EXHIBIT 10.1
Redacted Copy (Deletions ***)
Supplemental Agreement No. 15
to
Purchase Agreement No. 1810
between
The Boeing Company
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 737-7H4 Aircraft
THIS SUPPLEMENTAL AGREEMENT, entered into as of JANUARY 16, 2001, by
and between THE BOEING COMPANY, a Delaware corporation with its principal
offices in Seattle, Washington, (Boeing) and SOUTHWEST AIRLINES CO., a Texas
corporation with its principal offices in City of Dallas, State of Texas
(Buyer);
WHEREAS, the parties hereto entered into Purchase Agreement No. 1810
dated January 19, 1994, relating to Boeing Model 737-7H4 aircraft (the
Agreement) and;
WHEREAS, Buyer has agreed to accelerate two (2) Block E Aircraft from
July 2001 to June 2001, and to accelerate three (3) Block I Aircraft from
January 2002 to one (1) December 2001 and two (2) November 2001, and to
accelerate one (1) Block T Aircraft from May 2002 to November 2001.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree to amend the Agreement as follows:
1. The Table of Contents of the Agreement is deleted in its entirety and a new
Table of Contents is attached hereto and incorporated into the Agreement by this
reference.
2. Article 2, entitled "Delivery, Title and Risk of Loss," paragraph 2.1,
entitled "Time of Delivery," is deleted in its entirety and replaced by a new
paragraph 2.1 revised to change the quantity of
*** PURSUANT TO 17 CFR 240.24b-2, CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE COMMISSION.
SA-15-1
P.A. No. 1810
K/SWA
Block E Aircraft delivering in July 2001 from three (3) to one (1), to add two
(2) Block E Aircraft delivering in June 2001, to change the quantity of Block I
Aircraft delivering in January 2002 from four (4) to one (1), to add two (2)
Block I Aircraft delivering in November 2001, and to add one (1) Block I
Aircraft delivering in December 2001, to change the quantity of Block T Aircraft
delivering in May 2002 from two (2) to one (1), and to add one (1) Block T
Aircraft delivering in November 2001. Such new pages 2-1, 2-2 and 2-3 are
attached hereto and incorporated into the Agreement by this reference.
3. Article 3, entitled "Price of Aircraft", paragraph 3.4 entitled "Advance
Payment Base Price", subparagraph 3.4.1 entitled "Advance Payment Base Price" is
revised by adding an Advance Payment Base Price for the Block E Aircraft
delivering in June 2001, the Block on Block T Aircraft delivering in November
2001. Such new pages 3-1, 3-2, 3-3 and 3-4 are attached hereto and incorporated
into the Agreement by this reference.
4. All references in the Letter Agreements associated with Purchase Agreement
No. 1810 shall be deemed to refer to the purchase by Buyer of two hundred thirty
six Model 737-7H4 Aircraft, eighty seven (87) Model 737-7H4 Option Aircraft and
two hundred seventeen (217) Model 737-7H4 Rollover Option Aircraft, to the
extent such reference is not specifically addressed herein.
5. As a result of this Supplemental Agreement, Buyer owes Boeing ***. Such
amount reflects the difference in advance payments due as a result of the
acceleration of the two (2) Block E Aircraft, the three (3) Block I Aircraft,
and the one (1) Block T Aircraft. Buyer will pay Boeing *** upon execution of
this agreement and will reduce the amount paid to Boeing on February 1, 2001 for
Advance Payments of *** by ***.
The Agreement will be deemed to be supplemented to the extent herein provided
and as so supplemented will continue in full force and effect.
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY SOUTHWEST AIRLINES CO.
By: /s/ X. X. XXXXXXXX By: /s/ XXXXX XXXXXX
----------------------- -------------------
Its: Attorney-In-Fact Its: Treasurer
---------------------- ------------------
XX-00-0
X.X. Xx. 0000
X/XXX
XXXXXXXX AGREEMENT
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 000-0X0 Xxxxxxxx
Xxxxxxxx Agreement Number 1810
P.A. No. 1810
K/SWA
TABLE OF CONTENTS
Page SA
ARTICLES Number Number
-------- ------ ------
1. Subject Matter of Sale..........................................1-1 SA-13
2. Delivery, Title and Risk
of Loss.........................................................2-1 SA-15
3. Price of Aircraft...............................................3-1 SA-15
4. Taxes...........................................................4-1
5. Payment.........................................................5-1
6. Excusable Delay.................................................6-1
7. Changes to the Detail
Specification...................................................7-1 SA-1
8. Federal Aviation Requirements and
Certificates and Export License.................................8-1
9. Representatives, Inspection,
Flights and Test Data...........................................9-1
10. Assignment, Resale or Lease....................................10-1
11. Termination for Certain Events.................................11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance..................................................12-1
13. Buyer Furnished Equipment and
Spare Parts....................................................13-1
14. Contractual Notices and Requests...............................14-1
15. Miscellaneous..................................................15-1
i
P.A. No. 1810 SA-15
K/SWA
TABLE OF CONTENTS
SA
EXHIBITS Number
-------- ------
A Aircraft Configuration SA-13
B Product Assurance Document SA-1
C Customer Support Document
D Price Adjustments Due to
Economic Fluctuations - Aircraft SA-13
E Buyer Furnished Equipment
Provisions Document
F Defined Terms Document
LETTER AGREEMENTS
-----------------
1810-1 Waiver of Aircraft Demonstration Flight
ii
P.A. No. 1810 SA-15
K/SWA
TABLE OF CONTENTS
SA
RESTRICTED LETTER AGREEMENTS Number
---------------------------- ------
6-1162-RLL-932R2 Promotional Support SA-13
6-1162-RLL-933R9 Option Aircraft SA-13
6-1162-RLL-934R3 Disclosure of Confidential SA-14
Information
6-1162-RLL-935R1 Performance Guarantees XX-0
0-0000-XXX-000X0 Xxxxxxx Contractual Matters XX-0
0-0000-XXX-000 Xxxxxxxxx Advance Payment Schedule
6-1162-RLL-938 ***
6-1162-RLL-939R1 Certification Flight Test Aircraft SA-1
6-1162-RLL-940R1 Training Matters SA-1
6-1162-RLL-941R2 Other Matters SA-13
6-1162-RLL-942 Open Configuration Matters
6-1162-RLL-943R1 Substitution Rights XX-0
0-0000-XXX-000 Xxxxxxxx Maintenance Material Cost
Protection Program
6-1162-RLL-945 Comparison of 737-7H4 and 000-0X0
Xxxxx Xxxx Xxxx
0-0000-XXX-0000X0 Additional Contractual Matters SA-4
6-1162-RLL-1856 *** SA-1
6-1162-RLL-1857 Service Ready Validation Program SA-1
Field Test
6-1162-RLL-1858R1 Escalation Matters SA-4
iii
P.A. No. 1810 SA-15
K/SWA
TABLE OF CONTENTS CON'T
SA
RESTRICTED LETTER AGREEMENTS Number
---------------------------- ------
6-1162-RLL-2036 Amortization of Costs for
Customer Unique Changes XX-0
0-0000-XXX-0000 Xxxxxxxxxxxxxx of the Aircraft SA-1
Basic Price
6-1162-RLL-2073 Maintenance Training Matters SA-1
6-1162-KJJ-054 Business Matters SA-13
6-1162-KJJ-055 Structural Matters SA-13
6-1162-KJJ-056 Noise and Emission Matters SA-13
6-1162-KJJ-057 Product Development Matters SA-13
6-1162-KJJ-058 Additional Substitution Rights SA-13
6-1162-KJJ-150 Flight Control Computer & Mode SA-14
Control Panel Spares Matter
iv
P.A. No. 1810 SA-15
K/SWA
PURCHASE AGREEMENT NO. 1810
Relating to
BOEING MODEL 737-7H4 AIRCRAFT
----------
This Agreement is entered into as of January 19th 1994, by and between
The Boeing Company, a Delaware corporation, with its principal office in
Seattle, Washington (Boeing), and
Southwest Airlines Co., a Texas corporation,
with its principal office in the City of Dallas, State of Texas (Buyer).
Accordingly, Boeing and Buyer agree as follows:
1
P.A. No. 1810
K/SWA
ARTICLE 1. Subject Matter of Sale.
1.1 The Aircraft. Subject to the terms and conditions of this
Agreement, Boeing will manufacture and deliver to Buyer and Buyer will purchase
and accept delivery from Boeing of one hundred forty-two (142) Boeing Model
737-7H4 aircraft (the Aircraft) manufactured in accordance with Boeing Detail
Specification D6-38808-1, dated October 30, 1996, as described in Exhibit A, and
ninety-four (94) Boeing Model 737-7H4 (the Aircraft) manufactured in accordance
with Boeing Detail Specification D6-38808-1, Revision A, dated February 24, 1998
as described in Exhibit A-1, as modified from time to time in accordance with
this Agreement (Detail Specification).
1.2 Additional Goods and Services. In connection with the sale of the
Aircraft, Boeing will also provide to Buyer certain other things under this
Agreement, including data, documents, training and services, all as described in
this Agreement.
1.3 Performance Guarantees. Any performance guarantees applicable to
the Aircraft will be expressly included in this Agreement. Where performance
guarantees are included in this Agreement other than within the Detail
Specification, such guarantees will be treated as being incorporated in the
Detail Specification by this reference.
1.4 Defined Terms. For ease of use, certain terms are treated as
defined terms in this Agreement. Such terms are identified with a capital letter
and set forth and/or defined in Exhibit F.
1-1
P.A. No. 1810 SA-13
K/SWA
ARTICLE 2. Delivery, Title and Risk of Loss.
2.1 Time of Delivery. The Aircraft will be delivered to Buyer by
Boeing, assembled and ready for flight and Buyer will accept delivery of the
Aircraft, in accordance with the following schedule:
Month and Year
of Delivery Quantity of Aircraft
-------------- --------------------
Block A Aircraft
October 1997 Two (2)
November 1997 Two (2)
Block B Aircraft
January 1998 Two (2)
February 1998 Three (3)
March 1998 Two (2)
April 1998 Two (2)
May 1998 Two (2)
June 1998 One (1)
July 1998 Two (2)
September 1998 Two (2)
Block C Aircraft
February 1999 Four (4)
May 1999 Four (4)
July 1999 Four (4)
August 1999 One (1)
September 1999 Three (3)
Block D Aircraft
November 1999 Two (2)
December 1999 One (1)
January 0000 Xxx (1)
March 2000 Four (4)
July 2000 Four (4)
August 2000 Three (3)
Block E Aircraft
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Two (2)
July 2001 One (1)
September 2001 Three (3)
2-1
P.A. Xx. 0000 XX-00
X/XXX
Xxxxx F Aircraft
October 1998 One (1)
November 1998 Two (2)
December 1998 Two (2)
Block G Aircraft
March 1999 Two (2)
Block H Aircraft
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
October 2001 Three (3)
Block I Aircraft
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
April 2002 Two (2)
July 2002 Four (4)
October 2002 Four (4)
Block J Aircraft
January 2003 Four (4)
March 2003 One (1)
Block K Aircraft
April 2004 Two (2)
July 2004 Three (3)
Block L Aircraft
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
2-2
P.A. No. 1810 SA-15
K/SWA
October 0000 Xxx (1)
November 2000 Four (4)
December 0000 Xxx(1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
September 2001 One (1)
October 2001 One (1)
September 2002 Three (3)
Block T Aircraft
November 2001 One (1)
February 2002 One (1)
May 2002 One (1)
June 2002 Two (2)
July 2002 One (1)
August 2002 Two (2)
November 2002 Two (2)
February 2003 One (1)
May 2003 Two (2)
June 2003 Two (2)
August 2003 Three (3)
February 2004 Three (3)
March 2004 Three (3)
April 2004 One (1)
May 2004 Four (4)
June 2004 Three (3)
July 2004 Two (2)
August 2004 Two (2)
September 2004 Two (2)
October 2004 Two (2)
November 2004 Two (2)
February 2005 One (1)
May 2005 One (1)
June 2005 One (1)
August 2005 One (1)
September 2005 One (1)
February 2006 Three (3)
March 2006 One (1)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
2-3
P.A. No. 1810 SA-15
K/SWA
July 2007 Two (2)
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
2.2 Notice of Target Delivery Date. Boeing will give Buyer notice of
the Target Delivery Date of the Aircraft approximately 30 days prior to the
scheduled month of delivery.
2.3 Notice of Delivery Date. If Boeing gives Buyer at least 7 days'
notice of the delivery date of the Aircraft, and an Aircraft delivery is delayed
beyond such delivery date due to the responsibility of Buyer, Buyer will
reimburse Boeing for all costs incurred by Boeing as a result of such delay,
including amounts for storage, insurance, Taxes, preservation or protection of
the Aircraft and interest on payments due.
2.4 Place of Delivery. The Aircraft will be delivered at an airport
facility selected by Boeing in the State of Washington, unless mutually agreed
otherwise.
2.5 Title and Risk of Loss. Title to and risk of loss of an Aircraft
will pass from Boeing to Buyer upon delivery of such Aircraft, but not prior
thereto.
