AIRBUS A318/A319 PURCHASE AGREEMENT
Dated as of March 10, 2000
between
AVSA, S.A.R.L.,
Seller
and
FRONTIER AIRLINES, INC.
Buyer
C O N T E N T S
CLAUSES TITLE
0 DEFINITIONS
1 SALE AND PURCHASE
2 SPECIFICATION
3 PRICE
4 PRICE REVISION
5 PAYMENT TERMS
6 INSPECTION
7 CERTIFICATION
8 TECHNICAL ACCEPTANCE
9 DELIVERY
10 EXCUSABLE DELAY AND TOTAL LOSS
11 INEXCUSABLE DELAY
12 WARRANTIES AND SERVICE LIFE POLICY
13 PATENT AND COPYRIGHT INDEMNITY
14 TECHNICAL DATA AND DOCUMENTATION
15 FIELD ASSISTANCE
16 TRAINING AND TRAINING AIDS
17 EQUIPMENT SUPPLIER PRODUCT SUPPORT
18 BUYER FURNISHED EQUIPMENT AND DATA
19 INDEMNITIES AND INSURANCE
20 ASSIGNMENTS AND TRANSFERS
21 TERMINATION EVENTS
22 MISCELLANEOUS PROVISIONS
23 CERTAIN REPRESENTATIONS OF THE PARTIES
C O N T E N T S
EXHIBITS
EXHIBIT A-1 A318 STANDARD SPECIFICATION
APPENDIX 1 TO SCNs
EXHIBIT A-1
EXHIBIT A-2 A319 STANDARD SPECIFICATION
APPENDIX 1 TO SCNs
EXHIBIT A-2
EXHIBIT B SCN FORM
EXHIBIT C SELLER SERVICE LIFE POLICY
EXHIBIT D CERTIFICATE OF ACCEPTANCE
EXHIBIT E ▇▇▇▇ OF SALE
EXHIBIT F TECHNICAL DATA AND DOCUMENTATION
APPENDIX 1 TO LICENSE FOR USE OF THE PERFORMANCE
ENGINEER'S EXHIBIT F PROGRAM
APPENDIX 2 TO LICENSE FOR USE OF CD-ROM
EXHIBIT F
EXHIBIT G SELLER PRICE REVISION FORMULA
EXHIBIT H PROPULSION SYSTEMS PRICE REVISION FORMULA
EXHIBIT I CONFIDENTIALITY TERMS
P U R C H A S E A G R E E M E N T
This agreement is made this 10th day of March 2000
between
AVSA, a societe a responsabilite limitee organized and
existing under the laws of the Republic of France, having its
registered office located at
▇, ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇
(hereinafter referred to as the "Seller")
and
Frontier Airlines, Inc., a corporation organized and existing
under the laws of the State of Colorado, United States of
America, having its principal corporate offices located at
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
(hereinafter referred to as the "Buyer")
WHEREAS the Buyer wishes to purchase and the Seller is willing to sell
up to twenty-nine (29) Airbus Industrie A318-100 and A319-100 model
aircraft, on the terms and conditions herein provided; and
WHEREAS the Seller is a sales subsidiary of Airbus Industrie, G.I.E.,
and will purchase the Aircraft from Airbus Industrie, G.I.E.,for resale
to the Buyer,
NOW THEREFORE IT IS AGREED AS FOLLOWS:
0 - DEFINITIONS
For all purposes of this agreement, except as otherwise expressly
provided or unless the context otherwise requires, the following terms
will have the following meanings:
A318 Aircraft - any or all of the A318 Firm Aircraft, A318 Option
Aircraft and Additional Option Aircraft that the Buyer orders as
A318-100 aircraft.
A319 Aircraft - any or all of the A319 Firm Aircraft, A319 Option
Aircraft and Additional Option Aircraft that the Buyer orders as
A319-100 aircraft.
A318 Firm Aircraft - any or all of the five (5) firm A318-100 aircraft
for which the delivery schedule is set forth in Clause 9.1.1 hereof to
be sold by the Seller and purchased by the Buyer pursuant to this
Agreement, together with all components, equipment, parts and
accessories installed in or on such aircraft and the A318 Propulsion
Systems installed thereon upon delivery.
A318 Option Aircraft - any or all of the five (5) A318-100 aircraft on
option order for which the delivery schedule is set forth in Clause
9.1.1 hereof, and which may be sold by the Seller and purchased by the
Buyer pursuant to this Agreement, together with all components,
equipment, parts and accessories installed in or on such aircraft and
the A318 Propulsion Systems installed thereon upon delivery.
A318 Propulsion Systems - the two (2) ▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇ 6124
powerplants installed on an A318 Aircraft at delivery, each composed of
the powerplant (as such term is defined in Chapters 70-80 of ATA
Specification 100 (Revision 21), but limited to the equipment,
components, parts and accessories included in the powerplant, as so
defined) that have been sold to the Manufacturer by ▇▇▇▇▇ & Whitney.
A318 Specification - the A318 Standard Specification as amended by the
SCNs set forth in Appendix 1 to Exhibit A-1 hereto as may be further
amended or modified in accordance with this Agreement.
A318 Standard Specification - the A318 standard specification document
number P.000.01000, Issue A, dated November 25, 1998, published by the
Manufacturer, which includes an MTOW of 145,505 pounds, a copy of which
is annexed as Exhibit A-1 hereto.
A319 Firm Aircraft - any or all of the six (6) firm A319-100 aircraft
for which the delivery schedule is set forth in Clause 9.1.1 hereof to
be sold by the Seller and purchased by the Buyer pursuant to this
Agreement, together with all components, equipment, parts and
accessories installed in or on such aircraft and the A319 Propulsion
Systems installed thereon upon delivery.
A319 Option Aircraft - any or all of the four (4) A319-100 aircraft on
option order for which the delivery schedule is set forth in Clause
9.1.1 hereof, and which may be sold by the Seller and purchased by the
Buyer pursuant to this Agreement, together with all components,
equipment, parts and accessories installed in or on such aircraft and
the A319 Propulsion Systems installed thereon upon delivery.
A319 Propulsion Systems - the two (2) CFM 56-5B5/P powerplants
installed on an A319 Aircraft at delivery, each composed of the
powerplant (as such term is defined in Chapters 70-80 of ATA
Specification 100 (Revision 21), but limited to the equipment,
components, parts and accessories included in the powerplant, as so
defined) that have been sold to the Manufacturer by CFM International.
A319 Specification - the A319 Standard Specification as amended by the
SCNs set forth in Appendix 1 to Exhibit A-2 hereto as may be further
amended or modified in accordance with this Agreement.
A319 Standard Specification - the A319 standard specification document
number J.000.01000, Issue 4, dated January 30, 1998, published by the
Manufacturer, which includes an MTOW of 154,324 pounds, a copy of which
is annexed as Exhibit A-2 hereto.
Additional Option Aircraft - up to nine (9) A318-100 and A319-100 model
aircraft other than Firm Aircraft and Option Aircraft that may be
purchased by the Seller and sold to the Buyer pursuant to this
Agreement, together with all components, equipment, parts and
accessories installed in or on such aircraft and the Propulsion Systems
installed thereon upon delivery.
Affiliate - with respect to any person or entity, any other person or
entity directly or indirectly controlling, controlled by or under
common control with such person or entity, not including any of the
Associated Contractors.
Agreement - this Airbus A318/A319 Purchase Agreement, including all
Exhibits and Appendixes attached hereto, as the same may be amended or
modified and in effect from time to time.
Aircraft - any or all of the Firm Aircraft or Option Aircraft that have
been converted to a firm order.
Airframe - any Aircraft, excluding the Propulsion Systems therefor.
ASCO - Airbus Service Company, Inc., a corporation organized and
existing under the laws of Delaware, having its registered office
located at ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or any
successor thereto.
Associated Contractors - collectively, the members and, for certain
purposes, subcontractors of the Manufacturer from time to time, which
members presently are:
(1) AEROSPATIALE MATRA S.A. ("Aerospatiale"), whose principal
office is at
▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
(2) BRITISH AEROSPACE (OPERATIONS) LTD, whose principal office is
at
Warwick House
PO Box 87
Farnborough Aerospace Centre
Farnborough
Hants GU14 6YU
England
(3) CONSTRUCCIONES AERONAUTICAS,S.A., whose principal office is at
404 ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
(4) DAIMLERCHRYSLER AEROSPACE AIRBUS,GmbH("DASA"), whose principal
office is at
Kreetslag 10
▇▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
ATA Specification 100 - the specification issued by the Air Transport
Association of America relating to manufacturers' technical data.
ATA Specification 101 - the specification issued by the Air Transport
Association of America relating to ground equipment technical data.
ATA Specification 102 - the specification issued by the Air Transport
Association of America relating to software programs.
ATA Specification 200 - the specification issued by the Air Transport
Association of America relating to integrated data processing.
ATA Specification 300 - the specification issued by the Air Transport
Association of America relating to the packaging of spare parts
shipments.
ATA Specification 2000 - the specification issued by the Air Transport
Association of America relating to an industry-wide communication
system linking suppliers and users for the purposes of spares
provisioning, purchasing, order administration, invoicing and
information or data exchange.
ATA Specification 2100 - the specification issued by the Air Transport
Association of America relating to the standards for the presentation
of technical information prepared as digital media (magnetic tape or CD
ROM).
Aviation Authority -when used with respect to any jurisdiction, the
government entity that, under the laws of such jurisdiction, has
control over civil aviation or the registration, airworthiness or
operation of civil aircraft in such jurisdiction.
Balance of the Final Contract Price - means the amount payable by the
Buyer to the Seller on the Delivery Date for an Aircraft after
deducting from the Final Contract Price for such Aircraft the amount of
all Predelivery Payments received by the Seller from the Buyer in
respect of such Aircraft on or before the Delivery Date for such
Aircraft.
Base Price - for any Aircraft, Airframe or Propulsion Systems, as more
completely defined in Clause 3.1 of this Agreement.
Buyer Furnished Equipment (BFE) - for any Aircraft, all the items of
equipment that will be furnished by the Buyer and installed in the
Aircraft by the Seller, as defined in the Specification.
Buyer Termination Event - as defined in Clause 21.1.1 of this
Agreement.
Certificate of Airworthiness for Export - an export certificate of
airworthiness issued by the Aviation Authority of the Delivery
Location.
Customer Originated Changes (COC) - Buyer-originated data that are
introduced into Seller's Technical Data and Documentation, as more
completely set forth in Clause 14.4.3 of this Agreement.
Delivery - the transfer of title to the Aircraft from the Seller to the
Buyer, in accordance with Clause 9.
Delivery Date - the date on which Delivery will occur.
Delivery Location - the facilities of the Seller at the location of
final assembly of the Aircraft, which is currently at DASA's works in
Hamburg, Germany, for the A318 and A319 model aircraft.
Deposit - Each of the deposit amounts described in Clause 5.3 of this
Agreement.
DGAC - the Direction Generale de l'Aviation Civile of France, or any
successor thereto.
Excusable Delay - delay in delivery or failure to deliver an Aircraft
due to causes specified in Clause 10.1 of this Agreement.
FAA - the U.S. Federal Aviation Administration, or any successor
thereto.
Final Contract Price - as defined in Clause 3.2 of this Agreement.
Firm Aircraft - any or all of the eleven (11) A318 Firm Aircraft and
A319 Firm Aircraft.
Free Carrier (FCA) - defined in the April 1990 edition of publication
No. 460, published by the International Chamber of Commerce.
In-house Warranty - as referred to in Clause 12.1.7 of this Agreement.
In-house Warranty Labor Rate - as defined in Clause 12.1.7(v) of this
Agreement.
Interface Problem - as defined in Clause 12.4.1 of this Agreement.
JAA - Joint Aviation Authorities or any successor thereto.
LBA - Luftfahrt-Bundesamt of Germany or any successor thereto.
LIBOR - the London Interbank Offered Rate for each stated interest
period, the rate determined on the basis of the offered rates for
deposits in US dollars, which appear on the Reuters Screen LIBO Page as
of 11:00 a.m., London time, on the day that is two (2) days (other than
a Saturday, Sunday or a day that is a legal holiday or a day on which
banking institutions are authorized to close in the City of New York,
New York, London, England, or Paris, France) before the first day of an
interest period. If at least two (2) such offered rates appear on the
Reuters Screen LIBO Page, the rate for that interest period will be the
arithmetic mean of such offered rates rounded to the nearest basis
point (0.5 rounds to 1). If only one (1) offered rate appears, the rate
for that interest period will be "LIBOR" as quoted by National
Westminster Bank, plc. "Reuters Screen LIBO Page" means the display
designated as page "LIBO" on the Reuters Monitor Money Rates Service
(or any successor to such page or service).
Manufacturer - Airbus Industrie, a "Groupement d'Interet Economique"
established under "Ordonnance" No. 67-821 dated September 23, 1967, of
the Republic of France.
Option Aircraft - any or all of the nine (9) A318 Option Aircraft and
A319 Option Aircraft.
Predelivery Payment - any of the payments made in accordance with
Clause 5.2.3 or 5.2.4 of this Agreement, which, in the case of the
first such payment, will include the Deposit.
Predelivery Payment Reference Price - as defined in Clause 5.2.2 of
this Agreement.
Propulsion Systems - the A318 Propulsion Systems and/or A319 Propulsion
Systems, as applicable.
Propulsion Systems Price Revision Formula - the price revision formula
for A319 Propulsion Systems, set forth in Exhibit H hereto.
Ready for Delivery - the state of an Aircraft when it (i) has
successfully completed the Technical Acceptance Process (as defined in
Clause 8.1.1 of the Agreement) and (ii) has been issued the Certificate
of Airworthiness for Export.
Reference Price - as set forth in Clause 3.1.2 of the Agreement.
Scheduled Delivery Month - as defined in Clause 9.1.1 of the Agreement.
Seller Price Revision Formula - the price revision formula set forth in
Exhibit G hereto.
Seller Termination Event - as defined in Clause 21.1.3 of this
Agreement.
Service Life Policy - as referred to in Clause 12.2 of this Agreement.
Specification - the A318 Specification and/or the A319 Specification,
as applicable.
Specification Change Notice (SCN) - an agreement in writing between the
Seller and the Buyer amending the Specification pursuant to Clause 2.
Supplier - any supplier of Supplier Parts.
Supplier Parts - any component, equipment, accessory or part installed
in an Aircraft at the time of Delivery thereof, not including the
Propulsion Systems or Buyer Furnished Equipment, for which there exists
a Supplier Product Support Agreement.
Supplier Product Support Agreement -an agreement between the Seller and
each Supplier of Seller Furnished Equipment listed in the Specification
containing enforceable and transferable warranties (and in the case of
landing gear suppliers, service life policies for selected structural
landing gear elements).
Technical Data and Documentation - the documents, manuals and data
listed and described in Exhibit F hereto.
Training Conference - as defined in Clause 16.4.1 of this Agreement.
Warranted Part - as defined in Clause 12.1.1 of this Agreement.
Warranty Claim - as defined in Clause 12.1.6(v) of this Agreement.
Working Day - with respect to any action to be taken hereunder, a day
other than a Saturday, Sunday or other day designated as a holiday in
the jurisdiction in which such action is required to be taken.
The terms "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement, and not a particular Clause thereof.
The definition of a singular in this Clause will apply to plurals of
the same words.
Technical and trade items not otherwise defined herein will have the
meanings assigned to them as generally accepted in the aircraft
manufacturing industry.
1 - SALE AND PURCHASE
-----------------
The Seller will cause to be manufactured and will sell and
deliver, and the Buyer will buy and take delivery of, the
Aircraft at the Delivery Location, subject to the terms and
conditions in this Agreement.
2 - SPECIFICATION
-------------
2.1 Specification Documents
2.1.1 The Aircraft will be manufactured in accordance with, as
applicable, the A318 Specification or the A319 Specification.
The Specifications may be further modified from time to time
pursuant to the provisions of this Clause 2.
2.1.2 Specification Change Notice
Each Specification may be amended by written agreement between
the parties in an SCN. Each SCN will be substantially in the
form set out in Exhibit B hereto and will set out in detail
the particular change to be made to the Specification and the
effect, if any, of such change on design, performance, weight,
time of delivery of the Aircraft, and text of the
Specification. An SCN may result in an upward or downward
adjustment of the Base Price.
2.1.3 In the event that a duly authorized representative of the
Buyer makes a written request that the Seller proceed with a
proposed change, the Seller will consider such request. If the
Seller believes that the cost of studying the proposed change
will be significant, the Seller will provide the Buyer with an
estimate of such cost but will not proceed without the Buyer's
written approval * if the change is subsequently incorporated
into the Aircraft, the cost of design and other work will be
included in the pricing of such change.
2.1.4 Development Changes
Each Specification may also be amended by the Seller without
the Buyer's consent when changes are made to the basic
specification for A318 or A319 model aircraft generally, which
do not adversely affect price, time of delivery, weight or
performance of the Aircraft, interchangeability or
replaceability requirements under the Specification. These
changes are hereinafter defined as "Development Changes." The
Seller will notify the Buyer on a regular basis of all
Development Changes and furnish to the Buyer without charge
revised pages for the amended Specification.
2.2 Propulsion Systems
The A318 Aircraft will be equipped with A318 Propulsion
Systems and the A319 Aircraft will be equipped with A319
Propulsion Systems.
2.3 Customization Milestones Chart
Within a reasonable period after signature of the Agreement,
the Seller will provide the Buyer with a Customization
Milestones Chart. The Customization Milestones Chart will
state the lead times before Delivery needed to reach agreement
on items requested by the Buyer from the specification changes
catalogs made available to the Seller.
3 - PRICE
-----
3.1 Base Price of the Aircraft
3.1.1 A318 Aircraft
The Base Price of each A318 Aircraft is the sum of
(i) the Base Price of the A318 Aircraft as defined in the
A318 Standard Specification (excluding Buyer
Furnished Equipment and SCNs), at delivery conditions
prevailing in January 1999, which is:
US $ *
(US dollars--* ), and
(ii) the Base Price of any and all SCNs mutually agreed
upon prior to the signature of this Agreement and set
forth in Appendix 1 to Exhibit A-1 hereto, at
delivery conditions prevailing in January 1999, which
is:
US $ *
(US dollars--* ).
3.1.2 A319 Aircraft
3.1.2.1 The Base Price of each A319 Aircraft is the sum of:
(i) the Base Price of the Airframe of the A319 Aircraft,
and
(ii) the Base Price of the A319 Propulsion Systems.
3.1.2.2 Base Price of the Airframe
The Base Price of the Airframe of the A319 Aircraft is the sum
of
(i) the Base Price of the Airframe, as defined in the
A319 Standard Specification (excluding Buyer
Furnished Equipment and SCNs), at delivery conditions
prevailing in January 1999, which is:
US $ *
(US dollars--* ), and
(ii) the Base Price of any and all SCNs mutually agreed
upon prior to the signature of this Agreement and set
forth in Appendix 1 to Exhibit A-2 hereto, at
delivery conditions prevailing in January 1999, which
is:
US $ *
(US dollars--* ).
3.1.2.3 Base Price of the A319 Propulsion Systems
3.1.2.3.1 The Base Price of the A319 Propulsion Systems, at delivery
conditions prevailing in January 1999, is:
US $ *
(US dollars--* ).
Said Base Price has been calculated in accordance with the
Propulsion Systems Price Revision Formula from the Reference
Price published by * of US $ * (US dollars-- * ) at economic
conditions prevailing in July 1996.
3.1.2.3.2 Validity of A319 Propulsion Systems Prices
It is understood that the prices and Propulsion Systems Price
Revision Formula cited above for the A319 Propulsion Systems
and related equipment are based on information received from
CFM International and remain subject to any modification that
might be communicated by CFM International to the
Manufacturer, the Seller and/or the Buyer.
3.2 Final Contract Price
3.2.1 The Final Contract Price of an A318 Aircraft will be the sum
of:
(i) the Base Price of the A318 Aircraft, as adjusted to
the Delivery Date of such Aircraft in accordance with
the Seller Price Revision Formula;
(ii) the price (as of delivery conditions prevailing in
January 1999) of any SCNs for A318 Aircraft entered
into after the date of execution of this Agreement,
as adjusted to the Delivery Date in accordance with
the Seller Price Revision Formula; and
(iii) any other amount that is expressly stated to be
included in the Final Contract Price of an A318
Aircraft pursuant to any other provisions of this
Agreement and/or any other written agreement between
the Buyer and the Seller relating to the A318
Aircraft.
3.2.2 The Final Contract Price of an A319 Aircraft will be the sum o
(i) the Base Price of the Airframe constituting a part of
such Aircraft, as adjusted to the Delivery Date of
such Aircraft in accordance with the Seller Price
Revision Formula;
(ii) the price (as of delivery conditions prevailing in
January 1999) of any SCNs for A319 Aircraft entered
into after the date of execution of this Agreement,
as adjusted to the Delivery Date in accordance with
the Seller Price Revision Formula;
(iii) the Reference Price of the installed A319 Propulsion
Systems constituting a part of such Aircraft, as
adjusted to the Delivery Date in accordance with the
Propulsion Systems Price Revision Formula; and
(iv) any other amount that is expressly stated to be
included in the Final Contract Price of an A319
Aircraft pursuant to any other provisions of this
Agreement and/or any other written agreement between
the Buyer and the Seller relating to the A319
Aircraft.
3.3 Taxes, Duties and Imposts
3.3.1 The Seller will bear and pay the amount of any and all taxes
(excluding taxes on the income of the Buyer), duties, imposts
or similar charges of any nature whatsoever that are (i)
imposed upon the Buyer, (ii) imposed upon the Seller with an
obligation on the Buyer to withhold or collect the amount
thereof from the Seller or (iii) imposed upon the Buyer with
an obligation on the Seller to withhold or collect such amount
from the Buyer, and that a re levied, assessed, charged or
collected for or in connection with the fabrication,
manufacture, modification, assembly, sale, delivery, use of or
payment under this Agreement for any Aircraft, component,
accessory, equipment or part delivered or furnished hereunder,
provided such taxes, duties, imposts or similar charges have
been levied, assessed, charged or collected under laws
promulgated and enforceable under the laws of the country of
the Delivery Location *.
3.3.2 The Buyer will bear and pay the amount of any and all taxes
(excluding taxes on the income of the Seller), duties, imposts
or similar charges of any nature whatsoever that are (i)
imposed upon the Seller, (ii) imposed upon the Buyer with an
obligation on the Seller to withhold or collect the amount
thereof from the Buyer or (iii) imposed upon the Seller with
an obligation for the Buyer to withhold or collect such amount
from the Seller, and that are levied, assessed, charged or
collected for or in connection with the fabrication,
manufacture, modification, assembly, sale, delivery or use of
or payment under this Agreement for any Aircraft, component,
accessory, equipment or part delivered or furnished hereunder,
provided such taxes, duties, imposts or similar charges have
been levied, assessed, charged or collected under laws
promulgated and enforceable in countries other than the
country of the Delivery Location *.
3.3.3 If a claim is made against either party (the "Indemnitee") by
any governmental authority for taxes, duties, imposts or
similar charges of any nature for which liability has been
assumed by the other party under this Clause 3.3 (the
"Indemnitor"), the Indemnitee will promptly give notice of
such claim to the Indemnitor and the Indemnitor (unless
otherwise requested by the Indemnitee) will assume the defense
or settlement of such claim, as the Indemnitor will deem
prudent. Notwithstanding the foregoing, if the Indemnitor
will request that the claim be contested, the Indemnitee will
contest (or will permit the Indemnitor, if so desired by the
Indemnitee, to contest) the claim in good faith; provided
that, (i) the Indemnitee will be required to contest any claim
beyond the level of administrative proceedings only if timely
requested by the Indemnitor, and (ii) the Indemnitee will keep
the Indemnitor informed as to the progress of any litigation.
The Indemnitee will not be required to take any action
pursuant to this Clause 3.3.3 unless (A) the Indemnitor will
have agreed to pay all costs and expenses that the Indemnitee
may incur in connection with contesting such claim (including,
without limitation, reasonable legal and accounting fees and
disbursements, bonding fees, penalties and interest); and (B)
the action to be taken will not result in any sale, forfeiture
or loss of, or the creation of any Lien on, the Aircraft or
any interest therein, or if, in the opinion of the Indemnitor,
there is a reasonable risk thereof, the Indemnitor will have
provided to the Indemnitee a bond in form and substance
reasonably satisfactory to the Indemnitee to protect against
such risk. The provisions of this Clause 3.3 will survive the
expiration or earlier termination of this Agreement.
3.3.4 The Seller will arrange for the exportation of the Aircraft
from the country of the Delivery Location and will pay any
customs duties, taxes and fees required to be paid with
respect to such exportation of the Aircraft *.
3.3.5 The Buyer will arrange for the importation of the Aircraft
into any country or jurisdiction and will pay any customs
duties, taxes and fees required to be paid with respect to
such importation of the Aircraft.
4 - PRICE REVISION
--------------
4.1 Seller Price Revision Formula
The Base Prices of the A318 Aircraft, the Airframe of the A319
Aircraft, and of SCNs are subject to revision up to and
including the Delivery Date, in accordance with the Seller
Price Revision Formula.
4.2 Propulsion Systems Price Revision Formula
The Reference Price of the Propulsion Systems for the A319
Aircraft will be revised to the Delivery Date corresponding to
the Aircraft on which these Propulsion Systems are installed,
in accordance with the Propulsion Systems Price Revision
Formula.
5 - PAYMENT TERMS
-------------
5.1 The Buyer will pay the Predelivery Payments, the Balance of
the Final Contract Price and any other amount due hereunder in
immediately available funds in United States dollars to Credit
Lyonnais, New York Branch, for transfer by Credit Lyonnais to
the Seller's account with Credit Lyonnais at ▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, or to such other
account as may be designated by the Seller.
5.2 Predelivery Payments
5.2.1 Predelivery Payments will be paid by the Buyer to the Seller
for each Aircraft and will, in the aggregate, amount to * of
the Predelivery Payment Reference Price of the Aircraft
defined below in Clause 5.2.2.
5.2.2 The Buyer will pay Predelivery Payments to the Seller
calculated on the Predelivery Payment Reference Price of each
Aircraft. The Predelivery Payment Reference Price is defined
as:
A = Pb (1 + 0.04N)
where
A = the Predelivery Payment Reference Price
for Aircraft to be delivered in calendar
year T.
Pb = the Base Price of the Aircraft as defined in
Clause 3 above.
N = (T - 1999).
T = the year of delivery of the relevant
Aircraft.
5.2.3 Predelivery Payments w ill be paid according to the following
schedules.
5.2.3.1 The schedule of Predelivery Payments for Firm Aircraft is as
follows:
Percentage of Aircraft
Predelivery Payment
Payment Date Reference Price
* *
TOTAL PAYMENT PRIOR TO DELIVERY *
5.2.3.2 The schedule of Predelivery Payments for Option Aircraft is as follows:
Percentage of Aircraft
Predelivery Payment
Payment Date Reference Price
* *
TOTAL PAYMENT PRIOR TO DELIVERY 15%
5.2.4 SCN Predelivery Payments
The Seller will be entitled to request Predelivery Payments
for each SCN executed after signature of this Agreement.
(i) For each SCN executed before the first day of the *
month before the Scheduled Delivery Month, the Buyer
will make a Predelivery Payment equal to * of the SCN
price. This Predelivery Payment will be paid on the
first day of the * before the Scheduled Delivery
Month.
(ii) For each SCN executed after the first day of * and
before the first day of the * before the Scheduled
Delivery Month, this Predelivery Payment will amount
to * of the SCN price, and for each SCN executed
after the first day of the * and before the first day
of the * month before the Scheduled Delivery Month
this payment will amount to * of the SCN price. These
payments will be paid on the first day of the * month
before the Scheduled Delivery Month.
5.3 Deposit
The Seller acknowledges that it has already received from the
Buyer the sum of US$ * (US dollars-- * ), which represents a
deposit of US$ * (US dollars-- * ) for each Firm Aircraft and
of US $* (US dollars-- * ) for each Option Aircraft. The
deposit paid with respect to each particular Aircraft will be
credited without interest against the first Predelivery
Payment for such Aircraft.
