The third sentence of the first paragraph of Article 4.1 is hereby deleted and replaced as follows: |
“Buyer has already paid to Embraer prior to the execution of Amendment No. 16 to this Agreement a *** initial deposit (the “Initial Deposit”) per Firm Aircraft on order prior thereto and ***, and ***.” |
4.2
|
The penultimate sentence of the last paragraph of Article 4.1 is hereby deleted and replaced as follows: |
“Any progress payment for *** that would otherwise be due *** shall be due ***.” |
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***Confidential
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CONFIDENTIAL
Firm
A/C
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Delivery
Month
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***
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***
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Firm
A/C
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Delivery
Month
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***
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***
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1
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Sep
2004
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***
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***
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42
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***
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***
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2
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43
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3
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44
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4
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45
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5
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46
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6
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***
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47
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***
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7
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***
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***
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***
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48
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***
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***
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***
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8
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***
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***
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49
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***
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9
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***
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***
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50
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***
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***
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10
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51
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11
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52
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***
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12
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***
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***
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53
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***
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***
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13
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***
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***
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***
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54
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***
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***
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***
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14
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***
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***
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***
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55
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***
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***
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***
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15
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***
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***
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***
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56
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***
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***
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***
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16
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***
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***
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***
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57
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***
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***
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17
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***
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58
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***
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***
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18
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***
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***
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59
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***
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***
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***
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19
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***
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***
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***
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60
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***
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***
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***
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20
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***
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***
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***
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61
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***
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***
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21
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***
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***
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***
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62
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***
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***
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***
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22
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***
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***
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***
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63
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***
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***
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***
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23
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***
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***
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***
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64
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***
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***
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***
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24
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***
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***
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***
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65
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***
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***
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25
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***
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***
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***
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66
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***
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***
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26
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***
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***
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67
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***
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***
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***
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27
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***
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***
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***
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68
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***
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***
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***
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28
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***
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***
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***
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69
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***
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***
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***
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29
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***
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***
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***
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70
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***
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***
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***
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30
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***
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***
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***
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71
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***
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***
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***
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31
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***
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***
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***
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72
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***
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***
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***
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32
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***
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***
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***
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73
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***
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***
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33
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***
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***
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***
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74
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***
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***
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***
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34
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***
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***
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***
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75
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***
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***
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***
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35
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***
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***
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***
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76
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***
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***
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***
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36
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***
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***
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***
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77
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***
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***
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***
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37
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***
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***
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***
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78
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Jul
2008
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***
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***
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38
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39
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40
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41
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___________
***
Confidential
-3-
CONFIDENTIAL
*** | |
6. | ***: *** is hereby amended by deleting *** and replacing it with ***. |
7.
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7.1
|
The
first paragraph of Article 11.1 is hereby deleted and replaced with
the
following:
|
“At delivery each EMBRAER 170 Aircraft will comply with the standards defined in Attachment “A”, each EMBRAER 175 Aircraft will comply with the standards defined in Attachment “A-1” or Attachment “A-2”, as applicable, and each Aircraft shall incorporate all modifications which are classified as Airworthiness Directives (ADs) mandatory by CTA or FAA and shall also at the Actual Delivery Date incorporate any change agreed upon by Buyer and Embraer in accordance with this Article 11.” |
7.2
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Article
11.6 is hereby amended by inserting in the first sentence after
“Attachment ‘A’” the following “, Attachment ‘A-1’ or Attachment ‘A-2’, as
applicable,”
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7.3
|
Article
11.7 is hereby amended by deleting the first sentence thereof and
replacing it with the following:
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“Except ***, should an EMBRAER 170 Aircraft not comply with the terms and conditions of Attachment “A” or an EMBRAER 175 Aircraft not comply with the terms and conditions of Attachment “A-1” or Attachment “A-2”, as applicable, Buyer shall be entitled to either ***. |
8.
|
Conditional Aircraft: Article 22 of Purchase Agreement is no longer applicable. |
9.1
|
The opening paragraph of Article 23 and delivery schedule table of the Purchase Agreement are hereby deleted and replaced by the following: |
“Buyer
shall have the option to purchase up to seventy-five (75) additional Option
Aircraft, to be delivered on the last day of the applicable month set forth
below or such earlier date in such month specified pursuant to Article 7.1:
Option
A/C
|
Delivery
Month
|
Option
A/C
|
Delivery
Month
|
Option
A/C
|
Delivery
Month
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1
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Jul
2008
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26
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***
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51
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***
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2
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***
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27
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***
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52
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***
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3
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***
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28
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***
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53
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***
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4
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***
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29
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***
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54
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***
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5
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***
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30
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***
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55
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***
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6
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***
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31
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***
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56
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***
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7
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***
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32
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***
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57
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***
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8
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***
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33
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***
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58
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***
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9
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***
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34
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***
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59
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***
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10
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***
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35
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***
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60
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***
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11
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***
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36
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***
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61
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***
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12
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***
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37
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***
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62
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***
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13
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***
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38
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***
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63
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***
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14
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***
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39
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***
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64
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***
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15
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***
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40
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***
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65
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***
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16
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***
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41
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***
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66
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***
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17
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***
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42
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***
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67
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***
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18
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***
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43
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***
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68
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***
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19
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***
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44
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***
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69
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***
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20
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***
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45
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***
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70
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***
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21
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***
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46
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***
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71
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***
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22
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***
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47
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***
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72
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***
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23
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***
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48
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***
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73
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***
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24
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***
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49
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***
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74
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***
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25
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***
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50
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***
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75
|
Sep
2012
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9.2
|
Article 23.1 is hereby deleted and replaced by the following: |
“23.1 To secure the Option Aircraft, Buyer has paid Embraer a *** deposit (the “Option Aircraft Deposit”) per Option Aircraft available under this Agreement prior to the execution of Amendment No. 16 to this Agreement, and Buyer shall pay to Embraer a refundable Option Aircraft Deposit for the additional thirty-five (35) Option Aircraft added by such amendment within two (2) Business Days after the date of execution by Buyer and Embraer of such amendment. “ |
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***Confidential
-4-
CONFIDENTIAL
10.
Representations
and Warranties: Article
31.1.1 is hereby amended to insert after “EMBRAER-170” the following: “and
EMBRAER-175”.
11.
Attachment “A-1” and “A-2”: New
Attachments “A-1”, for the Airways 175 Aircraft, and “A-2”, for the Delta 175
Aircraft, are hereby added to the Purchase Agreement.
12.
Attachment “B”: Exhibit
1
to Attachment “B” are hereby amended by deleting in the heading “-170”.
Embraer
shall provide to Buyer ***, *** necessary to reflect all relevant information
regarding the inclusion of the EMBRAER 175 Aircraft. If requested by Buyer,
***,
which will ***, and this *** of the ***.
13.
Attachment
“C”:
Attachment “C” to the Purchase Agreement are hereby amended to delete in clause
1 “EMBRAER 170” before “Aircraft”.