2.6 Xxxx of Sale. Upon delivery of an Aircraft Boeing will deliver to
Buyer a xxxx of sale conveying good title to such Aircraft, free of all liens,
claims, charges and encumbrances of every kind whatsoever, and such other
appropriate documents of title as Buyer may reasonably request.
2-4
P.A. No. 1810 SA-15
K/SWA
ARTICLE 3. Price of Aircraft.
3.1 Definitions.
3.1.1 Special Features are the features incorporated in
Exhibit A which have been selected by Buyer.
3.1.2 Base Aircraft Price is the Aircraft Basic Price
excluding the price of Special Features.
3.1.3 Aircraft Basic Price is comprised of the Base Aircraft
Price and the price of the Special Features.
3.1.4 Economic Price Adjustment is the adjustment to the
Aircraft Basic Price (Base Aircraft and Special Features) as calculated pursuant
to Exhibit D or Exhibit D-1 as applicable.
3.1.5 Aircraft Price is the total amount Buyer is to pay for
the Aircraft at the time of delivery.
3.2 Aircraft Basic Price.
The Aircraft Basic Price for Block A through L Aircraft, is
expressed in July 1992 dollars; the Aircraft Basic Price for Block T Aircraft,
is expressed in July 1999 dollars; as set forth below:
Base Special Aircraft
Aircraft Price Features Basic Price
Block A, B, C, *** ***
D & E Aircraft ***
Block F & G *** ***
Aircraft ***
Block H *** ***
Aircraft ***
Block I *** ***
Aircraft ***
Block J *** ***
Aircraft ***
Block K *** ***
Aircraft ***
Block L *** ***
Aircraft ***
Block T *** *** ***
Aircraft
15-1
P.A. No. 1810
K/SWA
3.3 Aircraft Price. The Aircraft Price will be established at the time
of delivery of such Aircraft to Buyer and will be the sum of:
3.3.1 the Aircraft Basic Price, which is *** for the Block A,
B, C, D and E Aircraft, *** for the Block F and G Aircraft, *** for the Block H
Aircraft, *** for the Block I Aircraft, *** for the Block J Aircraft, *** for
the Block K Aircraft and *** for the Block L Aircraft; *** for the Block T
Aircraft; plus
3.3.2 the Economic Price Adjustments for the Aircraft Basic
Price, as calculated pursuant to the formulas set forth in Exhibit D (Price
Adjustments Due to Economic Fluctuations - Aircraft) for Aircraft Block A
through L, and in Exhibit D-1 (Price Adjustments Due to Economic Fluctuations -
Aircraft) for Aircraft Block T; plus
3.3.3 other price adjustments made pursuant to this Agreement
or other written agreements executed by Boeing and Buyer.
3.4 Advance Payment Base Price.
3.4.1 Advance Payment Base Price. For advance payment
purposes, the following estimated delivery prices of the Aircraft (Advance
Payment Base Price) have been established, using currently available forecasts
of the escalation factors used by Boeing as of the date of signing this
Agreement. The Advance Payment Base Price of each Aircraft is set forth below:
Month and Year of Advance Payment Base
Scheduled Delivery Price per Aircraft
Block A Aircraft***
October 1997
November 1997
Block B Aircraft***
January 1998
February 1998
March 1998
April 1998
May 1998
June 1998
July 1998
September 1998
00-0
X.X. Xx. 0000
X/XXX
Xxxxx C Aircraft***
February 1999
May 1999
July 1999
August 1999
September 1999
Block D Aircraft***
November 1999
December 1999
January 2000
March 2000
July 2000
August 2000
Block E Aircraft***
December 2000
January 2001
February 2001
March 2001
June 2001
July 2001
September 2001
Block F Aircraft***
October 1998
November 1998
December 1998
Block G Aircraft***
March 1999
Block H Aircraft***
June 1999
July 1999
August 1999
September 1999
October 1999
March 2000
April 2000
September 2000
October 2000
March 2001
April 2001
October 2001
00-0
X.X. Xx. 0000
X/XXX
Xxxxx I Aircraft***
November 2001
December 2001
January 2002
March 2002
April 2002
July 2002
October 2002
Block J Aircraft***
January 2003
March 2003
Block K Aircraft***
April 2004
July 2004
Block L Aircraft***
October 1999
November 1999
December 1999
June 2000
July 2000
September 2000
October 2000
November 2000
December 2000
January 2001
February 2001
July 2001
September 2001
October 2001
September 2002
Block T Aircraft***
November 2001
February 2002
May 2002
June 2002
July 2002
August 2002
November 2002
February 2003
May 2003
15-4
P.A. No. 1810
K/SWA
June 2003
August 2003
February 2004
March 2004
April 2004
May 2004
June 2004
July 2004
August 2004
September 2004
October 2004
November 2004
February 2005
May 2005
June 2005
August 2005
September 2005
February 2006
March 2006
May 2006
June 2006
July 2006
August 2006
September 2006
November 2006
December 2006
January 2007
February 2007
March 2007
April 2007
May 2007
June 2007
July 2007
August 2007
September 2007
October 2007
November 2007
December 2007
3.4.2 Adjustment of Advance Payment Base Prices - Long-Lead
Aircraft. For Aircraft scheduled for delivery 36 months or more after the date
of this Agreement, the Advance Payment Base Prices appearing in Article 3.4.1
will be used to determine the amount of the first advance payment to be made by
Buyer on the Aircraft. No later than 25 months before the scheduled month of
delivery of each affected Aircraft, Boeing will increase or decrease the Advance
Payment Base Price of such Aircraft as required to reflect the effects of (i)
any adjustments in the Aircraft Basic Price pursuant to this Agreement and (ii)
the then-current forecasted escalation factors used by Boeing. Boeing will
provide the adjusted Advance Payment Base Prices
15-5
P.A. No. 1810
K/SWA
for each affected Aircraft to Buyer, and the advance payment schedule will be
considered amended to substitute such adjusted Advance Payment Base Prices.
15-6
P.A. No. 1810
K/SWA
Supplemental Agreement No. 16
to
Purchase Agreement No. 1810
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 737-7H4 Aircraft
THIS
SUPPLEMENTAL AGREEMENT, entered into as of APRIL 30, 2001, by and
between THE BOEING COMPANY, a Delaware corporation with its principal offices in
Seattle, Washington, (Boeing) and
SOUTHWEST AIRLINES CO., a Texas corporation
with its principal offices in Dallas, Texas (Buyer);
WHEREAS, the parties hereto entered into Purchase Agreement No. 1810
dated January 19, 1994, relating to Boeing Model 737-7H4 aircraft (the
Agreement) and;
WHEREAS, Buyer has agreed to accelerate one (1) Block E Aircraft from
July 2001 to June 2001.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree to amend the Agreement as follows:
1. The Table of Contents of the Agreement is deleted in its entirety and a new
Table of Contents is attached hereto and incorporated into the Agreement by this
reference.
*** PURSUANT TO 17 CFR 240.24b-2, CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE COMMISSION.
SA-16-1
P.A. No. 1810
K/SWA
2. Article 2, entitled "Delivery, Title and Risk of Loss," paragraph 2.1,
entitled "Time of Delivery," is deleted in its entirety and replaced by a new
paragraph 2.1 revised to delete the one (1) of Block E Aircraft delivering in
July 2001 and change the quantity of Block E Aircraft delivering in June 2001
from two (2) to three (3). Such new pages 2-1, 2-2, 2-3 and 2-4 are attached
hereto and incorporated into the Agreement by this reference.
3. Article 3, entitled "Price of Aircraft", paragraph 3.4 entitled "Advance
Payment Base Price," subparagraph 3.4.1 entitled "Advance Payment Base Price" is
deleted in its entirety and replaced by a new subparagraph 3.4.1 revised to
delete the Advance Payment Base Price for the month of July 2001 Block E
Aircraft. Such new pages 3-1, 3-2, 3-3, 3-4, 3-5 and 3-6 are attached hereto and
incorporated into the Agreement by this reference.
4. As a result of this
Supplemental Agreement, Boeing will refund to Buyer the
amount ***. Such amount reflects the difference in advance payments due as a
result of the acceleration of the one (1) Block E Aircraft from July 2001 to
June 2001. The refund will be effected by Buyer (i) reducing advance payments in
the amount of *** due May 1, 2001 by ***, resulting in a total payment due May
1, 2001 of ***, and (ii) reducing advance payments in the amount of *** due June
1, 2001 by ***, resulting in a total payment due June 1, 2001 of. ***
The Agreement will be deemed to be supplemented to the extent herein provided
and as so supplemented will continue in full force and effect.
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY
SOUTHWEST AIRLINES CO.
By: XXXXXXX X. XXXXXXXX By: XXXXX XXXXXX
------------------------- --------------------------
Its: Attorney-In-Fact Its: Treasurer
------------------------- -------------------------
XX-00-0
X.X. Xx. 0000
X/XXX
XXXXXXXX AGREEMENT
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 000-0X0 Xxxxxxxx
Xxxxxxxx Agreement Number 1810
P.A. No. 1810
K/SWA
TABLE OF CONTENTS
Page SA
Number Number
------ ------
ARTICLES
--------
1. Subject Matter of Sale..........................................1-1 SA-13
2. Delivery, Title and Risk
of Loss.........................................................2-1 SA-16
3. Price of Aircraft...............................................3-1 SA-16
4. Taxes...........................................................4-1
5. Payment.........................................................5-1
6. Excusable Delay.................................................6-1
7. Changes to the Detail
Specification...................................................7-1 SA-1
8. Federal Aviation Requirements and
Certificates and Export License.................................8-1
9. Representatives, Inspection,
Flights and Test Data...........................................9-1
10. Assignment, Resale or Lease....................................10-1
11. Termination for Certain Events.................................11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance..................................................12-1
13. Buyer Furnished Equipment and
Spare Parts....................................................13-1
14. Contractual Notices and Requests...............................14-1
15. Miscellaneous..................................................15-1
i
P.A. No. 1810
K/SWA SA-16
TABLE OF CONTENTS
SA
Number
------
EXHIBITS
--------
A Aircraft Configuration SA-13
B Product Assurance Document SA-1
C Customer Support Document
D Price Adjustments Due to
Economic Fluctuations - Aircraft SA-13
E Buyer Furnished Equipment
Provisions Document
F Defined Terms Document
LETTER AGREEMENTS
-----------------
1810-1 Waiver of Aircraft Demonstration Flight
ii
P.A. No. 1810
K/SWA SA-16
TABLE OF CONTENTS
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-932R2 Promotional Support SA-13
6-1162-RLL-933R9 Option Aircraft SA-13
6-1162-RLL-934R3 Disclosure of Confidential SA-14
Information
6-1162-RLL-935R1 Performance Guarantees XX-0
0-0000-XXX-000X0 Xxxxxxx Contractual Matters XX-0
0-0000-XXX-000 Xxxxxxxxx Advance Payment Schedule
6-1162-RLL-938 ***
6-1162-RLL-939R1 Certification Flight Test Aircraft SA-1
6-1162-RLL-940R1 Training Matters SA-1
6-1162-RLL-941R2 Other Matters SA-13
6-1162-RLL-942 Open Configuration Matters
6-1162-RLL-943R1 Substitution Rights XX-0
0-0000-XXX-000 Xxxxxxxx Maintenance Material Cost
Protection Program
6-1162-RLL-945 Comparison of 737-7H4 and 000-0X0
Xxxxx Xxxx Xxxx
0-0000-XXX-0000X0 Additional Contractual Matters SA-4
6-1162-RLL-1856 *** SA-1
6-1162-RLL-1857 Service Ready Validation Program SA-1
Field Test
6-1162-RLL-1858R1 Escalation Matters SA-4
iii
P.A. No. 1810
K/SWA SA-16
TABLE OF CONTENTS CON'T
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-2036 Amortization of Costs for
Customer Unique Changes XX-0
0-0000-XXX-0000 Xxxxxxxxxxxxxx of the Aircraft SA-1
Basic Price
6-1162-RLL-2073 Maintenance Training Matters SA-1
6-1162-KJJ-054 Business Matters SA-13
6-1162-KJJ-055 Structural Matters SA-13
6-1162-KJJ-056 Noise and Emission Matters SA-13
6-1162-KJJ-057 Product Development Matters SA-13
6-1162-KJJ-058 Additional Substitution Rights SA-13
6-1162-KJJ-150 Flight Control Computer & Mode SA-14
Control Panel Spares Matter
iv
P.A. No. 1810
K/SWA SA-16
PURCHASE AGREEMENT NO. 1810
Relating to
BOEING MODEL 737-7H4 AIRCRAFT
----------
This Agreement is entered into as of January 19th 1994, by and between
The Boeing Company, a Delaware corporation, with its principal office in
Seattle, Washington (Boeing), and
Southwest Airlines Co., a Texas corporation,
with its principal office in the City of Dallas, State of Texas (Buyer).
Accordingly, Boeing and Buyer agree as follows:
1
P.A. No. 1810
K/SWA
ARTICLE 1. Subject Matter of Sale.
