Supplemental Agreement No.78

EX-10.1 12 ex10_1.htm EXHIBIT 10.1 SA-78 ex10_1.htm

Supplemental Agreement No. 78
 
to
 
Purchase Agreement No. 1810
 
between
 
THE BOEING COMPANY
 
and
 
SOUTHWEST AIRLINES CO.
 
Relating to Boeing Model 737-7H4 and 737-8H4 Aircraft


THIS SUPPLEMENTAL AGREEMENT, entered into as of  August 7   , 2012, by and between THE BOEING COMPANY, a Delaware corporation with principal offices in Seattle, Washington, (Boeing) and SOUTHWEST AIRLINES CO., a Texas corporation with principal offices in Dallas, Texas (Buyer);

Buyer and Boeing entered into Purchase Agreement No. 1810 dated January 19, 1994 as amended, and supplemented, (Purchase Agreement) relating to the purchase and sale of Boeing Model 737-7H4 aircraft (737-7H4 Aircraft) and 737-8H4 aircraft (737-8H4 Aircraft); and this Supplemental Agreement is an amendment to and is incorporated into the Purchase Agreement:

WHEREAS, Buyer and Boeing agree to accelerate the delivery month of one (1) 737-8H4 Aircraft bearing Manufacturing Serial Number 36891 from January 2013 to December 2012 (Accelerated Aircraft).

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties agree to amend the Purchase Agreement as follows:

1. The Table of Contents of the Purchase Agreement is deleted in its entirety and a new Table of Contents is attached hereto and incorporated into the Purchase Agreement by this reference.

2. Table 1b, “Aircraft Information Table – Block 800LUV Aircraft,” is deleted in its entirety and a new Table 1b is attached hereto and incorporated into the Purchase Agreement by this reference.  The new Table 1b reflects the revised delivery month for the Accelerated Aircraft.

3. Letter Agreement SWA-PA-1810-LA-1105888, *** is deleted in its entirety and replaced with a revised Letter Agreement No. SWA-PA-1810-LA-1105888R1, attached hereto and incorporated in the Purchase Agreement by this reference.

***Pursuant to 17 CFR 240.24b-2, confidential information has been omitted and has been filed separately with the Securities and Exchange Commission pursuant to a Confidential Treatment Application filed with the Commission.
 
 

 
P.A. No. 1810
SA-78-1

 
 
 



4. As a result of the execution of this Supplemental Agreement, there is an excess in Advance Payments made by Buyer to Boeing in the amount of ***.   Boeing will retain such excess amount until the next Advance Payment is due, at which time Buyer may reduce the amount of such Advance Payment by the amount of such excess.


The Purchase Agreement will be deemed to be supplemented to the extent herein provided and as so supplemented will continue in full force and effect.


EXECUTED IN DUPLICATE as of the day and year first above written.

THE BOEING COMPANY
  
SOUTHWEST AIRLINES CO.
     
By: /s/ Cheri A. Fischer
  
By: /s/ Laura Wright
     
Its: Attorney-In-Fact
  
Its:  Sr VP Finance & CFO

 
 

 
P.A. No. 1810
SA-78-2

 
 
 
TABLE OF CONTENTS
   
Page
SA
   
Number
Number
                           ARTICLES


1.
Subject Matter of Sale
1-1
SA-75
       
2.
Delivery, Title and Risk
of Loss
 
2-1
 
SA-28
       
3.
Price of Aircraft
3-1
SA-75
       
4.
Taxes
4-1
  
       
5.
Payment
5-1
  
       
6.
Excusable Delay
6-1
  
       
7.
Changes to the Detail
Specification
 
7-1
 
SA-73
       
8.
Federal Aviation Requirements and
Certificates and Export License
 
8-1
  
       
9.
Representatives, Inspection,
Flights and Test Data
 
9-1
  
       
       
10.
Assignment, Resale or Lease
10-1
  
       
11.
Termination for Certain Events
11-1
  
       
12.
Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance
 
 
 
12-1
  
       
13.
Buyer Furnished Equipment and
Spare Parts
 
13-1
  
       
14.
Contractual Notices and Requests
14-1
  
       
15.
Miscellaneous
15-1
  



P.A. No. 1810
i
SA-78
K/SWA
    
 
 
