EXHIBIT 10.3
PURCHASE AGREEMENT ASSIGNMENT
dated as of November 13, 2001
between
SOUTHWEST AIRLINES CO.,
Seller
and
THE AMOR TRUST,
Buyer
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CONSENT AND AGREEMENT
by
THE BOEING COMPANY
----------
ENGINE CONSENT AND AGREEMENT
by
CFM INTERNATIONAL, INC.
----------
Nineteen Boeing Model 737-7H4 Aircraft
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*** PURSUANT TO 17 CFR 240.24B--2, CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO A CONFIDENTIAL TREATMENT APPLICATION FILED WITH THE COMMISSION.
TABLE OF CONTENTS
PAGE
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Section 1. Definitions....................................................................................1
Section 2. Assignment; Rights Reserved....................................................................3
Section 3. Representations and Warranties.................................................................4
Section 4. Acceptance of Assignment; Delivery Dates.......................................................4
Section 5. Rights of Seller in Absence of Default.........................................................4
Section 6. Certain Rights and Obligations of the Parties..................................................6
Section 7. Further Assignment.............................................................................7
Section 8. Further Assurances.............................................................................7
Section 9. No Amendment of Purchase Agreement or General Terms Agreement..................................7
Section 10. Nondisclosure..................................................................................7
Section 11. Miscellaneous..................................................................................7
Exhibit A - Consent and Agreement
Exhibit B - Engine Consent and Agreement
Exhibit C - Deferred Delivery Date Notice
Schedule I - Aircraft
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PURCHASE AGREEMENT ASSIGNMENT
THIS
PURCHASE AGREEMENT ASSIGNMENT (this "ASSIGNMENT") dated as of
November 13, 2001 is between
SOUTHWEST AIRLINES CO., a Texas corporation
("SELLER") and THE AMOR TRUST, acting through the Owner Trustee ("BUYER").
WITNESSETH:
WHEREAS, Seller and The Boeing Company, a Delaware corporation (the
"MANUFACTURER") are parties to the Purchase Agreement (as hereinafter defined),
providing for, inter alia, the sale by the Manufacturer to Seller of the
Aircraft (as hereinafter defined);
WHEREAS, Buyer wishes to acquire certain rights and interests under the
Purchase Agreement and the General Terms Agreement (as hereinafter defined) and
Seller, on the terms and conditions hereinafter set forth, is willing to assign
and sell to Buyer certain of Seller's rights and interests under the Purchase
Agreement and the General Terms Agreement, and Buyer is willing to accept such
assignment and sale pursuant to the terms of this Assignment;
WHEREAS, the Manufacturer is willing to execute and deliver to Buyer,
Seller and the Indenture Trustee (as hereinafter defined) a consent and
agreement (the "CONSENT AND AGREEMENT") to the provisions hereof in
substantially the form of Exhibit A hereto; and
WHEREAS, CFM International, Inc., a Delaware corporation (the "ENGINE
MANUFACTURER") is willing to execute and deliver to Buyer, Seller and the
Indenture Trustee a consent and agreement (the "ENGINE CONSENT AND AGREEMENT")
to the provisions hereof in substantially the form of Exhibit B hereto.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the parties hereto
agree as follows:
SECTION 1. Definitions. For all purposes of this Assignment, except as
otherwise expressly provided for or unless the context otherwise requires, the
following terms shall have the following meanings:
"AIRCRAFT" shall mean each of the nineteen (19) Boeing Model 737-7H4
aircraft bearing manufacturer's serial numbers set forth on Schedule 1 hereto,
in each case including the relevant Engines installed or to be installed
thereon.
"AIRCRAFT PRICE" for any Aircraft shall have the meaning specified in
the Purchase Agreement.
"ACQUISITION AGREEMENT" shall mean the Aircraft Acquisition and Sale
Agreement dated as of the date hereof by and among Buyer, Seller, the Owner
Trustee and the Indenture Trustee, as the same may be amended, modified or
supplemented in accordance with the terms thereof.
"BDSC" shall mean Boeing Domestic Sales Corporation, a Washington
Corporation.
"BDSC AIRCRAFT" shall mean the Aircraft bearing manufacturer's serial
number 29818.
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Purchase Agreement Assignment]
"BFE" shall have the meaning specified in the Purchase Agreement.
"DEFERRED DELIVERY DATE NOTICE" shall mean, with respect to each
Aircraft, a notice in the form set out of Exhibit C to this Assignment executed
by Buyer and Seller.
"DELIVERY DATE" shall mean, in respect of an Aircraft, the date
notified by the Manufacturer to Buyer and the Indenture Trustee pursuant to
Section 4(b) hereof as the delivery date for such Aircraft.
"ENGINE WARRANTIES" shall have the meaning set forth in Section 2 of
Exhibit B of the General Terms Agreement.
"ENGINES" shall have the meaning specified in the Purchase Agreement.