1.1 The Aircraft. Subject to the terms and conditions of this
Agreement, Boeing will manufacture and deliver to Buyer and Buyer will purchase
and accept delivery from Boeing of one hundred forty-two (142) Boeing Model
737-7H4 aircraft (the Aircraft) manufactured in accordance with Boeing Detail
Specification D6-38808-1, dated October 30, 1996, as described in Exhibit A, and
ninety-four (94) Boeing Model 737-7H4 (the Aircraft) manufactured in accordance
with Boeing Detail Specification D6-38808-1, Revision A, dated February 24, 1998
as described in Exhibit A-1, as modified from time to time in accordance with
this Agreement (Detail Specification).
1.2 Additional Goods and Services. In connection with the sale of the
Aircraft, Boeing will also provide to Buyer certain other things under this
Agreement, including data, documents, training and services, all as described in
this Agreement.
1.3 Performance Guarantees. Any performance guarantees applicable to
the Aircraft will be expressly included in this Agreement. Where performance
guarantees are included in this Agreement other than within the Detail
Specification, such guarantees will be treated as being incorporated in the
Detail Specification by this reference.
1.4 Defined Terms. For ease of use, certain terms are treated as
defined terms in this Agreement. Such terms are identified with a capital letter
and set forth and/or defined in Exhibit F.
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ARTICLE 2. Delivery, Title and Risk of Loss.
2.1 Time of Delivery. The Aircraft will be delivered to Buyer by
Boeing, assembled and ready for flight and Buyer will accept delivery of the
Aircraft, in accordance with the following schedule:
Month and Year
of Delivery Quantity of Aircraft
----------- --------------------
Block A Aircraft
October 1997 Two (2)
November 1997 Two (2)
Block B Aircraft
January 1998 Two (2)
February 1998 Three (3)
March 1998 Two (2)
April 1998 Two (2)
May 1998 Two (2)
June 1998 One (1)
July 1998 Two (2)
September 1998 Two (2)
Block C Aircraft
February 1999 Four (4)
May 1999 Four (4)
July 1999 Four (4)
August 1999 One (1)
September 1999 Three (3)
Block D Aircraft
November 1999 Two (2)
December 1999 One (1)
January 0000 Xxx (1)
March 2000 Four (4)
July 2000 Four (4)
August 2000 Three (3)
Block E Aircraft
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Three (3)
September 2001 Three (3)
2-1
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Block F Aircraft
October 1998 One (1)
November 1998 Two (2)
December 1998 Two (2)
Block G Aircraft
March 1999 Two (2)
Block H Aircraft
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
October 2001 Three (3)
Block I Aircraft
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
April 2002 Two (2)
July 2002 Four (4)
October 2002 Four (4)
Block J Aircraft
January 2003 Four (4)
March 2003 One (1)
Block K Aircraft
April 2004 Two (2)
July 2004 Three (3)
Block L Aircraft
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
October 0000 Xxx (1)
2-2
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K/SWA SA-16
November 2000 Four (4)
December 0000 Xxx(1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
September 2001 One (1)
October 2001 One (1)
September 2002 Three (3)
Block T Aircraft
November 2001 One (1)
February 2002 One (1)
May 2002 One (1)
June 2002 Two (2)
July 2002 One (1)
August 2002 Two (2)
November 2002 Two (2)
February 2003 One (1)
May 2003 Two (2)
June 2003 Two (2)
August 2003 Three (3)
February 2004 Three (3)
March 2004 Three (3)
April 2004 One (1)
May 2004 Four (4)
June 2004 Three (3)
July 2004 Two (2)
August 2004 Two (2)
September 2004 Two (2)
October 2004 Two (2)
November 2004 Two (2)
February 2005 One (1)
May 2005 One (1)
June 2005 One (1)
August 2005 One (1)
September 2005 One (1)
February 2006 Three (3)
March 2006 One (1)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
July 2007 Two (2)
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K/SWA SA-16
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
2.2 Notice of Target Delivery Date. Boeing will give Buyer notice of
the Target Delivery Date of the Aircraft approximately 30 days prior to the
scheduled month of delivery.
2.3 Notice of Delivery Date. If Boeing gives Buyer at least 7 days'
notice of the delivery date of the Aircraft, and an Aircraft delivery is delayed
beyond such delivery date due to the responsibility of Buyer, Buyer will
reimburse Boeing for all costs incurred by Boeing as a result of such delay,
including amounts for storage, insurance, Taxes, preservation or protection of
the Aircraft and interest on payments due.
2.4 Place of Delivery. The Aircraft will be delivered at an airport
facility selected by Boeing in the State of Washington, unless mutually agreed
otherwise.
2.5 Title and Risk of Loss. Title to and risk of loss of an Aircraft
will pass from Boeing to Buyer upon delivery of such Aircraft, but not prior
thereto.
2.6 Xxxx of Sale. Upon delivery of an Aircraft Boeing will deliver to
Buyer a xxxx of sale conveying good title to such Aircraft, free of all liens,
claims, charges and encumbrances of every kind whatsoever, and such other
appropriate documents of title as Buyer may reasonably request.
2-4
P.A. No. 1810
K/SWA SA-16
ARTICLE 3. Price of Aircraft.
3.1 Definitions.
3.1.1 Special Features are the features incorporated in
Exhibit A which have been selected by Buyer.
3.1.2 Base Aircraft Price is the Aircraft Basic Price
excluding the price of Special Features.
3.1.3 Aircraft Basic Price is comprised of the Base Aircraft
Price and the price of the Special Features.
3.1.4 Economic Price Adjustment is the adjustment to the
Aircraft Basic Price (Base Aircraft and Special Features) as calculated pursuant
to Exhibit D or Exhibit D-1 as applicable.
3.1.5 Aircraft Price is the total amount Buyer is to pay for
the Aircraft at the time of delivery.
3.2 Aircraft Basic Price.
The Aircraft Basic Price for Block A through L Aircraft, is
expressed in July 1992 dollars; the Aircraft Basic Price for Block T Aircraft,
is expressed in July 1999 dollars; as set forth below:
Base Special Aircraft
Aircraft Price Features Basic Price
Block A, B, C,
D & E Aircraft *** *** ***
Block F & G
Aircraft *** *** ***
Block H
Aircraft *** *** ***
Block I
Aircraft *** *** ***
Block J
Aircraft *** *** ***
Block K
Aircraft *** *** ***
Block L
Aircraft *** *** ***
Block T
Aircraft *** *** ***
15-1
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K/SWA
3.3 Aircraft Price. The Aircraft Price will be established at the time
of delivery of such Aircraft to Buyer and will be the sum of:
3.3.1 the Aircraft Basic Price, which is *** for the Block A,
B, C, D and E Aircraft, *** for the Block F and G Aircraft, *** for the Block H
Aircraft, *** for the Block I Aircraft, *** for the Block J Aircraft, *** for
the Block K Aircraft and *** for the Block L Aircraft; *** for the Block T
Aircraft; plus
3.3.2 the Economic Price Adjustments for the Aircraft Basic
Price, as calculated pursuant to the formulas set forth in Exhibit D (Price
Adjustments Due to Economic Fluctuations - Aircraft) for Aircraft Block A
through L, and in Exhibit D-1 (Price Adjustments Due to Economic Fluctuations -
Aircraft) for Aircraft Block T; plus
3.3.3 other price adjustments made pursuant to this Agreement
or other written agreements executed by Boeing and Buyer.
3.4 Advance Payment Base Price.
3.4.1 Advance Payment Base Price. For advance payment
purposes, the following estimated delivery prices of the Aircraft (Advance
Payment Base Price) have been established, using currently available forecasts
of the escalation factors used by Boeing as of the date of signing this
Agreement. The Advance Payment Base Price of each Aircraft is set forth below:
Month and Year of Advance Payment Base
Scheduled Delivery Price per Aircraft
------------------ --------------------
Block A Aircraft***
October 1997
November 1997
Block B Aircraft***
January 1998
February 1998
March 1998
April 1998
May 1998
June 1998
July 1998
September 1998
00-0
X.X. Xx. 0000
X/XXX
Xxxxx C Aircraft***
February 1999
May 1999
July 1999
August 1999
September 1999
Block D Aircraft***
November 1999
December 1999
January 2000
March 2000
July 2000
August 2000
Block E Aircraft***
December 2000
January 2001
February 2001
March 2001
June 2001
September 2001
Block F Aircraft***
October 1998
November 1998
December 1998
Block G Aircraft***
March 1999
Block H Aircraft***
June 1999
July 1999
August 1999
September 1999
October 1999
March 2000
April 2000
September 2000
October 2000
March 2001
April 2001
October 2001
00-0
X.X. Xx. 0000
X/XXX
Xxxxx I Aircraft***
November 2001
December 2001
January 2002
March 2002
April 2002
July 2002
October 2002
Block J Aircraft***
January 2003
March 2003
Block K Aircraft***
April 2004
July 2004
Block L Aircraft***
October 1999
November 1999
December 1999
June 2000
July 2000
September 2000
October 2000
November 2000
December 2000
January 2001
February 2001
July 2001
September 2001
October 2001
September 2002
Block T Aircraft***
November 2001
February 2002
May 2002
June 2002
July 2002
August 2002
November 2002
February 2003
May 2003
June 2003
15-4
P.A. No. 1810
K/SWA
August 2003
February 2004
March 2004
April 2004
May 2004
June 2004
July 2004
August 2004
September 2004
October 2004
November 2004
February 2005
May 2005
June 2005
August 2005
September 2005
February 2006
March 2006
May 2006
June 2006
July 2006
August 2006
September 2006
November 2006
December 2006
January 2007
February 2007
March 2007
April 2007
May 2007
June 2007
July 2007
August 2007
September 2007
October 2007
November 2007
December 2007
3.4.2 Adjustment of Advance Payment Base Prices - Long-Lead
Aircraft. For Aircraft scheduled for delivery 36 months or more after the date
of this Agreement, the Advance Payment Base Prices appearing in Article 3.4.1
will be used to determine the amount of the first advance payment to be made by
Buyer on the Aircraft. No later than 25 months before the scheduled month of
delivery of each affected Aircraft, Boeing will increase or decrease the Advance
Payment Base Price of such Aircraft as required to reflect the effects of (i)
any adjustments in the Aircraft Basic Price pursuant to this Agreement and (ii)
the then-current forecasted escalation factors used by Boeing. Boeing will
provide the adjusted Advance Payment Base Prices for each affected Aircraft to
Buyer, and the advance payment schedule will be considered amended to substitute
such adjusted Advance Payment Base Prices.
15-5
P.A. No. 1810
K/SWA
Supplemental Agreement No. 17
to
Purchase Agreement No. 1810
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 737-7H4 Aircraft
THIS
SUPPLEMENTAL AGREEMENT, entered into as of AUGUST 21, 2001, by and
between THE BOEING COMPANY, a Delaware corporation with its principal offices in
Seattle, Washington, (Boeing) and SOUTHWEST AIRLINES CO., a Texas corporation
with its principal offices in Dallas, Texas (Buyer);
WHEREAS, the parties hereto entered into Purchase Agreement No. 1810
dated January 19, 1994, relating to Boeing Model 737-7H4 aircraft (the
Agreement) and;
WHEREAS, Buyer has agreed to delete three (3) Block P Option Aircraft
from October 2006, and add three (3) Block N Option Aircraft one (1) February
2004, one (1) May 2004 and one (1) June 2004.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree to amend the Agreement as follows:
1. The Table of Contents of the Agreement is deleted in its entirety and a new
Table of Contents is attached hereto and incorporated into the Agreement by this
reference.
*** PURSUANT TO 17 CFR 240.24b-2, CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE COMMISSION.
SA-17-1
P.A. No. 1810
K/SWA
2. Letter Agreement No. 6-1162-RLL-933R9 entitled "Option Aircraft," is deleted
in its entirety and replaced by a new Letter Agreement No. 6-1162-RLL-933R10
which is attached hereto and is incorporated into the Agreement by this
reference.
The Agreement will be deemed to be supplemented to the extent herein provided
and as so supplemented will continue in full force and effect.
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY SOUTHWEST AIRLINES CO.