 
 
                   
TABLE OF CONTENTS
 
        SA
Number
 
                           TABLE
 
1.
Aircraft Information Table
SA-75
1a Aircraft Information Table - Block 700LUV Aircraft    SA-77
1b
Aircraft Information Table - Block 800LUV Aircraft
SA-78      
 
                                    EXHIBITS
 
 
A-4
Aircraft Configuration- 737-700 Block T-W-2b Aircraft
SA-66
      
A-5
Aircraft Configuration - Block 700LUV Aircraft
SA-75    
 
  
 
A-6 Aircraft Configuration - Block 700LUV Aircraft    SA-75
 
  
  
B 
***
SA-75
       
C
Customer Support Document   
    
 
  
 
C-2 737-800 Customer Support Document SA-75
 
  
    
D 
Price Adjustment Due to
Economic Fluctuations - Aircraft Price Adjustment
(July 1992 Base Price)
 
      
D-1
Price Adjustment Due to
Economic Fluctuations - Aircraft Price Adjustment
(July 1999 Base Price)
SA-13
 
  
 
D-2
Economic Price Adjustment
ECI-MFG/CPI (July 2011 Base Price) 
 SA-75
 
  
   
E
Buyer Furnished Equipment
Provisions Document
Attachment A - 737-7H4 Aircraft (through 2012)
Attachment B - 737-8H4 Aircraft (2012-2018)
SA-75
 
 
SA-77
     
F
Defined Terms Document
 
 

                                   LETTER AGREEMENTS
 
1810-1R1
Waiver of Aircraft Demonstration Flight
SA-75
 
 
 
P.A. No. 1810
ii
SA-78
K/SWA
    
 
 
 
TABLE OF CONTENTS
 
        SA
Number
 
                            RESTRICTED LETTER AGREEMENTS

6-1162-RLL-932R3
***
SA-75
     
6-1162-RLL-934R5
Disclosure of Confidential
SA-75
 
Information
  
     
6-1162-NIW-890R1
***
SA-75
 
 
 
SA-39
     
6-1162-RLL-941R3
Other Matters
SA-75
     
6-1162-KJJ-054R2
Business Matters
SA-75
 
(Not applicable to Block 700LUV & Block 800LUV Aircraft)
     
6-1162-KJJ-055R1
Structural Matters
SA-25
     
6-1162-KJJ-056
Noise and Emission Matters
SA-13
     
6-1162-KJJ-057
Product Development Matters
SA-13
     
6-1162-JMG-669R9
***
SA-75
   
   
SA-75
   
SA-54
 
SWA-PA-1810-LA-1001315R1
***
SA-75
 
Attachment A
SA-77
     
SWA-PA-1810-LA-02710
***
SA-72
 
     
SWA-PA-1810-LA-1003498 R1
***
SA-75
     
SWA-PA-1810-LA-1003490R1
***
SA-75
     
SWA-PA-1810-LA-1003367R1
***
SA-75
     
SWA-PA-1810-LA-1105883
Aircraft Model Substitution
SA-75
     
SWA-PA-1810-LA-1105884
Option Aircraft
SA-75
 
Attachment  – Option Aircraft Information Table
 
 
P.A. No. 1810
iii
SA-78
K/SWA
    

 
 
 
 
TABLE OF CONTENTS
 
        SA
Number
 
SWA-PA-1810-LA-1105885
***
SA-75
     
SWA-PA-1810-LA-1105886
***
SA-75
     
     
SWA-PA-1810-LA-1105887
***
SA-75
     
     
SWA-PA-1810-LA-1105888
***
SA-78
     
SWA-PA-1810-LA-1105889
***
SA-75
 
 

ADDITIONAL LETTERS (FOR REFERENCE)
6-1162-MSA-288
Business Offer – Enhanced Ground Proximity
 
Warning System (EGPWS) – Activiation – Peaks
 
and Obstacles Feature
 
(Not applicable to Block 700LUV & Block 800LUV Aircraft)
   
