<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF SECURITIES EXCHANGE ACT OF 1934
For the quarter ended December 31, 1996
Commission File Number 0-15495
MESA AIR GROUP, INC.
----------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 85-0302351
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3753 Howard Hughes Parkway, Suite 200, Las Vegas 89109
- ------------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (702) 892-3773
---------------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
___ ___
On February 12, 1997 the Registrant had outstanding 28,259,715 shares of Common
Stock.
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PART I. FINANCIAL INFORMATION
Item 1.
MESA AIR GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended December 31
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
1996 1995
--------- ---------
<S> <C> <C>
Operating revenues:
Passenger $ 118,876 $ 116,928
Freight and other 1,701 1,910
Public service 835 1,191
--------- ---------
Total operating revenues 121,412 120,029
Operating expenses:
Flight operations 41,978 44,564
Maintenance 21,293 19,424
Aircraft and traffic servicing 20,398 17,088
Promotion and sales 17,592 18,116
General and administrative 6,958 7,522
Depreciation and amortization 8,543 5,713
--------- ---------
Total operating expenses 116,762 112,427
Operating income 4,650 7,602
--------- ---------
Non-operating income (expenses):
Interest expense (6,696) (1,621)
Interest income 542 645
Other 73 (317)
--------- ---------
Total non-operating income (expenses) (6,081) (1,293)
Earnings (loss) before income tax expense (benefit) (1,431) 6,309
Income tax expense (benefit) (556) 2,435
--------- ---------
Net earnings (loss) $ (875) $ 3,874
========= =========
Average common and common equivalent shares outstanding 28,442 33,679
========= =========
Earnings per common and common equivalent shares outstanding:
Net earnings (loss) $ (0.03) $ 0.12
========= =========
</TABLE>
2
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MESA AIR GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share amounts)
<TABLE>
<CAPTION>
December 31 September 30
1996 1996
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 55,095 $ 54,720
Marketable securities 6,199 5,300
Receivables, principally traffic 42,384 41,105
Expendable parts and supplies, net 25,941 26,956
Prepaid expenses and other current assets 10,582 6,394
-------- --------
Total current assets 140,201 134,475
Property and equipment, net 472,450 446,727
Lease and equipment deposits 10,677 10,889
Intangibles, net 52,247 53,538
Other assets 26,169 27,316
-------- --------
Total assets $701,744 $672,945
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt and capital leases $ 18,391 $ 17,127
Accounts payable 19,828 13,811
Income taxes payable 3,443 3,708
Air traffic liability 4,970 4,789
Accrued compensation 2,090 5,010
Other accrued expenses 14,462 19,170
-------- --------
Total current liabilities 63,184 63,615
Long-term debt and capital leases, excluding current portion 364,995 338,278
Deferred credits 24,405 23,992
Deferred income taxes 23,067 22,394
Stockholders' equity:
Preferred stock of no par value, 2,000,000 shares
authorized; no shares issued and outstanding -- --
Common stock of no par value, 75,000,000 shares authorized;
28,259,715 and 28,243,382 shares issued and outstanding 101,346 100,876
Retained earnings 120,408 121,283
Unrealized gain on marketable securities, net 4,339 2,507
-------- --------
Total stockholders' equity 226,093 224,666
-------- --------
Total liabilities and stockholders' equity $701,744 $672,945
======== ========
</TABLE>
3
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MESA AIR GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended December 31
<TABLE>
<CAPTION>
1996 1995
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss) $ (875) $ 3,874
Adjustments to reconcile net earnings (loss) to
net cash flows from operating activities:
Depreciation and amortization 8,543 5,713
Amortization of deferred credits (458) (655)
Stock bonus plan 348 441
Changes in assets and liabilities:
Receivables (1,278) 711
Expendable parts and supplies 1,015 1,068
Prepaid expenses and other current assets (4,188) 1,579
Accounts payable 6,016 (5,775)
Other accrued liabilities (5,212) (1,601)
-------- --------
NET CASH FLOWS FROM OPERATING ACTIVITIES 3,911 5,355
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (2,090) (7,694)
Proceeds from sale of property and equipment 1,438 6,042
Proceeds from sale of marketable securities 1,000 --
Other assets 1,147 500
Lease and equipment deposits (900) 2,572
-------- --------
NET CASH FLOWS FROM INVESTING ACTIVITIES 595 1,420
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term debt and obligations
under capital leases (4,662) (7,168)
Proceeds from issuance of common stock 122 48
Stock repurchase program -- (5,970)
Proceeds from deferred credits 409 225
-------- --------
NET CASH FLOWS FROM FINANCING ACTIVITIES (4,131) (12,865)
NET CHANGE IN CASH AND CASH EQUIVALENTS 375 (6,090)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 54,720 53,675
-------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 55,095 $ 47,585
======== ========
</TABLE>
4
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MESA AIR GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended December 31
Supplemental disclosures of cash flow information:
<TABLE>
<CAPTION>
1996 1995
------ ------
<S> <C> <C>
Cash paid during the period for:
Interest $6,538 $1,621
Income taxes 78 1,752
</TABLE>
Mesa purchased property and equipment upon which debt was assumed or incurred
totaling approximately $37 million during the first quarter ending December 31,
1996. Mesa did not purchase any property or equipment upon which debt was
assumed during the quarter ended December 31, 1995.
5
<PAGE> 6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three-month period ended December 31, 1996 are not
necessarily indicative of the results that may be expected for the year
ending September 30, 1997.
These financial statements should be read in conjunction with the
Company's consolidated financial statements and footnotes included in the
annual report.
2. The consolidated financial statements include the accounts of Mesa Air
Group, Inc. and its wholly owned subsidiaries Mesa Airlines, Inc., WestAir
Holding, Inc., Air Midwest, Inc., MPD, Inc., and FCA, Inc. All significant
intercompany balances and transactions have been eliminated in
consolidation.
3. Income tax expense (benefit) is based upon Mesa's annual effective tax
rate of 38.6 percent.
4. Legal Proceedings:
See Part II. Item 1.
6
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Item 2.
MESA AIR GROUP, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
GENERAL
Mesa Air Group, Inc. (collectively referred to herein as "Mesa") is the largest
independently owned regional airline in the world (based upon passenger
enplanements), serving 164 cities in 30 states and the District of Columbia.
Mesa operates a fleet of 183 aircraft as America West Express, Mesa Airlines,
United Express and USAir Express.
Mesa's business strategy is to achieve sustained, profitable growth by
utilizing focused operating strategies to service routes not generally served
by major air carriers. Mesa implements its strategy by carefully evaluating
market demand on the routes it serves and utilizes its fleet of aircraft to
meet that demand. In addition, Mesa is able to expand the markets it serves
under existing code-sharing agreements with certain of the major air carriers
to benefit from the name recognition, reservation systems and marketing and
promotional efforts of these carriers. Mesa operates a fleet of new and
efficient aircraft and performs most maintenance and overhaul work at its own
facilities. Mesa seeks to maximize gross revenues by managing fares and flight
schedules to increase yields and by developing new markets.
The following tables set forth year-to-year comparisons for the periods
indicated below:
OPERATING DATA
<TABLE>
<CAPTION>
Three Months Ended
December 31
1996 1995
--------- ---------
<S> <C> <C>
Passengers 1,560,485 1,610,268
Available seat miles (000) 589,142 629,483
Revenue passenger miles (000) 327,488 342,901
Load factor 55.6% 54.5%
Yield per revenue passenger mile 36.3(cent) 34.1(cent)
Operating cost per available seat mile 19.8(cent) 17.9(cent)
Revenue per available seat mile 20.6(cent) 19.1(cent)
Average stage length (miles) 170 166
Number of aircraft in fleet 183 180
Gallons of fuel consumed (000) 18,502 17,931
Block hours flown 136,162 136,726
Departures 146,067 153,490
</TABLE>
FINANCIAL DATA
7
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<TABLE>
<CAPTION>
Three Months Ended
December 31
----------------------------------------------------------------------------------------
1996 1995
----------------------------------------------------------------------------------------
Cost per Percent of total Cost per Percent of total
ASM operating revenues ASM operating revenues
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Flight operations 7.1(cent) 34.6% 7.1(cent) 37.1%
Maintenance 3.6(cent) 17.5% 3.1(cent) 16.2%
Aircraft and traffic servicing 3.5(cent) 16.8% 2.7(cent) 14.2%
Promotion and sales 2.9(cent) 14.5% 2.9(cent) 15.1%
General and administrative 1.2(cent) 5.7% 1.2(cent) 6.3%
Depreciation and amortization 1.5(cent) 7.0% 0.9(cent) 4.8%
----------------------------------------- -----------------------------------------
Total operating expenses 19.8(cent) 96.1% 17.9(cent) 93.7%
Interest expense 1.1(cent) 5.5% 0.3(cent) 1.4%
</TABLE>
OPERATIONS
Operating Revenues:
From the quarter ended December 31, 1995 compared to the quarter ended December
31, 1996, passenger revenues increased by 1.7 percent to $118.9 million.
Available seat miles (ASMs) declined by 6.4 percent to 589.1 million, passengers
carried decreased by 3.1 percent to 1.56 million and load factor increased by
1.1 percentage points to 55.6 percent. Average fare increased from $72.60 in the
prior-year first quarter to $76.20 in the current quarter. Mesa believes the
increase in load factor and average fare is primarily a result of enhanced
revenue management practices and the reduction of capacity in certain markets.
Freight and other revenues declined by 10.9 percent to $1.7 million. Most of
this decline is related to a 6.4 percent reduction in ASMs. Public service
revenue declined by 29.9 percent to $835,000. The decline in public service
revenue was a direct result of a reduction in the amount of essential air
service contracted by the United States Department of Transportation.
Operating Expenses:
Flight Operations:
Flight operations expense decreased to $42.0 million from $44.6 million in the
quarter ended December 31, 1995. The primary cause of this decrease was the
purchase in May 1996 of 69 aircraft formerly operated by Mesa under operating
leases. Had such aircraft remained on operating leases, flight operations
expense would have been approximately $6.7 million higher, but depreciation and
interest expense would have decreased by approximately $2.6 million and $4.7
million respectively. Although the net result of the purchase was an increase of
$600,000 in expenses for the quarter ended December 31, 1996, the completion of
this transaction has resulted in a substantial cash flow benefit to the Company
and, beginning in the 1998 fiscal year, is expected to result in lower and
steadily decreasing aircraft ownership costs for these 69 aircraft as underlying
debt is amortized.
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<PAGE> 9
For the quarter ended December 31, 1996, the cost of jet fuel increased by 26
percent to $.028 per ASM compared to $.022 per ASM in the quarter ended December
31, 1995, an amount equal to approximately $2.5 million.
Pilot training expense increased by $1 million over the comparative quarter
primarily as a result of integration of de Havilland Dash 8-200 aircraft into
the fleet, the addition of crews for five 30-passenger EMB 120 aircraft added to
the Los Angeles operation in November and December 1996 and pilot turnover.
Pilot salaries and other costs increased by 28 percent per ASM, totaling
approximately $2.0 million over the comparative quarter. Approximately $250,000
of this increase was related to increased salaries under Mesa's new contract
with the Airline Pilot's Association (ALPA) which became effective in December
1996, and $700,000 of the increase in pilot costs relates to salaries of pilots
in training. The remainder of the increase was attributable to additional pilots
hired to operate reserve aircraft.
Approximately $400,000 of costs were incurred during the quarter in the process
of centralizing the dispatch and training facilities in accordance with the
requirements of Mesa's agreement with the Federal Aviation Administration (FAA).
Less than $100,000 was expensed during the period to prepare the Fort Worth
facility for operations and integrate the Canadair Regional Jet (CRJ) into the
fleet. An additional $100,000 expense was incurred in a one-time transfer of
pilots and flight equipment on the West Coast in November 1996 to enable the
closure of two maintenance bases.
Maintenance Expense:
Maintenance expense for the current quarter increased by $1.9 million to $.036
per ASM, a 9.1 percent increase over the $.031 per ASM incurred in the
comparative quarter. Approximately $250,000 of the increase is attributable to a
wage increase granted to the Company's mechanics in September 1996.
Approximately $100,000 of the increase reflects costs to centralize maintenance
practices in accordance with Mesa's agreement with the FAA. In addition $300,000
of the increase was incurred in the closure of two maintenance bases in Arizona
and Oregon. The closure of these bases was made possible by the transfer of
pilots and flight equipment and is expected to save approximately $350,000 of
maintenance overhead expense per year. The balance of the increase in
maintenance expense was caused primarily by increased airframe maintenance
costs, the timing of annual "C"-check maintenance procedures on aircraft and
increased staffing levels to improve dispatch reliability.
Aircraft and Traffic Service Expense:
Aircraft and traffic service expense of $20.4 million increased by $3.3 million,
or 19 percent, over the prior-year comparable quarter. Station wages represented
$1.3 million of this increase. Expense in the amount of $500,000 was incurred
during the period to provide additional customer service representatives to the
Denver operation. Non-completion costs increased by $600,000 to $1.2 million
over the prior-year period as a result of severe weather conditions causing a
high percentage of flight cancellations throughout the system.
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Promotion and Sales Expense:
Promotion and sales expenses of $17.6 million declined by 2.9 percent over the
prior year's quarter. This decline is in proportion to a 3.1 percent decrease in
revenue passengers over the comparable period.
General and Administrative Expense:
General and administrative expense declined by $600,000 to $7.0 million over the
comparable period. Approximately half of the decrease related to a decline in
management bonus accrual in the current year. General and administrative expense
for the current quarter included $225,000 in costs related to recruiting
additional management positions required by Mesa's agreement with the FAA.
Depreciation, Amortization and Interest Expense:
Depreciation and amortization increased by $2.8 million, and interest expense
increased by $5.1 million over the comparable period of the prior year. The
increase in interest expense, depreciation and amortization is primarily the
result of the purchase of 69 aircraft previously financed by operating leases,
as explained under the Flight Operations Expense heading above.
Other Factors:
Mesa expensed approximately $725,000 during the current fiscal quarter in the
process of centralizing operations in accordance with its agreement with the
FAA. Management believes the total cost of centralization will amount to less
than the $2.5 million previously estimated. The process is expected to be
completed prior to the end of the current fiscal year.
The costs of centralization and the timing of completion are forward-looking
statements that involve a number of risks and uncertainties which could cause
actual results to differ materially from the forward-looking statements which
include, among other factors, promulgation of future FAA regulations or
administrative rules or informal requests by the FAA requiring the hiring of
additional personnel or payment of fines, the impact of future laws or
Congressional investigations and governmental regulations affecting the
Company's operations, or significant events which affect the Company's
operations causing a delay in implementation of centralization.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash and marketable securities at December 31, 1996 were $61
million compared to $60 million at September 30, 1996. The Company has
historically generated cash from operations which has been sufficient to meet
its operating needs. Cash, cash equivalents and marketable securities are
intended to be used for working capital, acquisitions and capital expenditures.
Mesa had receivables of $42 million at December 31, 1996 which consist primarily
of amounts due from code-sharing partners United and USAir. Under the terms of
the United and USAir agreement, Mesa receives a substantial portion of its
revenues through the Airline Clearing House. Historically, Mesa has generated
adequate cash flow to meet its operating needs.
Mesa currently has a $20 million line of credit, of which approximately $16
million is available. This line of credit is primarily used to facilitate the
issuance of letters of credit.
As of December 31, 1996, the Company had aggregate indebtedness of $383 million
payable to various parties under promissory notes issued in connection with the
purchase of 110 aircraft. The notes have
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interest rates ranging from 6.3 percent to 7.3 percent, maturities ranging
through 2009 and require monthly installments aggregating approximately
$1.2 million.
In addition, the Company has significant lease obligations on existing aircraft
operated by the Company. These leases are classified as operating leases and
therefore are not reflected as liabilities on the balance sheet. At December 31,
1996, 73 aircraft were leased by the Company with terms ranging up to 16 1/2
years. Aircraft lease expense for the quarter ended December 31, 1996 was $19.5
million. Future lease payments due under all aircraft operating leases were
approximately $241 million at December 31, 1996.
Mesa is planning to continue to operate two Fokker 70 aircraft through August
1997 at existing lease rates. In addition, Mesa has agreed to pay time-related
costs for use of the aircraft through the date of return.
Mesa has an aircraft order with Bombardier, Inc. to acquire 25 de Havilland Dash
8-200 aircraft worth $262.5 million with deliveries, which were scheduled to
begin in early 1996, through March 1998. Due to production delays, the delivery
schedule was delayed and Mesa was granted an option to cancel up to five of the
25 aircraft on order. The option expires April 30, 1997. As of December 31,
1996, Mesa had taken delivery of nine Dash 8-200 aircraft. Mesa has arranged
financing commitments for 19 of the 25 aircraft and is presently arranging
financing for the remaining aircraft on order. Bombardier will participate as
needed to finance any new aircraft deliveries. Mesa also has an option to
acquire 25 additional de Havilland Dash 8-200 aircraft. The Dash-8-200 aircraft
purchase agreement provides for a spare parts supply program, which includes all
required parts to maintain the aircraft, excluding engines and propellers, for a
period of seven years. Mesa will pay a fixed hourly charge per flight hour for
this spare parts supply program.
During August 1996, Mesa entered into a memorandum of understanding to acquire
16 Canadair Regional 50-passenger jet aircraft ("CRJs") worth approximately
$320 million with deliveries to begin in February 1997. Mesa will trade in 12
Embraer Brasilia aircraft for the 16 Canadair Regional jet aircraft on order. An
$8.3 million deposit has been made to Bombardier, Inc. related to this
commitment, and Bombardier will participate as needed to provide financing for
the CRJs to be acquired by Mesa. Mesa has options to acquire an additional 32
CRJ aircraft. In January 1997, Mesa and Bombardier completed a definitive
agreement regarding the acquisitions of the CRJs.
During December 1995, the Federal Aviation Administration (FAA) announced rules
which require commuter airlines with aircraft of 10 or more passenger seats
operating under FAR Part 135 rules to begin operating those aircraft under FAR
Part 121 regulations by the end of March 1997. Mesa is one of the largest
regional airlines operating under FAR Part 135 regulations. In anticipation of
Mesa's conversion to FAR Part 121 and to address issues raised in past
inspections, the FAA began a special review of Mesa's operations in June 1996.