By: /s/ XXXXXXX X. XXXXXXXX By: /s/ XXXXX XXXXXX
-------------------------- --------------------------
Its: Attorney-In-Fact Its: V.P. Finance & Treasurer
------------------------- ------------------------
SA-17-2
P.A. No. 1810
K/SWA
TABLE OF CONTENTS
Page SA
Number Number
------ ------
ARTICLES
--------
1. Subject Matter of Sale..........................................1-1 SA-13
2. Delivery, Title and Risk
of Loss.........................................................2-1 SA-16
3. Price of Aircraft...............................................3-1 SA-16
4. Taxes...........................................................4-1
5. Payment.........................................................5-1
6. Excusable Delay.................................................6-1
7. Changes to the Detail
Specification...................................................7-1 SA-1
8. Federal Aviation Requirements and
Certificates and Export License.................................8-1
9. Representatives, Inspection,
Flights and Test Data...........................................9-1
10. Assignment, Resale or Lease....................................10-1
11. Termination for Certain Events.................................11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance..................................................12-1
13. Buyer Furnished Equipment and
Spare Parts....................................................13-1
14. Contractual Notices and Requests...............................14-1
15. Miscellaneous..................................................15-1
i
P.A. No. 1810 SA-17
K/SWA
TABLE OF CONTENTS
SA
Number
------
EXHIBITS
--------
A Aircraft Configuration SA-13
B Product Assurance Document SA-1
C Customer Support Document
D Price Adjustments Due to
Economic Fluctuations - Aircraft SA-13
E Buyer Furnished Equipment
Provisions Document
F Defined Terms Document
LETTER AGREEMENTS
-----------------
1810-1 Waiver of Aircraft Demonstration Flight
ii
P.A. No. 1810 SA-17
K/SWA
TABLE OF CONTENTS
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-932R2 Promotional Support SA-13
6-1162-RLL-933R10 Option Aircraft SA-17
6-1162-RLL-934R3 Disclosure of Confidential SA-14
Information
6-1162-RLL-935R1 Performance Guarantees XX-0
0-0000-XXX-000X0 Xxxxxxx Contractual Matters XX-0
0-0000-XXX-000 Xxxxxxxxx Advance Payment Schedule
6-1162-RLL-938 ***
6-1162-RLL-939R1 Certification Flight Test Aircraft SA-1
6-1162-RLL-940R1 Training Matters SA-1
6-1162-RLL-941R2 Other Matters SA-13
6-1162-RLL-942 Open Configuration Matters
6-1162-RLL-943R1 Substitution Rights XX-0
0-0000-XXX-000 Xxxxxxxx Maintenance Material Cost
Protection Program
6-1162-RLL-945 Comparison of 737-7H4 and 000-0X0
Xxxxx Xxxx Xxxx
0-0000-XXX-0000X0 Additional Contractual Matters SA-4
6-1162-RLL-1856 *** SA-1
6-1162-RLL-1857 Service Ready Validation Program SA-1
Field Test
6-1162-RLL-1858R1 Escalation Matters SA-4
iii
P.A. No. 1810 SA-17
K/SWA
TABLE OF CONTENTS CON'T
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-2036 Amortization of Costs for
Customer Unique Changes XX-0
0-0000-XXX-0000 Xxxxxxxxxxxxxx of the Aircraft SA-1
Basic Price
6-1162-RLL-2073 Maintenance Training Matters SA-1
6-1162-KJJ-054 Business Matters SA-13
6-1162-KJJ-055 Structural Matters SA-13
6-1162-KJJ-056 Noise and Emission Matters SA-13
6-1162-KJJ-057 Product Development Matters SA-13
6-1162-KJJ-058 Additional Substitution Rights SA-13
6-1162-KJJ-150 Flight Control Computer & Mode SA-14
Control Panel Spares Matter
iv
P.A. No. 1810 XX-00
X/XXX
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000X00 Page 1
6-1162-RLL-933R10
Southwest Airlines Co.
P.O. Box 36611 - Love Field
Xxxxxx, Xxxxx 00000
Subject: Letter Agreement No. 6-1162-RLL-933R10 to Purchase Agreement
No. 1810 - Option Aircraft
This Letter Agreement amends Purchase Agreement No. 1810 dated as of January 19,
1994 (the Agreement) between The Boeing Company (Boeing) and Southwest Airlines
Co. (Buyer) relating to Model 737-7H4 aircraft (Aircraft).
All terms used and not defined herein will have the same meaning as in the
Agreement.
In consideration of the purchase by Buyer of the Aircraft, Boeing hereby agrees
to manufacture and sell to Buyer and Buyer shall have the option to purchase
(Option or Options) eighty-seven (87) additional Model 737-7H4 aircraft as
described in paragraph 1 of Attachment A hereto (Option Aircraft) and two
hundred seventeen (217) Model 737-7H4 Rollover Option Aircraft (Rollover Option
Aircraft), subject to the terms and conditions set forth below.
1. Delivery of Option Aircraft.
The Option Aircraft will be delivered to Buyer during or before the
months set forth in the following schedule:
Number of Option
Month and Year Option Aircraft
of Delivery Aircraft Block
-------------- --------- --------
March 2003 Three (3) M
April 2003 Two (2) M
July 2003 Four (4) M
October 2003 Four (4) M
January 2004 Four (4) N
February 2004 One (1) N
March 2004 One (1) N
April 2004 One (1) N
May 2004 One (1) N
June 2004 One (1) N
August 2004 Two (2) N
September 2004 Three (3) N
October 2004 Two (2) N
P.A. No. 1810
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0-0000-XXX-000X00 Page 2
Number of Option
Month and Year Option Aircraft
of Delivery Aircraft Block
-------------- --------- --------
January 2005 Four (4) O
March 2005 Four (4) O
April 2005 Two (2) O
July 2005 Four (4) O
October 2005 Four (4) O
January 2006 Four (4) P
March 2006 Four (4) P
April 2006 Two (2) P
July 2006 Four (4) P
October 2006 One (1) P
January 2008 Two (2) U
February 2008 Three (3) U
March 2008 Two (2) U
April 2008 Two (2) U
May 2008 Two (2) U
June 2008 Two (2) U
July 2008 Two (2) U
August 2008 Two (2) U
September 2008 Two (2) U
October 2008 Two (2) U
November 2008 Two (2) U
December 2008 Two (2) U
2. Delivery of Rollover Option Aircraft.
2.1 The Rollover Option Aircraft will be delivered to Buyer during or
before the years set forth in the following schedule:
Option
Year of Number of Aircraft
Delivery Option Aircraft Block
-------- --------------- --------
2007 Twenty (20) Q
2008 Twenty (20) R
2009 Six (6) S
2009-2012 One hundred seventy one V
(171)
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0-0000-XXX-000X00 Page 3
2.2 The two hundred seventeen (217) Rollover Option Aircraft may be
converted into Option Aircraft or firm Aircraft, from time to time, in any of
the following ways:
2.2.1 Buyer can exercise any Option for an Option Aircraft
described in Article 1 above, and will be offered the right to convert one
Rollover Option Aircraft into an Option Aircraft for each Option exercised.
2.2.2 If Buyer elects not to exercise an Option, Buyer may
convert one Rollover Option Aircraft to an Option Aircraft; otherwise, one
Rollover Option Aircraft will be deleted for each Option not exercised by Buyer.
2.2.3 Buyer may convert Rollover Option Aircraft directly to
firm Aircraft. When Buyer converts one or more Rollover Option Aircraft to firm
Aircraft, Buyer will be offered the right to convert one Rollover Option
Aircraft into an Option Aircraft for each converted Rollover Option Aircraft.
2.3 Buyer may not convert Rollover Option Aircraft to Option Aircraft
except in accordance with Article 2.2 above.
2.4 Base Price Adjustments for Rollover Option Aircraft which are
converted to Option Aircraft or firm Aircraft shall be in accordance with
Article 2.2.5 of Attachment A to this Letter Agreement.
2.5 The delivery month offered by Boeing to Buyer for any Option or
firm Aircraft resulting from a conversion of a Rollover Option Aircraft will be
at least 24 months from the corresponding Option exercise date or firm order.
2.6 Upon conversion of a Rollover Option Aircraft into an Option
Aircraft, Buyer shall wire transfer the Deposit of *** to Boeing and Boeing and
Buyer shall agree on a delivery position for that aircraft. Section 1 of this
Letter Agreement will be amended accordingly. In the event Buyer thereafter
exercises its right to purchase such Option Aircraft, application of the Deposit
will be in accordance with Article 4.1 herein. If the conversion is a Rollover
Option Aircraft to a firm Aircraft, Buyer shall wire transfer any advance
payments due under the Agreement.
2.7 Buyer and Boeing will consult on a frequent basis to keep each
other informed as to
P.A. No. 1810
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Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000X00 Page 4
Buyer's fleet plans and Boeing's production plans in order to accommodate to the
greatest extent reasonably possible each party's needs in managing the delivery
schedule for the Rollover Option Aircraft. Boeing acknowledges Buyer's need for
delivery positions in the 2007-2012 time frame, as well as the possibility of a
need for delivery positions in earlier years and will use its best reasonable
efforts to meet Buyer's needs.
3. Price.
3.1 The advance payment base prices of the Option Aircraft set forth
below and in paragraph 2.1 of Attachment A represent the estimated delivery
prices of the Option Aircraft. The Option Aircraft pricing elements and
associated pricing terms and conditions are given in Attachment A.
3.2 Price and escalation provisions for Model 737-7H4 aircraft
delivering after 2004 are not currently available. The estimated Advance Payment
Base Prices shown in paragraph 3.3 below and in paragraph 2.1 of Attachment A
are based on currently available price and escalation provisions. As price and
escalation provisions become available for Model 737-7H4 aircraft delivering
after 2004, such price and escalation provisions will be appropriately applied
to the applicable Option Aircraft.
For additional information relating to price and escalation provisions
applicable to Option Aircraft delivering after 2004 refer to paragraphs 2.2 and
3.2 of Attachment A.
3.3 The Advance Payment Base Prices of the Option Aircraft indicated
below do include an amount for special features in addition to those
specifically described in Attachment A but do not include any amount for items
of Buyer Furnished Equipment (BFE). An estimate for typical special features is
*** per Aircraft (expressed in 1992 STE dollars) and for BFE is *** per Aircraft
(expressed in delivery year dollars).
Month and Year Advance Payment Base
of Delivery Price per Option Aircraft
-------------- -------------------------
Block M Aircraft***
March 2003
April 2003
July 2003
October 2003
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0-0000-XXX-000X00 Page 5
Block N Aircraft***
January 2004
February 2004
March 2004
April 2004
May 2004
June 2004
August 2004
September 2004
October 2004
Block O Aircraft***
January 2005
March 2005
April 2005
July 2005
October 2005
Block P Aircraft***
January 2006
March 2006
April 2006
July 2006
October 2006
Block U Aircraft***
January 2008
February 2008
March 2008
April 2008
May 2008
June 2008
July 2008
August 2008
September 2008
October 2008
November 2008
December 2008
3.4 The Option Aircraft purchase price will be the applicable basic
price thereof at the time of Option Aircraft delivery adjusted in accordance
with Boeing's Aircraft escalation provisions contained in the definitive
agreement to purchase the Option Aircraft. The purchase price will include the
price for Seller Purchased Equipment (SPE) if Buyer has
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Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000X00 Page 6
elected to change Buyer Furnished Equipment (BFE) to SPE.
4. Option Aircraft Payment.
4.1 In consideration of the granting of the Options as set forth
herein, on or before the date Boeing and Buyer enter into a definitive agreement
to purchase the Aircraft, Buyer will pay a deposit to Boeing of *** for each
Option Aircraft (Deposit). In the event Buyer exercises its Options herein, the
amount of the Deposit will be credited against the first advance payment due for
such Option Aircraft pursuant to the advance payment schedule set forth in
paragraph 3 of Attachment A. The Deposits for the Option Aircraft will be
refunded to Buyer, without interest, if the parties do not enter into a
definitive Agreement for the Aircraft.
In the event that, after the parties enter into a definitive agreement to
purchase the Aircraft, Buyer does not exercise its Options to purchase the
Option Aircraft pursuant to the terms and conditions set forth herein, Boeing
will be entitled to retain the Deposits for the Option Aircraft except as
provided in paragraph 6 herein.
4.2 Advance payments in the amount of 30% of the advance payment base
price will be payable on the Option Aircraft in accordance with paragraph 3 of
Attachment A. The remainder of the Option Aircraft purchase price is due at the
time of delivery of the Option Aircraft.
5. Option Exercise.
5.1 To exercise its Option, Buyer will give written or telegraphic
notice thereof to Boeing on or before sixteen (16) months prior to the first day
of the delivery month of each Option Aircraft.
In such notice Buyer will select the Option Model type, and the applicable
delivery positions.
5.2 It is understood and agreed that Boeing may accelerate the Option
exercise dates specified above if Boeing must make production decisions which
are dependent on Buyer's decision to buy the Option Aircraft. If Boeing elects
to accelerate the Option exercise dates, Boeing will do so by giving written or
telegraphic notice thereof to Buyer. Such notice will specify the revised Option
exercise dates, which will not be earlier than 30 days after the date of
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0-0000-XXX-000X00 Page 7
transmittal of such notice, and the Option Aircraft delivery positions affected
by such revision. If Buyer fails to exercise its Option for any Option Aircraft
affected by such revised dates, the Deposit applicable to such Option Aircraft
will be promptly refunded, with interest, to Buyer. The interest rate for
calculation of the interest associated with such refund is the rate of two
percent (2%) below the Citibank base rate in effect from time to time during the
period the Option deposit is held by Boeing.
6. Contract Terms.
It is understood that Boeing and Buyer will use their best efforts to
enter into a definitive agreement for the Option Aircraft within thirty (30)
days after Buyer exercises an Option to purchase Option Aircraft pursuant to
paragraph 5 covering the detailed terms and conditions for the sale of such
Option Aircraft.