5.4 Payment of Balance of the Final Contract Price
Concurrently with the delivery of each Aircraft, the Buyer
will pay to the Seller the Balance of the Final Contract Price
for such Aircraft. The Seller's receipt of the full amount of
all Predelivery Payments and of the Balance of the Final
Contract Price, including any amounts due under Clause 5.5 or
5.6, will be a condition precedent to the Seller's obligation
to deliver such Aircraft.
5.5 Payment of Other Amounts
5.5.1 Unless otherwise expressly provided for herein, any payments
due hereunder or in respect of an Aircraft in addition to
those referred to in Clauses 5.2 and 5.4 above will be paid by
the Buyer concurrently with the delivery of the corresponding
Aircraft or, if the Seller elects to invoice such amounts
after delivery of such Aircraft, within one (1) month after
the invoice date.
5.5.2 The Seller will give the Buyer written notice of any amount
(whether under this Agreement or under any other agreement
between the Buyer and the Seller and whether at the stated
maturity of such amount, by acceleration or otherwise) that is
due and payable by the Buyer or its Affiliates and is not paid
in full in immediately available funds on the date due. * the
Seller will have the right to debit and apply, in whole or in
part, the unused amount of any credit made available by the
Seller to the Buyer against such unpaid amount. The Seller's
rights under this Clause 5.5.2 are in addition to any other
rights the Seller may have at contract or at law and do not
contravene its rights under Clause 21 herein.
5.6 Overdue Payments
5.6.1 If one or more Predelivery Payments in respect of any Aircraft
is or are received after the due date specified in Clause
5.2.3, such that the aggregate number of days of delay in
respect of such Aircraft reaches thirty (30), then the Seller
will have the right to set back the Scheduled Delivery Month
for such Aircraft by a period of one (1) month for every
thirty (30) days of such delay.
Furthermore, if such delays in payment exceed sixty (60) days
in the aggregate for any Aircraft, in addition to any other
rights the Seller may have under Clause 21, the Seller will
have no obligation to deliver such Aircraft within the
Scheduled Delivery Month as modified pursuant to the preceding
paragraph. Upon receipt of the full amount of all late
Predelivery Payments, together with interest due under Clause
5.6, provided that the Seller has not exercised its right of
termination under Clause 21, the Seller will inform the Buyer
of a new Scheduled Delivery Month for such Aircraft,
consistent with Seller's other commitments and production
capabilities.
The Seller's rights under this Clause 5.6.1 are in addition to
any other rights and remedies available to the Seller.
5.6.2 If any payment due the Seller is not received by the Seller on
the date or dates agreed on between the Buyer and the Seller,
the Seller will have the right to claim from the Buyer and
the Buyer will promptly pay to the Seller on receipt of such
claim interest at the rate of one and one-half percent (1.5%)
per month on the amount of such overdue payment, to be
calculated from and including the due date of such payment to
(but excluding) the date such payment is received by the
Seller. The Seller's right to receive such interest will be
in addition to any other rights of the Seller hereunder or at
law.
5.7 Refund of Predelivery Payments
The Buyer will have no right to any refund of any Deposit or
Predelivery Payment received by the Seller *.
5.8 Proprietary Interest
Notwithstanding any provision of law to the contrary, the
Buyer will not, by virtue of anything contained in this
Agreement (including, without limitation, any Predelivery
Payments hereunder, or any designation or identification by
the Seller of a particular Aircraft as an Aircraft to which
any of the provisions of this Agreement refers) acquire any
proprietary, insurable or other interest whatsoever in any
Aircraft before Delivery of and payment for such Aircraft, as
provided in this Agreement.
5.9 Payment in Full
The Buyer's obligation to make payments to the Seller
hereunder will not be affected by and will be determined
without regard to any setoff, counterclaim, recoupment,
defense or other right that the Buyer may have against the
Seller or any other person. The Buyer will make all payments
to the Seller under this Agreement without deduction or
withholding on account of, and free from, any and all taxes,
duties, imposts or similar charges for which the Buyer is
responsible pursuant to Clause 3.3.2(iii) of this Agreement,
except that if the Buyer is compelled by law to make any such
deduction or withholding the Buyer will pay such additional
amounts as may be necessary so that the net amount received by
the Seller after such deduction or withholding will equal the
amounts that would have been received in the absence of such
deduction or withholding. If timely requested by the Buyer in
writing, the Seller will, at the Buyer's expense, take such
action as the Buyer may reasonably direct with respect to any
claim for taxes, duties, imposts and similar charges, and any
payment by the Seller of such amounts will be made under
protest, if, in the Buyer's judgment, protest is appropriate,
and, in the reasonable opinion of the Seller such protest will
not involve significant risk of any sale, forfeiture or loss
of, or creation of any lien on, the Aircraft or any interest
therein, or on any other aircraft manufactured by the
Manufacturer or sold by the Seller. If payment is made, the
Seller will, at the Buyer's expense, take such action as the
Buyer may reasonably direct to recover such payment and will,
if requested, permit the Buyer in the Seller's name to file a
claim or prosecute an action to recover such payment. If a
refund is obtained by the Seller of all or any part of such
amount, the Seller will pay the Buyer the amount of any such
refund, plus interest on the refunded taxes, if any.
6 - INSPECTION
6.1 Inspection Procedures
6.1.1 All work to be carried out on the Aircraft and all materials
and parts thereof will at all reasonable times during business
hours be open to inspection by duly authorized representatives
of the Buyer or its designee at the respective works of the
Associated Contractors and, if possible, at the works of their
respective subcontractors. These representatives will have
access to such relevant technical data as are reasonably
necessary for this purpose (except that, if access to any part
of the respective works where construction is in progress or
materials or parts are stored is restricted for security
reasons, the Associated Contractors will be allowed a
reasonable time to make the items available for inspection
elsewhere). The actual detailed inspection of the Aircraft,
materials and parts thereof will take place only in the
presence of the respective inspection department personnel of
the Associated Contractors or their subcontractors. The
procedures for such inspections will be agreed on with the
Buyer before any inspection.
6.1.2 All inspections, examinations and discussions with the
Seller's, the Associated Contractors' or their respective
subcontractors' engineering or other personnel by the Buyer
and its said representatives will be performed in such a
manner as not to delay or hinder the work to be carried out on
the Aircraft or the proper performance of this Agreement. In
no event will the Buyer or its representatives be permitted to
inspect any aircraft other than the Aircraft.
6.2 Representatives
For the purposes of Clause 6.1 above, at a mutually agreed
date that will not, in any event, be later than twelve (12)
months before the date on which the first Aircraft is
scheduled to be delivered to the Buyer, the Seller will
furnish free-of-charge adequate secretarial assistance and
suitable office space, office equipment and facilities in or
conveniently located with respect to the Delivery Location for
the use of not more than four (4) representatives of the Buyer
during the aforementioned period. The Seller will provide
telecommunications facilities at the Buyer's cost to be
invoiced on a monthly basis.
10.
7 - CERTIFICATION
7.1 Type Certification
The A318 aircraft will be and the A319 aircraft has been type
certificated under JAA procedures for joint certification in
the transport category. The Seller will obtain or cause to be
obtained the relevant type certificate (the "Type
Certificate") to allow the issuance of the Certificate of
Airworthiness for Export.
7.2 Certificate of Airworthiness for Export
Subject to the provisions of Clause 7.3, each Aircraft will be
delivered to the Buyer with the Certificate of Airworthiness
for Export which, assuming compliance by the Buyer with all
requirements of the FAA other than those applicable only to
the Aircraft, will entitle the Buyer (or an eligible person
under then applicable law) to obtain at the time of Delivery a
Standard Airworthiness Certificate issued pursuant to Title
14, Part 21 of the U.S. Code of Federal Regulations.
7.3 Specification Changes Before Delivery: Export and Import
Requirements
7.3.1 If, any time before the date on which the Aircraft is Ready
for Delivery, any law, rule or regulation is enacted,
promulgated, becomes effective and/or an interpretation of any
law, rule or regulation is issued that requires any change to
the Specification for the purposes of obtaining the
Certificate of Airworthiness for Export (a "Change in Law"),
the Seller will make the required modification and the parties
hereto will sign an SCN that specifies the effects, if any, on
the guaranteed performances, weights, interchangeability,
Delivery Date, price of the Aircraft and text of the
Specification.
7.3.2 The Seller will as far as practicable (in its sole discretion
and without prejudice to Clause 7.3.3 (ii)) take into account
the information available to it concerning any proposed law,
rule or regulation or interpretation that could become a
Change in Law, in order to minimize the costs of changes to
the Specification as a result of such proposed law, regulation
or interpretation becoming effective before the applicable
Aircraft is Ready for Delivery.
7.3.3 The cost of implementing the modifications referred to in
Clause 7.3.1 above will be
(i) for the account of the Seller if a Change in Law
becomes effective before the date of this Agreement,
and
(ii) shared equally by the Seller and the Buyer if a
Change in Law becomes effective after the date of
this Agreement.
7.3.4 Notwithstanding the provisions of Clauses 7.3.3 (i) and (ii),
if a Change in Law relates to the Propulsion Systems and, in
particular, to engine accessories, quick engine change units
or thrust reversers, the costs will be borne in accordance
with such arrangements as may be made separately between the
Buyer and the Propulsion Systems manufacturer; the Seller will
have no obligation with respect thereto.
7.4 Specification Changes After Delivery
Clause 7.3 will not require the Seller to make any changes or
modifications to, or to make any payments or take any other
action with respect to,any Aircraft that is Ready for Delivery
before the compliance date of any law or regulation referred
to in Clause 7.3. Any such changes or modifications made to an
Aircraft after it is Ready for Delivery will be at the Buyer's
expense.
7.5 Seller's Responsibility
Except as set forth in this Clause 7 and as may be required
under Clause 9.3.1, the Seller will not be required to obtain
any certificate or approval with respect to the Aircraft.
8 - TECHNICAL ACCEPTANCE
8.1 Technical Acceptance Process
8.1.1 Prior to Delivery, the Aircraft will undergo the
Manufacturer's approved technical acceptance process, with
such variations as may be proposed by the Seller and
reasonably acceptable to the Buyer (the "Technical Acceptance
Process"). Satisfactory completion of the Technical Acceptance
Process will demonstrate the satisfactory functioning of the
Aircraft and will be deemed to demonstrate compliance with the
Specification. If the Aircraft fails to complete the Technical
Acceptance Process satisfactorily, the Seller will without
hindrance f rom the Buyer be entitled to carry out any
necessary changes and, as so on as practicable thereafter,
resubmit the Aircraft in order to complete the Technical
Acceptance Process. On any such resubmission, the Technical
Acceptance Process will include such additional tests as are
necessary to demonstrate that the repairs or modifications
have not adversely affected other systems or components of
the Aircraft.
8.1.2 The Technical Acceptance Process will
(i) start on a date notified by the Seller to the Buyer
at least * days in advance,
(ii) take place at the Delivery Location,
(iii) be carried out by the personnel of the Seller, and
(iv) include a technical acceptance flight, which will not
exceed three (3) hours, unless an extended time is
reasonably necessary to demonstrate the satisfactory
functioning of the Aircraft.
8.2 Buyer's Attendance
8.2.1 The Buyer will be entitled to attend the Technical Acceptance
Process.
8.2.2 If the Buyer elects to attend the Technical Acceptance
Process, the Buyer
(i) will cooperate in complying with the reasonable
requirements of the Seller, with the intention of
completing the Technical Acceptance Process within *
Working Days, and
(ii) may have a maximum of four (4) of its representatives
(no more than three (3) of whom will have access to
the cockpit at any one time) accompany the Seller's
representatives on a technical acceptance flight,
during which the Buyer's representatives will comply
with the instructions of the Seller's
representatives.
8.2.3 If the Buyer does not attend or fails to cooperate in the
Technical Acceptance Process, the Seller will be entitled to
complete the Technical Acceptance Process without the Buyer's
attendance, and, * the Buyer will be deemed to have accepted
the Technical Acceptance Process as satisfactory in all
respects. *.
The Seller will make available such data with respect to the
Technical Acceptance Process as the Buyer may reasonably
request.
8.3 Certificate of Acceptance
Upon (i) successful completion of the Technical Acceptance
Process and (ii) issuance of the Certificate of Airworthiness
for Export, the Buyer will, on or before the Delivery Date,
sign and deliver to the Seller a certificate of acceptance in
respect of the Aircraft in the form of Exhibit D (the
"Certificate of Acceptance") hereto.
8.4 Finality of Acceptance
The Buyer's acceptance of delivery of each Aircraft will
constitute waiver by the Buyer of any right it may have under
the Uniform Commercial Code as adopted by the State of New
York or otherwise to revoke such acceptance for any reason,
whether known or unknown to the Buyer at the time of
acceptance.
8.5 Aircraft Utilization
The Seller will, without payment or other liability, be
entitled to use the Aircraft before Delivery if necessary to
obtain the certificates required under Clause 7. Such use will
not, in and of itself, prejudice the Buyer's obligation to
accept Delivery hereunder.
*
9 - DELIVERY
9.1 Delivery Schedule
9.1.1 Subject to Clauses 2, 7, 8, 10 and 18, the Seller will have
the Aircraft Ready for Delivery at the Delivery Location
within the following months (each a "Scheduled Delivery
Month"). Where no month is specified but only a quarter, the
Seller will notify the Buyer of the Scheduled Delivery Month
by * months before the beginning of the quarter.
Firm Aircraft No. Aircraft Type Delivery
----------------- ------------- --------
1 *
2 *
3 *
4 *
5 *
6 *
7 *
8 *
9 *
10 *
11 *
Option Aircraft No. Aircraft Type Delivery
------------------- ------------- --------
1 *
2 *
3 *
4 *
5 *
6 *
7 *
8 *
9 *
9.1.2 The Seller will give the Buyer at least *. Thereafter the
Seller will promptly notify the Buyer of any change in such
date necessitated by the conditions of manufacture or flight.
9.2 Delivery
9.2.1 The Buyer will send its representatives to the Delivery
Location to take Delivery within seven (7) days after the date
notified to it by the Seller in accordance with Clause 9.1.2
above on which the Aircraft is to be Ready for Delivery.
9.2.2 The Seller will transfer title to the Aircraft to the Buyer
free and clear of all liens, claims, charges or encumbrances
of any kind whatsoever, provided that the Balance of the Final
Contract Price has been paid by the Buyer pursuant to Clause
5.4 and that the Certificate of Acceptance has been signed and
delivered to the Seller pursuant to Clause 8.3. The Seller
will provide the Buyer with a ▇▇▇▇ of sale in the form of
Exhibit E hereto and such other documentation confirming
transfer of title and receipt of the Final Contract Price as
may reasonably be requested by the Buyer. Title to, property
interest in and risk of loss or damage to the Aircraft will be
transferred to the Buyer on Delivery.
9.2.3 In respect of each Aircraft that is (a) Ready for Delivery and
(b) has been duly tendered to the Buyer hereunder, should the
Buyer fail to
(i) deliver the signed Certificate of Acceptance to the
Seller on or before the Delivery Date, or
(ii) pay the Balance of the Final Contract Price for the
Aircraft to the Seller on the Delivery Date,
then the Seller will retain title to the Aircraft and the
Buyer will indemnify and hold the Seller harmless against any
and all costs (including but not limited to any parking,
storage and insurance costs) associated with the Buyer's
failure to accept Delivery. It is understood that the Seller
will be obliged only to exercise reasonable care with respect
to the Aircraft following the Buyer's failure to accept
Delivery and will have no duty to park, store or insure the
Aircraft in a manner inconsistent with the Seller's other
business and industrial constraints or obligations.
9.3 Flyaway
9.3.1 The Seller will obtain any licenses, permits or approvals
required for the purpose of exporting the Aircraft from the
Delivery Location, and the Buyer, at its expense, will provide
any reasonably necessary information and assistance.
9.3.2 Subject to Clauses 9.3.1 and 3.3.4 hereof, all expenses of, or
connected with, the post-Delivery flight from the Delivery
Location will be borne by the Buyer. The Buyer will make
direct arrangements with the supplying companies for the fuel
and oil required for all post-Delivery flights.
10 - EXCUSABLE DELAY AND TOTAL LOSS
10.1 Scope of Excusable Delay
Neither the Seller nor the Manufacturer will be responsible
for or be deemed to be in default on account of delays in
delivery or failure to deliver or otherwise in the performance
of this Agreement or any part hereof due to causes reasonably
beyond the Seller's, the Manufacturer's or any Associated
Contractor's control ("Excusable Delay"), including, but not
limited to: (i) acts of God or the public enemy, natural
disasters, fires, floods, storms beyond ordinary strength,
explosions or earthquakes; epidemics or quarantine
restrictions; serious accidents; total or constructive total
loss; any law, decision, regulation, directive or other act
(whether or not having the force of law) of any government or
of the Council of the European Community or the Commission of
the European Community or of any national, Federal, State,
municipal or other governmental department, commission, board,
bureau, agency, court or instrumentality, domestic or foreign;
governmental priorities, regulations or orders affecting
allocation of materials, facilities or a completed Aircraft;
war, civil war or warlike operations, terrorism, insurrection
or riots; failure of transportation; strikes or labor troubles
causing cessation, slow down or interruption of work; delay in
obtaining any airworthiness or type certification; inability
after due and timely diligence to procure materials,
accessories, equipment or parts; general hindrance in
transportation; or failure of a subcontractor or Supplier to
furnish materials, components, accessories, equipment or
parts; (ii) any delay caused directly or indirectly by the
action or inaction of the Buyer; and (iii) delay in delivery
or otherwise in the performance of this Agreement by the
Seller due in whole or in part to any delay in or failure of
the delivery of, or any other event or circumstance relating
to, the Propulsion Systems or Buyer Furnished Equipment.
Notwithstanding the foregoing, Excusable Delays will not
include any delay occasioned by the Seller's, the
Manufacturer's or any Associated Contractor's fault or
negligence.
10.2 Consequences of Excusable Delay
If an Excusable Delay occurs the Seller will
(i) notify the Buyer of such Excusable Delay * as soon as
practicable after becoming aware of the same;
(ii) not be deemed to be in default in the performance of
its obligations hereunder as a result of such
Excusable Delay
(iii) *
(iv) not be responsible for any damages arising from or in
connection with such Excusable Delay suffered or
incurred by the Buyer;
(v) as soon as practicable after the removal of the cause
of the delay resume performance of its obligations
under this Agreement and in particular will notify
the Buyer of the revised Scheduled Delivery Month.
10.3 Termination on Excusable Delay
10.3.1 If the Delivery of any Aircraft is delayed as a result of an
Excusable Delay for a period of more than twelve (12) months
after the last day of the Scheduled Delivery Month, then
either party may terminate this Agreement with respect to the
affected Aircraft, by giving written notice to the other party
within thirty (30) days after the expiration of such twelve
(12)month period. However, the Buyer will not be entitled to
terminate this Agreement pursuant to this Clause if the
Excusable Delay is caused directly or indirectly by the action
or inaction of the Buyer.
10.3.2 In the event that the Seller notifies the Buyer of a revised
Scheduled Delivery Month pursuant to Clause 10.2(v), in
respect of a delay in Delivery of an Aircraft of more than
twelve (12) months after the last day of the Scheduled
Delivery Month, then either party may terminate this Agreement
with respect to the affected Aircraft. Termination will be
made by giving written notice to the other party within thirty
(30) days after the Buyer's receipt of the notice of a revised
Scheduled Delivery Month.
10.3.3 If this Agreement is not terminated under the terms of Clause
10.3.1 or 10.3.2 above, then the Seller will be entitled to
reschedule Delivery. In the case of delays described in Clause
10.3.1, *. In the case of delays described in Clause 10.3.2,
the new Scheduled Delivery Month will be the month specified
in the notice delivered pursuant to Clause 10.2.1 (iv). The
Seller will notify the Buyer of the new Scheduled Delivery
Month after the thirty (30) day period referred to in Clause
10.3.1 or 10.3.2, and this new Scheduled Delivery Month will
be deemed to be an amendment to the applicable Scheduled
Delivery Month in Clause 9.1.1 of the Agreement.
10.4 Total Loss: Lost, Destroyed or Damaged Aircraft
If, before delivery thereof, an Aircraft is lost, destroyed
or, in the reasonable opinion of the Seller, damaged beyond
economic repair ("Total Loss"), then the Seller will notify
the Buyer to this effect as soon as reasonably possible. The
Seller will include in its notice, or as soon after the notice
as possible, a revised Scheduled Delivery Month, which will be
the earliest date that an aircraft to replace the Aircraft may
be delivered to the Buyer consistent with the Seller's other
obligations and production capabilities. However, in the event
the specified revised Scheduled Delivery Month is more than
twelve (12) months after the last day of the original
Scheduled Delivery Month, then this Agreement will terminate
with respect to such Aircraft unless the Buyer notifies the
Seller within one (1) month of the date of receipt of the
Seller's notice that it desires the Seller to provide a
replacement aircraft during the month quoted in the Seller's
notice, in which case the parties will execute an amendment to
this Agreement recording the variation in the Scheduled
Delivery Month. The other terms and conditions of this
Agreement applicable to such Aircraft will apply to the
replacement aircraft.
Notwithstanding the above, nothing herein will require the
Seller to manufacture and deliver a replacement aircraft if
manufacture would require the reactivation of the
Manufacturer's production line for the model or series of
aircraft that includes the Aircraft.
10.5 Termination Rights Exclusive
In the event that this Agreement is terminated as provided for
under the terms of Clauses 10.3 or 10.4, such termination will
discharge all obligations and liabilities of the parties
hereunder with respect to such affected Aircraft and
undelivered material, services, data or other items applicable
thereto and to be furnished hereunder and neither party will
have any claim against the other for any loss resulting from
such nondelivery, *. The Seller will in no circumstances have
any liability whatsoever for Excusable Delay other than as set
forth in this Clause 10.
10.6 REMEDIES
THIS CLAUSE 10 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE
BUYER FOR EXCUSABLE DELAYS OR FAILURE TO DELIVER DUE TO TOTAL
LOSS, AND THE BUYER HEREBY WAIVES ALL RIGHTS TO WHICH IT WOULD
OTHERWISE BE ENTITLED IN RESPECT THEREOF, INCLUDING, WITHOUT
LIMITATION, ANY RIGHTS TO INCIDENTAL AND CONSEQUENTIAL DAMAGES
OR SPECIFIC PERFORMANCE. THE BUYER WILL NOT BE ENTITLED TO
CLAIM THE REMEDIES AND RECEIVE THE BENEFITS PROVIDED IN THIS
CLAUSE 10 TO THE EXTENT THE DELAY REFERRED TO IN THIS CLAUSE
10 IS CAUSED BY THE NEGLIGENCE OR FAULT OF THE BUYER OR ITS
REPRESENTATIVES.
11 - INEXCUSABLE DELAY
11.1 Liquidated Damages
Should an Aircraft not be Ready for Delivery to the Buyer
within thirty (30) days after the * last day of the Scheduled
Delivery Month (as such month may be changed pursuant to
Clauses 2, 7 or 10) (*, the "Delivery Period"), and such delay
is not as a result of Excusable Delay or Total Loss, then such
delay will be termed an "Inexcusable Delay," and the Buyer
will have the right to claim, and the Seller will pay the
Buyer, liquidated damages of US $ * (US dollars--* ) for each
day of Inexcusable Delay, starting on the first day after the
Delivery Period.
The amount of liquidated damages will in no event exceed the
total of US $ * (US dollars-- *) in respect of any one
Aircraft.
The Buyer's right to liquidated damages in respect of an
Aircraft is conditional on the Buyer's submitting a written
claim for liquidated damages to the Seller, as applicable, not
later than (i) thirty (30) days after Delivery or (ii) thirty
(30) days after a termination under Clause 11.3 below.
11.2 Renegotiation
If as a result of an Inexcusable Delay, Delivery does not
occur within six (6) months after the Delivery Period, the
Buyer will have the right, exercisable by written notice to
the Seller given between fifteen (15) days and one (1) month
after the six (6) months, to require from the Seller a
renegotiation of the Scheduled Delivery Month for the affected
Aircraft. Unless otherwise agreed between the Seller and the
Buyer during such renegotiation, the said renegotiation will
not prejudice the Buyer's right to receive liquidated damages
in accordance with Clause 11.1 during the period of
Inexcusable Delay.
11.3 Termination
If as a result of an Inexcusable Delay, Delivery does not
occur within twelve (12) months after the Delivery Period and
the parties have not renegotiated the Delivery Date pursuant
to Clause 11.3, then both parties will have the right,
exercisable by written notice to the other party, given
between one (1) and two (2) months after the twelve (12)
months, to terminate this Agreement in respect of the affected
Aircraft. In the event of termination pursuant to this Clause
11.2, neither party will have any claim against the other,
except that the Seller will pay to the Buyer, any amounts due
pursuant to Clause 11.1 and will pay the Buyer an amount equal
to the Predelivery Payments received from the Buyer in respect
of the affected Aircraft.
11.4 Setoff Payments
Notwithstanding anything to the contrary contained herein, the
Seller will have the right to apply any and all sums
previously paid by the Buyer to the Seller with respect to a
terminated Aircraft to the payment of any other amounts the
Buyer owes the Seller or any Affiliate thereof under any
agreement between them, before being required to make any
payments under 11.1 or 11.3.
11.5 REMEDIES
THIS CLAUSE 11 SETS FORTH THE SOLE AND EXCLUSIVE REMEDY OF THE
BUYER FOR DELAYS IN DELIVERY OR FAILURE TO DELIVER ONE OR MORE
AIRCRAFT UNDER THIS AGREEMENT, OTHER THAN (A) SUCH DELAYS AS
ARE COVERED BY CLAUSE 10, AND *, THE BUYER HEREBY WAIVES ALL
RIGHTS TO WHICH IT WOULD OTHERWISE BE ENTITLED IN RESPECT
THEREOF, INCLUDING WITHOUT LIMITATION ANY RIGHTS TO INCIDENTAL
OR CONSEQUENTIAL DAMAGES OR SPECIFIC PERFORMANCE. THE BUYER
WILL NOT BE ENTITLED TO CLAIM THE REMEDIES AND RECEIVE THE
BENEFITS PROVIDED IN THIS CLAUSE 11 WHERE THE DELAY REFERRED
TO IN THIS CLAUSE 11 IS CAUSED BY THE NEGLIGENCE OR FAULT OF
THE BUYER OR ITS REPRESENTATIVES.
12 - WARRANTIES AND SERVICE LIFE POLICY
The Seller represents and warrants that the Manufacturer has
provided to the Seller the following Warranty, Service Life
Policy, Supplier Warranties and Interface Commitment with
respect to the Aircraft, subject to the terms, conditions,
limitations and restrictions (including, but not limited to,
the Exclusivity of Warranties and General Limitations of
Liability and Duplicate Remedies provisions) as hereinafter
set out, and that the same are in full force and effect and
have not been amended. The Seller hereby assigns to the Buyer,
and the Buyer hereby accepts, all of the Seller's rights and
obligations as the "Buyer" under the said Warranty, Service
Life Policy, Supplier Warranties and Interface Commitment, and
the Seller subrogates the Buyer to all such rights and
obligations in respect of the Aircraft. The Seller hereby
warrants to the Buyer that (i) it has all requisite authority
to make the foregoing assignment to and to effect the
foregoing subrogation in favor of the Buyer, (ii) such
assignment and subrogation are effective to confer on the
Buyer all of the foregoing rights and obligations of the
Seller, and (iii) the Seller will not enter into any amendment
of the provisions so assigned without the prior written
consent of the Buyer.
It is understood that, in the provisions below between the
words QUOTE and UNQUOTE, capitalized terms have the meanings
assigned thereto in this Agreement, except that (i) the term
"Seller," which means the Manufacturer as between the
Manufacturer and the Seller, also means the Manufacturer in
this Agreement, and (ii) the term "Buyer," which means the
Seller as between the Manufacturer and the Seller, means the
Buyer in this Agreement.