As a result of the special review by the FAA of Mesa's operations, a consent
order was signed in September 1996 assessing a compromise civil penalty of
$500,000. Mesa paid $250,000 of the compromise amount, and the remaining
$250,000 may be waived in September 1997 upon Mesa complying with provisions of
the consent order. Under the consent order, Mesa has agreed to adopt operational
standards that exceed the requirements of the Federal Aviation Regulations. The
consent order requires that control of operational areas (maintenance, flight
operations and training) be consolidated under one central management team. The
Company has until September 1997 to complete the specified tasks. At present the
Company is in compliance with all but four items on the FAA's timetable. The
Company anticipates returning to full compliance with the timetable within 90
days. During any period of noncompliance, extension of times are available for a
fee of $5,000 per item for each 30-day extension. The timing of a return to full
compliance with FAA regulations is a forward-looking statement that involves a
number of risks and uncertainties which could cause actual results to differ
materially from the forward-looking statement which includes, among other
factors, promulgation of further FAA regulations or administrative rules or
informal requests by the FAA requiring the hiring of additional personnel or
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<PAGE> 12
payment of additional fines, the impact of future laws or Congressional
investigations and governmental regulations affecting the Company's operations,
or significant events which affect the Company's operations causing a delay in
completing the specified tasks.
Based on the required conversion to FAR Part 121 and the provisions of the FAA
consent order, Mesa anticipates a one-time capital expenditure of approximately
$1.0 million in fiscal 1997 to bring all aircraft currently being operated by
Mesa into compliance with the enacted FAR Part 121 rules. In addition, Mesa
presently anticipates ongoing operational costs in order to comply with the FAR
Part 121 rules and consent order of approximately $2.5 million per year. Mesa
management is also monitoring the extent of the new costs to be imposed on its
19- and 30-seat aircraft operations by implementation of additional operating
procedures required by FAR Part 121 beginning in March 1997. Efforts will be
made to minimize the cost of these additional procedures while fully meeting the
new requirements. The costs of converting aircraft to comply with FAA Part 121
and ongoing operational compliance costs are forward-looking statements that
involve a number of risks and uncertainties which could cause actual results to
differ materially from the forward-looking statements which include, among other
factors, promulgation of future FAA regulations or administrative rules or
informal requests by the FAA requiring the hiring of additional personnel, the
addition of new aircraft mechanical equipment and the payment of additional
fines, and the impact of future laws or Congressional investigations and
governmental results increasing the costs of compliance.
OTHER EVENTS
Mesa expects its ASM capacity to increase steadily throughout the balance of the
current fiscal year with deliveries of new Dash 8-200 aircraft, now arriving on
a consistent schedule, and deployment of the CRJ in Fort Worth, Texas scheduled
for May 1997. The anticipated ASM capacity is a forward-looking statement which
involves a number of risks and uncertainties which could cause results to
materially differ from the forward-looking statement. The following is a list of
factors, among others, that could cause actual results to materially differ: a
decrease in the existing flights of the Company caused by unforeseen market
conditions, competition, or by termination of any of the code-share agreements
with a major carrier or the financial setbacks of any of the Company's
code-sharing partners, unfavorable resolution of negotiations with
municipalities for the leasing of facilities, material delays in completion by
the manufacturer of ordered and yet-to-be delivered aircraft, fuel price
increases or changes in regional economic conditions, delay in FAA Part 121
certification for CRJ operation, shortage of pilots certified to operate the
Dash 8-200 or CRJs, or insufficient demand from passengers to justify projected
aircraft departures out of the Fort Worth, Texas hub.
Mesa has received sufficient Dash 8-200 aircraft to provide the proper capacity
to its Denver operation for its 1997 peak ski season and summer operations and
expects the operations there to improve significantly. However, the high cost of
operations at Denver International Airport are of continuing concern to the
management of Mesa. Therefore, substantial efforts are currently in process to
reduce and control costs of the Denver system. Expected improvement and
increased efficiency in the Denver operation is a forward-looking statement
which involves a number of risks and uncertainties which could cause actual
results to materially differ from the forward-looking statement. The following
is a list of factors, among others, that could cause actual results to
materially differ: fuel price increases or changes in regional economic
conditions which decrease demand for flights to ski destinations, changes in FAA
Part 121 certification for Dash 8-200 operation which requires additional
training, shortage of pilots certified to operate the Dash 8-200 and increasing
pilot turnover, or failure to reduce the high costs of operation in Denver
resulting in the scheduling of fewer flights.
Should management's efforts to reduce costs in the Denver system not result in
acceptable operating margins, or should certain other operations become
unprofitable as a result of costs imposed by new Part
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121 operating regulations, service levels for unprofitable routes may be reduced
and aircraft transferred to more suitable opportunities.
The following table lists the aircraft operated by Mesa as of December 31, 1996:
<TABLE>
<CAPTION>
Number of Aircraft
------------------------------ Passenger
Type of Aircraft Owned Leased Total Capacity
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beechcraft 1900 108 10 118 19
Embraer Brasilia 2 30 32 30
BAe Jetstream 31 21 21 19
Dash 8-200 9 9 37
Dash 8-300 1 1 50
Fokker 70 2 2 78
------------------------------
Total 110 73 183
------------------------------
</TABLE>
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The contents of Item 3. Legal Proceedings from the Form 10-K filed
for the fiscal year ended September 30, 1996 has been incorporated
by reference.
Item 2. Change in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
Exhibit 10.83 Bombardier Regional Aircraft Filed herewith
Division Purchase Agreement
CRJ-0351 between Bombardier,
Inc. and Mesa Air Group, Inc.
This Exhibit is the subject
of a confidential treatment
request and certain
confidential portions have
been omitted and filed
separately with the Securities
and Exchange Commission as
indicated by the bracketed
language [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND
EXCHANGE COMMISSION].
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the duly
authorized undersigned.
MESA AIR GROUP, INC.
Registrant
Date: February 14, 1997 /s/ W. Stephen Jackson
------------------------------------
W. Stephen Jackson
Chief Financial Officer
(Principal Accounting Officer)
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<PAGE> 1
Exhibit 10.83
BOMBARDIER REGIONAL AIRCRAFT DIVISION
PURCHASE AGREEMENT
CRJ-0351
Between
BOMBARDIER INC.
and
MESA AIR GROUP, INC.
Relating to the Purchase of
Sixteen (16) Canadair Regional Jet aircraft
[Confidential portions of this exhibit have been deleted and
filed seperately with the Securities and Exchange Commision]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
ARTICLE 1. INTERPRETATION.................................................1
ARTICLE 2. SUBJECT MATTER OF SALE.........................................2
ARTICLE 3. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................3
ARTICLE 4. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................3
ARTICLE 5. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................4
ARTICLE 6. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................5
ARTICLE 7. BUYER INFORMATION..............................................5
ARTICLE 8. CERTIFICATION..................................................7
ARTICLE 9. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................9
ARTICLE 10. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]..........................................11
ARTICLE 11. CHANGES.......................................................11
ARTICLE 12. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]..........................................12
ARTICLE 13. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]..........................................13
ARTICLE 14. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]..........................................14
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
ARTICLE 15. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................15
ARTICLE 16. TERMINATION....................................................15
ARTICLE 17. NOTICES........................................................17
ARTICLE 18. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................18
ARTICLE 19. [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]...........................................19
ARTICLE 20. ASSIGNMENT.....................................................21
ARTICLE 21. SUCCESSORS.....................................................22
ARTICLE 22. APPLICABLE LAWS................................................22
ARTICLE 23. CONFIDENTIAL NATURE OF AGREEMENT...............................22
ARTICLE 24. AGREEMENT......................................................22
</TABLE>
APPENDIX I [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
APPENDIX II [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
APPENDIX III [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
APPENDIX IV [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
APPENDIX V [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
EXHIBIT I Certificate Of Acceptance
EXHIBIT II BILL OF SALE
EXHIBIT III [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
EXHIBIT IV CHANGE ORDER
<PAGE> 4
This Agreement is made on the ______ day of ________________, 1997.
BY AND BETWEEN: BOMBARDIER INC., a Canadian Corporation represented
by its BOMBARDIER REGIONAL AIRCRAFT DIVISION (BRAD)
having an office at Garratt Boulevard, Downsview,
Ontario, Canada.
Unless the context requires otherwise, references
made herein to BRAD herein also include de Havilland
Inc. and its subsidiaries and Canadair Division,
(collectively "BRAD")
AND: MESA AIR GROUP, INC.,
2325 East 30th Street
Farmington, New Mexico,
U.S.A. 87401
("Buyer")
WHEREAS, Bombardier Inc., through its Canadair Manufacturing Division,
is engaged in the manufacture of the Canadair Regional Jet aircraft products;
and BRAD has been created for the purpose of providing marketing, sales and
customer support services for the Canadair Regional Jet aircraft and related
products;
WHEREAS, Buyer desires to purchase sixteen (16) Aircraft, (as later
defined), and related data, documents, and services according to this Agreement,
(as later defined), and BRAD desires to arrange the sale of such Aircraft, data,
documents and services to Buyer,
NOW THEREFORE, in consideration of the mutual covenants herein
contained, Buyer and BRAD agree as follows:
ARTICLE 1. INTERPRETATION.
1.1. The recitals above have been inserted for convenience only
and do not form part the Agreement.
1.2. The headings of the Articles of this Agreement are included
for convenience only and shall not be used in the construction and
interpretation of this Agreement.
1.3. In this Agreement, unless otherwise expressly provided, the
singular includes the plural and vice-versa.
1.4. In this Agreement the following expressions shall, unless
otherwise expressly provided, mean:
<PAGE> 5
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
"Agreement" means this Agreement, including its Exhibits,
Annexes, Appendices and Letter Agreements, if any, attached hereto
(each of which is incorporated in the Agreement by this reference), as
they may be amended pursuant to the provisions of the Agreement;
"Aircraft" shall have the meaning attributed to it in Article
2.1;
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
"FAA" shall have the meaning attributed to it in Article 8.1;
"Notice" shall have the meaning attributed to it in Article 17.1;
"Permitted Change" shall have the meaning attributed to it in Article
11.2;
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION];
"Regulatory Change" shall have the meaning attributed to it in Article
8.4;
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
"Taxes" shall have the meaning attributed to it in Article 4.3.
1.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES EXCHANGE COMMISSION].
-2-
<PAGE> 6
ARTICLE 2. SUBJECT MATTER OF SALE.
2.1. Subject to the provisions of this Agreement, BRAD will sell and
Buyer will purchase sixteen (16) Canadair Regional Jet aircraft [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION].
ARTICLE 3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES EXCHANGE COMMISSION].
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES EXCHANGE COMMISSION].
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
-3-
<PAGE> 7
5.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.4. Buyer shall make [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] to BRAD's account in the
following manner:
(a) Transfer to: National Bank of Canada
New York, N.Y. 10101 USA
Fed. ABA 026005487
(b) For credit to: National Bank of Canada
UID 014897
600 de la Gauchetiere St. West
Montreal, Quebec, H3B 4L3
Transit No. 1504-1
(c) For further credit to: Bombardier Inc.
Canadair Division
Account No.: 00-586-64
5.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.7. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
6.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 7. BUYER INFORMATION
7.1. During [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION], Buyer [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION], Buyer [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]:
-4-
<PAGE> 8
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
7.2 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
7.3. The [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] BRAD pursuant to this Article shall
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
-5-
<PAGE> 9
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
(e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
(f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
7.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
7.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
7.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
7.7. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
-6-
<PAGE> 10
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 8. CERTIFICATION.
8.1. BRAD has obtained from Transport Canada ("TC") a TC Type
Approval (Transport Category) and from the Federal Aviation Administration of
the United States ("FAA") an FAA Type Certificate for [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
8.2. BRAD [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
8.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
8.4. If any addition or change to, or modification or testing
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] is required by any law or governmental regulation or
requirement or interpretation thereof by any governmental agency having
jurisdiction in order to [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
8.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
8.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
8.7. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
8.8. If the use of any of the certificates identified in this
Article 8 are discontinued during the performance of this Agreement, reference
to such discontinued certificate shall be deemed a reference to any other
certificate or instrument which corresponds to such certificate or, if there
should not be any such other certificate or instrument, [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
-7-
<PAGE> 11
ARTICLE 9. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH SECURITIES
AND EXCHANGE COMMISSION].
9.1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.7. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
-8-
<PAGE> 12
9.8. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.9. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 10. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
10.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
10.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 11. CHANGES.
11.1. Other than [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] as described in [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION], any change to this Agreement [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]. Should Buyer
request a change, BRAD shall advise Buyer of the effect, if any, of such change
request on:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
11.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
-9-
<PAGE> 13
1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE AND EXCHANGE COMMISSION]
2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
3) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION],
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
ARTICLE 12. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
12.1. From time to time, commencing with the date of this Agreement
and [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
12.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
12.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
12.4. At any time [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
12.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 13. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
13.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
-10-
<PAGE> 14
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(g) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(h) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
13.2. (a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
13.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
13.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 14. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
14.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
14.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
14.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
-11-
<PAGE> 15
ARTICLE 15. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
15.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 16. TERMINATION.
16.1. This Agreement may be terminated, in whole or in part, with
respect to any or all of the Aircraft before the Delivery Date by BRAD or Buyer
by notice of termination to the other party upon the occurrence of any of the
following events:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
16.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
16.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
16.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
-12-
<PAGE> 16
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
16.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 17. NOTICES.
17.1. Any notice, request, approval, permission, consent or other
communication ("Notice"), to be given or required under this Agreement shall be
provided in writing, by registered mail, facsimile, courier, telegraphic or
other electronic communication providing reasonable proof of transmission,
except that no notice shall be sent by mail if disruption of postal service
exists or is threatened either in the country of origin or of destination, by
the party giving the Notice and shall be addressed as follows:
(a) Notice to BRAD shall be addressed to:
Bombardier Inc.
Bombardier Regional Aircraft Division
Garratt Boulevard
Downsview, Ontario
Canada
M3K 1Y5
Attention: Walter A. Galloway, Director, Contracts
Telex: 06-22128
Facsimile: (416) 375-4533
(b) Notice to Buyer shall be addressed to:
Attention: Mr. Larry Risley, Chairman
Mesa Air Group, Inc.
2325 East 30th
Farmington, New Mexico
U.S.A. 87401
Facsimile: 505-326-4485
17.2. Notice given in accordance with Article 17.1 shall be deemed
sufficiently given to and received by the addressees:
(a) if delivered by hand, on the day when the same shall have
been so delivered; or
(b) if mailed or sent by courier on the day indicated on the
corresponding acknowledgment of receipt; or
(c) if sent by telex or facsimile on the day indicated by the
acknowledgment or the answer back of the receiver in provable form.
-13-
<PAGE> 17
ARTICLE 18. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
18.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
18.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
18.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
18.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 19. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
19.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
19.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION],
A. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
-14-
<PAGE> 18
B. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
C. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
D. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
19.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
19.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
19.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
ARTICLE 20. ASSIGNMENT.
20.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
20.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
20.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
20.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
20.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 21. SUCCESSORS.
This Agreement shall inure to the benefit of and be binding upon each
of BRAD and Buyer and their respective successors.
-15-
<PAGE> 19
ARTICLE 22. APPLICABLE LAWS.
22.1. This Agreement shall be subject to and construed in accordance
with and the rights of the parties shall be governed by [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
22.2. BRAD's obligations under this Agreement shall be subject to
and apply only to the extent permitted by applicable laws, regulations,
directives and/or orders [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 23. CONFIDENTIAL NATURE OF AGREEMENT.
23.1. This Agreement is confidential between the parties and shall
not, without the prior written consent of the other party, be disclosed by
either party in whole or in part to any other person or body except as may be
necessary for either party to carry out its obligations under this Agreement and
fulfill its obligations under the applicable securities laws governing each
party. The parties shall however only disclose those parts of the agreement
which are expressly required by such securities laws.
23.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
23.3. Either party may announce the signing of this Agreement by
means of a notice to the press provided that the content and date of the notice
has been agreed to by the other party.
ARTICLE 24. AGREEMENT.
24.1. This Agreement and the matters referred to herein constitute
the entire Agreement between BRAD and Buyer and supersede and cancel all prior
representations, brochures, alleged warranties, statements, negotiations,
undertakings, letters, memorandum of Agreement, acceptances, agreements,
understandings, contracts and communications, whether oral or written, between
BRAD and Buyer or their respective agents, with respect to or in connection with
the subject matter of this Agreement and no agreement or understanding varying
the terms and conditions hereof shall be binding on either BRAD or Buyer hereto
unless an amendment to this Agreement is issued and duly signed by their
respective authorized representatives pursuant to the provisions of this Article
hereof. All Appendices, Exhibits and Annexes referred to herein and attached
hereto are made part of this Agreement by reference. In the event of any
inconsistencies between this Agreement and any of the Appendices, Exhibits and
Annexes or other documents referred to herein, the provisions of this Agreement
shall prevail.
24.2. If any of the provisions of this Agreement are for any reason
declared by judgment of a court of competent jurisdiction to be unenforceable or
ineffective, those
-16-
<PAGE> 20
provisions shall be deemed severable from the other provisions of this Agreement
and the remainder of this Agreement shall remain in full force and effect.
24.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
24.4. BRAD and Buyer confirm to each other they have each obtained
the required authorizations and fulfilled any conditions applicable to enable
each of them to enter into this Agreement.
-17-
<PAGE> 21
IN WITNESS WHEREOF this Agreement was signed on the date written hereof:
For and on behalf of For and on behalf of
BUYER: BRAD:
Per: ___________________________________ Per:__________________________
Title: ______________________________ Title:_____________________
-18-
<PAGE> 22
APPENDIX I
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 23
APPENDIX II
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 24
APPENDIX III
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
SEPTEMBER 24 1996
<PAGE> 25
APPENDIX IV
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 26
APPENDIX V
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 27
EXHIBIT I
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 28
Exhibit II
BILL OF SALE
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 29
EXHIBIT III
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 30
Exhibit IV
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 31
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
-2-
<PAGE> 32
MESA AIR GROUP, INC.
CRJ-0351 LETTER AGREEMENTS
B96-7701-RJTL-CRJ0351-001 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-002 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-003 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-004 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-005 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-006 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-007 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-008 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-009 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-010 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-011 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-012 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-013 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 33
B96-7701-RJTL-CRJ0351-014 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
B96-7701-RJTL-CRJ0351-015 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 34
BOMBARDIER INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
GARRATT BOULEVARD
DOWNSVIEW, ONTARIO
CANADA M3K 1Y5
TELEPHONE (416) 633-7310
February 12, 1997
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Gentlemen:
Re: Letter Agreement No. 001 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
Subject: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0. In consideration of Buyer having entered into the above
referenced Agreement, BRAD agrees to reserve sixteen (16) additional aircraft
(the "Option Aircraft") [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]:
<PAGE> 35
Section 1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 1.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 1.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 1.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 3.0. In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
Section 4.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 5.0. The provisions of this Letter Agreement are personal to
Buyer and shall not be assigned or otherwise disposed of by Buyer without the
prior written consent of BRAD.
-2-
<PAGE> 36
Should there be any inconsistency between this Letter Agreement and
the Agreement with respect to the subject matter covered by the terms hereof,
then this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
__________________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
This _________ day of January, 1997
MESA AIR GROUP, INC.