Such definitive agreement will include the terms and conditions contained herein
together with the terms and conditions, not inconsistent herewith, contained in
Boeing's then-current standard form of purchase agreement for the sale of Model
737-700 aircraft in effect as of the date of Option exercise and such additional
terms and conditions as may be mutually agreed upon. In the event the parties
have not entered into such an agreement within the time period contemplated
herein, either party may, exercisable by written or telegraphic notice given to
the other within thirty (30) days after such period, terminate the purchase of
such Option Aircraft.
7. Termination of Option to Purchase.
Either Boeing or Buyer may terminate the Options to purchase an Option
Aircraft if any of the following events are not accomplished by the respective
dates contemplated in this letter agreement, or in the Agreement, as the case
may be:
(i) termination of the purchase of the Aircraft under the Agreement for
any reason;
(ii) payment by Buyer of the Deposit with respect to an Option Aircraft
pursuant to paragraph 4.1 herein;
(iii) exercise of an Option to purchase an Option Aircraft pursuant to
the terms hereof.
Any termination of an Option to purchase by Boeing which is based on the
termination of the purchase of
P.A. No. 1810
K/SWA XX-00
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000X00 Page 8
Aircraft under the Agreement will be on a one-for-one basis, for each Aircraft
so terminated.
Any cancellation of an Option to purchase which is based on failure to make the
required Deposit or to exercise the Option to purchase shall only apply to the
Option Aircraft so canceled.
Termination of an Option to purchase provided by this letter agreement will be
caused by either party giving written notice to the other within 10 days after
the applicable date. Upon receipt of such notice, all rights and obligations of
the parties with respect to an Option Aircraft for which the Option to purchase
has been terminate will thereupon terminate.
If termination is result of a revision of an Option exercise date by Boeing
pursuant to paragraph 5.2, Boeing will promptly refund to Buyer, with interest,
any payments received from Buyer, including the Deposit, with respect to the
Option Aircraft for which the Option is terminated. If termination is for any
other reason, Boeing will promptly refund to Buyer, without interest, any
payments received from Buyer with respect to the affected Option Aircraft,
except the Deposit, which Buyer may apply to any model Boeing aircraft purchased
by Buyer from Boeing at a future date.
8. Confidential Treatment. Buyer understands that certain commercial and
financial information contained in this Letter Agreement including any
attachments hereto is considered by Boeing as confidential. Buyer
agrees that it will treat this Letter Agreement and the
P.A. No. 1810
K/SWA XX-00
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000X00 Page 9
9. information contained herein as confidential and will not, without the
prior written consent of Boeing, disclose this Letter Agreement or any
information contained herein to any other person or entity except as
provided in Letter Agreement No. 6-1162-RLL-934, as amended.
Very truly yours,
THE BOEING COMPANY
By /s/ XXXXXXX X. XXXXXXXX
------------------------------------
Its ATTORNEY-IN-FACT
-----------------------------------
ACCEPTED AND AGREED TO this
date: AUGUST 21, 2001
---------------------------------
SOUTHWEST AIRLINES CO.
By /s/ XXXXX XXXXXX
------------------------------------
Its V.P. - FINANCE & TREASURER
-----------------------------------
Attachments
P.A. No. 1810
K/SWA SA-17
Attachment A to
6-1162-RLL-933R10
Page 1
Model 737-7H4 Aircraft
1. Option Aircraft Description and Changes.
1.1 Aircraft Description. The Option Aircraft is described by Boeing
Detail Specification D6-38808-1, Dated October 30 ,1996 and for Block U Option
Aircraft by Boeing Detail Specification D6-38808-1, Rev. A, Dated February 24,
1998.
1.2 Changes. The Detail Specification will be revised to include:
(1) Changes applicable to the basic Model 737-700 aircraft
which are developed by Boeing between the date of the Detail Specification and
the signing of a definitive agreement to purchase the Option Aircraft.
(2) Changes mutually agreed upon.
(3) Changes required to obtain a Standard Certificate of
Airworthiness.
(4) To provide sufficient Option Aircraft manufacturing and
procurement lead time it is necessary for Boeing and Buyer to reach final
agreement on the Option Aircraft configuration, including BFE/SPE vendor
selection fifteen (15) months prior to delivery of each Option Aircraft. If such
items are not resolved by the indicated dates, Boeing reserves the right to
amend this letter agreement:
(i) to adjust the scheduled delivery of the Option
Aircraft to a later time period and,
(ii) to make such other changes as are appropriate
and consistent with the revised Option Aircraft deliveries.
1.3 Effect of Changes. Changes to the Detail Specification incorporated
pursuant to the provisions of the clauses above will include the effects of such
changes upon Option Aircraft weight, balance, design and performance.
Performance guarantees for the Option Aircraft which are mutually acceptable to
the parties will be included in the definitive agreement for the Option
Aircraft.
P.A. No. 1810
K/SWA SA-17
Attachment A to
6-1162-RLL-933R10
Page 2
2. Price Description
2.1 Price Elements Per Aircraft
1 2 3
----------------- ---------- ----------
AIRCRAFT & ADV. PMT.
AIRCRAFT ESTIMATED SPECIAL ESTIMATED BASE PRICE
DELIVERY FEATURES PRICE ESTIMATED ESCALATION (ELEMENTS)
MO. & YR. (JULY 1992$) ESCALATION SHARING 1 + 2 + 3
--------- ----------------- ---------- ---------- ----------
BLOCK M
MARCH 2003 *** *** *** ***
APRIL 2003 *** *** *** ***
JULY 2003 *** *** *** ***
OCTOBER 2003 *** *** *** ***
BLOCK N
JANUARY 2004 *** *** *** ***
FEBRUARY 2004 *** *** *** ***
MARCH 2004 *** *** *** ***
APRIL 2004 *** *** *** ***
MAY 2004 *** *** *** ***
JUNE 2004 *** *** *** ***
AUGUST 2004 *** *** *** ***
SEPTEMBER 2004 *** *** *** ***
OCTOBER 2004 *** *** *** ***
BLOCK O
JANUARY 2005 *** *** *** ***
MARCH 2005 *** *** *** ***
APRIL 2005 *** *** *** ***
JULY 2005 *** *** *** ***
OCTOBER 2005 *** *** *** ***
BLOCK P
JANUARY 2006 *** *** *** ***
MARCH 2006 *** *** *** ***
APRIL 2006 *** *** *** ***
JULY 2006 *** *** *** ***
OCTOBER 2006 *** *** *** ***
P.A. No. 1810
K/SWA SA-17
Attachment A to
6-1162-RLL-933R10
Page 3
AIRCRAFT &
ADV. PMT.
AIRCRAFT ESTIMATED SPECIAL ESTIMATED BASE PRICE
DELIVERY FEATURES PRICE ESTIMATED ESCALATION (ELEMENTS)
MO. & YR. (JULY 1999$) ESCALATION SHARING 1 + 2 + 3
--------- ----------------- ---------- ---------- ----------
BLOCK U
JANUARY 2008 *** *** *** ***
FEBRUARY 2008 *** *** *** ***
MARCH 2008 *** *** *** ***
APRIL 2008 *** *** *** ***
MAY 2008 *** *** *** ***
JUNE 2008 *** *** *** ***
JULY 2008 *** *** *** ***
AUGUST 2008 *** *** *** ***
SEPTEMBER 2008 *** *** *** ***
OCTOBER 2008 *** *** *** ***
NOVEMBER 2008 *** *** *** ***
DECEMBER 2008 *** *** *** ***
2. Price Description. (Continued)
2.2 Price Adjustments For Option Aircraft Delivering From January 2005
through December 2012.
2.2.1 Special Features. The price for Special Features
incorporated in the Option Aircraft Detail Specification will be adjusted to
Boeing's then-current prices for such features as of the date of execution of
the definitive agreement for the Option Aircraft.
2.2.2 Escalation Adjustments. For escalation provisions
applicable to Option Aircraft delivering after 2004, see paragraph 2.2.6 below.
2.2.3 Base Price Adjustments for FAA Changes. The Aircraft
Basic Price of the Option Aircraft will be adjusted for any FAA mandated changes
incorporated into the Aircraft.
2.2.4 Price Adjustments for Changes. Boeing may adjust the
Aircraft Basic Price and the Advance Payment Base Price for any changes mutually
agreed upon subsequent to the date that Buyer and Boeing enter into a definitive
agreement for the Option Aircraft.
2.2.5 Base Price Adjustments. The Aircraft Basic Price of the
Option Aircraft will be adjusted to Boeing's then-current prices as of the date
of execution of the definitive agreement for the Option Aircraft in
P.A. No. 1810
K/SWA SA-17
Attachment A to
6-1162-RLL-933R10
Page 4
accordance with the agreement reached below. The Aircraft Basic Price starting
point for Option Aircraft delivering in 2003 is *** (July 1992 STE), for Option
Aircraft delivering in 2004 is *** (July 1992 STE), for Options delivering in
2005 through 2009 is *** (July 1992 STE) and for Block U Option Aircraft is ***
(July 1999 STE). Such Aircraft Basic Price may increase in accordance with
paragraphs 2.2.1, 2.2.2, 2.2.3 and 2.2.4. For any other changes to the Aircraft
Basic Price, Boeing may increase the Aircraft Basic Price by a maximum of ***
(July 1992 STE) for Aircraft delivering in 2005; by a maximum of *** (July 1992
STE) per year or portion thereof starting in January 2006 through 2009. For
Block U Option Aircraft Boeing may increase the Aircraft Basic Price by a
maximum of *** (July 1999 STE) per year or portion thereof starting in January
2008.
2.2.6 Prices for Long Lead Time Aircraft. Boeing has not
established escalation provisions for Model 737-700 aircraft for delivery 2005
and after. Such escalation provisions (i) will be incorporated into the Option
Aircraft definitive agreement when such information is available and (ii) will
be the then-current escalation provisions applicable to the same model aircraft
and engines delivering in the same time period as the Option Aircraft. The
resulting revisions to the definitive agreement will include but not be limited
to, adjustment of the Aircraft Basic Price of the Option Aircraft, the Advance
Payment Base Price, the Aircraft escalation provisions and the advance payment
amounts due on the Option Aircraft.
2.2.7 BFE to SPE. An estimate of the total price for items of
Buyer Furnished Equipment (BFE) changed to Seller Purchased Equipment (SPE)
pursuant to the Configuration Specification is included in the Option Aircraft
price build-up. The purchase price of the Option Aircraft will be adjusted by
the price charged to Boeing for such items plus 10% of such price. If all BFE
except developmental avionics is converted to SPE, Boeing will waive the 10%
fee.
3. Advance Payment Schedules, Prices and Adjustments.
3.1 Buyer will pay to Boeing advance payments for the Option Aircraft
on the dates and in the amounts determined below.
P.A. No. 1810
K/SWA SA-17
Attachment A to
6-1162-RLL-933R10
Page 5
Amount Due per Aircraft
(Percentage times
Due Date of Payment Advance Payment Base Price)
------------------- ---------------------------
Deposit ***(if
applicable)
18 months prior to the first 15% (less the
day of the scheduled delivery Deposit if any)
month of the Aircraft
12 months prior to the first 5%
day of the scheduled delivery
month of the Aircraft
9 months prior to the first 5%
day of the scheduled delivery
month of the Aircraft
6 months prior to the first 5%
day of the scheduled delivery
month of the Aircraft
---
Total 30%
Any advance payments that would be past due as of the date of signing the
definitive purchase agreement for the Option Aircraft in accordance with the
above schedule are due and payable on such date.
3.2 Option Aircraft advance payment base prices will be increased or
decreased, as appropriate, at the time of signing of the definitive purchase
agreement for the Option Aircraft, using the then-current forecasted aircraft
escalation factors used by Boeing, to determine the amount of the advance
payments to be made by Buyer on the Option Aircraft.
P.A. No. 1810
K/SWA SA-17
Supplemental Agreement No. 18
to
Purchase Agreement No. 1810
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 737-7H4 Aircraft
THIS
SUPPLEMENTAL AGREEMENT, entered into as of OCTOBER 17, 2001, by
and between THE BOEING COMPANY, a Delaware corporation with its principal
offices in Seattle, Washington, (Boeing) and SOUTHWEST AIRLINES CO., a Texas
corporation with its principal offices in Dallas, Texas (Buyer);
WHEREAS, the parties hereto entered into Purchase Agreement No. 1810
dated January 19, 1994, relating to Boeing Model 737-7H4 aircraft (the
Agreement) and;
WHEREAS, Buyer has agreed to decelerate delivery dates of Aircraft as
follows:
*** PURSUANT TO 17 CFR 240.24b-2, CONFIDENTIAL INFORMATION HAS BEEN
OMITTED AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE
COMMISSION.