"GENERAL TERMS AGREEMENT" shall mean the General Terms Agreement 6-3418
dated May 29, 1981 between Seller and the Engine Manufacturer together with all
letter agreements and supplements thereto as in effect on the date hereof, as
the same may be modified, amended or supplemented in accordance with the terms
thereof and, in respect of the Engines, hereof.
"INDENTURE" shall mean the Trust Indenture and Security Agreement dated
as of the date hereof by and among Buyer, Wilmington Trust Company, in its
individual capacity and as owner trustee, and the Indenture Trustee, as the same
may be amended, modified or supplemented in accordance with the terms thereof.
"INDENTURE EVENT OF DEFAULT" shall have the meaning set forth in the
Indenture.
"INDENTURE TRUSTEE" shall mean Xxxxx Fargo Bank Northwest, National
Association, not in its individual capacity but solely as indenture trustee.
"OWNER TRUSTEE" shall mean Wilmington Trust Company, not in its
individual capacity but solely as owner trustee.
"PROGRESS PAYMENTS" for any Aircraft shall mean the advance payments
made on account of such Aircraft by, or on behalf of, Seller under the Purchase
Agreement.
"PURCHASE AGREEMENT" shall mean the Purchase Agreement No. 1810 dated
as of January 19, 1994 between Seller and the Manufacturer together with all
letter agreements and supplements thereto as in effect on the date hereof, as
the same may be modified, amended or supplemented in accordance with the terms
thereof and, in respect of the Aircraft, hereof.
"PURCHASE PRICE BALANCE" shall mean, in respect of an Aircraft, the
amount notified by the Manufacturer to Buyer pursuant to Section 4(b) as the
purchase price balance for such Aircraft; such amount being the outstanding
amount due to the Manufacturer for such Aircraft on the Delivery Date therefor
(as specified in an invoice from the Manufacturer to Buyer).
All other terms used herein and not otherwise defined herein shall have
the respective meanings set forth in the Acquisition Agreement.
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Purchase Agreement Assignment]
SECTION 2. Assignment; Rights Reserved. Subject to the provisions of
Section 5(a) hereof, Seller does hereby sell, assign, transfer and set over unto
Buyer, its successors and permitted assigns, all of Seller's rights and
interests in and to the Purchase Agreement as and to the extent they relate to
the Aircraft and the Engine Warranties set forth in the General Terms Agreement
as and to the extent they relate to the Engines, except as and to the extent
expressly reserved below, including in such assignment and sale:
(a) the right upon valid tender by the Manufacturer or, in
respect of the BDSC Aircraft, BDSC to purchase each Aircraft pursuant to the
Purchase Agreement on the Delivery Date therefor, and the right, upon payment of
the Purchase Price Balance for such Aircraft, to take title to such Aircraft and
to be named the "Buyer" in the xxxx of sale and invoice to be delivered by the
Manufacturer or, in respect of the BDSC Aircraft, BDSC for such Aircraft
pursuant to the Purchase Agreement;
(b) all claims for damages in respect of the Aircraft arising
as a result of any default by the Manufacturer under the Purchase Agreement in
respect of the Aircraft or by the Engine Manufacturer under the Engine
Warranties set forth in the General Terms Agreement in respect of the Aircraft
or by any supplier of parts or equipment installed on or in the Aircraft;
(c) all warranty, performance guarantee, spare part and
indemnity provisions contained in the Purchase Agreement and the Engine
Warranties set forth in the General Terms Agreement and all claims arising
thereunder in respect of the Aircraft;
(d) any and all rights of Seller to compel performance of the
terms of the Purchase Agreement and the Engine Warranties set forth in the
General Terms Agreement in respect of the Aircraft; and
(e) all Seller's rights and interests in or arising out of
(including any credits for or repayment of) any advance or progress payments
made or to be made by Seller in respect of the Aircraft under the Purchase
Agreement and any other payments or deposits made by Seller in respect of the
Aircraft under the Purchase Agreement or any other agreement or amounts credited
or to be credited (including all credit memos and escalation sharing and
reconciliation amounts) or paid or to be paid by the Manufacturer to Seller
under the Purchase Agreement;
reserving exclusively to Seller solely for the purposes of this Assignment,
however:
(i) all Seller's rights and interests in and to the Purchase
Agreement and the General Terms Agreement as and to the extent that it
relates to aircraft other than the Aircraft or the purchase or
operation of such other aircraft and to the extent that it relates to
any other matters not directly pertaining to the Aircraft;
(ii) the right to obtain services (other than in respect of
the Aircraft), training, data and demonstration and test flights
pursuant to the Purchase Agreement;
(iii) the right to maintain plant representatives at the
Manufacturer's plant pursuant to the Purchase Agreement; and
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Purchase Agreement Assignment]
(iv) with respect to the Aircraft so long, and only so long,
as the Manufacturer shall not have received notice from the Indenture
Trustee as set forth in Section 5(c) hereof that an Indenture Event of
Default has occurred and is continuing, all rights to furnish BFE and
to demand, accept and retain all rights in and to all property (other
than the Aircraft) and services of any kind which the Manufacturer is
obligated to provide or does provide pursuant to the Purchase Agreement
with respect to the Aircraft and which are assigned to Buyer hereunder.
