1
EXHIBIT 10.87
AIRCRAFT GENERAL TERMS AGREEMENT
AGTA-TLS
between
THE BOEING COMPANY
and
ATLAS AIR, INC.
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TABLE OF CONTENTS
PAGE
ARTICLES NUMBER
1. Subject Matter of Sale 1
2. Price, Taxes and Payment 1
3. Regulatory Requirements and Certificates 3
4. Detail Specification; Changes 4
5. Representatives, Inspection, Flight Tests, Test Data
and Performance Guarantee Compliance 4
6. Delivery 5
7. Excusable Delay 5
8. Risk Allocation/Insurance 6
9. Assignment, Resale or Lease 7
10. Termination for Certain Events 9
11. Notices 9
12. Miscellaneous 10
EXHIBITS
A Buyer Furnished Equipment Provisions Document
B Customer Support Document
C Product Assurance Document
D Escalation Adjustment
APPENDICES
I Insurance Certificate
II Purchase Agreement Assignment
III Post-Delivery Sale Notice
IV Post-Delivery Lease Notice
V Purchaser's/Lessee's Agreement
VI Owner Appointment of Agent - Warranties
VII Contractor Confidentiality Agreement
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AIRCRAFT GENERAL TERMS AGREEMENT NUMBER AGTA-TLS
between
The Boeing Company
and
ATLAS AIR, INC.
Relating to
BOEING AIRCRAFT
This Aircraft General Terms Agreement Number AGTA-TLS (AGTA) dated as of ,
1997, between The Boeing Company (Boeing) and Atlas Air, Inc. (Customer) will
apply to all Boeing aircraft contracted for purchase from Boeing by Customer
after this date, unless otherwise mutually agreed by Boeing and Customer.
Article 1. Subject Matter of Sale.
1.1. Aircraft. Boeing will manufacture and sell to Customer and Customer
will purchase from Boeing aircraft under purchase agreements which incorporate
the terms and conditions of this AGTA.
1.2. Buyer Furnished Equipment. Exhibit A, Buyer Furnished Equipment
Provisions Document to the AGTA, contains the obligations of Customer and Boeing
with respect to equipment purchased and provided by Customer, which Boeing will
receive, inspect, store and install in an aircraft before delivery to Customer.
This equipment is defined as Buyer Furnished Equipment (BFE).
1.3. Customer Support. Exhibit B, Customer Support Document to the AGTA,
contains the obligations of Boeing relating to Materials (as defined in Part 3
thereof), training, services and other things in support of aircraft.
1.4. Product Assurance. Exhibit C, Product Assurance Document to the AGTA,
contains the obligations of Boeing and the suppliers of equipment installed in
each aircraft at delivery relating to warranties, patent indemnities, software
copyright indemnities and service life policies.
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Article 2. Price, Taxes and Payment.
2.1. Price.
2.1.1 Airframe Price is defined as the price of the airframe for a
specific model of aircraft described in a purchase agreement. (For Models
737-600, 737-700 and 737-800, the Airframe Price includes Engine Price.)
2.1.2 Optional Features Prices are defined as the prices for optional
features selected by Customer for a specific model of aircraft described in a
purchase agreement.
2.1.3 Engine Price is defined as the price set by the engine
manufacturer for a specific engine to be installed on the model of aircraft
described in a purchase agreement (not applicable to Models 737-600, 737-700
and 737-800).
2.1.4 Aircraft Basic Price is defined as the sum of the Airframe
Price, Optional Features Prices and the Engine Price, if applicable.
2.1.5 Escalation Adjustment is defined as the price adjustment to the
Airframe Price and the Optional Features Prices (and the Engine Price for
Models 737-600, 737-700 and 737-800) resulting from the calculation using the
economic price formula contained in Exhibit D, Escalation Adjustment to the
AGTA. The price adjustment to the Engine Price for all other models of aircraft
will be calculated using the economic price formula in the Engine Escalation
Adjustment to the applicable purchase agreement.
2.1.6 Advance Payment Base Price is defined as the estimated price of
an aircraft as of the date of signing a purchase agreement for the scheduled
month of delivery of such aircraft using commercial forecasts of the Escalation
Adjustment.
2.1.7 Aircraft Price is defined as the total amount Customer is to pay
for an aircraft at the time of delivery, which is the sum of the Aircraft Basic
Price, the Escalation Adjustment and other price adjustments made pursuant to
the purchase agreement.
2.2. Taxes. Taxes are defined as all taxes, fees, charges or duties and any
interest, penalties, fines or other additions to tax, including, but not limited
to sales, use, value added, gross receipts, stamp, excise, transfer and similar
taxes, imposed by any domestic or foreign taxing authority arising out of or in
connection with the performance of the applicable purchase agreement or the
sale, delivery, transfer or storage of any aircraft, BFE, or other things
furnished under the applicable purchase agreement. Except for U.S. federal
income taxes and Washington State business and occupation taxes imposed on
Boeing or Boeing's assignee, Customer will be responsible for filing all tax
returns, reports and declarations and paying all Taxes.
2.3. Payment.
2.3.1 Advance Payment Schedule. Customer will make advance payments to
Boeing for each aircraft in the amounts and on the dates indicated in the
schedule set forth in the applicable purchase agreement.
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2.3.2 Payment at Delivery. Customer will pay any unpaid balance of the
Aircraft Price at the time of delivery of each aircraft.
2.3.3 Form of Payment. Customer will make all payments to Boeing by
unconditional deposit of United States Dollars in a bank account in the United
States designated by Boeing.
2.3.4 Monetary and Government Regulations. Customer is responsible for
complying with all monetary control regulations and for obtaining necessary
governmental authorizations related to payments.
Article 3. Regulatory Requirements and Certificates.
3.1. Certificates. Boeing will manufacture each aircraft to conform to the
appropriate Type Certificate issued by the United States Federal Aviation
Administration (FAA) for the specific model of aircraft and will obtain from the
FAA and furnish to Customer at delivery of each aircraft either a Standard
Airworthiness Certificate or an Export Certificate of Airworthiness issued
pursuant to Part 21 of the Federal Aviation Regulations.
3.2. FAA or Applicable Regulatory Authority Manufacturer Changes.
3.2.1 A Manufacturer Change is defined as any change to an aircraft,
data relating to an aircraft, or testing of an aircraft required by the FAA to
obtain a Standard Airworthiness Certificate or by the country of import and/or
registration to obtain an Export Certificate of Airworthiness.
3.2.2 A Manufacturer Change will be incorporated at no charge to
Customer unless:
(i) the FAA issues the requirement after the date of the
applicable purchase agreement, and the scheduled delivery month of the
affected aircraft is after the date of the Type Certificate for the
model of aircraft, or more than 18 months after the date of the
purchase agreement, whichever is later; or
(ii) the requirement is solely necessary to comply with a
requirement of the country of import and/or registration.
3.2.3 Customer will pay Boeing's charge for validation of an aircraft
required by any governmental agency of the country of import and/or
registration.
3.3. FAA Operator Changes.
3.3.1 An Operator Change is defined as a change in equipment that is
required by Federal Aviation Regulations which (i) is generally applicable to
transport category aircraft to be used in United States certified air carriage
and (ii) the required compliance date is on or before the scheduled delivery
month of the aircraft.
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3.3.2 Boeing will deliver each aircraft with Operator Changes
incorporated or, at Boeing's option, with suitable provisions for the
incorporation of such equipment and Customer will pay Boeing's applicable
charges.
3.3.3 Export License. If an export license is required by United
States law or regulation for any aircraft or any other things delivered under
the purchase agreement, it is Customer's obligation to obtain such license. If
requested, Boeing will assist Customer in applying for any such export license.
Customer will furnish any required supporting documents.
Article 4. Detail Specification; Changes.
4.1. Configuration Changes. The Detail Specification is defined as the
Boeing document that describes the configuration of each aircraft purchased by
Customer. The Detail Specification for each aircraft may be amended by (i)
Boeing to reflect the incorporation of Manufacturer Changes and Operator Changes
or (ii) by the agreement of the parties. In either case the amendment will
describe the particular changes to be made and any effect on design,
performance, weight, balance, scheduled delivery month, Aircraft Basic Price,
Aircraft Price and Advance Payment Base Price.
4.2. Development Changes. Development Changes are defined as changes to
aircraft that do not affect the Aircraft Price or scheduled delivery month, and
do not adversely affect guaranteed weight, guaranteed performance or compliance
with the interchangeability or replaceability requirements set forth in the
applicable Detail Specification. Boeing may, at its option, incorporate
Development Changes into the Detail Specification and into an aircraft prior to
delivery to Customer.
4.3. Notices. Boeing will promptly notify Customer of any amendments to
the Detail Specification.
Article 5. Representatives, Inspection, Demonstration Flights, Test Data and
Performance Guarantee Compliance.
5.1. Office Space. Twelve months before delivery of the first aircraft
purchased, and continuing until the delivery of the last aircraft on firm order,
Boeing will furnish, free of charge, suitable office space and equipment for the
accommodation of up to three representatives of Customer in or conveniently
located near the assembly plant.
5.2. Inspection. Customer's representatives may inspect each aircraft at
any reasonable time provided such inspection does not interfere with Boeing's
performance.
5.3. Demonstration Flights. Prior to delivery, Boeing will fly each
aircraft up to 4 hours to demonstrate to Customer the function of the aircraft
and its equipment following Boeing's production flight test procedures. Customer
may designate up to five representatives to participate as observers.
5.4. Test Data; Performance Guarantee Compliance. Performance Guarantees
are defined as the written guarantees in a purchase agreement regarding the
operational performance of an aircraft. Boeing
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will furnish to Customer flight test data obtained on an aircraft of the same
model to evidence compliance with such Performance Guarantees. Performance
Guarantees will be met if reasonable engineering interpretations and
calculations based on the flight test data establish that the particular
aircraft being delivered under the applicable purchase agreement would, if
actually flown, comply with the guarantees.
5.5. Special Aircraft Test Requirements. Boeing may use an aircraft for
flight and ground tests prior to delivery, without reduction in the Aircraft
Price, if the tests are considered necessary by Boeing (i) to obtain or maintain
the Type Certificate or Certificate of Airworthiness for the aircraft; or (ii)
to evaluate potential improvements that may be offered for production or
retrofit incorporation.
Article 6. Delivery.
6.1. Notices of Delivery Dates. Boeing will notify Customer of the
approximate delivery date of each aircraft at least 30 days before the scheduled
month of delivery and at least 14 days before the scheduled delivery date.
6.2. Place of Delivery. Each aircraft will be delivered at a facility
selected by Boeing in the State of Washington.
6.3. Xxxx of Sale. At delivery of an aircraft, Boeing will provide Customer
a xxxx of sale conveying good title, free of encumbrances.
6.4. Delay. If Customer delays acceptance of an aircraft beyond the
scheduled delivery date, Customer will reimburse Boeing for all costs incurred
by Boeing as a result of the delay.
Article 7. Excusable Delay.
7.1. General. Boeing will not be liable for any delay in the scheduled
delivery month of an aircraft or other performance under the applicable purchase
agreement caused by (i) acts of God; (ii) war or armed hostilities; (iii)
government acts or priorities; (iv) fires, floods, or earthquakes; (v) strikes
or labor troubles causing cessation, slowdown, or interruption of work; or (vi)
any other cause to the extent such cause is beyond Boeing's control and not
occasioned by Boeing's fault or negligence. A delay resulting from any such
cause is defined as an Excusable Delay.
7.2. Notice. Boeing will give written notice to Customer (i) of a delay as
soon as it concludes that an aircraft will be delayed beyond the scheduled
delivery month due to an Excusable Delay; and (ii) of a revised delivery month
based on Boeing's appraisal of the facts.
7.3. Delay in Delivery of Twelve Months or Less. If the revised delivery
month in such notice is 12 months or less after the scheduled delivery month,
Customer will accept such aircraft when tendered for delivery, subject to the
following:
7.3.1 The calculation of the Escalation Adjustment will be based on
the previously scheduled delivery month.
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7.3.2 The advance payment schedule will be adjusted to reflect the
revised delivery month.
7.3.3 All other provisions of the applicable purchase agreement,
including the BFE on dock dates for the delayed aircraft, are unaffected by
an Excusable Delay.
7.4. Delay in Delivery of More Than Twelve Months. If the revised delivery
month in such notice is more than 12 months after the scheduled delivery month,
either party may terminate the applicable purchase agreement with respect to
such aircraft within 30 days of the notice. If either party does not terminate
the applicable purchase agreement with respect to such aircraft, all terms and
conditions of the applicable purchase agreement will remain in effect.
7.5. Aircraft Damaged Beyond Repair. If an aircraft is destroyed or damaged
beyond repair for any reason before delivery, Boeing will give written notice to
Customer specifying the earliest month possible, consistent with Boeing's other
contractual commitments and production capabilities, in which Boeing can deliver
a replacement. Customer will have 30 days from receipt of notice to elect to
have Boeing manufacture a replacement aircraft under the same terms and
conditions of purchase, except that the calculation of the Escalation Adjustment
will be based upon the scheduled delivery month, or, failing such election, the
applicable purchase agreement will terminate with respect to such aircraft.
Boeing will not be obligated to manufacture a replacement aircraft if
reactivation of the production line for the specific model of aircraft is
required.
7.6. Termination. Termination under this Article will discharge all
obligations and liabilities of Boeing and Customer with respect to any aircraft
and all related undelivered Materials, training, services and other things
terminated under the applicable purchase agreement, except that Boeing will
return to Customer, without interest, an amount equal to all advance payments
paid by Customer for the aircraft. If Customer terminates the applicable
purchase agreement as to any aircraft, Boeing may elect, by written notice to
Customer within 30 days, to purchase from Customer any BFE related to the
aircraft at the invoice prices paid, or contracted to be paid, by Customer.
7.7. Exclusive Rights. The termination rights in this Article are in
substitution for all other rights of termination or any claim arising by
operation of law due to delays in performance covered by this Article.
Article 8. Risk Allocation/Insurance.
8.1. Title and Risk with Boeing.
8.1.1 Boeing's Indemnification of Customer. Until transfer of title to
an aircraft to Customer, Boeing will indemnify and hold harmless Customer and
Customer's observers from and against all claims and liabilities, including all
expenses and attorneys' fees incident thereto or incident to establishing the
right to indemnification, for injury to or death of any person(s), including
employees of Boeing but not employees of Customer, or for loss of or damage to
any property, including an aircraft, arising out of or in any way related to
the operation of an aircraft during all demonstration and test flights
conducted under the provisions of the applicable purchase agreement, whether or
not arising in tort or occasioned by the negligence of Customer or any of
Customer's observers.