SA-18-1
P.A. No. 1810
K/SWA
Block E Aircraft
WAS
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Three (3)
September 2001 Three (3)
NEW
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Three (3)
September 2001 One (1)
November 2001 Two (2)
Block H Aircraft
WAS
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
October 2001 Three (3)
NEW
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
November 2001 Three (3)
Block I Aircraft
WAS
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
April 2002 Two (2)
July 2002 Four (4)
October 2002 Four (4)
SA-18-2
P.A. No. 1810
K/SWA
NEW
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
April 2002 Two (2)
May 2003 One (1)
June 2003 Two (2)
July 2003 One (1)
September 2003 Two (2)
October 2003 Two (2)
Block J Aircraft
WAS
January 2003 Four (4)
March 2003 One (1)
NEW
November 2003 Two (2)
February 2004 Two (2)
March 2004 One (1)
Block K Aircraft
WAS
April 2004 Two (2)
July 2004 Three (3)
NEW
March 2004 One (1)
April 2004 Three (3)
May 2004 One (1)
Block L Aircraft
WAS
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
October 0000 Xxx (1)
November 2000 Four (4)
December 0000 Xxx (1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
September 2001 One (1)
October 2001 One (1)
September 2002 Three (3)
NEW
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
SA-18-3
P.A. No. 1810
K/SWA
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
October 0000 Xxx (1)
November 2000 Four (4)
December 0000 Xxx (1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
November 2001 Two (2)
July 2003 One (1)
August 2003 Two (2)
Block T Aircraft
WAS
November 2001 One (1)
February 2002 One (1)
May 2002 One (1)
June 2002 Two (2)
July 2002 One (1)
August 2002 Two (2)
November 2002 Two (2)
February 2003 One (1)
May 2003 Two (2)
June 2003 Two (2)
August 2003 Three (3)
February 2004 Three (3)
March 2004 Three (3)
April 2004 One (1)
May 2004 Four (4)
June 2004 Three (3)
July 2004 Two (2)
August 2004 Two (2)
September 2004 Two (2)
October 2004 Two (2)
November 2004 Two (2)
February 2005 One (1)
May 2005 One (1)
June 2005 One (1)
August 2005 One (1)
September 2005 One (1)
February 2006 Three (3)
March 2006 One (1)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
SA-18-4
P.A. No. 1810
K/SWA
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
July 2007 Two (2)
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
NEW
November 2001 One (1)
February 2002 One (1)
May 2004 One (1)
June 2004 Four (4)
July 2004 Four (4)
August 2004 Two (2)
September 2004 Two (2)
November 2004 One (1)
December 2004 One (1)
January 2005 Five (5)
February 2005 Two (2)
March 2005 One (1)
April 2005 Two (2)
May 2005 One (1)
June 2005 Three (3)
July 2005 Two (2)
August 2005 One (1)
September 2005 Two (2)
October 2005 One (1)
November 2005 Two (2)
December 2005 Two (2)
February 2006 Four (4)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
July 2007 Two (2)
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
January 2008 One (1)
February 2008 One (1)
SA-18-5
P.A. No. 1810
K/SWA
March 2008 One (1)
April 2008 One (1)
May 2008 One (1)
June 2008 One (1)
***
WHEREAS, Buyer has agreed to decelerate delivery dates of Option
Aircraft as follows:
Block M Option Aircraft
WAS
March 2003 Three (3)
April 2003 Two (2)
July 2003 Four (4)
October 2003 Four (4)
NEW
March 2004 Three (3)
April 2004 Two (2)
June 2004 Two (2)
July 2004 Two (2)
October 2004 Four (4)
Block N Option Aircraft
WAS
January 2004 Four (4)
February 2004 One (1)
March 2004 One (1)
April 2004 One (1)
May 2004 One (1)
June 2004 One (1)
August 2004 Two (2)
September 2004 Three (3)
October 2004 Two (2)
NEW
February 2005 One (1)
March 2005 Four (4)
April 2005 Two (2)
May 2005 One (1)
June 2005 One (1)
July 2005 Two (2)
August 2005 Two (2)
September 2005 Three (3)
October 2005 Two (2)
November 2005 One (1)
December 2005 One (1)
Block O Option Aircraft
WAS
January 2005 Four (4)
March 2005 Four (4)
April 2005 Two (2)
July 2005 Four (4)
October 2005 Four (4)
SA-18-6
P.A. No. 1810
K/SWA
NEW
January 2006 Two (2)
March 2006 Four (4)
April 2006 Two (2)
May 2006 Two (2)
June 2006 Two (2)
July 2006 Two (2)
August 2006 Two (2)
October 2006 One (1)
November 2006 Two (2)
December 2006 One (1)
Block P Option Aircraft
WAS
January 2006 Four (4)
March 2006 Four (4)
April 2006 Two (2)
July 2006 Four (4)
October 2006 One (1)
NEW
April 2007 One (1)
May 2007 One (1)
June 2007 One (1)
July 2007 One (1)
August 2007 One (1)
September 2007 One (1)
October 2007 One (1)
November 2007 One (1)
December 2007 One (1)
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree to amend the Agreement as follows:
1. The Table of Contents of the Agreement is deleted in its entirety and a new
Table of Contents is attached hereto and incorporated into the Agreement by this
reference.
2. Article 2, entitled "Delivery, Title and Risk of Loss," is deleted in its
entirety and replaced by a new Article 2. Such new pages 2-1, 2-2, 2-3 and 2-4
are attached hereto and incorporated into the Agreement by this reference.
3. Article 3, entitled "Price of Aircraft", is deleted in its entirety and
replaced by a new Article 3. Such new pages 3-1, 3-2, 3-3, 3-4, 3-5 and 3-6 are
attached hereto and incorporated into the Agreement by this reference.
SA-18-7
P.A. No. 1810
K/SWA
4. Boeing shall retain Advance Payments made by Buyer to Boeing without interest
compensation by Boeing to Buyer. These retained Advance Payments shall be
applied to Buyer's future Advance Payment requirements, such that no Advance
Payments will be due from Buyer for any Aircraft to the extent the aggregate
Advance Payments held by Boeing exceed the aggregate Advance Payments required
for all Aircraft as required by Article 5.
5. Buyer shall ensure that Buyer's suppliers of BFE meet delivery requirements
to support the Aircraft delivery schedule of this Supplemental Agreement.
6. Letter Agreement No. 6-1162-MSA-185 entitled "Delivery Change Contractual
Matters," is attached hereto and is hereby incorporated into the Agreement by
this reference.
7. Letter Agreement No. 6-1162-RLL-933R10 entitled "Option Aircraft," is deleted
in its entirety and replaced by a new Letter Agreement No. 6-1162-RLL-933R11
which is attached hereto and is incorporated into the Agreement by this
reference.
The Agreement will be deemed to be supplemented to the extent herein provided
and as so supplemented will continue in full force and effect.
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY SOUTHWEST AIRLINES CO.
By: /s/ XXXXXXX X. XXXXXXXX By: /s/ XXXXX XXXXXX
-------------------------- -------------------------
Its: Attorney-In-Fact Its: VP Finance & Treasurer
------------------------- ------------------------
SA-18-8
P.A. No. 1810
K/SWA
TABLE OF CONTENTS
Page SA
Number Number
------ ------
ARTICLES
--------
1. Subject Matter of Sale..........................................1-1 SA-13
2. Delivery, Title and Risk
of Loss.........................................................2-1 SA-18
3. Price of Aircraft...............................................3-1 SA-18
4. Taxes...........................................................4-1
5. Payment.........................................................5-1
6. Excusable Delay.................................................6-1
7. Changes to the Detail
Specification...................................................7-1 SA-1
8. Federal Aviation Requirements and
Certificates and Export License.................................8-1
9. Representatives, Inspection,
Flights and Test Data...........................................9-1
10. Assignment, Resale or Lease....................................10-1
11. Termination for Certain Events.................................11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance..................................................12-1
13. Buyer Furnished Equipment and
Spare Parts....................................................13-1
14. Contractual Notices and Requests...............................14-1
15. Miscellaneous..................................................15-1
i
P.A. No. 1810
K/SWA SA-18
TABLE OF CONTENTS
SA
Number
------
EXHIBITS
--------
A Aircraft Configuration SA-13
B Product Assurance Document SA-1
C Customer Support Document
D Price Adjustments Due to
Economic Fluctuations - Aircraft SA-13
E Buyer Furnished Equipment
Provisions Document
F Defined Terms Document
LETTER AGREEMENTS
-----------------
1810-1 Waiver of Aircraft Demonstration Flight
ii
P.A. No. 1810
K/SWA SA-18
TABLE OF CONTENTS
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-932R2 Promotional Support SA-13
6-1162-RLL-933R11 Option Aircraft SA-18
6-1162-RLL-934R3 Disclosure of Confidential SA-14
Information
6-1162-RLL-935R1 Performance Guarantees XX-0
0-0000-XXX-000X0 Xxxxxxx Contractual Matters XX-0
0-0000-XXX-000 Xxxxxxxxx Advance Payment Schedule
6-1162-RLL-938 ***
6-1162-RLL-939R1 Certification Flight Test Aircraft SA-1
6-1162-RLL-940R1 Training Matters SA-1
6-1162-RLL-941R2 Other Matters SA-13
6-1162-RLL-942 Open Configuration Matters
6-1162-RLL-943R1 Substitution Rights XX-0
0-0000-XXX-000 Xxxxxxxx Maintenance Material Cost
Protection Program
6-1162-RLL-945 Comparison of 737-7H4 and 000-0X0
Xxxxx Xxxx Xxxx
0-0000-XXX-0000X0 Additional Contractual Matters SA-4
6-1162-RLL-1856 *** SA-1
6-1162-RLL-1857 Service Ready Validation Program SA-1
Field Test
6-1162-RLL-1858R1 Escalation Matters SA-4
iii
P.A. No. 1810
K/SWA SA-18
TABLE OF CONTENTS CON'T
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-2036 Amortization of Costs for
Customer Unique Changes XX-0
0-0000-XXX-0000 Xxxxxxxxxxxxxx of the Aircraft SA-1
Basic Price
6-1162-RLL-2073 Maintenance Training Matters SA-1
6-1162-KJJ-054 Business Matters SA-13
6-1162-KJJ-055 Structural Matters SA-13
6-1162-KJJ-056 Noise and Emission Matters SA-13
6-1162-KJJ-057 Product Development Matters SA-13
6-1162-KJJ-058 Additional Substitution Rights SA-13
6-1162-KJJ-150 Flight Control Computer & Mode SA-14
Control Panel Spares Matter
6-1162-MSA-185 Delivery Change Contractual SA-18
Matters
iv
P.A. No. 1810
K/SWA SA-18
ARTICLE 2. Delivery, Title and Risk of Loss.
2.1 Time of Delivery. The Aircraft will be delivered to Buyer by
Boeing, assembled and ready for flight and Buyer will accept delivery of the
Aircraft, in accordance with the following schedule:
Month and Year
of Delivery Quantity of Aircraft
-------------- --------------------
Block E Aircraft
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Three (3)
September 2001 One (1)
November 2001 Two (2)
Block F Aircraft
October 1998 One (1)
November 1998 Two (2)
December 1998 Two (2)
Block G Aircraft
March 1999 Two (2)
Block H Aircraft
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
November 2001 Three (3)
Block I Aircraft
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
2-1
P.A. Xx. 0000
X/XXX XX-00
Xxxxx 0000 Two (2)
May 2003 One (1)
June 2003 Two (2)
July 2003 One (1)
September 2003 Two (2)
October 2003 Two (2)
Block J Aircraft
November 2003 Two (2)
February 2004 Two (2)
March 2004 One (1)
Block K Aircraft
March 2004 One (1)
April 2004 Three (3)
May 2004 One (1)
Block L Aircraft
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
October 0000 Xxx (1)
November 2000 Four (4)
December 0000 Xxx (1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
November 2001 Two (2)
July 2003 One (1)
August 2003 Two (2)
Block T Aircraft
November 2001 One (1)
February 2002 One (1)
May 2004 One (1)
June 2004 Four (4)
July 2004 Four (4)
August 2004 Two (2)
September 2004 Two (2)
November 2004 One (1)
December 2004 One (1)
January 2005 Five (5)
February 2005 Two (2)
March 2005 One (1)
April 2005 Two (2)
May 2005 One (1)
2-2
P.A. No. 1810
K/SWA SA-18
June 2005 Three (3)
July 2005 Two (2)
August 2005 One (1)
September 2005 Two (2)
October 2005 One (1)
November 2005 Two (2)
December 2005 Two (2)
February 2006 Four (4)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
July 2007 Two (2)
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
January 2008 One (1)
February 2008 One (1)
March 2008 One (1)
April 2008 One (1)
May 2008 One (1)
June 2008 One (1)
2.2 Notice of Target Delivery Date. Boeing will give Buyer notice of
the Target Delivery Date of the Aircraft approximately 30 days prior to the
scheduled month of delivery.
2.3 Notice of Delivery Date. If Boeing gives Buyer at least 7 days'
notice of the delivery date of the Aircraft, and an Aircraft delivery is delayed
beyond such delivery date due to the responsibility of Buyer, Buyer will
reimburse Boeing for all costs incurred by Boeing as a result of such delay,
including amounts for storage, insurance, Taxes, preservation or protection of
the Aircraft and interest on payments due.
2.4 Place of Delivery. The Aircraft will be delivered at an airport
facility selected by Boeing in the State of Washington, unless mutually agreed
otherwise.