SECTION 3. Representations and Warranties. Seller does hereby represent
and warrant that (a) it has furnished to Buyer a true, correct and complete copy
of the Purchase Agreement and the Engine Warranties set forth in the General
Terms Agreement and (b) each of the Purchase Agreement and the General Terms
Agreement is in full force and effect and Seller is not in default thereunder.
Seller does hereby further represent and warrant that Seller has not assigned or
pledged, and hereby covenants that it shall not assign or pledge, so long as
this Assignment shall remain in effect, the whole or any part of the rights
hereby assigned or any of its rights in respect of the Aircraft to anyone other
than Buyer.
SECTION 4. Acceptance of Assignment; Delivery Dates.
(a) Buyer hereby accepts the assignment and sale contained in
Section 2 hereof.
(b) Each Aircraft is scheduled to be delivered by the
Manufacturer under the Purchase Agreement during the respective months set forth
in Column (B) of Schedule 1 hereto. Not less than five Business Days prior to
the proposed delivery date for an Aircraft, Seller shall cause the Manufacturer
to provide written notice to Buyer of (i) the proposed delivery date for such
Aircraft which shall be a Business Day within the respective delivery month
(each, a "DELIVERY DATE"), (ii) the manufacturer's serial numbers of the Engines
to be installed on such Aircraft and (iii) the amount of the Purchase Price
Balance. Buyer and Seller agree that Buyer's liability in respect of the
outstanding purchase price for an Aircraft shall not exceed the Purchase Price
Balance for such Aircraft. Upon receipt of the Manufacturer's notice, Buyer
shall promptly provide written notice to the Manufacturer of Buyer's authorized
representative for purposes of taking delivery of such Aircraft (who shall be,
so long as no Indenture Event of Default is continuing, a representative of
Seller).
SECTION 5. Rights of Seller in Absence of Default.
(a) Notwithstanding the foregoing, if and so long as the
Manufacturer and the Engine Manufacturer shall not have received notice from the
Indenture Trustee as set forth in Section 5(c) hereof that an Indenture Event of
Default has occurred and is continuing, (1) Buyer authorizes Seller, on behalf
of and to the exclusion of Buyer, to exercise in Seller's own name (i) such
rights and powers of Buyer under the Purchase Agreement and the Engine
Warranties and (ii) such rights as Buyer may have with respect to the Aircraft
under any warranty, covenant, representation, service life policy, aircraft
performance guarantee, indemnity or product support agreement of the
Manufacturer, the Engine Manufacturer or any subcontractor or vendor with
respect thereto and to retain any recovery or benefit resulting from the
enforcement of any warranty, covenant, representation, service life policy,
aircraft performance guarantee, indemnity
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Purchase Agreement Assignment]
or product support agreement of the Manufacturer, the Engine Manufacturer or any
subcontractor or vendor in respect of the Aircraft, except that Seller may not
enter into any change order or other amendment, modification or supplement to
the Purchase Agreement or the Engine Warranties without Buyer's prior written
consent if such change order, amendment, modification or supplement would result
in any rescission, cancellation or termination of the Purchase Agreement or the
Engine Warranties as to the Aircraft or materially diminish the rights and
interests assigned hereunder, and (2) Buyer shall, at Seller's expense,
cooperate with Seller and take such actions as Seller reasonably deems necessary
to enable Seller to enforce such rights and claims.
(b) Effective upon the receipt by the Manufacturer and the
Engine Manufacturer of written notice from the Indenture Trustee that an
Indenture Event of Default has occurred and is continuing and thereafter until
the Manufacturer and the Engine Manufacturer shall have received written notice
from the Indenture Trustee that such Indenture Event of Default has been cured
or waived, unless the Indenture Trustee, in its sole discretion shall notify
Manufacturer and the Engine Manufacturer to the contrary, the authorization
given to Seller under Section 5(a) hereof to enforce such rights and claims
shall thenceforth cease to be effective and Buyer and its successors and
permitted assigns shall, to the exclusion of Seller, be entitled to assert and
enforce such rights and claims as substitute party plaintiff or otherwise, and
Seller shall, at the request of Buyer or its successors or permitted assigns and
at Seller's expense, cooperate with and take such action as is reasonably
necessary to enable Buyer and its successors and permitted assigns to enforce
such rights and claims. In furtherance of the foregoing, Seller hereby
constitutes and appoints Buyer, its successors and permitted assigns, Seller's
true and lawful attorney, irrevocably (it being acknowledged that such
appointment is coupled with an interest, namely Buyer's rights acquired and to
be acquired hereunder) with full power (in the name of Seller or otherwise) to
ask, require, demand, receive, compromise, settle, compound and give acquittance
for any and all monies and claims for monies due and to become due under, or
arising out of, the Purchase Agreement in respect of the Aircraft, to the extent
that the same have been assigned by this Assignment, and for such period as
Buyer may exercise rights with respect thereto hereunder, to endorse any checks
or other instruments or orders in connection therewith and to file any claims or
take any action or institute (or, if previously commenced, assume control of)
any proceedings and to obtain any recovery in connection therewith that Buyer
may deem to be necessary or advisable in the premises.