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8.1.2 Definition of Customer. For the purpose of this Article,
"Customer" is defined as Atlas Air, Inc., its divisions, subsidiaries,
affiliates, the assignees of each and their respective directors, officers,
employees and agents.
8.2. Insurance.
8.2.1 Insurance Requirements. The Customer will purchase and maintain
insurance acceptable to Boeing and provide a certificate of such insurance that
names Boeing as an additional insured for any and all claims and liabilities
for injury to or death of any person or persons, including employees of
Customer but not employees of Boeing, or for loss of or damage to any property,
including any aircraft, arising out of or in any way relating to Materials,
Training, Services or other things provided under Exhibit B of the AGTA, which
will be incorporated by reference into the applicable purchase agreement,
whether or not arising in tort or occasioned by the negligence of Boeing,
except with respect to legal liability to persons or parties other than
Customer or Customer's assignees arising out of an accident caused solely by a
product defect in an aircraft. Customer will provide such certificate of
insurance at least thirty (30) days prior to the scheduled delivery of the
first aircraft under a purchase agreement. The insurance certificate will
reference each aircraft delivered to Customer pursuant to each applicable
purchase agreement. Annual renewal certificates will be submitted to Boeing
before the expiration of the policy periods. The form of the insurance
certificate, attached as Appendix I, states the terms, limits, provisions and
coverages required by this Article 8.2.1. The failure of Boeing to demand
compliance with this 8.2.1 in any year will not in any way relieve Customer of
its obligations hereunder nor constitutes a waiver by Boeing of these
obligations.
8.2.2 Noncompliance with Insurance Requirements. If Customer fails to
comply with any of the insurance requirements of Article 8.2.1 or any of the
insurers fails to pay a claim covered by the insurance or otherwise fails to
meet any of insurer's obligations required by Appendix I, Customer will provide
the same protection to Boeing as that required by Article 8.2.1 above.
8.2.3 Definition of Boeing. For purposes of this article, "Boeing" is
defined as The Boeing Company, its divisions, subsidiaries, affiliates,
assignees of each and their respective directors, officers, employees and
agents.
Article 9. Assignment, Resale or Lease.
9.1. Assignment. The applicable purchase agreement is for the benefit of
the parties and their respective successors and assigns. No rights or duties of
either party may be assigned or delegated, or contracted to be assigned or
delegated, without the prior written consent of the other party, except:
9.1.1 Either party may assign its interest to a corporation that (i)
results from any merger or reorganization of such party or (ii) acquires
substantially all the assets of such party;
9.1.2 Boeing may assign its rights to receive money; and
9.1.3 Boeing may assign any of its rights and duties to any
wholly-owned subsidiary of Boeing.
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9.1.4 Boeing may assign any of its rights and duties with respect to
Parts 1 and 3 of Exhibit B, Customer Support Document to the AGTA, to
FlightSafety Boeing Training International L.L.C.
9.2. Transfer by Customer at Delivery. Boeing will take any requested
action reasonably required for the purpose of causing an aircraft, at time of
delivery, to be subject to an equipment trust, conditional sale, lien or other
arrangement for Customer to finance the aircraft. However, no such action will
require Boeing to divest itself of title to or possession of the aircraft until
delivery of and payment for the aircraft. A sample form of assignment acceptable
to Boeing is attached as Appendix II.
9.3. Sale or Lease by Customer After Delivery. If, following delivery of an
aircraft, Customer sells or leases the aircraft (including any sale for
financing purposes), all of Customer's rights with respect to the aircraft under
the applicable purchase agreement will inure to the benefit of the purchaser or
lessee of such aircraft, effective upon Boeing's receipt of the written
agreement of the purchaser or lessee, in a form satisfactory to Boeing, to
comply with all applicable terms and conditions of the applicable purchase
agreement. Sample forms of agreement acceptable to Boeing are attached as
Appendices III and IV.
9.4. Notice of Sale or Lease After Delivery. Customer will give notice to
Boeing as soon as practicable of the sale or lease of an aircraft including in
the notice the name of the entity with title and/or possession of such aircraft.
9.5. Exculpatory Clause in Post-Delivery Sale or Lease. If, following the
delivery of an aircraft, Customer sells or leases such aircraft and obtains from
the transferee any form of exculpatory clause protecting Customer from liability
for loss of or damage to the aircraft, and/or related incidental or
consequential damages, including without limitation loss of use, revenue or
profit, Customer shall obtain for Boeing the purchaser's or lessee's written
agreement to be bound by terms and conditions substantially as set forth in
Appendix V. This Article 9.5 applies only if purchaser or lessee has not
provided to Boeing the written agreement described in Article 9.3 above.
9.6. Appointment of Agent - Warranty Claims. If, following delivery of an
aircraft, Customer appoints an agent to act directly with Boeing for the
administration of claims relating to the warranties under the applicable
purchase agreement, Boeing will deal with the agent for that purpose, effective
upon Boeing's receipt of the agent's written agreement, in a form satisfactory
to Boeing, to comply with all applicable terms and conditions of the applicable
purchase agreement. A sample form of agreement acceptable to Boeing is attached
as Appendix VI.
9.7. No Increase in Boeing Liability. No action taken by Customer or Boeing
relating to the resale or lease of an aircraft or the assignment of Customer's
rights under the applicable purchase agreement will subject Boeing to any
liability beyond that in the applicable purchase agreement or modify in any way
Boeing's obligations under the applicable purchase agreement.
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Article 10. Termination for Certain Events.
10.1. Termination. If either party
(i) ceases doing business as a going concern, suspends all or
substantially all its business operations, makes an assignment for the
benefit of creditors, or generally does not pay its debts, or admits in
writing its inability to pay its debts, or
(ii) petitions for or acquiesces in the appointment of any receiver,
trustee or similar officer to liquidate or conserve its business or any
substantial part of its assets; commences any legal proceeding such as
bankruptcy, reorganization, readjustment of debt, dissolution or
liquidation available for the relief of financially distressed debtors; or
becomes the object of any such proceeding, unless the proceeding is
dismissed or stayed within a reasonable period, not to exceed 60 days,
the other party may terminate any purchase agreement with respect to any
undelivered aircraft, Materials, training, services and other things by giving
written notice of termination.
10.2. Repayment of Advance Payments. If Customer terminates the applicable
purchase agreement under this Article, Boeing will repay to Customer, without
interest, an amount equal to any advance payments received by Boeing from
Customer with respect to undelivered aircraft.
Article 11. Notices.
All notices required by any applicable purchase agreement will be in
English, will be effective on the date of receipt and may be transmitted by any
customary means of written communication addressed as follows:
Customer: Atlas Air, Inc.
000 Xxxxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
X.X.X.
Attention: General Counsel
Boeing: Boeing Commercial Airplane Group
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
X.X.X.
Attention: Vice President - Contracts
Mail Stop 75-38
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Article 12. Miscellaneous.
12.1. Government Approval. Boeing and Customer will assist each other in
obtaining any governmental consents or approvals required to effect
certification and sale of aircraft under the applicable purchase agreement.
12.2. Headings. Article and paragraph headings used in this AGTA and in any
purchase agreement are for convenient reference only and are not intended to
affect the interpretation of this AGTA or any purchase agreement.
12.3. GOVERNING LAW. THIS AGTA AND ANY PURCHASE AGREEMENT WILL BE GOVERNED
BY THE LAW OF THE STATE OF WASHINGTON, U.S.A., EXCLUSIVE OF WASHINGTON'S
CONFLICTS OF LAWS PRINCIPLES.
12.4. Waiver/Severability. Failure by either party to enforce any provision
of this AGTA or any purchase agreement will not be construed as a waiver. If any
provision of this AGTA or any provision of any purchase agreement are held
unlawful or otherwise ineffective by a court of competent jurisdiction, the
remainder of the AGTA or the applicable purchase agreement will remain in
effect.
12.5. Survival of Obligations. The Articles and Exhibits of this AGTA
including but not limited to those relating to insurance, DISCLAIMER AND RELEASE
and the EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES will survive termination or
cancellation of any purchase agreement or part thereof.
DATED AS OF June 6, 1997
ATLAS AIR, INC. THE BOEING COMPANY
By /s/M.A. Xxxxxxx By Xxxx X. Xxxxxx
-------------------------- --------------------------
Its CEO Its Attorney-in-Fact
-------------------------- --------------------------
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EXHIBIT A
to
AIRCRAFT GENERAL TERMS AGREEMENT
AGTA-TLS
between
THE BOEING COMPANY
and
ATLAS AIR, INC.
BUYER FURNISHED EQUIPMENT PROVISIONS DOCUMENT
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BUYER FURNISHED EQUIPMENT PROVISIONS DOCUMENT
---------------
The parties acknowledge Boeing intends to implement a new Buyer Furnished
Equipment Process for Buyer Furnished Equipment in 1997. New documentation
reflecting the new process will be offered to Customers as soon as practicable.
It is the intention of the parties to replace this Exhibit when the new process
becomes available.
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BUYER FURNISHED EQUIPMENT PROVISIONS DOCUMENT
1. General.
Certain equipment to be installed in the Aircraft is furnished to Boeing by
Customer at Customer's expense. This equipment is designated "Buyer Furnished
Equipment" (BFE) and is listed in the Detail Specification. Boeing will provide
to Customer a BFE Requirements On-Dock/Inventory Document (BFE Document) or an
electronically transmitted BFE Report which may be periodically revised, setting
forth the items, quantities, on-dock dates and shipping instructions relating to
the in sequence installation of BFE as described in the applicable Supplemental
Exhibit to this Exhibit A in a purchase agreement at the time of aircraft
purchase.
2. Supplier Selection.
Customer will:
2.1. Select and notify Boeing of the suppliers of BFE items by those dates
appearing in Supplemental Exhibit BFE1to the applicable purchase agreement at
the time of aircraft purchase.
2.2. Meet with Boeing and such selected BFE suppliers promptly after such
selection to:
2.2.1 complete BFE configuration design requirements for such BFE; and
2.2.2 confirm technical data submittal dates for BFE certification.
3. Customer's Obligations.
Customer will:
3.1. comply with and cause the supplier to comply with the provisions of
the BFE Document or BFE Report;
3.1.1 deliver technical data (in English) to Boeing as required to
support installation and FAA certification in accordance with the schedule
provided by Boeing or as mutually agreed upon during the BFE meeting
referred to above;
3.1.2 deliver BFE including production and/or flight training spares
to Boeing in accordance with the quantities and schedule provided therein;
and
3.1.3 deliver appropriate quality assurance documentation to Boeing as
required with each BFE part (D6-56586, "BFE Product Acceptance
Requirements");
3.2. authorize Boeing to discuss all details of the BFE directly with the
BFE suppliers;
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3.3. authorize Boeing to conduct or delegate to the supplier quality source
inspection and supplier hardware acceptance of BFE at the supplier location;
3.3.1 require supplier's contractual compliance to Boeing defined
source inspection and supplier delegation programs, including availability
of adequate facilities for Boeing resident personnel; and
3.3.2 assure that Boeing identified supplier's quality systems be
approved to Boeing document D1-9000;
3.4. provide necessary field service representation at Boeing's facilities
to support Boeing on all issues related to the installation and certification of
BFE;
3.5. deal directly with all BFE suppliers to obtain overhaul data,
provisioning data, related product support documentation and any warranty
provisions applicable to the BFE;
3.6. work closely with Boeing and the BFE suppliers to resolve any
difficulties, including defective equipment, that arise;
3.7. be responsible for modifying, adjusting and/or calibrating BFE as
required for FAA approval and for all related expenses;
3.8. warrant that the BFE will meet the requirements of the Detail
Specification; and
3.9. be responsible for providing equipment which is FAA certifiable at
time of Aircraft delivery, or for obtaining waivers from the applicable
regulatory agency for non-FAA certifiable equipment.
4. Boeing's Obligations.
Other than as set forth below, Boeing will provide for the installation of
and install the BFE and obtain certification of the Aircraft with the BFE
installed.
5. Nonperformance by Customer.
If Customer's nonperformance of obligations in this Exhibit or in the BFE
Document causes a delay in the delivery of the Aircraft or causes Boeing to
perform out-of-sequence or additional work, Customer will reimburse Boeing for
all resulting expenses and be deemed to have agreed to any such delay in
Aircraft delivery. In addition Boeing will have the right to:
5.1. provide and install specified equipment or suitable alternate
equipment and increase the price of the Aircraft accordingly; and/or
5.2. deliver the Aircraft to Customer without the BFE installed.
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0. Return of Equipment.
BFE not installed in the Aircraft will be returned to Customer in
accordance with Customer's instructions and at Customer's expense.
7. Title and Risk of Loss.
Title to and risk of loss of BFE will at all times remain with Customer or
other owner. Boeing will have only such liability for BFE as a bailee for mutual
benefit would have, but will not be liable for loss of use.
8. Indemnification of Boeing.
Customer hereby indemnifies and holds harmless Boeing from and against all
claims and liabilities, including costs and expenses (including attorneys' fees)
incident thereto or incident to successfully establishing the right to
indemnification, for injury to or death of any person or persons, including
employees of Customer but not employees of Boeing, or for loss of or damage to
any property, including any Aircraft, arising out of or in any way connected
with any nonconformance or defect in any BFE and whether or not arising in tort
or occasioned by the negligence of Boeing. This indemnity will not apply with
respect to any nonconformance or defect caused solely by Boeing's installation
of the BFE.
9. Patent Indemnity.
Customer hereby indemnifies and holds harmless Boeing from and against all
claims, suits, actions, liabilities, damages and costs arising out of any actual
or alleged infringement of any patent or other intellectual property rights by
BFE or arising out of the installation, sale or use of BFE by Boeing.
10. Definitions.
For the purposes of the above indemnities, the term "Boeing" includes The
Boeing Company, its divisions, subsidiaries and affiliates, the assignees of
each, and their directors, officers, employees and agents.
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EXHIBIT B
to
AIRCRAFT GENERAL TERMS AGREEMENT
AGTA-TLS
between
THE BOEING COMPANY
and
ATLAS AIR, INC.