2-3
P.A. No. 1810
K/SWA SA-18
2.5 Title and Risk of Loss. Title to and risk of loss of an Aircraft
will pass from Boeing to Buyer upon delivery of such Aircraft, but not prior
thereto.
2.6 Xxxx of Sale. Upon delivery of an Aircraft Boeing will deliver to
Buyer a xxxx of sale conveying good title to such Aircraft, free of all liens,
claims, charges and encumbrances of every kind whatsoever, and such other
appropriate documents of title as Buyer may reasonably request.
2-4
P.A. No. 1810
K/SWA SA-18
ARTICLE 3. Price of Aircraft.
3.1 Definitions.
3.1.1 Special Features are the features incorporated in
Exhibit A which have been selected by Buyer.
3.1.2 Base Aircraft Price is the Aircraft Basic Price
excluding the price of Special Features.
3.1.3 Aircraft Basic Price is comprised of the Base Aircraft
Price and the price of the Special Features.
3.1.4 Economic Price Adjustment is the adjustment to the
Aircraft Basic Price (Base Aircraft and Special Features) as calculated pursuant
to Exhibit D or Exhibit D-1 as applicable.
3.1.5 Aircraft Price is the total amount Buyer is to pay for
the Aircraft at the time of delivery.
3.2 Aircraft Basic Price.
The Aircraft Basic Price for Block A through L Aircraft, is
expressed in July 1992 dollars; the Aircraft Basic Price for Block T Aircraft,
is expressed in July 1999 dollars; as set forth below:
Base Special Aircraft
Aircraft Price Features Basic Price
-------------- -------- -----------
Block A, B, C,
D & E Aircraft *** *** ***
Block F & G
Aircraft *** *** ***
Block H
Aircraft *** *** ***
Block I
Aircraft *** *** ***
Block J
Aircraft *** *** ***
Block K
Aircraft *** *** ***
Block L
Aircraft *** *** ***
Block T
Aircraft *** *** ***
3-1
P.A. No. 1810
K/SWA SA-18
3.3 Aircraft Price. The Aircraft Price will be established at the time
of delivery of such Aircraft to Buyer and will be the sum of:
3.3.1 the Aircraft Basic Price, which is *** for the Block A,
B, C, D and E Aircraft, *** for the Block F and G Aircraft, *** for the Block H
Aircraft, *** for the Block I Aircraft, *** for the Block J Aircraft, *** for
the Block K Aircraft and *** for the Block L Aircraft; *** for the Block T
Aircraft; plus
3.3.2 the Economic Price Adjustments for the Aircraft Basic
Price, as calculated pursuant to the formulas set forth in Exhibit D (Price
Adjustments Due to Economic Fluctuations - Aircraft) for Aircraft Block A
through L, and in Exhibit D-1 (Price Adjustments Due to Economic Fluctuations -
Aircraft) for Aircraft Block T; plus
3.3.3 other price adjustments made pursuant to this Agreement
or other written agreements executed by Boeing and Buyer.
3.4 Advance Payment Base Price.
3.4.1 Advance Payment Base Price. For advance payment
purposes, the following estimated delivery prices of the Aircraft (Advance
Payment Base Price) have been established, using currently available forecasts
of the escalation factors used by Boeing as of the date of signing this
Agreement. The Advance Payment Base Price of each Aircraft is set forth below:
Month and Year of Advance Payment Base
Scheduled Delivery Price per Aircraft
------------------ --------------------
Block A Aircraft***
October 1997
November 1997
Block B Aircraft***
January 1998
February 1998
March 1998
April 1998
May 1998
June 1998
July 1998
September 1998
3-2
P.A. Xx. 0000
X/XXX XX-00
Xxxxx C Aircraft***
February 1999
May 1999
July 1999
August 1999
September 1999
Block D Aircraft***
November 1999
December 1999
January 2000
March 2000
July 2000
August 2000
Block E Aircraft***
December 2000
January 2001
February 2001
March 2001
June 2001
September 2001
November 2001
Block F Aircraft***
October 1998
November 1998
December 1998
Block G Aircraft***
March 1999
Block H Aircraft***
June 1999
July 1999
August 1999
September 1999
October 1999
March 2000
April 2000
September 2000
October 2000
March 2001
April 2001
November 2001
3-3
P.A. Xx. 0000
X/XXX XX-00
Xxxxx I Aircraft***
November 2001
December 2001
January 2002
March 2002
April 2002
May 2003
June 2003
July 2003
September 2003
October 2003
Block J Aircraft***
November 2003
February 2004
March 2004
Block K Aircraft***
March 2004
April 2004
May 2004
Block L Aircraft***
October 1999
November 1999
December 1999
June 2000
July 2000
September 2000
October 2000
November 2000
December 2000
January 2001
February 2001
July 2001
November 2001
July 2003
August 2003
Block T Aircraft***
November 2001
February 2002
May 2004
June 2004
July 2004
August 2004
September 2004
November 2004
December 2004
3-4
P.A. No. 1810
K/SWA SA-18
January 2005
February 2005
March 2005
April 2005
May 2005
June 2005
July 2005
August 2005
September 2005
October 2005
November 2005
December 2005
February 2006
May 2006
June 2006
July 2006
August 2006
September 2006
November 2006
December 2006
January 2007
February 2007
March 2007
April 2007
May 2007
June 2007
July 2007
August 2007
September 2007
October 2007
November 2007
December 2007
January 2008
February 2008
March 2008
April 2008
May 2008
June 2008
3-5
P.A. No. 1810
K/SWA SA-18
3.4.2 Adjustment of Advance Payment Base Prices - Long-Lead Aircraft.
For Aircraft scheduled for delivery 36 months or more after the date of this
Agreement, the Advance Payment Base Prices appearing in Article 3.4.1 will be
used to determine the amount of the first advance payment to be made by Buyer on
the Aircraft. No later than 25 months before the scheduled month of delivery of
each affected Aircraft, Boeing will increase or decrease the Advance Payment
Base Price of such Aircraft as required to reflect the effects of (i) any
adjustments in the Aircraft Basic Price pursuant to this Agreement and (ii) the
then-current forecasted escalation factors used by Boeing. Boeing will provide
the adjusted Advance Payment Base Prices for each affected Aircraft to Buyer,
and the advance payment schedule will be considered amended to substitute such
adjusted Advance Payment Base Prices.
3-6
P.A. No. 1810
K/SWA XX-00
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000 Page 1
6-1162-MSA-185
Southwest Airlines Co.
P.O. Box 36611 - Love Field
Xxxxxx, Xxxxx 00000
Subject: Letter Agreement No. 6-1162-MSA-185 to
Purchase Agreement No. 1810
Delivery Change Contractual Matters
This Letter Agreement amends Purchase Agreement No. 1810 dated January 19, 1994
(the Agreement) between The Boeing Company (Boeing) and Southwest Airlines Co.
(Buyer) relating to Model 737-7H4 aircraft (the Aircraft).
***
All terms used herein and in the Agreement, and not defined herein, will have
the same meaning as in the Agreement.
1. ***
2. ***
2.1 ***
2.2 ***
***
3. ***
***
4. Confidential Treatment.
Buyer understands that certain commercial and financial information
contained in this Letter Agreement is considered by Boeing as confidential.
Buyer agrees that it will treat this Letter Agreement and the information
contained herein as confidential and will not, without the prior written consent
of Boeing, disclose this Letter Agreement or any information contained herein to
any other person or entity, except as provided in Letter Agreement
6-1162-RLL-934R1.
P.A. No. 1810
K/SWA XX-00
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000 Page 2
Very truly yours,
THE BOEING COMPANY
By /s/ XXXXXXX X. XXXXXXXX
------------------------------------
Its Attorney-In-Fact
-----------------------------------
ACCEPTED AND AGREED TO as of this
date: OCTOBER 17, 2001
-----------
SOUTHWEST AIRLINES CO.
By /s/ XXXXX XXXXXX
------------------------------------
Its V.P. - FINANCE & TREASURER
-----------------------------------
P.A. No. 1810
K/SWA SA-18
Supplemental Agreement No. 19
to
Purchase Agreement No. 1810
between
THE BOEING COMPANY
and
SOUTHWEST AIRLINES CO.
Relating to Boeing Model 737-7H4 Aircraft
THIS SUPPLEMENTAL AGREEMENT, entered into as of NOVEMBER 7, 2001, by
and between THE BOEING COMPANY, a Delaware corporation with its principal
offices in Seattle, Washington, (Boeing) and SOUTHWEST AIRLINES CO., a Texas
corporation with its principal offices in Dallas, Texas (Buyer);
WHEREAS, the parties hereto entered into Purchase Agreement No. 1810
dated January 19, 1994, relating to Boeing Model 737-7H4 aircraft (the
Agreement) and;
WHEREAS, Buyer and Boeing have agreed ***
WHEREAS, Buyer and Boeing ***
***PURSUANT TO 17 CFR 240.24b-2, CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE COMMISSION.
SA-19-1
P.A. No. 1810
K/SWA
WHEREAS, Buyer and Boeing have agreed ***
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree to amend the Agreement as follows:
1. The Table of Contents of the Agreement is deleted in its entirety and a new
Table of Contents is attached hereto and incorporated into the Agreement by this
reference.
2. Article 2, entitled "Delivery, Title and Risk of Loss," is deleted in its
entirety and replaced by a new Article 2. Such new pages 2-1, 2-2, 2-3 and 2-4
are attached hereto and incorporated into the Agreement by this reference.
3. Article 3, entitled "Price of Aircraft", is deleted in its entirety and
replaced by a new Article 3. Such new pages 3-1, 3-2, 3-3, 3-4, 3-5 and 3-6 are
attached hereto and incorporated into the Agreement by this reference.
4. Letter Agreement No. 6-1162-MSA-185 entitled "Delivery Change Contractual
Matters," is deleted in its entirety and replaced by a new Letter Agreement No.
6-1162-MSA-185R1 which is attached hereto and is incorporated into the Agreement
by this reference.
5. Advance Payment values shall be the same as in effect as of the date of
Supplemental Agreement 18 (October 17, 2001).
The Agreement will be deemed to be supplemented to the extent herein provided
and as so supplemented will continue in full force and effect.
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY SOUTHWEST AIRLINES CO.
By: /s/ XXXXXXX X. XXXXXXXX By: /s/ XXXXX XXXXXX
--------------------------- ------------------------------
Its: Attorney-In-Fact Its: VICE-PRESIDENT & TREASURER
-------------------------- -----------------------------
SA-19-2
P.A. No. 1810
K/SWA
TABLE OF CONTENTS
Page SA
Number Number
------ ------
ARTICLES
--------
1. Subject Matter of Sale..........................................1-1 SA-13
2. Delivery, Title and Risk
of Loss.........................................................2-1 SA-19
3. Price of Aircraft...............................................3-1 SA-19
4. Taxes...........................................................4-1
5. Payment.........................................................5-1
6. Excusable Delay.................................................6-1
7. Changes to the Detail
Specification...................................................7-1 SA-1
8. Federal Aviation Requirements and
Certificates and Export License.................................8-1
9. Representatives, Inspection,
Flights and Test Data...........................................9-1
10. Assignment, Resale or Lease....................................10-1
11. Termination for Certain Events.................................11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance..................................................12-1
13. Buyer Furnished Equipment and
Spare Parts....................................................13-1
14. Contractual Notices and Requests...............................14-1
15. Miscellaneous..................................................15-1
i
P.A. No. 1810
K/SWA SA-19
TABLE OF CONTENTS
SA
Number
------
EXHIBITS
--------
A Aircraft Configuration SA-13
B Product Assurance Document SA-1
C Customer Support Document
D Price Adjustments Due to
Economic Fluctuations - Aircraft SA-13
E Buyer Furnished Equipment
Provisions Document
F Defined Terms Document
LETTER AGREEMENTS
-----------------
1810-1 Waiver of Aircraft Demonstration Flight
ii
P.A. No. 1810
K/SWA SA-19
TABLE OF CONTENTS
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-932R2 Promotional Support SA-13
6-1162-RLL-933R11 Option Aircraft SA-18
6-1162-RLL-934R3 Disclosure of Confidential SA-14
Information
6-1162-RLL-935R1 Performance Guarantees XX-0
0-0000-XXX-000X0 Xxxxxxx Contractual Matters XX-0
0-0000-XXX-000 Xxxxxxxxx Advance Payment Schedule
6-1162-RLL-938 ***
6-1162-RLL-939R1 Certification Flight Test Aircraft SA-1
6-1162-RLL-940R1 Training Matters SA-1
6-1162-RLL-941R2 Other Matters SA-13
6-1162-RLL-942 Open Configuration Matters
6-1162-RLL-943R1 Substitution Rights XX-0
0-0000-XXX-000 Xxxxxxxx Maintenance Material Cost
Protection Program
6-1162-RLL-945 Comparison of 737-7H4 and 000-0X0
Xxxxx Xxxx Xxxx
0-0000-XXX-0000X0 Additional Contractual Matters SA-4
6-1162-RLL-1856 *** SA-1
6-1162-RLL-1857 Service Ready Validation Program SA-1
Field Test
6-1162-RLL-1858R1 Escalation Matters SA-4
iii
P.A. No. 1810
K/SWA SA-19
TABLE OF CONTENTS CON'T
SA
Number
------
RESTRICTED LETTER AGREEMENTS
----------------------------
6-1162-RLL-2036 Amortization of Costs for
Customer Unique Changes XX-0
0-0000-XXX-0000 Xxxxxxxxxxxxxx of the Aircraft SA-1
Basic Price
6-1162-RLL-2073 Maintenance Training Matters SA-1
6-1162-KJJ-054 Business Matters SA-13
6-1162-KJJ-055 Structural Matters SA-13
6-1162-KJJ-056 Noise and Emission Matters SA-13
6-1162-KJJ-057 Product Development Matters SA-13
6-1162-KJJ-058 Additional Substitution Rights SA-13
6-1162-KJJ-150 Flight Control Computer & Mode SA-14
Control Panel Spares Matter
6-1162-MSA-185R1 Delivery Change Contractual SA-19
Matters
iv
P.A. No. 1810
K/SWA SA-19
ARTICLE 2. Delivery, Title and Risk of Loss.