6-1162-JMG-501R2
Business Offer – ACARS package
 
(Not applicable to Block 700LUV & Block 800LUV Aircraft)
      
                                    INACTIVE / DELETED TABLES, EXHIBITS, AND LETTER AGREEMENTS
 

                                    TABLE
 

Table
Title
Last Updated under SA
Current Status
2
Option Aircraft Information Table
SA-74
Deleted under SA-75

                                    EXHIBITS

Exhibits
Title
Last Updated under SA
Current Status
A
Aircraft Configuration – 737-700
SA-36
Inactive
A-Winglet
Aircraft Configuration
SA-36
Inactive
A-1-Winglet
Aircraft Configuration
SA-36
Inactive
A-1A
Aircraft Configuration - 737-700 Block T-W-2c
SA-36
Inactive
 
P.A. No. 1810
iv
SA-78
K/SWA
    

 
 

 
 
TABLE OF CONTENTS


Exhibits
Title
Last Updated
Under SA
Current Status
A-2
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
SA-47
Inactive
A-3
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
SA-61
Inactive
C.2
737-800 Customer Support Variables
SA-71
Deleted under SA-75
E.2
737-800 Buyer Furnished Equipment Provisions Document
SA-73
Deleted under SA-75
 
 
                                    RESTRICTED LETTER AGREEMENTS

Letter Agreement
Title
Last Updated under SA
Current Status
6-1162-RLL-933R21
Option Aircraft
SA-60
Deleted under SA-75
6-1162-RLL-935R1
Performance Guarantees
SA-1
Inactive
6-1162-RLL-936R4
Certain Contractual Matters
SA-4
Inactive
6-1162-RLL-937
Alternate Advance Payment Schedule
  
Inactive
6-1162-RLL-938
***
  
Inactive
6-1162-RLL-939R1
Certification Flight Test Aircraft
SA-1
Inactive
6-1162-RLL-940R1
Training Matters
SA-1
Inactive
6-1162-RLL-942
Open Configuration Matters
  
Inactive
6-1162-RLL-943R1
Substitution Rights
SA-6
Deleted under SA 75
6-1162-RLL-944
***
  
Inactive
6-1162-RLL-945
Comparison of 737-7H4 and 737-3H4 Block Fuel Burn
  
Inactive
6-1162-RLL-1855R3
Additional Contractual Matters
SA-4
Inactive
6-1162-RLL-1856
***
SA-1
Inactive
6-1162-RLL-1857
Service Ready Validation Program Field Test
SA-1
Inactive
6-1162-RLL-1858R1
Escalation Matters
SA-4
Inactive
6-1162-RLL-2036
Amortization of Costs for Customer Unique Changes
SA-1
Inactive
6-1162-RLL-2037
Reconciliation of the Aircraft Basic Price
SA-1
Inactive
 
 
P.A. No. 1810
v
SA-78
K/SWA
    

  
 
 
 
TABLE OF CONTENTS


Letter Agreement
Title
Last Updated
Under SA
Current Status
6-1162-RLL-2073
Maintenance Training Matters
SA-1
Inactive
6-1162-KJJ-058R1
Additional Substitution Rights
SA-71
Deleted under SA-75
6-1162-KJJ-150
Flight Control Computer & Mode Control Panel Spares Matter
SA-14
Inactive
6-1162-MSA-185R3
Delivery Change Contractual Matters
SA-21
Inactive
6-1162-JMG-747R1
***
SA-36
Inactive
6-1162-CHL-217
Rescheduled Flight Test Aircraft
SA-32
Inactive
6-1162-NIW-606R1
***
SA-36
Inactive
6-1162-NIW-640
Early Delivery of Two April 2004  Aircraft
SA-35
Inactive
6-1162-NIW-889
Warranty - Exterior Color Schemes and Markings for YA143 and on
SA-39
Inactive
6-1162-NIW-1142
***
SA-43
Inactive
6-1162-NIW-1369
***
SA-46
Inactive
6-1162-NIW-1983
***
SA-62
Inactive
SWA-PA-1810-LA-1000419
***
SA-64
Inactive



P.A. No. 1810
vi
SA-78
K/SWA
    
 
 
 
 
