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EXHIBIT 10.12
CODE SHARING AGREEMENT
This Agreement is made this 29th day of June, 1994, by and between
CONTINENTAL AIRLINES, INC. ("CAL"), a Delaware corporation, and AMERICA WEST
AIRLINES, INC. ("AWA"), Debtor and Debtor-in-Possession, a Delaware corporation.
RECITALS
CAL and AWA are each certificated air carriers providing air transportation
services in their respective areas of operation.
CAL and AWA desire to cooperate in the coordination of schedules by
allowing AWA to market its flight operations under the CO* designator and CAL to
market its flight operations under the HP* designator.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein contained, CAL and AWA hereby agree as follows:
1. Schedules to be Operated. It is the intent of the parties to share
their two letter designator codes, "CO*" in the case of CAL and "HP*" in the
case of AWA. CAL operated Shared Code Segments (as herein defined) will be
marketed under not only CAL's "CO" designator code but also under AWA's "HP*"
designator code, and AWA operated Shared Code Segments will be marketed under
not only AWA's "HP" designator code, but also under CAL's "CO*" designator code.
Schedule 1 hereto sets forth the flight segments where shared code segments
("Shared Code Segments") will operate at the commencement of this Agreement and
some of the Shared Code Segments that will be operated in the future; however,
it is the intent of the carriers to designate, to the maximum extent permitted
by law, all flights operated by either as Share Code Segments during the term of
this Agreement. The carriers shall meet together every six months that this
Agreement is in effect to discuss the appropriateness of expanding or
contracting the list of city pairs on Schedule 1.
2. Code Sharing Licenses.
(a) CO* License.
(i) Grant of License. Subject to the terms and conditions of this
Agreement, CAL hereby grants to AWA a nonexclusive, nontransferable,
revocable license to use the CO* designator code on all of its flights
operated as a Shared Code Segments. (AWA flights flown using the CO*
code are hereinafter referred to as "CO* Flights").
(ii) Control of CO* Flights. AWA shall have sole responsibility
for and control over, and CAL shall have no responsibility for, control
over or obligations or duties with respect to, each and every aspect of
AWA's operations including, without limitation, scheduling (except as
provided in Section 12 hereto), pricing (except as provided in Section
13 hereto), planning of flight itineraries and routings, reservations,
reservations control/yield management, dispatch, fueling, weight and
balance, flight release, maintenance, and flight operations and
compliance with applicable rules and regulations.
(b) HP* License.
(i) Grant of License. Subject to the terms and conditions of this
Agreement, AWA hereby grants to CAL a nonexclusive, nontransferable,
revocable license to use the HP* designator code on all of its flights
operated as a Shared Code Segment. (CAL flights flown using the HP* code
are hereinafter referred to as "HP* Flights").
(ii) Control of HP* Flights. CAL shall have sole responsibility
for and control over, and AWA shall have no responsibility for, control
over or obligations or duties with respect to, each and every aspect of
CAL's operations including, without limitation, scheduling (except as
provided in
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Section 12 hereto), pricing (except as provided in Section 13 hereto),
planning of flight itineraries and routings, reservations,
reservations control/yield management, dispatch, fueling, weight and
balance, flight release, maintenance, and flight operations and
compliance with applicable rules and regulations.
3. Confidential Information. Neither AWA nor CAL shall disclose to the
other carrier or be required to disclose by the other carrier any information
relating to its scheduling (except as provided in Section 12 hereto), pricing,
inventory control or flight profitability. Neither AWA nor CAL shall disclose
the terms of this Agreement or any proprietary information with respect to the
other obtained as a result of this Agreement, either during the term hereof or
thereafter except as may be required by law or by any order of a court or
administrative agency, and then on ten days' notice to the other. The parties
hereto recognize that, in the course of the performance of each of the
provisions hereof, each carrier may be given and may have access to confidential
and proprietary information of the other carrier, including proposed schedule
and fare changes, statistical data regarding loads and fares, sales and
promotional programs and other operating and competitive information
("Confidential Information"). Each carrier shall preserve, and shall ensure that
each of its officers, agents, consultants and employees who receive Confidential
Information preserve, the confidentiality of the other carrier's Confidential
Information.