By_________________________________________
Title:___________________________________
-3-
<PAGE> 37
BOMBARDIER INC.
BOMBARDIER REGIONAL
AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
Telephone (416) 633-7310
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-002
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Re: Letter Agreement No. 002
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
<PAGE> 38
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
Section 1.0. In consideration of Buyer having entered into the above
referenced Agreement, and in addition to the provisions of Letter Agreement 001,
BRAD agrees to reserve sixteen (16) additional aircraft (the "Rolling Option
Aircraft") [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.6. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
Section 1.7. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 1.8. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
-2-
<PAGE> 39
Section 2.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 3.0. In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
Section 4.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 5.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Should there be any inconsistency between this Letter Agreement and
the Agreement with respect to the subject matter covered by the terms hereof,
then this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
___________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this _____ day of January, 1997
MESA AIR GROUP, INC.
By: _________________________________
Title: _______________________________
-3-
<PAGE> 40
BOMBARDIER, INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
Telephone (416) 633-7310
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-003
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Re: Letter Agreement No. 003
[CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 41
Section 2.0. In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
Section 3.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this _____ day of January, 1997
MESA AIR GROUP, INC.
By: _______________________________
Title: ______________________________
-2-
<PAGE> 42
BOMBARDIER INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
January 10, 1997
Our Ref: B96-7701-RJTL-CRJ0351-004
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Re: Letter Agreement No. 004 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement. In this Letter Agreement No. 004 the
term Aircraft shall apply to the thirty two (32) Canadair Regional Aircraft (16
Firm and 16 Option Aircraft).
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
<PAGE> 43
Section 2.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 3.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 4.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 5.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 6.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 7.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 8.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 9.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 10.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]:
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION];
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(iii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION];
-2-
<PAGE> 44
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 11.0. In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
Section 12.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this ____ day of January, 1997
MESA AIR GROUP, INC.
By: ________________________________
Title: ________________________________
-3-
<PAGE> 45
February 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-005
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Re: Letter Agreement No. 005
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
1.0 In consideration of Buyer having entered into the above referenced
Agreement for the purchase of sixteen (16) Aircraft, and
notwithstanding the provisions of Article 5.2 of the Agreement, payment
for the Aircraft will be made, and Article 5.2 of the Agreement is
amended to read, as follows:
1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
a. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 46
b. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
c. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
d. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
3.0 In the event of the termination of the Agreement, this Letter Agreement
shall become automatically null and void, and the disposition of the
Deposit per a.) above, and the Deposit per b.) above will be determined
in accordance with the Agreement.
4.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
______________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this _________ day of January, 1997
MESA AIR GROUP, INC.
By:____________________________________
Title:_________________________________
-2-
<PAGE> 47
February 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-006
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Re: Letter Agreement No. 006
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ0351 (the "Agreement") between
Bombardier Inc., represented by its Bombardier Regional Aircraft Division
("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen (16)
Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall have
the same meaning as in the Agreement.
1.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
2.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
2.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
<PAGE> 48
2.1.1. The term of this Letter Agreement [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION]
2.1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION];
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
2.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
3.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
3.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
3.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
4.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
-2-
<PAGE> 49
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
4.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
5.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
5.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
6.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
7.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
8.0. Reporting.
8.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
8.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
-3-
<PAGE> 50
9.0. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
9.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
9.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
If the foregoing correctly sets forth your understanding of our agreement
with respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly
BOMBARDIER INC.
_________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this _________ day of January, 1997
MESA AIR GROUP, INC.
By:_____________________________________
Title:__________________________________
-4-
<PAGE> 51
APPENDIX "A"
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
<PAGE> 52
Thu, Feb 13, 1997
Our Ref: B96-7701-CRJ0351-RJTL-007
Mesa Air Group, Inc.
2325 East 30th
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Gentlemen:
Re: Letter Agreement No. 007 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. B96-7701-RJTL-CRJ0351 (the
"Agreement") between Bombardier, Inc., represented by its Bombardier Regional
Aircraft Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of
sixteen (16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have
the same meanings as in the Agreement.
Subject: Delivery Deficiencies
Section 1.0 Intent. The intent of this letter agreement is to provide
assurance to Buyer that BRAD [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
Section 2.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 3.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
BUYER AND BRAD STATE AND AGREE THAT THIS LETTER HAS BEEN THE SUBJECT OF
DISCUSSION AND NEGOTIATION AND IS FULLY UNDERSTOOD BY THE PARTIES HERETO AND
THAT THE PRICE OF THE AIRCRAFT AND THE OTHER MUTUAL AGREEMENTS OF THE PARTIES
<PAGE> 53
SET FORTH IN THE AGREEMENT WERE ARRIVED AT IN CONSIDERATION OF THE PROVISIONS
CONTAINED HEREIN.
If the foregoing correctly sets forth your understanding of our
agreement with respect to the above matters, please indicate your acceptance and
agreement below.
Yours truly
BOMBARDIER, INC,.
__________________________________
Walter Galloway
Director, Contracts
Accepted and Agreed to:
this .____. day of January, 1997
MESA AIR GROUP, INC.
By: ___________________________________
Title: ___________________________________
<PAGE> 54
Date
Our Ref: B96-7701-CRJ0351-RJTL-008
Mesa Air Group, Inc.
2325 East 30th
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Gentlemen:
Re: Letter Agreement No. 008
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. B96-7701-RJTL-CRJ0351 (the
"Agreement") between Bombardier, Inc., represented by its Bombardier Regional
Aircraft Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of
sixteen (16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms herein and in the Agreement and not defined herein shall have
the same meanings as in the Agreement.
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(A) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
<PAGE> 55
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(B) DEFINITIONS
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(3) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(4) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]:
(a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
-2-
<PAGE> 56
(f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(g) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(h) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(i) (A) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(B) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(j) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(k) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(5) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(6) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
-3-
<PAGE> 57
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(7) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(C) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(iii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(iv) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(v) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(D) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
-4-
<PAGE> 58
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(3) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(4) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(5) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(6) All reports [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] shall be submitted by Buyer to the
attention of:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Bombardier Regional Aircraft Division
123 Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
Tel: (416) 633-7310
(E) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
(F) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
(2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
-5-
<PAGE> 59
(3) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(4) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
(G) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
If the foregoing correctly sets forth your understanding of our agreement
with respect to the above matters, please indicate your acceptance and agreement
below.
Yours truly
BOMBARDIER INC.
_______________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO this _______ day
of January, 1997
MESA AIR GROUP, INC.
By:________________________________
Title:____________________________
-6-
<PAGE> 60
ATTACHMENT A
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
<PAGE> 61
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-009
Mesa Air Group, Inc.,
2325 East 30th,
Farmington, New Mexico.
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Gentlemen,
Re: Letter Agreement No. 009 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. CRJ0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
Subject: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
<PAGE> 62
If the foregoing correctly sets forth your understanding of our
agreement with respect to the above matters, please indicate your acceptance and
agreement below.
Yours truly
BOMBARDIER INC.
-----------------------------------
Walter Galloway
Director, Contracts
Accepted and Agreed to:
this day of January, 1997
-------
MESA AIR GROUP, INC.
By:
------------------------------------
Title:
------------------------------------
<PAGE> 63
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-010
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Gentlemen,
Re: Letter Agreement No. 010
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
Subject: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(iii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(iv) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 64
(v) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(vi) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(vii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(viii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
Section 2.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 3.0 This Letter Agreement constitutes an integral part of the
Agreement and subject to the terms and conditions contained therein.
Section 4.0 In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
-----------------------------------
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this _____ day of January, 1997
MESA AIR GROUP, INC.
By:
---------------------------------
Title:
---------------------------------
-2-
<PAGE> 65
BOMBARDIER INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
Telephone (416) 633-7310
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-011
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Re: Letter Agreement No. 011 (Re: Performance Guarantee)
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
SUBJECT: PERFORMANCE GUARANTEE
Section 1.0. Aircraft Configuration. The guarantees listed below are
based on the Aircraft configuration as defined in Canadair Customized Type
Specification RAD-601R-123 Issue NC, and equipped with GE CF34-3B1 engines as
defined in GE Engines Specification E1271A. The weight data corresponds to the
53000 lb (24040 kg) MTOW design weight option and includes the weight changes
associated with the centre-wing fuel tank. Appropriate adjustments shall be made
for changes in configuration approved by Buyer and BRAD or otherwise allowed by
the Purchase Agreement which cause changes to the performance of the Aircraft.
<PAGE> 66
Section 2.0. Airport Conditions. All maximum take-off weight
calculations are based on the aircraft configuration and runway conditions
described below:
-- Take-off with zero bleed, APU off
-- APR armed
-- Dry runway (no reverse thrust)
-- Balanced field length when optimum
-- Wind: 0 kts
-- Clearway: 0 ft
-- Stopway: 0 ft
-- Flaps: optimum 8 or 20 deg
-- Line-up allowance: 82 ft
-- Obstacles are defined from start of runway
Airport: PHX , PHOENIX SKY HARB
Runway: generic
Slope: 0.000 %
TORA: 11000 ft
Elev.: 1133 ft
Temper.: 110.1 deg F (43.40 degC)
Obst.: none
Airport: DSM , DES MOINES INTL
Runway: generic
Slope: 0.000 %
TORA: 9000 ft
Elev.: 957 ft
Temper.: 90 degF (32.20 degC)
Obst.: none
Airport: FAT , FRESNO
Runway: generic
Slope: 0.000 %
TORA: 9220 ft
Elev.: 333 ft
Temper.: 90 degF (32.20 degC)
Obst.: none
-2-
<PAGE> 67
Airport: BHM , BIRMINGHAM MUNICIP.
Runway: 23
Slope: 0.200 % downhill
TORA: 8229 ft
Elev.: 644 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 9219 -10
2 13294 68
3 15722 120
Airport: BUF , GREATER BUFFALO INT.
Runway: 23
Slope: 0.400 % downhill
TORA: 8100 ft
Elev.: 724 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 8576 -47
2 8671 -36
3 9275 -27
4 9623 -2
5 10351 -1
6 10643 3
7 11510 19
Airport: BZN , GALLATIN FIELD
Runway: 30
Slope: 0.200 % downhill
TORA: 9003 ft
Elev.: 4474 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 10295 -11
2 78396 432
3 95194 632
-3-
<PAGE> 68
Airport: DAY , COX-DAYTON INTL
Runway: 06L
Slope: 0.000 %
TORA: 10900 ft
Elev.: 1009 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 12579 1
2 12684 2
3 14173 68
Airport: DEN , DENVER INTL
Runway: 35L
Slope: 0.500 % downhill
TORA: 12000 ft
Elev.: 5431 ft
Temper.: 90 degF (32.20 degC)
Obst.: none
Airport: DRO , DURANGO
Runway: 20
Slope: 0.760 % downhill
TORA: 9200 ft
Elev.: 6685 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 9505 -61
2 24193 -41
3 30318 -16
Airport: EGE , EAGLE CO REGL
Runway: 07
Slope: 1.000 % uphill
TORA: 8000 ft
Elev.: 6535 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 14961 349
2 16982 484
3 22461 844
4 34416 933
5 46044 1045
6 49410 1353
-4-
<PAGE> 69
Airport: ELP , EL PASO
Runway: 22
Slope: 0.250 % downhill
TORA: 11011 ft
Elev.: 3956 ft
Temper.: 90 degF (32.30 degC)
Obst.: none
Airport: FAR , HECTOR INTL
Runway: 35
Slope: 0.000 %
TORA: 9545 ft
Elev.: 900 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 10994 2
2 11142 11
3 11539 12
Airport: GRR , KENT CO INTL
Runway: 26L
Slope: 0.000 %
TORA: 10000 ft
Elev.: 794 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 34298 120
Airport: GSO , PIEDMONT TRIAD INTL
Runway: 05
Slope: 0.200 % downhill
TORA: 10000 ft
Elev.: 926 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 10942 -7
-5-
<PAGE> 70
Airport: GTF , GREAT FALLS INT'L AP
Runway: 03
Slope: 0.100 % downhill
TORA: 10500 ft
Elev.: 3674 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 34275 445
Airport: HSV , HUNTSVILLE INT-JONES
Runway: 18L
Slope: 0.200 % downhill
TORA: 10000 ft
Elev.: 630 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 41916 182
2 81408 432
Airport: JAN , JACKSON INTL
Runway: 15L
Slope: 0.500 % uphill
TORA: 8500 ft
Elev.: 346 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 15433 188
Airport: MSN , DANE CO REG'L/TRUAX
Runway: 36
Slope: 0.000 %
TORA: 9003 ft
Elev.: 862 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 9603 3
2 10105 11
3 10210 24
4 10548 42
5 54574 180
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<PAGE> 71
Airport: MSO , MISSOULA INTL
Runway: 11
Slope: 0.100 % uphill
TORA: 9500 ft
Elev.: 3201 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 9846 10
2 9902 13
3 48038 313
4 48937 482
5 69994 1007
Airport: PNS , PENSACOLA REG'L APT
Runway: 17
Slope: 0.200 % downhill
TORA: 7000 ft
Elev.: 121 ft
Temper.: 90 degF (32.30 degC)
Obst.:
# distance (ft) height (ft)
1 8100 -11
2 9000 -10
3 17116 58
Airport: RDU , RALEIGH-DURHAM INTL
Runway: 05L
Slope: 0.400 % uphill
TORA: 10000 ft
Elev.: 436 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 11473 48
2 12556 81
3 12848 94
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<PAGE> 72
Airport: ROC , GREATER ROCHESTER
Runway: 22
Slope: 0.400 % downhill
TORA: 8000 ft
Elev.: 559 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 9728 9
2 11378 42
3 12628 57
4 141664 427
Airport: SBN , MICHIANA REGL
Runway: 09R
Slope: 0.300 % downhill
TORA: 7100 ft
Elev.: 799 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 9318 2
2 46591 277
Airport: SDF , STANDIFORD FIELD
Runway: 01
Slope: 0.300 % uphill
TORA: 10000 ft
Elev.: 496 ft
Temper.: 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 10800 33
2 11162 45
3 12454 82
4 14554 124
5 14826 133
6 15213 137
7 15988 159
8 41598 349
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<PAGE> 73
Airport: TYS , MCGHEE TYSON
Runway: 05L
Slope: 0.900 % uphill
TORA: 9005 ft
Elev.: 981 ft
Temper.: 90 degF (32.30 degC)
Obstacles
# distance (ft) height (ft)
1 10358 72
2 11798 101
3 14423 126
Airport: ASE , PITKIN CO/SARDY
Runway: 33
Slope: 1.000 % downhill
TORA: 7000 ft
Elev.: 7815 ft
Temper. : 90 degF (32.20 degC)
Obst.:
# distance (ft) height (ft)
1 7723 -24
2 8750 421
3 1950 602
4 37047 1031
5 56759 1747
SECTION 3.0 PERFORMANCE GUARANTEE
Section 3.1. Take-off Performance. FAR take-off field length, at a
take-off gross weight of 53000 lb, at the start of ground run, at sea level with
zero runway slope, no obstacles, zero wind, ISA conditions, shall be not more
than 6315 feet.
Section 3.2. Landing Performance. FAR landing field length, at a
landing weight of 47000 lb, sea level, ISA conditions, no obstacles, zero wind,
shall be not more than 4850 feet.
Section 3.3. Speed. Level flight airspeed at 50350 lb gross weight
(equivalent to 95% of Maximum Take-off Weight), at a pressure altitude of 31000
feet, using maximum cruise thrust with A.C.U. bleed only, in ISA+15oC conditions
shall not be less than 0.74 M 448 KTAS).
Section 3.4. Specific Air Range. The nautical air miles per
pound of fuel in ISA+15oC conditions, at 31000 feet pressure altitude, at an
Aircraft gross weight of 50350 lb, at a true Mach number of 0.74 M shall be not
less than 0.162 nam/lb.
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<PAGE> 74
SECTION 3.5. MISSION PERFORMANCE
Section 3.5.1. Maximum Range Guarantee. When operated under the
conditions specified below with the fixed quantities and allowances specified in
Article 3.5.3, the maximum still air range (stage length) shall be not less than
1375 nautical miles (1583 statute miles) when carrying a fixed payload of 11000
lb (50 passengers).
Take-off is at a fixed weight of 53000 lb at brake release.
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 181 lb of fuel is considered for 1.8 minutes
take-off and acceleration time to 250 KCAS initial climb speed at 1500
feet above sea level.
Climb is made starting at 1500 feet to 31000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 31000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Step climb is made starting at 31000 feet to 33000 feet pressure
altitude using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 33000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Descent is made from 33000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
SECTION 3.5.2. BLOCK FUEL GUARANTEES
Section 3.5.2.1. Stage Length - 250 n.m. For a mission with an
equivalent still air range (stage length) of 250 nautical miles (288 statute
miles), when operated under the conditions specified below with the fixed
quantities and allowances specified in Article 3.5.3, the block fuel burnt shall
be not more than 2219 lb, based on a block time of 63 minutes, equivalent to an
average fuel consumption of 311 U.S. Gallon per block hour, when carrying a
fixed payload of 11000 lb (50 passengers).
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 155 lb of fuel is considered for 1.5 minutes
take-off and acceleration time to initial climb speed at 1500 feet
above sea level.
Climb is made starting at 1500 feet to 27000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
-10-
<PAGE> 75
Cruise is at 27000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Descent is made from 27000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
Section 3.5.2.2. Stage Length - 500 n.m. For a mission with an
equivalent still air range (stage length) of 500 nautical miles (575 statute
miles), when operated under the conditions specified below with the fixed
quantities and allowances specified in Article 3.5.3, the block fuel burnt shall
be not more than 3526 lb, based on a block time of 99 minutes, equivalent to an
average fuel consumption of 314 U.S. Gallon per block hour, when carrying a
fixed payload of 11000 lb (50 passengers).
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 160 lb of fuel is considered for 1.6 minutes
take-off and acceleration time to initial climb speed at 1500 feet
above sea level.
Climb is made starting at 1500 feet to 35000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 35000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Descent is made from 35000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
Section 3.5.2.3. Stage Length - 750 n.m. For a mission with an
equivalent still air range (stage length) of 750 nautical miles (863 statute
miles), when operated under the conditions specified below with the fixed
quantities and allowances specified in Article 3.5.3, the block fuel burnt shall
be not more than 4939 lb, based on a block time of 135 minutes, equivalent to an
average fuel consumption of 323 U.S. Gallon per block hour, when carrying a
fixed payload of 11000 lb (50 passengers).
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 165 lb of fuel is considered for 1.6 minutes
take-off and acceleration time to initial climb speed at 1500 feet
above sea level.