QUOTE
12.1 WARRANTY
12.1.1 Nature of Warranty
Subject to the limitations and conditions as hereinafter
provided, and except as provided in Clause 12.1.2, the Seller
warrants to the Buyer that each Aircraft and each Warranted
Part will at the time of delivery to the Buyer:
(i) be free from defects in material,
(ii) be free from defects in workmanship, including,
without limitation, processes of manufacture,
(iii) be free from defects in design (including, without
limitation, selection of materials) having regard to
the state of the art at the date of such design, and
(iv) be free from defects arising from failure to conform
to the Specification, except as to those portions
of the Specification that are expressly stated in
the Specification to be estimates or approximations
or design aims.
For the purposes of this Agreement, the term "Warranted Part"
will mean any Seller proprietary component, equipment,
accessory or part that at the time of delivery of an Aircraft
(a) is installed on such Aircraft, (b) is manufactured to the
detail design of the Seller or a subcontractor of it and (c)
bears a part number of the Seller.
12.1.2 Exceptions
The warranties set forth in Clause 12.1.1 will not apply to
Buyer Furnished Equipment, nor to the Propulsion Systems, nor
to any component, accessory, equipment or part purchased by
the Buyer that is not a Warranted Part, provided, however,
that:
(i) any defect in the Seller's workmanship in respect of
the installation of such items in the Aircraft,
including any failure by the Seller to conform to the
installation instructions of the manufacturers of
such items that invalidates any applicable warranty
from such manufacturers, will constitute a defect in
workmanship for the purpose of this Clause 12.1 and
be covered by the warranty set forth in Clause
12.1.1(ii), and
(ii) any defect inherent in the Seller's design of the
installation, in view of the state of the art at the
date of such design, that impairs the use of such
items will constitute a defect in design for the
purposes of this Clause 12.1 and be covered by the
warranty set forth in Clause 12.1.1(iii).
12.1.3 Warranty Periods
The warranties described in Clauses 12.1.1 and 12.1.2
hereinabove will be limited to those defects that become
apparent within thirty-six (36) months after delivery of the
affected Aircraft.
12.1.4 Limitations of Warranty
12.1.4.1 The Buyer's remedy and the Seller's obligation and liability
under Clauses 12.1.1 and 12.1.2 hereinabove are limited to, at
the Seller's expense and option, the repair, replacement or
correction of, or the supply of modification kits rectifying
the defect to any defective Warranted Part. Alternatively,
the Seller may, at its option and with the Buyer's consent,
furnish a credit to the Buyer for the future purchase of goods
and services (not including Aircraft) equal to the price at
which the Buyer is then entitled to acquire a replacement for
the defective Warranted Part. Nothing herein contained will
obligate the Seller to correct any failure to conform to the
Specification with respect to components, equipment,
accessories or parts that the parties agree in a writing other
than the Certificate of Acceptance at the time of delivery of
the affected Aircraft are acceptable deviations or have no
material adverse effect on the use, operation or performance
of an Aircraft.
12.1.4.2 In the event that the Seller corrects a defect covered by
Clause 12.1.1(iii) that becomes apparent within the applicable
period set forth in Clause 12.1.3, the Seller will also, if so
requested by the Buyer in writing, make such correction in any
Aircraft that has not already been delivered to the Buyer.
However, the Seller will not be responsible nor deemed to be
in default on account of any delay in delivery of any Aircraft
or otherwise, in respect of performance of this Agreement, due
to the Seller's undertaking to make such correction and,
rather than accept a delay in delivery of any such Aircraft,
the Buyer and the Seller may agree to deliver such Aircraft
with subsequent correction of the defect by the Buyer at the
Seller's expense, or the Buyer may elect to accept delivery
and thereafter file a Warranty Claim as though the defect had
become apparent immediately after delivery of such Aircraft.
12.1.5 Warranty Claim Requirements
The Buyer's remedy and the Seller's obligation and liability
under this Clause 12.1, with respect to each claimed defect,
are subject to the following conditions precedent:
(i) the existence of a defect covered by the provisions
of this Clause 12.1,
(ii) the Buyer's having submitted to the Seller proof
reasonably satisfactory to the Seller of the
existence of a defect covered by the provisions of
this Clause 12.1,
(iii) the defect's having become apparent within the
applicable warranty period, as set forth in Clause
12.1.3,
(iv) the defect's not having resulted from any act or
omission of the Buyer, including, but not limited to,
any failure to operate and maintain the affected
Aircraft or part thereof in accordance with the
standards or any matter set forth or covered in
Clause 12.1.10,
(v) the Buyer's having returned as soon as reasonably
practicable the Warranted Part claimed to be
defective to such repair facilities as may be
designated by the Seller, except where the Buyer
elects to repair a defective Warranted Part in
accordance with the provisions of Clause 12.1.7, and
(vi) the Seller's having received a Warranty Claim
fulfilling the conditions of and in accordance with
the provisions of Clause 12.1.6 below.
12.1.6 Warranty Administration
The warranties set forth in Clause 12.1 will be administered
as hereinafter provided:
(i) Claim Determination
Warranty Claim determination by the Seller will be
reasonably based on the claim details, reports from
the Seller's representative, historical data logs,
inspections, tests, findings during repair, defect
analysis and other suitable documents and
information.
(ii) Transportation Costs
Transportation costs associated with the sending of a
Warranted Part claimed to be defective to the
facilities designated by the Seller will be borne by
the Buyer. *.
(iii) Return of an Aircraft
If an Aircraft must be returned to the Seller's
facility or to a repair facility designated by the
Seller for accomplishment of a warranted repair or
correction, pursuant to a Warranty Claim, *.
If the Seller desires to accomplish a warranted
repair or correction at the Buyer's facilities in
Denver or wherever the Aircraft is located and the
Buyer nevertheless desires to return the Aircraft to
the Seller for such repair or correction, the Seller
will designate the facility where the repair will be
accomplished, and the Buyer will pay the costs of the
ferry flights to and from such facility.
(iv) On-Aircraft Work by the Seller
If the work to accomplish a repair or correction
pursuant to a Warranty Claim must be accomplished by
a Seller working party, the Seller will be
responsible for all costs of labor and material *.
If such repair or correction is not required to be
accomplished by a Seller working party, but the Buyer
nevertheless desires a Seller working party to
accomplish the same, the Seller will be responsible
for all costs of labor and material *.
If the repair or correction is performed by a Seller
working party, the Seller and the Buyer will agree on
a schedule and place for the work to be performed.
(v) Warranty Claim Substantiation
For each claim under this Clause 12.1 the Buyer will
give written notice to the Seller that contains at
least the data listed below with respect to a part or
Aircraft, as applicable ("Warranty Claim"). The Buyer
will * give the Seller such Warranty Claim within
sixty (60) days of discovering the defect giving rise
to such Warranty Claim, *.
(a) Description of defect and action taken, if
any.
(b) Date of incident and/or of removal.
(c) Description of the defective part.
(d) Part number.
(e) Serial number (if applicable).
(f) Position on Aircraft, according to Catalog
Sequence Number (CSN) of the Illustrated
Parts Catalog, Component Maintenance Manual
or Structural Repair Manual (as such
documents are defined in Clause 14 and
Exhibit F hereto) as applicable.
(g) Total flying hours or calendar times, as
applicable, at the date of appearance of a
defect.
(h) Time since last shop visit at the date of
defect appearance.
(i) Manufacturer's serial number of the Aircraft
and/or its registration number.
(j) Aircraft total flying hours and/or number of
landings at the date of defect appearance.
(k) Claim number.
(l) Date of claim.
(m) Date of delivery of an Aircraft or part to
the Buyer.
Claims are to be addressed as follows:
AIRBUS INDUSTRIE
CUSTOMER SERVICE DIVISION SG-C
WARRANTY ADMINISTRATION
1, ROND-POINT ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇.▇. ▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇
(vi) Replacements
Replacements made pursuant to this Clause 12.1 will
be made within the lead time defined in the Seller's
Spare Parts Price Catalog. Replaced components,
equipment, accessories or parts will become the
Seller's property. The Seller will * to expedite
replacement upon the Buyer's request.
Title to and risk of loss of any Aircraft, component,
accessory, equipment or part returned by the Buyer to
the Seller will at all times remain with the Buyer,
except that (i) when the Seller has possession of a
returned Aircraft, component, accessory, equipment or
part to which the Buyer has title, the Seller will
have such responsibility therefor as is chargeable by
law to a bailee for hire, but the Seller will not be
liable for loss of use, and (ii) title to and risk of
loss of a returned component, accessory, equipment or
part will pass to the Seller on shipment by the
Seller to the Buyer of any item furnished by the
Seller to the Buyer as a replacement therefor. Upon
the Seller's shipment to the Buyer of any replacement
component, accessory, equipment or part provided by
the Seller pursuant to this Clause 12.1, title to and
risk of loss of such component, accessory, equipment
or part will pass to the Buyer.
(vii) Rejection
The Seller will provide reasonable written
substantiation in case of rejection of a Warranty
Claim. The Buyer will (a) pay to the Seller
reasonable inspection and test charges incurred by
the Seller in connection with the investigation and
processing of a rejected Warranty Claim and (b) pay
the costs of transportation to the ASCO Spares Center
in Ashburn, VA, insurance, and any other costs
associated with the sending of any Warranted Part or
any other item, equipment, component or part for
which the Seller rejects the Buyer's Warranty Claim.
(viii) Inspection
The Seller will have the right to inspect the
affected Aircraft and documents and other records
relating thereto in the event of any Warranty Claim
under this Clause 12.1.
12.1.7 In-house Warranty
(i) Authorization
The Buyer is hereby authorized to perform the repair of
Warranted Parts, subject to the terms of this Clause 12.1.7
("In-house Warranty"). When the estimated cost of an In-house
Warranty repair exceeds $* (US dollars-- *), the Buyer will
notify the Seller's representative of its decision to perform
any in-house repairs before such repairs are commenced. The
Buyer's notice will include sufficient detail regarding the
defect, estimated labor hours and material to allow the Seller
to ascertain the reasonableness of the estimate. The Seller
will use reasonable efforts to ensure a prompt response and
will not unreasonably withhold authorization.
(ii) Conditions of Authorization
The Buyer will be entitled to the benefits under this Clause
12.1.7 for repair of Warranted Parts
(a) only if adequate facilities and qualified
personnel are available to the Buyer,
(b) provided that repairs are to be performed
in accordance with the Seller's written
instructions set forth in applicable
Technical Data and Documentation, and
(c) only to the extent specified by the Seller,
or, in the absence of the Seller's
specifying, to the extent reasonably
necessary to correct the defect, in
accordance with the standards set forth in
Clause 12.1.10.
(iii) Seller's Rights
The Seller will have the right to have any Warranted Part, or
any part removed therefrom, which is claimed to be defective,
returned to the Seller, as set forth in Clause 12.1.6(ii), if,
in the judgment of the Seller, the nature of the defect
requires technical investigation.
The Seller will further have the right to have a
representative present during the disassembly, inspection and
testing of any Warranted Part claimed to be defective, subject
to its presence being practical and not unduly delaying the
repair.
(iv) n-house Warranty Claim Substantiation
Claims for In-house Warranty credit will be filed within the
time period set forth in, and will contain the same
information required in, Warranty Claims under Clause
12.1.6(v) and in addition will include:
(a) a report of technical findings with respect
to the defect,
(b) for parts required to remedy the defect:
- part numbers,
- serial numbers (if applicable),
- description of the parts,
- quantity of parts,
- unit price of parts,
- total price of parts,
- related Seller's or third party's invoices
(if applicable),
(c) detailed number of labor hours,
(d) agreed In-house Warranty Labor Rate (defined
below in Clause 12.1.7(v) (a)), and
(e) total claim value.
(v) Credit
The Buyer's sole remedy, and the Seller's sole obligation and
liability, in respect of In-house Warranty claims, will be a
credit to the Buyer's account. The credit to the Buyer's
account will be equal to the direct labor cost expended in
performing a repair and to the direct cost of materials
incorporated in the repair. Such costs will be determined as
set forth below.
(a) To determine direct labor costs, only manhours spent
on disassembly, inspection, repair, reassembly, and
final inspection and test (including flight tests if
flight tests prove necessary to complete a repair
under the In-house Warranty) of the Warranted Part
alone will be counted. Manhours required for
maintenance work concurrently being carried out on
the Aircraft or Warranted Part will not be included.
The manhours counted as set forth above will be
multiplied by an agreed hourly labor rate of US$ *
(US dollars--*) at economic conditions prevailing in
January 1999 (the "In-house Warranty Labor Rate").
The In-house Warranty Labor Rate is subject to
adjustment annually by multiplying by the ratio
HEn/HEb. For the purposes of this Subclause 12.1.7(v)
only, HEn is equal to the Labor Index defined in
Exhibit G hereto for January of the year in which
manhours are spent and HEb is equal to such Labor
Index for January 1999.
(b) Direct material costs are determined by the prices at
which the Buyer acquired such material, excluding any
parts and materials used for overhaul furnished free
of charge by the Seller.
(vi) Limitation on Credit
The Buyer will in no event be credited for repair costs (labor
and material) for any Warranted Part to the extent that such
costs exceed
(a) sixty-five percent (65%) of the Seller's current
catalog price for a replacement of such defective
Warranted Part,
(b) repair costs (labor and material) that would have
resulted if repairs had been carried out at the
Seller's facilities or
(c) $* (US dollars-- *), unless the repair has been
previously approved by the Seller in accordance with
Clause 12.1.7(ii).
(vii) Scrapped Material
The Buyer may, with the agreement of the Seller's Resident
Customer Support Representative, scrap any such defective
parts that are beyond economic repair and not required for
technical evaluation.
If the Buyer does not obtain the agreement of the Seller's
Resident Customer Support Representative to scrap a Warranted
Part defective beyond economic repair, then the Buyer will
retain such Warranted Part and any defective part removed from
a Warranted Part during repair for a period of either * days
after the date of completion of repair or * days after
submission of a claim for In-house Warranty credit relating
thereto, whichever is longer. Such parts will be returned to
the Seller within * days of receipt of the Seller's request to
that effect.
Scrapped Warranted Parts will be evidenced by a record of
scrapped material certified by an authorized representative of
the Buyer, which will be kept in the Buyer's file for at least
the duration of the warranty periods set forth in this Clause
12.1.
(viii) DISCLAIMER OF SELLER LIABILITY FOR BUYER'S REPAIR
THE SELLER WILL NOT BE LIABLE FOR ANY RIGHT, CLAIM OR REMEDY,
AND THE BUYER WILL INDEMNIFY THE SELLER AGAINST THE CLAIMS OF
ANY THIRD PARTIES OTHER THAN THE MANUFACTURER AND THE
ASSOCIATED CONTRACTORS AND AFFILIATES OF THE FOREGOING, AND
THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
(EACH AN "EXCLUDED PERSON"), FOR PERSONAL INJURIES, DEATH OR
PROPERTY LOSSES DUE TO ANY DEFECT, NONCONFORMANCE OF ANY KIND,
ARISING OUT OF OR IN CONNECTION WITH ANY REPAIR OF WARRANTED
PARTS UNDERTAKEN BY THE BUYER UNDER THIS SUBCLAUSE 12.1.7 OR
ANY OTHER ACTIONS UNDERTAKEN BY THE BUYER UNDER THIS SUBCLAUSE
12.1.7, WHETHER SUCH CLAIM IS ASSERTED IN CONTRACT OR IN TORT,
OR IS PREMISED ON ALLEGED, ACTUAL, IMPUTED OR ORDINARY
NEGLIGENCE OR INTENTIONAL ACTS OR OMISSIONS OF THE BUYER OR
THE SELLER, PROVIDED THAT THE FOREGOING INDEMNITY WILL NOT
APPLY TO THE EXTENT THAT ANY SUCH CLAIM IS CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF THE SELLER OR ANY EXCLUDED
PERSON.
12.1.8 Warranty Transferability
The warranties provided for in this Clause 12.1 for any
Warranted Part will accrue to the benefit of any airline in
revenue service other than the Buyer, if the Warranted Part
enters into the possession of any such airline as a result of
a pooling agreement between such airline and the Buyer, in
accordance with the terms and subject to the limitations and
exclusions of the foregoing warranties and to applicable laws
or regulations.
12.1.9 Warranty for Corrected, Replacement or Repaired Warranted Part
Whenever any Warranted Part that contains a defect for which
the Seller is liable under Clause 12.1 has been corrected,
repaired or replaced pursuant to the terms of this Clause 12,
the period of the Seller's warranty with respect to such
corrected, repaired or replacement Warranted Part, whichever
may be the case, will be the remaining portion of the original
warranty in respect of such corrected, repaired or replacement
Warranted Part. In the event that a defect is attributable to
a defective repair or replacement by the Buyer, a Warranty
Claim with respect to such defect will not be allowable,
notwithstanding any subsequent correction or repair, and will
immediately terminate the remaining warranties under this
Clause 12.1 in respect of the affected Warranted Part, unless
such defective repair is caused solely by an error in the
Seller's written repair instructions.
12.1.10 Good Airline Operation - Normal Wear and Tear
The Buyer's rights under this Clause 12.1 are subject to the
Aircraft and each component, equipment, accessory and part
thereof being maintained, overhauled, repaired and operated in
accordance with good commercial airline practice, all
technical documentation and any other instructions issued by
the Seller, the Suppliers or the manufacturer of the
Propulsion Systems and all applicable rules, regulations and
directives of the relevant Aviation Authorities.
The Seller's liability under this Clause 12.1 will not extend
to normal wear and tear nor to
(i) any Aircraft or component, equipment, accessory or
part thereof that has been repaired, altered or
modified after delivery by any party in a manner
other than that approved by the Seller;
(ii) any Aircraft or component, equipment, accessory or
part thereof that has been operated in a damaged
state; or
(iii) any component, equipment, accessory or part from
which the trademark, trade name, part or serial
number or other identification marks have been
removed.
The foregoing limitation of the Seller's liability will not
apply in the cases of Clause 12.1.10(i) and Clause 12.1.10(ii)
above if the Buyer submits evidence satisfactory to the Seller
that the defect did not arise from nor was contributed to by
either of said causes.
12.2 SELLER SERVICE LIFE POLICY
12.2.1 Scope and Definitions
In addition to the warranties set forth in Clause 12.1 above,
the Seller further agrees that should a Failure occur in any
Item, then, subject to the general conditions and limitations
set forth in Clause 12.2.4 below, the provisions of this
Clause 12.2 will apply.
For the purposes of this Clause 12.2, the following
definitions will apply:
(i) "Item" means any of the Seller components, equipment,
accessories or parts listed in Exhibit C hereto which
are installed on an Aircraft at any time during the
period of effectiveness of the Service Life Policy as
defined below in Clause 12.2.2.
(ii) "Failure" means any breakage of, or defect in, an
Item that materially impairs the utility or safety of
the Item, provided that (a) any such breakage of, or
defect in, any Item did not result from any breakage
or defect in any other Aircraft part or component or
from any other extrinsic force and (b) has occurred
or can reasonably be expected to occur on a
repetitive or fleetwide basis.
12.2.2 Periods and Seller's Undertaking
Subject to the general conditions and limitations set forth in
Clause 12.2.4 below, the Seller agrees that if a Failure
occurs in an Item before the Aircraft in which such Item is
installed has completed * (*) flight cycles or within * (*)
years after the delivery of the applicable Aircraft to the
Buyer, whichever occurs first, the Seller will, at its own
discretion, as promptly as practicable and for a price that
reflects the Seller's financial participation as hereinafter
provided, either:
(i) design and furnish to the Buyer a correction for such
Item subject to a Failure and provide any parts
required for such correction (including Seller
designed standard parts but excluding industry
standard parts), or,
(ii) replace such Item.
12.2.3 Seller's Participation in the Cost
Any part or Item that the Seller is required to furnish to the
Buyer under this Service Life Policy in connection with the
correction or replacement of an Item will be furnished to the
Buyer at the Seller's current sales price therefor, less the
Seller's financial participation, which will be determined in
accordance with the following formula:
C (N - T)
------------
P = N
where
P: financial participation of the Seller,
C: the Seller's then current sales price for the
required Item or required Seller designed parts,
and,
(i) T: total number of flight cycles since delivery
that have been accumulated by the particular
Aircraft in which the Item subject to a
Failure was originally installed,
and,
N: * flight cycles,
or,
(ii) T: total time in months since delivery of the
particular Aircraft in which the Item
subject to a Failure was originally
installed,
and,
N: * months,
whichever of the foregoing clauses (i) and (ii) yields the lower ratio of:
N - T
N
12.2.4 General Conditions and Limitations
12.2.4.1 Notwithstanding Clause 12.2.3, the undertakings given in this
Clause 12.2 will not be valid during the warranty period
applicable to an Item under Clause 12.1.3.
12.2.4.2 The Buyer's remedy and the Seller's obligation and liability
under this Service Life Policy are subject to compliance by
the Buyer with the following conditions precedent:
(i) The Buyer will maintain log books and other
historical records with respect to each Item adequate
to enable the Seller to determine whether the alleged
Failure is covered by this Service Life Policy and,
if so, to define the portion of the cost to be borne
by the Seller in accordance with Clause 12.2.3 above.
(ii) The Buyer will keep the Seller informed of any
significant incidents relating to an Aircraft,
howsoever occurring or recorded.
(iii) The conditions of Clause 12.1.10 will have been
complied with.
(iv) The Buyer will carry out specific structural
inspection programs for monitoring purposes as may be
established from time to time by the Seller. Such
programs will be, to the extent possible, compatible
with the Buyer's operational requirements and will be
carried out at the Buyer's expense. Reports relating
thereto will be regularly furnished to the Seller.
(v) In the case of any breakage or defect, the Buyer will
* to report the same in writing to the Seller within
*, after any breakage or defect in an Item becomes
apparent, whether or not said breakage or defect can
reasonably be expected to occur in any other
Aircraft, and the Buyer will inform the Seller in
sufficient detail about the breakage or defect to
enable the Seller to determine whether said breakage
or defect is subject to this Service Life Policy.
12.2.4.3 Except as otherwise provided in this Clause 12.2, any claim
under this Service Life Policy will be administered as
provided in, and will be subject to the terms and conditions
of, Clause 12.1.6.
12.2.4.4 In the event that the Seller has issued a modification
applicable to an Aircraft, the purpose of which is to avoid a
Failure, the Seller may elect to supply the necessary
modification kit free of charge or under a pro rata formula
established by the Seller. If such a kit is so offered to the
Buyer, then, in respect of such Failure and any Failures that
could ensue therefrom, the validity of the Seller's commitment
under this Clause 12.2 will be subject to the Buyer's
incorporating such modification in the relevant Aircraft,
within a reasonable time, as promulgated by the Seller and in
accordance with the Seller's instructions.
12.2.4.5 THIS SERVICE LIFE POLICY IS NEITHER A WARRANTY, PERFORMANCE
GUARANTEE, NOR AN AGREEMENT TO MODIFY ANY AIRCRAFT OR AIRFRAME
COMPONENTS TO CONFORM TO NEW DEVELOPMENTS OCCURRING IN THE
STATE OF AIRFRAME DESIGN AND MANUFACTURING ART. THE SELLER'S
OBLIGATION UNDER THIS SUBCLAUSE 12.2 IS TO MAKE ONLY THOSE
CORRECTIONS TO THE ITEMS OR FURNISH REPLACEMENTS THEREFOR AS
PROVIDED IN THIS SUBCLAUSE 12.2. THE BUYER'S SOLE REMEDY AND
RELIEF FOR THE NONPERFORMANCE OF ANY OBLIGATION OR LIABILITY
OF THE SELLER ARISING UNDER OR BY VIRTUE OF THIS SERVICE LIFE
POLICY WILL BE IN MONETARY DAMAGES, LIMITED TO THE AMOUNT THE
BUYER REASONABLY EXPENDS IN PROCURING A CORRECTION OR
REPLACEMENT FOR ANY ITEM THAT IS THE SUBJECT OF A FAILURE
COVERED BY THIS SERVICE LIFE POLICY AND TO WHICH SUCH
NONPERFORMANCE IS RELATED, LESS THE AMOUNT THAT THE BUYER
OTHERWISE WOULD HAVE BEEN REQUIRED TO PAY UNDER THIS SUBCLAUSE
12.2 IN RESPECT OF SUCH CORRECTED OR REPLACEMENT ITEM.
WITHOUT LIMITING THE EXCLUSIVITY OF WARRANTIES AND GENERAL
LIMITATIONS OF LIABILITY PROVISIONS SET FORTH IN SUBCLAUSE
12.5, THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ALL
CLAIMS TO ANY FURTHER DIRECT, INCIDENTAL OR CONSEQUENTIAL
DAMAGES, INCLUDING LOSS OF PROFITS AND ALL OTHER RIGHTS,
CLAIMS AND REMEDIES, ARISING UNDER OR BY VIRTUE OF THIS
SERVICE LIFE POLICY.
12.2.5 Transferability
Except as specifically provided for in Clause 20 of this
Agreement, the Buyer's rights under this Clause 12.2 will not
be assigned, sold, leased, transferred or otherwise alienated
by operation of law or otherwise, without the Seller's prior
written consent.
Any unauthorized assignment, sale, lease, transfer or other
alienation of the Buyer's rights under this Service Life
Policy will, as to the particular Aircraft involved,
immediately void this Service Life Policy in its entirety.
12.3 SUPPLIER WARRANTIES
12.3.1 Seller's Support
Prior to delivery of the first Aircraft, the Seller will
provide the Buyer with the warranties, service life policies
and patent indemnities that the Seller has obtained pursuant
to the Supplier Product Support Agreements.
12.3.2 Supplier's Default
12.3.2.1 In the event that any Supplier under any warranty obtained by
the Seller pursuant to Clause 12.3.1 hereof defaults in the
performance of any material obligation under such warranty
with respect to a Supplier Part, and the Buyer submits within
a reasonable time to the Seller reasonable proof that such
default has occurred, then Clause 12.1 of this Agreement will
apply to the extent it would have applied had such Supplier
Part been a Warranted Part except that, for obligations
covered under Clause 12.1, the shorter of (i) the Supplier's
warranty period indicated in the Supplier Product Support
Agreements manual and (ii) the Seller's warranty period
indicated in Clause 12.1.3 of this Agreement will apply.
12.3.2.2 In the event that any Supplier under any Supplier service life
policy obtained by the Seller pursuant to Clause 12.3.1 hereof
defaults in the performance of any material obligation with
respect thereto, and the Buyer submits within reasonable time
to the Seller reasonable proof that such default has occurred,
then Clause 12.2 of this Agreement will apply to the extent
the same would have applied had such component, equipment,
accessory or part been listed in Exhibit C hereto.
12.3.2.3 At the Seller's request, the Buyer will assign to the Seller,
and the Seller will be subrogated to, all of the Buyer's
rights against the relevant Supplier, with respect to and
arising by reason of such default and the Buyer will provide
reasonable assistance to enable the Seller to enforce the
rights so assigned.
12.4 INTERFACE COMMITMENT
12.4.1 Interface Problem
If the Buyer experiences any technical problem in the
operation of an Aircraft or its systems due to a malfunction,
the cause of which, after due and reasonable investigation, is
not readily identifiable by the Buyer, but which the Buyer
reasonably believes to be attributable to the design
characteristics of one or more components of the Aircraft (an
"Interface Problem"), the Seller will, if requested by the
Buyer, and without additional charge to the Buyer, except for
transportation of the Seller's personnel to the Buyer's
facilities, promptly conduct or have conducted an
investigation and analysis of such problem to determine, if
possible, the cause or causes of the problem and to recommend
such corrective action as may be feasible, provided, however,
that if it is determined, after such due and reasonable
investigation, that the Interface Problem was due to or caused
by any act or omission of the Buyer in its performance of its
obligations hereunder, the Buyer will pay to the Seller *. The
Buyer will furnish to the Seller all data and information in
the Buyer's possession relevant to the Interface Problem and
will cooperate with the Seller in the conduct of the Seller's
investigations and such tests as may be required. At the
conclusion of such investigation the Seller will promptly
advise the Buyer in writing of the Seller's opinion as to the
cause or causes of the Interface Problem and the Seller's
recommendations as to corrective action.