4. Quality of Service. Each carrier shall perform its service with respect
to its flights operated under the designation of the other carrier in a timely,
expert and quality manner. Each carrier agrees that, in conducting flight
operations under the designator of the other carrier, it will employ prudent
safety and loss prevention policies.
5. Audit.
(a) CAL Audit. CAL shall have the right, at its own cost, to inspect,
review, and observe AWA's operations of CO* Flights, and/or to conduct a
full safety and/or service audit of AWA's operations, manuals and
procedures reasonably related to CO* Flights, at such intervals as CAL
shall reasonably request. In the exercise of such right, CAL does not
undertake any responsibility for the performance of AWA's operations. CAL
shall coordinate its safety and service audits with AWA so as to avoid
disruptions of AWA's operations. Any safety audit may include, without
limitation, maintenance and operation procedures, crew planning,
reservations, passenger and baggage handling, customer service, personnel
records, spare parts, inventory records, training records and manuals,
flight, flight training and operational personnel records. This paragraph
shall not entitle CAL access to AWA's records, documents or systems
relating to its pricing, inventory control or flight profitability.
(b) AWA Audit. AWA shall have the right, at its own cost, to inspect,
review, and observe CAL's operations of HP* Flights, and/or to conduct a
full safety and/or service audit of CAL's operations, manuals and
procedures reasonably related to HP* Flights, at such intervals as AWA
shall reasonably request. In the exercise of such right, AWA does not
undertake any responsibility for the performance of CAL's operations. AWA
shall coordinate its safety and service audits with CAL so as to avoid
disruptions of CAL's operations. Any safety audit may include, without
limitation, maintenance and operation procedures, crew planning,
reservations, passenger and baggage handling, customer service, personnel
records, spare parts, inventory records, training records and manuals,
flight, flight training and operational personnel records. This paragraph
shall not entitle AWA access to CAL's records, documents or systems
relating to its pricing, inventory control or flight profitability.
6. Public Relations. In the event of any irregularity in Shared Code
Segments' operations, including, without limitation, any event causing damage to
persons or property, the operating carrier shall identify itself as being
operated independently of the carrier whose code is being used, and as being
solely responsible for its operations. Either carrier may state that it holds a
code sharing license from the other carrier and that it obtains certain services
from the other carrier if third parties inquire as to such relationship.
7. Irregularities in Operations. AWA shall promptly notify CAL of all
irregularities involving a CO* Flight which result in any damage to persons or
property as soon as such information is available and shall furnish to CAL as
much detail as practicable. CAL shall promptly notify AWA of all irregularities
involving a
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HP* Flight which result in any damage to persons or property as soon as such
information is available and shall furnish to AWA as much detail as practicable.
8. Reporting Obligation.
(a) Changes in Service. Each carrier shall give the other carrier 60
days advance notice (or notice as far in advance as possible if 60 days is
impracticable) of any intended (i) changes to its operating specifications,
or (ii) material changes to the manner of conducting its business or the
nature of its product. In the event any such change materially affects the
value or risk to the other carrier of this Code Sharing Agreement in the
other carrier's reasonable judgment, the other carrier shall be entitled to
terminate this agreement if the change is implemented.
(b) Correspondence from Government Authorities. AWA shall immediately
provide CAL copies of any correspondence received from government authority
which, with respect to CO* Flights, references (i) any alleged
noncompliance with rules or regulations affecting air transportation, or
(ii) any investigation of AWA performed or proposed by any government
authority, including, without limitation, any communication issued by a
government authority concerning the airworthiness of AWA's aircraft, the
compliance of AWA's personnel with required operational or training
procedures or any other matter relating to the safe operation of AWA
aircraft.
CAL shall immediately provide AWA copies of any correspondence
received from any government authority which, with respect to HP* Flights,
references (i) any alleged noncompliance with rules or regulations
affecting air transportation, or (ii) any investigation of CAL performed or
proposed by any government authority, including, without limitation, any
communication issued by a government authority concerning the airworthiness
of CAL's aircraft, the compliance of CAL's personnel with required
operational or training procedures or any other matter relating to the safe
operation of CAL aircraft.