(c) For all purposes of this Assignment, the Manufacturer and
the Engine Manufacturer shall not be deemed to have knowledge of an Indenture
Event of Default or of the discontinuance or waiver of an Indenture Event of
Default unless and until the Manufacturer and the Engine Manufacturer shall have
received written notice (including by mail, telex or telecopy) thereof from the
Indenture Trustee addressed, if to the Manufacturer, to the Vice President -
Contracts at X.X. Xxx 0000, Mail Code 21-34, Xxxxxxx, Xxxxxxxxxx 00000, if by
mail and to 32-9430 (Answerback BOEINGREN RNTN), if by telex and to (425)
237-1706, if by telecopy, and, if to the Engine Manufacturer, to the Director of
Commercial Contracts at 0 Xxxxxx Xxx, Xxxxxxxxxx Xxxx 00000, if by mail and to
(000) 000-0000 if by telecopy, and in each case, in acting in accordance with
the terms and conditions of the Purchase Agreement and this Assignment, the
Manufacturer and the Engine Manufacturer may rely conclusively upon any such
notice.
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Purchase Agreement Assignment]
SECTION 6. Certain Rights and Obligations of the Parties.
(a) Anything herein contained to the contrary notwithstanding:
(i) Seller shall at all times remain liable to the Manufacturer and the Engine
Manufacturer under the Purchase Agreement and the General Terms Agreement in
respect of the Aircraft to perform all of its duties and obligations of "Buyer"
thereunder to the same extent as if this Assignment had not been executed; (ii)
the exercise by Buyer of any of the rights assigned hereunder shall not release
Seller from any of its duties or obligations to the Manufacturer and the Engine
Manufacturer under the Purchase Agreement or the General Terms Agreement in
respect of the Aircraft except to the extent that such exercise by Buyer shall
constitute performance of such duties and obligations; and (iii) Seller shall at
all times remain liable to perform the obligations of "Buyer" under Part E of
Exhibit C of the Purchase Agreement.
(b) Without in any way releasing Seller from any of its duties
or obligations under the Purchase Agreement and the General Terms Agreement,
Buyer confirms for the benefit of the Manufacturer and the Engine Manufacturer,
that, insofar as the provisions of the Purchase Agreement and the General Terms
Agreement relate to the Aircraft, in exercising any rights under the Purchase
Agreement or the General Terms Agreement, or in making any claim with respect to
the Aircraft or other goods and services delivered or to be delivered pursuant
to the Purchase Agreement or the General Terms Agreement, the terms and
conditions of the Purchase Agreement (including, without limitation, those
relating to any exclusion or limitation of liabilities or warranties as set
forth in Article 12 thereof or those relating to any indemnity and insurance as
set forth in Exhibit C, Part E thereof) or the General Terms Agreement, as the
case may be, shall apply to, and be binding upon, Buyer to the same extent as
Seller.
(c) Seller and Buyer agree, expressly for the benefit of the
Manufacturer and the Engine manufacturer, that nothing contained herein shall
(i) subject the Manufacturer or the Engine Manufacturer to any liability to
which it would not otherwise be subject under the Purchase Agreement or the
General Terms Agreement, (ii) modify in any respect the Manufacturer's or the
Engine Manufacturer's contract rights thereunder, except as provided in the
Consent and Agreement and the Engine Consent and Agreement, respectively or
(iii) require the Manufacturer to divest itself of title to or possession of the
Aircraft until delivery thereof and payment therefor as provided in the Purchase
Agreement.
(d) The parties hereto, and the Manufacturer and the Engine
Manufacturer by its respective execution and delivery of the Consent and
Agreement and the Engine Consent and Agreement, agree that all of the
statements, representations, covenants and agreements made by Buyer acting
through the Owner Trustee (when made in such capacity) contained in this
Assignment and any agreement referred to herein (other than the Trust
Agreement), unless expressly otherwise stated, are made and intended only for
the purpose of binding the Trust Estate and establishing the existence of rights
and remedies which can be exercised and enforced only against the Trust Estate.