CUSTOMER SUPPORT DOCUMENT
This document contains:
Part 1: Maintenance and Flight Training Programs;
Operations Engineering Support
Part 2: Field Services and Engineering Support Services
Part 3: Technical Information and Materials
Part 4: Alleviation or Cessation of Performance
Part 5: Protection of Proprietary Information and
Proprietary Materials
B-i
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CUSTOMER SUPPORT DOCUMENT
PART 1: BOEING MAINTENANCE AND FLIGHT TRAINING
PROGRAMS; OPERATIONS ENGINEERING SUPPORT
1. Boeing Training Programs.
1.1. Boeing will provide maintenance training and flight training programs
to support the introduction of a specific model of aircraft into service. The
training programs will consist of general and specialized courses and will be
described in a Supplemental Exhibit to the applicable purchase agreement.
1.2. Boeing will conduct all training at Boeing's training facility in the
Seattle area unless otherwise agreed.
1.3. All training will be presented in the English language. If translation
is required, Customer will provide interpreters.
1.4. Customer will be responsible for all living expenses of Customer's
personnel. Boeing will transport Customer's personnel between their local
lodging and Boeing's training facility.
2. Training Planning Conferences.
Customer and Boeing will conduct planning conferences approximately 12
months before the scheduled delivery month of the first aircraft of a model to
define and schedule the maintenance and flight training programs.
3. Operations Engineering Support.
3.1. As long as an aircraft purchased by Customer from Boeing is operated
by Customer in scheduled revenue service, Boeing will provide operations
engineering support. Such support will include:
3.1.1 assistance with the analysis and preparation of performance data
to be used in establishing operating practices and policies for Customer's
operation of aircraft;
3.1.2 assistance with interpretation of the minimum equipment list,
the definition of the configuration deviation list and the analysis of
individual aircraft performance;
3.1.3 assistance with solving operational problems associated with
delivery and route-proving flights;
3.1.4 information regarding significant service items relating to
aircraft performance or flight operations; and
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3.1.5 if requested by Customer, Boeing will provide operations
engineering support during an aircraft ferry flight.
4. Training at a Facility Other Than Boeing's.
If requested by Customer, Boeing will conduct the classroom portions of the
maintenance and flight training (except for the Performance Engineer training
courses) at a mutually acceptable alternate training site, subject to the
following conditions:
4.1. Customer will provide acceptable classroom space, simulators (as
necessary for flight training) and training equipment required to present the
courses;
4.2. Customer will pay Boeing's then-current per diem charge for each
Boeing instructor for each day, or fraction thereof, that the instructor is away
from the Seattle area, including travel time;
4.3. Customer will reimburse Boeing for the actual costs of round-trip
transportation for Boeing's instructors and the shipping costs of training
Materials between the Seattle area and the alternate training site;
4.4. Customer will be responsible for all taxes, fees, duties, licenses,
permits and similar expenses incurred by Boeing and its employees as a result of
Boeing's providing training at the alternate site or incurred as a result of
Boeing providing revenue service training; and
4.5. Those portions of training that require the use of training devices
not available at the alternate site will be conducted at Boeing's facility or at
the alternate site.
5. General Terms and Conditions.
5.1. Boeing flight instructor personnel will not be required to work more
than 5 days per week, or more than 8 hours in any one 24-hour period, of which
not more than 5 hours per 8-hour workday will be spent in actual flying. These
foregoing restrictions will not apply to ferry assistance or revenue service
training services, which will be governed by FAA rules and regulations.
5.2. Normal Line Maintenance is defined as line maintenance that Boeing
might reasonably be expected to furnish for flight crew training at Boeing's
facility, and will include ground support and aircraft storage in the open, but
will not include provision of spare parts. Boeing will provide Normal Line
Maintenance services for any aircraft while the aircraft is used for flight crew
training at Boeing's facility. Customer will provide such services if flight
crew training is conducted elsewhere. Regardless of the location of such
training, Customer will be responsible for providing all maintenance items
(other than those included in Normal Line Maintenance) required during the
training, including, but not limited to, fuel, oil, landing fees and spare
parts.
5.3. If the training is based at Boeing's facility, and the aircraft is
damaged during such training, Boeing will make all necessary repairs to the
aircraft as promptly as possible. Customer will pay Boeing's reasonable charge,
including the price of parts and materials, for making the repairs. If Boeing's
estimated
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labor charge for the repair exceeds $25,000, Boeing and Customer will enter
into an agreement for additional services before beginning the repair work.
5.4. If the flight training is based at Boeing's facility, several airports
in the states of Washington, Montana and Oregon, as well as the services of the
fixed base operator at Grant County Airport at Moses Lake, Washington, may be
used. Unless otherwise agreed in the flight training planning conference, it
will be Customer's responsibility to make arrangements for the use of such
airports.
5.5. If Boeing agrees to make arrangements on behalf of Customer for the
use of airports for flight training, Boeing will pay on Customer's behalf any
landing fees charged by any airport used in conjunction with the flight
training. At least 30 days before flight training, Customer will provide Boeing
an open purchase order against which Boeing will invoice Customer for any
landing fees Boeing paid on Customer's behalf. The invoice will be submitted to
Customer approximately 60 days after flight training is completed, when all
landing fee charges have been received and verified. Customer will pay to Boeing
within 30 days of the date of the invoice.
5.6. If requested by Boeing, in order to provide the flight training or
ferry flight assistance, Customer will make available to Boeing an aircraft
after delivery to familiarize Boeing instructor or ferry flight crew personnel
with such aircraft. If flight of the aircraft is required for any Boeing
instructor or ferry flight crew member to maintain an FAA license for flight
proficiency or landing currency, Boeing will be responsible for the costs of
fuel, oil, landing fees and spare parts attributable to that portion of the
flight.
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CUSTOMER SUPPORT DOCUMENT
PART 2: FIELD AND ENGINEERING SUPPORT SERVICES
1. Field Service Representation.
Boeing will furnish field service representation to advise Customer with
respect to the maintenance and operation of an aircraft (Field Service
Representatives).
1.1. Field Service Representatives will be available at a facility
designated by Customer beginning before the scheduled delivery month of the
first aircraft and ending 12 months after delivery of the last aircraft covered
by a specific purchase agreement.
1.2. Customer will provide, at no charge to Boeing, suitable furnished
office space and office equipment at the location where Boeing is providing
Field Service Representatives. As required, Customer will assist each Field
Service Representative with visas, work permits, customs, mail handling,
identification passes and formal introduction to local airport authorities.
1.3. Boeing Field Service Representatives are assigned to various airports
around the world. Whenever Customer's aircraft are operating through any such
airport, the services of Boeing's Field Service Representatives are available to
Customer.
2. Engineering Support Services.
Boeing will, if requested by Customer, provide technical advisory
assistance for any aircraft and Boeing Product (as defined in Part I of Exhibit
C). Technical advisory assistance, provided from the Seattle area or at a base
designated by Customer as appropriate, will include:
2.1. Operational Problem Support. If Customer experiences operational
problems with an aircraft, Boeing will analyze the information provided by
Customer to determine the probable nature and cause of the problem and to
suggest possible solutions.
2.2. Schedule Reliability Support. If Customer is not satisfied with the
schedule reliability of a specific model of aircraft, Boeing will analyze
information provided by Customer to determine the nature and cause of the
problem and to suggest possible solutions.
2.3. Maintenance Cost Reduction Support. If Customer is concerned that
actual maintenance costs of a specific model of aircraft are excessive, Boeing
will analyze information provided by Customer to determine the nature and cause
of the problem and to suggest possible solutions.
2.4. Aircraft Structural Repair Support. If Customer is designing
structural repairs and desires Boeing's support, Boeing will analyze and comment
on Customer's engineering releases relating to structural repairs not covered by
Boeing's Structural Repair Manual.
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2.5. Aircraft Modification Support. If Customer is designing aircraft
modifications and requests Boeing's support, Boeing will analyze and comment on
Customer's engineering proposals for changes in, or replacement of, systems,
parts, accessories or equipment manufactured to Boeing's detailed design. Boeing
will not analyze or comment on any major structural change unless Customer's
request for such analysis and comment includes complete detailed drawings,
substantiating information (including any information required by applicable
government agencies), all stress or other appropriate analyses, and a specific
statement from Customer of the substance of the review and the response
requested.
2.6. Facilities, Ground Equipment and Maintenance Planning Support. Boeing
will, at Customer's request, evaluate Customer's technical facilities, tools and
equipment for servicing and maintaining aircraft, to recommend changes where
necessary and to assist in the formulation of an overall maintenance plan.
2.7. Post-Delivery Service Support. Boeing will, at Customer's request,
perform work on an aircraft after delivery but prior to the initial departure
flight or upon the return of the aircraft to Boeing's facility prior to
completion of that flight. In that event the following provisions will apply.
2.7.1 Boeing may rely upon the commitment authority of the Customer's
personnel requesting the work.
2.7.2 As title and risk of loss has passed to Customer, the insurance
provisions of Article 8.2 of the AGTA apply.
2.7.3 The provisions of the Boeing Warranty in Part 2 of Exhibit C of
this AGTA apply.
2.7.4 Customer will pay Boeing for requested work not covered by the
Boeing Warranty, if any.
2.7.5 The DISCLAIMER AND RELEASE and EXCLUSION OF CONSEQUENTIAL AND
OTHER DAMAGES provisions in Article 11 of Part 2 of Exhibit C of this AGTA
apply.
2.8. Additional Services. Boeing may, at Customer's request, provide
additional services for an aircraft after delivery, which may include retrofit
kit changes (kits and/or information), training, maintenance and repair of
aircraft. Such additional services will be subject to a mutually acceptable
price, schedule and scope of work. The DISCLAIMER AND RELEASE and the EXCLUSION
OF CONSEQUENTIAL AND OTHER DAMAGES provisions in Article 11 of Part 2 of Exhibit
C of this AGTA and the insurance provisions in Article 8.2 of this AGTA will
apply to any such work. Title to and risk of loss of any such aircraft will
always remain with Customer.
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CUSTOMER SUPPORT DOCUMENT
PART 3: TECHNICAL INFORMATION AND MATERIALS
1. General.
Materials are defined as any and all items that are created by Boeing or a
third party, which are provided directly or indirectly from Boeing and serve
primarily to contain, convey or embody information. Materials may include either
tangible embodiments (for example, documents or drawings), or intangible
embodiments (for example, software and other electronic forms) of information
but excludes Aircraft Software. Aircraft Software is defined as software that is
installed on and used in the operation of the aircraft.
Boeing will furnish to Customer certain Materials to support the
maintenance and operation of the aircraft at no additional charge to Customer,
except as otherwise provided herein. Such Materials will, if applicable, be
prepared generally in accordance with Air Transport Association of America (ATA)
Specification No. 100, entitled "Specification for Manufacturers' Technical
Data". Materials will be in English and in the units of measure used by Boeing
to manufacture an aircraft.
Digitally-produced Materials will, if applicable, be prepared generally in
accordance with ATA Specification No. 2100, dated January 1994, "Digital Data
Standards for Aircraft Support."
2. Materials Planning Conferences.
Customer and Boeing will conduct planning conferences approximately 12
months before the scheduled delivery month of the first aircraft of a model in
order to mutually determine the proper format and quantity of Materials to be
furnished to Customer in support of the aircraft.
When available, Customer may select Boeing standard digital format as the
delivery medium or, alternatively, Customer may select a reasonable quantity of
printed and 16mm microfilm formats. When Boeing standard digital format is
selected, Customer may also select up to 5 copies of printed or microfilm format
copies, with the exception of the Illustrated Parts Catalog, which will be
provided in one selected format only.
3. Information and Materials - Incremental Increase.
Until one year after the month of delivery of the last aircraft covered by
a specific purchase agreement, Customer may annually request in writing a
reasonable increase in the quantity of Materials with the exception of microfilm
master copies, digital formats, and others for which a specified number of
copies are provided. Boeing will provide the additional quantity at no
additional charge beginning with the next normal revision cycle. Customer may
request a decrease in revision quantities at any time.
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0. Advance Representative Copies.
All advance representative copies of Materials will be selected by Boeing
from available sources. Such advance copies will be for advance planning
purposes only.
5. Customized Materials.
All customized Materials will reflect the configuration of each aircraft as
delivered.
6. Revisions.
6.1. Revision Service. Boeing will provide revisions free of charge to
certain Materials to be identified in the planning conference conducted for a
specific model of aircraft, reflecting changes developed by Boeing, as long as
Customer operates an aircraft of that model.
6.2. Revisions Based on Boeing Service Bulletin Incorporation. If Boeing
receives written notice that Customer intends to incorporate, or has
incorporated, any Boeing service bulletin in an aircraft, Boeing will at no
charge issue revisions to Materials with revision service reflecting the effects
of such incorporation into such aircraft.
7. Computer Software Documentation for Boeing Manufactured Airborne Components
and Equipment.
Boeing will provide to Customer a Computer Software Index containing a
listing of (i) all programmed airborne avionics components and equipment
manufactured by Boeing or a Boeing subsidiary, designed and developed in
accordance with Radio Technical Commission for Aeronautics Document No.
RTCA/DO-178 dated January 1982, No. RTCA/DO-178A dated March 1985, or later as
available, and installed by Boeing in aircraft covered by the applicable
purchase agreement and (ii) specific software documents (Software Documentation)
available to Customer from Boeing for the listed components and equipment.
Two copies of the Computer Software Index will be furnished to Customer
with the first aircraft of a model. Revisions to the Computer Software Index
applicable to such model of aircraft will be issued to Customer as revisions are
developed by Boeing for so long as Customer operates the aircraft.
Software Documentation will be provided to Customer upon written request.
The charge to Customer for Software Documentation will be Boeing's price to
reproduce the Software Documentation requested. Software Documentation will be
prepared generally in accordance with ATA Specification No. 102 revised April
20, 1983, "Specification for Computer Software Manual" but Software
Documentation will not include, and Boeing will not be obligated to provide, any
code (including, but not limited to, original source code, assembled source
code, or object code) on computer sensible media.
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0. Supplier Technical Data.
8.1. For supplier-manufactured programmed airborne avionics components and
equipment classified as Seller Furnished Equipment (SFE) or Seller Purchased
Equipment (SPE) which contain computer software designed and developed in
accordance with Radio Technical Commission for Aeronautics Document No.
RTCA/DO-178 dated January 1982, No. RTCA/DO-178A dated March 1985, or later as
available, Boeing will request that each supplier of the components and
equipment make software documentation available to Customer in a manner similar
to that described in Article 7 above.