(c) Notice of Complaints. AWA shall monthly furnish CAL a summary of
complaints, notices or violation, request to cease activity or similar
correspondence which reasonably relate to CO* Flights and which are
received by AWA from passengers, any government authority, or other
parties. CAL shall monthly furnish AWA a summary of complaints, notices or
violation, request to cease activity or similar correspondence which
reasonably relate to HP* Flights and which are received by CAL from
passengers, any government authority, or other parties. Each carrier shall
comply with the other carrier's reasonable requests for actual copies of
any such documents.
9. Flight Display.
(a) All Shared Code Segments will be included in the availability and
fare displays of all computerized reservations systems in which CAL and AWA
participate, the Official Airline Guide (to the extent agreed upon) and
CAL's and AWA's internal reservation systems, under the shared code as well
as the operator's own code, to the extent possible. CAL and AWA will take
the appropriate measures necessary to ensure the display of Shared Code
Segments in accordance with the preceding sentence.
(b) CAL and AWA will disclose and identify the Shared Code Segments to
the public as actually being a flight of and operated by the operating
carrier, in at least the following ways:
(i) a symbol will be used in timetables and computer reservation
system indicating that Shared Code Segments are actually operated by the
other carrier;
(ii) to the extent reasonable, messages on airport flight
information displays will identify the operator of flights shown as
Shared Code Segments;
(iii) CAL and AWA advertising concerning Shared Code Segments and
CAL and AWA reservationists will disclose the operator of each flight;
and
(iv) in any other manner prescribed by law.
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10. Terms and Conditions of Carriage and Claims Procedures.
(a) In all cases the contract of carriage between a passenger and a
carrier will be that of the carrier whose designator code is used and not
that of the carrier operating the Shared Code Flight.
(b) The carriers will use existing IATA procedures when handling and
settling claims made by customers in connection with Shared Code Segments.
11. Irregularity Handling.
(a) In the event of flight delays, cancellations or other schedule
irregularities that affect Shared Code Segments, the operating carrier will
inform the carrier whose designator is also used of all pertinent
information concerning an irregularity for customer information purposes.
(b) The parties agree that they will cooperate in all available ways
to accommodate passengers experiencing flight irregularities and that
neither will forbear from providing such assistance because the other may
have been responsible for the flight irregularity. In the event of a flight
irregularity, the carrier causing or experiencing the irregularity shall
bear all related costs associated with accommodating the passengers who
have been delayed. The carriers will review existing procedures for
accommodating interline passengers with respect to flight irregularities
and oversales to determine their adequacy for the purposes of this
Agreement and will make such adjustments in existing procedures as they
find necessary or appropriate.
12. Airport Operational Assistance. CAL and AWA will cooperate to
coordinate and maintain their schedules to minimize the waiting time and to
maximize convenience of passengers who are connecting from a CAL to AWA flight
segment (or vice versa). Each carrier will provide the other with the airport
operational assistance that is required to assure schedule compatibility for
Shared Code Segments for which a Through Fare (as such term is hereinafter
defined) may be applicable. The carriers will use their respective best efforts
to align gates and ticket counter space where Shared Code Segments operate.
13. Pricing and Capacity Control of Shared Code Segments.
[CONFIDENTIAL PORTION DELETED]
15. Compliance with Laws and Regulations. CAL and AWA each represent,
warrant, and agree that performance of its respective obligations under this
Agreement shall be conducted and all of its personnel shall at all times meet,
be in full compliance with and have all required licenses under any and all
applicable statutes, orders, rules and regulations, and satisfy all applicable
insurance requirements, whether in effect or hereafter promulgated of the United
States National Transportation Safety Board, Department of Transportation of
Federal Aviation Administration, Department of Defense of any country or
territory with jurisdiction over the Shared Code Segments.
16. Independent Parties.
(a) Independent Contractors. It is expressly recognized and agreed
that each carrier, in its performance and otherwise under this Agreement,
is and shall be engaged and acting as an independent contractor and in its
own independent and separate business; that each carrier shall retain
complete and exclusive control over its staff and operations and the
conduct of its business; and that each carrier shall bear and pay all
expenses, costs, risks and responsibilities incurred by it in connection
with its obligations under this Agreement. Neither CAL nor AWA nor any
officer, employee, representative, or agent of CAL or AWA shall in any
manner, directly or indirectly, expressly or by implication, be deemed to
be, or make any representation or take any action which may give rise to
the existence of, any employment, agent, partnership, or other like
relationship as between CAL and AWA but each carrier's relationship as
respects the other carrier in connection with this Agreement is and shall
remain that of an independent contractor.