12.4.2 Seller's Responsibility
If the Seller determines that the Interface Problem is
primarily attributable to the design of a Warranted Part, the
Seller will, if requested by the Buyer, correct the design of
such Warranted Part, pursuant to the terms and conditions of
Clause 12.1.
12.4.3 Supplier's Responsibility
If the Seller determines that the Interface Problem is
primarily attributable to the design of any Supplier Part, the
Seller will, if requested by the Buyer, reasonably assist the
Buyer in processing any warranty claim the Buyer may have
against the manufacturer of such Supplier Part.
12.4.4 Joint Responsibility
If the Seller determines that the Interface Problem is
attributable partially to the design of a Warranted Part and
partially to the design of any Supplier Part, the Seller will,
if requested by the Buyer, seek a solution to the Interface
Problem through cooperative efforts of the Seller and any
Supplier involved. The Seller will promptly advise the Buyer
of any corrective action proposed by the Seller and any such
Supplier. Such proposal will be consistent with any then
existing obligations of the Seller hereunder and of any such
Supplier to the Buyer. Such corrective action, unless
reasonably rejected by the Buyer, will constitute full
satisfaction of any claim the Buyer may have against either
the Seller or any such Supplier with respect to such Interface
Problem.
12.4.5 General
12.4.5.1 All requests under this Clause 12.4 will be directed both to
the Seller and the affected Suppliers.
12.4.5.2 Except as specifically set forth in this Clause 12.4, this
Clause 12.4 will not be deemed to impose on the Seller any
obligations not expressly set forth elsewhere in this
Agreement.
12.4.5.3 All reports, recommendations, data and other documents
furnished by the Seller to the Buyer pursuant to this Clause
12.4 will be deemed to be delivered under this Agreement and
will be subject to the terms, covenants and conditions set
forth in this Clause 12 and in Clause 22.5.
12.5 EXCLUSIVITY OF WARRANTIES
THIS CLAUSE 12 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE
EXCLUSIVE WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE
OBLIGATIONS OF THE SELLER, AND THE EXCLUSIVE REMEDIES
AVAILABLE TO THE BUYER, WHETHER UNDER THIS AGREEMENT OR
OTHERWISE, ARISING FROM ANY DEFECT OR NONCONFORMITY OF ANY
KIND IN ANY AIRCRAFT, COMPONENT, EQUIPMENT, ACCESSORY, PART OR
SERVICE DELIVERED UNDER THIS AGREEMENT.
THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ALL OTHER
WARRANTIES, OBLIGATIONS, GUARANTEES AND LIABILITIES OF THE
SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES OF THE BUYER
AGAINST THE SELLER, WHETHER EXPRESS OR IMPLIED BY CONTRACT,
TORT, OR STATUTORY LAW OR OTHERWISE, WITH RESPECT TO ANY
NONCONFORMITY OR DEFECT OF ANY KIND IN ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY, PART OR SERVICE DELIVERED
UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO:
(1) ANY IMPLIED WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR ANY GENERAL
OR PARTICULAR PURPOSE;
(2) ANY IMPLIED OR EXPRESS WARRANTY ARISING FROM COURSE OF PERFORMANCE,
COURSE OF DEALING OR USAGE OF TRADE;
(3) ANY RIGHT, CLAIM OR REMEDY FOR BREACH OF CONTRACT RELATING TO OR A
RISING OUT OF THIS CLAUSE 12;
(4) ANY RIGHT, CLAIM OR REMEDY FOR TORT, UNDER ANY THEORY OF LIABILITY,
HOWEVER ALLEGED, INCLUDING, BUT NOT LIMITED TO, ACTIONS AND/OR CLAIMS
FOR NEGLIGENCE, GROSS NEGLIGENCE, INTENTIONAL ACTS, WILLFUL DISREGARD,
IMPLIED WARRANTY, PRODUCT LIABILITY, STRICT LIABILITY OR FAILURE TO
WARN;
(5) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER THE UNIFORM COMMERCIAL CODE OR
ANY OTHER STATE OR FEDERAL STATUTE;
(6) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER ANY REGULATIONS OR STANDARDS
IMPOSED BY ANY INTERNATIONAL, NATIONAL, STATE OR LOCAL STATUTE OR
AGENCY;
(7) ANY RIGHT, CLAIM OR REMEDY TO RECOVER OR BE COMPENSATED FOR:
(a) LOSS OF USE OR REPLACEMENT OF ANY AIRCRAFT, COMPONENT, EQUIPMENT,
ACCESSORY OR PART PROVIDED UNDER THIS AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT, COMPONENT, EQUIPMENT,
ACCESSORY OR PART PROVIDED UNDER THIS AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE WARRANTIES AND SERVICE LIFE POLICY PROVIDED BY THIS
AGREEMENT WILL NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY A
WRITTEN INSTRUMENT SIGNED BY THE SELLER AND THE BUYER. IN THE
EVENT THAT ANY PROVISION OF THIS CLAUSE 12 SHOULD FOR ANY
REASON BE HELD UNLAWFUL, OR OTHERWISE UNENFORCEABLE, THE
REMAINDER OF THIS CLAUSE 12 WILL REMAIN IN FULL FORCE AND
EFFECT.
12.6 DUPLICATE REMEDIES
The remedies provided to the Buyer under this Clause 12 as to
any defect in respect of the Aircraft or any part thereof are
mutually exclusive and not cumulative. The Buyer will be
entitled to the remedy that provides the maximum benefit to
it, as the Buyer may elect, pursuant to the terms and
conditions of this Clause 12 for any such particular defect
for which remedies are provided under this Clause 12;
provided, however, that the Buyer will not be entitled to
elect a remedy under one part of this Clause 12 that
constitutes a duplication of any remedy elected by it under
any other part hereof for the same defect. The Buyer's rights
and remedies herein for the nonperformance of any obligations
or liabilities of the Seller arising under these warranties
will be in monetary damages limited to the amount the Buyer
expends in procuring a correction or replacement for any
covered part subject to a defect or nonperformance covered by
this Clause 12, and the Buyer will not have any right to
require specific performance by the Seller.
Nothing contained in the foregoing Clause 12.5 will be
interpreted to deprive the Buyer of its right to enforce the
rights and remedies set forth in this Clause 12.
UNQUOTE
In consideration of the assignment and subrogation by the
Seller under this Clause 12 in favor of the Buyer in respect
of the Seller's rights against and obligations to the
Manufacturer under the provisions quoted above, the Buyer
hereby accepts such assignment and subrogation and agrees to
be bound by all of the terms, conditions and limitations
therein contained, specifically including, without limitation,
the Exclusivity of Warranties and General Limitations of
Liability provisions and Duplicate Remedies provisions.
THIS CLAUSE 12 (INCLUDING ITS SUBPROVISIONS) SETS FORTH THE
EXCLUSIVE WARRANTIES, EXCLUSIVE LIABILITIES AND EXCLUSIVE
OBLIGATIONS OF THE SELLER, AND THE EXCLUSIVE REMEDIES
AVAILABLE TO THE BUYER, WHETHER UNDER THIS AGREEMENT OR
OTHERWISE, ARISING FROM ANY DEFECT OR NONCONFORMITY OF ANY
KIND IN ANY AIRCRAFT, COMPONENT, EQUIPMENT, ACCESSORY, PART OR
SERVICE DELIVERED UNDER THIS AGREEMENT.
THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ALL OTHER
WARRANTIES, OBLIGATIONS, GUARANTEES AND LIABILITIES OF THE
SELLER AND ALL OTHER RIGHTS, CLAIMS AND REMEDIES OF THE BUYER
AGAINST THE SELLER, WHETHER EXPRESS OR IMPLIED BY CONTRACT,
TORT, OR STATUTORY LAW OR OTHERWISE, WITH RESPECT TO ANY
NONCONFORMITY OR DEFECT OF ANY KIND IN ANY AIRCRAFT,
COMPONENT, EQUIPMENT, ACCESSORY, PART OR SERVICE DELIVERED
UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO:
(1) ANY IMPLIED WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR ANY GENERAL
OR PARTICULAR PURPOSE;
(2) ANY IMPLIED OR EXPRESS WARRANTY ARISING FROM COURSE OF PERFORMANCE,
COURSE OF DEALING OR USAGE OF TRADE;
(3) ANY RIGHT, CLAIM OR REMEDY FOR BREACH OF CONTRACT RELATING TO OR
ARISING OUT OF THIS CLAUSE 12;
(4) ANY RIGHT, CLAIM OR REMEDY FOR TORT, UNDER ANY THEORY OF LIABILITY,
HOWEVER ALLEGED, INCLUDING, BUT NOT LIMITED TO, ACTIONS AND/OR CLAIMS
FOR NEGLIGENCE, GROSS NEGLIGENCE, INTENTIONAL ACTS, WILLFUL DISREGARD,
IMPLIED WARRANTY, PRODUCT LIABILITY, STRICT LIABILITY OR FAILURE TO
WARN;
(5) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER THE UNIFORM COMMERCIAL CODE OR
ANY OTHER STATE OR FEDERAL STATUTE;
(6) ANY RIGHT, CLAIM OR REMEDY ARISING UNDER ANY REGULATIONS OR STANDARDS
IMPOSED BY ANY INTERNATIONAL, NATIONAL, STATE OR LOCAL STATUTE OR
AGENCY;
(7) ANY RIGHT, CLAIM OR REMEDY TO RECOVER OR BE COMPENSATED FOR:
(a) LOSS OF USE OR REPLACEMENT OF ANY AIRCRAFT,COMPONENT,EQUIPMENT,
ACCESSORY OR PART PROVIDED UNDER THIS AGREEMENT;
(b) LOSS OF, OR DAMAGE OF ANY KIND TO, ANY AIRCRAFT, COMPONENT,
EQUIPMENT, ACCESSORY OR PART PROVIDED UNDER THIS AGREEMENT;
(c) LOSS OF PROFITS AND/OR REVENUES;
(d) ANY OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGE.
THE WARRANTIES AND SERVICE LIFE POLICY PROVIDED BY THIS
AGREEMENT WILL NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY A
WRITTEN INSTRUMENT SIGNED BY THE SELLER AND THE BUYER. IN THE
EVENT THAT ANY PROVISION OF THIS CLAUSE 12 SHOULD FOR ANY
REASON BE HELD UNLAWFUL, OR OTHERWISE UNENFORCEABLE, THE
REMAINDER OF THIS CLAUSE 12 WILL REMAIN IN FULL FORCE AND
EFFECT.
The remedies provided to the Buyer under this Clause 12 as to
any defect in respect of the Aircraft or any part thereof are
mutually exclusive and not cumulative. The Buyer will be
entitled to the remedy that provides the maximum benefit to
it, as the Buyer may elect, pursuant to the terms and
conditions of this Clause 12 for any such particular defect
for which remedies are provided under this Clause 12;
provided, however, that the Buyer will not be entitled to
elect a remedy under one part of this Clause 12 that
constitutes a duplication of any remedy elected by it under
any other part hereof for the same defect. The Buyer's rights
and remedies herein for the nonperformance of any obligations
or liabilities of the Seller arising under these warranties
will be in monetary damages limited to the amount the Buyer
expends in procuring a correction or replacement for any
covered part subject to a defect or nonperformance covered by
this Clause 12, and the Buyer will not have any right to
require specific performance by the Seller.
Nothing contained in the foregoing Clause 12.6 will be
interpreted to deprive the Buyer of its right to enforce the
rights and remedies set forth in this Clause 12.
12.7 NEGOTIATED AGREEMENT
The Buyer specifically acknowledges that
(i) this Agreement, and in particular this Clause 12, has
been the subject of discussion and negotiation and is
fully understood by the Buyer;
(ii) the price of the Aircraft and the other mutual
agreements of the Buyer set forth in this Agreement
were arrived at in consideration of, inter alia, the
provisions of this Clause 12, specifically including
the Exclusivity of Warranties set forth in Clause
12.5.
13 - PATENT AND COPYRIGHT INDEMNITY
------------------------------
The Seller represents and warrants that the Manufacturer has
provided to the Seller the following indemnity against patent
and copyright infringements with respect to the Aircraft,
subject to the terms, conditions, limitations and restrictions
(including, but not limited to, the Exclusivity of Warranties
and Duplicate Remedies provisions) as hereinafter set out, and
that the same are in full force and effect and have not been
amended. The Seller hereby assigns to the Buyer, and the Buyer
hereby accepts, all of the Seller's rights and obligations as
the "Buyer" under the said indemnity against patent and
copyright infringements, and the Seller subrogates the Buyer
to all such rights and obligations in respect of the Aircraft.
The Seller hereby warrants to the Buyer that (i) it has all
requisite authority to make the foregoing assignment and to
effect the foregoing subrogation in favor of the Buyer, (ii)
such assignment and subrogation are effective to confer on the
Buyer all of the foregoing rights and obligations of the
Seller, and (iii) the Seller will not enter into any amendment
of the provisions so assigned without the prior written
consent of the Buyer.
It is understood that, in the provisions below between the
words QUOTE and UNQUOTE, capitalized terms have the meanings
assigned thereto in this Agreement, except that (i) the term
"Seller," which means the Manufacturer as between the
Manufacturer and the Seller, also means the Manufacturer in
this Agreement, and (ii) the term "Buyer," which means the
Seller as between the Manufacturer and the Seller, means the
Buyer in this Agreement.
QUOTE
13.1 Indemnity
13.1.1 Subject to the provisions of Clause 13.2.3, the Seller will
indemnify the Buyer and its officers, directors, agents and
employees from and against any damages, costs and expenses
including legal costs (excluding damages, costs, expenses,
loss of profits and other liabilities in respect of or
resulting from loss of use of the Aircraft) resulting from a
claim that the Airframe or any part or software installed
therein at Delivery infringes
(i) any British, French, German, Spanish or U.S. patent;
and
(ii) any patent issued under the laws of any other country
in which the Buyer may lawfully operate the Aircraft,
provided that from the time of design of such
Airframe or any part or software installed therein at
Delivery and until infringement claims are resolved,
the country of the patent and the flag country of the
Aircraft are both parties to
(1) the Chicago Convention on International Civil
Aviation of December 7, 1944 and are each fully
entitled to all benefits of Article 27 thereof,
or,
(2) the International Convention for the Protection
of Industrial Property of March 20, 1883 (the
"Paris Convention"); and
(iii) in respect of computer software installed on the
Aircraft, any copyright, provided that the Seller's
obligation to indemnify will be limited to
infringements in countries which, at the time of
infringement, are members of The Berne Union and
recognize computer software as a "work" under the
Berne Convention.
13.1.2 Clause 13.1.1 will not apply to
(i) Buyer Furnished Equipment;
(ii) the Propulsion Systems;
(iii) parts supplied pursuant to a Supplier Product Support
Agreement; or
(iv) software not created by the Seller.
13.1.3 In the event that the Buyer, due to circumstances contemplated
in Clause 13.1.1 is prevented from using the Aircraft (whether
by a valid judgment of a court of competent jurisdiction or by
a settlement arrived at among the claimant, the Seller and the
Buyer), the Seller will at its expense either
(i) procure for the Buyer the right to use the affected
Airframe, part or software free of charge; or
(ii) replace the infringing part or software as soon as
possible with a noninfringing substitute.
13.2 Administration of Patent and Copyright Indemnity Claims
13.2.1 If the Buyer receives a written claim or a suit is threatened
or begun against the Buyer for infringement of a patent or
copyright referred to in Clause 13.1, the Buyer will
(i) forthwith notify the Seller, giving particulars
thereof;
(ii) furnish to the Seller all data, papers and records
within the Buyer's control or possession relating to
such patent or claim;
(iii) refrain from admitting any liability or making any
payment, or assuming any expenses, damages, costs or
royalties,or otherwise acting in a manner prejudicial
to the defense or denial of the suit or claim, it
being agreed that nothing in this Clause 13.2.1(iii)
will prevent the Buyer from paying the sums that may
be required to obtain the release of the Aircraft,
provided that paymentis accompanied by a denial of
liability and is made without prejudice;
(iv) fully cooperate with, and render * assistance to, the
Seller as may be pertinent to the defense or denial
of the suit or claim;
(v) * mitigate damages and/or to reduce the amount of
royalties that may be payable, and to minimize costs
and expenses.
13.2.2 The Seller will be entitled either in its own name or on
behalf of the Buyer to conduct negotiations with the party or
parties alleging infringement and may assume and conduct the
defense or settlement of any suit or claim in the manner that,
in the Seller's opinion, it deems proper.
13.2.3 The Seller's liability hereunder will be conditional on the
strict and timely compliance by the Buyer with the terms of
this Clause and is in lieu of any other liability to the
Buyer, whether express or implied, which the Seller might
incur at law as a result of any infringement or claim of
infringement of any patent or copyright.
UNQUOTE
In consideration of the assignment and subrogation by the
Seller under this Clause 13 in favor of the Buyer in respect
of the Seller's rights against and obligations to the
Manufacturer under the provisions quoted above, the Buyer
hereby accepts such assignment and subrogation and agrees to
be bound by all of the terms, conditions and limitations
therein contained (specifically including, without limitation,
the waiver, release and renunciation provision).
THE INDEMNITY PROVIDED IN THIS CLAUSE 13 AND THE OBLIGATIONS
AND LIABILITIES OF THE SELLER UNDER THIS CLAUSE 13 ARE
EXCLUSIVE AND IN SUBSTITUTION FOR, AND THE BUYER HEREBY
WAIVES, RELEASES AND RENOUNCES ALL OTHER INDEMNITIES,
WARRANTIES, OBLIGATIONS, GUARANTEES AND LIABILITIES ON THE
PART OF THE SELLER AND RIGHTS, CLAIMS AND REMEDIES OF THE
BUYER AGAINST THE SELLER, EXPRESS OR IMPLIED, ARISING BY LAW
OR OTHERWISE (INCLUDING WITHOUT LIMITATION ANY OBLIGATION,
LIABILITY, RIGHT, CLAIM OR REMEDY ARISING FROM OR WITH RESPECT
TO LOSS OF USE OR REVENUE OR CONSEQUENTIAL DAMAGES), WITH
RESPECT TO ANY ACTUAL OR ALLEGED PATENT INFRINGEMENT OR THE
LIKE BY ANY AIRFRAME, PART OR SOFTWARE INSTALLED THEREIN AT
DELIVERY, OR THE USE OR SALE THEREOF, PROVIDED THAT, IN THE
EVENT THAT ANY OF THE AFORESAID PROVISIONS SHOULD FOR ANY
REASON BE HELD UNLAWFUL OR OTHERWISE INEFFECTIVE, THE
REMAINDER OF THIS CLAUSE WILL REMAIN IN FULL FORCE AND EFFECT.
THIS INDEMNITY AGAINST PATENT AND COPYRIGHT INFRINGEMENTS WILL
NOT BE EXTENDED, ALTERED OR VARIED EXCEPT BY A WRITTEN
INSTRUMENT SIGNED BY THE SELLER AND THE BUYER.
14 - TECHNICAL DATA AND DOCUMENTATION
14.1 General
This Clause covers the terms and conditions for the supply of
Technical Data and Documentation. The Technical Data and
Documentation will be supplied in the English language using
aeronautical terminology in common use.
14.2 Scope
Range, form, type, format, ATA/non-ATA compliance, revision
and quantity of the Technical Data and Documentation are
covered in Exhibit F hereto.
14.3 Delivery
The Technical Data and Documentation and corresponding
revisions to be supplied by the Seller will be sent to one
address only as advised by the Buyer.
Technical Data and Documentation and their revisions will be
delivered Free Carrier (FCA) Toulouse, France and/or Free
Carrier (FCA) Hamburg, Germany, as determined by the Seller.
The delivery schedule of the Technical Data and Documentation
will be phased as mutually agreed to correspond with Aircraft
deliveries. The Buyer agrees to provide forty (40) days'
notice when requesting a change to the delivery schedule.
Subject to the Seller's performance of its obligations
pursuant to Clause 7.3.5, the Buyer will coordinate and
satisfy local Aviation Authorities needs for the Technical
Data and Documentation.
Technical Data and Documentation will correspond to the
Specification as defined six (6) months before delivery of
each Aircraft. If the full Specification will not be
introduced into a scheduled revision of the Technical Data and
Documentation before delivery of any Aircraft, temporary
revisions for outstanding Specification items will be issued.
Such temporary revisions will remain in effect until
incorporation of the full Specification into the Technical
Data and Documentation for such Aircraft. Full incorporation
will be effected by no later than eight (8) months after
delivery of such Aircraft. The Seller will supply a list of
the differences between the Specification and the Technical
Data and Documentation at delivery of each Aircraft.
14.4 Revision Service
14.4.1 General
Unless otherwise specifically stated, revision service will be
offered free of charge * . Mandatory changes will be
incorporated into the Technical Data and Documentation at no
charge for as long as * Aircraft is in service with the Buyer.
14.4.2 Service Bulletins (SB)
On the Buyer's request, Service Bulletin information will be
incorporated into the Technical Data and Documentation for the
Aircraft after formal notification by the Buyer of its
intention to accomplish a Service Bulletin. The Buyer will
make this request within * after the Seller issues a Service
Bulletin. For Technical Data and Documentation relating to
maintenance, the split effectivity for the corresponding
Service Bulletin will remain in such Technical Data and
Documentation until the Buyer notifies the Seller that it has
accomplished the Service Bulletin on all applicable Aircraft.
For Technical Data and Documentation relating to flight
operations, only the pre- or post-Service Bulletin status will
be shown in the Technical Data and Documentation. This clause
will remain in effect so long as the Buyer has revision
service.
This Clause applies only to the following Technical Data and Documentation: *
14.4.3 Customer Originated Changes
14.4.3.1 Customer Originated Changes (COC) data may be incorporated
into the following customized Technical Data and
Documentation:
- Aircraft Maintenance Manual
- Illustrated Parts Catalog
- Trouble Shooting Manual
- Wiring Manual (Schematics, Wirings, Lists)
COC data will be established by the Buyer according to the
"Guidelines for Customer Originated Changes" issued by the
Seller.
The COC data will be labeled "COC" to show that they are Buyer
originated. The Seller will endeavor to incorporate COC data
into the customized Technical Data and Documentation within
two (2) revisions following the receipt of complete and
accurate data for processing.
COC data will be incorporated by the Seller in all affected
customized Technical Data and Documentation, unless the Buyer
specifies in writing into which Technical Data and
Documentation the COC data will be incorporated. The
customized Technical Data and Documentation into which the COC
data are incorporated will only show the Aircraft
configuration that reflects the COC data and not the
configuration before incorporation of the COC data.
14.4.3.2 The Buyer will ensure that any such COC data have received
prior agreement from its local Aviation Authorities.
14.4.3.3 The Buyer hereby acknowledges and accepts that the
incorporation of any COC into the Technical Data and
Documentation issued by the Seller will be entirely at the
Buyer's risk. Accordingly, the Seller will be under no
liability whatsoever in respect of either the contents of any
COC, including any omissions or inaccuracies therein, or the
effect that the incorporation of such COC may have on the
Technical Data and Documentation.
The Seller will not be required to check any COC data
submitted for incorporation as aforesaid.
Further, the Buyer acknowledges full liability for the
effects, including all related costs, that any COC may have on
all subsequent Service Bulletins and modifications.
14.4.3.4 In the event that the Seller is required under any judgment or
settlement to indemnify any third party for injury, loss or
damage incurred directly or indirectly as a result of
incorporation of any COC into the Technical Data and
Documentation issued by the Seller, the Buyer agrees to
reimburse the Seller for all payments or settlements made in
respect of such injury, loss or damage including any expenses
(including reasonable legal fees) incurred by the Seller in
defending such claims, *.
The Seller's liability will in no event be affected by any
communication, whether written or oral, that the Seller may
make to the Buyer with respect to such documentation.
14.4.3.5 The Seller's costs with respect to the incorporation of any
COC will be invoiced to the Buyer under conditions specified
in ASCO's Customer Services Catalog in effect at the time of
the Buyer's request for incorporation.
14.5 Supplier Equipment
Information relating to Supplier equipment that is installed
on the Aircraft by the Seller will be included free of charge
in the basic issue of the Technical Data and Documentation to
the extent necessary for the understanding of the systems
concerned.
The Buyer will supply or cause to be supplied to the Seller
the data related to Buyer Furnished Equipment and to any other
equipment not covered in the Seller's Standard Furnished
Equipment definition at least * months before the scheduled
delivery of the customized Technical Data and Documentation.
The Buyer will supply these data in English.
The Seller will introduce into the basic issue of the
Technical Data and Documentation the data related to Buyer
Furnished Equipment. Costs for shipping these data will be the
Buyer's responsibility.
14.6 Aircraft Identification Technical Data and Documentation
For the customized Technical Data and Documentation the Buyer
agrees to the allocation of Fleet Serial Numbers (FSNs) in the
form of a block of numbers selected in the range from 001 to
999.
The sequence will be interrupted only if two (2) different
Propulsion Systems or different Aircraft models are selected.
The Buyer will indicate to the Seller the FSNs allocated to
the Aircraft within * days after execution of this Agreement.
The allocation of FSNs to Manufacturer's Serial Numbers (MSNs)
will not constitute any proprietary, insurable or other
interest of the Buyer in any Aircraft before delivery of and
payment for Aircraft as provided in this Agreement.
The affected customized Technical Data and Documentation are:
- Aircraft Maintenance Manual
- Illustrated Parts Catalog
- Trouble Shooting Manual
- Wiring Manual (Schematics, Wirings, Lists)
14.7 Performance Engineer's Programs
Complementary to the standard Operational Manuals, covered in
Exhibit F hereto, the Seller will provide to the Buyer
Performance Engineer's Programs (PEPs) under license
conditions defined in Exhibit F hereto.
14.8 CD-ROM
Certain Technical Data and Documentation are provided on
CD-ROM under license conditions defined in Exhibit F hereto.
The affected Technical Data and Documentation are the
following:
- Trouble Shooting Manual
- Aircraft Maintenance Manual
- Illustrated Parts Catalog
From time to time, the Seller may extend this list to include
other Technical Data and Documentation and related license
conditions specified by the Seller.
14.9 Warranty Disclaimer
The Seller represents that the Technical Data and
Documentation are prepared in accordance with the state of the
art at the date of their conception. Should any of the
Technical Data and Documentation prepared by the Seller
contain error or omission, the sole and exclusive liability of
the Seller will be to take all reasonable and proper steps to,
at its option, correct or replace any such Technical Data and
Documentation. Notwithstanding the above, no warranties of any
kind are given for the Customer Originated Changes addressed
in Clause 14.4.3. The provisions of Clauses 12.5, 12.6 and
12.7 will apply to all Technical Data and Documentation.
14.10 Proprietary Rights
14.10.1 All proprietary rights, including but not limited to patent,
design and copyrights, relating to Technical Data and
Documentation will remain with the Seller. All Technical Data
and Documentation are supplied to the Buyer for the Buyer's
sole use.
These proprietary rights will also apply to any translation
into a language or languages or media that may have been
performed or caused to be performed by the Buyer.
14.10.2 Whenever this Agreement provides for manufacturing by the
Buyer, the consent given by the Seller will not be construed
as express or implicit approval of the manufactured products.
The supply of the Technical Data and Documentation will not be
construed as any further right for the Buyer to design or
manufacture any Aircraft or part thereof or spare part.
15 - FIELD ASSISTANCE
15.1 Seller's Service
The Seller will provide or cause to be provided at no charge
to the Buyer the services described in this Clause 15, at the
Buyer's main base or at other locations to be mutually agreed.
15.1.1 The Seller will provide a Resident Customer Support Manager
starting at or about delivery of the first Aircraft and
continuing for as long *.