2.1 Time of Delivery. The Aircraft will be delivered to Buyer by
Boeing, assembled and ready for flight and Buyer will accept delivery of the
Aircraft, in accordance with the following schedule:
Month and Year
of Delivery Quantity of Aircraft
-------------- --------------------
Block E Aircraft
December 2000 Two (2)
January 2001 One (1)
February 2001 One (1)
March 2001 Two (2)
June 2001 Three (3)
September 2001 Three (1)
Block F Aircraft
October 1998 One (1)
November 1998 Two (2)
December 1998 Two (2)
Block G Aircraft
March 1999 Two (2)
Block H Aircraft
June 1999 Two (2)
July 1999 One (1)
August 1999 One (1)
September 1999 Two (2)
October 1999 One (1)
March 0000 Xxx (1)
April 2000 Two (2)
September 0000 Xxx (1)
October 2000 Two (2)
March 2001 Two (2)
April 2001 One (1)
October 2001 Three (3)
Block I Aircraft
November 2001 Two (2)
December 2001 One (1)
January 2002 One (1)
March 2002 Four (4)
April 2002 Two (2)
2-1
P.A. No. 1810
K/SWA SA-19
May 2003 One (1)
June 2003 Two (2)
July 2003 One (1)
September 2003 Two (2)
October 2003 Two (2)
Block J Aircraft
November 2003 Two (2)
February 2004 Two (2)
March 2004 One (1)
Block K Aircraft
March 2004 One (1)
April 2004 Three (3)
May 2004 One (1)
Block L Aircraft
October 1999 One (1)
November 1999 Two (2)
December 1999 One (1)
June 2000 Three (3)
July 2000 Three (3)
September 0000 Xxx (1)
October 0000 Xxx (1)
November 2000 Four (4)
December 0000 Xxx (1)
January 2001 One (1)
February 2001 One (1)
July 2001 One (1)
September 2001 One (1)
October 2001 One (1)
July 2003 One (1)
August 2003 Two (2)
Block T Aircraft
November 2001 One (1)
February 2002 One (1)
May 2004 One (1)
June 2004 Four (4)
July 2004 Four (4)
August 2004 Two (2)
September 2004 Two (2)
November 2004 One (1)
December 2004 One (1)
January 2005 Five (5)
February 2005 Two (2)
March 2005 One (1)
April 2005 Two (2)
May 2005 One (1)
2-2
P.A. No. 1810
K/SWA SA-19
June 2005 Three (3)
July 2005 Two (2)
August 2005 One (1)
September 2005 Two (2)
October 2005 One (1)
November 2005 Two (2)
December 2005 Two (2)
February 2006 Four (4)
May 2006 Three (3)
June 2006 Four (4)
July 2006 One (1)
August 2006 Three (3)
September 2006 Three (3)
November 2006 Two (2)
December 2006 Two (2)
January 2007 Two (2)
February 2007 Three (3)
March 2007 Two (2)
April 2007 Two (2)
May 2007 Two (2)
June 2007 Two (2)
July 2007 Two (2)
August 2007 Two (2)
September 2007 Two (2)
October 2007 Two (2)
November 2007 Two (2)
December 2007 Two (2)
January 2008 One (1)
February 2008 One (1)
March 2008 One (1)
April 2008 One (1)
May 2008 One (1)
June 2008 One (1)
2.2 Notice of Target Delivery Date. Boeing will give Buyer notice of
the Target Delivery Date of the Aircraft approximately 30 days prior to the
scheduled month of delivery.
2.3 Notice of Delivery Date. If Boeing gives Buyer at least 7 days'
notice of the delivery date of the Aircraft, and an Aircraft delivery is delayed
beyond such delivery date due to the responsibility of Buyer, Buyer will
reimburse Boeing for all costs incurred by Boeing as a result of such delay,
including amounts for storage, insurance, Taxes, preservation or protection of
the Aircraft and interest on payments due.
2.4 Place of Delivery. The Aircraft will be delivered at an airport
facility selected by Boeing in the State of Washington, unless mutually agreed
otherwise.
2-3
P.A. No. 1810
K/SWA SA-19
2.5 Title and Risk of Loss. Title to and risk of loss of an Aircraft
will pass from Boeing to Buyer upon delivery of such Aircraft, but not prior
thereto.
2.6 Xxxx of Sale. Upon delivery of an Aircraft Boeing will deliver to
Buyer a xxxx of sale conveying good title to such Aircraft, free of all liens,
claims, charges and encumbrances of every kind whatsoever, and such other
appropriate documents of title as Buyer may reasonably request.
2-4
P.A. No. 1810
K/SWA SA-19
ARTICLE 3. Price of Aircraft.
3.1 Definitions.
3.1.1 Special Features are the features incorporated in
Exhibit A which have been selected by Buyer.
3.1.2 Base Aircraft Price is the Aircraft Basic Price
excluding the price of Special Features.
3.1.3 Aircraft Basic Price is comprised of the Base Aircraft
Price and the price of the Special Features.
3.1.4 Economic Price Adjustment is the adjustment to the
Aircraft Basic Price (Base Aircraft and Special Features) as calculated pursuant
to Exhibit D or Exhibit D-1 as applicable.
3.1.5 Aircraft Price is the total amount Buyer is to pay for
the Aircraft at the time of delivery.
3.2 Aircraft Basic Price.
The Aircraft Basic Price for Block A through L Aircraft, is
expressed in July 1992 dollars; the Aircraft Basic Price for Block T Aircraft,
is expressed in July 1999 dollars; as set forth below:
Base Special Aircraft
Aircraft Price Features Basic Price
Block A, B, C,
D & E Aircraft *** *** ***
Block F & G *** *** ***
Aircraft
Block H *** *** ***
Aircraft
Block I *** *** ***
Aircraft
Block J *** *** ***
Aircraft
Block K *** *** ***
Aircraft
Block L *** *** ***
Aircraft
Block T *** *** ***
Aircraft
00-0
X.X. Xx. 0000
X/XXX XX-00
3.3 Aircraft Price. The Aircraft Price will be established at the time
of delivery of such Aircraft to Buyer and will be the sum of:
3.3.1 the Aircraft Basic Price, which is ***for the Block A,
B, C, D and E Aircraft, ***for the Block F and G Aircraft*** for the Block H
Aircraft,***) for the Block I Aircraft, ***for the Block J Aircraft, ***for the
Block K Aircraft and ***for the Block L Aircraft; ***for the Block T Aircraft;
plus
3.3.2 the Economic Price Adjustments for the Aircraft Basic
Price, as calculated pursuant to the formulas set forth in Exhibit D (Price
Adjustments Due to Economic Fluctuations - Aircraft) for Aircraft Block A
through L, and in Exhibit D-1 (Price Adjustments Due to Economic Fluctuations -
Aircraft) for Aircraft Block T; plus
3.3.3 other price adjustments made pursuant to this Agreement
or other written agreements executed by Boeing and Buyer.
3.4 Advance Payment Base Price.
3.4.1 Advance Payment Base Price. For advance payment
purposes, the following estimated delivery prices of the Aircraft (Advance
Payment Base Price) have been established, using currently available forecasts
of the escalation factors used by Boeing as of the date of signing this
Agreement. The Advance Payment Base Price of each Aircraft is set forth below:
Month and Year of Advance Payment Base
Scheduled Delivery Price per Aircraft
------------------ --------------------
Block A Aircraft***
October 1997
November 1997
Block B Aircraft***
January 1998
February 1998
March 1998
April 1998
May 1998
June 1998 July 1998
September 1998
00-0
X.X. Xx. 0000
X/XXX XX-00
Xxxxx C Aircraft***
February 1999
May 1999
July 1999
August 1999
September 1999
Block D Aircraft***
November 1999
December 1999
January 2000
March 2000
July 2000
August 2000
Block E Aircraft***
December 2000
January 2001
February 2001
March 2001
June 2001
September 2001
Block F Aircraft***
October 1998
November 1998
December 1998
Block G Aircraft***
March 1999
Block H Aircraft***
June 1999
July 1999
August 1999
September 1999
October 1999
March 2000
April 2000
September 2000
October 2000
March 2001
April 2001
October 2001
00-0
X.X. Xx. 0000
X/XXX XX-00
Xxxxx I Aircraft***
November 2001
December 2001
January 2002
March 2002
April 2002
May 2003
June 2003
July 2003
September 2003
October 2003
Block J Aircraft***
November 2003
February 2004
March 2004
Block K Aircraft***
March 2004
April 2004
May 2004
Block L Aircraft***
October 1999
November 1999
December 1999
June 2000
July 2000
September 2000
October 2000
November 2000
December 2000
January 2001
February 2001
July 2001
September 2001
October 2001
July 2003
August 2003
Block T Aircraft***
November 2001
February 2002
May 2004
June 2004
July 2004
August 2004
September 2004
15-4
P.A. No. 1810
K/SWA SA-19
November 2004
December 2004
January 2005
February 2005
March 2005
April 2005
May 2005
June 2005
July 2005
August 2005
September 2005
October 2005
November 2005
December 2005
February 2006
May 2006
June 2006
July 2006
August 2006
September 2006
November 2006
December 2006
January 2007
February 2007
March 2007
April 2007
May 2007
June 2007
July 2007
August 2007
September 2007
October 2007
November 2007
December 2007
January 2008
February 2008
March 2008
April 2008
May 2008
June 2008
15-5
P.A. No. 1810
K/SWA SA-19
3.4.2 Adjustment of Advance Payment Base Prices - Long-Lead Aircraft.
For Aircraft scheduled for delivery 36 months or more after the date of this
Agreement, the Advance Payment Base Prices appearing in Article 3.4.1 will be
used to determine the amount of the first advance payment to be made by Buyer on
the Aircraft. No later than 25 months before the scheduled month of delivery of
each affected Aircraft, Boeing will increase or decrease the Advance Payment
Base Price of such Aircraft as required to reflect the effects of (i) any
adjustments in the Aircraft Basic Price pursuant to this Agreement and (ii) the
then-current forecasted escalation factors used by Boeing. Boeing will provide
the adjusted Advance Payment Base Prices for each affected Aircraft to Buyer,
and the advance payment schedule will be considered amended to substitute such
adjusted Advance Payment Base Prices.
00-0
X.X. Xx. 0000
X/XXX XX-00
0-0000-XXX-000X0
(there is no original, begins with R1)
Southwest Airlines Co.
P.O. Box 36611 - Love Field
Xxxxxx, Xxxxx 00000
Subject: Letter Agreement No. 6-1162-MSA-185R1 to
Purchase Agreement No. 1810
Delivery Change Contractual Matters
This Letter Agreement amends Purchase Agreement No. 1810 dated January 19, 1994
(the Agreement) between The Boeing Company (Boeing) and Southwest Airlines Co.
(Buyer) relating to Model 737-7H4 aircraft (the Aircraft).
***
All terms used herein and in the Agreement, and not defined herein, will have
the same meaning as in the Agreement.
1.
***
2. ***
2.1 ***
2.2 ***
2.3 ***
3. ***
P.A. No. 1810
K/SWA XX-00
Xxxxxxxxx Xxxxxxxx Xx.
0-0000-XXX-000 Page 2
4. Confidential Treatment.
Buyer understands that certain commercial and financial information
contained in this Letter Agreement is considered by Boeing as confidential.
Buyer agrees that it will treat this Letter Agreement and the information
contained herein as confidential and will not, without the prior written consent
of Boeing, disclose this Letter Agreement or any information contained herein to
any other person or entity, except as provided in Letter Agreement
6-1162-RLL-934R1.
Very truly yours,
THE BOEING COMPANY
By /s/ XXXXXXX X. XXXXXXXX
------------------------------------
Its Attorney In Fact
-----------------------------------
ACCEPTED AND AGREED TO as of this
date: OCTOBER 17, 2001
-----------
SOUTHWEST AIRLINES CO.
By /s/ XXXXX XXXXXX
------------------------------------
Its V.P. - Finance & Treasurer
-----------------------------------
P.A. No. 1810
K/SWA SA-19