(b) Status of Employees. The employees, agents and/or independent
contractors of AWA shall be employees, agents, and independent contractors
of AWA for all purposes, and under no circumstances
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shall be deemed to be employees, agents or independent contractors of CAL.
The employees, agents and independent contractors of CAL for all purposes,
and under no circumstances shall be deemed to be employees, agents or
independent contractors of AWA. In its performance under this Agreement,
each carrier shall act as an independent contractor and not as an agent for
the other. CAL shall have no supervisory power or control over any
employees, agents or independent contractors employed by AWA, and AWA shall
have no supervisory power or control over any employees, agents and
independent contractors employed by CAL.
(c) Liability For Employee Costs. Each carrier, with respect to its
own employees (hired directly or through a third party), accepts full and
exclusive liability for the payment of worker's compensation and/or
employer's liability (including insurance premiums where required by law)
and for the payment of all taxes, contributions or other payments for
unemployment compensation, vacations, or old age benefits, pensions and all
other benefits now or hereafter imposed upon employers with respect to its
employees by any government or agency thereof or any other party (whether
measured by the wages, salaries, compensation or other remuneration paid to
such employees or otherwise) and each carrier further agrees to make such
payments and to make and file all reports and returns, and to do everything
necessary to comply with the laws imposing such taxes, contributions or
other payments.
17. Indemnification and Insurance.
(a) Indemnification.
(i) AWA hereby assumes liability for, and shall indemnify, defend,
protect, save and hold harmless CAL, its officers, agents, and employees
from and against any and all liabilities, claims, judgments, damages,
and losses, including all costs, fees, and expenses incidental thereto,
of every type and nature whatsoever, including without limitation those
involving (i) death of or injury to any person including, but not
limited to, AWA's officers, employees and agents, (ii) loss of, damage
to, or destruction of any property whatsoever, including any loss of use
thereof, and (iii) trademark, service mark or trade name infringement,
provided that such liabilities, claims, judgments, damages or losses are
caused by or arise out of (or are alleged to be caused by or arise out
of) any alleged acts or omissions of AWA or its officers, employees, or
agents which are in any way related to the services contemplated by this
Agreement. CAL shall give AWA prompt notice of any claim made or suit
instituted against CAL which, if successful, would result in
indemnification of CAL hereunder, and CAL shall have the right to
compromise or participate in the defense of same to the extent of its
own interest.
(ii) CAL hereby assumes liability for, and shall indemnify, defend,
protect, save and hold harmless AWA, its officers, agents, and employees
from and against any and all liabilities, claims, judgments, damages,
and losses, including all costs, fees, and expenses incidental thereto,
of every type and nature whatsoever, including without limitation those
involving (i) death of or injury to any person including, but not
limited to, CAL's officers, employees and agents, (ii) loss of, damage
to, or destruction of any property whatsoever, including any loss of use
thereof, and (iii) trademark, service mark or trade name infringement,
provided that such liabilities, claims, judgments, damages or losses are
caused by or arise out of (or are alleged to be caused by or arise out
of) any alleged acts or omissions of CAL or its officers, employees, or
agents which are in any way related to the services contemplated by this
Agreement. AWA shall give CAL prompt notice of any claim made or suit
instituted against AWA which, if successful, would result in
indemnification hereunder, and AWA shall have the right to compromise or
participate in the defense of same to the extent of its own interest.
(b) Insurance Coverage.
(i) Each carrier shall, at all time during the term of this
Agreement, maintain in full force and effect policies of insurance as
follows:
1. Comprehensive Airline Liability Insurance, including Aircraft
Third Party, Passenger, including Passengers' Baggage and Personal
Effects, Cargo and Mail Legal Liability for a
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Combined Single Limit (CSL) of not less than $500 million per
occurrence per Aircraft. In respect of Personal Injury the
maximum limit is $25 million per offense and in the aggregate.
The minimum amounts of insurance coverage required under this
paragraph 1 shall be per occurrence, combined single limit for all
coverage required under this paragraph 1.