8.2. The provisions of this Article will not be applicable to items of BFE.
8.3. Boeing will furnish to Customer a document identifying the terms and
conditions of the product support agreements between Boeing and its suppliers
requiring the suppliers to fulfill Customer's requirements for information and
services in support of the specific model of aircraft.
9. Buyer Furnished Equipment Data.
Boeing will incorporate BFE information into the customized Materials
providing Customer makes the information available to Boeing at least nine
months prior to the scheduled delivery month of Customer's first aircraft of a
specific model. Customer agrees to furnish the information in Boeing standard
digital format if Materials are to be delivered in Boeing standard digital
format.
10. Materials Shipping Charges.
Boeing will pay the reasonable transportation costs of the Materials.
Customer is responsible for any customs clearance charges, duties, and taxes.
11. Customer's Shipping Address.
The Materials furnished to Customer hereunder are to be sent to a single
address to be specified. Customer will promptly notify Boeing of any change to
the address.
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CUSTOMER SUPPORT DOCUMENT
PART 4: ALLEVIATION OR CESSATION OF PERFORMANCE
Boeing will not be required to provide any Materials, services, training or
other things at a facility designated by Customer if any of the following
conditions exist:
1. a labor stoppage or dispute in progress involving Customer;
2. wars or warlike operations, riots or insurrections in the country
where the facility is located;
3. any condition at the facility which, in the opinion of Boeing, is
detrimental to the general health, welfare or safety of its personnel or
their families;
4. the United States Government refuses permission to Boeing personnel
or their families to enter into the country where the facility is located,
or recommends that Boeing personnel or their families leave the country; or
5. the United States Government refuses permission to Boeing to
deliver Materials, services, training or other things to the country where
the facility is located.
After the location of Boeing personnel at the facility, Boeing further
reserves the right, upon the occurrence of any of such events, to immediately
and without prior notice to Customer relocate its personnel and their families.
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CUSTOMER SUPPORT DOCUMENT
PART 5: PROTECTION OF PROPRIETARY INFORMATION
AND PROPRIETARY MATERIALS
1. General.
All Materials provided by Boeing to Customer and not covered by a Boeing
CSGTA or other agreement between Boeing and Customer defining Customer's right
to use and disclose the Materials and included information will be covered by,
and subject to the terms of this AGTA. Title to all Materials containing,
conveying or embodying confidential, proprietary or trade secret information
(Proprietary Information) belonging to Boeing or a third party (Proprietary
Materials), will at all times remain with Boeing or such third party. Customer
will treat all Proprietary Materials and all Proprietary Information in
confidence and use and disclose the same only as specifically authorized in this
AGTA.
2. License Grant.
Boeing grants to Customer a worldwide, non-exclusive, non-transferable
license to use and disclose Proprietary Materials in accordance with the terms
and conditions of this AGTA. Customer is authorized to make copies of Materials
(except for Materials bearing the copyright legend of a third party), and all
copies of Proprietary Materials will belong to Boeing and be treated as
Proprietary Materials under this AGTA. Customer will preserve all proprietary
legends, and all copyright notices on all Materials and insure the inclusion of
those legends and notices on all copies.
3. Use of Proprietary Materials and Proprietary Information.
Customer is authorized to use Proprietary Materials and Proprietary
Information for the purpose of: (a) operation, maintenance, repair, or
modification of Customer's aircraft for which the Proprietary Materials and
Proprietary Information have been specified by Boeing and (b) development and
manufacture of training devices for use by Customer.
4. Providing of Proprietary Materials to Contractors.
Customer is authorized to provide Proprietary Materials to Customer's
contractors for the sole purpose of maintenance, repair, or modification of
Customer's aircraft for which the Proprietary Materials have been specified by
Boeing. In addition, Customer may provide Proprietary Materials to Customer's
contractors for the sole purpose of developing and manufacturing training
devices for Customer's use. Before providing Proprietary Materials to its
contractor, Customer will first obtain a written agreement from the contractor
by which the contractor agrees (a) to use the Proprietary Materials only on
behalf of Customer, (b) to be bound by all of the restrictions and limitations
of this Part 5, and (c) that Boeing is a third party beneficiary under the
written agreement. Customer agrees to provide copies of all such written
agreements to Boeing upon request
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and be liable to Boeing for any breach of those agreements by a contractor. A
sample agreement acceptable to Boeing is attached as Appendix VII.
5. Providing of Proprietary Materials and Proprietary Information to
Regulatory Agencies.
When and to the extent required by a government regulatory agency having
jurisdiction over Customer or an aircraft, Customer is authorized to provide
Proprietary Materials and to disclose Proprietary Information to the agency for
use in connection with Customer's operation, maintenance, repair, or
modification of such aircraft. Customer agrees to take all reasonable steps to
prevent the agency from making any distribution, disclosure, or additional use
of the Proprietary Materials and Proprietary Information provided or disclosed.
Customer further agrees to notify Boeing immediately upon learning of any (a)
distribution, disclosure, or additional use by the agency, (b) request to the
agency for distribution, disclosure, or additional use, or (c) intention on the
part of the agency to distribute, disclose, or make additional use of
Proprietary Materials or Proprietary Information.
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EXHIBIT C
to
AIRCRAFT GENERAL TERMS AGREEMENT
AGTA-TLS
between
THE BOEING COMPANY
and
ATLAS AIR, INC.
PRODUCT ASSURANCE DOCUMENT
This document contains:
Part 1: Exhibit C Definitions
Part 2: Boeing Warranty
Part 3: Boeing Service Life Policy
Part 4: Supplier Warranty Commitment
Part 5: Boeing Interface Commitment
Part 6: Boeing Indemnities against Patent and Copyright
Infringement
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31
PRODUCT ASSURANCE DOCUMENT
PART 1: EXHIBIT C DEFINITIONS
Authorized Agent - Agent appointed by Customer to perform corrections and
to administer warranties (see Appendix VI to the AGTA for a form acceptable to
Boeing).
Average Direct Hourly Labor Rate - is the average hourly rate (excluding
all fringe benefits, premium-time allowances, social charges, business taxes and
the like) paid by Customer to its Direct Labor employees.
Boeing Product - any system, accessory, equipment, part or Aircraft
Software that is manufactured by Boeing or manufactured to Boeing's detailed
design with Boeing's authorization.
Correct - to repair, modify, provide modification kits or replace with a
new product.
Correction - a repair, a modification, a modification kit or a new product.
Corrected Boeing Product - a Boeing Product which is free of defect as a
result of a Correction.
Direct Labor - Labor spent by direct labor employees to remove,
disassemble, modify, repair, inspect and bench test a defective Boeing Product,
and to reassemble and reinstall a Corrected Boeing Product.
Direct Materials - Items such as parts, gaskets, grease, sealant and
adhesives, installed or consumed in performing a Correction, excluding
allowances for administration, overhead, taxes, customs duties and the like.
Source Control Drawing (SCD) - a Boeing document defining specifications
for certain Supplier Products.
Supplier - the manufacturer of a Supplier Product.
Supplier Product - any system, accessory, equipment, part or Aircraft
Software that is not manufactured to Boeing's detailed design. This includes but
is not limited to parts manufactured to a SCD, all standards, and other parts
obtained from non-Boeing sources.
Warranty Inspections - inspections of Boeing Products performed during the
warranty period that are recommended by a service bulletin or service letter.
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PRODUCT ASSURANCE DOCUMENT
PART 2: BOEING WARRANTY
1. Warranty Applicability.
This warranty applies to all Boeing Products. Warranties applicable to
Supplier Products are in Part 4. Warranties applicable to engines will be
provided by Supplemental Exhibits to individual purchase agreements.
2. Warranty.
2.1. Coverage. Boeing warrants that at the time of aircraft delivery:
(i) the aircraft will conform to the Detail Specification except for
portions stated to be estimates, approximations or design objectives;
(ii) all Boeing Products in the aircraft will be free from defects in
material and workmanship, including process of manufacture;
(iii) all Boeing Products in the aircraft will be free from defects in
design, including selection of materials and the process of manufacture, in
view of the state of the art at the time of design, and
(iv) the workmanship utilized to install Supplier Products, engines
and BFE will be free from defects.
2.2. Exceptions. The following conditions do not constitute a defect under
this warranty:
(i) conditions resulting from normal wear and tear;
(ii) conditions resulting from acts or omissions of Customer; and
(iii) conditions resulting from failure to properly service and
maintain the aircraft.
3. Warranty Periods.
3.1. Warranty. The warranty period begins on the date of aircraft delivery
and expires 48 months thereafter, except for the models of aircraft listed
below, for which models the warranty period is 36 months.
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-------------------
36 months
-------------------
737-300
737-400
737-500
757-200
757-300
767-200
767-300
767-400
747-400
-------------------
3.2. Warranty on Corrected Boeing Products. The warranty period applicable
to a Corrected Boeing Product, including the workmanship to Correct and install,
resulting from a defect in material or workmanship is the remainder of the
warranty period for the defective Boeing Product it replaced. The warranty
period for a Corrected Boeing Product resulting from a defect in design is 18
months or the remainder of the initial warranty period, whichever is longer. The
18 month period begins on the date of delivery of the Corrected Boeing Product
or date of delivery of the kit or kits furnished to Correct the Boeing Product.
3.3. Survival of Warranties. All warranty periods are stated above. The
Performance Guarantees will not survive delivery of the aircraft.
4. Remedies.
4.1. Defect Correction. At Customer's option, Boeing will either Correct or
reimburse Customer to Correct defects in Boeing Products discovered during the
warranty period.
4.2. Warranty Labor Rate. If Customer or its Authorized Agent Corrects a
defective Boeing Product, reimbursement to Customer for Direct Labor Hours will
be provided at Customer's established Warranty Labor Rate. Customer's
established Warranty Labor Rate will be the greater of the standard labor rate
or 150% of Customer's Average Direct Hourly Rate. The standard labor rate paid
by Boeing to its customers is established and published annually. Prior to or
concurrently with submittal of Customer's first claim for Direct Labor
reimbursement, Customer will notify Boeing of Customer's then-current average
direct hourly labor rate, and thereafter notify Boeing of any material change in
such rate. Boeing will require information from Customer to substantiate such
rates.
4.3. Warranty Inspections. In addition to the remedies to Correct defects
in Boeing Products, Boeing will reimburse Customer for cost of Direct Labor to
perform certain inspections of the aircraft to determine whether or not a
covered defect exists in a Boeing Product, provided:
4.3.1 the inspections are recommended by a service bulletin or service
letter issued by Boeing during the warranty period; and
4.3.2 such reimbursement will not apply to any inspections performed
after a Correction is available to Customer.
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4.4. Credit Memorandum Reimbursement. Boeing will make all reimbursements
by credit memoranda which may be applied toward the purchase of Boeing goods and
services.
4.5. Maximum Reimbursement. Unless previously agreed, the maximum
reimbursement for Direct Labor and Direct Materials used to Correct a defective
Boeing Product will not exceed 65% of Boeing's then-current sales price for a
new replacement Boeing Product.
5. Discovery and Notice.
5.1. For a claim to be valid:
(i) the defect must be discovered during the warranty period; and
(ii) Boeing Product Assurance Contracts must receive written notice of
the discovery no later than 90 days after expiration of the warranty
period. The notice must include sufficient information to substantiate the
claim.
5.2. Receipt of Customer's notice of the discovery of a defect secures
Customer's rights to remedies under this Exhibit C, whether or not Customer has
performed the Correction at the time of the notice.
5.3. Once Customer has given valid notice of the discovery of a defect,
claims may be submitted at any time after performance of the Correction.
5.4. Boeing may release service bulletins or service letters advising
Customer of the availability of certain warranty remedies. When such advice is
provided, Customer will be deemed to have fulfilled the requirements for
discovery of the defect and submittal of notice under this Exhibit C as of the
date specified in the service bulletin or service letter.
6. Filing a Claim.
6.1. Authority to File. Claims may be filed by Customer or the Authorized
Agent that Customer appoints to act on Customer's behalf. Such appointment will
only be effective upon Boeing's receipt of the Authorized Agent's express
written agreement, in a form satisfactory to Boeing, to be bound by and to
comply with all applicable terms and conditions of this Aircraft General Terms
Agreement.
6.2. Claim Information.
6.2.1 Claimant is responsible for providing sufficient information
to substantiate Customer's rights to remedies under this Exhibit C. Boeing may
reject a claim for lack of sufficient information. At a minimum, such
information must include:
(i) identity of claimant;
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(ii) serial or block number of the aircraft on which the defective
Boeing Product was delivered;
(iii) part number of defective Boeing Product;
(iv) purchase order number and date of delivery of a spare part
(v) description and substantiation of defect; and
(vi) date the defect was discovered.
6.2.2 Additional information may be required based on the nature of
the defect and the remedies requested.
6.3. Boeing Claim Processing.
6.3.1 All claims must be signed and submitted directly by Customer
or its Authorized Agent to Boeing Product Assurance Contracts.
6.3.2 Boeing will promptly review the claim and will give
notification of claim approval or rejection. If the claim is rejected, Boeing
will provide a written explanation.
7. Limited Warranty for Certain Materials.
7.1. Boeing warrants that, at the time of delivery, all Materials created
by Boeing will be free from errors and defects in media. In the case where such
Materials are provided by on-line electronic access, media is the digital format
transmitted from Boeing.
7.2. Warranty Periods and Claims. The warranty period with respect to an
error or a defect in any Materials created by Boeing begins at delivery of the
Materials in which the error or defect is discovered and ends 48 months after
delivery of the Materials.
The claimed error or defect must become apparent to Customer within the
applicable warranty period, and the Boeing Product Assurance Regional Manager
must receive written notice of such error or defect at the earliest practicable
time after the error or defect becomes apparent to Customer, but in no event
later than 90 days after expiration of the applicable warranty period.
7.3. Remedy. Customer's remedy for an error or a defect in media is
replacement of the erroneous or defective Materials created by Boeing with
Materials free from such error or defect.
8. Corrections Performed by Customer.
8.1. Facilities Requirements. Customer may at its option Correct defective
Boeing Products at its facilities or may subcontract Corrections to a third
party contractor or an Authorized Agent.
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8.2. Technical Requirements. All Corrections done by Customer, a third
party contractor or Customer's Authorized Agent must be performed in accordance
with Boeing's applicable service manuals, bulletins or other written
instructions, using parts and materials furnished or approved by Boeing.