Climb is made starting at 1500 feet to 35000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 35000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
-11-
<PAGE> 76
Descent is made from 35000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
Section 3.5.2.4. Stage Length - 1000 n.m. For a mission with an
equivalent still air range (stage length) of 1000 nautical miles (1151 statute
miles), when operated under the conditions specified below with the fixed
quantities and allowances specified in Article 3.5.3, the block fuel burnt shall
be not more than 6399 lb, based on a block time of 169 minutes, equivalent to an
average fuel consumption of 334 U.S. Gallon per block hour, when carrying a
fixed payload of 11000 lb (50 passengers).
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 171 lb of fuel is considered for 1.7 minutes
take-off and acceleration time to initial climb speed at 1500 feet
above sea level.
Climb is made starting at 1500 feet to 33000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 33000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Step climb is made starting at 33000 feet to 35000 feet pressure
altitude using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 35000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Descent is made from 35000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
Section 3.5.2.5. Stage Length - 1250 n.m. For a mission with an
equivalent still air range (stage length) of 1250 nautical miles (1439 statute
miles), when operated under the conditions specified below with the fixed
quantities and allowances specified in Article 3.5.3, the block fuel burnt shall
be not more than 7905 lb, based on a block time of 204 minutes, equivalent to an
average fuel consumption of 342 U.S. Gallon per block hour, when carrying a
fixed payload of 11000 lb (50 passengers).
The mission is flown in ISA+15oC conditions throughout.
A fixed allowance of 177 lb of fuel is considered for 1.8 minutes
take-off and acceleration time to initial climb speed at 1500 feet
above sea level.
Climb is made starting at 1500 feet to 33000 feet pressure altitude
using a climb speed schedule of 250 KCAS/ 0.70 M.
-12-
<PAGE> 77
Cruise is at 33000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Step climb is made starting at 33000 feet to 35000 feet pressure
altitude using a climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at 35000 feet pressure altitude at an average cruise Mach
number of 0.74 M. Thrust during cruise is not to exceed maximum cruise
thrust.
Descent is made from 35000 feet to 1500 feet pressure altitude using a
descent speed schedule of 0.70 M / 250 KCAS.
Section 3.5.3. Fixed Quantities and Allowances for Maximum Range and
Block Fuel Guarantees. For the purpose of this guarantee the following are fixed
quantities and allowances:
-- 9 minutes engine start and taxi-out fuel 120 lb
-- 4.2 minutes approach and landing fuel from 1500 119 lb
feet pressure altitude to sea level
-- 6 minutes taxi-in fuel (taken from reserves) 80 lb
-- Usable reserve fuel remaining upon completion 2286 lb
of landing phase, based on the reserve profile
specified below:
(1) 100 nm diversion including:
climb from sea level to 19000 feet at a speed of 250 KCAS
(ii) cruise at 19000 feet at long range cruise speed
(LRC)
(iii) descent to sea level at a speed of 250 KCAS.
(2) plus fuel equivalent to 45 minutes hold at 10000 feet at
long-range cruise speed (LRC).
The stage length is defined as the sum of the climb, cruise and descent
distances.
M denotes true Mach number.
Block fuel includes engine start, taxi, take-off, climb, cruise,
descent, approach and landing.
The maximum range and fuel burn guarantees given in Articles 3.5.1 and
3.5.2 are based on the fixed estimated Operating Weight Empty (O.W.E.)
of 31075 lb.
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<PAGE> 78
Section 3.5.4. Maximum payload guarantees. Under the conditions
specified in 3.5.2 and with the fixed quantities and allowances specified in
3.5.3, the maximum number of passengers shall not be less than the value
presented in the table below for each mission.
<TABLE>
<CAPTION>
CRUISE
ROUTE AVERAGE EQUIV. PRESSURE
DIST. WINDS STILL AIR ALTITUDE
CASE # FROM TO (NM) (KTS) (NM) (100 FT) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 DRO DEN 224 -13 232 330 41
2 DEN DRO 283 -48 324 350 50
3 DEN EGE 118 -50 137 240 50
4 EGE DEN 130 4 128 270 9
5 DEN BHM 999 29 931 370 50
6 BHM DEN 967 -84 1218 350 50
7 DEN BUF 1190 27 1114 370 50
8 BUF DEN 1196 -79 1482 350 49
9 DEN BZN 589 -67 707 350 50
10 BZN DEN 508 10 494 370 50
11 DEN DAY 964 29 898 370 50
12 DAY DEN 964 -84 1212 350 50
13 DEN ELP 514 -33 561 350 50
14 ELP DEN 534 -28 576 370 50
15 DEN FAR 583 -13 603 370 50
16 FAR DEN 591 -45 667 350 50
17 DEN GRR 890 22 842 370 50
18 GRR DEN 897 -77 1105 350 50
19 DEN GSO 1240 35 1139 370 50
20 GSO DEN 1280 -89 1631 350 46
21 DEN GTF 552 -64 658 350 50
22 GTF DEN 553 8 540 370 50
23 DEN HSV 919 29 856 370 50
24 HSV DEN 928 -86 1174 350 50
25 DEN JAN 883 22 835 370 50
26 JAN DEN 872 -80 1084 350 50
27 DEN MSN 753 17 721 370 50
28 MSN DEN 753 -74 921 350 50
29 DEN MSO 616 -68 741 350 50
30 MSO DEN 625 13 604 370 50
31 DEN PNS 1129 24 1064 370 50
32 PNS DEN 1121 -80 1391 350 47
33 DEN RDU 1290 36 1183 370 50
34 RDU DEN 1327 -89 1691 350 45
35 DEN ROC 1236 27 1157 370 50
36 ROC DEN 1245 -80 1543 350 48
37 DEN SBN 852 24 803 370 50
</TABLE>
-14-
<PAGE> 79
<TABLE>
<CAPTION>
CRUISE
ROUTE AVERAGE EQUIV. PRESSURE
DIST. WINDS STILL AIR ALTITUDE
CASE # FROM TO (NM) (KTS) (NM) (100 FT) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
38 SBN DEN 857 -79 1064 350 50
39 DEN SDF 907 30 842 370 50
40 SDF DEN 935 -86 1183 350 50
41 DEN TYS 1023 32 946 370 50
42 TYS DEN 1046 -87 1329 350 50
43 DEN ASE 97 -41 109 220 50
44 ASE DEN 97 0 97 230 10
45 PHX BHM 1274 36 1168 370 50
46 BHM PHX 1306 -86 1652 350 45
47 PHX BUF 1669 26 1569 330/370 48
48 BUF PHX 1680 -76 2058 350 36
49 PHX BZN 999 -39 1107 370 50
50 BZN PHX 997 -17 1042 350/390 40
51 PHX DAY 1400 28 1308 330/370 50
52 DAY PHX 1408 -79 1745 350 43
53 PHX ELP 330 15 316 370 50
54 ELP PHX 311 -72 384 350 50
55 PHX FAR 1133 -7 1154 370 50
56 FAR PHX 1127 -45 1269 350 50
57 PHX GRR 1381 19 1317 330/370 50
58 GRR PHX 1387 -71 1677 350 45
59 PHX GSO 1676 37 1535 330/370 48
60 GSO PHX 1691 -88 2152 350/390 34
61 PHX GTF 862 -40 957 370 50
62 GTF PHX 860 -15 894 350 50
63 PHX HSV 1260 35 1158 370 50
64 HSV PHX 1285 -85 1623 350 46
65 PHX JAN 1172 34 1080 370 50
66 JAN PHX 1140 -84 1435 350 50
67 PHX MSN 1295 14 1249 370 50
68 MSN PHX 1295 -67 1548 350 48
69 PHX MSO 836 -46 945 350 50
70 MSO PHX 833 -9 853 370 50
71 PHX PNS 1351 36 1239 370 50
72 PNS PHX 1381 -85 1742 350 39
73 PHX RDU 1659 38 1516 330/370 49
74 RDU PHX 1736 -90 2218 350/390 31
75 PHX ROC 1720 26 1616 330/370 47
76 ROC PHX 1728 -76 2121 350/390 35
77 PHX SBN 1321 22 1252 370 50
78 SBN PHX 1332 -74 1625 350 39
79 PHX SDF 1343 30 1249 370 50
80 SDF PHX 1340 -82 1675 350 45
81 PHX TYS 1401 35 1287 30/370 50
82 TYS PHX 1426 -86 1801 350 42
83 PHX DRO 319 -6 324 370 50
</TABLE>
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<PAGE> 80
<TABLE>
<CAPTION>
CRUISE
ROUTE AVERAGE EQUIV. PRESSURE
DIST. WINDS STILL AIR ALTITUDE
CASE # FROM TO (NM) (KTS) (NM) (100 FT) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
84 DRO PHX 310 -53 361 390 38
85 PHX EGE 530 -13 549 370 50
86 EGE PHX 466 -47 529 390 1
87 PHX DSM 1003 12 972 370 50
88 DSM PHX 1011 -67 1210 350 50
89 PHX FAT 484 -67 584 350 50
90 FAT PHX 467 9 456 370 50
91 PHX ASE 426 -11 439 370 50
92 ASE PHX 426 -49 487 390 2
</TABLE>
Section 3.5.5. Mission description. The equivalent still air distance
is the actual route distance (range) corrected for the average winds. Head winds
are negative. 85% average winter winds (Boeing model) have been used.
The maximum take-off weight for each departure airport is based on the
conditions specified in paragraph 2.0 and is in compliance with FAR 25
take-off requirements.
The missions are flown in ISA conditions throughout.
A fixed allowance of fuel dependent on take-off weight is considered
for take-off and acceleration to initial climb speed at 1500 ft above
the airport elevation.
Climb is made starting 1500 ft above the airport elevation to the
initial cruise pressure altitude specified in the table above using a
climb speed schedule of 250 KCAS/ 0.70 M.
Cruise is at the pressure altitude specified in the table at an average
cruise Mach number of 0.74 M. Thrust during cruise is not to exceed
maximum cruise thrust.
When a second cruise pressure altitude is specified in the table, a
4000 ft step climb from the first to the second pressure altitude is
made using a climb speed schedule of 250 KCAS/ 0.70 M. It is followed
by a cruise at the second pressure altitude at an average cruise Mach
number of 0.74 M.
Descent is made from the final cruise pressure altitude to 1500 ft
above the runway elevation using a descent speed schedule of 0.70 M /
250 KCAS.
A fixed allowance of fuel dependent on landing weight is considered for
approach and landing from final descent speed at 1500 ft above the
airport elevation.
Section 3.5.6. Fixed Quantities and Allowances for Payload Guarantees.
For the purpose of this guarantee the following are fixed quantities and
allowances:
-- 9 minutes engine start and taxi-out fuel 120 lb
-- 6 minutes taxi-in fuel (taken from reserves) 80 lb
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<PAGE> 81
-- Usable reserve fuel remaining upon completion of landing phase,
based on the reserve profile specified below:
(1) 100 nm diversion including:
(i) climb from destination airport elevation to
optimum altitude at a speed of 250 KCAS
(ii) cruise at optimum altitude at long range cruise
speed (LRC)
(iii) descent to sea level at a speed of 250 KCAS.
(2) plus fuel equivalent to 45 minutes hold at 10000 feet
at long-range cruise speed (LRC).
The stage length is defined as the sum of the climb, cruise and descent
distances.
M denotes true Mach number.
Block fuel includes engine start, taxi, take-off, climb, cruise,
descent, approach and landing.
The maximum payload guarantees given in 3.5.4 are based on the fixed
estimated Operating Weight Empty (O.W.E.) of 31075 lb and on the
passenger weight allowance of 220 lb.
SECTION 4.0 WEIGHTS
Section 4.1. Maximum Zero Fuel Weight Guarantee. The Maximum Zero Fuel
Weight (M.Z.F.W.) shall not be less than 44000 lb.
Section 4.2. Maximum Landing Weight Guarantee. The Maximum Landing
Weight (M.L.W.) shall not be less than 47000 lb.
Section 4.3. Maximum Take-off Weight Guarantee. The Maximum Take-off
Weight (M.T.O.W.) shall not be less than 53000 lb.
SECTION 5.0. PERFORMANCE GUARANTEE CONDITIONS
Section 5.1. All guaranteed performance data are based on the ICAO
International Standard Atmosphere (ISA) unless noted otherwise. Altitudes are
pressure altitudes.
Section 5.2. Take-off and landing performance are based on the
requirements of FAR 25.
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<PAGE> 82
Section 5.3. Take-off and landing performance guarantees are based on
operation from hard surfaced, level and dry runways with no wind, no obstacles
and no line-up allowance unless noted otherwise and with anti-skid and automatic
spoilers operative.
Section 5.4. When establishing the take-off and second segment
performance, no air shall be bled from the engine(s) for cabin air conditioning
or anti-icing and APR shall be armed and available when one engine fails. The
APU shall be off.
Section 5.5. Speed, specific air range, and the climb, cruise, and
descent portion of the mission guarantee include allowance for normal engine
bleed and power extraction. Normal engine bleed is defined as that bleed
required to maintain a cabin pressure altitude not exceeding 8000 feet at the
maximum operating altitude with an average cabin ventilation rate of not less
than 570 ft3 /min and a cabin temperature of 72F.
Section 5.6. Normal power extraction assumes the use of electrical
services such as to require a power level of 24 Kilowatts, total, to be provided
with both engines operative and of 15 Kilowatts to be provided with one engine
inoperative.
Section 5.7. Fuel density is assumed to be 6.8 pounds / US gallon. All
performance guarantees are based on the use of a fuel with a lower heating value
(LHV) of 18550 BTU / pound and on an Aircraft centre of gravity location of 25%
of the mean aerodynamic chord.
Section 5.8. All guarantees are contingent upon engine acceptance test
performance acceptable to BRAD and are applicable to a new airframe - engine
combination only.
SECTION 6.0. GUARANTEE COMPLIANCE
Section 6.1. Compliance with take-off and landing performance
guarantees shall be demonstrated by reference to the approved FAA Airplane
Flight Manual adjusted to reflect any differences due to change in certification
requirements or interpretation thereof.
Section 6.2. Compliance with speed, specific air range and mission
performance guarantees shall be established by calculations based on three (3)
flight test measurements of specific air range at different altitude, weight and
speed combinations to be agreed by BRAD and Buyer. This compliance will be
obtained for Buyer's Aircraft and will be demonstrated by reference to the
Flight Planning and Cruise Control Manual adjusted to reflect flight test data
measurements.
Section 6.3. A compliance report containing speed and specific air
range performance based on flight test data agreed in 6.2 will be furnished to
Buyer.
Section 6.4. The Aircraft will be weighed as necessary prior to and
after the flight during which performance checks are conducted. The standard
production instrumentation or a special instrumentation system furnished by BRAD
will be used to
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<PAGE> 83
measure speed and specific air range. A fuel sample will be collected prior to
flight to establish density and lower heating value (refer to 5.7).
Section 6.5. If speed and the arithmetic average of three measures of
specific air range data is demonstrated to have achieved compliance with the
performance guarantees no further demonstration will be required.
Section 6.6. Data derived from tests shall be adjusted as required by
conventional methods of correction, interpolation or extrapolation in accordance
with established aeronautical practices to show compliance with the performance
guarantees. In the event that changes are introduced to the Aircraft which
affect the performance guarantees contained herein, BRAD shall adjust the
compliance referred to in paragraph 6.3 above accordingly.
SECTION 7.0. REMEDIES
Section 7.1. In the event a shortfall in the guarantees contained
herein, BRAD reserves the right to carry out additional flight test measurements
on a subsequent Aircraft, which may be specially instrumented for this purpose,
with the objective of identifying accurately the cause of the shortfall and to
develop corrective measures. Such measures shall be developed within a period of
twelve (12) months from discovery and identification of a shortfall (or such
other longer period as may be mutually agreed in view of the corrective measures
involved).
Section 7.2.1. If, during the period commencing at delivery of the
First Aircraft and expiring five (5) years later, Buyer notifies BRAD in writing
that a failure to meet this performance guarantee has occurred, and submits a
claim for direct damages in an amount less [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(iii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(iv) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(v) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
-19-
<PAGE> 84
(vi) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 7.2.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
Section 7.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
SECTION 8.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
SECTION 8.1. THE PERFORMANCE GUARANTEES PROVIDED IN THIS LETTER
AGREEMENT ALONG WITH THE AGREEMENT AND THE OTHER LETTER AGREEMENTS TO THE
AGREEMENT AND THE OBLIGATIONS AND LIABILITIES ON THE PART OF BRAD UNDER THE
AFORESAID GUARANTEES ARE [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
SECTION 8.2. BUYER AND BRAD STATE AND AGREE THAT THIS LETTER HAS BEEN
THE SUBJECT OF DISCUSSION AND NEGOTIATION AND IS FULLY UNDERSTOOD BY THE PARTIES
HERETO AND THAT THE PRICE OF THE AIRCRAFT AND THE OTHER MUTUAL AGREEMENTS OF THE
PARTIES SET FORTH IN THE AGREEMENT WERE ARRIVED AT IN CONSIDERATION OF THE
PROVISIONS CONTAINED HEREIN.
-20-
<PAGE> 85
If the foregoing correctly sets forth your understanding of our
agreement with respect to the above matters, please indicate your acceptance and
agreement below.
Yours truly
BOMBARDIER INC.
________________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this ____ day of January, 1997
MESA AIR GROUP, INC.
By: _______________________________
Title: _____________________________
-21-
<PAGE> 86
APPENDIX A: NOMINAL PERFORMANCE
For flight planning and economic studies purposes, BRAD believes that Nominal
Performance payload can be used. The Nominal Performance relates to performance
level published in the approved FAA Airplane Flight Manual and in the Flight
Planning and Cruise Control Manual applicable to the Customer aircraft.
These Nominal Performances are not guarantees and are not subject to guarantee
compliance specified in paragraph 6.0.
Considering the mission description specified above in 3.5.4 and the fixed
quantities specified above in 3.5.5, the Nominal maximum number of passengers
that can be carried for flight planning purposes is presented in the table below
for each route.
<TABLE>
<CAPTION>
EQUIV.
STILL CRUISE
ROUTE AVERAGE AIR PRESSURE
DIST. WINDS DIST. ALTITUDE NOM.