Therefore, anything contained in this Assignment or such other agreements to the
contrary notwithstanding (except for any express provisions that Owner Trustee
is responsible for in its individual capacity), no recourse shall be had with
respect to this Assignment or such other agreements against the Owner Trustee in
its individual capacity (or against any institution or person which becomes a
successor trustee or co-trustee) or any officer, director, trustee, servant or
direct or indirect parent or controlling person or persons of any of
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Purchase Agreement Assignment]
them; provided, however, that this Section 6(d) shall not be construed to
prohibit any action or proceeding against the Owner Trustee in its individual
capacity for its own willful misconduct or grossly negligent conduct; and
provided, further, that nothing contained in this Section 6(d) shall be
construed to limit the exercise and enforcement in accordance with the terms of
this Assignment or such other agreements of rights and remedies against the
Trust Estate. The foregoing provisions of this Section 6(d) shall survive the
termination of this Assignment and the other Operative Agreements.
SECTION 7. Further Assignment. In order to secure the repayment of,
inter alia, the Certificates, Buyer has agreed in the Indenture, among other
things, to assign to the Indenture Trustee all of Buyer's right, title and
interest in and to the Purchase Agreement (as it relates to the Aircraft) and
this Assignment, and Seller hereby consents to such assignment.
SECTION 8. Further Assurances. Seller agrees that at any time and from
time to xxxx Xxxxxx shall promptly and duly execute and deliver any and all such
further instruments and documents and take such further action as Buyer may
reasonably request in writing in order to obtain the full benefits of this
Assignment and of the rights and powers herein granted. Seller shall provide a
Deferred Delivery Date Notice to the Manufacturer, the Engine Manufacturer and
the Indenture Trustee with respect to any proposed reassignment of the Purchase
Agreement and the Engine Warranties in connection with the sale of an Aircraft
by Buyer to Seller not less than five Business Days prior to such sale. Buyer
agrees, expressly for the benefit of Manufacturer and the Engine Manufacturer,
that at any time and from time to time upon the written request of Manufacturer
or the Engine Manufacturer, as the case may be, Buyer shall promptly and duly
execute and deliver any and all such further assurances, instruments and
documents and take all such further action as Manufacturer or the Engine
Manufacturer, as the case may be, may reasonably request in order to obtain the
full benefits of Buyer's agreements hereunder.
SECTION 9. No Amendment of Purchase Agreement or General Terms
Agreement. Buyer agrees that it will not enter into any amendment, modification,
supplement, rescission, cancellation or termination of the Purchase Agreement or
the General Terms Agreement without the prior written consent of Seller unless
the Indenture Trustee shall have notified Manufacturer and the Engine
Manufacturer that an Indenture Event of Default has occurred and is continuing.
SECTION 10. Nondisclosure. Seller and Buyer agree, expressly for the
benefit of the Manufacturer and the Engine Manufacturer, that they will not
disclose the terms of the Purchase Agreement or the General Terms Agreement to
any third party, except (a) as required by applicable laws or governmental
regulations, (b) with the prior written consent of the Manufacturer or the
Engine Manufacturer, as applicable, (c) to Indenture Trustee and the Loan
Participants and to potential transferees thereof and their respective counsel.
Any disclosure contemplated by clause (c) of the preceding sentence shall
include a requirement that the entity to whom such information is disclosed
shall be subject to obligations of nondisclosure with respect to such
information substantially the same as those contained herein.
SECTION 11. Miscellaneous.
(a) This Assignment shall be binding upon and shall inure to the
benefit of Seller, Buyer and their respective successors and permitted assigns.
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Purchase Agreement Assignment]
(b) Except as otherwise expressly provided herein, notice
hereunder may be given, and shall be deemed to have been received when given, as
provided in Section 7(e) of the Acquisition Agreement.
(c) This Assignment is being executed by Buyer and Seller
concurrently with the execution and delivery of the Indenture, the Acquisition
Agreement and the Trust Agreement.
(d) This Assignment may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute one and the same
instrument.
(e) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
(f) This Assignment is being delivered in the State of
New
York.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused this Purchase
Agreement Assignment to be duly executed the day and year first above written.
SOUTHWEST AIRLINES CO.,
as Seller
By: /s/ XXXXX XXXXXX
-----------------------------------
Name: XXXXX XXXXXX
Title: VP, FINANCE & TREASURER
THE AMOR TRUST,
by Wilmington Trust Company, not in its
individual capacity but solely as Owner
Trustee, as Buyer
By: /s/ W. XXXXX XXXXXXXXXX
-----------------------------------
Name: W. XXXXX XXXXXXXXXX
Title: VICE PRESIDENT
The undersigned, as Indenture Trustee and as assignee of, and holder of
a security interest in the estate, right, title and interest of Buyer in and to
the foregoing Purchase Agreement Assignment and the Purchase Agreement pursuant
to the terms of the Indenture, acknowledges the terms of the foregoing Purchase
Agreement Assignment and agrees that its rights and remedies under the Indenture
shall be subject to the terms and conditions of the foregoing Purchase Agreement
Assignment, including Section 6(b) therein, and of the Purchase Agreement.