14.
Attachment “E”: Attachment
“E” to the Purchase Agreement is hereby deleted and replaced with Attachment E
to this Amendment No. 16.
15.
Attachment “F”: Attachment
“F” to the Purchase Agreement is hereby deleted and replaced with Attachment “F”
to this Amendment No. 16.
16.
Attachments “H-1”: A
new
Attachment “H-1” is hereby added to the Purchase Agreement with the EMBRAER 175
Performance Guarantee.
17.1
|
Buyer’s
sole rights against Embraer and obligations to Embraer with respect
to the
aircraft positions that are the subject the US Airways 175 Assignment
shall be its rights and obligations with respect to the thirty (30)
firm
order EMBRAER 175 Aircraft added to the Purchase Agreement pursuant
to
this Amendment No. 16.
|
17.2
|
Buyer
agrees that it has no rights to *** in connection with the US Airways
175
Assignment.
|
18.
Miscellaneous: All
other
provisions of the Agreement which have not been specifically amended or modified
by this Amendment No. 16 shall remain valid in full force and effect without
any
change.
[Remainder
of page intentionally left in blank]
___________
***Confidential
***Confidential
-5-
EMBRAER - Empresa Brasileira de Aeronáutica S.A. | Republic Airline Inc. | ||
/s/ Xxxxxxxxx Xxxxxx Curado | /s/ Xxxxx Xxxxxxx | ||
|
|
||
Name:
Xxxxxxxxx Xxxxxx Curado Title: Executive Vice President More Title: Airline Market |
Name:
Xxxxx Xxxxxxx Title: President |
/s/ Xxxx Xxxx X. Xxxxxx | |||
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|||
Name:
Xxxx Xxxx x.
Xxxxxx Title: Director of Contracts More Title: Airline Market |
|||
Date: July 21, 2006 | Date: July 21, 0000 | ||
Xxxxx: Xxx Xxxx Xxx Xxxxxx, XX, Xxxxxx | Place: Indianapolis |
Witness: Xxxxxx Xxxxxxx Xxxxx | Witness: Xxxx-Xxxx Xxxxxx | ||
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Name:
Xxxxxx
Xxxxxxx Xxxxx |
Name:
Xxxx-Xxxx
Xxxxxx |
CONFIDENTIAL
Acknowledged
and agreed by Republic Airways Holdings Inc. with respect to all terms of this
Amendment Xx. 00, Xxxxxxxxx Xx. 0 to the Letter Agreement and all previous
amendments, in its capacity as “Guarantor” pursuant to the Guaranty by it to
Embraer dated March 19, 2004.
REPUBLIC AIRWAYS HOLDINGS INC. | ||
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By: | /s/ Xxxxx Xxxxxxx | |
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Name:
Xxxxx Xxxxxxx
Title: President
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By: | /s/ Lars Xxxx Xxxxxx | |
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Name: Xxxx-Xxxx Xxxxxx | ||
Title: Vice President | ||
Date: July 21, 2006 | ||
Place: Indianapolis |
-6-
Airways
Configuration
1.
EMBRAER 175 CONFIGURATION
EMBRAER
175 Standard Aircraft
The
EMBRAER 175 Aircraft shall be manufactured according to (i) the standard
configuration specified in the Preliminary Technical Description PTD-175 Rev.
4
dated May 2003, which although not attached hereto, is incorporated herein
by
reference, and (ii) the characteristics described in the items
below.
The
EMBRAER 175 Aircraft will also be fitted with the following options selected
by
Buyer:
a) |
EMBRAER
175 LR
|
b) |
GE
CF34-8E5 Engines
|
2.2
Options By Ata Chapter
***
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***Confidential
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2.3
|
EMBRAER 175 Basic Interior Configuration (86 seats - single class) |
*
3.
FINISHING
The
Aircraft will be delivered to Buyers as follows:
The
fuselage of the Aircraft shall be painted according to Buyer’s color and paint
scheme which shall be supplied to Embraer by Buyer on or before six (6) months
prior to the relevant Aircraft Contractual Delivery Date.
The
wings
and the horizontal stabilizer of all Aircraft shall be supplied in the standard
colors, i.e., xxxx BAC707.
Buyer
shall inform Embraer on or before *** months prior to the relevant Aircraft
Contractual Delivery Date of its choice of materials and colors of all and
any
item of interior finishing such as seat covers, carpet, floor lining on galley
areas, side walls and overhead lining, galley lining and curtain. The
above-mentioned schedule for definition of interior finishing shall only be
applicable if Buyer selects its materials from the choices offered by and
available at Embraer. In case Buyer opts to use different materials and or
patterns, such schedule shall be mutually agreed between the Parties at the
time
of signature of the Purchase Agreement.
Buyer
may
choose to have carpets, tapestries, seat covers and curtain fabrics supplied
to
Embraer for installation in the Aircraft as BFE. Materials shall conform to
the
required standards and comply with all applicable regulations and airworthiness
requirements. Delays in the delivery of BFE equipment or quality restrictions
that prevent the installation thereof in the time frame required by the Aircraft
manufacturing process shall entitle Embraer to either delay the delivery of
the
Aircraft or present the Aircraft to Buyer without such BFE, in which case Buyer
*** of the Aircraft. All BFE equipment shall be delivered to Embraer in DDP
-
Embraer facilities in São Xxxx dos Xxxxxx, XX, Brazil (Incoterms 2000)
conditions.
The
Aircraft galleys have provisions for the following BIE items that, unless timely
agreed by the Parties, are not supplied or installed by Embraer: Trolleys,
ovens, coffee makers, hot jugs and standard units.
The
Aircraft shall be delivered to Buyer with the registration marks painted on
them. The registration marks and the transponder code shall be supplied to
Embraer by Buyer no later than ninety (90) Days before each relevant Aircraft
Contractual Delivery Date.
IT
IS HEREBY AGREED AND UNDERSTOOD BY THE PARTIES THAT IF THERE IS ANY CONFLICT
BETWEEN THE TERMS OF THIS ATTACHMENT “A-1” AND THE TERMS OF THE TECHNICAL
DESCRIPTION ABOVE REFERRED, THE TERMS OF THIS ATTACHMENT “A-1” SHALL
PREVAIL.
____________
***Confidential
-8-
ATTACHMENT
"A-2" - EMBRAER 175 AIRCRAFT
CINFIGURATION
Delta
Configuration
1.
EMRAER 175 CONFIGURATION
EMBRAER
175 Standard Aircraft
The
EMBRAER 175 Aircraft shall be manufactured according to (i) the standard
configuration specified in the Preliminary Technical Description PTD-175 Rev.
4
dated May 2003, which although not attached hereto, is incorporated herein
by
reference, and (ii) the characteristics described in the items
below.