2. Workmen's Compensation Insurance Per Accident
(Company Employee) Statutory
3. Employer's Liability $1,000,000 (combined single limit)
(ii) Subject to Section 17(b)(i) above, each carrier as appropriate
shall cause the policies of insurance described in such Section 17(b)(i)
to be duly and properly endorsed by that carrier's insurance
underwriters as follows:
1. as to the policies of insurance described in paragraphs
(b)(i)1 and (b)(i)2 of Section 17:
(A) to provide that any waiver of rights of subrogration
against other parties by one party will not affect the coverage
provided thereunder with respect to the other party; and
(B) to provide that the one party's underwriters shall waive
any and all subrogation rights against the other party, its
directors, officers, agents, employees and other authorized
representatives, except for gross negligence or wilful
misconduct, with regard to any breach of warranty on the part of
the other party or to provide other evidence of such waiver or
recourse against the other party, its directors, officers,
agents, employees and other authorized representatives.
(C) to provide that each party, its directors, officers,
agents, employees and other authorized representatives shall be
endorsed as named insured parties thereunder, except for gross
negligence or wilful misconduct; and
(D) to provide that said insurance shall be primary
insurance and to acknowledge that any other insurance policy or
policies of each party shall be secondary or excess insurance.
2. as to policies of insurance described in paragraph (b)(i)1 of
Section 17 to provide a breach of warranty clause to said policies;
and
(iii) Each party shall cause each of the insurance policies
referred to in Section 17(b)(i) to be duly and properly endorsed to
provide that said policy or policies or any part or parts thereof shall
not be canceled, terminated or materially altered, changed or amended by
each party's insurance underwriters, until after 30 days' prior notice
to the other party, such notice period to commence when such other party
actually receives such notice.
(iv) Simultaneously with the commencement of this Agreement, and
from time to time thereafter upon request by either party, the other
party shall furnish to the requesting party evidence reasonably
satisfactory to the requesting party of the aforesaid insurance coverage
and endorsements, including certificates certifying that the aforesaid
insurance and endorsements are in full force and effect. Initially, this
evidence shall be a certificate of insurance required hereunder.
(v) In the event either party fails to maintain in full force and
effect any of the insurance and endorsements required in terms of these
sections, the other party shall have the right (but not the obligation)
to procure and maintain such insurance or any part thereof. The cost of
such insurance shall be payable by the first party to the other party
upon demand by the other party. The procurement of such insurance or any
part thereof by the other party shall not discharge or excuse the first
party's obligation to comply with the provisions of Sections 17(b)(i)
and 17(b)(ii)
(c) Survival of Rights and Obligations. The rights and obligations of
Section 18(a) shall survive the expiration or termination of this
Agreement.
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18. Term and Termination.
(a) Term. Unless the carriers agree to an earlier commencement date,
the term of this Agreement shall commence as soon as practicable after the
date that is the later of the date that this Agreement is signed by both
parties or the date that the investment agreement between AWA and AmWest
partners, L.P. (the "Investment Agreement") is consummated and shall
continue until the date immediately preceding the tenth anniversary of the
commencement date, unless earlier terminated as provided herein, and shall
continue thereafter until either carrier gives the other carrier notice of
termination at least 90 days prior to the effective date of such
termination. In no event shall termination or expiration pursuant to this
Section 18(a) be effective unless such 90 days' notice is provided.
(b) Termination as a Result of Changes of Law. In the event there is
any change in treaties, statutes or regulations of air transportation that
materially affects the rights and/or obligations presently in force with
respect to the air transportation services of CAL or AWA or both, relating
to CO* or HP* Flights, then the carriers will consult, within 30 days after
any of the occurrences described herein, in order to determine or seek
mutual agreement as to what, if any changes to this Agreement are necessary
or appropriate, including but not limited to the early termination and
cancellation of this Agreement.
(c) Other Termination Rights. In addition to any other provisions of
this Agreement, this Agreement may be terminated, without liability, as
follows:
(i) By either carrier on 30 days' prior written notice, if the
other carrier has breached any material provision of this Agreement
unless such other carrier cures such breach within such 30 day period;
(ii) By either carrier immediately on notice, if the other carrier
shall be dissolved or shall fail to maintain its corporate existence in
good standing, or shall have its authority to operate as a scheduled
airline suspended or revoked, either in whole or with respect to the CO*
or HP* Flights, or shall cease operations as a scheduled airline.