15.1.2 The Seller will also provide the services of a team of
Customer Support Representatives acting in an advisory
capacity at the Buyer's main base starting at or about
delivery of the first Aircraft for a total of * man-months.
The actual number of Customer Support Representatives assigned
to the Buyer at any one time will be mutually agreed, but will
not be fewer than one (1) or more than three (3) persons.
15.1.3 The Seller has set up a global technical services network
available for the nonexclusive use of operators of aircraft
manufactured by the Manufacturer. The Buyer will have free
access to this global network at any time in the course of its
operation of the Aircraft. In particular, the Buyer will have
access to the regional Customer Support Representatives
closest to the Buyer's main base after the end of the period
referred to above in Clause 15.1.1, or to cover for the
temporary absence of the Customer Support Representative(s). A
list of the contacts for the global technical services
network, including the regional Customer Support
Representatives, will be provided to the Buyer.
15.2 Customer Support Director
The Seller will provide the services of one (1) Customer
Support Director based in Herndon, Virginia, to liaise between
the Manufacturer and the Buyer on product support matters
after signature of this Agreement for as long as the Buyer
operates at least one (1) Aircraft.
15.3 Buyer's Service
15.3.1 For as long as the Customer Support Representative(s)
specified in Clause 15.1.1 above remain(s) with the Buyer, the
Buyer will furnish without charge secretarial assistance,
suitable office space, office equipment and facilities in or
conveniently near the Buyer's maintenance facilities *.
15.3.2 In accordance with the Buyer's regulations, the Buyer will
provide at no charge to the Seller
(i) airline tickets * confirmed and guaranteed between
the locations mentioned above in Subclause 15.1 and
the international airport nearest Toulouse, France,
that is on the Buyer's network for the Customer
Support Representative(s) mentioned in Clauses 15.1.1
and 15.1.2; and
(ii) when said Customer Support Representative(s) are
assigned away from the locations mentioned above in
Clause 15.1 at the Buyer's request, transportation on
a space-available coach class basis between the said
locations and the place of assignment.
15.3.3 The parties will give each other all necessary reasonable
assistance with general administrative functions specific to
their respective countries and procurement of the documents
necessary to live and work there.
15.4 Representatives' Status
In providing the above technical service, the Seller's
employees, including Customer Support Representative(s) and
the Customer Support Director, are deemed to be acting in an
advisory capacity only and at no time will they be deemed to
be acting, either directly or indirectly, as the Buyer's
employees or agents.
15.5 Temporary Assignment of Customer Support Representative
-------------------------------------------------------
The Buyer agrees that, subject to Clause 15.1.2, the Seller
will have the right to transfer or recall any individual
Customer Support Representative(s) on a temporary or permanent
basis.
16 - TRAINING AND TRAINING AIDS
--------------------------
16.1. General
This Clause covers the terms and conditions for the supply of
training and training aids for the Buyer's personnel to
support the Aircraft operation.
16.2. Scope
16.2.1 The range and quantities of training and training aids to be
provided free of charge under this Agreement are covered in
Appendix A to this Clause 16. The Seller will arrange
availability of such training and training aids in relation to
the delivery of the Aircraft.
16.2.2 The contractual training courses, defined in Appendix A to
this Clause 16, will be provided up to one (1) year after
delivery of the last Aircraft.
16.2.3 In the event that the Buyer should use none or only part of
the training or training aids to be provided pursuant to this
Clause, no compensation or credit of any sort will be
provided.
16.3. Training Organization / Location
16.3.1 The Seller will provide the training at the Airbus Training
Center in Miami, or * at of one of its affiliated training
centers.
16.3.2 In the event of the nonavailability of facilities or
scheduling imperatives making training by the Seller
impractical, the Seller will make arrangements for the
provision to the Buyer of such training support elsewhere, *.
16.3.3 Upon the Buyer's request the Seller may also provide certain
training at one of the Buyer's bases, if and when practicable
for the Seller, under terms and conditions to be mutually
agreed upon. In this event, all additional charges listed in
Clause 16.6.2 will be borne by the Buyer.
16.4 Training Courses
16.4.1 Training courses, as well as the minimum and maximum numbers
of trainees per course provided for the Buyer's personnel, are
defined in the Seller's applicable Training Course Catalog and
will be scheduled as mutually agreed upon during a training
conference (the "Training Conference") to be held at least
twelve (12) months prior to delivery of the first Aircraft.
16.4.2 The following terms will apply when training is performed by
the Seller :
(i) Training courses will be the Seller's standard
courses as described in the Seller's current
Training Course Catalog. The Seller will be
responsible for all training course syllabi,
training aids and training equipment necessary for
the organization of the training courses
(ii) The training curricula and the training equipment
may not be fully customized. However, academic
curricula may be modified to include the most
significant aspects of the Specification (to the
exclusion of Buyer Furnished Equipment) as known at
the latest six (6) months prior to the date of the
first training course planned for the Buyer. The
equipment used for training of flight and
maintenance personnel will not be fully customized;
however, this equipment will be configured in order
to obtain the relevant Aviation Authority's
approval and to support the Seller's teaching
programs.
(iii) Training data and documentation necessary for
training detailed in Appendix A to this Clause 16
will be free-of-charge and will not be revised.
Training data and documentation will be marked "FOR
TRAINING ONLY" and as such will be supplied for the
sole and express purpose of training.
(iv) Upon the request of the Buyer, the Seller will
collect and pack for consolidated shipment to the
Buyer's facility, all training data and
documentation of the Buyer's trainees attending
training at the Airbus Training Center in Miami,
Florida. This training data and documentation will
be delivered Free Carrier (FCA) Miami. It is
understood that title to and risk of loss of the
training data and documentation will pass to the
Buyer upon delivery.
16.4.3 In the event the Buyer decides to cancel or reschedule a
training course, a minimum advance notice of sixty (60)
calendar days will be required. Any later cancellation or
change, when courses cannot be allocated to other customers,
will be deducted from the training allowances defined herein
or will be charged to the Buyer, as applicable.
16.4.4 In fulfillment of its obligation to provide training courses,
when the Seller performs the training courses, the Seller will
deliver to the trainees a certificate of completion at the end
of any such training course. The Seller's certificate does not
represent authority or qualification by any official Aviation
Authorities but may be presented to such officials in order to
obtain relevant formal qualification.
In the event that training is provided by a training provider
selected by the Seller, the Seller will cause such training
provider to deliver a certificate of completion at the end of
any such training course. Such certificate will not represent
authority or qualification by any official Aviation
Authorities but may be presented to such officials in order to
obtain relevant formal qualification.
16.5 Prerequisites
16.5.1 Training will be conducted in English and all training aids
and materials are written in English using common aeronautical
terminology. Trainees must have the prerequisite jet transport
category experience as defined in Appendix B to this Clause
16.
It is clearly understood that the Seller's training courses
are "Transition Training Courses" and not "Ab Initio Training
Courses."
Furthermore, the Buyer will be responsible for the selection
of the trainees and for any liability with respect to the
entry knowledge level of the trainees.
16.5.2 The Buyer will provide the Seller with an attendance list of
the trainees for each course with the validated qualification
of each trainee. The Seller reserves the right to check the
trainees' proficiency and previous professional experience.
The Seller will in no case warrant or otherwise be held liable
for any trainee's performance as a result of any training
services provided.
16.5.3 Upon the Buyer's request, the Seller may be consulted to
direct the above mentioned trainee(s) through a relevant entry
level training program, which will be at the Buyer's charge,
and, if necessary, to coordinate with competent outside
organizations for this purpose. Such consultation will be held
during the Training Conference.
In the event the Seller should determine that a trainee lacks
the required entry level, such trainee will, following
consultation with the Buyer, be withdrawn from the program and
will then be considered to be at the Buyer's disposal.
16.6. Logistics
16.6.1 Trainees
16.6.1.1 When training is done at the Airbus Training Center in Miami,
Florida, the Seller will provide a free-of-charge rental car
for all of the Buyer's trainees at the beginning of the
training course on the basis of one rental car per four
maintenance, operations and cabin attendant trainees and one
rental car per flight crew.
The Seller will provide rental cars from a nationally
recognized vendor of its choosing with unlimited mileage and
buy-back of collision damage waiver (CDW), and the Buyer will
pay for gas, and fines, if any. However, the Buyer will
indemnify and hold the Seller harmless from and against all
liabilities, claims, damages, costs and expenses for any
injury to or death of any of the Buyer's trainees occasioned
during the course of such transportation.
16.6.1.2 When training is done at the Airbus Training Center in
Blagnac, France, or Beijing, China, the Seller will provide
free local transportation by bus for the Buyer's trainees to
and from designated pick up points and the training center.
16.6.1.3 Living expenses for the Buyer's trainees are to be borne by
the Buyer.
16.6.2 Training at External Location
16.6.2.1 Seller's Instructors
In the event that, at the Buyer's request, training is
provided by the Seller's instructors at any location other
than the Seller's training centers, the Buyer will reimburse
the Seller for all the expenses, defined below in Clauses
16.6.2.2, 16.6.2.3, 16.6.2.4 and 16.6.2.5 related to the
assignment of such instructors and their performance of the
duties as aforesaid.
16.6.2.2 Living Expenses for the Seller's Instructors
Such expenses, covering the entire period from day of
secondment to day of return to the Seller's base, will include
but will not be limited to lodging, food and local
transportation to and from the place of lodging and the
training course location. The Buyer will reimburse the Seller
for such expenses on the basis of a per diem rate
corresponding to the current per diem rate used by the Seller
for its personnel.
16.6.2.3 Air Travel
The Buyer will reimburse the Seller for the costs of the
Seller's * the Buyer's designated training site and the
Seller's training center.
16.6.2.4 Instructor's Material
The Buyer will reimburse the Seller for the cost of shipping
the instructor's material needed to conduct such courses.
16.6.2.5 Buyer's Indemnity
The Buyer will be solely liable for any and all cancellation
or delay in the performance of the training outside of the
Seller's training centers associated with the transportation
services described above and will indemnify and hold the
Seller harmless from such delay and any consequences arising
therefrom.
16.6.2.6 Training Equipment Availability
Training equipment necessary for course performance at any
course location other than the Seller's training centers or
the facilities of the training provider selected by the Seller
will be provided by the Buyer in accordance with the Seller's
specifications.
16.7 Flight Operations Training
16.7.1 Flight Crew Training Course
16.7.1.1 The Seller will perform a flight crew transition training
course program for the Buyer's flight crews, each of which
will consist of one captain (1) and one (1) first officer, as
defined in Appendix A to this Clause 16. The training manual
used will be the Seller's Flight Crew Operating Manual.
16.7.1.2 The Buyer will use its delivered Aircraft for any required
Aircraft in-flight training. This training will not exceed one
(1) session of one and a half (1.5) hours per pilot. When
Aircraft in-flight crew training is performed in Blagnac,
France, the Seller will provide free-of-charge line
maintenance, including servicing, preflight checks and
changing of minor components, subject to conditions agreed in
the present Agreement.
16.7.1.3 The Buyer will provide mutually agreed spare parts as required
to support said Aircraft in-flight training and will provide
insurance in line with Clause 16.12.
16.7.1.4 In all cases, the Buyer will bear all expenses such as fuel,
oil and landing fees.
16.7.2. Flight Crew Line Initial Operating Experience
16.7.2.1 In order to assist the Buyer with initial operating experience
after delivery of the first Aircraft, the Seller will provide
to the Buyer pilot instructor(s) as defined in Appendix A to
this Clause 16.
16.7.2.2 The Buyer will reimburse the expenses for each such instructor
in accordance with Clause 16.6.2. Additional pilot instructors
can be provided at the Buyer's expense and upon conditions to
be mutually agreed upon.
16.7.3 Cabin Attendants' Familiarization Course
The Seller will provide cabin attendants' course(s) to the
Buyer's cabin attendants, as defined in Appendix A to this
Clause 16.
The cabin attendants' course, when incorporating the features
of the Aircraft, can be given at the earliest two (2) weeks
before the delivery date of the first Aircraft.
16.7.4 Performance / Operations Course
The Seller will provide performance/operations training for
the Buyer's personnel as defined in Appendix A to this Clause
16.
The available courses are listed in the Seller's applicable
Training Course Catalog.
16.8 Maintenance Training
16.8.1 The Seller will provide maintenance training for the Buyer's
ground personnel as defined in Appendix A to this Clause 16.
The available courses are listed in the Seller's applicable
Training Course Catalog.
16.8.2 On-the-Job Training
Upon the Buyer's request, the Seller may be consulted to
identify competent outside organizations to provide on-the-job
training, which will be at the Buyer's charge.
16.8.3 Line Maintenance Initial Operating Experience Training
In order to assist the Buyer during the entry into service of
the Aircraft, the Seller will provide to the Buyer maintenance
instructor(s) at the Buyer's base as defined in Appendix A to
this Clause 16.
16.8.3.1 This line maintenance initial operating experience training
will cover training in handling and servicing of Aircraft,
flight crew and maintenance coordination, use of paper and/or
electronic documentation, and/or any other activities which
may be deemed necessary after delivery of the first Aircraft.
16.8.3.2 The Seller will pay the expenses for said instructor(s).
Additional maintenance instructors can be provided at the
Buyer's expense.
16.9 Supplier and Engine Manufacturer Training
A copy of the Supplier Training Catalogue, listing the
suppliers that provide training, will be supplied to the Buyer
on request.
16.10 Training Aids and Materials for the Buyer's Training
Organization
16.10.1 The Seller will provide to the Buyer the Airbus Computer Based
Training (CBT) System, training aids and material, as used in
the Seller's training centers, free of charge as defined in
Appendix A to this Clause 16.
The Airbus CBT System, training aids and material supplied to
the Buyer will be similar to those used in the Manufacturer's
training centers for the training provided for the Buyer. The
Seller has no obligation to cause the Manufacturer to revise
the Airbus CBT System.
16.10.2 Delivery
16.10.2.1 The Seller will deliver to the Buyer the Airbus CBT System,
training aids and materials as defined in Appendix A to this
Clause 16, at a date to be mutually agreed during the Training
Conference.
16.10.2.2 Those items supplied to the Buyer pursuant to Clause 16.10.1
above will be delivered FCA Toulouse, Blagnac Airport. Title
to and risk of loss of said items will pass to the Buyer upon
delivery.
16.10.2.3 All costs related to transportation and insurance of said
items from the FCA point to the Buyer's facilities will be at
the Buyer's expense.
16.10.3 Installation
16.10.3.1 Upon the Buyer's request, the Seller may assist the Buyer with
the initial installation of the Airbus CBT System at the
Buyer's facility following notification in writing that the
various components, which are in accordance with
specifications defined in the Airbus CBT Technical Catalog,
are ready for installation and available at the Buyer's
facility.
16.10.3.2 The Buyer will provide any and all the necessary hardware on
which the Airbus CBT System will be installed and Seller will
not be responsible for any incompatibility of such hardware
with the Airbus CBT System.
16.10.3.3 The Airbus CBT System will be installed by the Buyer's
personnel who have completed the Airbus CBT training, and the
Seller will be held harmless from any damage to person and/or
to property caused by or in any way connected with the
handling and/or installation of the Airbus CBT System by the
Buyer's personnel.
16.10.3.4 The Buyer will reimburse the expenses in accordance with
Clause 16.6.2, for the Seller's personnel required at the
Buyer's facility to conduct Airbus CBT Training and/or provide
installation assistance.
16.10.4 License
16.10.4.1 The Seller will grant the Buyer a license to use the Airbus
CBT System, as defined in Appendix C to this Clause 16.
16.10.4.2 Supply of additional sets of courseware supports, as well as
any extension to the license for such courseware, will be
subject to terms and conditions to be mutually agreed.
16.10.5 The Seller will not be responsible and hereby disclaims any
and all liabilities resulting from or in connection with the
use by the Buyer of the training aids and materials at the
Buyer's facilities.
16.11 Proprietary Rights
The Seller's training data and documentation, Airbus CBT
System, training aids and material are proprietary to the
Manufacturer and its suppliers and the Buyer agrees not to
disclose the content of the courseware or any information or
documentation provided by the Seller in relation to training
in whole or in part, to any third party without the prior
written consent of the Seller.
16.12 Indemnification and Insurance
Indemnification provisions additional to those in Clause
16.6.2.5 and insurance requirements are as set forth in Clause
19.
APPENDIX A TO CLAUSE 16
TRAINING ALLOWANCE
1. FLIGHT OPERATIONS TRAINING
1.1 Flight Crew Training
The Seller will provide flight crew training (regular
transition or CCQ as applicable) free of charge for * of the
Buyer's flight crews. *.
1.2 Flight Crew Line Initial Operating Experience
The Seller will provide to the Buyer pilot instructor(s) for
one (1) pilot instructor month to assist with flight-crew
initial operating experience.
The maximum number of pilot instructors present at any one
time will be limited to two (2) pilot instructors.
1.3 Cabin Attendants' Familiarization Course
The Seller will provide to the Buyer cabin attendants'
training free of charge for twenty-four (24) of the Buyer's
cabin attendants.
1.4 Performance/Operations Course(s)
The Seller will provide to the Buyer two hundred (200) trainee
days of performance/operations training free of charge for the
Buyer's personnel.
The above trainee days will be used solely for the
performance/operations training courses as defined in the
Seller's applicable Training Course Catalog.
APPENDIX A TO CLAUSE 16
2. MAINTENANCE TRAINING
2.1 Maintenance Training Courses
The Seller will provide to the Buyer * trainee days of
maintenance training free of charge for the Buyer's personnel.
These trainee days will be used solely for the Maintenance
training courses as defined in the Seller's applicable
Training Course Catalog. The number of Engine Run-up courses
will be limited to one (1) course for three (3) trainees per
Aircraft.
2.2 Line Maintenance Initial Operating Experience Training
The Seller will provide to the Buyer maintenance instructor(s)
at the Buyer's base free of charge for a period of * weeks.
3. TRAINEE DAYS ACCOUNTING
Trainee days are counted as follows:
- For instruction at the Seller's training centers, one (1)
day of instruction for one (1) trainee equals one (1)
trainee day, and the number of trainees at the beginning of
the course will be counted as the number of trainees
considered to have taken the course.
- For instruction outside of the Seller's training centers,
one (1) day of secondment of one (1) Seller instructor
equals the actual number of trainees attending the course
or a minimum of twelve (12) trainee days.
4. TRAINING AIDS AND CBT SYSTEM FOR BUYER'S TRAINING ORGANIZATION
4.1 The Seller will provide the Buyer with the following training
aids:
- * sets of cockpit color paper panel drawings (scale 1/1)
and one (1) reproducible CD ROM
- * set of cockpit color paper panel drawings (scale1/2) and
one (1) reproducible CD ROM
4.2 The Seller will provide to the Buyer one (1) "Airbus CBT
System," defined in Clause 2.1.3 of Appendix C hereto, related
to the Aircraft. The Seller will also provide free of charge
updates to courseware in Clause 4.2 below when developed by
the Manufacturer, for five (5) years after initial delivery of
the courseware.
The Airbus CBT System supplied to the Buyer will consist of
- one (1) Airbus CBT installation/utilization guide
- one (1) set of CD-ROM with run time software related to the
delivered courseware.
For Flight Operations Training
The A320 Family flight crew Airbus CBT courseware will be
delivered with - one (1) set of CD ROM with Airbus CBT
courseware files, including ADOPT/ACOPI tools - one (1) set of
Training Interface for Performance and Weight and Balance
(TIPWB)
For Maintenance Training
The A320 Family maintenance Airbus CBT courseware will be
delivered with - one (1) set of CD ROM with Airbus CBT
courseware files - one (1) set of training documentation
master, whenever applicable - one (1) set of menu listings -
six (6) sets of videodisks, whenever applicable
APPENDIX B TO CLAUSE 16
MINIMUM RECOMMENDED QUALIFICATION
IN RELATION TO TRAINING REQUIREMENTS
(Regular Transition Courses)
The prerequisites listed below are the minimum recommended requirements
specified for Airbus training. If the appropriate regulatory agency or the
specific airline policy of the trainee demand greater or additional
requirements, they will apply as prerequisites.
- CAPTAIN prerequisites
---------------------
. Fluency in English
. 1500 hours minimum flying experience as pilot . 1000 hours
experience on FAR/JAR 25 aircraft
. 200 hours experience as airline, corporate pilot or military
pilot . Must have flown transport type aircraft, as flying
pilot, within the last 12 months.
- FIRST OFFICER prerequisites
---------------------------
. Fluency in English
. 500 hours minimum flying experience as pilot of fixed wing
aircraft . 300 hours experience on FAR/JAR 25 aircraft . 200
hours flying experience as airline pilot or a corporate pilot
or military pilot . Must have flown transport type aircraft,
as flying pilot, within the last 12 months.
For both CAPTAIN and FIRST OFFICER, if one or several of the
above criteria are not met, the trainee must follow
(i) an adapted course (example: if not fluent in English,
an adapted course with a translator), or
(ii) an Entry Level Training ELT) program before entering
the regular or the adapted course.
Such course(s), if required, will be at the Buyer's expense.
- MAINTENANCE PERSONNEL prerequisites
. Fluency in English
. Experience on first or second generation jet transport
category aircraft. Knowledge of digital techniques,
including ARINC 429, for electrics / avionics specialists.
If this criterion is not met the trainee must follow a Basic Digital Course.
APPENDIX C TO CLAUSE 16
LICENSE FOR USE OF AIRBUS COMPUTER BASED TRAINING
1. GRANT
The Seller grants the Buyer the right, pursuant to the terms and
conditions herein, to use the Airbus CBT System for the term (defined
in Clause 4 below) of this license (the "License").
2. DEFINITIONS
2.1 For the purpose of this Appendix C to Clause 16, the following
definitions will apply :
2.1.1 "Airbus CBT Courseware" means the programmed instructions that provide
flight crew and maintenance training.
2.1.2 "Airbus CBT Software" means the system software that permits the use of
the Airbus CBT Courseware.
2.1.3 "Airbus CBT System" means the combination of the Airbus CBT Software
and the Airbus CBT Courseware.
2.1.4 "Student/Instructor Mode" means the mode that allows the user to run
the Airbus CBT Courseware.
2.1.5 "Airbus CBT Training" means the training enabling the Buyer to load and
use the Airbus CBT System.
2.2 For the purpose of clarification, it is hereby stated that all related
hardware required for the operation of the Airbus CBT System is not
part of the Airbus CBT System and will be procured under the sole
responsibility of the Buyer.
3. COPIES
3.1 The Buyer will be permitted to copy the Airbus CBT Software for back-up
and archiving purposes and for loading of the Airbus CBT Software
exclusively on the Buyer's workstations. In such cases, the Buyer will
advise the Seller in writing stating the number and purpose of any
copies made. Any other copying is strictly prohibited.
3.2 The Buyer agrees to reproduce the copyright and other notices as they
appear on or within the original media on any copies that the Buyer
makes of the Airbus CBT Software.
4. TERM
The rights under this License will be granted to the Buyer for as long
as the Buyer operates the aircraft model to which the Airbus CBT
Software and the Airbus CBT courseware apply. When the Buyer stops
operating said Aircraft model, the Buyer will return the Airbus CBT
System and any copies thereof to the Seller, accompanied by a note
certifying that the Buyer has returned all existing copies.
5. PERSONAL ON-SITE LICENSE
5.1 The above described License is personal to the Buyer for use of the
Airbus CBT System within the Buyer's premises only, and is
nontransferable and nonexclusive.
5.2 The Buyer may not (i) distribute or sublicense any portion of the
Airbus CBT System, (ii) modify or prepare derivative works from the
Airbus CBT Software, (iii) publicly display visual output of the Airbus
CBT Software, or (iv) transmit the Airbus CBT Software electronically
by any means.
6. CONDITIONS OF USE
6.1 Use of the Airbus CBT Software
For the student delivery mode, the Buyer will use the Airbus CBT
Software for the exclusive purpose of
(i) including students on the roster for one or several courses
syllabi in order to follow students' progression,
(ii) rearranging course syllabi or creating new ones using
available courseware modules, it being understood that the
Seller disclaims any responsibility regarding any course(s)
that may be modified or rearranged by the Buyer.
6.2 Use of the Airbus CBT Courseware
The Buyer will use the Airbus CBT Courseware for the exclusive purpose
of performing training instructions for its personnel, or for third
party personnel contracted to perform work on the Aircraft on behalf of
the Buyer. Such training will be performed at the Buyer's facility or
at a subcontractor's facility provided it is conducted by the Buyer's
personnel.
7. PROPRIETARY RIGHTS AND NONDISCLOSURE
The Airbus CBT Software and Airbus CBT Courseware, the copyrights and
any and all other author rights, intellectual, commercial or industrial
proprietary rights of whatever nature in the Airbus CBT Software and
Airbus CBT Courseware are and will remain with the Seller or its
suppliers, as the case may be. The Airbus CBT Software and Airbus CBT
Courseware and their contents are designated as confidential. The Buyer
will not take any commercial advantage by copy or presentation to third
parties of the Airbus CBT Software, the documentation, the Airbus CBT
Courseware, and/or any rearrangement, modification or copy thereof.
The Buyer acknowledges the Manufacturer's proprietary rights in the
Airbus CBT System and undertakes not to disclose the Airbus CBT
Software or Airbus CBT Courseware or parts thereof or their contents to
any third party without the prior written consent of the Seller.
Insofar as it is necessary to disclose aspects of the Airbus CBT
Software and Airbus CBT Courseware to the Buyer's personnel, such
disclosure is permitted only for the purpose for which the Airbus CBT
Software and Airbus CBT Courseware are supplied to the Buyer under the
License.
8. LIMITED WARRANTY
8.1 The Seller warrants that the Airbus CBT System is prepared in
accordance with the state of the art at the date of its conception.
Should the Airbus CBT System be found to contain any nonconformity or
defect, the Buyer will notify the Seller promptly thereof and the sole
and exclusive liability of the Seller under this Clause 8.1 of the
Airbus CBT License will be to correct the same at its own expense.
8.2 WAIVER, RELEASE AND RENUNCIATION
THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND REMEDIES
OF THE BUYER SET FORTH IN THIS LICENSE ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES,
ALL OTHER WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND
RIGHTS, CLAIMS AND REMEDIES OF THE BUYER AGAINST THE SELLER, EXPRESS
OR IMPLIED, ARISING BY LAW OR OTHERWISE WITH RESPECT TO ANY
NONCONFORMITY OR DEFECT IN AIRBUS CBT SYSTEM DELIVERED UNDER THIS
LICENSE INCLUDING BUT NOT LIMITED TO:
(A) ANY WARRANTY AGAINST HIDDEN DEFECTS;
(B) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;
(C) ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF
DEALING OR USAGE OF TRADE;
(D) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY, WHETHER CONTRACTUAL
OR IN TORT AND WHETHER OR NOT ARISING FROM THE SELLER'S NEGLIGENCE,
ACTUAL OR IMPUTED; AND
(E) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OR DAMAGE
TO ANY AIRCRAFT, COMPONENT, EQUIPMENT, ACCESSORY OR PART THEREOF.
THE SELLER WILL HAVE NO OBLIGATION OR LIABILITY, HOWSOEVER ARISING, FOR
LOSS OF USE, REVENUE OR PROFIT OR FOR ANY OTHER DIRECT, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY NONCONFORMITY OR DEFECT IN
THE AIRBUS CBT SYSTEM DELIVERED UNDER THIS LICENSE.
Nothing contained in the foregoing Clause 8.2 will be interpreted to
deprive the Buyer of its right to enforce the rights and remedies set
forth in this License.
17 - EQUIPMENT SUPPLIER PRODUCT SUPPORT
----------------------------------
17.1 Equipment Supplier Product Support Agreements
17.1.1 The Seller has obtained Supplier Product Support Agreements
transferable to the Buyer from Suppliers of Seller Furnished
Equipment listed in the Specification.