XXXXX FARGO BANK NORTHWEST,
NATIONAL ASSOCIATION,
as Indenture Trustee
By: /s/ C. XXXXX XXXXXXX
----------------------------------
Name: C. XXXXX XXXXXXX
Title: VICE PRESIDENT
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[Purchase Agreement Assignment]
EXHIBIT A
CONSENT AND AGREEMENT
The undersigned, THE BOEING COMPANY, a Delaware corporation, hereby
acknowledges notice of, and consents to all of the terms of, the Purchase
Agreement Assignment dated as of November 13, 2001 by and between
SOUTHWEST
AIRLINES CO., a Texas corporation ("SELLER") and THE AMOR TRUST, acting through
the Owner Trustee ("BUYER") (herein called the "ASSIGNMENT"; the terms defined
therein or by reference herein being hereinafter used with the same meaning) as
it relates to the Manufacturer and the Aircraft and hereby confirms to Seller
and Buyer and agrees, that: (i) all representations, warranties, indemnities and
agreements of the Manufacturer under the Purchase Agreement with respect to the
Aircraft, to the extent assigned by Seller to Buyer, shall inure to the benefit
of Buyer to the same extent as if originally named the "Buyer" therein, subject
to the terms and conditions of the Assignment; (ii) the Manufacturer agrees that
the Assignment constitutes an agreement by Buyer as required by Article 10 of
the Purchase Agreement; (iii) the Manufacturer will continue to pay to Seller
all payments which the Manufacturer may be required to make in respect to the
Aircraft under the Purchase Agreement unless and until the Manufacturer shall
have received written notice from the Indenture Trustee by telex at telex number
32-9430, Answerback BOEINGREN RNTN, by telecopier at telecopier number (425)
237-1706 or addressed to its Vice President - Contracts at X.X. Xxx 0000, Mail
Code 21-34, Xxxxxxx, Xxxxxxxxxx 00000, that an Indenture Event of Default has
occurred and is continuing, whereupon the Manufacturer will not be required to
make further inquiry into the content of such notice and thereafter (until the
Manufacturer shall have received notice in writing from the Indenture Trustee
sent or addressed as aforesaid that no Indenture Event of Default exists or that
such Indenture Event of Default has been waived or cured) the Manufacturer shall
make any and all payments which it may be required to make in respect of the
Aircraft under the Purchase Agreement directly to the Indenture Trustee; (iv)
the Manufacturer agrees that it will not assert any lien or claim against the
Aircraft or any part thereof arising with respect to or in connection with any
work or other services performed by the Manufacturer or at its direction on the
Aircraft on or prior to the delivery of the Aircraft to Buyer; and (v) the
Manufacturer certifies that the information set forth on Schedule 1 of the
Assignment is true and correct as of the date of this Consent.
The Manufacturer hereby confirms to the Buyer and the Indenture Trustee
that:
(i) the Manufacturer consents to the assignment by Buyer to the
Indenture Trustee of Buyer's right, title and interest in and to the Aircraft,
the Purchase Agreement, the Assignment and this Consent and Agreement pursuant
to the Indenture, and the Manufacturer agrees that all such right, title and
interest of Buyer shall inure to benefit of the Indenture Trustee and any
permitted assignee thereof that becomes the owner of the Aircraft;
(ii) the Manufacturer agrees that Buyer may reassign Buyer's right,
title and interest in and to the Purchase Agreement to Seller at anytime without
the Manufacturer's consent; provided that Buyer and Seller shall provide to the
Manufacturer a Deferred Delivery Date Notice with respect to each Aircraft;
EXHIBIT A
Page 1
[Purchase Agreement Assignment]
(iii) upon receipt by the Manufacturer of a notice from the Indenture
Trustee addressed to the Manufacturer at the preceding address that an Indenture
Event of Default has occurred and is continuing, any rights reserved to Buyer or
Seller under the Assignment shall inure to the benefit of the Indenture Trustee;
and
(iv) except as provided in the attestation executed by the Indenture
Trustee on the signature page of the Assignment, neither the Indenture Trustee
nor any of the Loan Participants shall be liable for any of the obligations or
duties of Seller under the Purchase Agreement or of Buyer under the Assignment,
nor shall the Indenture give rise to any duties or obligations whatsoever on the
part of the Indenture Trustee or any Loan Participant owing to the Manufacturer.
The Manufacturer hereby represents and warrants that (A) the
Manufacturer is a corporation duly organized and existing in good standing under
the laws of the State of Delaware, (B) the making and performance of the
Purchase Agreement and this Consent and Agreement have been duly authorized by
all necessary corporate action on the part of the Manufacturer, do not require
any stockholder or other approval, do not contravene the Manufacturer's Restated
Certificate of Incorporation or By-laws or any indenture, credit agreement or
other contractual agreement to which the Manufacturer is a party or by which it
is bound, and the making of the Purchase Agreement and this Consent and
Agreement does not contravene, and to the best of the Manufacturer's knowledge,
the Manufacturer's performance of this Consent and Agreement, does not
contravene, any law binding on the Manufacturer, and (C) each of the Purchase
Agreement and this Consent and Agreement constitutes a binding obligation of the
Manufacturer enforceable against the Manufacturer in accordance with its
respective terms, subject to (a) applicable bankruptcy, insolvency, moratorium
and other similar laws affecting the enforcement of creditors' rights generally
and (b) general principles of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law).