8.3. Reimbursement.
8.3.1 Boeing will reimburse for reasonable costs of Direct Materials
and Direct Labor (excluding time expended for normal overhaul) at Customer's
Warranty Labor Rate to Correct a defective Boeing Product. Claims for
reimbursement must contain sufficient information to substantiate Direct Labor
hours expended and Direct Materials consumed. Customer, the third party
contractor, or Customer's Authorized Agent may be required to produce invoices
for materials.
8.3.2 Reimbursement for Direct Labor hours to perform Corrections
stated in a service bulletin will be based on the labor estimates in the
service bulletin.
8.3.3 Boeing will reimburse Customer for freight charges associated
with Corrections performed by a third party contractor or Customer's Authorized
Agent.
8.4. Disposition of Defective Boeing Products Beyond Economical Repair.
8.4.1 Defective Boeing Products that are found to be beyond
economical repair will be retained for a period of 60 days from the date Boeing
receives Customer's claim. Boeing may request return of such Boeing Products
during the 60 day period for inspection and confirmation of a defect.
8.4.2 After the 60 day period, a defective Boeing Product with a
value of U.S. $2000 or less may be scrapped without notification to Boeing. If
such Product has a value greater than U.S. $2000, Customer must obtain
confirmation of unrepairability by Boeing's on-site Customer Services
Representative prior to scrapping. Confirmation may be in the form of the
Representative's signature on Customer's claim or through direct communication
between the Representative and Boeing Product Assurance Contracts.
9. Corrections Performed by Boeing.
9.1. Freight Charges. Customer will pay shipping charges to return a
defective Boeing Product to Boeing. Boeing will reimburse Customer for the
charge for any item determined to be defective under this Aircraft General Terms
Agreement. Boeing will pay shipping charges to return the Corrected Boeing
Product.
9.2. Customer Instructions. The documentation shipped with the returned
defective Boeing Product may include specific technical instructions for work to
be performed on the Boeing Product. The absence of such instructions will
evidence Customer's authorization for Boeing to proceed to perform all necessary
Corrections and work required to return the Boeing Product to a serviceable
condition.
9.3. Correction Time Objectives.
9.3.1 Boeing's objective for making Corrections is 10 working days
for avionics and electronic Boeing Products, 30 working days for Corrections of
other Boeing Products performed at Boeing's fa-
C-2-5
37
cilities, and 40 working days for Corrections of other Boeing Products
performed at a Boeing subcontractor's facilities. The objectives are measured
from the date Boeing receives the defective Boeing Product and a valid claim to
the date Boeing ships the Correction.
9.3.2 If Customer has a critical parts shortage because Boeing has
exceeded a Correction time objective and Customer has procured spare Boeing
Products for the defective Boeing Product in quantities shown in Boeing's
Recommended Spare Parts List (RSPL), then Boeing will either expedite the
Correction or provide a similar Product on a no charge loan or lease basis
until a Corrected Boeing Product is returned.
9.4. Title Transfer and Risk of Loss.
9.4.1 Title to and risk of loss of any Boeing Product returned to
Boeing will at all times remain with Customer or any other title holder of such
Boeing Product. While Boeing has possession of the returned Boeing Product,
Boeing will have only such liabilities as a bailee for mutual benefit would
have, but will not be liable for loss of use.
9.4.2 If a Correction requires shipment of a new Boeing Product, then
at the time Boeing ships the new Boeing Product, title to and risk of loss for
the returned Boeing Product will pass to Boeing, and title to and risk of loss
for the new Boeing Product will pass to Customer.
10. Returning an Aircraft.
10.1. Conditions. An aircraft may be returned to Boeing's facilities for
Correction only if:
(i) Boeing and Customer agree a defect exists;
(ii) Customer lacks access to adequate facilities, equipment or
qualified personnel to perform the Correction; and
(iii) it is not practical, in Boeing's estimation, to dispatch Boeing
personnel to perform the Correction at a remote site.
10.2. Correction Costs. Boeing will perform the Correction at no charge to
Customer. Subject to the conditions of Article 9.1, Boeing will reimburse
Customer for the costs of fuel, oil and landing fees incurred in ferrying the
aircraft to Boeing and back to Customer's facilities. Customer will minimize the
length of both flights.
10.3. Separate Agreement. Boeing and Customer will enter into a separate
agreement covering return of the aircraft and performance of the Correction.
Authorization by Customer for Boeing to perform additional work that is not part
of the Correction must be received within 24 hours of Boeing's notification. If
such authorization is not received within 24 hours, Customer may be invoiced for
work performed by Boeing that is not part of the Correction.
C-2-6
38
11. Insurance.
The provisions of Article 8.2 "Insurance", of the AGTA, will apply to any work
performed by Boeing in accordance with Customer's specific technical
instructions, to the extent any legal liability of Boeing is based upon the
content of such instructions.
12. Disclaimer and Release; Exclusion of Liabilities.
12.1. DISCLAIMER AND RELEASE. THE WARRANTIES, OBLIGATIONS AND LIABILITIES
OF BOEING AND THE REMEDIES OF CUSTOMER IN THIS EXHIBIT C ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND CUSTOMER HEREBY WAIVES, RELEASES AND RENOUNCES, ALL OTHER
WARRANTIES, OBLIGATIONS AND LIABILITIES OF BOEING AND ALL OTHER RIGHTS, CLAIMS
AND REMEDIES OF CUSTOMER AGAINST BOEING, EXPRESS OR IMPLIED, ARISING BY LAW OR
OTHERWISE, WITH RESPECT TO ANY NONCONFORMANCE OR DEFECT IN ANY AIRCRAFT,
MATERIALS, TRAINING, SERVICES OR OTHER THING PROVIDED UNDER THIS AGTA AND THE
APPLICABLE PURCHASE AGREEMENT, INCLUDING, BUT NOT LIMITED TO:
(A) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;
(B) ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF
DEALING OR USAGE OF TRADE;
(C) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT, WHETHER OR
NOT ARISING FROM THE NEGLIGENCE OF BOEING; AND
(D) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OF OR
DAMAGE TO ANY AIRCRAFT.
12.2. EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES. BOEING WILL HAVE NO
OBLIGATION OR LIABILITY, WHETHER ARISING IN CONTRACT (INCLUDING WARRANTY), TORT,
WHETHER OR NOT ARISING FROM THE NEGLIGENCE OF BOEING, OR OTHERWISE, FOR LOSS OF
USE, REVENUE OR PROFIT, OR FOR ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES
WITH RESPECT TO ANY NONCONFORMANCE OR DEFECT IN ANY AIRCRAFT, MATERIALS,
TRAINING, SERVICES OR OTHER THING PROVIDED UNDER THIS AGTA AND THE APPLICABLE
PURCHASE AGREEMENT.
12.3. Contribution Toward Third-Party Damage. Claims by Customer against
Boeing for contribution for all costs incurred by Customer arising directly or
indirectly from third-party claims, to the extent of Boeing's relative
percentage of the total fault or other legal responsibility of all persons
causing such bodily injuries or property damage, are excepted from the terms of
paragraphs 12.1 and 12.2.
12.4. Definitions. For the purpose of this Article, "BOEING" or "Boeing" is
defined as The Boeing Company, its divisions, subsidiaries, affiliates, the
assignees of each, and their respective directors, officers, employees and
agents.
C-2-7
39
PRODUCT ASSURANCE DOCUMENT
PART 3: BOEING SERVICE LIFE POLICY
1. Definitions.
SLP Component - any of the primary structural elements (excluding industry
standard parts) of the landing gear, wing, fuselage, vertical or horizontal
stabilizer listed in the applicable purchase agreement for a specific model of
aircraft that is installed in the aircraft at time of delivery or is purchased
from Boeing by Customer as a spare part. The detailed SLP Component listing will
be in Supplemental Exhibit SLP1 to each Purchase Agreement.
2. Service Life Policy.
2.1. SLP Commitment. If a failure or defect is discovered in a SLP
Component within the time periods specified in Article 2.2 below, Boeing will,
at a price calculated pursuant to Article 3 below, Correct the SLP Component.
2.2. SLP Policy Periods.
2.2.1 The policy period for SLP Components initially installed on an
aircraft is 12 years after the date of delivery of the aircraft.
2.2.2 The policy period for SLP Components purchased from Boeing by
Customer as spare parts is 12 years from delivery of such SLP Component or 12
years from the date of delivery of the last aircraft produced by Boeing of a
specific model, whichever first expires.
2.3. Price.
The price that Customer will pay for the Correction of a defective or
failed SLP Component will be calculated pursuant to the following formula:
P = CT
---
144
where:
P = price to Customer
C = SLP Component sales price at time of Correction
T = total age in months of the defective or
failed SLP Component from the date of
delivery to Customer to the date of
discovery of such condition.
C-3-1
40
3. Conditions.
Boeing's obligations under this Policy are conditioned upon the following:
3.1. Customer must notify Boeing in writing of the defect or failure within
three months after it becomes apparent.
3.2. Customer must provide reasonable evidence that the claimed defect or
failure is covered by this Policy and if requested by Boeing, that such defect
or failure was not the result of (i) a defect or failure in a component not
covered by this Policy, (ii) an extrinsic force, (iii) an act or omission of
Customer, or (iv) operation or maintenance contrary to applicable governmental
regulations or Boeing's instructions.
3.3. If return of a defective or failed SLP Component is practicable and
requested by Boeing, Customer will return such SLP Component to Boeing at
Boeing's expense.
3.4. Customer's rights and remedies under this Policy are limited to the
receipt of a Correction at prices calculated pursuant to Article 3 above.
4. Disclaimer and Release; Exclusion of Liabilities.
This Part 3 and the rights and remedies of Customer and the obligations of
Boeing are subject to the DISCLAIMER AND RELEASE and EXCLUSION OF CONSEQUENTIAL
AND OTHER DAMAGES provisions of Article 11 of Part 2 of this Exhibit C.
C-3-2
41
PRODUCT ASSURANCE DOCUMENT
PART 4: SUPPLIER WARRANTY COMMITMENT
1. Supplier Warranties and Supplier Patent Indemnities.
Boeing will use diligent efforts to obtain warranties and indemnities
against patent infringement enforceable by Customer from Suppliers of Supplier
Products (except for engines) installed on the aircraft at the time of delivery
that were selected and purchased by Boeing, but not manufactured to Boeing's
detailed design. Boeing will furnish copies of the warranties and patent
indemnities to Customer in Boeing Document D6-56115, Product Support and Product
Assurance Supplier Defined Equipment Information, prior to the scheduled
delivery month of the first aircraft under the initial purchase agreement to the
AGTA.
2. Boeing Assistance in Administration of Supplier Warranties.
Customer will be responsible for submitting warranty claims directly to
Suppliers; however, if Customer experiences problems enforcing any Supplier
warranty obtained by Boeing for Customer, Boeing will conduct an investigation
of the problem and assist Customer in the resolution of those claims.
3. Boeing Support in Event of Supplier Default.
3.1. If the Supplier defaults in the performance of a material obligation
under its warranty, and Customer provides evidence to Boeing that a default has
occurred, then Boeing will furnish the equivalent warranty terms as provided by
the defaulting Supplier.
3.2. At Boeing's request, Customer will assign to Boeing, and Boeing will
be subrogated to, its rights against the Supplier provided by the Supplier
warranty.
C-4-1
42
PRODUCT ASSURANCE DOCUMENT
PART 5: BOEING INTERFACE COMMITMENT
1. Interface Problems.
An Interface Problem is defined as a technical problem in the operation of
an aircraft or its systems experienced by Customer, the cause of which is not
readily identifiable by Customer but which Customer believes to be attributable
to the design characteristics of the aircraft or its systems. In the event
Customer experiences an Interface Problem, Boeing will, without additional
charge to Customer, promptly conduct an investigation and analysis to determine
the cause or causes of the Interface Problem. Boeing will promptly advise
Customer at the conclusion of its investigation of Boeing's opinion as to the
causes of the Interface Problem and Boeing's recommendation as to corrective
action.
2. Boeing Responsibility.
If Boeing determines that the Interface Problem is primarily attributable
to the design of any Boeing Product, Boeing will Correct the design to the
extent of any then-existing obligations of Boeing under the provisions of the
applicable Boeing Warranty or Boeing Service Life Policy.
3. Supplier Responsibility.
If Boeing determines that the Interface Problem is primarily attributable
to the design of a Supplier Product, Boeing will assist Customer in processing a
warranty claim against the Supplier.
4. Joint Responsibility.
If Boeing determines that the Interface Problem is partially attributable
to the design of a Boeing Product and partially to the design of a Supplier
Product, Boeing will seek a solution to the Interface Problem through the
cooperative efforts of Boeing and the Supplier and will promptly advise Customer
of the resulting corrective actions and recommendations.
5. General.
Customer will, if requested by Boeing, assign to Boeing any of its rights
against any supplier as Boeing may require to fulfill its obligations hereunder.
C-5-1
43
6. Disclaimer and Release; Exclusion of Liabilities.
This Part 5 and the rights and remedies of Customer and the obligations of
Boeing herein are subject to the DISCLAIMER AND RELEASE and EXCLUSION OF
CONSEQUENTIAL AND OTHER DAMAGES provisions of Article 11 of Part 2 of this
Exhibit C.
C-5-2
44
PRODUCT ASSURANCE DOCUMENT
PART 6: BOEING INDEMNITIES AGAINST PATENT
AND COPYRIGHT INFRINGEMENT
1. Indemnity Against Patent Infringement.
Boeing will defend and indemnify Customer with respect to all claims, suits
and liabilities arising out of any actual or alleged patent infringement through
Customer's use, lease or resale of any aircraft or any Boeing Product installed
on an aircraft at delivery.
2. Indemnity Against Copyright Infringement.
Boeing will defend and indemnify Customer with respect to all claims, suits
and liabilities arising out of any actual or alleged copyright infringement
through Customer's use, lease or resale of any Boeing created Aircraft Software
installed on an aircraft at delivery.
3. Exceptions, Limitations and Conditions.
3.1. Boeing's obligation to indemnify Customer for patent infringement will
extend only to infringements in countries which, at the time of the
infringement, were party to and fully bound by either (a) Article 27 of the
Chicago Convention on International Civil Aviation of December 7, 1944, or (b)
the International Convention for the Protection of Industrial Property (Paris
Convention).
