Exhibit 10.6(b)
CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
CONFIDENTIAL TREATMENT REQUEST.
FOURTH AMENDMENT TO THE UNITED EXPRESS AGREEMENT
[United Airlines Letterhead]
December 11, 1998
Mr. Kerry B. Skeen
President & CEO
Atlantic Coast Airlines
515A Shaw Road
Dulles, VA 20166
Re: Fourth Amendment to United Express
Agreement, dated October 1, 1991, and as
amended from time to time thereafter (the
"United Express Agreement")
Dear Kerry:
This letter, when countersigned by you, will constitute a
further amendment to the United Express Agreement as
follows:
1. Parties. Atlantic Coast Airlines Holdings, Inc. will
be a party to the United Express Agreement, and,
together with Atlantic Coast Airlines, will be referred
to in the United Express Agreement as "Contractor".
2. Extension of the United Express Agreement
a. Article 2.B of the United Express Agreement is
hereby amended to read as follows:
"B. This Agreement becomes effective on
October 1, 1991 ("Effective Date"), and,
subject to termination at an earlier
date pursuant to one or more provisions
of this Agreement, will continue in
effect until March 31, 2009; provided,
however, United may terminate this
Agreement without cause effective no
earlier than March 31 2004 upon one (1)
years' prior written notice; provided
further, however, if United so
terminates this Agreement upon one (1)
years prior written notice, the
liquidated damages under Article 16.G
will not apply. In the event, however,
that by January 2, 2001 United fails to
grant Contractor the ability, separate
and apart from the allocations of fifty
seat regional jet aircraft, to operate
regional jet aircraft of 44 seats or
less capacity under this Agreement, then
Contractor will have the right to notify
United that the Agreement will terminate
as of March 31, 2004, which notice must
be given by Contractor by no later than
January 2, 2002; provided, however, if
Contractor timely gives such notice but
United then makes such allocation on or
before January 2, 2002 then Contractor's
aforesaid notice will be null and
avoid."
b. The fifth and sixth lines of Article 16.G (2) are
amended to read as follows:
". . . during the period commencing with the
date of termination through the end of the
term of this Agreement in accordance with
Article 2.B; provided, however, if United
secures . . ."
c. To the extent the agreements entered into between
the parties related to the United Express
Agreement (including agreements relating to
Mileage Plus participation, prorate/revenue
sharing, interline travel, groundhandling, and
emergency response) contain a termination date,
all such agreements are hereby amended such that
each of such agreements will continue in effect
for a term equal to that stated in Article 2.B of
the United Express Agreement; provided, however,
that all such agreements automatically will
terminate contemporaneously with the termination
of the United Express Agreement. The parties
confirm that previous extensions of the United
Express Agreement were intended to effectuate
extensions of these other agreements as well.
3. Program Fee. Appendix I of the United Express
Agreement is amended by the addition of the following
paragraph:
"Notwithstanding anything else contained in
this United Express Agreement to the
contrary, the current Program Fee will be
fixed through March 31, 2000 and will be
subsequently adjusted only in accordance with
the terms of this paragraph. [ *
]
4. Regional Jets. A new Article 4.F, entitled "Regional
Jets" is hereby added to the United Express Agreement
as follows:
"F. Regional Jets
(1) Contractor is authorized to operate up
to 43 regional jet aircraft, 50-seat
capacity, as United Express under the
terms of this Agreement. The schedule
for the introduction of the 34th through
43 such aircraft will be as set forth in
a schedule to this Fourth Amendment to
this Agreement to be agreed upon by
December 21, 1998. The deployment of
any regional jet aircraft operated by
Contractor, as United Express or
operated with United Express livery,
must be approved by United on a city
pair by city pair basis. [ *
] The allocation of any such aircraft to
Contractor thereafter will be governed
by subparagraph F.(2), below.
(2) If the operation of greater than a total
of [* ] fifty seat regional jet
aircraft within the United Express
system is approved and allocated by
United, Contractor will be authorized to
operate a minimum of [ * ] of any
such aircraft above [ *]. Said
percentage will be based upon the total
number of such aircraft approved and
allocated for operation in the total
United Express fleets of all United
Express carriers, in excess of the
initial [ *] fifty seat regional jet
aircraft, measured as of the end of each
calendar year; provided, however, in
applying the foregoing percentage to
determine the number of aircraft
allocable to Contractor fractional
aircraft shall be disregarded."
5. Additional Terms
a. The parties agree to revise the Operating
Performance Standards contained in the United
Express Agreement to mutually agreed levels and
agree upon mutually agreed revised incentives and
consequences based upon achievement or lack
thereof of those Operating Performance Standards.
b. The terms of the letter of understanding, dated
November 2, 1998, regarding Contractor's use of
Orion and its IRS database are incorporated into
the United Express Agreement.
c. The following Article 4.G is hereby added to the
United Express Agreement:
"G. [ *
]
d. Article 16.D of the United Express Agreement is
amended to read as follows:
"D. United may immediately terminate this
Agreement if Contractor enters into a
similar arrangement (including, without
limitation, a code share arrangement)
with any other carrier, unless United
has given Contractor its express prior
written approval of such arrangement."
e. A new Article 12.G is hereby added to the United
Express Agreement as follows:
G. United hereby assumes liability for and
agrees to indemnify, release, defend,
protect, save and hold Contractor, its
officers, directors, agent, and
employees harmless from and against any
and all liabilities, damages, expenses,
losses, claims, demands, suits, fines,
or judgments, including, but not limited
to, attorneys' and witnesses' fees,
costs, and expenses incident thereto,
which may be suffered by, accrue
against, be charges to or be recovered
from Contractor, its officers,
directors, employees, or agents, by
reason of any injuries to or deaths of
persons or the loss of, damage to, or
destruction of property, including the
loss of use thereof, arising out of, in
connection with, or in any way related
to any act, error, omission, operation,
performance or failure of performance of
United or its officers, directors,
employees or agents, which is in any way
related to the services of United
contemplated by or provided pursuant to
this Agreement."
f. Pursuant to Article 3.1 of the United Express
Agreement, United will provide a minimum co-op
advertising budget for calendar year 1999 of [
*].
6. Other Terms and Conditions. Except as specifically
stated above, all other terms and conditions of the
United Express Agreement remain in full force and
effect.
Please confirm the concurrence of Atlantic Coast Airlines
and Atlantic Coast Airlines Holdings, Inc. to the foregoing
by signing below.
Very truly yours
United Air Lines, Inc.
By: /s/ Thomas Hanley_________
Thomas Hanley
By: /s/ Rono Dutta____________
Rono Dutta
Accepted and Agreed to this
17th day of December, 1998
Atlantic Coast Airlines
Atlantic Coast Airlines
Holdings, Inc.
By: /s/Kerry B. Skeen__________
Kerry B. Skeen
President and CEO