(iii) By either carrier immediately on notice if the other carrier
shall be cited by any government authority for any significant
noncompliance with a material law, rule or regulation with respect to
the marketing or operation of a CO* or HP* Flight;
(iv) By either carrier immediately on notice, in the event that the
commencement date of this Agreement is prior to the date that the
Investment Agreement is consummated, if the Investment Agreement is
terminated prior to its having been consummated;
(v) Except for AWA's currently pending Chapter 11 proceeding, by
either carrier if a petition is filed by or against the other carrier
under bankruptcy law, or any other law providing for the relief of
debtors, and the affected party does not succeed in having such petition
lifted or stayed within sixty days from the date of entry; the carrier
at its option may cancel this Agreement immediately and exercise such
other remedies as may be available at law and/or in equity;
(vi) By either carrier on six months' prior written notice, if a
carrier, foreign or domestic, that competes with the terminating carrier
on a material basis, acquires majority ownership of or substantial
control over the other carrier.
(vii) By CAL immediately on notice if
1. AWA shall fail to maintain any of its aircraft in an
airworthy condition and conduct its flight operations in accordance
with the standards, rules and regulations promulgated by any
government authority; or
2. AWA shall have a completion factor of less then 80% during
any 20 day period with respect to CO* Flights (including in such
calculations all flights canceled less than one week prior to the
date of its scheduled operation and excluding flights not completed
due to weather or labor stoppages); and
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(viii) By AWA immediately on notice if
1. CAL shall fail to maintain any of its aircraft in an
airworthy condition and conduct its flight operations in accordance
with the standards, rules and regulations promulgated by any
government authority; or
2. CAL shall have a completion factor of less then 80% during
any 20 day period with respect to HP* Flights (including in such
calculations all flights canceled less than one week prior to the
date of its scheduled operation and excluding flights not completed
due to weather or labor stoppages).
19. Booking Fee. The carrier operating over any segment of a Shared Code
Flight will be responsible for any booking fee relating to such segment charges
by the vendor of a computer reservation system used to create a booking on that
flight. If the booking fee relating to such segment is billed to the carrier
whose designator code is also used for that flight, the operating carrier will
reimburse the carrier whose designator code is also used for that flight.
20. Entire Agreement, Waivers and Amendments. This Agreement constitutes
the entire understanding of the carriers with respect to the subject matter
hereof superseding all prior discussions and agreements, written or oral. This
Agreement may not be amended, nor may any of its provisions be waived, except by
writing signed by both carriers. No delay on the part of either carrier in
exercising any right power or privilege hereunder shall operate as a waiver
hereof, nor shall any waiver operate as a continuing waiver of any right, power
or privilege.
21. Notices. All notices given hereunder shall be in writing delivered by
hand, certified mail, telex, or telecopy to the carriers at the following
addresses:
If to CAL:
Continental Airlines, Inc. Telephone No.: 713-834-2950
2929 Allen Parkway Telecopier No.: 713-520-6329
Houston, Texas 77019
Attention: Vice Chairman & CEO
With copy to:
Continental Airlines, Inc. Telephone No.: 713-834-5149
2929 Allen Parkway Telecopier No.: 713-834-5161
Houston, Texas 77019
Attention: Senior Vice President
and General Counsel
If to AWA:
America West Airlines, Inc. Telephone No.: (602) 693-5880
4000 E. Sky Harbor Blvd. Telecopier No.: (602) 693-5950
Phoenix, AZ 85034
Attention: President & COO
With copy to:
America West Airlines, Inc. Telephone No.: (602) 693-5750
4000 E. Sky Harbor Blvd. Telecopier No.: (602) 593-5904
Phoenix, AZ 85034
Attention: Vice President
and General Counsel
22. Successors and Assigns. Neither carrier may assign its rights or
delegate its duties under this Agreement without the prior written consent of
the other carrier, and any such purported assignment or delegation shall be
void. This Agreement shall be binding on the lawful successors of each carrier.
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23. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
24. Headings. The headings in this Agreement are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
25. Counterparts. This Agreement may be executed in counterparts, all of
which taken together shall constitute one agreement.
26. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without reference to
principles of choice or conflicts of law.