The
EMBRAER 175 Aircraft will also be fitted with the following options selected
by
Buyer:
a) |
EMBRAER
175 LR
|
b) |
GE
CF34-8E5 Engines
|
2.2
Options By Ata Chapter
***
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***
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***
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***
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___________
***Confidential
-9-
2.3
EMBRAER 175 Basic Interior Configuration (78 seats)
*
3.
FINISHING
The
Aircraft will be delivered to Buyers as follows:
The
fuselage of the Aircraft shall be painted according to Buyer’s color and paint
scheme which shall be supplied to Embraer by Buyer on or before six (6) months
prior to the relevant Aircraft Contractual Delivery Date.
The
wings
and the horizontal stabilizer of all Aircraft shall be supplied in the standard
colors, i.e., xxxx BAC707.
Buyer
shall inform Embraer on or before *** months prior to the relevant Aircraft
Contractual Delivery Date of its choice of materials and colors of all and
any
item of interior finishing such as seat covers, carpet, floor lining on galley
areas, side walls and overhead lining, galley lining and curtain. The
above-mentioned schedule for definition of interior finishing shall only be
applicable if Buyer selects its materials from the choices offered by and
available at Embraer. In case Buyer opts to use different materials and or
patterns, such schedule shall be mutually agreed between the Parties at the
time
of signature of the Purchase Agreement.
Buyer
may
choose to have carpets, tapestries, seat covers and curtain fabrics supplied
to
Embraer for installation in the Aircraft as BFE. Materials shall conform to
the
required standards and comply with all applicable regulations and airworthiness
requirements. Delays in the delivery of BFE equipment or quality restrictions
that prevent the installation thereof in the time frame required by the Aircraft
manufacturing process shall entitle Embraer to either delay the delivery of
the
Aircraft or present the Aircraft to Buyer without such BFE, in which case Buyer
*** of the Aircraft. All BFE equipment shall be delivered to Embraer in DDP
-
Embraer facilities in São Xxxx dos Xxxxxx, XX, Brazil (Incoterms 2000)
conditions.
The
Aircraft galleys have provisions for the following BIE items that, unless timely
agreed by the Parties, are not supplied or installed by Embraer: Trolleys,
ovens, coffee makers, hot jugs and standard units.
The
Aircraft shall be delivered to Buyer with the registration marks painted on
them. The registration marks and the transponder code shall be supplied to
Embraer by Buyer no later than ninety (90) Days before each relevant Aircraft
Contractual Delivery Date.
IT
IS HEREBY AGREED AND UNDERSTOOD BY THE PARTIES THAT IF THERE IS ANY CONFLICT
BETWEEN THE TERMS OF THIS ATTACHMENT “A-2” AND THE TERMS OF THE TECHNICAL
DESCRIPTION ABOVE REFERRED, THE TERMS OF THIS ATTACHMENT “A-2” SHALL
PREVAIL.
____________
***Confidential
-10-
ATTACHMENT
"E" - DIRECT MAINTENANCE COST
GUARANTEE
I. |
Embraer,
subject to the terms, conditions and limitations contained in this
Attachment, shall guarantee the incurred direct maintenance cost
(the
“Maintenance Cost Guarantee”) for the fleet of Aircraft subject of the
Purchase Agreement as follows:
|
a. |
The
Maintenance Guarantee for the Aircraft shall be for the period that
begins
at *** (“Guarantee Term”). ***
|
b. |
For
the *** period commencing with the first Aircraft Actual Delivery
Date,
the Achieved cumulative Maintenance Cost - AMC for replacement, repair,
overhauls and inspections of Buyer's Aircraft, shall not exceed a
Maintenance Cost Guarantee (“”)
rate of:
|
***
|
***
|
***
|
***
|
***
|
***
|
c. |
For
the *** period commencing with the first Aircraft Actual Delivery
Date,
the Achieved cumulative Maintenance Cost - AMC for replacement, repair,
overhauls and inspections of Buyer's Aircraft, shall not exceed a
Maintenance Cost Guarantee ("")
rate of:
|
***
|
***
|
***
|
***
|
***
|
***
|
d. |
The
*** shall be *** in accordance with
***.
|
e. |
Measurement
will be computed annually on the anniversary date of ***. The results
will
be reconciled year by year until
***.
|
f. |
In
the event at the end of each annual measurement period, the AMC is
higher
than the MCG, Embraer shall provide *** to Buyer as provided for
below:
|
***
____________
***Confidential
-11-
g. |
Buyer
shall use *** efforts to calculate and submit to Embraer the AMC
quarterly, in electronic format, *** after the end of each quarter
during
the Guarantee Term. In the event that Buyer fails to submit such
data to
Embraer as described in the preceding sentence, Embraer shall send
a
written notice to Buyer requesting such data, and the guarantee contained
in this Attachment shall terminate in the event Buyer fails to submit
the
AMC to Embraer within *** of such written notice.
|
The
Parties shall use *** efforts to reach an agreement over the data annually
within *** after the submission of AMC in regard to any fourth quarter. In
the
event that the AMC contains *** that is out of the reasonable control of ***,
the Parties shall also discuss the reasons for such *** and whether it should
be
included in the calculation of the AMC. Any *** will be *** after the agreement
regarding the annual period. Such *** may be ***.
h. |
This
Maintenance Guarantee is based upon the following assumptions, and
any
change to the assumptions shall result in an appropriate recalculation
of
the MCG rate specified in items “b” and “c” above, at Embraer
criteria.
|
Fleet
Size: A
minimum
fleet size of ***.
Assumptions
01
§ |
Economic
condition:
***.
|
§ |
Utilization:
The guarantee covers a minimum of *** flight hours per cycle, ***
APU hour
per flight hour plus or minus *** APU hour per flight hour and ***
APU
cycle per flight cycle plus or minus *** APU cycle per flight cycle.
Buyer's
fleet-wide average
annual Aircraft utilization shall be *** flight hours, plus or minus
***.
|
§ |
Labor
rate:
*** per man-hour ***.
|
§ |
Maintenance
Review Board Report: MRB
170.
|
Assumptions
02
§ |
Economic
condition:
***.
|
§ |
Utilization:
The guarantee covers a minimum of *** flight hours per cycle, ***
APU hour
per flight hour plus or minus *** APU hour per flight hour and ***
APU
cycle per flight cycle plus or minus *** APU cycle per flight cycle.