* * *
EXHIBIT A
Page 2
[Purchase Agreement Assignment]
This Consent and Agreement shall be governed by and construed in
accordance with the internal laws of the State of Washington, including all
matters of construction, validity and performance excluding those principles
relating to its conflict of laws.
Dated: November __, 2001
THE BOEING COMPANY
By:
----------------------------
Name:
Title:
Southwest Airlines Co.
MSN Nos. 27896, 27897, 29836, 29818,
29819, 29820, 29821, 29822, 29823, 29824,
29825, 29826, 29827, 29828, 29829, 29830,
29831, 32452 and 32453
EXHIBIT A
Page 3
[Purchase Agreement Assignment]
EXHIBIT B
ENGINE CONSENT AND AGREEMENT
The undersigned, CFM INTERNATIONAL, INC., a Delaware corporation (the
"ENGINE MANUFACTURER") hereby acknowledges notice of and consents to all of the
terms of the Purchase Agreement Assignment dated as of November 13, 2001 (the
"ASSIGNMENT") between
Southwest Airlines Co., as seller and The Amor Trust, as
buyer in respect of thirty-eight (38) CFM International Model CFM56-7B engines
installed or to be installed on nineteen (19) Boeing model 737-7H4 aircraft as
more particularly described in the Assignment to the extent applicable to the
Engine Manufacturer.
The Engine Manufacturer hereby confirms to Buyer, Seller and the
Indenture Trustee that (i) the Engine Warranties under the General Terms
Agreement, to the extent the same relate to the Engines, shall inure to the
benefit of (x) Buyer to the same extent as if originally named the "Airline" in
the General Terms Agreement, (y) the Indenture Trustee (as assignee of Buyer
under the Indenture) and (z) Seller (but only to the extent provided in the
Assignment), in each case subject to the terms of the Assignment; provided
always that notwithstanding any provision to the contrary, nothing contained in
this Engine Consent and Agreement or in the Assignment shall subject the Engine
Manufacturer to any liability or obligation under the Engine Warranties to which
it would not otherwise be subject under the General Terms Agreement, (ii) the
Engine Manufacturer will continue to pay to Seller all payments which the Engine
Manufacturer may be required to make in respect to the Engine Warranties unless
and until the Engine Manufacturer shall have received written notice from the
Indenture Trustee by mail to the Director of Commercial Contracts at 0 Xxxxxx
Xxx, Xxxxxxxxxx Xxxx 00000, or by telecopier to (000) 000-0000, that an
Indenture Event of Default has occurred and is continuing, whereupon the Engine
Manufacturer will not be required to make further inquiry into the content of
such notice and thereafter (until the Engine Manufacturer shall have received
notice in writing from the Indenture Trustee sent or addressed as aforesaid that
no Indenture Event of Default exists or that such Indenture Event of Default has
been waived or cured) the Engine Manufacturer shall make any and all payments
which it may be required to make in respect of the Engine Warranties directly to
the Indenture Trustee; (iii) the Engine Manufacturer consents to the assignment
by Buyer to the Indenture Trustee of Buyer's right, title and interest in and to
the Engine Warranties, the Assignment and this Engine Consent and Agreement
pursuant to the Indenture, and the Engine Manufacturer agrees that all such
right, title and interest of Buyer shall inure to benefit of the Indenture
Trustee and any assignee thereof that becomes the owner of the Aircraft; (iv)
the Engine Manufacturer agrees that Buyer may reassign Buyer's right, title and
interest in and to the Engine Warranties to Seller at anytime without the Engine
Manufacturer's consent; (v) upon receipt by the Engine Manufacturer of a notice
from the Indenture Trustee addressed to the Engine Manufacturer at the preceding
address that an Indenture Event of Default has occurred and is continuing, any
rights reserved to Buyer or Seller under the Assignment shall inure to the
benefit of the Indenture Trustee; and (vi) except as provided in the attestation
executed by the Indenture Trustee on the signature page of the Assignment,
neither the Indenture Trustee nor any of the Loan Participants shall be liable
for any of the obligations or duties of Seller under the General Terms Agreement
or of Buyer under the Assignment, nor shall the Indenture give rise to any
duties or obligations whatsoever on the part of the Indenture Trustee or any
Loan Participant owing to the Engine Manufacturer.