27. Equal Opportunity. EEO clauses contained at 11 C.F.R. sec.sec. 60-1.4,
60-250.4 and 60-741.4 are hereby incorporated by reference. Each party shall
comply with all equal opportunity laws and regulations which apply to or must be
satisfied by that party as a result of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
CONTINENTAL AIRLINES, INC. AMERICA WEST AIRLINES, INC.
By: /s/ BARRY P. SIMON By: /s/ A. MAURICE MYERS
- - ------------------------------- -------------------------------
Title: Senior Vice President Title: President & CEO
- - ------------------------------- -------------------------------
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SCHEDULE 1
INITIAL SHARED CODE SEGMENTS
[CONFIDENTIAL PORTION DELETED]
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SCHEDULE 2
[CONFIDENTIAL PORTION DELETED]
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CARGO SPECIAL PRORATE AGREEMENT
BETWEEN
CONTINENTAL AIRLINES
AND
AMERICA WEST AIRLINES
1. It is hereby agreed between America West Airlines (HP) and Continental
Airlines (CO), to establish a special proration agreement for cargo traffic as
described in Paragraph 2 below.
2. Special prorating applies to transportation of cargo moving jointly via
CO and HP over at least one of the sections identified in Schedule A and
Schedule B.
3. Division of revenue shall be handled directly between CO's headquarter
office and HP's headquarter office according to the terms and conditions of this
agreement; settlement may occur through the Airline Clearing House.
4. Each carrier will set prices for their existing online products and for
the transfer product independently of the other carrier. Each carrier shall be
able to offer the destinations of the other carrier, as identified in Schedules
A and B, as if those points were online cities in their respective systems. Each
carrier has the option to independently file these rates with ATPCO.
5. Movement of dangerous goods, live animals and high value shipments are
excluded from this agreement. Perishables are included under this agreement, but
are subject to embargo for the period of October 1, 1994 through December 31,
1994.
6. Joint transportation revenues shall be allocated to the sections on the
following basis:
(a) WHEN HP AWB 401 IS USED:
CO shall receive the amount per Schedule A for CO sections, and HP
shall receive the revenue remaining.
(b) WHEN CO AWB 005 IS USED:
HP shall receive the amount per Schedule B for HP sections, and
CO shall receive the revenue remaining.
7. Transportation of company material for both CO and HP shall be included
under this agreement, per terms and conditions in Schedule C.
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8. The collecting carrier shall be responsible for claims for loss, damage
or service failure. If fault is determined to be the other carrier, the
collecting carrier shall have the right to bill for such claims through the
Airline Clearing House.
9. The issuing carrier's published rules tariffs will apply.
10. This agreement supersedes all other agreements. The effective date of
this agreement is 01 October 1994.
11. This agreement shall remain in effect until amended or cancelled by
either party by giving 30 days written notice to the headquarter office of the
other party.
12. This agreement is made in duplicate, an original each to be filed at
the below signatories' offices.
CONTINENTAL AIRLINES, INC. AMERICA WEST AIRLINES, INC.
BY: BY:
- - --------------------------------------------- ---------------------------------------------
TITLE: TITLE:
- - --------------------------------------------- ---------------------------------------------
BY: DATE:
- - --------------------------------------------- ---------------------------------------------
TITLE:
- - ---------------------------------------------
DATE:
- - ---------------------------------------------
14
SCHEDULE A
PAGE 1 OF 1
CONTINENTAL AIRLINES PRORATE REQUIREMENT FROM
AMERICA WEST AIRLINES
WHEN SHIPMENT ON HP AWB PREFIX 401
BULK FREIGHT
[CONFIDENTIAL PORTION DELETED]
Additionally, the following commonly operated city pairs shall be included
in this schedule as back-up for severe backlog situations:
MINIMUM
REVENUE RATE
BETWEEN: SHARE PER LB.
- - -------- ------- -------
[CONFIDENTIAL PORTION DELETED]
These rates apply to shipments tendered on an HP air waybill, and HP has
prior or subsequent carriage, with the exception of city pairs listed for severe
backlog.
All rates in U.S. dollars, all weights in pounds.
Chargeable weight shown on air waybill shall be used for calculation of
revenue due CO.
The above rates apply to on-line cities served by Continental Airlines at
the time of tender.
Continental Express cities are excluded from this schedule.
Movement of Human Remains shipments are subject to originating carrier
tariff rules and rates, with revenue distribution based on standard mileage
proration.