CASE # FROM TO (NM) (KTS) (nm) (100 ft) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 DRO DEN 224 -13 232 330 41
2 DEN DRO 283 -48 324 350 50
3 DEN EGE 118 -54 139 260 50
4 EGE DEN 130 4 128 270 9
5 DEN BHM 999 29 931 370 50
6 BHM DEN 967 -84 1218 350 50
7 DEN BUF 1190 27 1114 370 50
8 BUF DEN 1196 -79 1482 350 50
9 DEN BZN 589 -67 707 350 50
10 BZN DEN 508 10 494 370 50
11 DEN DAY 964 29 898 370 50
12 DAY DEN 964 -84 1212 350 50
13 DEN ELP 514 -33 561 350 50
14 ELP DEN 534 -28 576 370 50
15 DEN FAR 583 -13 603 370 50
16 FAR DEN 591 -45 667 350 50
17 DEN GRR 890 22 842 370 50
18 GRR DEN 897 -77 1105 350 50
19 DEN GSO 1240 35 1139 370 50
20 GSO DEN 1280 -89 1631 350 47
21 DEN GTF 552 -64 658 350 50
22 GTF DEN 553 8 540 370 50
23 DEN HSV 919 29 856 370 50
24 HSV DEN 928 -86 1174 350 50
25 DEN JAN 883 22 835 370 50
26 JAN DEN 872 -80 1084 350 50
</TABLE>
<PAGE> 87
<TABLE>
<CAPTION>
EQUIV.
STILL CRUISE
ROUTE AVERAGE AIR PRESSURE
DIST. WINDS DIST. ALTITUDE NOM.
CASE # FROM TO (NM) (KTS) (nm) (100 ft) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
27 DEN MSN 753 17 721 370 50
28 MSN DEN 753 -74 921 350 50
29 DEN MSO 616 -68 741 350 50
30 MSO DEN 625 13 604 370 50
31 DEN PNS 1129 24 1064 370 50
32 PNS DEN 1121 -80 1391 350 48
33 DEN RDU 1290 36 1183 370 50
34 RDU DEN 1327 -89 1691 350 46
35 DEN ROC 1236 27 1157 370 50
36 ROC DEN 1245 -80 1543 350 49
37 DEN SBN 852 24 803 370 50
38 SBN DEN 857 -79 1064 350 50
39 DEN SDF 907 30 842 370 50
40 SDF DEN 935 -86 1183 350 50
41 DEN TYS 1023 32 946 370 50
42 TYS DEN 1046 -87 1329 350 50
43 DEN ASE 97 -41 109 220 50
44 ASE DEN 97 0 97 230 10
45 PHX BHM 1274 36 1169 370 50
46 BHM PHX 1306 -86 1652 350 46
47 PHX BUF 1669 26 1569 330/370 49
48 BUF PHX 1680 -76 2058 350 37
49 PHX BZN 999 -40 1108 370 50
50 BZN PHX 997 -17 1042 350/390 41
51 PHX DAY 1400 28 1307 370 50
52 DAY PHX 1408 -79 1745 350 44
53 PHX ELP 330 15 316 370 50
54 ELP PHX 311 -72 384 350 50
55 PHX FAR 1133 -7 1154 370 50
56 FAR PHX 1127 -45 1269 350 50
57 PHX GRR 1381 19 1317 330/370 50
58 GRR PHX 1387 -71 1677 350 46
59 PHX GSO 1676 37 1535 330/370 49
60 GSO PHX 1691 -87 2143 350 35
61 PHX GTF 862 -40 957 370 50
62 GTF PHX 860 -15 894 350 50
63 PHX HSV 1260 35 1158 370 50
64 HSV PHX 1285 -85 1623 350 47
65 PHX JAN 1172 34 1080 370 50
66 JAN PHX 1140 -84 1435 350 50
67 PHX MSN 1295 14 1249 370 50
68 MSN PHX 1295 -67 1548 350 49
69 PHX MSO 836 -46 945 350 50
70 MSO PHX 833 -9 853 370 50
71 PHX PNS 1351 36 1239 370 50
72 PNS PHX 1381 -85 1742 350 40
</TABLE>
A-2
<PAGE> 88
<TABLE>
<CAPTION>
EQUIV.
STILL CRUISE
ROUTE AVERAGE AIR PRESSURE
DIST. WINDS DIST. ALTITUDE NOM.
CASE # FROM TO (NM) (KTS) (nm) (100 ft) PASSENGERS MAX.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
73 PHX RDU 1659 38 1516 330/370 50
74 RDU PHX 1736 -89 2213 350/390 35
75 PHX ROC 1720 26 1617 330/370 48
76 ROC PHX 1728 -76 2117 350 36
77 PHX SBN 1321 22 1252 370 50
78 SBN PHX 1332 -74 1625 350 40
79 PHX SDF 1343 30 1249 370 50
80 SDF PHX 1340 -82 1675 350 46
81 PHX TYS 1401 35 1287 370 50
82 TYS PHX 1426 -86 1801 350 43
83 PHX DRO 319 -6 324 370 50
84 DRO PHX 310 -53 361 390 38
85 PHX EGE 530 -13 549 370 50
86 EGE PHX 466 -47 529 390 2
87 PHX DSM 1003 12 972 370 50
88 DSM PHX 1011 -67 1210 350 50
89 PHX FAT 484 -67 584 350 50
90 FAT PHX 467 9 456 370 50
91 PHX ASE 426 -11 439 370 50
92 ASE PHX 426 -49 487 390 3
</TABLE>
A-3
<PAGE> 89
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-012
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Gentlemen,
Re: Letter Agreement No. 012 [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
Subject: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 1.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 3.0 This Letter Agreement constitutes an integral part of the
Agreement and subject to the terms and conditions contained therein.
Section 4.0 In the event of the termination of the Agreement, this
Letter Agreement shall become automatically null and void.
<PAGE> 90
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
----------------------------------------
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this day of January, 1997
-----
MESA AIR GROUP, INC.
By:
------------------------------------
Title:
------------------------------------
-2-
<PAGE> 91
Wed, Feb. 12, 1997
Our Ref: B96-7701-RJTL-CRJ0351-013
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U. S.A. 87401
Gentlemen,
Re: Letter Agreement No. 013 ([CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]
1.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
2.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
3.0 This Letter Agreement constitutes an integral part of the
Agreement and subject to the terms and conditions contained therein.
4.0 In the event of the termination of the Agreement, this Letter
Agreement shall become automatically null and void.
<PAGE> 92
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
-----------------------------------
Walter Galloway
Director, Contracts
Accepted and Agreed to:
this day of January, 1997
------
MESA AIR GROUP, INC.
By
---------------------------------
Title
---------------------------------
-2-
<PAGE> 93
February 12, 1997
Our Ref: B96-7701-RJTL-CRJ0351-014
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention: Mr. Larry Risley, Chairman
Gentlemen,
Re: Letter Agreement No. 014
(Re: Customer Support, Warranty, and Service Life Policy)
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously with
execution of the Agreement, will become part of the Agreement and will evidence
our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall have
the same meaning as in the Agreement.
CUSTOMER SUPPORT SERVICES AND WARRANTY
The following Customer Support Services and Warranty are those services to
which reference is made in Article 3 of the Agreement.
CUSTOMER SUPPORT SERVICES
ARTICLE 1
TECHNICAL SUPPORT
Section 1.1. Factory Service. BRAD agrees to maintain or cause to be
maintained the capability to respond to Buyer's technical inquiries, to conduct
investigations concerning repetitive maintenance problems and to issue findings
and recommend action thereon. This service shall be provided for as long as
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] aircraft remain in commercial air transport service.
<PAGE> 94
Section 1.2. Field Service Representative.
Section 1.2.1. Services. BRAD shall assign [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] to Buyer's main
base of operation or other location as may be mutually agreed.
Section 1.2.2. Term. Such assignment shall commence approximately one (1)
month prior to the Delivery Date of the first Aircraft and conclude one year
after delivery of the last Firm Aircraft. The FSR assignment may be extended on
terms and conditions to be mutually agreed.
Section 1.2..3 Responsibility. The FSR's responsibility shall be to provide
technical advice to Buyer for the line maintenance and operation of the Aircraft
systems and troubleshooting during scheduled and unscheduled maintenance by
Buyer's designated personnel ("FSR Services").
Section 1.2.4. Travel. If requested by Buyer, the FSR may, at Buyer's
expense, travel to another location to provide technical advice to Buyer.
Section 1.2.5. Office Facilities. Buyer shall furnish the FSR, at no charge
to BRAD, suitable and private office facilities and related equipment including
desk, file cabinet, access to two telephone lines, facsimile and photocopy
equipment conveniently located at Buyer's main base of operation or other
location as may be mutually agreed.
Section 1.2.6. Additional Expenses. Buyer shall reimburse BRAD (net of any
additional taxes on such reimbursement) the amount of any and all taxes (except
Canadian taxes on the income of the FSR) and fees of whatever nature, including
any customs duties, withholding taxes or fees together with any penalties or
interest thereon, paid or incurred by BRAD or the FSR or other BRAD employee as
a result of or in connection with the rendering of the services.
Section 1.2.7. Right to Stop Work. BRAD shall not be required to commence or
continue the FSR Services when:
a.) there is a [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
b.) there exist war, risk of war or warlike operations, riots or
insurrections;
c.) there exist [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] the FSR or other BRAD
employee; or
d.) the Government of the country where Buyer's facilities are
located or where Buyer desires the FSR to travel refuses the BRAD employee
permission to enter said country or Buyer's base of operations.
<PAGE> 95
Section 1.2.8. Work Permits and Clearances. Buyer shall arrange for all
necessary work permits and airport security clearances required for the FSR or
other BRAD employee to permit timely accomplishment of the FSR services.
Section 1.3. Maintenance Planning Support.
Section 1.3.1. Scheduled Maintenance Task Cards. As described in Annex A
Attachment A, BRAD shall provide Buyer BRAD's standard format scheduled
maintenance task cards that shall conform to the Aircraft at the Delivery Date.
At Buyer's request BRAD shall provide a proposal for task cards produced to
Buyer's format.
Section 1.3.2. In-Service Maintenance Data. Buyer agrees to provide to BRAD
in-service maintenance data in order to provide updates to BRAD's recommended
maintenance program. Buyer and BRAD shall agree on standards and frequency for
communication of such data.
Section 1.4. Additional Services. At Buyer's request BRAD shall provide a
proposal to provide such additional support services as the parties may agree
upon, which may include special investigations, maintenance and repair of the
Aircraft.
ARTICLE 2.
SPARE PARTS, GSE, TOOLS AND TEST EQUIPMENT
Section 2.1.1. Definitions.
a. "BRAD Parts": any spare parts, ground support equipment, tools and
test equipment which bear an inhouse Cage Code number in the BRAD Provisioning
Files (as that expression is defined in ATA Specification 2000).
b. "Power Plant Parts": any power plant or power plant part or assembly
carrying the power plant manufacturer's part number or any part furnished by the
power plant manufacturer for incorporation on the Aircraft.
c. "Vendor Parts": any spare parts, ground support equipment, tools and
test equipment for the Aircraft which are not BRAD Parts or Power Plant Parts.
d. "Spare Parts": all materials, spare parts, assemblies, special tools
and items of equipment, including ground support equipment, ordered for the
Aircraft by Buyer from BRAD. The term Spare Parts includes BRAD Parts, Power
Plant Part and Vendor Parts.
e. "Order": any order for Spare Parts issued by Buyer to BRAD; and
f. "Technical Data": shall have the meaning attributed to it in Annex A
Article 4.1.
<PAGE> 96
Section 2.1. Term and Applicability. The term of this Annex A Article 2
shall become effective on the date hereof and shall remain in full force and
effect with respect to the purchase and sale of Spare Parts for each Aircraft so
long as at least [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] remain in commercial air transport service.
The provisions of Annex A Articles 2.2, 2.6.5, 2.24 and Annex B Article 5.0
shall survive expiration or termination of this Agreement.
Section 2.2. Order Terms. Terms and conditions hereof shall apply to all
Orders placed by Buyer with BRAD in lieu of any terms and conditions in Buyer's
purchase orders.
Section 2.3. Purchase and Sale of Spare Parts.
Section 2.3.1. Agreement to Manufacture and Sell. BRAD shall manufacture, or
procure, and make available for sale to Buyer suitable Spare Parts in quantities
sufficient to meet the reasonably anticipated needs of Buyer for normal
maintenance and normal spares inventory replacement for each Aircraft. During
the term specified in Annex A Article 2.1 above, BRAD shall also maintain a
shelf stock of certain BRAD Parts selected by BRAD to ensure reasonable re-order
lead times and emergency support. BRAD shall maintain a reasonable quantity of
BRAD insurance parts. Insurance parts as used herein shall include, but not be
limited to, dispatch-essential parts such as major flight control surfaces.
Section 2.4. Agreement to Purchase BRAD Parts.
Section 2.4.1. Purchase of BRAD Parts. In consideration of BRAD's obligation
under Annex A Article 2.3.1, during the term stated in Annex A Article 2.1.,
Buyer agrees to purchase BRAD Parts [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]:
a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.4.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.4.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.5. Purchase of Vendor Parts & Power Plant Parts. BRAD shall not
be obligated to maintain a stock of Vendor Parts or Power Plant Parts. BRAD may
elect to
<PAGE> 97
maintain a spares stock of selected Vendor Parts at its own discretion to
support provisioning and replenishment sales. BRAD agrees to use reasonable
efforts to require its vendors to comply with the terms and conditions of this
Annex A Article 2 as they apply to Vendor Parts. Vendor Parts shall be delivered
in accordance with the vendor's quoted lead time plus BRAD's internal processing
time.
Section 2.6. Spare Parts Pricing.
Section 2.6.1. Spare Parts Price Catalogue. Prices for commonly used BRAD
Parts stocked by BRAD shall be published in the spare parts price catalogue
("Spare Parts Price Catalogue"). BRAD shall hold the [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
Section 2.6.2. BRAD prices for Vendor Parts. If Buyer orders Vendor Parts
from BRAD, the price shall be as published in the Spare Parts Price Catalogue.
Section 2.6.3. Quotations. Price and delivery quotations for items not
included in the Spare Parts Price Catalogue shall be provided at Buyer's request
by BRAD. Price quotations will be held firm for a period of ninety (90) calendar
days or as otherwise specified by BRAD. Responses to quotation requests will be
provided within ten (10) calendar days.
Section 2.6.4. Price Applicability. The purchase price of BRAD Parts shall be
the applicable price set forth in the Spare Parts Price Catalogue at time of
receipt by BRAD of Buyer's Order or as quoted by BRAD to Buyer upon request. If
Buyer requests accelerated delivery or special handling for BRAD Parts not
included in the Spare Parts Price Catalogue, BRAD may increase the price from
the original quotation to cover any additional costs to BRAD.
Section 2.6.5. Currency and Taxes. All Spare Parts Price Catalogue and
quotation prices shall be in U.S. dollars and exclusive of transportation,
taxes, duties and licenses.
Buyer shall pay to BRAD upon demand the amount of any sales, use,
value-added, excise or similar taxes imposed by any federal, provincial or local
taxing authority within Canada, and the amount of all taxes imposed by any
taxing authority outside Canada, required to be paid by BRAD as a result of any
sale, use, delivery, storage or transfer of any Spare Parts. If BRAD has reason
to believe that any such tax is applicable, BRAD shall separately state the
amount of such tax in its invoice. If a claim is made against BRAD for any such
tax, BRAD shall promptly notify Buyer.
In addition, Buyer shall pay to BRAD on demand the amount of any customs
duties required to be paid by BRAD with respect to the importation by Buyer of
any Spare Parts.
Section 2.6.6. Vendor Pricing. BRAD shall use reasonable efforts to require
its major vendors to maintain any published price for their parts for a period
of at least [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND
<PAGE> 98
EXCHANGE Commission] a ninety (90) calendar day notice period prior to changing
a published price.
Section 2.7. Provisioning.
Section 2.7.1. Pre-provisioning/Provisioning Conference. Pre-provisioning and
provisioning conferences shall be convened on dates to be mutually agreed
between Buyer and BRAD in order to:
(i) discuss the operational parameters to be provided by Buyer to
BRAD which BRAD considers necessary for preparing its quantity
recommendations for initial provisioning of Spare Parts to be purchased
from BRAD or vendors ("Provisioning Items");
(ii) review Buyer's ground support equipment and special tool
requirements for the Aircraft;
(iii) discuss the format of the provisioning documentation to be
provided to Buyer from BRAD for the selection of Provisioning Items; and
(iv) arrive at a schedule of events for the initial provisioning
process, including the establishment of a date for the initial
provisioning conference ("Initial Provisioning Conference") which shall be
scheduled where possible at least twelve (12) months prior to delivery of
the first Aircraft.
The time and location of the pre-provisioning conference shall be mutually
agreed upon between the parties; however, BRAD and Buyer shall use their best
efforts to convene such meeting within thirty (30) days after execution of the
Agreement.
Section 2.8. Initial Provisioning Documentation. Initial provisioning
documentation for BRAD Parts and Vendor Parts shall be provided by BRAD as
follows:
a) BRAD shall provide, as applicable to Buyer, no later than
eighteen (18) months prior to the Scheduled Delivery Date of the first
Aircraft, or as may be mutually agreed, the initial issue of provisioning
files as required by ATA Specification 2000, Chapter 1 (as may be amended
by BRAD);
Revisions to this provisioning data shall be issued by BRAD every
ninety (90) calendar days until ninety (90) calendar days following the
Delivery Date of the last Aircraft or as may be mutually agreed;
b) BRAD shall provide, as required by Buyer, all data files defined
in Chapter 1 of ATA Specification 2000; and
<PAGE> 99
c) the Illustrated Parts Catalogue designed to support provisioning
shall be issued concurrently with provisioning data files and revised at
ninety (90) calendar day intervals.
Section 2.8.1. Obligation to Substitute Obsolete Spare Parts. In the event
that, prior to delivery of the first Aircraft, any Spare Part purchased by Buyer
from BRAD is rendered obsolete or unusable due to the redesign of the Aircraft
or of any accessory, equipment or part thereto (other than a redesign at Buyer's
request), BRAD shall deliver to Buyer new and usable Spare Parts in substitution
for such obsolete or unusable Spare Parts upon return of such Spare Parts to
BRAD by Buyer. BRAD shall credit Buyer's account with BRAD with the price paid
by Buyer for any such obsolete or unusable Spare Part and shall invoice Buyer
for the purchase price of any such substitute Spare Part delivered to Buyer.
Section 2.8.2. Delivery of Obsolete Spare Parts and Substitutes. Obsolete or
unusable Spare Parts returned by Buyer pursuant to Annex A Article 2.8.1. shall
be delivered to BRAD at its plant in Ontario or Quebec, or such other
destination as BRAD may reasonably designate. Spare Parts substituted for such
returned obsolete or unusable Spare Parts shall be delivered to Buyer from
BRAD's plant in Ontario or Quebec, or such other BRAD shipping point as BRAD may
reasonably designate. BRAD shall pay the freight charges for the shipment from
Buyer to BRAD of any such obsolete or unusable Spare Part and for the shipment
from BRAD to Buyer of any such substitute Spare Part.