3.2. Boeing's obligation to indemnify Customer for copyright infringement
is limited to infringements in countries which, at the time of the infringement,
are members of The Berne Union and recognize computer software as a "work" under
The Berne Convention.
3.3. The indemnities provided under this Part 6 will not apply to any (i)
BFE, (ii) engines, (iii) Supplier Product (iv) Boeing Product used other than
for its intended purpose, or (v) Aircraft Software not created by Boeing.
3.4. Customer must deliver written notice to Boeing (i) within 10 days
after Customer first receives notice of any suit or other formal action against
Customer and (ii) within 20 days after Customer first receives any other
allegation or written claim of infringement covered by this Part 6.
3.5. At any time, Boeing will have the right at its option and expense to:
(i) negotiate with any party claiming infringement, (ii) assume or control the
defense of any infringement allegation, claim, suit or formal action, (iii)
intervene in any infringement suit or formal action , and/or (iv) attempt to
resolve any claim of infringement by replacing an allegedly infringing Boeing
Product or Aircraft Software with a noninfringing equivalent.
C-6-1
45
3.6. Customer will promptly furnish to Boeing all information, records and
assistance within Customer's possession or control which Boeing considers
relevant or material to any alleged infringement covered by this Part 6.
3.7. Except as required by a final judgment entered against Customer by a
court of competent jurisdiction from which no appeals can be or have been filed,
Customer will obtain Boeing's written approval prior to paying, committing to
pay, assuming any obligation or making any material concession relative to any
infringement covered by these indemnities.
3.8. BOEING WILL HAVE NO OBLIGATION OR LIABILITY UNDER THIS PART 6 FOR LOSS
OF USE, REVENUE OR PROFIT, OR FOR ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES.
THE OBLIGATIONS OF BOEING AND REMEDIES OF CUSTOMER IN THIS PART 6 ARE EXCLUSIVE
AND IN SUBSTITUTION FOR, AND CUSTOMER HEREBY WAIVES, RELEASES AND RENOUNCES ALL
OTHER INDEMNITIES, OBLIGATIONS AND LIABILITIES OF BOEING AND ALL OTHER RIGHTS,
CLAIMS AND REMEDIES OF CUSTOMER AGAINST BOEING, EXPRESS OR IMPLIED, ARISING BY
LAW OR OTHERWISE, WITH RESPECT TO ANY ACTUAL OR ALLEGED PATENT, COPYRIGHT OR
OTHER INTELLECTUAL PROPERTY INFRINGEMENT OR THE LIKE BY ANY AIRCRAFT, BOEING
PRODUCT, AIRCRAFT SOFTWARE, MATERIALS, TRAINING, SERVICES OR OTHER THING
PROVIDED UNDER THIS AGTA AND THE APPLICABLE PURCHASE AGREEMENT.
3.9. For the purposes of this Part 6, "BOEING or Boeing" is defined as The
Boeing Company, its divisions, subsidiaries, affiliates, the assignees of each
and their respective directors, officers, employees and agents.
X-0-0
00
XXXXXXX X
to
AIRCRAFT GENERAL TERMS AGREEMENT
AGTA-TLS
between
THE BOEING COMPANY
and
ATLAS AIR, INC.
ESCALATION ADJUSTMENT
AIRFRAME AND OPTIONAL FEATURES
(For Model 737-600, 737-700 and 737-800, Airframe
Price Includes the Engine Price)
D-i
47
EXHIBIT D
ESCALATION ADJUSTMENT
1. Formula.
Airframe and Optional Features price adjustments (Airframe Price
Adjustment); are used to allow prices to be stated in current year dollars at
the signing of the applicable purchase agreement and to adjust the amount to be
paid by Customer at delivery for the effects of economic fluctuation. The
Airframe Price Adjustment will be determined at the time of aircraft delivery in
accordance with the following formula:
P(a) = (P)(L + M - 1)
Where:
P(a) = Airframe Price Adjustment. (For Model 737-600,
737-700 and 737-800, the Airframe Price includes the
Engine Price.)
L = .65 x ECI
base year index (as set forth in Table 1 of
the applicable purchase agreement)
M = .35 x ICI base year index
(as set forth in Table 1 of the applicable
purchase agreement)
P = Airframe Price plus Optional Features Price (as set
forth in the applicable purchase agreement).
ECI is a value determined using the U.S. Department of Labor, Bureau of
Labor Statistics "Employment Cost Index for workers in aerospace
manufacturing" (ECI code 3721), calculated by establishing a
three-month arithmetic average value (expressed as a decimal and
rounded to the nearest tenth) using the values for the fifth, sixth and
seventh months prior to the month of scheduled delivery of the
applicable aircraft. As the Employment Cost Index values are only
released on a quarterly basis, the value released for the month of
March will be used for the months of January and February; the value
for June used for April and May; the value for September used for July
and August; and the value for December used for October and November.
ICI is a value determined using the U.S. Department of Labor, Bureau of
Labor Statistics "Producer Prices and Price Index - Industrial
Commodities Index ", calculated as a 3-month arithmetic average of the
released monthly values (expressed as a decimal and rounded to the
nearest tenth) using the values for the 5th, 6th and 7th months prior
to the month of scheduled delivery of the applicable aircraft.
D-1
48
As an example, for an aircraft scheduled to be delivered in the month
of January, the months June, July and August of the preceding year will
be utilized in determining the value of ECI and ICI.
Note: i. In determining the values of L and M, all calculations and
resulting values will be expressed as a decimal rounded to the
nearest ten-thousandth.
ii. .65 is the numeric ratio attributed to labor in the Airframe Price
Adjustment formula.
iii. .35 is the numeric ratio attributed to materials in the Airframe
Price Adjustment formula.
iv. The denominators (base year indices) are the actual average values
reported by the U.S. Department of Labor, Bureau of Labor
Statistics (base year June 1989 = 100). The applicable base year
and corresponding denominator will be provided by Boeing in the
applicable purchase agreement.
2. Values to be Utilized in the Event of Unavailability.
2.1. If the Bureau of Labor Statistics substantially revises the
methodology used for the determination of the values to be used to determine the
ECI and ICI values (in contrast to benchmark adjustments or other corrections of
previously released values), or for any reason has not released values needed to
determine the applicable Airframe Price Adjustment, the parties will, prior to
the delivery of any such aircraft, select a substitute from other Bureau of
Labor Statistics data or similar data reported by non-governmental
organizations. Such substitute will result in the same adjustment, insofar as
possible, as would have been calculated utilizing the original values adjusted
for fluctuation during the applicable time period. However, if within 24 months
after delivery of the aircraft, the Bureau of Labor Statistics should resume
releasing values for the months needed to determine the Airframe Price
Adjustment, such values will be used to determine any increase or decrease in
the Airframe Price Adjustment for the aircraft from that determined at the time
of delivery of the aircraft.
2.2. Notwithstanding Article 2.1 above, if prior to the scheduled delivery
month of an aircraft the Bureau of Labor Statistics changes the base year for
determination of the ECI and ICI values as defined above, such re-based values
will be incorporated in the Airframe Price Adjustment calculation.
2.3. In the event escalation provisions are made non-enforceable or
otherwise rendered void by any agency of the United States Government, the
parties agree, to the extent they may lawfully do so, to equitably adjust the
Purchase Price of any affected aircraft to reflect an allowance for increases or
decreases in labor compensation and material costs occurring since February,
1995, which is consistent with the applicable provisions of paragraph 1 of this
Exhibit D.
Note: i. The values released by the Bureau of Labor Statistics and available
to Boeing 30 days prior to the scheduled delivery month of an
aircraft will be used to determine the ECI and ICI values for the
applicable months (including those noted as preliminary by the
Bureau of Labor Statistics) to calculate the Airframe Price
Adjustment for the aircraft invoice at the time of delivery. The
values will be considered final and no Aircraft Price Adjustments
will be made after Aircraft delivery for any subsequent changes in
published Index values.
D-2
49
ii. The maximum number of digits utilized in any part of the Airframe
Price Adjustment equation will be 4, where rounding of the fourth
digit will be increased to the next highest digit when the 5th digit
is equal to 5 or greater.
D-3
50
SAMPLE
Insurance Certificate
BROKER'S LETTERHEAD
[ date ]
Certificate of Insurance
ISSUED TO: The Boeing Company
Post Office Box 3707
Mail Stop 13-57
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Manager - Aviation Insurance for
Vice President - Employee Benefits,
Insurance and Taxes
CC: Boeing Commercial Airplane Group
X.X. Xxx 0000
Mail Stop 75-38
Xxxxxxx, Xxxxxxxxxx 00000-0000
X.X.X.
Attn: Vice President - Contracts
NAMED INSURED: #
We hereby certify that in our capacity as Brokers to the Named Insured, the
following described insurance is in force on this date:
Insurer Policy No. Participation
POLICY PERIOD: From [date and time of inception of the Policy(ies)]
to [date and time of expiration].
GEOGRAPHICAL LIMITS: Worldwide (however, as respects "Aircraft Hull War
and Allied Perils" Insurance, as agreed by Boeing).
AIRCRAFT INSURED: All Boeing manufactured aircraft owned or operated by
the Named insured which are the subject of the follow-
ing purchase agreement(s), entered into between The
Boeing Company and _________________ (hereinafter
"Aircraft"):
Purchase Agreement No. ____ dated ______
Purchase Agreement No. ____ dated ______
App. I-1
51
COVERAGES:
1. Aircraft "all risks" Hull (Ground and Flight)
2. Aircraft Hull War and Allied Perils (as per LSW 555, or its successor
wording)
3. Airline Liability
Including, but not limited to, Bodily Injury, Property Damage, Aircraft
Liability, Liability War Risks, Passenger Legal Liability, Premises/Operations
Liability, Completed Operations/Products Liability, Baggage Legal Liability
(checked and unchecked), Cargo Legal Liability, Contractual Liability and
Personal Injury.
The above-referenced Airline Liability insurance coverage is subject to War and
Other Perils Exclusion Clause (AV48B) but all sections, other than section (b)
are reinstated as per AV52C, or their successor endorsements. LIMITS OF
LIABILITY: To the fullest extent of the Policy limits that the Named Insured
carries from the time of delivery of the first Aircraft under the first Purchase
Agreement listed under "Aircraft Insured" and thereafter at the inception of
each policy period, but in any event no less than the following:
Combined Single Limit Bodily Injury and Property Damage: U.S.$ any one
occurrence each Aircraft (with aggregates as applicable).
(737 500/600) US$350,000,000
(737 300/700) US$400,000,000
(737 400) US$450,000,000
(737 800) US$500,000,000
(757 200) US$450,000,000
(757 300) US$550,000,000
(767 200) US$550,000,000
(767 300) US$700,000,000
(777 200/300) US$800,000,000
(747 400) US$900,000,000
(747 400F) US$600,000,000
(In regard to all other models and/or derivatives, to be specified by Boeing).
(In regard to Personal Injury coverage, limits are US$25,000,000 any one
offense/aggregate.)
DEDUCTIBLES / SELF-INSURANCE:
Any deductible and/or self-insurance amount (other than standard market
deductibles) are to be disclosed and agreed by Boeing.
App-I-2
52
SAMPLE
Insurance Certificate
SPECIAL PROVISIONS APPLICABLE TO BOEING:
It is certified that Insurers are aware of the terms and conditions of the
Aircraft General Terms Agreement AGTA/(________) and the following purchase
agreements:
PA ______ dated _______
PA ______ dated _______
PA ______ dated _______
Each Aircraft manufactured by Boeing which is delivered to the Insured pursuant
to the applicable purchase agreement during the period of effectivity of the
policies represented by this Certificate will be covered to the extent specified
herein.
Insurers have agreed to the following:
A. In regard to Aircraft "all risks" Hull Insurance and Aircraft Hull
War and Allied Perils Insurance, Insurers agree to waive all rights of
subrogation or recourse against Boeing in accordance with the Aircraft General
Terms Agreement AGTA/(_____) which was incorporated by reference into the
applicable purchase agreement.
B. In regard to Airline Liability Insurance, Insurers agree:
(1) To include Boeing as an additional insured in accordance
with Customer's undertaking in Article 8.2.1 of the AGTA/(____) which
was incorporated by reference into the applicable purchase agreement.
(2) To provide that such insurance will be primary and not
contributory nor excess with respect to any other insurance available
for the protection of Boeing;
(3) To provide that with respect to the interests of Boeing,
such insurance shall not be invalidated or minimized by any action or
inaction, omission or misrepresentation by the Insured or any other
person or party (other than Boeing) regardless of any breach or
violation of any warranty, declaration or condition contained in such
policies;
(4) To provide that all provisions of the insurance coverages
referenced above, except the limits of liability, will operate to give
each i Insured or additional insured the same protection as if there
were a separate Policy issued to each.
C. In regard to all of the above referenced policies:
(1) Boeing will not be responsible for payment, set-off, or
assessment of any kind or any premiums in connection with the policies,
endorsements or coverages described herein;
(2) If a policy is canceled for any reason whatsoever, or any
substantial change is made in the coverage which affects the interests
of Boeing or if a policy is allowed to lapse for nonpayment of premium,
such cancellation, change or lapse shall not be effective as to Boeing
for thirty (30) days
App.I-3
53
SAMPLE
Insurance Certificate
(in the case of war risk and allied perils coverage seven (7) days
after sending, or such other period as may from time to time be
customarily obtainable in the industry) after receipt by Boeing of
written notice from the Insurers or the authorized representatives or
Broker of such cancellation, change or lapse; and
(3) For the purposes of the Certificate, "Boeing" is defined
as The Boeing Company, its divisions, subsidiaries, affiliates, the
assignees of each and their respective directors, officers, employees
and agents.
Subject to the terms, conditions, limitations and exclusions of the relative
policies.
(signature)
(typed name)
(title)
App I-4
54
SAMPLE
Purchase Agreement Assignment
THIS PURCHASE AGREEMENT ASSIGNMENT (Assignment) dated as of ________ 19__
between #, a company organized under the laws of ________________ (Assignor) and
________________________, a company organized under the laws of ________________
(Assignee). Capitalized terms used herein without definition will have the same
meaning as in the Boeing Purchase Agreement.
Assignor and The Boeing Company, a Delaware corporation (Boeing), are
parties to the Boeing Purchase Agreement, providing, among other things, for the
sale by Boeing to Assignor of certain aircraft, engines and related equipment,
including the Aircraft.