17.1.2 These agreements are based on the "World Airlines and
Suppliers Guide" and include Supplier commitments contained in
the Supplier Product Support Agreements, which include the
following:
(i) Technical data and manuals required to operate,
maintain, service and overhaul the Supplier items
will (a) be prepared in accordance with the
applicable provisions of ATA Specification 100 and
101 in accordance with Clause 14 of this Agreement,
(b) include revision service, and (c) be published in
the English language. The Seller recommends that
software data, supplied in the form of an appendix to
the Component Maintenance Manual, be provided in
compliance with ATA Specification 102 up to level 3
to protect Supplier's proprietary interests.
(ii) Warranties and guarantees, including Suppliers'
standard warranties, and in the case of Suppliers of
landing gear, service life policies for selected
landing gear structures.
(iii) Training to ensure efficient operation, maintenance
and overhaul of the Suppliers' items for the Buyer's
instructors, shop and line service personnel.
(iv) Spares data in compliance with ATA Specification 200
or 2000, initial provisioning recommendations, spares
and logistics service, including routine and
emergency deliveries.
(v) Technical service to assist the Buyer with
maintenance, overhaul, repair, operation and
inspection of Supplier items as well as required
tooling and spares provisioning.
17.2 Supplier Compliance
The Seller will monitor Supplier compliance with support
commitments defined in the Supplier Product Support Agreements
and will take action together with the Buyer if necessary.
17.3 Supplier Part Repair Stations
17.3.1 The Manufacturer has developed with the Suppliers a
comprehensive network of repair stations in North America for
those Supplier Parts originating from outside this territory.
As a result, most Supplier Parts are repairable in North
America, and corresponding repair stations are listed in the
AOG and Repair Guide, which is issued and regularly updated by
the Manufacturer.
The Seller undertakes that the Supplier Parts that have to be
forwarded for repair outside North America will be sent back
to the Buyer with proper tagging as required by the FAA.
17.3.2 The Seller will support the Buyer in cases where the agreed
repair turn time of an approved repair station is not met by
causing free-of-charge loans or exchanges as specified in the
relevant Supplier Product Support Agreements to be offered to
the Buyer.
18 - BUYER FURNISHED EQUIPMENT
-------------------------
18.1 Administration
18.1.1 Without additional charge and in accordance with the
Specification, the Seller will cause the Manufacturer to
provide for the installation of the BFE, provided that the BFE
is referred to in the Airbus BFE Catalog of Approved Suppliers
by Products valid at the time the BFE is ordered.
The Seller will cause the Manufacturer to advise the Buyer of
the dates by and location to which, in the planned release of
engineering for the Aircraft, the Manufacturer requires a
written detailed engineering definition. This description will
include the description of the dimensions and weight of BFE,
the information related to its certification and information
necessary for the installation and operation thereof. The
Buyer will furnish such detailed description and information
by the dates specified. Thereafter, no information, dimensions
or weights will be revised unless authorized by an SCN.
The Seller will also provide the Buyer in due time with a
schedule of dates and shipping addresses for delivery of BFE
and (when requested by the Seller) additional spare BFE to
permit installation of the BFE in the Aircraft and delivery of
the Aircraft in accordance with the delivery schedule. The
Buyer will provide the BFE by such dates in a serviceable
condition, to allow performance of any assembly, test, or
acceptance process in accordance with the industrial schedule.
The Buyer will also provide, when requested by the
Manufacturer, at Aerospatiale works and/or at DASA works,
adequate field service, including support from BFE suppliers
to act in a technical advisory capacity to the Seller in the
installation, calibration and possible repair of any BFE.
18.1.2 The BFE will be imported into France or into Germany by the
Buyer under a suspensive customs system ("Regime de l'entrepot
industriel pour fabrication coordonnee" or "Zollverschluss")
without application of any French or German tax or customs
duty, and will be Delivered Duty Unpaid (DDU) (as defined in
the April 1990 edition of publication No. 460, published by
the International Chamber of Commerce), to
AEROSPATIALE MATRA S.A.
▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
or
DAIMLER CHRYSLER AEROSPACE AIRBUS GmbH
Division Hamburger Flugzeugbau
Kreetslag 10
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ OF GERMANY
as provided in Clause 18.1.1.
18.1.3 If the Buyer requests the Seller to supply directly certain
items that are considered BFE according to the Specification,
and if such request is notified to the Seller in due time in
order not to affect the delivery date of the Aircraft, the
Seller may agree to order such items subject to the execution
of an SCN reflecting the effect on price, escalation
adjustment, and any other conditions of the Agreement. In such
a case the Seller will be entitled to the payment of a
reasonable handling charge and will bear no liability in
respect of delay and product support commitments for such
items.
18.2 Requirements
The Buyer is responsible for, at its expense, and warrants
that BFE will (i) be manufactured by a qualified supplier,
(ii) meet the requirements of the applicable Specification,
(iii) comply with applicable requirements incorporated by
reference to the Type Certificate and listed in the Type
Certificate Data Sheet, and (iv) be approved by the Aviation
Authorities delivering the Certificate of Airworthiness for
Export and by the Buyer's Aviation Authority for installation
and use on the Aircraft at the time of Delivery of such
Aircraft. The Seller will be entitled to refuse any item of
BFE that is incompatible with the Specification, the
engineering definition mentioned in the second paragraph of
Clause 18.1.1 or the certification requirements.
18.3 Buyer's Obligation and Seller's Remedies
18.3.1 Any delay or failure in
(i) furnishing the BFE in serviceable condition at the
requested delivery date,
(ii) complying with the warranty in Clause 18.2 or in
providing the descriptive information or service
representatives mentioned in Clause 18.1.1, or
(iii) in obtaining any required approval for such equipment
under the above mentioned Aviation Authorities
regulations may delay the performance of any act to
be performed by the Seller, and cause the Final
Contract Price of the Aircraft to be adjusted in
accordance with the updated delivery schedule,
including, in particular, the costs the Seller incurs
that are attributable to the delay or failure
described above, such as storage, taxes, insurance
and costs of out-of sequence installation.
18.3.2 In addition to the consequences outlined in Clause 18.3.1, in
the event of a delay or failure described in Clause 18.3.1,
(i) the Seller may, after consultation with the Buyer,
select, purchase and install equipment similar to the
BFE at issue, in which event the Final Contract Price
of the affected Aircraft will also be increased by
the purchase price of such equipment, plus reasonable
costs and expenses incurred by the Seller for
handling charges, transportation, insurance,
packaging and, if required and not already provided
for in the price of the Aircraft, for adjustment and
calibration; or
(ii) if the BFE is delayed more than thirty (30) days
beyond, or unapproved within thirty (30) days of the
date pursuant to Clause 18.1.1, then the Seller may
deliver or the Buyer may elect to have the Aircraft
delivered without the installation of such equipment,
notwithstanding the terms of Clause 7.2 insofar as it
may otherwise have applied,whereon the Seller will be
relieved of all obligations to install such equipment
18.4 Title and Risk of Loss
Title to and risk of loss of BFE will at all times remain with
the Buyer, except that risk of loss (limited to cost of
replacement of said BFE and excluding in particular loss of
use) will be with the Seller for as long as the BFE is in the
care, custody and control of the Seller.
19- Indemnities and Insurance
19.1 Seller's Indemnities
The Seller will be solely liable for and will indemnify and
will hold the Buyer, its directors, officers, agents or
employees, harmless against all losses, liabilities, costs,
expenses and damages, including court costs and reasonable
attorneys' fees ("Losses"), arising from
(i) claims for injuries to, or deaths of, the Seller's,
Manufacturer's or any Associated Contractor's
respective directors, officers, agents or employees,
or loss or damage to property of the Seller,
Manufacturer or any Associated Contractor or their
respective employees when such losses occur during or
are incidental to (a) the Buyer's exercise of its
inspection rights under Clause 7, (b) the Technical
Acceptance Process described in Clause 8, (c) the
provision of Field Assistance pursuant to Clause 15
or (d) the provision of training pursuant to Clause
16, and
(ii) claims for injuries to or deaths of third parties, or
loss of property of third parties, occurring during,
or incidental to (a) the Buyer's exercise of its
inspection rights pursuant to Clause 7 or (b) the
Technical Acceptance Process described in Clause 8,
provided that such Losses do not result from the gross
negligence or willful misconduct of the Buyer, its directors,
officers, agents or employees.
19.2 Buyer's Indemnities
The Buyer will be solely liable for and will indemnify and
will hold the Seller, the Manufacturer, each of the Associated
Contractors and their respective subcontractors, Affiliates of
the Seller, the Seller's representatives, and the respective
assignees, directors, officers, agents, and employees of each
of the foregoing, harmless against all Losses arising from
(i) claims for injuries to or deaths of the Buyer's
directors, officers, agents or employees, or loss or
damage to property of the Buyer or its employees,
when such losses occur during or are incidental to
(a) the Buyer's exercise of its inspection rights
under Clause 7; (b) the Technical Acceptance Process
described in Clause 8, (c) the provision of Field
Assistance pursuant to Clause 15, or (d) the
provision of training pursuant to Clause 16; and
(ii) claims for injuries to or deaths of third parties, or
loss of property of third parties, where such losses
occur during or incidental to (a) the provision of
Field Services under Clause 15 or (b) arise out of
the provision of training pursuant to Clause 16,
provided that such Losses do not result from the gross
negligence or willful misconduct of the Seller.
19.3 Notice and Defense of Claims
(i) If any claim is made or suit is brought against a
party or entity entitled to indemnification under
this Clause 19 (the "Indemnitee") for damages for
which liability has been assumed by the other party
under this Clause 19, (the "Indemnitor"), the
Indemnitee will promptly give notice to the
Indemnitor and the Indemnitor (unless otherwise
requested by the Indemnitee) will assume and conduct
the defense, or settlement, of such suit, as the
Indemnitor will deem prudent. Notice of the claim or
suit will be accompanied by all information pertinent
to the matter as is reasonably available to the
Indemnitee and will be followed by such cooperation
by the Indemnitee as the Indemnitor or its counsel
may reasonably request at the expense of the
Indemnitor.
(ii) In the event that the Indemnitor fails or refuses to
assume the defense of any claim or lawsuit notified
to it under this Clause 19, the Indemnitee will have
the right to proceed with the defense or settlement
of the claim or lawsuit as it deems prudent and will
have a claim over against the Indemnitor for any
judgments, settlements, costs or expenses, including
reasonable attorneys' fees. Further, in such event,
the Indemnitor will be deemed to have waived any
objection or defense to the Indemnitee's claim based
on the reasonableness of any settlement.
19.4 Insurance
(i) Each party will maintain adequate insurance to
support its undertakings under this Clause 19, and
will bear any deductible amounts set forth in the
applicable policies. With respect to Clause 19.1(i)
and 19.2(i), the Buyer and the Seller will each
provide a certificate of insurance, if requested by
the other party, prepared by an insurance broker
licensed and skilled in the field of aviation
insurance, in English and containing such specifics
as the requesting party may reasonably demand.
(ii) With respect to the Buyer's undertaking in Clause
19.2(ii), the Buyer will
(a) cause the Seller, its Affiliates, the
Manufacturer, each of the Associated
Contractors and their respective
subcontractors, Seller's representatives,
and the respective assignees, officers,
directors, agents and employees of the
foregoing, to be named as additional
insureds under the Buyer's liability
policies;
(b) obtain and cause the carriers of its hull
all risks and hull war risk policies to
waive all rights of subrogation against the
Seller, its Affiliates, the Manufacturer,
each of the Associated Contractors, Seller's
representatives and the respective
assignees, officers, directors, agents and
employees of the foregoing; and
(c) not less than seven (7) Working Days before
the commencement of training to be provided
under Clause 16, furnish to the Seller
certificates of insurance, in English, from
a licensed insurance broker skilled in the
field of aviation insurance, certifying that
(1) the requirements of the foregoing Clauses 19.4 (ii)(a) and (b) have
been met;
(2) the limits and insurance periods of each applicable policy;
(3) the applicable policies are primary and noncontributory to any other
insurance maintained by the Seller;
(4) the applicable policies contain a cross-liability provision; and
(5) the insurance coverage will not become ineffective, canceled, or
materially decreased or changed except on seven(7)Working Days' notice
to the Seller.
20 - ASSIGNMENTS AND TRANSFERS
-------------------------
20.1 Successors and Assigns
Subject to the provisions of this Clause 20, this Agreement
will inure to the benefit of and be binding upon the
successors and assigns of the parties hereto. This Agreement
may not be assigned in whole or in part by either party
without the prior written consent of the other, except as
specifically provided herein.
20.2 Assignments and Transfers by the Seller
----------------------------------------
20.2.1 Seller Designations
The Seller may at any time, with notice to the Buyer,
designate the Manufacturer, ASCO, any Associated Contractor or
any Affiliate of the Seller, or any particular facilities or
particular personnel of each, to be responsible for, and/or to
provide the goods and services to be provided or performed
under this Agreement. No such designation will release the
Seller from any of its obligations hereunder.
20.2.2 Seller Assignments
The Seller may at any time assign any of its rights to receive
money, and any of its duties to effect sale and delivery of
the Aircraft, or any of its responsibilities, duties or
obligations to perform any other obligations hereunder, to the
Manufacturer, any of the Associated Contractors, ASCO or any
Affiliate of the Seller, the Manufacturer, the Associated
Contractors or ASCO. No such assignment will release the
Seller from any of its obligations hereunder.
20.2.3 Transfer of Rights and Obligations upon Reorganization
If at any time until the date upon which all the obligations
and liabilities of the Seller under this Agreement have been
discharged, the legal structure, the membership or the
business of the Seller is reorganized or the legal form of the
Seller is changed and as a consequence thereof the Seller
wishes the Buyer to accept the substitution of the Seller by
another entity within the restructured Airbus group (or the
Seller in its new legal form) ("Newco") as contemplated below,
the Seller will promptly notify the Buyer of its wish.
In such event, the Seller may request the Buyer to enter into
a novation agreement and/or other agreement having the same
effect whereby the Seller's rights and obligations under this
Agreement are novated or transferred in favor of Newco. Upon
receipt of such request, the Buyer will enter into a novation
agreement and/or other appropriate agreement, provided that
the Buyer's rights and obligations under this Agreement are
not materially adversely affected by such novation and/or
other agreement. *.
Until any such novation agreement/other appropriate
documentation has come into effect, this Agreement will remain
in full force and effect, and each party will act diligently
and in good faith to implement the novation agreement and/or
other appropriate documentation as soon as practicable after
Newco has come into existence.
20.3 Assignments by the Buyer
20.3.1 Assignment on Sale, Merger or Consolidation
*
20.3.2 Assignment to Affiliate
The Buyer may assign its rights and obligations hereunder with
respect to one or more Aircraft to any of its Affiliates,
provided that (i) such Affiliate has executed an assumption
agreement, in form and substance satisfactory to the Seller,
agreeing to assume all of the Buyer's obligations under this
Agreement, and (ii) the Buyer remains obligated to the Seller
under this Agreement as though the assignment had not taken
place.
20.3.3 Assignments for Financing Purposes
(i) At or following delivery, the Buyer will be entitled
to assign its rights and obligations under Clauses
12, 13 and 17 hereof to any provider of financing
with respect to one or more Aircraft, to the extent
that such Clauses apply to the Aircraft that are
being financed, as security for the Buyer's
obligations with respect to such financing, provided
that such assignment does not, in the Seller's
reasonable judgment, adversely affect the Seller's
rights hereunder.
(ii) The Buyer will be entitled to assign its rights to
take title to one or more Aircraft at delivery, and
its rights and obligations under Clauses 12, 13, 17
and this Clause 20, to the extent such Clauses apply
to the Aircraft being delivered, to a trust or other
special purpose entity, in each case in connection
with the financing of one or more Aircraft, provided
that the assignment does not, in the Seller's
reasonable judgment, adversely affect the Seller's
rights hereunder.
20.3.4 Post-Delivery Sale or Lease
The Seller agrees that, upon the post-delivery sale or lease
of an Aircraft (including a sale or lease for financing
purposes) all of the Buyer's rights and obligations remaining
at the time of such sale or lease under Clauses 12, 13, and 17
of this Agreement and this Clause 20.3.4 with respect to the
affected Aircraft will inure to the benefit of the transferee
upon delivery to the Seller of notice of such sale or lease
and written agreement by the transferee, in form and substance
satisfactory to the Seller, to be bound by the terms thereof.
20.3.5 Seller's Cooperation with Financing
The Seller agrees to cooperate with the Buyer's financing of
the Aircraft by providing written consents, legal opinions and
such other documents as the Buyer or its lender may reasonably
request.
21 - TERMINATION FOR CERTAIN EVENTS
------------------------------
21.1 Buyer Termination Events
21.1.1 Each of the following will constitute a "Buyer Termination
Event" under this Agreement and immediately upon the
occurrence of a Buyer Termination Event, the Buyer will notify
the Seller of such occurrence in writing as provided in Clause
22.2 hereof, provided, however, that any failure by the Buyer
to notify the Seller will not prejudice the Seller's rights
hereunder:
(1) The Buyer or any of its Affiliates commences any
case, proceeding or other action with respect to the
Buyer or any of its Affiliates in any jurisdiction
relating to bankruptcy, insolvency, reorganization,
relief from creditors, arrangement, winding-up,
liquidation, dissolution or other relief with respect
to its debts (a "Buyer Insolvency Proceeding") or any
other party commences a Buyer Insolvency Proceeding
against the Buyer or any of its Affiliates and such
Insolvency Proceeding remains unstayed, undismissed
or undischarged for * days.
(2) An action is commenced seeking the appointment of a
receiver, trustee, custodian or other similar
official for the Buyer or any of its Affiliates for
all or substantially all of its assets, and such
action remains unstayed, undismissed or undischarged
for * days, or the Buyer or any of its Affiliates
makes a general assignment for the benefit of its
creditors.
(3) An action is commenced against the Buyer or any of
its Affiliates seeking issuance of a warrant of
attachment, execution, distraint or similar process
against all or any substantial part of its assets,
and such action remains unstayed, undismissed or
undischarged for * days.
(4) The Buyer or any of its Affiliates becomes insolvent
or fails generally to pay its debts as they become
due.
(5) The Board of Directors (or other governing corporate
body) of the Buyer directs or authorizes the Buyer's
management to commence negotiations with one or more
of its significant creditors with a view to general
readjustment or rescheduling of all or any material
part of its indebtedness which it would otherwise not
be able to pay as it falls due.
(6) The Buyer or any permitted assignee or transferee of
the Buyer fails to make any payment of a deposit,
Predelivery Payment, Final Contract Price or amount
due for Initial Provisioning when such payment comes
due.
(7) The Buyer or any of its Affiliates fails to make any
other payment when due under this Agreement or under
any other agreement between the Buyer or any of its
Affiliates and the Seller or any of its Affiliates
within * of receiving notice from Seller that such
payment is due.
(8) The Buyer defaults in its obligations under Clause
9.2 of this Agreement to take delivery of an Aircraft
which is Ready for Delivery and has been duly
tendered to the Buyer, which failure will be deemed
to be a rejection of the Aircraft without warrant.
(9) The Buyer defaults in the observance or performance
of any material covenant, undertaking or obligation
contained in this Agreement or any other material
agreement between the Buyer and the Seller and, if
such breach or default is capable of being cured,
such breach or default is not cured within any
specified cure period, or if no cure period is
specified, within * of receiving notice of such
breach or default.
21.1.2 In the event of any Buyer Termination Event the Seller will
have the right to elect one or more of the remedies in this
Clause 21.1.2. The Seller's remedies will specifically
include, without limitation, the right by written notice to
the Buyer, effective immediately, to (i) suspend its
performance under this Agreement and under any other
agreements between the Buyer and the Seller; (ii) terminate
this Agreement or any other agreement between the Buyer and
the Seller with respect to any or all Aircraft or aircraft,
equipment, services, data and other items undelivered or
unfurnished on the effective date of such termination; (iii)
reschedule the Delivery Date of any and all Aircraft remaining
to be delivered under this Agreement as of the date of the
occurrence of the Buyer Termination Event; (iv) reschedule
delivery of any and all aircraft remaining to be delivered
under any other agreement between the Buyer and the Seller as
of the date of the occurrence of the Buyer Termination Event;
and (v) in the event of termination of this Agreement, retain,
as damages for breach and not as a penalty, an amount equal to
(a) all Predelivery Payments previously received by the Seller
from the Buyer under this Agreement in respect of the Aircraft
terminated, (b) any other advance payments to the Seller made
theretofore under this Agreement or any other agreement
between the Buyer or any of its Affiliates and the Seller or
any of its Affiliates in respect of the Aircraft terminated,
and (c) any other amounts agreed to between the Buyer and the
Seller pursuant to this Agreement in respect of the Aircraft
terminated.
The Seller will have the right to elect one or more of the
foregoing remedies, and exercise of any one or more of such
remedies will not be deemed a waiver of any other remedy or
remedies provided herein or under applicable law.
21.2 Seller Termination Events
*.
21.3 Insecurity Events
21.3.1 Each of the following will constitute an "Insecurity Event"
and any remedies therefor provided in this Clause 21.3 will be
without prejudice to and will be in addition to, and not as a
substitute for any rights the Seller may have, at law or as
set forth in Clause 21.1 hereof, to terminate this Agreement:
(1) With respect to any credit or lease financing
facility or similar agreement, including but not
limited to any agreement signed subsequent to the
date hereof, for the lease or use of aircraft, either
(i) the commitment to lend, finance or lease, as the
case may be, is terminated (other than by the Buyer
or for reasons unrelated to the financial condition
or performance of the Buyer) or (ii) a financial
covenant thereunder is breached and such breach is
not waived or cured within *.
(2) The Buyer or any of its Affiliates fails to make any
payments as they become due to or for the benefit of
the Propulsion Systems manufacturer or an A320 family
operating lessor, under their respective agreements,
provided that the applicable cure period, if any, has
expired.
(3) The Buyer is involuntarily removed from active
membership and participation in any airline
clearinghouse (or any substitute or replacement
arrangement), or the Buyer is placed on a cash basis
by such clearinghouse (or such substitute or
replacement arrangement), in either case as a result
of the Buyer's failure to meet financial tests
mandated by such clearinghouse or to make payments to
or for the benefit of such clearinghouse when due.
(4) The Buyer defaults in (i) the payment of principal or
interest under one or more agreements for borrowed
money and/or (ii) the payment of rent or indemnities
under one or more lease agreements that, in the
aggregate, have a principal amount of $* (US
dollars-- *) or more (determined in the case of
borrowed money by the amount outstanding and, in the
case of a lease, by the present value of the
remaining rent payable thereunder discounted at *
when the same becomes due, if such nonpayment either
allows or results in the acceleration of such
indebtedness.
(5) At the end of each calendar month, the Buyer fails to
have a minimum of $* (US dollars-- *) of liquidity
resources represented by the aggregate of the
following: (a) any unencumbered cash balances, (b)
any trade receivables created by the Buyer in the
ordinary course of business that have been
outstanding for fewer than * days and that are
current, due and payable within * days and against
which no provisions have been made by the Buyer and
(c) any unused lines of credit available to the Buyer
from reputable financial institutions on which, under
the terms of the applicable credit agreement, the
Buyer is then eligible to draw.
21.3.2 Within * of the occurrence of an Insecurity Event, the Buyer
will notify the Seller of such occurrence in writing and by
courier or facsimile (in either case in accordance with the
notice provisions of this Agreement), provided however, that
any failure by the Buyer to notify the Seller will not
prejudice the Seller's rights hereunder.
21.3.3 Upon receipt of notice from the Buyer under Clause 21.3.2, or
on becoming aware by any other means of the occurrence of an
Insecurity Event, the Seller will be entitled to request
assurance from the Buyer of the Buyer's ability to duly
perform each of the Buyer's obligations under this Agreement
and any other agreement between the Buyer and the Seller (or
any of their respective Affiliates) ("Assurance"). Such
Assurance will be evidenced in writing and will consist of
either (i) evidence that the event or circumstance giving rise
to the Insecurity Event has been cured or eliminated or (ii)
assurance substantially identical to that constituting
"adequate assurance of due performance" within the meaning of
Article 2-609 of the Uniform Commercial Code as in effect in
the state of New York on the date of this Agreement.
21.3.4 In the event that the Buyer does not provide Assurance to the
Seller within * of the request therefor by the Seller, the
Seller will have the right, at its option, to exercise any one
or more of the remedies in this Clause 21.3.4. The Seller's
remedies will specifically include, without limitation, the
right by written notice to the Buyer, effective immediately,
to (i) suspend its performance under this Agreement and under
any other agreements between the Buyer and the Seller; (ii)
terminate this Agreement or any other agreement between the
Buyer and the Seller with respect to any or all Aircraft or
aircraft, equipment, services, data and other items
undelivered or unfurnished on the effective date of such
termination; (iii) reschedule the Delivery Date of any and all
Aircraft remaining to be delivered under this Agreement as of
the date of the occurrence of the Insecurity Event; (iv)
reschedule delivery of any and all aircraft remaining to be
delivered under any other agreement between the Buyer and the
Seller as of the date of the occurrence of the Insecurity
Event; and (v) in the event of termination of this Agreement
retain, as damages for breach and not as a penalty, an amount
equal to (a) all Predelivery Payments previously received by
the Seller from the Buyer under this Agreement in respect of
the Aircraft terminated, (b) any other advance payments to the
Seller made theretofore under this Agreement or any other
agreement between the Buyer or any of its Affiliates and the
Seller of any of its Affiliates in respect of the Aircraft
terminated, and (c) any other amounts agreed to between the
Buyer and the Seller pursuant to this Agreement in respect of
the Aircraft terminated.
The Seller will have the right to elect one or more of the
foregoing remedies, and exercise of any one or more of such
remedies will not be deemed a waiver of any other remedy or
remedies provided herein or under applicable law.
21.4 Information Covenants
The Buyer hereby covenants and agrees that, from the date of
this Agreement until no further Aircraft are to be delivered
hereunder, the Buyer will furnish or cause to be furnished to
the Seller the following:
(a) Annual Financial Statements. As soon as available
and in any event within 120 days after the close of
each fiscal year of the Buyer, (i) a copy of the SEC
Form 10-K filed by the Buyer with the Securities and
Exchange Commission or any successor thereto (the
"SEC") for such fiscal year, or, if no such Form 10-K
was filed by the Buyer for such a fiscal year, the
consolidated balance sheet of the Buyer and its
Subsidiaries, as at the end of such fiscal year and
the related consolidated statements of operations, of
common stockholders' equity (deficit) and of cash
flows for such fiscal year, setting forth comparative
consolidated figures as of the end of and for the
preceding fiscal year, and examined by (x) any "Big
Five" accounting firm or (y) any other firm of
independent public accountants of recognized standing
selected by the Buyer and reasonably acceptable to
the Seller, whose opinion will not be qualified as to
the scope of audit or as to the status of the Buyer
as a going concern, and (ii) a certificate of such
accounting firm stating that its audit of the
business of the Buyer was conducted in accordance
with generally accepted auditing standards.
(b) Quarterly Financial Statements. As soon as available
and in any event within 45 days after the close of
each of the first three quarterly accounting periods
in each fiscal year of the Buyer, a copy of the SEC
Form 10-Q filed by the Buyer with the SEC for such
quarterly period, or, if no such Form 10-Q was filed
by the Buyer with respect to any such quarterly
period, the consolidated balance sheet of the Buyer
and its Subsidiaries, as at the end of such quarterly
period and the related consolidated statements of
operations for such quarterly period and for the
elapsed portion of the fiscal year ended with the
last day of such quarterly period and in each case
setting forth comparative consolidated figures as of
the end of and for the related periods in the prior
fiscal year, all of which will be certified by an
Authorized Officer of the Buyer, subject to changes
resulting from audit and normal year-end audit
adjustments.
(c) Other Information. Promptly upon transmission
thereof, copies of any filings and registrations
with, and reports to, the SEC by the Buyer or any of
its Subsidiaries, and, with reasonable promptness,
such other information or documents (financial or
otherwise) as the Seller may reasonably request from
time to time.