Section 2.8.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.8.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.8.5. Notification and Format. Buyer shall notify BRAD, in writing,
when Buyer desires to return Provisioning Items which Buyer's review indicates
are eligible for repurchase by BRAD under the provisions of Annex A Article
2.8.3. Buyer's notification shall include a detailed summary, in part number
sequence, of the Provisioning Items Buyer desires to return. Such summary shall
be in the form of listings as may be mutually agreed between BRAD and Buyer, and
shall include part number, nomenclature, purchase order number, purchase order
date and quantity to be returned.
Within five (5) business days after receipt of Buyer's notification BRAD
shall advise Buyer, in writing, when BRAD's review of such summary from Buyer
will be completed.
Section 2.8.6. Review and Acceptance by BRAD. Upon completion of BRAD's
review of any detailed summary submitted by Buyer pursuant to Annex A Article
2.8.5., BRAD shall issue to Buyer a Material Return Authorization notice ("MRA")
for those Provisioning Items BRAD agrees are eligible for repurchase in
accordance with Annex A Article 2.8.3. BRAD will advise Buyer of the reason that
any Provisioning Items included in Buyer's detailed summary are not eligible for
return. The MRA notice shall state the date by which
<PAGE> 100
Provisioning Items listed in the MRA notice must be redelivered to BRAD and
Buyer shall arrange for shipment of such Provisioning Items accordingly.
Section 2.8.7. Price and Payment. The price of each Provisioning Item
repurchased by BRAD pursuant to Annex A Article 2.8.6 will be the original
invoice price thereof. BRAD shall pay the repurchase price by issuing a credit
memorandum in favour of Buyer which may be applied against amounts due BRAD for
the purchase of Spare Parts and services.
Section 2.8.8. Return of Surplus Provisioning Items. Provisioning Items
repurchased by BRAD pursuant to Annex A Article 2.8.6 shall be delivered to BRAD
Free Carrier (Incoterms), at its plant in Ontario or Quebec, or other such
destination as BRAD may reasonably designate.
Section 2.8.9. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
Section 2.9. Procedure for Ordering Spare Parts. Orders for Spare Parts may
be placed by Buyer to BRAD by any method of order placement (including but not
limited to SITA, ARINC, telecopier, letter, telex, facsimile, telephone or hard
copy purchase order).
Section 2.9.1. Requirements. Orders shall include at a minimum order number,
part number, nomenclature, quantity, delivery schedule requested, shipping
instructions and BRAD's price, if available. Buyer agrees that orders placed
with BRAD shall conform to the requirements and procedures contained in ATA
Specification 2000, as applicable to Buyer.
Section 2.9.2. Processing of Orders. Upon acceptance of any Order, unless
otherwise directed by Buyer, BRAD shall, if the Spare Parts are in stock,
proceed immediately to prepare the Spare Parts for shipment to Buyer. If BRAD
does not have the Spare Parts in stock, BRAD shall proceed immediately to
acquire or manufacture the Spare Parts. Purchase order status and actions
related to the shipment of Spare Parts shall be generally consistent with the
provisions of the World Airline Suppliers Guide and the applicable portions of
ATA Specification 2000, as applicable to Buyer.
Section 2.9.3, Changes. BRAD reserves the right, without Buyer's consent, to
make any necessary corrections or changes in the design, part number and
nomenclature of Spare Parts covered by an Order, to substitute Spare Parts and
to adjust prices accordingly, provided that interchangeability is not affected
and the unit price is not increased by more than 10% or $50.00, whichever is
less. BRAD shall promptly give Buyer written notice of corrections, changes,
substitutions and consequent price adjustments. Corrections, changes,
substitutions and price adjustments which affect interchangeability or exceed
the price limitations set forth above may be made only with Buyer's consent,
which consent shall
<PAGE> 101
conclusively be deemed to have been given unless Buyer gives BRAD written notice
of objection within fifteen (15) business days after receipt of BRAD's notice.
In case of any objection, the affected Spare Part will be deemed to be deleted
from Buyer's Order.
Section 2.9.4. Electronic Data Interchange.
Section 2.9.4.1. Use of Electronic Data Interchange (EDI). The SPEC 2000
Protocol shall be used for any EDI transaction.
Buyer and BRAD shall implement security procedures to ensure proper use of
this communication. A message will be considered received only at the point
where it is in a format which can be accepted by the receiving computer
according to ATA SPEC 2000 rules on transmissions. If garbled transmissions are
received, the receiver shall promptly notify the sender through use of the
S1REJECT command.
Section 2.9.4.2. Acceptance of EDI Transactions. The SIBOOKED transaction
creates an obligation on the part of Buyer to purchase the material and
quantities as specified in the transmission. BRAD is obliged to sell the
material and quantities as specified except as may be identified in a subsequent
SIORDEXC message. With respect to a S1QUOTES transaction, Buyer and BRAD are
bound to respect the prices quoted in the transmission in any resultant S1BOOKED
order transaction based upon that S1QUOTES message within the validity period of
the S1QUOTES message. An S1NVOICE message will be considered as the official
commercial invoice for the goods shipped. An S1STOCKS, S1SHIPPD, S1POSTAT or
S1PNSTAT message creates no obligations on either the Buyer or BRAD.
If an S1BOOKED acknowledgment is not sent within 24 hours by BRAD then
Buyer shall resend the original message.
Any document which has been properly received shall not give rise to any
obligation unless and until the party receiving such document has properly
transmitted in return an acknowledgment document according to SPEC 2000
Protocol.
Section 2.9.4.3. Systems Operations. Buyer and BRAD, at their own expense,
shall provide and maintain the equipment, software, services and testing
necessary to effectively and reliably transmit and receive documents.
Section 2.9.4.4. Validity of Documents. Annex A Article 2.9.4 has been agreed
to by Buyer and BRAD to evidence their mutual intent to create binding purchase
and sale obligations pursuant to the electronic transmission and receipt of
documents as described herein.
Such documents properly transmitted pursuant to this Annex A Article 2.9.4
shall be considered, in connection with any transaction or any other agreement,
to be a "writing" or "in writing" and shall be deemed for all purposes (a) to
have been "signed" and (b) to constitute an "original" when printed from
electronic files or records established and maintained in the normal course of
business.
<PAGE> 102
Buyer and BRAD agree not to contest the validity or enforceability of
signed documents under the provisions of any applicable law relating to whether
certain agreements are to be in writing or signed by either party to be bound
thereby. Signed documents, if introduced as evidence on paper in any judicial,
arbitration, mediation or administrative proceedings, will be admissible as
between Buyer and BRAD to the same extent and under the same conditions as other
business records originated and maintained in documentary form. Neither Buyer
nor BRAD shall contest the admissibility of copies of signed documents under
either the business records exception to the hearsay rule or the best evidence
rule on the basis that the signed documents were not originated or maintained in
documentary form.
Section 2.9.4.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.10. Packing. All Spare Parts ordered shall receive standard
commercial packing suitable for export shipment via air freight. Such standard
packing will generally be to ATA 300 standards as amended from time to time. All
AOG orders will be handled, processed, packed and shipped separately.
Section 2.11. Packing List. BRAD shall insert in each shipment a packing
list/release note itemized to show:
(i) the contents of the shipment,
(ii) the approved signature of BRAD's TC authority attesting to the
airworthiness of the Spare Parts.
(iii) value of the shipment for customs clearance if required.
Section 2.12. Container Marks. Upon Buyer's request each container shall be
marked with shipping marks as specified on the Order. In addition BRAD shall,
upon request, include in the markings: gross weight and cubic measurements.
Section 2.13. Delivery, Title and Risk of Loss.
Section 2.13.1. Delivery Point. Spare Parts shall be delivered to Buyer in one
of the following manners at BRAD's sole option:
(i) Free Carrier (Incoterms 1990) BRAD's plant in either Ontario or
Quebec, Canada; or
(ii) Free Carrier (Incoterms 1990) other BRAD depots or shipping
points; or
(iii) Free Carrier (Incoterms 1990) vendor's or subcontractor's plant.
<PAGE> 103
Section 2.13.2. Delivery Time. BRAD shall use reasonable efforts so that
shipment of BRAD Parts to Buyer be as follows:
a) AOG Orders. Ship AOG Orders within four (4) hours of receipt of Order.
Buyer's affected Aircraft factory production number shall be required on AOG
Orders;
b) Critical Orders (A1), Ship critical Orders within twenty-four (24)
hours of order receipt;
c) Expedite Orders (A2) Ship expedite Orders within seven (7) calendar
days of order receipt;
d) Initial Provisioning Order. Prior to the Delivery Date of the first
Aircraft or as may be mutually agreed; and
e.) Other Orders Shipment of stock items shall be approximately thirty
(30) calendar days after BRAD's receipt of Buyer's Order. Shipment of non-stock
items shall be in accordance with quoted lead times or lead times published in
the current Spare Parts Price Catalogue, procurement data, or provisioning data.
Section 2.14. Collect Shipments. Where collect shipments are not deemed
practicable by BRAD, charges for shipment, insurance, prepaid freight charges
and all other costs paid by BRAD shall be paid by Buyer promptly upon
presentation to Buyer of invoices covering the same.
Section 2.15. Freight Forwarder. If Buyer elects to use the services of a
freight forwarder for the onward movement of Spare Parts, Buyer agrees to
release BRAD from and indemnify it for any liability for any fines or seizures
of Spare Parts imposed under any governmental Goods in Transit regulations. Any
such fines levied against BRAD will be invoiced to Buyer and any Spare Parts
seized under such regulations will be deemed to be received, inspected, and
accepted by Buyer at the time of seizure.
Section 2.16. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.17. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
BRAD agrees to notify Buyer when material is shipped and shall provide
carrier's reference information (i.e., waybill number).
Section 2.18. Inspection and Acceptance. All Spare Parts shall be subject to
inspection by Buyer at destination. Use of Spare Parts or failure of Buyer to
give notice of rejection within thirty (30) days after receipt shall constitute
acceptance. Acceptance shall be final and Buyer waives the right to revoke
acceptance for any reason, whether or not
<PAGE> 104
known to Buyer at the time of acceptance. Buyer's remedies for defects
discovered before acceptance are exclusively provided for in Annex A Article
2.19 herein.
Section 2.19. Rejection. Any notice of rejection referred to in Annex A
Article 2.18 shall specify the reasons for rejection. If BRAD concurs with a
rejection, BRAD shall, at its option, correct, repair or replace the rejected
Spare Parts. Buyer shall, upon receipt of BRAD's written instructions and
Material Return Authorication ("MRA") number, return the rejected Spare Parts to
BRAD at its specified plant, or other destination as may be mutually agreeable.
The return of the rejected Spare Parts to BRAD and the return or delivery of a
corrected or repaired rejected Spare Part or any replacement for any such Spare
Part to Buyer shall be at BRAD's expense. Any corrected, repaired or replacement
Spare Parts shall be subject to the provisions of this Agreement.
Section 2.20. Payment Except as provided in Annex A Article 2.22 below,
payment terms shall be net thirty (30) calendar days of invoice date for
established open accounts. Any overdue amount shall bear interest from the due
date until actual payment is received by BRAD at an annual rate of interest
equal to the [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.21. Payment for Provisioning Items. Payment for Provisioning Items
shall be made by Buyer as follows:
a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] of the total price of the Provisioning
Items as selected by Buyer, upon signature of the spares provisioning
document; and
b) the balance of the total price of Provisioning Items upon their
delivery.
Section 2.22. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
(i) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(ii) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.23. Regulations. Buyer shall comply with all applicable monetary
and exchange control regulations and shall obtain any necessary authority from
the governmental agencies administering such regulations to enable Buyer to make
payments at the time and place and in the manner specified herein.
Section 2.24. Warranty. ANNEX B hereto exclusively sets forth BRAD'S
warranty obligations with respect to spare parts. Except as expressly set out in
Annex B, there are no understandings, representations, conditions or warranties,
express or implied, between the
<PAGE> 105
parties with respect to any defect in the spare parts or any other thing
delivered under this Agreement.
Section 2.25. Cancellation of Orders. Except as otherwise may apply to
initial provisioning, if Buyer cancels an Order, BRAD, at its option, shall be
entitled to recover actual damages, but not less than the following cancellation
charges or more than the purchase price of the Spare Parts covered by the Order:
a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 2.2.6. Lease. BRAD shall select and make available certain parts for
lease, subject to availability Buyer has the option to negotiate a lease
agreement with BRAD separate from this Agreement.
Section 2.27. Additional Terms and Conditions. BRAD's conditions of sale are
deemed to incorporate the terms and conditions stated herein. Additional terms
and conditions applicable at time of receipt of each order from Buyer may be
added providing such terms and conditions do not conflict with the terms and
conditions provided herein. Such additional terms and conditions shall be
provided to Buyer at least ninety (90) calendar days prior to their effective
date.
ARTICLE 3
TRAINING
Section 3.1. General Terms.
Section 3.1.1. The objective of the training programs (the "Programs"), as
described herein, shall be to familiarize and assist Buyer's personnel in the
introduction, operation, and maintenance of the Aircraft.
BRAD shall offer to the Buyer the Programs in the English language at a
BRAD designated facility; the Programs shall be completed prior to the Delivery
Date of the last Aircraft purchased herein.
Section 3.1.2. Buyer shall be responsible for all travel and living expenses,
including local transportation, of Buyer's personnel incurred in connection with
the Programs.
<PAGE> 106
Section 3.1.3 The Programs shall be designed to reflect the model and/or
configuration of the Aircraft and may include differences training to identify
such configuration or model. Manuals which are provided during the Programs
exclude revision service.
Section 3.1.4. A training conference shall be held where possible no later
than twelve (12) months prior to the Scheduled Delivery Date of the first
Aircraft to the Buyer, or as may be otherwise agreed, to establish the Programs'
content and schedule.
Section 3.2. Flight Crew Training.
Section 3.2.1. Flight Crew Ground Training. [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION], BRAD will provide
with each delivered Aircraft, a TC or FAA approved transition training for
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] who meet the minimum entry requirement provided in the
applicable training manual. Each course shall consist of up to eighty (80) hours
of classroom instruction which may include part task trainer, Computer Based
Training (CBT), and/or Flight Training Device (FTD). BRAD shall furnish each of
Buyer's licensed pilots attending the course one copy of the Flight Crew
Operating Manual.
Section 3.2.2. Pilot Simulator Training. BRAD shall provide access at
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] to a TC or FAA approved flight simulator for the crew
trained under Annex A Article 3.2.1. BRAD shall provide a simulator instructor
for [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] for the crew trained on BRAD's designated simulator in
Montreal; each mission shall consist of [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] in the simulator and
required briefing/debriefing sessions.
Section 3.2.3. In-flight Training. Should Buyer require aircraft flight
training, such training shall be conducted in Buyer's Aircraft after the
Delivery Date for up to a maximum [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of Buyer's pilots. BRAD
shall provide an instructor pilot at no additional charge; Buyer shall be
responsible for the cost of fuel, oil, landing fees, taxes, insurance,
maintenance, and other associated operating expenses required for the Aircraft
during such training.
Section 3.2.4. Flight Attendant Course. A familiarization course for up to
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] of Buyer's flight attendant personnel shall be conducted.
Each course shall be for a maximum [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] working days duration.
This course shall present general information on the Aircraft and detailed
information on the operation of the passenger safety equipment and emergency
equipment. BRAD shall furnish for each participant in this course one (1) copy
of the Flight Attendant Training Guide which shall
<PAGE> 107
not be revised. Buyer shall assist BRAD in the development of the Flight
Attendant Training Guide to incorporate Buyer's specific equipment and
procedures.
Section 3.2.5. Flight Dispatcher Course. A course for up to [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] of Buyer's flight dispatch personnel shall be conducted. Each course
shall be for a maximum of [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] days duration. The course shall
consist of classroom instruction covering general Aircraft familiarization,
coverage of performance, flight planning, weight and balance and the Minimum
Equipment List. BRAD shall furnish for each participant in this course one (1)
copy of the Flight Crew Operating Manual which shall not be revised.
Section 3.2.6. Recurrent Pilot Training. BRAD shall, upon Buyer's request,
provide a proposal for a TC or FAA approved course for type rated pilots,
customized in content to meet the recurrent training of Buyer's pilots.
Section 3.2.7. Course Training Material. BRAD shall, upon Buyer's request,
present a proposal to provide one (1) set of the materials (without revision
service) used to conduct the Flight Crew Ground Training course, as follows:
i) 35 mm slides;
ii) Instructional Narrative and/or Instruction Guides;
iii) Overhead Projection Transparencies;
iv) Motion picture and/or Video tapes; and
v) Audio cassettes tapes.
Section 3.3. Maintenance Training.
Section 3.3.1. Airframe and Powerplant Systems Maintenance Course. BRAD
shall, [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE Commission], train up to [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of Buyer's qualified
personnel per Aircraft. This course shall emphasize detailed systems
description, operation, and routine line maintenance practices. The course
material shall be principally mechanical with electrical and avionics
information for overall systems comprehension. The course duration shall be for
a maximum of [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 3.3.2. Electrical and Avionics Systems Maintenance Course. BRAD
shall, [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION], train up to [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of Buyer's qualified
<PAGE> 108
personnel per Aircraft. The course shall emphasis detailed systems description,
operation and routine line maintenance practices. The course material shall be
principally electrical and avionic but shall include mechanical information for
overall systems comprehension. The course duration shall be for a maximum of
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
Section 3.3.3. Ground Handling Course. BRAD shall, [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of
Buyer's qualified personnel per Aircraft. This course shall provide ramp service
personnel with training to be able to tow and park Aircraft and perform routine
ramp servicing tasks. Such training shall be conducted in class with a practical
demonstration on Buyer's Aircraft after acceptance. The course duration shall be
a maximum [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] days and the practical demonstration shall not exceed
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] working days.
Section 3.3.4, General Familiarization Course. BRAD shall, [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION], train up to [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] of Buyer's personnel. The course shall
generally describe the Aircraft, the systems and the maintenance and support
requirements. This course is primarily designed for Buyer's facilities planning,
parts provisioning and aircraft management personnel. The course duration is for
a [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE Commission] working days.
Section 3.3.5. Engine Run-up Course. BRAD shall provide an Engine Run-up
course, [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE Commission], for up to [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of Buyer's qualified
personnel. This course enables Buyer's personnel to gain proficiency in engine
and APU runs, cockpit management procedures , malfunctions and exceedences. A
prerequisite for this course is satisfactory completion of the Airframe and
Powerplant Systems Maintenance course. The course duration shall be for a
maximum of [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] working days.
Section 3.3.6. Specialist Courses. At Buyer's request, BRAD shall make a
proposal for specialist courses which will be derived from BRAD's standard
courses detailed herein.
Section 3.3.7. Recurrent Training. At Buyer's request, BRAD shall make a
proposal for a Regulatory Authority approved training plan for maintenance
recurrent training.