Assignee wishes to acquire the Aircraft and certain rights and interests
under the Boeing Purchase Agreement and Assignor, on the following terms and
conditions, is willing to assign to Assignee certain of Assignor's rights and
interests under the Boeing Purchase Agreement. Assignee is willing to accept
such assignment.
It is agreed as follows:
1. For all purposes of this Assignment, the following terms will have the
following meanings:
Aircraft -- one Boeing Model ______ aircraft, bearing manufacturer's serial
number _______, together with all engines and parts installed on such aircraft
on the Delivery Date.
Boeing -- Boeing shall include Boeing Sales Corporation (a wholly-owned
subsidiary of Boeing), a Guam corporation, and its successors and assigns.
Boeing Purchase Agreement -- Purchase Agreement No. ________ dated as of
____________ between Boeing and Assignor, as amended, but excluding
______________, providing, among other things, for the sale by Boeing to
Assignor of the Aircraft, as said agreement may be further amended to the extent
permitted by its terms.
Delivery Date -- the date on which the Aircraft is delivered by Boeing to
Assignee pursuant to and subject to the terms and conditions of the Boeing
Purchase Agreement and this Assignment.
2. Assignor does hereby assign to Assignee all of its rights and interests
in and to the Boeing Purchase Agreement, as and to the extent that the same
relate to the Aircraft and the purchase and operation thereof, except as and to
the extent expressly reserved below, including, without limitation, in such
assignment: [TO BE COMPLETED BY THE PARTIES.]
[EXAMPLES
(a) the right upon valid tender to purchase the Aircraft pursuant to the
Boeing Purchase Agreement subject to the terms and conditions thereof
and the right to take title to the Aircraft and to be named the
"Buyer" in the xxxx of sale for the Aircraft;
(b) the right to accept delivery of the Aircraft;
App. III-1
55
SAMPLE
Purchase Agreement Assignment
(c) all claims for damages arising as a result of any default under the
Boeing Purchase Agreement in respect of the Aircraft;
(d) all warranty and indemnity provisions contained in the Boeing Purchase
Agreement, and all claims arising thereunder, in respect of the
Aircraft; and
(e) any and all rights of Assignor to compel performance of the terms of
the Boeing Purchase Agreement in respect of the Aircraft.]
Reserving exclusively to Assignor, however:
[EXAMPLES
(i) all Assignor's rights and interests in and to the Boeing Purchase
Agreement as and to the extent the same relates to aircraft other than
the Aircraft, or to any other matters not directly pertaining to the
Aircraft;
(ii) all Assignor's rights and interests in or arising out of any advance
or other payments or deposits made by Assignor in respect of the
Aircraft under the Boeing Purchase Agreement and any amounts credited
or to be credited or paid or to be paid by Boeing in respect of the
Aircraft;
(iii) the right to obtain services, training, information and demonstration
and test flights pursuant to the Boeing Purchase Agreement; and
(iv) the right to maintain plant representatives at Boeing's plant pursuant
to the Boeing Purchase Agreement.]
Assignee hereby accepts such assignment.
3. Notwithstanding the foregoing, so long as no event of default or
termination under [specify document] has occurred and is continuing, Assignee
hereby authorizes Assignor, to the exclusion of Assignee, to exercise in
Assignor's name all rights and powers of Customer under the Boeing Purchase
Agreement in respect of the Aircraft.
4. For all purposes of this Assignment, Boeing will not be deemed to have
knowledge of or need recognize the occurrence, continuance or the discontinuance
of any event of default or termination under [specify document] unless and until
Boeing receives from Assignee written notice thereof, addressed to its Vice
President - Contracts, Boeing Commercial Airplane Group at X.X. Xxx 0000,
Xxxxxxx, Xxxxxxxxxx 00000, if by mail, or to 32-9430 Answerback BOEINGREN RNTN,
if by telex. Until such notice has been given, Boeing will be entitled to deal
solely and exclusively with Assignor. Thereafter, until Assignee has provided
Boeing written notice that any such events no longer continue, Boeing will be
entitled to deal solely and exclusively with Assignee. Boeing may act with
acquittance and conclusively rely on any such notice.
5. It is expressly agreed that, anything herein contained to the contrary
notwithstanding: (a) prior to the Delivery Date Assignor will perform its
obligations with respect to the Aircraft to be performed by
App. III-2
56
SAMPLE
Purchase Agreement Assignment
it on or before such delivery, (b) Assignor will at all times remain liable to
Boeing under the Boeing Purchase Agreement to perform all obligations of
Customer thereunder to the same extent as if this Assignment had not been
executed, and (c) the exercise by Assignee of any of the assigned rights will
not release Assignor from any of its obligations to Boeing under the Boeing
Purchase Agreement, except to the extent that such exercise constitutes
performance of such obligations.
6. Notwithstanding anything contained in this Assignment to the contrary
(but without in any way releasing Assignor from any of its obligations under the
Boeing Purchase Agreement), Assignee confirms for the benefit of Boeing that,
insofar as the provisions of the Boeing Purchase Agreement relate to the
Aircraft, in exercising any rights under the Boeing Purchase Agreement, or in
making any claim with respect to the Aircraft or other things (including,
without limitation, Material, training and services) delivered or to be
delivered pursuant to the Boeing Purchase Agreement, the terms and conditions of
the Boeing Purchase Agreement, including, without limitation, the DISCLAIMER AND
RELEASE and EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES in Article 11 of Part 2
of Exhibit C to the Aircraft General Terms Agreement which was incorporated by
reference into the Boeing Purchase Agreement and the insurance provisions in
Article 8.2 of the Aircraft General Terms Agreement which was incorporated by
reference into the Boeing Purchase Agreement therein, will apply to and be
binding on Assignee to the same extent as if Assignee had been the original
"Customer" thereunder. Assignee further agrees, expressly for the benefit of
Boeing, upon the written request of Boeing, Assignee will promptly execute and
deliver such further assurances and documents and take such further action as
Boeing may reasonably request in order to obtain the full benefits of Assignee's
agreements in this paragraph.
7. Nothing contained herein will subject Boeing to any liability to which
it would not otherwise be subject under the Boeing Purchase Agreement or modify
in any respect the contract rights of Boeing thereunder, or require Boeing to
divest itself of title to or possession of the Aircraft or other things until
delivery thereof and payment therefor as provided therein.
8. Notwithstanding anything in this Assignment to the contrary, after
receipt of notice of any event of default or termination under [specify
document], Boeing will continue to owe to Assignor moneys in payment of claims
made or obligations arising before such notice, which moneys may be subject to
rights of set-off available to Boeing under applicable law. Similarly, after
receipt of notice that such event of default or termination no longer continues,
Boeing will continue to owe to Assignee moneys in payment of claims made or
obligations arising before such notice, which moneys may be subject to rights of
set-off available to Boeing under applicable law.
9. Effective at any time after an event of default has occurred, and for so
long as such event of default is continuing, Assignor does hereby constitute
Assignee, Assignor's true and lawful attorney, irrevocably, with full power (in
the name of Assignor or otherwise) to ask, require, demand, receive, and give
acquittance for any and all moneys and claims for moneys due and to become due
under or arising out of the Boeing Purchase Agreement in respect of the
Aircraft, to the extent assigned by this Assignment.
10. Assignee agrees, expressly for the benefit of Boeing and Assignor that
it will not disclose, directly or indirectly, any terms of the Boeing Purchase
Agreement; provided, that Assignee may disclose any such information (a) to its
special counsel and public accountants, (b) as required by applicable law to be
disclosed or to the extent that Assignee may have received a subpoena or other
written demand under color of legal right for such information, but it will
first, as soon as practicable upon receipt of such requirement or
App. III-3
57
SAMPLE
Purchase Agreement Assignment
demand, furnish an explanation of the basis thereof to Boeing, and will afford
Boeing reasonable opportunity, to obtain a protective order or other reasonably
satisfactory assurance of confidential treatment for the information required
to be disclosed, and (c) to any bona fide potential purchaser or lessee of the
Aircraft. Any disclosure pursuant to (a) and (c) above will be subject to
execution of a confidentiality agreement substantially similar to this
paragraph 10.
11. This Assignment may be executed by the parties in separate
counterparts, each of which when so executed and delivered will be an original,
but all such counterparts will together constitute but one and the same
instrument.
12. This Assignment will be governed by, and construed in accordance with,
the laws of [_____________________].
---------------------------------- -------------------------------------
as Assignor as Assignee
By By
-------------------------------- ----------------------------------
Name: Name:
Title: Title:
[If the Assignment is further assigned by Assignee in connection with a
financing, the following language needs to be included.]
Attest:
The undersigned, as [Indenture Trustee/Agent for the benefit of the Loan
Participants/Mortgagee] and as assignee of, and holder of a security interest
in, the estate, right, and interest of the Assignee in and to the foregoing
Purchase Agreement Assignment and the Purchase Agreement pursuant to the terms
of a certain [Trust Indenture/Mortgage] dated as of _____________, agrees to the
terms of the foregoing Purchase Agreement Assignment and agrees that its rights
and remedies under such [Trust Indenture/Mortgage] shall be subject to the terms
and conditions of the foregoing Purchase Agreement Assignment, including,
without limitation, paragraph 6.
[Name of Entity],
as Indenture Trustee/Agent
By:
-------------------------------------
Name:
Title:
App. III-4
58
SAMPLE
Purchase Agreement Assignment
CONSENT AND AGREEMENT OF
THE BOEING COMPANY
THE BOEING COMPANY, a Delaware corporation (Boeing), hereby acknowledges
notice of and consents to the foregoing Purchase Agreement Assignment
(Assignment). Boeing confirms to Assignee that: all representations, warranties,
indemnities and agreements of Boeing under the Boeing Purchase Agreement with
respect to the Aircraft will, subject to the terms and conditions thereof and of
the Assignment, inure to the benefit of Assignee to the same extent as if
Assignee were originally named "Customer" therein.
This Consent and Agreement will be governed by, and construed in accordance
with, the law of the State of Washington, excluding the conflict of laws
principles thereof.
Dated as of ____________________, 199___.
THE BOEING COMPANY
By
-------------------------------------
Name:
Title: Attorney-in-Fact
Aircraft Manufacturer's Serial Number(s) ____________
App. III-5
59
SAMPLE
Post-Delivery Sale Notice
Boeing Commercial Airplane Group
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Vice President - Contracts
Mail Stop 75-38
Ladies and Gentlemen:
In connection with the sale by # (Seller) to ________________ (Purchaser) of the
aircraft identified below, reference is made to Purchase Agreement No. _____
dated as of ___________, 19__, between The Boeing Company (Boeing) and Seller
(the Purchase Agreement) under which Seller purchased certain Boeing Model
________ aircraft, including the aircraft bearing Manufacturer's Serial No.(s)
______________________ (the Aircraft). The Purchase Agreement incorporated by
reference Aircraft General Terms Agreement AGTA/# (AGTA).
Capitalized terms used herein without definition will have the same meaning as
in the Purchase Agreement.
Seller has sold the Aircraft, including in that sale the transfer to Purchaser
of all remaining rights related to the Aircraft under the Purchase Agreement. To
accomplish this transfer of rights, as authorized by the provisions of the
Purchase Agreement:
(1) Purchaser acknowledges it has reviewed the Purchase Agreement and agrees to
be bound by and comply with all applicable terms and conditions of the Purchase
Agreement, including, without limitation, the DISCLAIMER AND RELEASE and
EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES in Article 11 of Part 2 of Exhibit
C to the AGTA and the insurance provisions in Article 8.2 of the AGTA. Purchaser
further agrees upon the written request of Boeing, to promptly execute and
deliver such further assurances and documents and take such further action as
Boeing may reasonably request in order to obtain the full benefits of
Purchaser's agreements in this paragraph; and
(2) Seller will remain responsible for any payments due Boeing as a result of
obligations relating to the Aircraft incurred by Seller to Boeing prior to the
effective date of this letter.
App. III-1
60
SAMPLE
Post-Delivery Sale Notice
We request that Boeing acknowledge receipt of this letter and confirm the
transfer of rights set forth above by signing the acknowledgment and forwarding
one copy of this letter to each of the undersigned.
Very truly yours,
Seller Purchaser
By By
----------------------------- ---------------------------
Its Its
---------------------------- --------------------------
Dated Dated
-------------------------- ------------------------
Receipt of the above letter is acknowledged and transfer of rights under the
Purchase Agreement with respect to the Aircraft is confirmed, effective as of
this date.
THE BOEING COMPANY
By
-----------------------------
Its Attorney-in-Fact
----------------------------
Dated
--------------------------
Aircraft Manufacturer's Serial Number ____________
App. III-2
61
SAMPLE
Post-Delivery Lease Notice
Boeing Commercial Airplane Group
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Vice President - Contracts
Mail Stop 75-38
Ladies and Gentlemen:
In connection with the lease by # (Lessor) to ___________ (Lessee) of the
aircraft identified below, reference is made to Purchase Agreement No. ____
dated as of ________, 19__, between The Boeing Company (Boeing) and Lessor (the
Purchase Agreement) under which Lessor purchased certain Boeing Model _______
aircraft, including the aircraft bearing Manufacturer's Serial No.(s)
___________________ (the Aircraft). The Purchase Agreement incorporated by
reference Aircraft General Terms Agreement AGTA-@ (AGTA).
Capitalized terms used herein without definition will have the same meaning as
in the Purchase Agreement.
Lessor has leased the Aircraft, including in that lease the transfer to Lessee
of all remaining rights related to the Aircraft under the Purchase Agreement. To
accomplish this transfer of rights, as authorized by the provisions of the
Purchase Agreement:
(1) Lessor authorizes Lessee to exercise, to the exclusion of Lessor, all rights
and powers of Lessor with respect to the remaining rights related to the
Aircraft under the Purchase Agreement. This authorization will continue until
Boeing receives written notice from Lessor to the contrary, addressed to Vice
President - Contracts, Mail Stop 75-38, Boeing Commercial Airplane Group, X.X.
Xxx 0000, Xxxxxxx, Xxxxxxxxxx 00000-0000. Until Boeing receives such notice,
Boeing is entitled to deal exclusively with Lessee with respect to the Aircraft
under the Purchase Agreement. With respect to the rights and obligations of
Lessor under the Purchase Agreement, all actions taken or agreements entered
into by Lessee during the period prior to Boeing's receipt of this notice are
final and binding on Lessor. Further, any payments made by Boeing as a result of
claims made by Lessee will be made to the credit of Lessee.