For the purposes of this Subclause 21.4, (x) an "Authorized
Officer" of the Buyer will mean the Chief Executive Officer,
the Chief Financial Officer or any Vice President and above
who reports directly or indirectly to the Chief Financial
Officer and (y) "Subsidiaries" will mean, as of any date of
determination, those companies owned by the Buyer whose
financial results the Buyer is required to include in its
statements of consolidated operations and consolidated balance
sheets.
21.5 Nothing contained in this Clause 21 will be deemed to waive or
limit the rights and remedies available to the parties under
the Uniform Commercial Code as in effect in the State of New
York as of the effective date of this Agreement (the "UCC"),
including, but not limited to, those rights and remedies
described in Article 2, Section 609 of the UCC.
21.6 NOTWITHSTANDING ANY PROVISIONS OF THIS CLAUSE 21, OR OF ANY
OTHER PROVISION OF THIS AGREEMENT, INCLUDING CLAUSE 11.5,
NEITHER THE BUYER NOR THE SELLER WILL BE LIABLE FOR
INCIDENTAL, SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES ARISING
OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE RIGHTS AND
OBLIGATIONS ARISING HEREUNDER.
22 - MISCELLANEOUS PROVISIONS
------------------------
22.1 Data Retrieval
On the Seller's reasonable request, the Buyer will provide the
Seller with all the necessary data, as customarily compiled by
the Buyer and pertaining to the operation of the Aircraft, to
assist the Seller in making an efficient and coordinated
survey of all reliability, maintenance, operational and cost
data with a view to improving the safety, availability and
operational costs of the Aircraft.
22.2 Notices
All notices and requests required or authorized hereunder will
be given in writing either by personal delivery to a
responsible officer of the party to whom the same is given or
by commercial courier, certified air mail (return receipt
requested) or facsimile at the addresses and numbers set forth
below. The date on which any such notice or request is so
personally delivered, or if such notice or request is given by
commercial courier, certified air mail or facsimile, the date
on which sent, will be deemed to be the effective date of such
notice or request.
The Seller will be addressed at:
▇, ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention: Director - Contracts
Telephone: ▇▇ ▇▇ ▇▇ ▇▇ ▇▇ ▇▇
Telecopy: 33 05 61 30 40 11
The Buyer will be addressed at:
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Vice President Administration and General Counsel
Telephone: ▇▇▇-▇▇▇-▇▇▇▇, Ext. 1004
Fax: ▇▇▇-▇▇▇-▇▇▇▇
From time to time, the party receiving the notice or request
may designate another address or another person.
22.3 Waiver
The failure of either party to enforce at any time any of the
provisions of this Agreement, to exercise any right herein
provided or to require at any time performance by the other
party of any of the provisions hereof will in no way be
construed to be a present or future waiver of such provisions
nor in any way to affect the validity of this Agreement or any
part hereof or the right of the other party thereafter to
enforce each and every such provision. The express waiver by
either party of any provision, condition or requirement of
this Agreement will not constitute a waiver of any future
obligation to comply with such provision, condition or
requirement.
22.4 INTERPRETATION AND LAW
THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED AND THE
PERFORMANCE THEREOF WILL BE DETERMINED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ITS
CONFLICTS OF LAWS PROVISIONS THAT WOULD RESULT IN THE
APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.
Each of the Seller and the Buyer (i) hereby irrevocably
submits itself to the nonexclusive jurisdiction of the courts
of the state of New York, New York County, of the United
States District Court for the Southern District of New York,
for the purposes of any suit, action or other proceeding
arising out of this Agreement, the subject matter hereof or
any of the transactions contemplated hereby brought by any
party or parties hereto, and (ii) hereby waives, and agrees
not to assert, by way of motion, as a defense or otherwise, in
any such suit, action or proceeding, to the extent permitted
by applicable law, any defense based on sovereign or other
immunity or that the suit , action or proceeding which is
referred to in clause (i) above is brought in an inconvenient
forum, that the venue of such suit, action or proceeding is
improper, or that this Agreement or the subject matter hereof
or any of the transactions contemplated hereby may not be
enforced in or by these courts. The Seller hereby designates
and appoints CT Corporation, New York City offices, to receive
for and on its behalf service of process in any proceeding
with respect to any matter as to which it submits to
jurisdiction as set forth above, it being agreed that service
on CT Corporation will constitute valid service on the Seller.
The Buyer hereby generally consents to service of process by
registered mail, return receipt requested, at its address for
notice under this Agreement.
THE PARTIES HEREBY ALSO AGREE THAT THE UNITED NATIONS
CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS
WILL NOT APPLY TO THIS TRANSACTION.
22.5 Confidentiality and Disclosure
22.5.1 Subject to any legal or governmental requirements of
disclosure, the parties (which for this purpose will include
their employees and agents) will maintain the terms and
conditions of this Agreement and any reports or other data,
including Technical Data and Documentation (the "Confidential
Material"), furnished hereunder strictly confidential.
22.5.2 Without limiting the generality of the foregoing, the Buyer *
limit the disclosure of the Confidential Material to the
extent legally permissible in any filing required to be made
by the Buyer with any governmental agency and will make such
applications as will be reasonably necessary to implement the
foregoing. With respect to any public disclosure or filing,
the Buyer agrees to submit to the Seller a copy of the
document proposed to be filed or disclosed. The Buyer will
give the Seller a reasonable period of time in which to review
the said document, and will consult with the Seller before the
making of any such public disclosure or filing.
22.5.3 The Buyer may disclose the Technical Data and Documentation to
parties providing maintenance of the Aircraft, provided that
the Buyer causes any such maintenance provider to execute a
confidentiality agreement containing, at a minimum, terms
substantially the same in scope and effect as the terms in
Exhibit I hereto.
22.5.4 Notwithstanding any other provision of this Clause 22.5, the
Buyer will be permitted to disclose the Confidential Material
without the Seller's consent
(i) to its professional advisors,
(ii) *
(iii) *
(iv) where necessary, and o nly to the extent necessary,
for the Buyer to prosecute, or defend itself in, a
legal action to which the Buyer may become a party,
and
(v) to the extent that such Confidential Information:
(a) becomes generally available to the public other
than as a result of a violation of this
Agreement;
(b) was available to the Buyer on a
non-confidential basis prior to its disclosure
hereunder;
(c) becomes available on a non-confidential basis
from a third party source under circumstances
reasonably believed by the Buyer not to violate
this or any other confidentiality agreement.
22.5.5 The provisions of this Clause 22.5 will survive any
termination of this Agreement.
22.6 Severability
In the event that any provision of this Agreement should for
any reason be held to be without effect, the remainder of this
Agreement will remain in full force and effect. To the extent
permitted by applicable law, each party hereto hereby waives
any provision of law which renders any provision of this
Agreement prohibited or unenforceable in any respect.
22.7 Alterations to Contract
This Agreement, including its Exhibits and Appendixes,
contains the entire agreement between the parties with respect
to the subject matter hereof and thereof and supersedes any
previous understanding, commitments or representations
whatsoever, whether oral or written. This Agreement will not
be varied except by an instrument in writing of even date
herewith or subsequent hereto executed by both parties or by
their fully authorized representatives.
22.8 Inconsistencies
In the event of any inconsistency between the terms of this
Agreement and the terms contained in either (i) the
Specification annexed in Exhibit A-1 or Exhibit A-2 hereto, or
(ii) any other Exhibit hereto, in each such case the terms of
this Agreement will prevail over the terms of the
Specification or any other Exhibit hereto. For the purpose of
this Clause 22.8, the term Agreement will not include the
Specification or any other Exhibit hereto.
22.9 Language
All correspondence, documents and any other written matters in
connection with this Agreement will be in English.
22.10 Headings
All headings in this Agreement are for convenience of
reference only and do not constitute a part of this Agreement.
22.11 Counterparts
This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and
delivered will be an original, but all such counterparts will
together constitute but one and the same instrument.
23. CERTAIN REPRESENTATIONS OF THE PARTIES
23.1. Buyer's Representations
The Buyer represents and warrants to the Seller:
(i) the Buyer is a corporation organized and existing in
good standing under the laws of the State of Colorado
and has the corporate power and authority to enter
into and perform its obligations under this
Agreement;
(ii) neither the execution and delivery by the Buyer of
this Agreement, nor the consummation of any of the
transactions by the Buyer contemplated thereby, nor
the performance by the Buyer of the obligations
hereunder, constitutes a breach of any agreement to
which the Buyer is a party or by which its assets are
bound;
(iii) this Agreement has been duly authorized, executed and
delivered by the Buyer and constitutes the legal,
valid and binding obligation of the Buyer enforceable
against the Buyer in accordance with its terms.
23.2 Seller's Representations
The Seller represents and warrants to the Buyer:
(i) the Seller is a societe a responsabilite limitee
organized and existing in good standing under the
laws of the Republic of France and has the corporate
power and authority to enter into and perform its
obligations under the Agreement;
(ii) neither the execution and delivery by the Seller of
this Agreement, nor the consummation of any of the
transactions by the Seller contemplated thereby, nor
the performance by the Seller of the obligations
hereunder, constitutes a breach of any agreement to
which the Seller is a party or by which its assets
are bound;
(iii) this Agreement has been duly authorized, executed and
delivered by the Seller and constitutes the legal,
valid and binding obligation of the Seller
enforceable against the Seller in accordance with its
terms.
IN WITNESS WHEREOF, these presents were entered into as of the day and year
first above written.
AVSA, S.A.R.L.
By: ________________________
Title:
FRONTIER AIRLINES, INC.
By: __________________________
Title:
EXHIBIT A-1
The A318 Standard Specification is contained in a separate folder.
APPENDIX 1 TO EXHIBIT A-1
SCNs for the A318 Aircraft.
Reference Subject Price
US$ 1/99
CN25.11.208 Second Observer $*
CN31.14.103 Overhead Panel toggle switch re-orientation $*
CN32.40.103 Brake Cooling Fans $*
CN34.41.200 Weather radar with predictive windshear $*
(forward looking)
CN35.11.201 Crew Oxygen Cylinder115 cubic feet $*
GN25.33.051 Install G5 full-width galley $*
GN25.43.450 Delete Lavatory LF $*
GN25.43.200 Install Lavatory LD $*
GN25.43.220 Install Lavatory LE $*
$*
EXHIBIT A-2
The A319 Standard Specification is contained in a separate folder.
APPENDIX 1 TO EXHIBIT A-2
SCNs for the A319 Aircraft.
Reference Subject Price
US$ 1/99
CN25.11.208 Second Observer $*
CN31.14.103 Overhead Panel toggle switch re-orientation $*
CN32.40.103 Brake Cooling Fans $*
CN34.41.200 Weather radar with predictive windshear $*
(forward looking)
CN35.11.201 Crew Oxygen Cylinder115 cubic feet $*
GN25.33.051 Install G5 full-width galley $*
GN25.43.450 Delete Lavatory LF $*
GN25.43.220 Install Lavatory LE $*
$*
EXHIBIT B
AVSA SCN No.
SPECIFICATION CHANGE NOTICE Issue
(SCN) Dated
Page No.
TITLE
DESCRIPTION
EFFECT ON WEIGHT
----------------
Manufacturer's Weight Empty Change:
Operational Weight Empty Change:
Allowable Payload Change:
REMARKS/REFERENCES
Response to RFC
SPECIFICATION CHANGED BY THIS SCN
THIS SCN REQUIRES PRIOR OR CONCURRENT ACCEPTANCE OF THE FOLLOWING SCN(s)
------------------------------------------------------------------------
PRICE PER AIRCRAFT
US DOLLARS:
AT DELIVERY CONDITIONS:
This change will be effective on Aircraft No. and subsequent
provided approval is received by .
BUYER APPROVAL SELLER APPROVAL
-------------- ---------------
By: By:
Title: (Authorized Finance Department Officer) Date:
By:
Title: (Authorized maintenance or flight operations officer)
Date:
AVSA SCN No.
SPECIFICATION CHANGE NOTICE Issue
(SCN) Dated
Page No.
SCOPE OF CHANGE (FOR INFORMATION ONLY)
EXHIBIT C
SELLER SERVICE LIFE POLICY
1. The Items of primary and auxiliary structure described hereunder
are covered by the Service Life Policy described in Subclause 12.2
of the Agreement.
2. WINGS - CENTER AND OUTER WING BOX
---------------------------------
2.1 Spars
2.2 Ribs Inside the Wing Box
2.3 Upper and Lower Panels of the Wing Box
--------------------------------------
2.4 Fittings
2.4.1 Attachment fittings for the flap structure
2.4.2 Attachment fittings for the engine pylons
2.4.3 Attachment fittings for the main landing gear
2.4.4 Attachment fittings for the center wing box
2.5 Auxiliary Support Structure
2.5.1 For the slats:
-------------
2.5.1.1 Ribs supporting the track rollers on wing box structure
2.5.1.2 Ribs supporting the actuators on wing box structure
2.5.2 For the ailerons:
----------------
2.5.2.1 Hinge brackets and ribs on wing box rear spar or shroud box
2.5.2.2 Actuator fittings on wing box rear spar or shroud box
2.5.3 For airbrakes, spoilers, lift dumpers:
-------------------------------------
2.5.3.1 Hinge brackets and ribs on wing box rear spar or shroud box
2.5.3.2 Actuator fittings on wing box rear spar or shroud box
3. FUSELAGE
3.1 Fuselage Structure
3.1.1 Fore and aft bulkheads
3.1.2 Pressurized floors and bulkheads surrounding the main and nose
gear wheel well and center wing box
3.1.3 Skins with doublers, stringers and frames from the forward
pressure bulkheads to the frame supporting the rear attachment of
horizontal stabilizer
3.1.4 Window and windscreen attachment structure but excluding
transparencies
3.1.5 Passenger and cargo doors internal structure
3.1.6 ▇▇▇▇▇ excluding scuff plates and upper beams surrounding passenger
and cargo door apertures
3.1.7 Cockpit floor structure and passenger cabin floor beams excluding
floor panels and seat rails
3.1.8 Keel beam structure
3.2 Fittings
3.2.1 Landing gear attachment fittings
3.2.2 Support structure and attachment fittings for the vertical and
horizontal stabilizers
4. STABILIZERS
4.1 Horizontal Stabilizer Main Structural Box
4.1.1 Spars
4.1.2 Ribs
4.1.3 Upper and lower skins and stringers
4.1.4 Attachment fittings to fuselage and trim screw actuator
4.1.5 Elevator support structure
4.1.5.1 Hinge bracket
4.1.5.2 Servocontrol attachment brackets
4.2 Vertical Stabilizer Main Structural Box
4.2.1 Spars
4.2.2 Ribs
4.2.3 Skins and stringers
4.2.4 Attachment fittings to fuselage
4.2.5 Rudder support structure
4.2.5.1 Hinge brackets
4.2.5.2 Servocontrol attachment brackets
5. Bearing and roller assemblies, bearing surfaces, bushings, bolts,
rivets, access and inspection doors, including manhole doors,
latching mechanisms, all system components, commercial interior
parts, insulation and related installation and connecting devices
are excluded from this Seller Service Life Policy.
EXHIBIT D
CERTIFICATE OF ACCEPTANCE
for A318 Aircraft
In accordance with the terms of that certain A318/A319 Purchase Agreement dated
as of March 10, 2000, between Frontier Airlines, Inc., ("FRONTIER") and AVSA,
S.A.R.L. ("AVSA") (the "Purchase Agreement"), the Technical Acceptance Process
relating to the Airbus A318 aircraft, Manufacturer's Serial Number: _____, U.S.
Registration Number: ______ with two (2) ▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇ 6124 series
propulsion systems installed thereon, serial nos. ______ (position #1) and
_______ (position #2) (the "A318 Aircraft"), has taken place at _______________
on the ____ day of _____________, ____.
In view of said Technical Acceptance Process having been carried out with
satisfactory results, FRONTIER hereby approves the A318 Aircraft as being in
conformity with the provisions of the Purchase Agreement.
Said acceptance does not affect the rights of FRONTIER under the warranties
relating to the A318 Aircraft set forth in the Purchase Agreement.
FRONTIER specifically recognizes that it has waived any right it may have at law
or otherwise to revoke this acceptance of the A318 Aircraft.
RECEIPT AND ACCEPTANCE OF THE ABOVE-DESCRIBED A318
AIRCRAFT ACKNOWLEDGED
FRONTIER AIRLINES, INC.
By: __________________________
Its: __________________________
CERTIFICATE OF ACCEPTANCE
for A319 Aircraft
In accordance with the terms of that certain A318/A319 Purchase Agreement dated
as of March 10, 2000, between Frontier Airlines, Inc., ("FRONTIER") and AVSA,
S.A.R.L. ("AVSA") (the "Purchase Agreement"), the Technical Acceptance Process
relating to the Airbus A319 aircraft, Manufacturer's Serial Number: _____, U.S.
Registration Number: ______ with two (2) CFM International 56-5B5\P series
propulsion systems installed thereon, serial nos. ______ (position #1) and
_______ (position #2) (the "A319 Aircraft"), has taken place at _______________
on the ____ day of _____________, ____.
In view of said Technical Acceptance Process having been carried out with
satisfactory results, FRONTIER hereby approves the A319 Aircraft as being in
conformity with the provisions of the Purchase Agreement.
Said acceptance does not affect the rights of FRONTIER under the warranties
relating to the A319 Aircraft set forth in the Purchase Agreement.
FRONTIER specifically recognizes that it has waived any right it may have at law
or otherwise to revoke this acceptance of the A319 Aircraft.
ECEIPT AND ACCEPTANCE OF THE ABOVE-DESCRIBED A319
AIRCRAFT ACKNOWLEDGED
FRONTIER AIRLINES, INC.
By: __________________________
Its: __________________________
EXHIBIT E
▇▇▇▇ OF SALE
for A318 Aircraft
Know all persons by these presents that AVSA, S.A.R.L. ("AVSA"), a societe a
responsabilite limitee organized and existing under the laws of the Republic of
France,whose address is 2 rond-point ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, is
the owner of the title to the following airframe (the "Airframe"), the attached
engines as specified (the "Engines") and all appliances, components, parts,
instruments, accessories, furnishings, modules and other equipment of any
nature, excluding Buyer Furnished Equipment, incorporated therein, installed
thereon or attached thereto on the date hereof (the "Parts"):
MANUFACTURER OF AIRFRAME: MANUFACTURER OF ENGINES:
------------------------ -----------------------
AIRBUS INDUSTRIE ▇.▇.▇. ▇▇▇▇▇ & ▇▇▇▇▇▇▇
MODEL: A318-100 MODEL: PW 6124
----- -----
MANUFACTURER'S SERIAL NUMBERS:
-------------- --------------
SERIAL NUMBER: [ ] LH : [ ]
-------------
RH : [ ]
REGISTRATION NO: [ ]
---------------
The Airframe, Engines and Parts are hereafter together referred to as the
aircraft (the "Aircraft").
AVSA does this ___ day of _______________ sell, transfer and deliver all of its
above described rights, title and interest to the Aircraft to the following
company and its successors and assigns forever, said Aircraft to be the property
thereof:
-----------------------------------
(the "Buyer")
AVSA hereby warrants to the Buyer, its successors and assigns that AVSA has on
the date hereof good and lawful right to sell, deliver and transfer title to the
Aircraft to the Buyer and that there is hereby conveyed to the Buyer on the date
hereof good, legal and valid title to the Aircraft, free and clear of all liens,
claims, charges, encumbrances and rights of others and that the Seller will
warrant and defend such title forever against all claims and demands whatsoever.
THIS ▇▇▇▇ OF SALE WILL BE GOVERNED BY AND CONSTRUED AND THE PERFORMANCE THEREOF
WILL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ITS CONFLICTS OF LAWS PROVISIONS THAT WOULD RESULT IN THE
APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed by
its duly authorized representative this ______ day of [ ]
AVSA, S.A.R.L.
By:
Title:
Signature:
▇▇▇▇ OF SALE
for A319 Aircraft
Know all persons by these presents that AVSA, S.A.R.L. ("AVSA"), a societe a
responsabilite limitee organized and existing under the laws of the Republic of
France,whose address is 2 rond-point ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, is
the owner of the title to the following airframe (the "Airframe"), the attached
engines as specified (the "Engines") and all appliances, components, parts,
instruments, accessories, furnishings, modules and other equipment of any
nature, excluding Buyer Furnished Equipment, incorporated therein, installed
thereon or attached thereto on the date hereof (the "Parts"):
MANUFACTURER OF AIRFRAME: MANUFACTURER OF ENGINES:
------------------------ -----------------------
AIRBUS INDUSTRIE G.I.E. CFM INTERNATIONAL
MODEL: A319-100 MODEL: CFM 56-5B5\P
----- -----
MANUFACTURER'S SERIAL NUMBERS:
-------------- --------------
SERIAL NUMBER: [ ] LH : [ ]
-------------
RH : [ ]
REGISTRATION NO: [ ]
---------------
The Airframe, Engines and Parts are hereafter together referred to as the
aircraft (the "Aircraft").
AVSA does this ___ day of _______________ sell, transfer and deliver all of its
above described rights, title and interest to the Aircraft to the following
company and its successors and assigns forever, said Aircraft to be the property
thereof:
-----------------------------------
(the "Buyer")
AVSA hereby warrants to the Buyer, its successors and assigns that AVSA has on
the date hereof good and lawful right to sell, deliver and transfer title to the
Aircraft to the Buyer and that there is hereby conveyed to the Buyer on the date
hereof good, legal and valid title to the Aircraft, free and clear of all liens,
claims, charges, encumbrances and rights of others and that the Seller will
warrant and defend such title forever against all claims and demands whatsoever.
THIS ▇▇▇▇ OF SALE WILL BE GOVERNED BY AND CONSTRUED AND THE PERFORMANCE THEREOF
WILL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ITS CONFLICTS OF LAWS PROVISIONS THAT WOULD RESULT IN THE
APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed by
its duly authorized representative this ______ day of [ ]
AVSA, S.A.R.L.
By:
Title:
Signature:
EXHIBIT F
TECHNICAL DATA AND DOCUMENTATION
GENERAL
This Exhibit F lists the form, type, quantity and delivery dates for
the Technical Data and Documentation to be provided to the Buyer
pursuant to Clause 14 of the Agreement.
The Technical Data and Documentation are published in accordance with
ATA Specification 100 revision 23, with the exception of certain
Component Maintenance Manuals, which may be written to an ATA
Specification 100 revision other than revision 23.
The designation "C" after the title of a Technical Publication
indicates that such Technical Publication may be customized.
EXHIBIT F
1. ENGINEERING DOCUMENTS
1.1 Installation and Assembly Drawings (IAD)--C
The IAD will be delivered according to the Buyer's standard for the
major Assembly and Installation drawings, including detail drawings.
1.2 Drawing Number Index (DNI)--C
The DNI lists applicable drawings of the Aircraft delivered under the
Agreement.
1.3 Process and Material Specification (PMS)
The PMS contains data related to manufacturing processes, material
identification and treatments used in the construction and assembly of
the Aircraft.
1.4 Standards Manual (SM)
The SM contains data about Seller approved standards and includes cross
reference lists. The SM will include US standards/equivalents for all
hardware clamps, O-rings, bearings, fasteners, sealants, adhesive and
compounds, raw materials, processes and procedures.
2. MAINTENANCE AND ASSOCIATED MANUALS
2.1 APU Build-up Manual (ABM)
The ABM follows the format adopted for the Power Plant Build-up Manual.
2.2 Aircraft Maintenance Manual (AMM)--C
The component location section of the AMM will show those components
detailed in the AMM maintenance procedures. The troubleshooting part is
covered in Subparagraph 2.21 below.
*Aircraft Maintenance Manual Chapter 05 Time Limits (Service Life
Limits) and Maintenance Checks are only delivered in hard copies.
EXHIBIT F
2.3 Aircraft Schematics Manual (ASM)--C
The ASM is part of the Wiring Manual. Supplied as a separate manual for
schematics.
2.4 Aircraft Wiring Manual (AWM)--C
The AWM is part of the Wiring Manual. Supplied as a separate manual for
wirings.
2.5 Aircraft Wiring Lists (AWL)--C
The AWL is part of the Wiring Manual. Supplied as a separate document
for lists. The AWL includes wire terminations, connector, terminal,
strip locations, wire routings, and clamping diagrams.
2.6 Consumable Material List (CML)
The CML details the characteristics and gives procurement sources of
consumable materials such as grease, oil, etc.
2.7 Duct Repair Manual (DRM)
The DRM contains all the data necessary to locate, identify, repair
and/or replace sub-assemblies of metallic ducts. It also includes
details of tests necessary after repair.
2.8 Fuel Pipe Repair Manual (FPRM)
The FPRM provides workshop repair procedures and data for specific fuel
pipes, after removal from any aircraft of the Manufacturer of the type
of the Aircraft.
2.9 Illustrated Parts Catalog (IPC)--C
The IPC identifies and illustrates all line replaceable parts and units
of the aircraft, excluding the power plant parts.
2.10 Illustrated Parts Catalog (power plant) (PPIPC)--C
The PPIPC covers line replaceable parts and units of the power plant,
provided by the Propulsion Systems manufacturer.
2.11 Illustrated Tool and Equipment Manual (TEM)
The TEM provides information on Ground Equipment and Tools listed in
the Seller's Aircraft Maintenance Manual.
2.12 Maintenance Facility Planning (MFP)
The MFP provides information that will assist airline personnel
concerned with long term planning of ramp or terminal operations,
Aircraft maintenance on the ramp and in the hangar, overhaul and
testing of structure and system components.
2.13 Maintenance Planning Document (MPD)
The MPD provides maintenance data necessary to plan and conduct
Aircraft maintenance checks and inspections.
2.14 Power Plant Build-up Manual (PPBM)
The PPBM provides instructions for the installation of a quick engine
change kit on a bare engine.
2.15 Support Equipment Summary (SES)
The SES lists support equipment recommended by the Seller, the
Propulsion Systems manufacturer and Vendors.
2.16 Time Limits and Maintenance Checks/Service Limits and Maintenance
Checks (TLMC\SLMC)
The TLMC\SLMC document provides the Manufacturer's recommended
scheduled time limits for inspections and maintenance checks.
2.17 Tool\Equipment Drawings (▇▇▇)
TEDs will be supplied in the form of aperture cards for the Seller and,
when available, Vendor maintenance tools.
2.18 Tool and Equipment Drawing Index (TEI)
The TEI is an alpha-numeric listing of the TED's.
2.19 Tool and Equipment Bulletin (TEB)
The TEB provides advance information related to tools and test
equipment development.
2.20 Trouble Shooting Manual (TSM)--C
The TSM complements the CFDS and provides trouble-shooting data in the
following three levels:
Level 1 - Aimed at line use. Fault isolation guidance for
systems or parts of systems monitored mainly by CFDS.
Also guidance for systems not monitored by CFDS.
Level 2 - Aimed at hangar use. Fault isolation guidance for
non-CFDS monitored systems in the form of functional
block diagrams, charts and tables.
Level 3 - Aimed at engineering use. List of CFDS messages
and decoding of troubleshooting data (decoding of
coded messages provided by the CFDS). Level 3 is
supplied on floppy disk.
3. MISCELLANEOUS DOCUMENTATION
3.1 Airplane Characteristics for Airport Planning (AC)
The AC will be in general accordance with Specification NAS 3601.
3.2 Aircraft Recovery Manual (ARM)
The ARM provides the following planning information: preparing and
moving a disabled aircraft that may be obstructing airport traffic.
3.3 Cargo Loading System Manual (CLS)
The CLS details handling procedures for the Cargo Loading System.
3.4 Crash Crew Chart (CCC)
The CCC provides information concerning access to the Aircraft
interior, location of safety equipment, hazardous liquids, etc.
3.5 Guidelines for Customer Originated Changes (GCOC)
The GCOC provides production and presentation rules for the data
covering Buyer originated changes on the Aircraft to be incorporated by
the Seller in the Technical Data and Documentation as per Subclause
14.11 of the Agreement.
3.6 List of Radioactive and Hazardous Elements (LRE)
The LRE provides information on components and materials for which
specific precautions have to be taken.