Buyer's
fleet-wide average
annual Aircraft utilization shall be *** flight hours, plus or minus
***.
|
§ |
Labor
rate:
*** per man-hour ***.
|
§ |
Maintenance
Review Board Report: MRB
170.
|
i. |
The
following are the elements covered under this Maintenance
Guarantee:
|
1. | Material cost for non-repairable parts purchased from or through Embraer and / or Embraer approved vendors. |
2. |
Overhaul/repair
costs incurred at Embraer approved repair
facilities.
|
3. |
Expendable
which can be accounted for on an unit basis, i.e. filters, gaskets,
excluding wire, rivets, nuts, bolts, washers, pins, brackets, tie
wraps.
|
4. |
Parts
and materials consumed through scheduled maintenance according to
the
Maintenance Review Board Report
(MRB).
|
j. |
The
following elements are not covered under this guarantee:
|
1. |
Costs
associated with taxes, levies, imposts, customs
fees.
|
2. |
Shipping,
receiving, ferry, packing, storage, warehousing and insurance
expenses.
|
3. |
General
administrative and overhead
expenses.
|
4. |
Restoration
expenses incurred due to damage to or failure of Aircraft, components
or
parts caused by accident, incident, FOD or Acts of God, negligence,
abuse,
misuse and/or maintenance errors.
|
___________
***Confidential
-12-
5. |
When
the Aircraft or any of its parts has/have been altered or modified
by
Buyer, without prior approval from Embraer or from the manufacturer
of the
parts through a service bulletin, provided such approvals have not
been
unreasonably withheld.
|
6. |
Consumables
including but not limited to fluids, water, oils, sealants, washing
compounds, cleansers, solvents, and
lubricants.
|
7. |
Labor
costs (excluding the *** related to *** and *** service bulletins
implementation, provided that *** have been *** in writing *** in
order
***.
|
8. |
Normal
line operations activities (i.e. Aircraft servicing) including but
not
limited to walkaround (i.e. visual inspection), fueling, parking,
washing,
lavatory servicing and gallery
servicing.
|
9. |
Service
bulletins and or airworthiness
directives.
|
10. |
Parts
or components returned from vendors with “no-fault” found, i.e.,
re-certification charges without any repair and associated labor.
Any part
removed and replaced from an Aircraft which does not solve the Aircraft
problem (poor troubleshooting) and associated
labor.
|
11. |
Leasing
or loan fees related to the aircraft or any of its parts which are
being
used in place of an unserviceable
unit.
|
12. |
Any
part supplied on a “no-charge basis” or for which a warranty credit or
replacement part has been supplied.
|
13. |
Aircraft
downtime costs.
|
14. |
Any
parts that are changed during scheduled or unscheduled maintenance,
due to
failure, which are still under the warranty period and, are not submitted
to Embraer or the suppliers for warranty
credit.
|
15. |
Cabin
equipment and furnishing materials, such as but not limited to carpets,
seat covers, galley equipment and passenger
commodities.
|
16. |
Spare
parts prices that exceed the prices obtainable from Embraer, provided,
in
the event that *** a reasonable time frame, *** may **** and ***
will
reasonably agree on ***.
|
17. |
In
cases of deterioration, wear, breakage, damage or any other defect
resulting from the use of inadequate packing methods when returning
items
to Embraer or its representatives.
|
18. |
Maintenance
problems caused by Buyer’s negligence or misuse of parts or Buyer’s
failure to take all maintenance actions on the Aircraft as recommended
in
all applicable maintenance manuals.
|
19. |
Maintenance
problems involving Aircraft or parts that has / have been involved
in an
accident, or when parts either defective or not complying to
manufacturer’s design or specification have been
used.
|
20. |
Maintenance
problems involving parts that have had their identification marks,
designation, seal or serial number altered or
removed.
|
21. |
Extraordinary
costs incurred as a result of any labor disruption or dispute involving
a
significant work action that affects in whole or part the Aircraft’s
normal operation or maintenance.
|
22. |
Engines,
related parts and related LRU
costs.
|
_____________
***Confidential
-13-
23. |
Nacelle
and Thrust Reverser.
|
24. |
BFE
(Buyer Furnished Equipment) and / or BIE (Buyer Installed Equipment)
costs.
|
25. |
Maintenance
reserves.
|
26. |
GSE
(Ground Support Equipment) costs.
|
27. |
For
the purpose of calculating the Achieved Maintenance Cost Guarantee,
the
materials and labor costs related to the New US Airways Aircraft,
Owned
Aircraft and GECC Aircraft shall be accounted for at the time these
aircraft start their revenue service by Buyer under this Purchase
Agreement. All previous materials cost and labor costs shall be
disregarded. The total number of previous flight hours and cycles
of such
additional aircraft (New US Airways Aircraft, Owned Aircraft and
GECC
Aircraft) New US Airways Aircraft, Owned Aircraft and GECC Aircraft
shall
be considered.
|
II. |
The
foregoing maintenance guarantee is provided subject to Buyer’s adherence
to the following general
conditions:
|
a. |
Airplane
Operation: Aircraft shall be operated in airline service in accordance
with the applicable Air Authority regulations and as recommended
by
Embraer through the official and updated Operations and Airplane
Flight
Manual.
|
b. |
Inspection
Program: The Aircraft shall be maintained in accordance with the
current
Maintenance Review Board Report - (MRB), and the checks shall in
no event
occur at a *** Buyer’s Maintenance Program must have provisions for
escalating the checks interval as soon as the applicable Air Authority
allows. Buyer’s program should also include the use of task cards to
assist the maintenance personnel in performing inspection
task.
|
c. |
Aircraft
Manuals: Buyer shall keep a complete set of Embraer recommended manuals
up-to-date and available to airline personnel for assisting them
with the
maintenance and operation of the Aircraft. A set of recommended manuals
or
a electronic link to the data should be available at all maintenance
bases
(line or heavy) and shall be maintained with the latest revisions
at all
times.
|
d. |
Warranty:
Buyer shall have at minimum, one person which will be dedicated to
the
Aircraft warranty program. This person(s) will be trained by Embraer
warranty department on the correct procedures for filing Buyer warranty
claims in accordance with mutually agreed format. This person(s)
shall
also be responsible for the filing of warranty claims directly to
suppliers for credit, repair or
replacement.
|
e. |
Parts
Repair: All shop repairs shall be performed in Embraer’s or Embraer’s
suppliers’ authorized repair shops.
|
f. |
Staff
levels: Buyer shall have available reasonable staff to properly maintain
the Aircraft during scheduled and unscheduled maintenance. This shall
include, but not be limited to, mechanics, electricians, avionics
specialists, inspectors, cleaners, ground personnel and flight crews
licensed or certified by the applicable Air Authority as required
by the
applicable Air Authority
regulations.
|
_____________
***Confidential
-14-
g. |
Training:
Buyer is required to put in place a training program approved by
the local
airworthiness authority, which, at a minimum, shall include the following
items:
|
1. |
initial
and recurrent training for pilots in the
Aircraft;
|
2. |
initial
and recurrent training for flight attendants in the Aircraft;
and
|
3. |
initial
and recurrent training for the maintenance staff (airframe, powerplant,
electric avionics specialists) in the
Aircraft.
|
A
reasonable number of maintenance specialist will require supplier’s
training.