(2) Lessee accepts the authorization above, acknowledges it has reviewed the
Purchase Agreement and agrees to be bound by and comply with all applicable
terms and conditions of the Purchase Agreement including, without limitation,
the DISCLAIMER AND RELEASE and EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES in
Article 11 of Part 2 of Exhibit C AGTA and the insurance provisions in Article
8.2 of the AGTA. Lessee further agrees, upon the written request of Boeing, to
promptly execute and deliver such further assurances and documents and take such
further action as Boeing may reasonably request in order to obtain the full
benefits of Lessee's agreements in this paragraph.
(3) Lessor will remain responsible for any payments due Boeing as a result of
obligations relating to the Aircraft incurred by Lessor to Boeing prior to the
effective date of this Notice.
App. IV-1
62
SAMPLE
Post-Delivery Lease Notice
We request that Boeing acknowledges receipt of this letter and confirm the
transfer of rights set forth above by signing the acknowledgment and forwarding
one copy of this letter to each of the undersigned.
Very truly yours,
Lessor Lessee
By By
---------------------------- ---------------------------
Its Its
---------------------------- --------------------------
Dated Dated
-------------------------- ------------------------
Receipt of the above letter is acknowledged and transfer of rights under the
Purchase Agreement with respect to the Aircraft is confirmed, effective as of
this date.
THE BOEING COMPANY
By
----------------------------
Its
----------------------------
Dated
--------------------------
Aircraft Manufacturer's Serial Number ____________
App. IV-2
63
SAMPLE
Purchaser's/Lessee's Agreement
Boeing Commercial Airplane Group
P. O. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention Vice President - Contracts
Mail Stop 75-38
Ladies and Gentlemen:
In connection with the sale/lease by # (Seller/Lessor) to
_______________________ (Purchaser/Lessee) of the aircraft identified below,
reference is made to the following documents:
(i) Purchase Agreement No. _____ dated as of ___________, 19__,
between The Boeing Company (Boeing) and Seller/Lessor (the Purchase
Agreement) under which Seller/Lessor purchased certain Boeing Model
________ aircraft, including the aircraft bearing Manufacturer's Serial
No.(s) ______________________ (the Aircraft); and
(ii) Aircraft Sale/Lease Agreement dated as of ___________, 19__,
between Seller/Lessor and Purchaser/Lessee (the Aircraft Agreement) under
which Seller/Lessor is selling/leasing the Aircraft.
Capitalized terms used herein without definition will have the same meaning as
in the Aircraft Agreement.
1. Seller/Lessor has sold/leased the Aircraft under the Aircraft Agreement,
including therein a form of exculpatory clause protecting Seller/Lessor from
liability for loss of or damage to the aircraft, and/or related incidental or
consequential damages, including without limitation loss of use, revenue or
profit.
2. Disclaimer and Release; Exclusion of Liabilities
2.1 In accordance with Seller/Lessor's obligation under Article 9.5 of
AGTA-@ which was incorporated by reference into the Purchase Agreement,
Purchaser/Lessee hereby agrees that:
2.2 DISCLAIMER AND RELEASE. IN CONSIDERATION OF THE SALE/LEASE OF THE
AIRCRAFT, PURCHASER/LESSEE HEREBY WAIVES, RELEASES AND RENOUNCES ALL WARRANTIES,
OBLIGATIONS AND LIABILITIES OF BOEING AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES
OF PURCHASER/LESSEE AGAINST BOEING, EXPRESS OR IMPLIED, ARISING BY LAW OR
OTHERWISE, WITH RESPECT TO ANY NONCONFORMANCE OR DEFECT IN ANY AIRCRAFT, BOEING
PRODUCT, MATERIALS, TRAINING, SERVICES OR OTHER THING PROVIDED UNDER THE
AIRCRAFT AGREEMENT, INCLUDING, BUT NOT LIMITED TO:
(A) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;
(B) ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF
DEALING OR USAGE OF TRADE;
(C) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT, WHETHER
OR NOT ARISING FROM THE NEGLIGENCE OF BOEING; AND
App-V-1
64
SAMPLE
Purchaser's/Lessee's Agreement
(D) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OF OR
DAMAGE TO ANY AIRCRAFT.
2.3 EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES. BOEING WILL HAVE NO
OBLIGATION OR LIABILITY, WHETHER ARISING IN CONTRACT (INCLUDING WARRANTY), TORT,
WHETHER OR NOT ARISING FROM THE NEGLIGENCE OF BOEING, OR OTHERWISE, FOR LOSS OF
USE, REVENUE OR PROFIT, OR FOR ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES
WITH RESPECT TO ANY NONCONFORMANCE OR DEFECT IN ANY AIRCRAFT, MATERIALS,
TRAINING, SERVICES OR OTHER THING PROVIDED UNDER THE AIRCRAFT AGREEMENT.
2.4 Definitions. For the purpose of this paragraph 0, "XXXXXX" xx "Xxxxxx"
is defined as The Boeing Company, its divisions, subsidiaries, affiliates, the
assignees of each, and their respective directors, officers, employees and
agents.
Seller/Lessor Purchaser/Lessee
By By
---------------------------- ---------------------------
Its Its
---------------------------- --------------------------
Dated Dated
-------------------------- ------------------------
App. V-2
65
SAMPLE
Owner Appointment of Agent - Warranties
Boeing Commercial Airplane Group
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Vice President - Contracts
Mail Stop 75-38
Ladies and Gentlemen:
1. Reference is made to Purchase Agreement No. ____ dated as of __________,
19__, between The Boeing Company (Boeing) and # (Customer) (the Purchase
Agreement), under which Customer purchased certain Boeing Model ________
aircraft including the aircraft bearing Manufacturer's Serial No.(s)
_____________ (the Aircraft). The Purchase Agreement incorporated by reference
Aircraft General Terms Agreement AGTA-@ (AGTA).
Capitalized terms used herein without definition will have the same meaning as
in the Purchase Agreement.
To accomplish the appointment of an agent, Customer confirms:
A. Customer has appointed ____________________ as agent (Agent) to act
directly with Boeing with respect to the remaining warranties under the
Purchase Agreement and requests Boeing to treat Agent as Customer for the
administration of claims with respect to such warranties; provided however,
Customer remains liable to Boeing to perform the obligations of Customer
under the Purchase Agreement.
B. Boeing may continue to deal exclusively with Agent concerning the
matters described herein unless and until Boeing receives written notice
from Customer to the contrary, addressed to Vice President - Contracts,
Mail Stop 75-38, Boeing Commercial Airplane Group, X.X. Xxx 0000, Xxxxxxx,
Xxxxxxxxxx 00000-0000, X.X.X. With respect to the rights and obligations of
Customer under the Purchase Agreement, all actions taken by Agent or
agreements entered into by Agent during the period prior to Boeing's
receipt of such notice are final and binding on Customer. Further, any
payments made by Boeing as a result of claims made by Agent will be made to
the credit of Agent unless otherwise specified when each claim is
submitted.
C. Customer will remain responsible for any payments due Boeing as a
result of obligations relating to the Aircraft incurred by Customer to
Boeing prior to the effective date of this Notice.
We request that Boeing acknowledge receipt of this letter and confirm the
appointment of Agent as stated above by signing the acknowledgment and
forwarding one copy of this letter to each of the undersigned.
Very truly yours,
#
By
----------------------------
App. VI-1
66
SAMPLE
Owner Appointment of Agent - Warranties
AGENT'S AGREEMENT
Agent accepts the appointment as stated above, acknowledges it has reviewed the
Purchase Agreement and agrees that, in exercising any rights or making any
claims thereunder, Agent will be bound by and comply with all applicable terms
and conditions of the Purchase Agreement including, without limitation, the
DISCLAIMER AND RELEASE and EXCLUSION OF CONSEQUENTIAL AND OTHER DAMAGES in
Article 11 of Part 2 of Exhibit C to the AGTA. Agent further agrees, upon the
written request of Boeing, to promptly execute and deliver such further
assurances and documents and take such further action as Boeing may reasonably
request in order to obtain the full benefits of the warranties under the
Purchase Agreement.
Very truly yours,
Agent
By
----------------------------
Its
----------------------------
Dated
--------------------------
Receipt of the above letter is acknowledged and the appointment of Agent with
respect to the above-described rights under the Purchase Agreement is confirmed,
effective as of this date.
THE BOEING COMPANY
By
----------------------------
Its
----------------------------
Dated
--------------------------
Aircraft Manufacturer's Serial Number __________
App. VI-2
67
SAMPLE
Contractor Confidentiality Agreement
Boeing Commercial Airplane Group
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Vice President - Contracts
Mail Stop 75-38
Ladies and Gentlemen:
This Agreement is entered into between ____________________ (Contractor) and #
(Customer) and will be effective as of the date stated below.
In connection with Customer's provision to Contractor of certain Materials,
Proprietary Materials and Proprietary Information, reference is made to Purchase
Agreement No. _____ dated as of _______ , 19___ between The Boeing Company
(Boeing) and Customer.
Capitalized terms used herein without definition will have the same meaning as
in the Purchase Agreement.
Boeing has agreed to permit Customer to make certain Materials, Proprietary
Materials and Proprietary Information relating to Customer's Boeing Model
________ aircraft, Manufacturer's Serial Number ______, Registration No.
________ (the Aircraft) available to Contractor in connection with Customer's
contract with Contractor (the Contract) to maintain/repair/modify the Aircraft.
As a condition of receiving the Proprietary Materials and Proprietary
Information, Contractor agrees as follows:
1. For purposes of this Agreement:
"Aircraft Software" means software that is installed and used in the
operation of an Aircraft.
"Materials" are defined as any and all items that are created by Boeing or
a third party, which are provided directly or indirectly from Boeing and serve
primarily to contain, convey or embody information. Materials may include either
tangible embodiments (for example, documents or drawings), or intangible
embodiments (for example, software and other electronic forms) of information
but excludes Aircraft Software.
"Proprietary Information" means any and all proprietary, confidential
and/or trade secret information owned by Boeing or a Third Party which is
contained, conveyed or embodied in Proprietary Materials.
"Proprietary Materials" means Materials that contain, convey, or embody
Proprietary Information.
"Third Party" means anyone other than Boeing, Customer and Contractor.
2. Boeing has authorized Customer to grant to Contractor a worldwide,
non-exclusive, personal and nontransferable license to use Proprietary Materials
and Proprietary Information, owned by Boeing, internally in connection with
performance of the Contract or as may otherwise be authorized by Boeing in
writing. Contractor will keep confidential and protect from disclosure to any
person, entity or government agency, including any person or entity affiliated
with Contractor, all Proprietary Materials and Proprietary Information.
Individual copies of all Materials are provided to Contractor subject to
copyrights therein, and all such copyrights are retained by Boeing or, in some
cases, by Third Parties. Contractor is authorized to make copies of
App. VII-1
68
SAMPLE
Contractor Confidentiality Agreement
Materials (except for Materials bearing the copyright legend of a Third Party)
provided, however, Contractor preserves the restrictive legends and proprietary
notices on all copies. All copies of Proprietary Materials will belong to
Boeing and be treated as Proprietary Materials under this Agreement.
3. Contractor specifically agrees not to use Proprietary Materials or
Proprietary Information in connection with the manufacture or sale of any part
or design. Unless otherwise agreed with Boeing in writing, Proprietary Materials
and Proprietary Information may be used by Contractor only for work on the
Aircraft for which such Proprietary Materials have been specified by Boeing.
Customer and Contractor recognize and agree that they are responsible for
ascertaining and ensuring that all Materials are appropriate for the use to
which they are put.
4. Contractor will not attempt to gain access to information by reverse
engineering, decompiling, or disassembling any portion of any software provided
to Contractor pursuant to this Agreement.
5. Upon Boeing's request at any time, Contractor will promptly return to Boeing
(or, at Boeing's option, destroy) all Proprietary Materials, together with all
copies thereof and will certify to Boeing that all such Proprietary Materials
and copies have been so returned or destroyed.
6. To the extent required by a government regulatory agency having jurisdiction
over Contractor, Customer or the Aircraft, Contractor is authorized to provide
Proprietary Materials and disclose Proprietary Information to the agency for the
agency's use in connection with Contractor's, authorized use of such Proprietary
Materials and/or Proprietary Information in connection with Contractor's
maintenance, repair, or modification of the Aircraft. Contractor agrees to take
reasonable steps to prevent such agency from making any distribution or
disclosure, or additional use of the Proprietary Materials and Proprietary
Information so provided or disclosed. Contractor further agrees to promptly
notify Boeing upon learning of any (i) distribution, disclosure, or additional
use by such agency, (ii) request to such agency for distribution, disclosure, or
additional use, or (iii) intention on the part of such agency to distribute,
disclose, or make additional use of the Proprietary Materials or Proprietary
Information.
7. Boeing is a third-party beneficiary under to this Agreement, and Boeing may
enforce any and all of the provisions of the Agreement directly against
Contractor. Contractor hereby submits to the jurisdiction of the Washington
state courts and the United States District Court for the Western District of
Washington with regard to any claims Boeing may make under this Agreement. It is
agreed that Washington law (excluding Washington's conflict-of-law principles)
governs this Agreement.
8. No disclosure or physical transfer by Boeing or Customer to Contractor, of
any Proprietary Materials or Proprietary Information covered by this Agreement
will be construed as granting a license, other than as expressly set forth in
this Agreement or any ownership right in any patent, patent application,
copyright or proprietary information.
9. The provisions of this Agreement will apply notwithstanding any markings or
legends, or the absence thereof, on any Proprietary Materials.
10. This Agreement is the entire agreement of the parties regarding the
ownership and treatment of Proprietary Materials and Proprietary Information,
and no modification of this Agreement will be effective as against Boeing unless
in writing signed by authorized representatives of Contractor, Customer and
Boeing.
App. VII-2
69
SAMPLE
Contractor Confidentiality Agreement
11. Failure by either party to enforce any of the provisions of this Agreement
will not be construed as a waiver of such provisions. If any of the provision of
this Agreement is held unlawful or otherwise ineffective by a court of competent
jurisdiction, the remainder of the Agreement will remain in full force.
ACCEPTED AND AGREED TO this
Date: _____________________, 19___
CONTRACTOR CUSTOMER
By By
---------------------------- ---------------------------
Its Its
--------------------------- --------------------------
App. VII-3