3.7 List of Applicable Publications (LAP)--C
The LAP will record the Seller's various Airframe Technical Data and
Documentation indicating the last valid revision number and issue date.
3.8 Livestock Transportation Manual (LTM)
The LTM details the facilities, equipment and procedures necessary for
live animal transportation in aircraft of the Manufacturer of the type
of the Aircraft.
3.9 Service Bulletins (SB)--C
The Buyer will receive all Service Bulletins applicable to the
Aircraft.
3.10 Service Bulletin Index (SBI)
The SBI is a listing of all Service Bulletins issued in ATA 100 chapter
sequence.
The SBI provides details of SB number, SB title, associated
modification number, issue status, Vendor SB number (if applicable) and
affected fleet.
3.11 Service Information Letters (SIL)
SILs give information of a general nature and also about minor changes
or inspections the Buyer may wish to apply under the Buyer's authority.
3.12 Transportability Manual (TM)
The TM gives cargo hold dimensions for currently available cargo
Aircraft, transportation information and requirements for large
Aircraft components. Component dimensions, weights and shelf life
limitations are also given.
3.13 Supplier Product Support Agreements (SPSA)
The SPSA is a collection of product support conditions negotiated by
the Manufacturer with the suppliers of Aircraft equipment.
3.14 Vendor Information Manual (VIM)
The VIM provides Vendor contact information.
3.15 Vendor Information Manual (GSE) (VIM/GSE)
The VIM/GSE gives contact names and addresses of Ground Support
Equipment (GSE) vendors and their product support organizations.
4. OPERATIONAL MANUALS
4.1 Abnormal\Emergency Check List\Quick Reference Handbook (CL\QRH)--C
The CL is an extract from the FCOM presented as a booklet for quick
in-flight use.
4.2 FAA Approved Flight Manual (FM)--C
The AFM provides Aircraft performance operating limitations and other
flight data required by the relevant Airworthiness Authorities for
certification. It includes the Configuration Deviation List (CDL).
4.3 Flight Crew Operating Manual (FCOM)--C
The FCOM provides Aircraft and systems descriptions, normal, abnormal
and emergency procedures as well as operational performance.
4.4 Master Minimum Equipment List (MMEL)
The MMEL defines the components and the related conditions under which,
when the components are defective, the Aircraft may be cleared for
flight. In addition, the MMEL provides the necessary information to
establish the Buyer's own Minimum Equipment List (▇▇▇).
4.5 Performance Engineering Program (PEP)
The PEP consists of a Low Speed Performance data base and a High Speed
Performance data base together with their respective programs. The
Performance Engineering Program may be used by the Buyer under the
license conditions set forth in Appendix A to this Exhibit F.
The Low Speed Performance programs consist of the Take-off and Landing
Chart computation program (TLC) which permits the computation of:
- regulatory take-off and landing performance,
- noncertified take-off performance accounting for runway data and
weather, together with the Tabulation and Interpolation program (TAB),
issued with the AFM, which permits the reading, editing and
interpolation of the tables listed in the AFM.
The High Speed Performance programs are the In Flight Performance
computation program (IFP) which permits computation of Aircraft
performance for each flight phase and the Aircraft Performance
Monitoring program (APM) which permits analysis of Aircraft cruise
performance from data recorded during stabilized flight periods.
4.6 Performance Program Manual (PPM)
The PPM is the users' guide for the Performance Engineering Program
(PEP).
4.7 Weight and Balance Manual (WBM) and
Weight and Balance Manual Supplements--C
The corresponding supplements:
-Delivery Weighing Report,
-Equipment List,
will be delivered with each Aircraft.
5. OVERHAUL DATA
5.1 Cable Fabrication Manual (CFM)
The CFM contains all the data necessary to locate, identify,
manufacture and test control cables used on the Aircraft. An appendix
contains cable end fitting specification sheets, and detailed
manufacturing instructions.
5.2 Component Documentation Status (CDS)--C
The CDS lists Component Maintenance Manuals in accordance with
Subparagraphs 5.4 and 5.5 below.
5.3 Component Evolution List (CEL)
The CEL is a noncustomized document listing all components on the
Aircraft and also gives the evolution of each component.
The information is provided in order of:
- part number
- FSCM
- ATA reference.
5.4 Component Maintenance Manual Manufacturer (CMMM)
The CMMM contains all the data necessary to locate, identify and
maintain Aircraft components manufactured by the Seller.
5.5 Component Maintenance Manual Vendor (CMMV)
The Seller will ensure that each Vendor of repairable components will
deliver to the Buyer a Component Maintenance Manual Vendor with
revision service.
6. STRUCTURAL MANUALS
6.1 Nondestructive Testing Manual (NTM)
The NTM supplies Airframe data necessary to carry out nondestructive
testing.
6.2 Structural Repair Manual (SRM)
The SRM contains descriptive information for identification and repair
of the Airframe primary and secondary structure and will include
substantial structural analysis.
FORM
AC APERTURE CARD. Refers to 35mm film contained on punched aperture cards
CD CD-ROM.
D FLOPPY DISK
F MICROFILM. Refers to 16mm roll film in 3M type cartridges.
MP Refers to paper printed one side, unpunched quality will be suitable
for further reproduction or microfilming.
MT MAGNETIC TAPE
P1 PRINTED ONE SIDE. Refers to manuals in paper with print on one side of
the sheets only.
P2 PRINTED BOTH SIDES. Refers to manuals with print on both sides of the
sheets.
SMF SILVER MASTER FILM. Refers to thick diazo film suitable for further
reproduction.
+ Denotes a combined A319/A320/A321 Technical Publication.
* Denotes Technical Data and Documentation will be supplied in SGML
format if such format becomes available from the Manufacturer.
TYPE
C CUSTOMIZED. Refers to manuals which are customized to specific MSNs.
E ENVELOPE. Refers to manuals which are not customized.
P PRELIMINARY Refers to preliminary data or manuals which may consist of:
-either one time issue not maintained by revision service, or
-preliminary issues maintained by revision service until final manual
or data delivery, or
-supply of best available data under final format with progressive
completion through revision service.
DELIVERY
Delivery of Technical Data and Documentation is expressed either as the number
of days prior to delivery of the first Aircraft or as nil (0), which designates
the date of delivery of the first Aircraft.
It is agreed that the number of days indicated will be rounded up to the next
regular revision release date.
MANUALS AVAILABLE (headlines)
1 - ENGINEERING DOCUMENTS
2 - MAINTENANCE & ASSOCIATED MANUALS
3 - MISCELLANEOUS PUBLICATIONS
4 - OPERATIONAL MANUALS AND DATA
5 - OVERHAUL DATA
6 - STRUCTURAL MANUALS
EXHIBIT "F"
MANUALS AVAILABLE (detailed) Abbr Form Type Qty. Rev Deliv.
---- ---- ---- ---- --- ------
1. ENGINEERING DOCUMENTS
+* Installation and Assembly Drawings IAD C AN1 0
(including detail drawings)
+ Parts Usage (Effectivity) PU E AN 0
+ Schedule (Drawing Nomenclature) S E AN 0
*
+ Drawing Number Index DNI C AN 0
+ Process and Material Specification PMS E AN 0
*
+ Standards Manual SM E AN 0
+ Electrical Load Analysis ELA E 2 AN 0
2. MAINTENANCE & ASSOCIATED MANUALS
+ APU Build-up Manual ABM E AN 90
+ Aircraft Maintenance Manual AMM C 4 90
+ Aircraft Schematics Manual ASM C 4 90
+ Aircraft Wiring Manual AWM C 4 90
+ Aircraft Wiring Lists AWL C 4 90
+ Consumable Material List CML E AN 90
+ Component Location Manual CLM 4 90
+ Duct Repair Manual DRM E AN 90
+ Fuel Pipe Repair Manual FPRM E AN 90
+ Illustrated Parts Catalog IPC C 4 90
(Airframe)
+ Illustrated Parts Catalog PIPC C 4 90
(Power Plant)2
+ Illustrated Tool and Equipment TEM E AN 360
* Manual
+ Maintenance Facility Planning MFP E AN 90
+ Maintenance Planning Document MPD E AN 360
*
+ Power Plant Build-up Manual 3 PPBM E AN 90
+ Support Equipment Summary SES E AN 360
+ Time Limits and Maintenance TLMC/ C 4 90
Checks/Service Limits and SLMC
Maintenace Checks
+ Tool and Equipment Drawings ▇▇▇ E AN 360
+ Tool and Equipment Drawing Index TEI E AN 360
*
+ Trouble Shooting Manual TSM C 4 90
+ Aircraft Documentation Retrieval ADRES C 4 90
* System
+ Computer Assisted Aircraft CAATS C 4 90
* Troubleshooting
+ Time Limits and Maintenance Checks TLMC C 4 90
3. MISCELLANEOUS PUBLICATIONS
+ Airplane Characteristics for AC E AN 360
* Airport Planning
+ Aircraft Recovery Manual ARM E AN 90
Crash Crew Chart CCC E AN 180
+ Guidelines for Customer Originated GCOC E AN 0
Changes
+ List of Radioactive and Hazardous LRE E AN 90
Elements
+ List of Applicable Publications LAP C 4 90
+ Livestock Transportation Manual LTM E AN 90
+ Service Bulletins SB C AN 0
+ Service Bulletin Index SBI E AN 90
+ Service Information Letters SIL E AN 0
+ Technical Publications Combined TPCI C AN 90
* Index
+ Transportability Manual TM E AN 90
Supplier Product Support Agreements SPSA E AN 360
(SPSA)
* Vendor Information Manual VIM E AN 360
+ Vendor Information Manual GSE VIM\ E AN 360
* GSE
4. OPERATIONAL MANUALS AND DATA
+ Check List/Abnormal/Emergency/ CL/QRH C AN 90
Quick Reference Handbook
+ FAA Approved Flight Manual AFM C AN 0
+ Flight Crew Operating Manual FCOM C AN 90
+ Master Minimum Equipment List MMEL E AN 90
+ Performance Engineering Program PEP E AN 90
+ Performance Program Manual PPM E AN 90
+ Weight and Balance Manual WBM C AN 0
5. OVERHAUL DATA
+ Cable Fabrication Manual CFM E AN 90
+ Component Documentation Status CDS C AN 180
*
+ Component Evolution List4 CEL E AN 180
+ Component Maintenance Manual CMMM E AN 180
* Airframe Manufacturer
+ Component Maintenance Manual Vendor CMMV P2 E 10 AN 180
*
6. STRUCTURAL MANUALS
+ Nondestructive Testing Manual NTM E 4 90
+ Structural Repair Manual SRM E 4 90
APPENDIX 1 TO EXHIBIT F
LICENSE FOR USE OF THE PERFORMANCE ENGINEER'S PROGRAMS
1. Grant
The Seller grants the Buyer the right to use the Performance Engineer's
Program (PEP) in machine-readable form during the term of this
license on a single computer.
Use of the PEP in readable form will be limited to one (1) copy other
than the copies contained in the single computer and copies produced
for checkpoint and restart purposes or additional copies made with the
consent of the Seller for a specific need.
2. Merging
The PEP may be used and adapted in machine-readable form for the
purpose of merging it into other program material of the Buyer but on
termination of this Agreement; the PEP will be removed from the other
program material with which it has been merged.
The Buyer agrees to reproduce the copyright and other notices as they
appear on or within the original media on any copies, which the Buyer
makes of the PEP.
3. Personal License
The above-described license is personal to the Buyer, non-transferable
and non-exclusive.
4. Installation
It is the Buyer's responsibility to install the PEP and to perform any
merging and checks. The Seller will however assist the Buyer's
operations engineers in the initial phase following the delivery of the
PEP until such personnel reach the familiarization level required to
make inputs and correlate outputs.
5. Proprietary Rights and Nondisclosure
5.1 The PEP and the copyright and other proprietary rights of whatever
nature in the PEP are and will remain with the Seller. The PEP and its
contents are designated as confidential.
5.2 The Buyer undertakes not to disclose the PEP or parts thereof and its
contents to any third party without the prior written consent of the
Seller. In so far as it is necessary to disclose aspects of the PEP to
employees, such disclosure is permitted only for the purpose for which
the PEP is supplied and only to the employee who needs to know the
same.
6. Conditions of Use
6.1 The Seller does not warrant that the PEP will not contain errors.
However, should the PEP be found to contain any error within thirty
(30) days of delivery, the Buyer will notify the Seller promptly
thereof and the Seller will take all proper steps to correct the same
at its own expense.
6.2 The Buyer will ensure that the PEP is correctly used in appropriate
machines as indicated in the Performance Programs Manual (PPM) and that
staff are properly trained to use the same, to trace and correct
running faults, to restart and recover after fault and to operate
suitable checks for accuracy of input and output.
6.3 It is understood that the PPM is the user's guide of the PEP and the
Buyer will undertake to use the PEP in accordance with the PPM.
6.4 THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND REMEDIES
OF THE BUYER SET FORTH IN THIS LICENCE ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES
ALL OTHER WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND THE
RIGHTS, CLAIMS OR REMEDIES OF THE BUYER AGAINST THE SELLER, EXPRESS OR
IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO ANY NON
CONFORMITY OR DEFECT IN THE PEP DELIVERED UNDER THIS LICENCE.
7. Duration
The rights under this license will be granted to the Buyer as long as
the Buyer operates a Seller's Aircraft model to which the PEP refers.
When the Buyer stops operating said Aircraft model, the Buyer will
return the PEP and any copies thereof to the Seller, accompanied by a
notice certifying that the Buyer has returned all existing copies.
APPENDIX 2 TO EXHIBIT F
LICENSE FOR USE OF CD-ROM
1. Grant
1.1 The Seller grants the Buyer the right to use the Aircraft Documentation
Retrieval System (ADRES) and/or the Computer Assisted Aircraft Trouble
Shooting (CAATS) on CD-ROM for the term of this License. Use of ADRES
and/or CAATS will be limited to the number of copies defined between
the parties.
For clarification, it is hereby stated that the Power Plant IPC is not
part of the electronic IPC and is only available on other media (paper
or film).
1.2 The above grant will be free of charge for as long as the revisions of
CAATS and ADRES are free of charge in accordance with Clause 14. At the
end of such period(s) license fees will be charged to the Buyer at the
price stated in the then current Seller's Customer Services Catalog.
2. Term
The rights under the License will be granted from the date of first
delivery of ADRES and/or CAATS as long as the Buyer operates the
Aircraft or until a replacement product will be provided by the Seller,
whichever occurs first. Within thirty (30) days of termination, the
Buyer will return ADRES and/or CAATS and all copies thereof to the
Seller.
3. Revision Service
The Seller will provide revision service for ADRES and/or CAATS during
the term. The revision service will be based on the revision service,
which the Seller provides for the documentation in paper or film
format.
ADRES and/or CAATS CD-ROM will be revised concurrently with the paper
and film deliveries. Temporary revisions will be provided in digital
format under the form of 3-1/2 floppy disk. The retrieval software for
such temporary revisions will be embodied on the CAATS and ADRES
CD-ROM.
4 Personal License
The License is personal to the Buyer, nontransferable and nonexclusive.
The Buyer will not permit any third party to use ADRES and/or CAATS,
nor will it transfer or sublicense ADRES and/or CAATS to any third
party, without prior written consent from the Seller.
5. Installation
The Seller will provide the list of hardware on which ADRES and/or
CAATS will be installed. The Buyer will be responsible for procuring
such hardware and installing ADRES and/or CAATS.
6. Proprietary Rights
ADRES and/or CAATS are proprietary to the Seller and the copyright and
all other proprietary rights in ADRES and/or CAATS are and will remain
the property of the Seller.
7. Copyright Indemnity
The Seller will defend and indemnify the Buyer against any claim that
the normal use of ADRES and/or CAATS infringes the intellectual
property rights of any third party, provided that the Buyer
(i) immediately notifies the Seller of any such claim;
(ii) makes no admission or settlement of any claim;
(iii) allows the Seller to have sole control of all negotiations
for its settlement;
(iv) gives the Seller all reasonable assistance in connection
therewith.
8. Confidentiality
ADRES and/or CAATS and their contents are designated as confidential.
The Buyer undertakes not to disclose ADRES and/or CAATS or parts
thereof to any third party without the prior written consent of the
Seller. In so far as it is necessary to disclose aspects of ADRES
and/or CAATS to the employees, such disclosure is permitted solely for
the purpose for which ADRES and/or CAATS are supplied and only to those
employees who need to know the same.
9. Conditions of Use
9.1 The Buyer will not make any copies of ADRES and/or CAATS, except for
installation purposes.
9.2 The Seller does not warrant that the operation of ADRES and/or CAATS
will be error free. In the event of an error occurring within thirty
(30) days of delivery, the sole and exclusive liability of the Seller
will be, at its expense, to correct ADRES and/or CAATS in the following
revision.
9.3 THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND REMEDIES
OF THE BUYER SET FORTH IN THIS LICENCE ARE EXCLUSIVE AND IN
SUBSTITUTION FOR, AND THE BUYER HEREBY WAIVES, RELEASES AND RENOUNCES
ALL OTHER WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLER AND THE
RIGHTS, CLAIMS OR REMEDIES OF THE BUYER AGAINST THE SELLER, EXPRESS OR
IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO ANY NON
CONFORMITY OR DEFECT IN THE ADRES AND/OR CAATS DELIVERED UNDER THIS
LICENCE.
10. Training
In addition to the user guide supplied with ADRES and/or CAATS,
training and other assistance may be provided on the Buyer's request at
conditions to be mutually agreed.
11. Replacement of Product
For clarification purposes it is hereby expressly stated that ADRES
and/or CAATS will be offered for a limited time period, not
exceeding the term of this License. In the event that the Seller
should offer a replacement product, the conditions for using such
product will be subject to a separate agreement.
EXHIBIT G
SELLER PRICE REVISION FORMULA
l. BASE PRICE
----------
The Base Price of the A318 Aircraft is as quoted in Clause 3.1.1 of the
Agreement. The Base Price of the Airframe of the A319 Aircraft is as
quoted in Clause 3.1.2.2 of the Agreement.
2. BASE PERIOD
The above Base Prices have been established in accordance with the
averaged economic conditions prevailing in December 1997/January
1998/February 1998 and corresponding to theoretical delivery conditions
prevailing in January 1999 as defined by ECIb and ICb index values
indicated in Paragraph 4 of this Exhibit G.
These Base Prices are subject to adjustment for changes in economic
conditions as measured by data obtained from the US Department of
Labor, Bureau of Labor Statistics, and in accordance with the
provisions of Paragraphs 4 and 5 of this Exhibit G.
ECIb and ICb index values indicated in Paragraph 4 of this Exhibit G
will not be subject to any revision of these indexes.
3. REFERENCE INDEXES
Labor Index: Published quarterly by the US Department of Labor, Bureau
of Labor Statistics, in "News" (Table 6: "Employment Cost Index for
wages and salaries for private industry workers by industry and
occupational group" (NOT SEASONALLY ADJUSTED), or such other names that
may be from time to time used for the publication title and/or table.
The index is found under aircraft manufacturing with a standard
industrial classification code of SIC 3721 and hereinafter is referred
to as "ECI-SIC-3721W" (Base month and year June 1989 = 100).
Material Index: "Industrial Commodities" (hereinafter referred to as
"IC-Index"), published monthly by the US Department of Labor, Bureau of
Labor Statistics, in "PPI Detailed Report" (Table 6: Producer prices
indexes and percent changes for commodity groupings and individual
items, not seasonally adjusted) (Base year 1982 = 100) or such other
names which may be from time to time used for the publication title
and/or table.
4 - REVISION FORMULA
Pn = (Pb + F) (0.75 ECIn/ECIb + 0.25 ICn/ICb)
Where
Pn = Revised Base Price of the Airframe.
Pb = Base Price of the Airframe at economic conditions
December 1997/January 1998/February 1998 averaged
(January 1999 delivery conditions).
F = (0.005 x N x Pb) Where N = The calendar year of
delivery of the Aircraft minus 1999.
ECIn = The arithmetic average of the latest published
values available at the date of Aircraft delivery for
ECI-SIC-3721W for the ▇▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇ months
prior to the month of delivery of the Aircraft (1
decimal), where the quarterly value for the third
month of a quarter (March, June, September and
December) will be deemed to apply for the two
preceding months.
ECIb = ECI-SIC-3721W for December l997/January 1998/February
1998 averaged (= 134.7).
ICn = The arithmetic average of the latest published
values available at the date of Aircraft delivery for
the IC-Index for the ▇▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇ months prior
to the month of delivery of the Aircraft (l decimal).
ICb = IC-Index for December 1997/January 1998/February 199
averaged (=126.1).
In determining the Revised Base Price at delivery of the Aircraft, each
quotient will be calculated to the nearest ten thousandth (4 decimals).
If the next succeeding place is five (5) or more, the preceding decimal
place will be raised to the next higher figure. The final factor will
be rounded to the nearest ten thousandth (4 decimals). After final
computation, Pn will be rounded to the next whole number (0.5 or more
rounded to l).
5. GENERAL PROVISIONS
5.1 Substitution of Indexes
In the event that:
(i) the US Department of Labor substantially revises the
methodology of calculation of any of the indexes referred to
hereabove, or
(ii) the US Department of Labor discontinues, either temporarily or
permanently, any of the indexes referred to hereabove, or
(iii) the data samples used to calculate any of the indexes referred
to hereabove are substantially changed,
the Seller will select a substitute index.
Such substitute index will reflect as closely as possible the actual
variations of the wages or of the material costs, as the case may be,
used in the calculation of the original index.
As a result of this selection of a substitute index, the Seller will
make an appropriate adjustment to its price revision formula, allowing
to combine the successive utilization of the original index and of the
substitute index.
5.2 Final Index Values
The Revised Base Price at the date of Aircraft delivery will be final
and will not be subject to further adjustments of any kind and for any
reason to the applicable indexes as published at the date of Aircraft
delivery.
EXHIBIT H
PROPULSION SYSTEMS PRICE REVISION FORMULA
l. REFERENCE PRICE
---------------
The Reference Price of a set of two (2) CFM International 56-5B5/P
engines and additional equipment is as quoted in Clause 3.1.2.3 of the
Agreement.
This Reference Price is valid for Aircraft delivered no later than
December 31, 2007, and is subject to adjustment for changes in economic
conditions as measured by data obtained from the US Department of
Labor, Bureau of Labor Statistics, and in accordance with the
provisions of Paragraphs 4 and 5 of this Exhibit H.
2. REFERENCE PERIOD - REFERENCE COMPOSITE PRICE INDEX
The above Reference Price has been established in accordance with the
economic conditions prevailing in July 1996 (January 1997 theoretical
delivery conditions), as defined, according to CFM International, by
the Reference Composite Price Index of 145.03.
3. REFERENCE INDEXES
Labor Index: "Aircraft Engines and Engine Parts," Standard Industrial
Classification 3724--Average hourly earnings (hereinafter referred to
as "HE SIC 3724"), published by the US Department of Labor, Bureau of
Labor Statistics, in "Employment and Earnings," (Table B-15: Average
hours and earnings of production or nonsupervisory workers on private
nonfarm payrolls by detailed industry) or such other names that may be
from time to time used for the publication title and/or table.
Material Index (I): "Industrial Commodities" (hereinafter referred to
as "IC-Index"), published monthly by the US Department of Labor, Bureau
of Labor Statistics, in "PPI Detailed Report" (Table 6: Producer prices
indexes and percent changes for commodity groupings and individual
items, not seasonally adjusted) (Base year 1982 = 100) or such other
names that may be from time to time used for the publication title
and/or table.
Material Index (II): "Metals and Metal Products" Code l0 (hereinafter
referred to as "MMP-Index"), published monthly by the US Department of
Labor, Bureau of Labor Statistics, in "PPI Detailed Report" (Table 6:
Producer prices indexes and percent changes for commodity groupings and
individual items, not seasonally adjusted) (Base year 1982 = 100) or
such other names that may be from time to time used for the publication
title and/or table.
Energy Index: "Fuels and Related Products and Power" Code 5
(hereinafter referred to as "EP-Index"), published monthly by the US
Department of Labor, Bureau of Labor Statistics, in "PPI Detailed
Report" (Table 6: Producer prices indexes and percent changes for
commodity groupings and individual items, not seasonally adjusted)
(Base year 1982 = 100) or such other names that may be from time to
time used for the publication title and/or table.
4. REVISION FORMULA
Pn = Pb x CPIn
145.03
Where
Pn = Revised Reference Price of a set of two (2)engines at
delivery of the Aircraft.
Pb = Reference Price as defined above.
CPIn = Composite Price Index for the sixth month prior to
the month of delivery of the Aircraft.
Said Composite Price Index is composed as follows:
CPIn = 0.55 (HEn x 100) + 0.10 ICn + 0.25 MMPn + 0.10 EPn
---
(11.16 )
Where
HEn = HE SIC 3724 for the sixth month prior to the month of
delivery of the Aircraft; the quotient HEn/11.16 is
rounded to the nearest third decimal place. The
product by 0.55 is rounded to the nearest second
decimal place.
ICn = IC-Index for the sixth month prior to the month of
delivery of the Aircraft.
MMPn = MMP-Index for the sixth month prior to the month of
delivery of th Aircraft. The product by 0.25 is
rounded to the nearest second decimal place.
EPn = EP-Index for the sixth month prior to the month of
delivery of the Aircraft.
The Composite Price Index will be determined to the second decimal
place. If the next succeeding decimal place is five (5) or more, the
preceding decimal figure will be raised to the next higher figure.
The final factor will be rounded to the nearest thousandth (3
decimals).
5. GENERAL PROVISIONS
5.1 The Revised Reference Price at delivery of the Aircraft will be the
final price and will not be subject to further adjustments in the
indexes.
5.2 If no final index value is available for any of the applicable months,
the published preliminary figures will be the basis on which the
Revised Reference Price will be computed.
5.3 If the US Department of Labor substantially revises the methodology of
calculation of the indexes referred to in this Exhibit H or
discontinues any of these indexes, AVSA will, in agreement with CFM
International, apply a substitute for the revised or discontinued
index, such substitute index to lead in application to the same
adjustment result, insofar as possible, as would have been achieved by
continuing the use of the original index as it may have fluctuated had
it not been revised or discontinued.
Appropriate revision of the formula will be made to accomplish this
result.
5.4 Should the above escalation provisions become null and void by action
of the US Government, the Reference Price will be adjusted to reflect
increases in the cost of labor, material and fuel which have occurred
from the period represented by the applicable Reference Price Indexes
to the sixth month prior to the scheduled delivery of the Aircraft.
5.5 The Revised Reference Price at delivery of the Aircraft in no event
will be less than the Reference Price defined in Paragraph 1 of this
Exhibit H.
EXHIBIT I
CONFIDENTIALITY TERMS
The minimum requirements for confidentiality agreements pertaining to the
disclosure of any Confidential Material ("Confidentiality Agreement(s)") are as
follow.
1. Confidential Material is identified as nonpublic, proprietary and
confidential, provided that Confidential Material will not include information
to the extent that such information (i) is already known to the recipient, or
(ii) is or becomes public knowledge or ceases to remain confidential, other than
as a result of a breach by the recipient of its obligations under the
Confidentiality Agreement.
2. The Confidentiality Agreement will cover oral, electronic or written
disclosures of the contents of Confidential Material, whether in full or in
summary form.
3. Subject to any legal or governmental disclosure requirements, the receiving
party will disclose Confidential Material only to those of its agents, employees
and/or advisors who have a need to know in order to accomplish the purpose for
which the Confidential Material is given, and will be used only to accomplish
such purpose.
4. All originals and any copy made of Confidential Material will be clearly
marked as confidential and subject to the Confidentiality Agreement, and copies
that are no longer needed for the purposes for which they were given will be
returned to the Buyer.
5. Confidentiality Agreements, insofar as they pertain to Technical Data and
Documentation, will be for a term of *. With respect to all other Confidential
Material, a term of * after delivery of the last Aircraft will be applied to
Confidentiality Agreements.