Section 3.3.8. Vendor Training. At Buyer's request, BRAD shall assist Buyer
to obtain vendor maintenance training.
<PAGE> 109
Section 3.3.9. Course Training Material. BRAD, upon Buyer's request, shall
present a proposal to provide one (1) set of the training materials (without
revision service) used to conduct BRAD's standard training as detailed herein:
i) 35 mm slides;
ii) Lesson Guides;
iii) Overhead Projection Transparencies;
iv) Motion picture and/or Video tapes; and
v) Audio cassettes tapes.
Section 3.4. Insurance.
Section 3.4.1. Buyer shall at all times during flight training in Buyer's
Aircraft secure and maintain in effect, at its own expense, insurance policies
covering the Aircraft including without limitation:
a) liability insurance covering public liability, passenger, crew,
property and cargo damage in amounts not less than [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
for any single occurrence;
b) all risk aircraft hull and engine insurance for an amount which
is not less than [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION].
Section 3.4.2. The liability policy shall name BRAD (and its affiliates) as
additional insured. The hull policy shall contain a waiver of subrogation in
favour of BRAD (and its affiliates). All insurance policies shall provide for
payments despite any misrepresentations or breach of warranty by any person
(other than the assured receiving payments) and shall not be subject to any
offset by any other insurance carried by BRAD except that Buyer shall not be
required to provide insurance with respect to the manufacturing, repair and
maintenance activities of BRAD (and of its affiliates) and the related potential
liability (product or otherwise) arising therefrom.
ARTICLE 4
TECHNICAL DATA
Section 4.1. Technical Data Provided. BRAD shall furnish to Buyer the
Technical Data described in Attachment A hereto (the "Technical Data"). The
Technical Data shall be in the English language and shall provide information on
items manufactured according to BRAD's detailed design and in those units of
measures used in the Specification or as may otherwise be required to reflect
Aircraft instrumentation as may be mutually agreed.
<PAGE> 110
Section 4.2. Shipment. All Technical Data provided hereunder shall be
delivered to Buyer Free Carrier (Incoterms) BRAD's designated facilities and at
the time indicated in Attachment A.
Section 4.3. Proprietary Technical Data. It is understood and Buyer
acknowledges that the Technical Data provided herein is proprietary to BRAD and
all rights to copyright belong to BRAD and the Technical Data shall be kept
confidential by Buyer. Buyer agrees to use the Technical Data solely to
maintain, operate, overhaul or repair the Aircraft or to make installation or
alteration thereto allowed by BRAD.
Technical Data shall not be disclosed to third parties or used by Buyer or
furnished by Buyer for the design or manufacture of any aircraft or Spare Parts
including BRAD Parts or items of equipment, except when manufacture or redesign
is permitted under the provisions of Annex A Article 2.4 hereof and then only to
the extent and for the purposes expressly permitted therein, and provided
further the recipient shall provide a non-disclosure undertaking acceptable to
BRAD.
ATTACHMENT A
LIST OF TECHNICAL DATA
COLUMN HEADING EXPLANATION OF CODES
<TABLE>
<CAPTION>
ITEM DOC DOCUMENT
<S> <C> <C>
1
Title of Technical Data provided.
2 Config Configuration
G = Contains data common to all aircraft of the same
type (Generic). C = Contains data unique to Buyer's
Aircraft (Customized).
3 Medium Buyer selects one of the following media specified in the table:
1 = Print two sides
2 = Microfilm
3 = Print one side
4 = Laminated Cardboard
4 Revision Y = Periodic revision service applies
N = Revision service not applicable
S = Revised as required by BRAD
5 Quantity
(Number = Quantity per the Agreement
(Number) Per = Quantity per Aircraft
6 Delivery
ATD = At time of the Delivery Date of the first Aircraft.
</TABLE>
<PAGE> 111
<TABLE>
<S> <C> <C>
PTD = Prior to the Delivery Date of each or
the first Aircraft (as applicable).
7 ATA Y = Document is per ATA Specification 100, Revision 26.
N = Document is to BRAD's existing commercial practices.
</TABLE>
With the delivery of the first Aircraft, BRAD will provide to Buyer at no
additional charge one set of the technical manuals listed below
<PAGE> 112
TECHNICAL DATA
REGIONAL JET
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
ITEM DOC CONF MEDIUM QTY REV DEL ATA REMARKS
S
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1. Aircraft Maintenance Manual (AMM) G 1, 2 1 Y PTD Y
- ---------------------------------------------------------------------------------------
2. Illustrated Parts Manual/Catalog G 1, 2 1 Y PTD Y
(IPC)
- ---------------------------------------------------------------------------------------
3. Structural Repair Manual (SRM) G 1, 2 1 Y PTD Y
- ---------------------------------------------------------------------------------------
4. Component Maintenance Manual (CMM) G 1, 2 1 Y PTD Y
- ---------------------------------------------------------------------------------------
5. Power Plant Build-Up Manual G 1, 2 1 Y PTD Y
- ---------------------------------------------------------------------------------------
6. Wiring Diagram Manual C 1, 2 1 Y PTD Y
- ---------------------------------------------------------------------------------------
7. Illustrated Tool & Equipment G 1, 2 1 Y PTD Y
Manual (ITEM)
- ---------------------------------------------------------------------------------------
8. Service Bulletins G 1 1 S PTD Y See
Note 2
- ---------------------------------------------------------------------------------------
9. Non Destructive Test Manual (NDT) G 1 1 Y PTD Y
- ---------------------------------------------------------------------------------------
10. Maintenance Program Document (MPD) G 1 3 S PTD Y See
Note 3
- ---------------------------------------------------------------------------------------
11. Faa or Dot Airplane Flight Manual C 1 1 PER S ATD N
(AFM)
- ---------------------------------------------------------------------------------------
12 Weight & Balance Manual G 1 1 Y ATD Y
- ---------------------------------------------------------------------------------------
13 Master Minimum Equipment List G 1 1 S ASAP N
(MMEL)
- ---------------------------------------------------------------------------------------
14 Quick Reference Handbook C 1 1 PER S ATD N
- ---------------------------------------------------------------------------------------
15. Flight Crew Operating Manual C 1 4 S ATD N See
(FCOM) Note 1
- ---------------------------------------------------------------------------------------
16. Maintenance Task Cards C 3 3 S PTD N
- ---------------------------------------------------------------------------------------
17. Access Panels And Doors/Component G 1 2 N PTD N
Location Manual
- ---------------------------------------------------------------------------------------
18. Flight Planning & Cruise Control G 1 2 S ASAP N
Manual
- ---------------------------------------------------------------------------------------
19. Aircraft Characteristics For G 1 2 N ASAP N See
Airport Planning Note 4
- ---------------------------------------------------------------------------------------
20. On-Board Wiring Diagram Book C 3 A/R N ATD N See
Note 5
- ---------------------------------------------------------------------------------------
21. Maintenance Facilities & Equipment G 1 2 S ASAP N
Planning Manual
- ---------------------------------------------------------------------------------------
22. System Schematic Manual (SSM) G 1, 2 1 Y ATD Y See
Note 1
- ---------------------------------------------------------------------------------------
23. Passenger Information Sheet G 3 1 S ATD N See
Note 6
- ---------------------------------------------------------------------------------------
24. Pilot Checklist C 4 1 PER S ATD N
- ---------------------------------------------------------------------------------------
25. Crash Crew Chart G 4 1 PER S ATD N
- ---------------------------------------------------------------------------------------
26. Dispatch Deviation Guide G 1 1 S PTD N
- ---------------------------------------------------------------------------------------
</TABLE>
<PAGE> 113
NOTE 1: REVISION SERVICE
A. Revision services shall only be available for six (6) months following
the Delivery Date of Buyer's last Aircraft. Subsequent revision service shall be
provided dependent upon incorporation of BRAD issued Service Bulletins.
B. Revisions to the Technical Data to reflect the Aircraft at Delivery
Date shall be provided to Buyer within six (6) months following the Delivery
Date of each of the Aircraft, respectively.
C. Provided the revision service is being supplied under the terms of
this Agreement or by subsequent purchase order, BRAD shall incorporate in the
applicable documents all applicable BRAD originated Service Bulletins in a
regular revision following formal notification by Buyer that such Service
Bulletins shall be accomplished on the Buyer's Aircraft. The manuals shall then
contain both original and revised configuration until Buyer advises BRAD in
writing that one configuration is no longer required.
NOTE 2: SERVICE BULLETINS
Aperture cards of the service drawing(s) will be provided in lieu of
drawings when practical.
NOTE 3: MAINTENANCE PROGRAM DOCUMENT
This manual provides the basis for Buyer's initial maintenance program.
NOTE 4: AIRCRAFT CHARACTERISTICS FOR AIRPORT PLANNING
This manual contains data on Aircraft ground maneuver and handling.
NOTE 5: ON-BOARD WIRING DIAGRAM BOOK
This book contains wiring diagrams for interim reference until the Wiring
Diagram Manual is revised to reflect the Aircraft at the Delivery Date.
NOTE 6: PASSENGER INFORMATION CARDS
BRAD will provide one (1) reproducible master for the preparation of
passenger information cards. For an additional cost, subject to negotiation,
BRAD will provide full colour laminated passenger information cards in
quantities required.
<PAGE> 114
WARRANTY AND SERVICE LIFE POLICY
ARTICLE 1
WARRANTY
The following warranty is that to which reference is made in Article 3 of
the Agreement.
Section 1.1. Warranty.
Section 1.1.1. Subject to Annex B Articles 1.9, 1.10, and 2.0, BRAD warrants
that, at the date of delivery of the Aircraft or BRAD Part, as applicable :
a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
d.) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 1.1.2. The Warranty set forth in Annex B Article 1.1.1 (c) and (d)
above shall also be applicable to BRAD Parts purchased as Spare Parts.
Section 1.1.3. BRAD further warrants that, at the time of delivery, the
Technical Data shall be free from error.
Section 1.2. Warranty Period
Section 1.2.1. The Warranty set forth in Annex B Article 1.1 shall remain in
effect for any defect covered by the Warranty (a "Defect") becoming apparent
during the following periods (individually, the "Warranty Period"):
a) for failure to conform to the Specification and in the
installation referred to in Annex B Article 1.1.1 (a) and 1.1.1 (b),
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] from the Delivery Date;
b) for those Defects in material or workmanship in BRAD Parts
referred to in Annex B Article 1.1.1 (c) and 1.1.2, [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
from the date of delivery of such parts;
<PAGE> 115
c) for those Defects in design referred to in Annex B Article 1.1.1
(d), [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] from the date of delivery of such
parts; and
d) for errors in the Technical Data referred to in Annex B Article
1.1.3, [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] from the date of delivery of the
applicable Technical Data.
Section 1.3. Repair, Replacement or Rework.. As to each matter covered by
this Warranty BRAD's sole obligation and liability under this Warranty is
expressly limited to, at BRAD's election, correction by the repair, replacement
or rework of the defective part or item of Technical Data. The repaired,
replaced or reworked part or item of Technical Data which is the subject of the
Warranty claim shall then be warranted under the same terms and conditions for
the then unexpired portion of the Warranty Period.
In the case of a Defect relating to non-conformance with the
Specification, BRAD shall correct that Defect in the equipment item or part in
which the Defect appears, except that BRAD will not be obligated to correct any
Defect which has no material adverse effect on the maintenance, use or operation
of the Aircraft.
Section 1.4. Claims Information.. BRAD's obligations hereunder are subject
to a Warranty claim to be submitted in writing to BRAD's warranty administrator,
which claim shall include but not be limited to the following information:
a) the identity of the part or item involved, including the Part
number, serial number if applicable nomenclature and the quantity claimed
to be defective;
b) the manufacturer's serial number of the Aircraft from which the
part was removed;
c) the date the claimed Defect became apparent to Buyer;
d) the total flight hours (and cycles if applicable) accrued on the
part at the time the claimed Defect became apparent to Buyer; and
e) a description of the claimed Defect and the circumstances
pertaining thereto.
Section 1.5. BRAD's Approval. Within ten (10) working days following
receipt of Buyer's Warranty claim for a Defect accompanied by Buyer's request
for permission as applicable to correct a Defect, BRAD shall notify Buyer of its
decision on the request. Approval under this Article shall not constitute a
determination as to the existence of a Defect as described in Annex B Article
1.1 above.
<PAGE> 116
Section 1.6. Timely Corrections. BRAD shall make the repair, replacement or
rework, following receipt of the defective part or item, with reasonable care
and dispatch.
Section 1.7. Labour Reimbursement. For correction of Defects BRAD shall
establish a reasonable estimate for the labour hours required for the repair,
replacement or rework of the defective BRAD Part and, if the repair, replacement
or rework is performed by Buyer, BRAD shall reimburse Buyer for BRAD estimated
hours or for Buyer's actual labour hours, whichever is less, for the repair,
replacement or rework of the defective BRAD Part excluding any work necessary to
gain access to said BRAD Part. Such reimbursement shall be based upon Buyer's
direct labour rate per manhour plus burden rate of fifty percent (50%), subject
to annual review and adjustment of such labour rate as mutually agreed;
provided, however, that this amount shall not exceed fifty percent (50%) of the
BRAD published selling labour rate.
Section 1.8. Approval, Audit, Transportation and Waiver. All Warranty
claims shall be subject to audit and approval by BRAD. BRAD will use reasonable
efforts to advise in writing the disposition of Buyer's Warranty claim within
thirty (30) days following the receipt of the claim and (if requested) return of
the defective BRAD Part to BRAD's designated facility. BRAD shall notify Buyer
of BRAD's disposition of each claim.
Buyer shall pay all costs of transportation of the defective part from
Buyer to BRAD and shall pay all costs of transportation of the repaired,
corrected or replacement parts back to Buyer.
Section 1.9. Limitations.
Section 1.9.1. BRAD shall be relieved of and shall have no obligation or
liability under this Warranty if:
a) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
b) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
c) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 117
e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
Section 1.9.2. The above warranties do not apply to Buyer Furnished
Equipment.
Section 1.10. Normal Usage. Normal wear and tear and the need for regular
maintenance and overhaul shall not constitute a Defect or failure under this
Warranty.
Section 1.11. Overhaul of Warranty Parts. BRAD's liability for a BRAD Part
which has a Defect and is overhauled by Buyer within the Warranty Period shall
be limited only to that portion of the labour and material replacement related
to the Defect.
Section 1.12. No Fault Found. In the event that a BRAD Part returned under a
Warranty claim is subsequently established to be serviceable then BRAD shall be
entitled to charge and recover from Buyer any reasonable costs incurred by BRAD
in connection with such Warranty claim. Providing, however, in the event that
repetitive in-service failure occurs on the particular BRAD Part which is
subsequently identified by BRAD on a repeated basis to be "no fault found," then
BRAD and Buyer shall discuss and mutually agree a course of further action to
help identify the problem. In the event the fault is ultimately confirmed to be
a legitimate Warranty claim then the above mentioned costs incurred by BRAD and
charged to Buyer shall be waived.
ARTICLE 2.
VENDOR WARRANTIES
Section 2.1. Warranties from Vendors. The Warranty provisions of this Annex
B apply to BRAD Parts only. However, BRAD has made or shall make reasonable
efforts to obtain favourable warranties from vendors, with respect to Vendor
Parts and Power Plant Parts. Except as specifically provided under this Annex B
Article 2, BRAD shall have no liability or responsibility for any such Vendor
Parts and Power Plant Parts and the warranties for those Vendor Parts and Power
Plant Parts shall be the responsibility of the vendor and a matter as between
Buyer and vendor.
Section 2.2. Vendor Warranty Backstop. For those Vendor Parts installed on
the Aircraft at the Delivery Date or subsequently purchased through BRAD,
excluding the Powerplant or the Power Plant Parts, in the event the parties
agree that a vendor is in default in the performance of any material obligation
under any applicable warranty obtained by BRAD from such vendor pursuant to
Annex B Article 2.1 above, the warranties and all other terms and conditions of
Annex B Article 1 shall become applicable as if the Vendor Parts had been a BRAD
Part, except that the warranty period shall be the Warranty Period as set forth
herein or by the vendor's warranty, whichever is shorter and all transportation
costs associated with the Vendor Parts shall be borne by Buyer.
<PAGE> 118
Section 2.3. BRAD's Interface Commitment. In the event of a dispute in the
application of a Vendor Part warranty, at Buyer's request addressed to BRAD's
warranty administrator, BRAD shall, without charge, conduct an investigation and
analysis of any such dispute resulting from a technical interface problem to
determine, if possible, the cause of the interface problem and then recommend
feasible corrective action. Buyer shall furnish to BRAD all data and information
in Buyer's possession relevant to the interface problem and shall cooperate with
BRAD in the conduct of its investigation and such tests as may be required.
BRAD, at the conclusion of its investigation, shall advise Buyer in writing of
BRAD's opinion as to the cause of the problem and BRAD's recommended corrective
action.
ARTICLE 3.
SERVICE LIFE POLICY
Section 3.1. Applicability. The Service Life Policy ("SLP") described in
this Annex B Article 3 shall apply if fleetwide and repetitive failures occur in
any Covered Component which is defined in Annex B Article 3.7 below.
Section 3.2. Term.
Section 3.2.1. Should such failures occur in any Covered Component within
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] following delivery of the Aircraft containing such Covered
Component, BRAD shall, as promptly as practicable and at its option;
a) design and/or furnish a correction for such failed Covered
Component; or
b) furnish a replacement Covered Component (exclusive of standard
parts such as bearings, bushings, nuts, bolts, consumables and similar low
value items).
Section 3.3. Price. Any Covered Component which BRAD is required to furnish
under this SLP shall be provided for at a price calculated in accordance with
the following formula:
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION];
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
<PAGE> 119
Section 3.4. Conditions and Limitations.
Section 3.4.1. The following general conditions and limitations shall apply
to the SLP:
a) the transportation cost for the return to BRAD's designated
facility, if practicable, of any failed Covered Component necessary for
failure investigation or redesigning studies shall be borne by Buyer;
b) BRAD's obligations under this SLP are conditional upon the
submission of reasonable proof acceptable to BRAD that the failure is
covered hereby;
c) Buyer shall report any failure of a Covered Component in writing
to BRAD`s Warranty administrator within two (2) months after such failure
becomes evident. Failure to give this required notice shall excuse BRAD
from all obligations with respect to such failure;
d) the provisions of Annex B Article 1.9 of the Warranty (except
for subparagraphs (d) and (e) thereof) are incorporated by this reference
and shall condition BRAD's obligations under this SLP with respect to any
Covered Component;
e) BRAD's obligations under this SLP shall not apply to any
Aircraft which has not been correctly modified in accordance with the
specifications or instructions contained in the relevant Service Bulletins
which are furnished to Buyer prior to receipt by BRAD from Buyer of any
notice of an occurrence which constitutes a failure in a Covered
Component. The provisions of this subparagraph shall not apply in the
event that Buyer furnishes reasonable evidence acceptable to BRAD that
such failure was not caused by Buyer's failure to so modify the Aircraft;
f) this SLP shall not apply to a failure of a Covered Component if
BRAD determines that such failure may not reasonably be expected to occur
on a fleetwide and repetitive basis; and
g) this SLP shall not apply to a Covered Component where the
failure results from an accident, abuse, misuse, degradation, negligence
or wrongful act or omission, unauthorized repair or modification adversely
affecting a Covered Component, impact or foreign object damage, to any
Covered Component.