Buyer
is
required to train to the above standards a reasonable number of new hired
employee who will work in or on the Aircraft.
h. |
Spare
Parts Limitation: Spare parts price shall not exceed the prices obtainable
from Embraer. In the event that Embraer cannot supply a part to Buyer
in a
reasonable time frame, Embraer may authorize the purchase of such
part by
Buyer from a third party at a price in excess of Embraer’s price, Embraer
and Buyer will mutually agree on the portion of such price to be
included
in this guarantee provided Buyer maintained the minimum stock level
recommended by Embraer.
|
i. |
Buyer
will be required to provide Embraer an every three month service
bulletin
status report, containing service bulletin number, Aircraft serial
number,
Aircraft total time and total
cycles.
|
j. |
Ground
Support Equipment: Embraer shall provide Buyer a list of tooling
and
ground support equipment required to maintain the Aircraft, this
list
shall be subject to Buyer’s reasonable approval. Buyer will be required to
maintain these levels of required tooling and ground support equipment
in
good working order at all times.
|
k. |
Reliability
Reporting: Buyer is to provide monthly to Embraer an Aircraft reliability
report. This report shall include Aircraft total time and cycles,
component removals, shop finding reports and tear down reports (for
each
failure completed) by authorized agencies and SDR’s (Service Difficult
Report) with date, Aircraft registration, problem description, maintenance
action, and part number and serial number of the components removed
and
installed. Buyer shall use the ATA 100 chapter breakdown format for
all
reports.
|
l. |
Accounting
System:
|
1. |
Buyer
shall have an accounting system, subject to Embraer’s reasonable approval,
which demonstrates the ability to discriminate between chargeable
and
non-chargeable costs and expenses. Buyer’s accounting system shall be
presented to Embraer, upon Embraer’s written request, *** before
***.
|
2. |
Upon
Embraer’s written request, Buyer shall also provide on a *** basis an
activity and expenditure report satisfactory to Embraer, in electronic
format and in accordance with Embraer’s Service News Letter for data
exchange.
|
3. |
Upon
Embraer’s written request, Embraer and Buyer may convene frequently
meetings to address issues concerning the AMC and to identify methods
to
decrease Buyer’s maintenance costs. At a minimum, Embraer and Buyer shall
have two meetings per year to confirm and compute all costs claimed
by
Buyer. Buyer shall permit Embraer access to all Buyer data which
can be
used to verify any reports produced pursuant to this Attachment.
|
m. |
Duplicated
Guarantee: If Buyer negotiates directly with any of Embraer’s
suppliers/vendors a particular maintenance cost guarantee or equivalent
program (including fleet hour agreements), or an alternative support
program with Embraer, the Parties shall negotiate in good faith and
agree
on the
portion of cost related to this equipment/system that shall be excluded
from the MCG rate, specified in Article I.b and I.c, and shall result
in
an appropriate recalculation of the
MCG.
|
III. |
Buyer
shall not unreasonably reject Embraer’s recommendations, changes or
solutions to elements of maintenance that would result in cost savings,
as
reasonably determined by the
Parties.
|
IV. |
EXCEPT
AS OTHERWISE PROVIDED IN THIS AGREEMENT THE GUARANTEES, OBLIGATIONS
AND
LIABILITIES OF EMBRAER, AND REMEDIES OF BUYER SET FORTH IN THIS AIRCRAFT
MAINTENANCE COST GUARANTEE ARE EXCLUSIVE AND IN SUBSTITUTION FOR,
AND
BUYER HEREBY WAIVES, RELEASES AND RENOUNCES, ALL OTHER RIGHTS, CLAIMS,
DAMAGES AND REMEDIES OF BUYER AGAINST EMBRAER OR ANY ASSIGNEE OF
EMBRAER,
EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO
ANY
GUARANTEED LEVEL OF AIRCRAFT MAINTENANCE
COSTS.
|
V. |
The
guarantee hereby expressed is established between Embraer and Buyer
and it
cannot be transferred or assigned to others, unless stated in this
Agreement or by previous written consent of
Embraer.
|
___________
***Confidential
-15-
ATTACHMENT
"F" - SCHEDULE RELIABILITY GUARANTEE
I. |
Definitions.
|
a. |
Available
for Dispatch: An Aircraft which is on the ground and cleared for
dispatch
by signature of Buyer's responsible maintenance personnel at least
***
before the scheduled departure time of the initial flight in any
given day
shall be deemed to be "available for
dispatch".
|
b. |
Maintenance
Interruption.
|
1. |
A
maintenance interruption occurs when the malfunction of an item,
or
necessary checking and/or corrective actions, cause a revenue flight
not
to take place or a flight delay exceeding
***.
|
2. |
For
the purposes of this guarantee, only the initial Maintenance Interruption
shall be accounted as interruption. Maintenance Interruption of any
or all
flights on subsequent days arising from the initial Maintenance
Interruption shall not constitute an additional Maintenance
Interruption.
|
3. |
Before
a flight may be considered as a Maintenance Interruption for the
purpose
of this Schedule Reliability Guarantee the Aircraft must be inspected
for
mechanical failure or malfunction.
|
4. |
A
repetitive problem, which caused an actual maintenance interruption
and
was not previously corrected, shall not be counted as a Maintenance
Interruption.
|
5. |
To
be accounted as a Maintenance Interruption, any malfunction reported,
either verbal or written, must result in maintenance corrective action.
“No-trouble-found” or “could not duplicate” or “reset” events shall not be
accounted as Maintenance
Interruption.
|
6. |
A
maintenance interruption that occurs due to failures of systems or
parts
from suppliers or vendors that have a separate maintenance interruption
guarantee agreement with Buyer, and which is not assigned to Embraer,
shall not be considered as a Maintenance
Interruption.
|
c. |
Achieved
Dispatch Reliability Percentage
(“ADRP”).
|
ADRP
is
the actual dispatch reliability percentage obtained by Buyer's fleet of Aircraft
in regular revenue service, which are the subject of this
Agreement.
ADRP
shall be computed monthly commencing with *** by Buyer, as follows:
***
___________
***Confidential
-16-
II. |
Embraer,
subject to the conditions and limitations expressed herein, will
guarantee
the Aircraft’s schedule reliability percentage as follows:
|
a. |
The
average ADRP for the first *** period after *** delivered under the
Purchase Agreement, shall be ***;
for the *** the ADPR shall be ***;
for the *** the ADPR shall be ***;
for the *** the ADPR shall be ***,
for the *** (the “Final Period”) the ADPR shall be ***.
|
b. |
In
the event that the ADRP in any of the *** periods referred to above
is
lower than GDR for the relevant period, Embraer shall diligently,
after
notification by Buyer:
|
1. |
Make
recommendations concerning Buyer's programs, publications and maintenance
and operational policies to improve
ADRP.
|
2. |
Take
all measures, as deemed necessary and appropriate by Embraer when
vendor
action does not provide the required improvement in the
ADRP.
|
3. |
***
Embraer shall issue a proposal to Buyer showing the price of the
relevant
Service Bulletin and the effectiveness of such modification for
Buyer.
|
c. |
In
the event the average ADRP at the end of any of the *** periods described
in paragraph “II.a.” is lower than the GDR for such period, Embraer shall
credit Buyer for Maintenance Interruptions calculated according to
the
following formula:
|
***
In
the
event the average ADRP at the end of any of the *** periods described in
paragraph “II.a.” above is *** for such period, the *** calculated according to
the formula above shall be ***.