EXHIBIT B
Page 1
[Purchase Agreement Assignment]
The Engine Manufacturer hereby represents and warrants that (A) the
Manufacturer is a corporation duly organized and existing in good standing under
the laws of the State of Delaware, (B) the making and performance of the Engine
Warranties and this Engine Consent and Agreement have been duly authorized by
all necessary corporate action on the part of the Engine Manufacturer, do not
require any stockholder or other approval, do not contravene its Certificate of
Incorporation or By-laws or any indenture, credit agreement or other contractual
agreement to which the Engine Manufacturer is a party or by which it is bound,
and the making of the Engine Warranties and this Engine Consent and Agreement
does not contravene, and to the best of the Engine Manufacturer's knowledge, the
Engine Manufacturer's performance of this Engine Consent and Agreement, does not
contravene, any law binding on the Engine Manufacturer, and (C) each of the
Engine Warranties and this Engine Consent and Agreement constitutes a binding
obligation of the Engine Manufacturer enforceable against the Engine
Manufacturer in accordance with its respective terms, subject to (a) applicable
bankruptcy, insolvency, moratorium and other similar laws affecting the
enforcement of creditors' rights generally and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) .
Words and expressions defined in the Assignment shall have the same
respective meanings when used herein.
The Engine Consent and Agreement is governed by and shall be construed
in accordance with the laws of the State of
New York, U.S.A., without reference
to its conflict of laws provisions.
CFM INTERNATIONAL, INC.
By:
------------------------------
Name:
Title:
Date: November __, 2001
EXHIBIT B
Page 2
[Purchase Agreement Assignment]
EXHIBIT C
DEFERRED DELIVERY DATE NOTICE
To: The Boeing Company
CFM International, Inc.
Xxxxx Fargo Bank Northwest,
National Association, as Indenture Trustee
Date: , 200
--------------- --
Ladies and Gentlemen:
Reference is hereby made to the (i) the Trust Indenture and Security
Agreement dated as of November 13, 2001 (the "INDENTURE") among The Amor Trust,
acting through the Owner Trustee (the "TRUST"), Wilmington Trust Company, not in
its individual capacity, except as expressly set forth therein, but solely in
its capacity as owner trustee of the Trust (the "OWNER TRUSTEE") and Xxxxx Fargo
Bank Northwest, National Association, not in its individual capacity, except as
expressly set forth therein, but solely in its capacity as indenture trustee
(the "INDENTURE TRUSTEE"), (ii) the Aircraft Acquisition and Sale Agreement
dated as of November 13, 2001 (the "ACQUISITION AGREEMENT") among the Trust, the
Owner Trustee, the Indenture Trustee and
Southwest Airlines Co. ("SOUTHWEST"),
(iii) the Purchase Agreement No. 1810 dated as of January 19, 1994 (the
"PURCHASE AGREEMENT") between The Boeing Company (the "MANUFACTURER") and
Southwest, and (iv) the Purchase Agreement Assignment dated as of November 13,
2001 (the "ASSIGNMENT") between the Trust and Southwest. Capitalized terms used
herein and not otherwise defined herein shall have the meanings set forth in the
Assignment, including terms defined therein by reference to any other agreement.
The Trust and Southwest hereby give you notice that on ____________,
200__ (the "DEFERRED DELIVERY Date"), the Trust will sell to Southwest all of
its right, title and interest in and to one Boeing model 737-7H4 aircraft
bearing manufacturer's serial number _____, together with two installed CFM
International model CFM56-7B engines bearing manufacturer's serial numbers _____
and _____ (the "AIRCRAFT"), and Seller will assign to Southwest all of its right
title and interest in and to the Purchase Agreement and the Engine Warranties to
the extent relating to the Aircraft.
The Trust hereby confirms for the benefit of the Manufacturer that it
owns and controls the rights it purports to assign hereunder and that it will
remain responsible for any payments due to the Manufacturer as a result of
obligations relating to the Aircraft incurred by the Trust to the Manufacturer
prior to said Deferred Delivery Date.
Southwest acknowledges it has reviewed the Purchase Agreement and
agrees that in exercising any rights under the Purchase Agreement or asserting
any claims with respect to the Aircraft (including, without limitation, data,
documents, training and services) it shall be bound by and will comply with all
applicable terms, conditions and limitations of the Purchase
EXHIBIT C
Page 1
[Purchase Agreement Assignment]
Agreement, including, without limitation, those related to any exclusion or
limitation of liabilities or warranties, indemnity and insurance.
We request that the Manufacturer acknowledge receipt of this
notice and confirm the transfer of rights set forth above by signing the
acknowledgment and forwarding one copy of this notice to each of the
undersigned.
THE AMOR TRUST, by
SOUTHWEST AIRLINES CO.,
Wilmington Trust Company, not in its as Seller
individual capacity, but solely as Owner
Trustee
By: By:
----------------------------------- ----------------------
Its: Its:
Receipt of the above letter is acknowledged
and transfer of rights under the Purchase
Agreement described above with respect to the
Aircraft is confirmed, effective as of this date.
THE BOEING COMPANY
By:
----------------------------
Its:
Dated:
-------------------------
MSN
-------------
EXHIBIT C
Page 2
[Purchase Agreement Assignment]
SCHEDULE 1
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SCHEDULE 1
Page 1