Table 1b to
Purchase Agreement No. PA-01810
Aircraft Delivery, Description, Price and Advance Payments
Block 800LUV Aircraft


Airframe Model/MTOW:
737-800
174200 pounds
  
Detail Specification:
        D019A001SWA38P-1 Rev New
           
Engine Model/Thrust:
CFM56-7B26
26400 pounds
  
Airframe Base Aircraft Price Base Year/Escalation Formul
Jul-11
ECI-MFG/CPI

Base Aircraft Price:
***
  
Engine Price Base Year/Escalation Formula:
N/A    
         N/A
           
Special Features:
***
Notes 1 & 2
      
           
Sub-Total of Aircraft  Base Price and Features:
***
  
Aircraft Price Escalation Data:
    
           
Engine Price (Per Aircraft):
***
  
Base Year Index (ECI):
 
       ***
           
Aircraft Basic Price (Excluding BFE/SPE):
***
  
Base Year Index (CPI):
 
       ***
           
Buyer Furnished Equipment (BFE) Estimate:
***
        
           
Seller Purchased Equipment (SPE) Estimate:
***
        
           

 
Delivery
Date
Number of
Aircraft
Escalation Factor
(Airframe)
Aircraft
Serial
Number
  
Escalation Estimate
Adv Payment Base
Price Per A/P
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
At Signing
***
24 Mos.
***
21/18/12/9/6 Mos.
***
Total
***
Mar-2012
1
***
36980
Note 1 & 3
***
***
***
***
***
Mar-2012
1
***
36680
Note 2 & 3
***
***
***
***
***
Apr-2012
3
***
36681, 36983, 36683
Note 3
***
***
***
***
***
May-2012
3
***
36682, 36985, 36987
Note 3
***
***
***
***
***
Jun-2012
4
***
38807, 38808, 38809, 38810
Note 3
***
***
***
***
***
Jul-2012
3
***
36684, 36990, 38811
Note 3
***
***
***
***
***
Aug-2012
2
***
36685, 36992
Note 3
***
***
***
***
***
Sep-2012
2
***
36686, 36994
Note 3
***
***
***
***
***
Oct-2012
2
***
36687, 36997
Note 3
***
***
***
***
***
Nov-2012
4
***
37005, 37003, 35969, 35966
Note 3
***
***
***
***
***
Dec-2012
3
***
37006, 37009, 38818,
Note 3
***
***
***
***
***
Dec-2012
1
***
36891
  
***
***
***
***
***
Jan-2013
3
***
35964, 36638, 36634
  
***
***
***
***
***
Feb-2013
2
***
36635, 36893
  
***
***
***
***
***
Mar-2013
2
***
36892, 36973
  
***
***
***
***
***
Apr-2013
2
***
36908, 36998
  
***
***
***
***
***
Sep-2013
1
***
36933
  
***
***
***
***
***
Oct-2013
2
***
36912, 36914
  
***
***
***
***
***
Nov-2013
3
***
36915, 33939, 42526
  
***
***
            ***
                         ***
  ***
 

 
SWA-PA01810
  
Page 1 
57774, 57776, 57777, 60261-1F.TXT
                     Boeing Proprietary
SA-78

 
 
 
Table 1b to
Purchase Agreement No. PA-01810
Aircraft Delivery, Description, Price and Advance Payments
Block 800LUV Aircraft


Delivery
Date
Number of
Aircraft
Escalation Factor
(Airframe)
Aircraft
Serial
Number
  
Escalation Estimate
Adv Payment Base
Price Per A/P
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
At Signing
***
24 Mos.
***
21/18/12/9/6 Mos.
***
Total
***
Dec-2013
5
***
36917, 36919, 36731, 42529, 42530
  
***
***
***
***
***
Mar-2014
1
***
37004
Note 4
***
***
***
***
***
Apr-2014
4
***
42384, 36894, 36895, 36896
Note 4
***
***
***
***
***
May-2014
3
***
36897, 42385, 42521
Note 4
***
***
***
***
***
Jun-2014
3
***
36898, 36905, 42522
Note 4
***
***
***
***
***
Jul-2014
2
***
42523, 36911
Note 4
***
***
***
***
***
Aug-2014
4
***
36907, 42524,35973, 42525
Note 4
***
***
***
***
***
Sep-2014
4
***
36935, 42528, 42527, 42531
Note 4
***
***
***
***
***
Oct-2014
3
***
36909, 36732, 36920
Note 4
***
***
***
***
***
Total:
73
                

Notes:
1)  ***
2)  ***
3)  ***
4) The Advance Payment Base Price is determined using the escalation factor from Boeing's 4th Qtr 2011 forecast.