Measurements
will be calculated and submitted by Buyer *** after the end of each *** referred
to in Article II a. herein. The Parties shall do their efforts to reach an
agreement over the data *** of the submission thereof. Any achieved credit
amount will be credited to Buyer or to Embraer *** after each agreement date
for
each of the ***. Buyer may use such credit only toward ***. Embraer may use
such
credit only for ***.
The
sum
of all credits under this Dispatch Reliability Guarantee shall not exceed ***
for Buyer’s entire Aircraft fleet for the *** periods.
d. |
This
dispatch reliability guarantee is based upon the following assumptions
provided by Buyer, and any change to the assumptions shall be cause
for
reevaluation or adjustments of this guarantee upon the reasonable
agreement of the Parties.
|
Fleet
Size:
Minimum
of ***.
Utilization:
The
guarantee covers a minimum of *** flight hours per cycle, *** APU hour per
flight hour plus or minus *** APU hour per flight hour and *** APU cycle per
flight cycle plus or minus *** APU cycle per flight cycle. Buyer's
fleet-wide average
annual Aircraft utilization shall be *** flight hours, plus or minus
***.
For
all
purposes of this guarantee, the regularly scheduled revenue Aircraft departures
and the Maintenance Interruptions related to the SAC Aircraft, Owned Aircraft
and GECC Aircraft shall be accounted for at the time these aircraft start their
revenue service by Buyer under this Purchase Agreement. All previous regularly
scheduled revenue Aircraft departures and Maintenance Interruptions shall be
disregarded.
e. |
The
following elements are not covered under this guarantee:
|
- Interruptions
of scheduled flights due to reasons other than Aircraft mechanical failures,
including without limitation:
- Air
Traffic Control
- Weather,
acts of God, FOD, wars, riots, third party criminal acts
- Accidents
- Incidents
- Negligence
___________
***Confidential
-17-
- Conditions
that exist prior to dispatch which lead to a flight interruption and could
have
been prevented by maintenance prior to dispatch (including but not limited
to
worn, flat and cut tires, servicing (ATA Chapter 12), dead batteries, and worn
brakes)
- Hard
landing.
- Late
out
of maintenance
- Force
majeure
- Crew
refusal
- Optional
equipment other than that identified on Attachment “A” to this
Agreement
- Operational
delays or cancellations not related to maintenance
- Passenger
and/or baggage loading
- Non-availability
of spares or equipment
- Non-availability
of personnel
- Operation
interruptions or Maintenance Interruptions, which occurred due to items, related
in the Minimum Equipment List (“XXX”) issued and/or approved by the local
regulatory authority was followed
- If
the
Aviation Authority grounds Buyer's fleet, or one of Buyer’s
Aircraft
- Maintenance
problems caused by Buyer’s negligence or misuse of parts or Buyer’s failure to
take all maintenance actions on the Aircraft as recommended in all applicable
maintenance manuals
- Maintenance
problems involving Aircraft or parts that has/have been involved in an accident,
or when parts either defective or not complying to manufacturer’s design or
specification have been used.
- Maintenance
problems involving parts that have had their identification marks, designation,
seal or serial number altered or removed
- Maintenance
problem resulting from inadequate packing for shipment and storage
- A
flight
interruption
shall
not be considered as a Maintenance Interruption if, at the time of the
interruption, Buyer has a spare aircraft in its fleet, even though for a
different model, that could commercially reasonable be used to avoid such
interruption and is not otherwise deployed in service
- Regulatory
changes compliance
- Cancellations
or delays caused by components repaired in non-approved local airworthiness
authority shop
- Flight
cancellation or delay occurred due to one same problem on the same Aircraft
within fourteen (14) consecutive days period.
_____________
***Confidential
-18-
III. |
The
foregoing dispatch reliability guarantee is provided subject to Buyer's
adherence in all material respects to the following general
conditions:
|
a. |
Airplane
Operation: Aircraft shall be operated in airline service in accordance
with the Aviation Authority regulations and as recommended by Embraer
through the official and most updated Operations and Airplane Flight
Manual. Buyer shall have available one spare Aircraft for each twenty
Aircraft at all times.
|
b. |
Inspection
Program: The Aircraft shall be maintained in accordance with the
most
current MRB document. Buyer’s program must have provisions for escalating
the checks intervals as soon as the Aviation Authority allows. Buyer’s
program should also include the use of task cards to assist the
maintenance personnel in performing inspection tasks.
|
c. |
Aircraft
Manuals: Buyer shall keep a complete set of Embraer recommended manuals
up-to-date and available to airline personnel for assisting them
with the
maintenance and operation of the Aircraft. A set of recommended manuals
should be available at all maintenance bases (line or heavy) and
shall be
maintained with the latest revisions at all times.
|
d. |
XXX:
Buyer shall keep its XXX up to date, with the most current issue.
|
e. |
Stocking
Levels: Buyer shall be responsible to stock and maintain the recommended
spare parts list (RSPL) in inventory, throughout the guarantee period.
There shall be a minimum inventory level at each line maintenance
base
along with the major parts being stored at the heavy maintenance
facility.
In the event during the ADR meetings, the Aircraft does not achieve
the
guaranteed values, and if the cause of this non-performance is the
lack of
spare parts initially recommended by Embraer for the RSPL and not
purchased by Buyer, this guarantee will not be applicable. Embraer
is to
receive annually an inventory list from the Buyer that shows current
stocking levels and the locations of all Aircraft spare parts and
will
make any recommendations on additional inventory if needed.
|
f. |
Parts
Repair: All shop repairs shall be performed in Embraer’s or Embraer’s
suppliers' authorized repair shops.
|
g. |
Staff
Levels: Buyer shall have available reasonable staff to properly maintain
the Aircraft during scheduled and unscheduled maintenance. This shall
include, but not be limited to, mechanics, electricians, avionics
specialists, inspectors, cleaners, ground personnel and flight crews
licensed or certified by the Aviation Authority as required by Aviation
Authority regulations.
|
h. |
Training:
Buyer is required to put in place a training program approved by
the
Aviation Authority, which, at a minimum, shall include the following
items:
|
1. |
Initial
and recurrent training for pilots in the
Aircraft;
|
2. |
Initial
and recurrent training for flight attendants in the Aircraft;
and
|
3. |
Initial
and recurrent training for the maintenance staff (airframe, power
plant,
electric avionics specialists) in the Aircraft.
|
Any
maintenance specialist (engine, APU, avionics) will require suppliers' training.