Section 3.5. Coverage. This SLP is neither a warranty, performance
guarantee nor an agreement to modify the Aircraft to conform to new developments
in design and manufacturing art. BRAD's obligation is only to provide correction
instructions to correct a Covered Component or furnish replacement at a reduced
price as provided in this SLP.
Section 3.6. Assignment. Buyer's rights under this SLP shall not be
assigned, sold, leased, transferred or otherwise alienated by contract,
operation of law or otherwise, without BRAD's prior written consent. Any
unauthorized assignment, sale, lease, transfer,
<PAGE> 120
or other alienation of Buyer's rights under the SLP shall immediately void all
of BRAD's obligations under the SLP.
Section 3.7. Covered Component. Only those items or part thereof listed in
Attachment A to this Annex B shall be deemed to be a Covered Component, and
subject to the provisions of this SLP.
ARTICLE 4
GENERAL
Section 4.1. It is agreed that BRAD shall not be obligated to provide to
Buyer any remedy which is a duplicate of any other remedy which has been
provided to Buyer under any other part of this Annex B.
ARTICLE 5
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
Section 5.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]:
1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION],
2) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
3) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
NOTHING IN THIS ARTICLE SHALL BE CONSTRUED TO ALTER OBLIGATIONS EXPRESSLY
ASSUMED BY BRAD IN OTHER PROVISIONS OF THIS AGREEMENT, INCLUDING WITHOUT
LIMITATION THE PROVISIONS OF ANNEX "B".
<PAGE> 121
ANNEX B - ATTACHMENT A
COVERED COMPONENTS
1. Wing
a. Upper and lower integral stringer machined wing planks.
b. Machined spar, including auxiliary spars.
c. Caps, webs and stiffeners on fabricated spars.
d. Front spar to rear spar wing box ribs.
e. Main landing gear (MLG) machined trunnion rib.
f. MLG side stay machined attachment fittings.
g. Wing/fuselage machined attachment fittings.
2. Fuselage
a. Window and windshield frame structure, but excluding the windows and
windshield. Exterior skins, doublers, circum-ferential frames but
excluding all systems, fairings, insulation, lining and decorative
clips and brackets.
b. Engine mount support box structure and machined pylon attachment
fittings. Primary structure frames around body openings for
passenger door, baggage door, avionics door, flying control access
door, APU access door and emergency exits.
c. Nose landing gear well structure, including wheel well walls,
ceiling, pressure bulkheads and pressure floor structural components
at fuselage wing cutout.
3. Vertical Stabilizer
a. All spars.
b. Horizontal to vertical stabilizer machined attachment fittings.
c. Front spar to fuselage frame machined attachment fittings.
d. Exterior skins, ribs, stringers between front and rear spars and
machined closing rib.
4. Horizontal Stabilizer
<PAGE> 122
Front and rear spars and exterior skins, rib and stringers between front
and rear spars.
The provisions of this Letter Agreement are personal to Buyer and shall
not be assigned or otherwise disposed of by Buyer without the prior written
consent of BRAD.
This Letter Agreement constitutes an integral part of the Agreement and
subject to the terms and conditions contained therein.
In the event of the termination of the Agreement, this Letter Agreement
shall become automatically null and void.
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly
BOMBARDIER INC.
_______________________________
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this ______. day of January, 1997
MESA AIR GROUP, INC.
By___________________________________
Title_________________________________
<PAGE> 123
[BOMBARDIER LOGO]
BOMBARDIER INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5
Telephone (416) 633-7310
Thu, Feb 13, 1997
Our Ref: B96-7701-RJTL-CRJ0351-015
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Re: Letter Agreement No. 015 [CONFIDENTIAL PORTION DELETED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
Gentlemen,
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
<PAGE> 124
SUBJECT: [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
1.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
2.0 [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].
3.0 This Letter Agreement constitutes an integral part of the Agreement and
subject to the terms and conditions contained therein.
4.0 In the event of the termination of the Agreement, this Letter Agreement
shall become automatically null and void.
------------------------------
Should there be any inconsistency between this Letter Agreement and the
Agreement with respect to the subject matter covered by the terms hereof, then
this Letter Agreement shall prevail.
Yours truly,
BOMBARDIER INC.
-----------------------------------
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this day of January, 1997
------
MESA AIR GROUP, INC.
By
--------------------------------------
Title:
--------------------------------
-2-
<PAGE> 125
BOMBARDIER INC.
BOMBARDIER REGIONAL AIRCRAFT DIVISION
Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y
Telephone (416) 633-7310
January 8, 1997
Our Ref: B96-7701-RJTL-CRJ0351-016
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Gentlemen,
Re: Letter Agreement No. 016 (Re: Dispute Resolution Mechanism)
Reference is made to Purchase Agreement No. CRJ-0351 (the "Agreement")
between Bombardier Inc., represented by its Bombardier Regional Aircraft
Division ("BRAD") and Mesa Air Group, Inc. ("Buyer") for the sale of sixteen
(16) Canadair Regional Jet Aircraft (the "Aircraft").
This letter, when accepted and agreed to by Buyer contemporaneously
with execution of the Agreement, will become part of the Agreement and will
evidence our further agreement with respect to the matters set forth below.
All terms used herein and in the Agreement not defined herein, shall
have the same meaning as in the Agreement.
SUBJECT: DISPUTE RESOLUTION MECHANISM
1.0. Any dispute, difference, controversy or claim arising out of or
relating to this Agreement, the breach, or non-performance thereof
shall first be attempted to be resolved by BRAD and Buyer through
mutual negotiations, consultation and discussions.
2.0. Should the parties hereto be unable to settle their differences or
disputes which may arise between them with respect to the
interpretation or application of this Agreement
<PAGE> 126
(a "Dispute") by mutual agreement as provided in Article 1.0 above. the
parties agree to each appoint two (2) representatives to constitute a
joint commission (the "Joint Commission") to jointly hear the
representations of each party regarding the Dispute. At least one (1)
representative of each party shall have knowledge in technical or
contractual matters depending on the nature of the Dispute. The Joint
Commission shall, following presentations by each party, issue
non-binding recommendations to the parties as to how best settle the
Dispute. If the representatives do not agree on joint recommendations,
the representatives of each party shall issue their own
recommendations.
3.0. Either party may request the formation of the Joint Commission if a
dispute is not settled within forty-five (45) days following a written
notice from either party to the other detailing the nature of the
Dispute and the resolution sought. The request for a Joint Commission
shall be made in writing and shall contain the names of the
representatives appointed by the party requesting its formation. The
other party shall then provide the names of its representatives within
thirty (30) days following the receipt of the request for a Joint
Commission.
4.0. The joint Commission shall have forty-five (45) days from its formation
to agree on the procedure to be followed, including the place of
hearing, if any. The Joint Commission shall have sixty (60) days from
the completion of the presentations by each party to issue its
recommendations. The actions of the Joint Committee are for the purpose
of achieving settlement. Comments made by any Committee member, any
statement made during presentations to the Committee, and all
demonstrative or documentary evidence is also submitted for the purpose
of settlement. Nothing stated during the Committee proceedings shall be
considered an admission by either party, nor shall anything presented
to the Committee be admitted into evidence during any arbitration
hearing unless such statement or presentation would be admissible on
its own merits without consideration that it was part of the Committee
proceedings.
5.0. If, despite the recommendations of the Joint Commission, the parties
are unable to resolve the Dispute, either party may request by sixty
(60) days prior notice that the Dispute be settled by arbitration in
accordance with the Arbitration Rules of the American Arbitration
Association applicable to international matters as may be in force at
that time, modified as described in the balance of this paragraph. The
Arbitration panel shall consist of three (3) members, the chair of
which shall be a recently retired, within five (5) years of the request
for arbitration, federal of state judge. With regard to the arbitration
hearing, the Federal Rules of Evidence shall apply, and the non-jury
trial procedures of the Federal Rules of Civil Procedure shall apply as
much as practicable to the arbitration hearing itself. The chairman
shall rule upon all legal objections or procedural questions during the
meeting. All testimony shall be recorded by a certified court reporter
or by such other means allowed by the Federal Rules of Civil Procedure
or which shall be agreed upon by the parties.
6.0. Within thirty (30) days of the demand to refer the Dispute to
arbitration, each party shall appoint one (1) arbitrator, who in turn
will appoint the third arbitrator, within
-2-
<PAGE> 127
thirty (30) days of their appointments. This third arbitrator shall act
as the chairman of the Arbitral Tribunal so constituted. The foregoing
shall not prevent the parties from having the dispute arbitrated by one
arbitrator selected by mutual agreement if they so desire.
7.0. The venue of arbitration shall be [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
8.0. The arbitrators shall not act as "Amiable Compositeur" and shall decide
according to the terms of the agreement and [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION]
9.0. The award of the arbitration as to any factual determinations shall be
subject to review only on a "substantial evidence" basis. Any review of
legal issues shall be upon the same standard of used for appellate
review of lower court cases.
10.0. It is expressly agreed that any statement, representation or document
made or produced to or in connection with, or as a result of the
formation of a Joint Commission shall be without prejudice and without
admission of liability by either party and shall not be used as such by
the other party.
11.0. Each party shall be responsible for its own costs and expenses incurred
as a result of, or in connection with the Joint Commission and
arbitration including the cost, fees and expenses of its own
representatives.
If the foregoing correctly sets forth your understanding of our
agreement with respect to the above matters, please indicate your acceptance and
agreement below.
Yours truly
BOMBARDIER INC.
-----------------------------------
Walter Galloway
Director, Contracts
ACCEPTED AND AGREED TO:
this day of January, 1997
----
MESA AIR GROUP, INC.
By
---------------------------------
Title
------------------------
-3-
<PAGE> 128
================================================================================
SPARE PARTS CONSIGNMENT AGREEMENT
NO. AGT-026
between
BOMBARDIER INC.
and
MESA AIR GROUP, INC.
================================================================================
<PAGE> 129
THIS AGREEMENT made in duplicate and entered into on this ___ day of
January 1997.
between
Mesa Air Group, Inc., A New Mexico company, having an office at 2325
East 30th Street, Farmington, State of New Mexico, U.S.A. 87401;
("BUYER");
and
BOMBARDIER INC., a Canadian corporation represented by its Bombardier
Regional Aircraft Division having its offices at 123 Garratt Boulevard,
Downsview, Ontario, Canada
("BRAD");
WITNESSES THAT
WHEREAS BRAD and Buyer (collectively "the Parties") have entered into
Aircraft Purchase Agreement No. CRJ-0351 (the "Aircraft Purchase Agreement")
whereby Buyer has agreed to for the sale of sixteen (16) Canadair Regional Jet
Aircraft (the "Aircraft").
WHEREAS at the request of the Buyer, BRAD will provide or cause to be
provided selected [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] FOR [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] under this spares
consignment agreement [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] commencing on or about [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] upon the terms and conditions hereof.
NOW THEREFORE the Parties agree as follows:
ARTICLE 1 - DEFINITIONS
1.1. Unless otherwise expressly provided herein, the following words
and expressions shall have the following meanings:
(a) Agreement means this agreement, any amendments or supplements
agreed to by the Parties and any schedules, annexes, appendices or exhibits
attached hereto;
(c) BRAD [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE AND EXCHANGE COMMISSION] means [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
<PAGE> 130
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] which bear a [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] in BRAD's
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] for Buyer;
(d) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(e) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
(f) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]; and
ARTICLE 2 TERM
2.1. This Agreement shall remain in effect for a period of
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] under the Aircraft Purchase Agreement, such [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] unless earlier terminated under Article 15.0 (the "Term").
ARTICLE 2A - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
2A.1 BRAD will ship the [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] valued in the amount of
approximately [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] to Buyer [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] BRAD's shipping point for placement in the [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] prior to the [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]. BRAD will
ship additional [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] in the amount of
approximately [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] after [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION]. Buyer is designated as the [CONFIDENTIAL PORTION DELETED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
2A.2 The Parties agree that, save as otherwise provided for herein, the
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE
-2-
<PAGE> 131
COMMISSION] are intended for the exclusive use of Buyer. Buyer shall
not [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] without the prior written consent
of BRAD or unless requested in writing to do so by BRAD.
ARTICLE 3 - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
3.1. Buyer agrees to [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] withdrawn from the
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] for Buyer's use at the [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] to Buyer. Until
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION], BRAD retains [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] by Buyer for
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION] shall be as follows:
(1) [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] it shall notify BRAD in
writing, specifying [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION], including [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION]. BRAD shall [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] above until
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION], after which no [CONFIDENTIAL PORTION DELETED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] will
occur.
(2) At the [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION], there will be
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] of the [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] for
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] and Buyer [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]. In
addition, Buyer [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] BRAD [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION], starting with [CONFIDENTIAL PORTION DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] after
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION], as long as [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] with
Buyer.
-3-
<PAGE> 132
(3) Buyer [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] at the [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] and [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] BRAD [CONFIDENTIAL PORTION
DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION].
(4) In an effort to be of assistance to Buyer [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION], BRAD [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION] Buyer [CONFIDENTIAL
PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] from [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 4 - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
4.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
4.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 5 - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
5.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 6 - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
6.1. During the term of this Agreement, Buyer shall:
6.1.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
6.1.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
6.1.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION];
-4-
<PAGE> 133
6.1.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
6.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
6.3. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
6.4. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
6.5. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 7 - AUDIT RIGHTS
7.1. BRAD shall, at all times during Buyer's working hours, have the
right to examine, audit or otherwise review, [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]. BRAD undertakes
to [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION], and to observe and comply with all rules, regulations and
procedures of Buyer while on Buyer's premises. [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 8 - CONFIDENTIALITY, INTELLECTUAL PROPERTY AND EXCLUSIVE PURPOSE
Buyer shall not, without the prior written consent of BRAD, use any
trademarks of BRAD or of its affiliates, including without limitation, the words
or expressions 'Bombardier Regional Aircraft Division', 'Bombardier',
'Bombardier Regional Aircraft', 'BRAD', 'Canadair Regional Jet', or 'Canadair'.
All requests for permission to use any of these trademarks shall be accompanied
with the proposed text or document in which it is proposed to be used.
8.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 9 - LIENS AND SECURITY INTEREST
9.1. Buyer will not directly or indirectly create, incur, assume or
suffer to exist any lien, charge or encumbrance on or with respect to
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
9.2. Buyer shall [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION].
-5-
<PAGE> 134
9.3. Buyer shall, [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION]
ARTICLE 10 - GOVERNING LAW
10.1. This Agreement is governed by and is to be construed in
accordance with the local, domestic laws of [CONFIDENTIAL PORTION DELETED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION], specifically
excluding the application of the rules of private international law.
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
ARTICLE 11 - CAPTIONS
11.1. The captions and headings in this Agreement are inserted for
convenience only and in no way define, construe, alter or modify the provisions
of this Agreement.
ARTICLE 12 - ASSIGNMENT
12.1. Buyer may not assign this Agreement, or any part of or interest
in it without the expressed written consent of BRAD.
ARTICLE 13 - WAIVER
13.1. The failure of either BRAD or Buyer to enforce at any time any
of the provisions of this Agreement, or to require at any time performance by
the other, of any of its provisions, will not be construed as a present or
future waiver of such provisions, nor in any way affect the validity of this
Agreement or any part of it, or the right of the other to enforce each and every
such provision, condition or requirement of this Agreement and does not
constitute a waiver or any future obligation to comply with such provision,
condition or requirement.
ARTICLE 14 - NOTICES
14.1. No notice or communication pertaining to this Agreement shall be
deemed to have been duly given.
(a) by Buyer to BRAD unless addressed as follows:
Bombardier Regional Aircraft Division
123 Garratt Boulevard
Downsview, Ontario, M3K 1Y5
Canada
Attention: Director of Contracts
Telephone: (416) 375-4052
Facsimile: (416) 375-4533
-6-
<PAGE> 135
(b) by BRAD to Buyer unless addressed as follows:
Notice by mail
MESA AIR GROUP, INC.
2325 East 30th Street
Farmington, New Mexico
U.S.A. 87401
Attention:
Telephone:
Facsimile:
or to such other place or persons as the Parties may respectively designate in
writing.
Any such notice, requirement, approval, permission, consent or other
communication so delivered by hand will be deemed to have been received by the
addressee on the day when the same has been delivered, or if airmailed, on the
sixth day following the day on which it was airmailed.
ARTICLE 15 - [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]
15.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
15.2. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
ARTICLE 16 - SEVERABILITY
16.1. Should any provision of this Agreement be invalid, unenforceable
for legal reasons or impracticable, it shall not affect the validity of the
other provisions of this Agreement. Invalid, unenforceable or impracticable
provisions shall be replaced by provisions that best meet the purpose of the
provisions to be replaced.
ARTICLE 17 - OTHER
17.1. [CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION].
-7-
<PAGE> 136
IN WITNESS THEREOF the Parties have executed this Agreement.
MESA AIR GROUP, INC. OMBARDIER REGIONAL AIRCRAFT DIVISIOn
By_____________________________________ By___________________________________
Its:_________________________________ Its:_______________________________
-9-
<PAGE> 137
[CONFIDENTIAL PORTION DELETED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION]
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<ARTICLE> 5
<CIK> 0000950153
<NAME> MESA AIR GROUP
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1997
<PERIOD-END> DEC-31-1997
<EXCHANGE-RATE> 1
<CASH> 55,095
<SECURITIES> 6,199
<RECEIVABLES> 42,112
<ALLOWANCES> 272
<INVENTORY> 25,941
<CURRENT-ASSETS> 140,201
<PP&E> 403,771
<DEPRECIATION> 68,679
<TOTAL-ASSETS> 701,744
<CURRENT-LIABILITIES> 63,184
<BONDS> 0
0
0
<COMMON> 101,346
<OTHER-SE> 124,747
<TOTAL-LIABILITY-AND-EQUITY> 701,744
<SALES> 121,412
<TOTAL-REVENUES> 121,412
<CGS> 116,762
<TOTAL-COSTS> 116,762
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 6,696
<INCOME-PRETAX> (1,431)
<INCOME-TAX> (556)
<INCOME-CONTINUING> (875)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (875)
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</TABLE>