SWA-PA01810
  
Page 2 
57774, 57776, 57777, 60261-1F.TXT
                        Boeing Proprietary
SA-78

 
 
 

BOEING
 
                        The Boeing Company
                        P.O. Box 3707
                        Seattle, WA  98124-2207
 


SWA-PA-1810-LA-1105888R1


Southwest Airlines Co.
2702 Love Field Drive
P.O. Box 36611
Dallas, Texas 75235


Subject:
***

Reference:
a)
Purchase Agreement No. 1810 (Purchase Agreement) between The Boeing Company (Boeing) and Southwest Airlines Co. (Buyer) relating to Model 737-7H4 and 737-8H4 aircraft


 
This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement.  All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.
 
              ***

 
1.           ***
 
 

 
SWA-PA-1810-LA-1105888R1 
Page  1
***
SA-78
BOEING PROPRIETARY

 
 
 

BOEING
 
 

 
2.   Termination of Agreements relating to Large Area Display System.  Boeing and Buyer hereby terminate all agreements relating to the installation of large area display systems on Buyer’s 737-300/-500 aircraft in Buyer’s fleet (LADS Project).  *** Boeing and Buyer hereby agree that neither party shall have any further obligations with respect to the LADS Project.
 

 
3.   ***
 
 

 
SWA-PA-1810-LA-1105888R1 
Page 2 
***
                        SA-78
BOEING PROPRIETARY

 
 
 
BOEING

 
*** Aircraft by MSN
36717
33943
34861
33925
33923
36724
36718
33917
33929
34479
36399
34862
33927
35110
33928
33918
35109
33930
35788
33931
36091
33921
33926
33922
33919
36725
33934
33933
33924
36716

 
4.   Assignment.
 
 
The business terms described in this Letter Agreement are provided *** in consideration of Buyer’s taking title to the Firm Aircraft and Option Aircraft at time of delivery and becoming the operator of the Firm Aircraft and Option Aircraft.  Under no circumstances will Buyer be permitted to assign the business terms set forth herein.
 

 
5.   Confidentiality
 
Buyer understands that certain commercial and financial information contained in this Letter Agreement is considered by Boeing as confidential and has value precisely because it is not available generally to other parties.  Buyer agrees to limit the disclosure of the contents of this Letter Agreement to (a) its directors and officers, (b) employees of Buyer with a need to know the contents for performing its obligations (including, without limitation, those employees performing accounting, finance, administration and other functions necessary to finance and purchase, deliver or lease the Aircraft) and who understand they are not to disclose its contents to any other person or entity (other than those to whom disclosure is permitted by this paragraph) without the prior written consent of Boeing and (c) any auditors and attorneys of Buyer who have a need to know such information and have signed a confidentiality agreement in the same form and substance similar to this paragraph, or are otherwise bound by a confidentiality obligation. Disclosure to other parties is not permitted without Boeing’s consent except as may be required by applicable law or governmental regulations. Buyer shall be fully responsible to Boeing for compliance with such obligations.
 

 
SWA-PA-1810-LA-1105888R1 
Page 3
***
SA-78
BOEING PROPRIETARY

 
 
 
BOEING




Very truly yours,

THE BOEING COMPANY
 
By
/s/ Cheri A. Fischer
 
Its
Attorney-In-Fact
 
ACCEPTED AND AGREED TO this
 
Date:
August 7,  2012
 
SOUTHWEST AIRLINES CO.
 
By
/s/ Laura Wright
 
Laura Wright
 
Its
Sr VP Finance & CFO

 

 
SWA-PA-1810-LA-1105888R1 
Page  4
***
SA-78
BOEING PROPRIETARY