Buyer
is
required to train to the above standards any new hired employee who will work
in
or on the Aircraft.
i. |
Aircraft
Cleaning: Buyer shall keep the Aircraft reasonably clean, inside
and out,
by commercial airline standards at all times. This includes without
limitation, the engines, wheel xxxxx, nacelles, landing gear and
flight
control areas.
|
j. |
Service
Bulletins: When Embraer recommends that Buyer implement a service
bulletin
which improves performance or dispatch reliability, enhances flight
operations or decreases maintenance costs, ***, and Buyer concludes
by a
cost benefit analysis that the SB is commercially reasonable, Embraer
Customer Support Department shall contact Buyer's Vice President
of
Maintenance, in writing, with recommendations that the service bulletin
be
complied with. Buyer will schedule the Aircraft for incorporation
of such
service bulletin ***, but, subject to Embraer agreement which shall
not be
unreasonably withheld, Buyer may schedule it for incorporation during
a
maintenance check, so as to minimize interruption to scheduled
service.
|
k. |
Ground
Support Equipment: Embraer shall provide Buyer two lists of tooling
and
ground support equipment required to maintain the Aircraft, which
lists
shall be subject to Buyer's reasonable approval. One list will cover
line
maintenance bases while the other will apply to heavy maintenance
facilities. Buyer will be required to maintain these levels of required
tooling and ground support equipment in good working order at all
times.
|
l. |
Reliability
Reporting: Buyer shall monthly provide to Embraer, in electronic
format, a
reliability and maintenance cost report in accordance with the latest
revision of the Embraer’s Service News Letter for data
exchange.
|
___________
***Confidential
-19-
m. |
Rejection:
Buyer shall not unreasonably reject Embraer's recommendations / changes
/
solutions which in Embraer's opinion, would result in an improvement
in
Buyer's dispatch reliability. Any such rejection shall be cause for
re-evaluation and/or adjustment of this guarantee. Anything in this
Agreement to the contrary notwithstanding, Buyer shall not be required
to
comply with or implement, and the benefits and rights provided Buyer
hereunder will not be adversely affected by, Buyer’s not complying with or
implementing any Embraer recommendation / changes / solutions (including
without limitation, recommended service bulletins) or any provision
of
applicable product literature for which compliance is not mandated
by the
local airworthiness authority rules and regulations if Buyer has
determined in good faith that such recommendation / change / solution
or
provision of such product literature is not reasonably expected to
result
in a net economic benefit to Buyer in light of all applicable facts
and
circumstances, including, without limitation, the number of man-hours
reasonably estimated by Embraer to be required to accomplish such
recommendation / change / solution, the labor cost to be incurred,
the
potential reduction in maintenance costs to be realized, the time
value of
money and the period which would be required for such savings resulting
from the improvement in dispatch reliability to offset the labor
and other
costs associated with such man-hours (provided that Buyer may not
consider
any benefits to Buyer under any product guarantees to the extent
resulting
from Buyer’s decision to comply or not to comply with or implement a
recommendation, change, or
solution).
|
n. |
Certification
or Regulatory Changes: The achieved maintenance interruption shall
not
take into account those interruptions, which were originated by conformity
to mandatory regulatory change.
|
o. |
Achieved
Dispatch Reliability Review Meeting: An Achieved Dispatch Reliability
Review Meeting shall be scheduled, if necessary, and at the end of
each
six (6) month period of Buyer's Aircraft operation. Representatives
of
Buyer and Embraer shall participate in the meetings and will:
|
1. |
Review
current Achieved Dispatch Reliability;
|
2. |
Eliminate
irrelevant or non-Aircraft-intrinsic interruption claims from computed
cancellation rates; and
|
3. |
Review
Buyer's compliance with Service Bulletins as required by Article
III.j
herein, review disputed claims, and consider methods for improvement
of
Achieved Dispatch Reliability.
|
Buyer
shall permit Embraer access to all Buyer data which can be used in understanding
and analyzing the dispatch reliability failure.
p. |
Duplicated
Guarantee: If Buyer negotiates directly with any of Embraer’s
suppliers/vendors a particular dispatch or completion reliability
guarantee, or an alternative support program with Embraer, this
amount shall be excluded from the guarantee rate, specified in Article
III.a, and shall result in an appropriate recalculation of this guarantee
in accordance with Embraer
criteria.
|
IV. |
Suspension
|
a. |
This
guarantee shall be automatically suspended and shall not apply during
the
period of any labor disruption or dispute involving a significant
work
action, which affects in whole or in part the Aircraft normal operation
and maintenance.
|
b. |
This
guarantee shall be automatically suspended and shall not apply during
the
computation period of which worldwide EMBRAER 170 fleet (excluding
Buyer’s
Aircraft) average dispatch reliability percentage is at least 1%
higher
than Buyer’s Aircraft dispatch reliability
percentage.
|
V. |
Buyer
will not include in the calculation of the ADRP Maintenance Interruptions
occurring under any of the circumstances listed
below:
|
a. |
When
the Aircraft has been used in an attempt to break records, or subjected
to
experimental flights, or in any other way not in conformity with
the
flight manual or the airworthiness certificate, or subject to any
manner
of use in contravention of the applicable aerial navigation or other
regulations or rules, issued or recommended by government authorities
of
whatever country in which the Aircraft is operated, when accepted
and
recommended by ICAO; and
|
b. |
When
the Aircraft or any of its parts has/have been altered or modified
by
Buyer, without prior approval from Embraer or from the manufacturer
of the
parts through a service bulletin, provided such approval has not
been
unreasonably withheld.
|
VI. |
THE
GUARANTEES, OBLIGATIONS AND LIABILITIES OF EMBRAER, AND REMEDIES
OF BUYER
SET FORTH IN THIS SCHEDULE RELIABILITY GUARANTEE ARE EXCLUSIVE AND
IN
SUBSTITUTION FOR, AND BUYER HEREBY WAIVES, RELEASES AND RENOUNCES,
ALL
OTHER RIGHTS, CLAIMS, DAMAGES AND REMEDIES OF BUYER AGAINST EMBRAER
OR ANY
ASSIGNEE OF EMBRAER, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE,
WITH
RESPECT TO ANY ACHIEVED DISPATCH
RELIABILITY.
|
VII. |
The
terms and conditions of this dispatch reliability guarantee do not
alter,
modify or impair, in any way, the terms and conditions of Attachment
“C“
(Aircraft Warranty Certificate) to the Purchase
Agreement.
|
VIII. |
The
guarantee hereby expressed is established between Embraer and Buyer
and it
cannot be transferred or assigned to others, unless by previous written
consent of Embraer.
|
__________
***Confidential
-20-
ATTACHMENT
"H-1" - PERFORMANCE GUARANTEE
EMBRAER
175
1.
|
GUARANTEES
|
Embraer,
subject to the conditions and limitations hereby expressed, and considering
the
Aircraft EMBRAER 175 LR version with a maximum takeoff weight of ***lb (
***kg),
equipped with Embraer furnished General Electric CF34-8E5 engines, guarantees
that each Aircraft on the relevant Actual Delivery Date shall comply with
the
following performance:
1.1
|
CRUISE
SPECIFIC AIR RANGE
|
The
cruise specific air range(SAR) in a standard day (ISA), at the aircraft gross
weights, pressure altitudes and Mach numbers noted below shall not be less
than
the guarantee value:
*
2.
|
AIRCRAFT
CONFIGURATION
|
2.1 The
guarantees stated above are based on the Aircraft configuration as defined
in
the Technical Description PTD-175 Rev. 5 dated April 2005, plus specific
Buyer
configuration options as defined at Attachment “A” to the Purchase Agreement,
(hereinafter referred to as the “Detail Specification”). If necessary,
appropriate adjustment to this Aircraft Performance Guarantees shall be made
for
changes in such Detail Specification (including but not limited to Buyer
requests for changes, Proposal of Major Changes or any other changes mutually
agreed upon between the Buyer and Embraer) approved in writing by the Buyer
and
Embraer. Such adjustments shall be accounted for by Embraer in its evidence
of
compliance with the guarantees.
In
the
event a change is made to any law, governmental regulation or requirement,
or in
the interpretation of any such law, governmental regulation or requirement
that
affects the certification basis for the Aircraft, and as a result thereof,
a
change is made to the configuration and/or the performance of the Aircraft
in
order to obtain certification, the guarantees set forth in this Aircraft
Performance Guarantee shall be appropriately modified to reflect any such
change.
2.2 The
performance guarantees of Article 1 of this Attachment shall be adjusted
by
Embraer for the following in its evidence of compliance with such
guarantees:
a. Changes
to the Detail Specification including Major Changes or any other changes
mutually agreed upon between the Buyer and Embraer.
b. The
difference between the weight allowances of optional items listed in the
Detail
Specification and the actual weights.
3.
|
GUARANTEE
CONDITIONS
|
3.1 All
guaranteed performance data are based on the ICAO International Standard
Atmosphere (ISA) unless otherwise specified. Altitudes are pressure
altitudes.
3.2 The
FAA
Regulations referred to in this Attachment are, unless otherwise specified,
the
Certification Basis regulations specified in the Aircraft Type Certificate
Data
Sheet.
3.3 The
cruise specific air range and the climb, cruise and descent portions of the
mission guarantees include allowances for normal electrical power extraction
and
normal operation of the air conditioning system. Normal power extraction
shall
be defined as not less than a 41 kW total electrical and hydraulic loads.
Normal
operation of the air conditioning system shall be defined as operation in
the
automatic mode, with the temperature control set to maintain a nominal cabin
temperature of 70 °F,
and
all air conditioning systems operating normally. This operation nominally
allows
a maximum cabin pressure differential of *** lb per square inch, with a nominal
Aircraft cabin ventilation rate of *** cu.ft per min at *** ft including
passenger cabin recirculation (nominal recirculation is ***). The APU is
turned
off unless otherwise specified. 3.5 The
cruise specific air range, speed and the climb, cruise, and descent portions
of
the mission guarantees are based on an Aircraft center of gravity location
of
*** of the mean aerodynamic chord.
3.6 Performance,
where applicable, is based on a fuel Lower Heating Value (LHV) of 18,580
BTU per
pound and a fuel density of 6.7 lb per U.S. gallon.
_____________
***Confidential
-21-
4.
|
PARTIES’
OBLIGATIONS ACCORDING TO THIS
GUARANTEE
|
4.1 During
the Aircraft acceptance to be performed by Buyer in accordance with Article
7 of
the Purchase Agreement, Buyer shall check the Aircraft performance specified
in
Article 1 of this Attachment H, by using the Aircraft Flight Manual (AFM)
or by
comparing the flight test data, at the atmospheric conditions prevailing
during
the flight, with the information presented in the Supplementary Performance
Manual (SPM), as applicable. All performance guarantee under this Attachment
are
in accordance with both manuals above mentioned, taking into consideration
the
established tolerances.
4.2 Embraer’s
obligations in respect to the guarantees stated in Article 1 of this Attachment
are limited to Buyer’s right to ***, should it be reasonably verified that such
Aircraft, during the acceptance procedure specified in Article 7 of the Purchase
Agreement, cannot comply with the performances guaranteed hereunder, after
Embraer has had a reasonable opportunity to cure such deficiencies in accordance
with Article 7 of the Purchase Agreement. ***
4.3 In
case,
during the above mentioned acceptance procedure, it is proven that the Aircraft
performance does not comply with the performances specified in Article 1
of this
Attachment, but Buyer considers it satisfactory by accepting delivery of
such
Aircraft, then Embraer shall not be liable to any claim or demand whatsoever
from Buyer with respect to such performance guarantees.
4.4 Upon
acceptance of the Aircraft by Buyer, all obligations of Embraer regarding
the
Aircraft performance guarantees shall cease.
5.
|
GUARANTEE
COMPLIANCE
|
5.1 | Compliance with the guarantees of Article 1 of this Attachment shall be based on the conditions specified in that article, the Aircraft configuration contained in Attachment “A” to the Purchase Agreement and the guarantee conditions of Article 3 above. |
5.2 |
Compliance
with the cruise specific air range, and the climb, cruise and descent
portions of the mission guarantees shall be established by calculations
based on the comparison mentioned in paragraph 4.1 above.
|
5.3 |
The
data derived from tests shall be adjusted as required by conventional
methods of correction, interpolation or extrapolation in accordance
with
established engineering practices to show compliance with the performance
guarantee.
|
5.4 |
Compliance
with the Equipped Empty Weight guarantee shall be based on information
in
the appropriate approved weight and balance manual, and associated
document or report.
|
6.
|
EXCLUSIVE
GUARANTEES
|
6.1
|
The only performance guarantees applicable to the Aircraft are those set forth in this document. The performance guarantees set forth herein are established between Buyer and Embraer and may not be transferred or assigned to others, unless by previous written consent of Embraer. |
6.2
|
THE GUARANTEES, OBLIGATIONS AND LIABILITIES OF EMBRAER, AND REMEDIES OF BUYER SET FORTH IN THIS PERFORMANCE GUARANTEE ARE EXCLUSIVE AND IN SUBSTITUTION FOR, AND BUYER HEREBY WAIVES, RELEASES AND RENOUNCES, ALL OTHER RIGHTS, CLAIMS, DAMAGES AND REMEDIES OF BUYER AGAINST EMBRAER OR ANY ASSIGNED OF EMBRAER, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO ANY ACHIEVED PERFORMANCE. |
The
terms
and conditions of this performance guarantee do not alter, modify or impair,
in
any way, the terms and conditions of Attachment “C” (Aircraft Warranty
Certificate)
to
the Purchase Agreement.
_____________
***Confidential
-22-