EFFECTIVE: 01 October 1994
EXPIRING: 30 Days' written notice
15
SCHEDULE B
PAGE 1 OF 1
AMERICA WEST AIRLINES PRORATE REQUIREMENT FROM
CONTINENTAL AIRLINES
WHEN SHIPMENT ON CO AWB PREFIX 005
BULK FREIGHT
MINIMUM
REVENUE RATE
BETWEEN THE FOLLOWING CITIES: SHARE PER LB.
- - ----------------------------- ------- -------
[CONFIDENTIAL PORTION DELETED]
Additionally, the following commonly operated city pairs shall be included
in this schedule as back-up for severe backlog situations:
MINIMUM
REVENUE RATE
BETWEEN: SHARE PER LB.
- - -------- ------- -------
[CONFIDENTIAL PORTION DELETED]
These rates apply to shipments tendered on a CO air waybill, and CO has
prior or subsequent carriage, with the exception of city pairs listed for severe
backlog.
All rates in U.S. dollars, all weights in pounds.
Chargeable weight shown on air waybill shall be used for calculation of
revenue due HP.
The above rates apply to on-line cities served by America West Airlines at
the time of tender.
America West Express cities are excluded from this schedule.
Movement of Human Remains shipments are subject to originating carrier
tariff rules and rates, with revenue distribution based on standard mileage
proration.
EFFECTIVE: 01 October 1994
EXPIRING: 30 Days' written notice
16
SCHEDULE C
PAGE 1 OF 1
COMPANY MATERIAL
TRANSPORTATION AGREEMENT
Continental Airlines (CO) and America West Airlines (HP) jointly agree to
transport each others' company materials (COMAT) at no charge, according to the
following terms:
1. Each COMAT shipment must be accompanied by a completed COMAT air
waybill, or standard domestic air waybill clearly marked, "COMAT".
2. This schedule is valid within the contiguous 48 states only.
3. Continental Express cities and America West Express cities are excluded
from this schedule.
4. The transportation of empty blood/tissue/urine sample containers for
return to original shipper shall be considered COMAT and transported on
either carrier at no charge.
EFFECTIVE: 01 October 1994
EXPIRING: 30 Days' written notice
17
AMERICA WEST AIRLINES/CONTINENTAL AIRLINES
RECIPROCAL CLUB USAGE AGREEMENT
This Agreement is entered into as of this 25th day of August, 1994 by and
between America West Airlines, Inc., a Delaware corporation, having its chief
executive offices at 4000 East Sky Harbor Boulevard, Phoenix, Arizona, 85034
("America West") and Continental Airlines, Inc., a Delaware corporation, having
its chief executive offices at 2929 Allen Parkway, Houston, Texas 77019
("Continental").
RECITALS:
WHEREAS, America West maintains two (2) private club facilities ("Phoenix
Clubs") located in Phoenix Sky Harbor International Airport for the use of its
bona fide club members and guests;
WHEREAS, Continental maintains private club facilities ("Presidents
Clubs"), with hub locations as outlined on the list attached hereto as Exhibit
A and incorporated herein by reference, for the use of its bona fide club
members and guests;
WHEREAS, each of the parties desires to provide its respective club
members, guests and qualifying passengers (herein collectively referred to as
"members") the opportunity to utilize the club facilities of the other in
accordance with the terms and conditions set forth below;
NOW, THEREFORE, in consideration of the premises and mutual obligations
hereinafter set forth, America West and Continental agree as follows:
1. SCOPE.
a. This Agreement shall govern the usage of the clubs operated by each
party at designated locations, as set forth on Exhibit A.
b. For purposes of this Agreement, America West's Phoenix Clubs at Phoenix
Sky Harbor Airport shall be additionally identified by signage as Continental's
Presidents Club. The Presidents Club locations as indicated on Exhibit A will
display a sign welcoming Phoenix Club members.
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c. This Agreement shall be limited to clubs operated by America West and
Continental. Any other current or future club sharing agreements by either party
with another airline are not a part of, and are specifically excluded from, this
Agreement.
d. Any change or restriction by America West or Continental which affects a
club member's ability to access the clubs of the other party shall be
communicated in writing in advance by both parties.
e. America West and Continental may amend their policies and rules
concerning their clubs at any time as long as any such amendments do not
discriminate against the members of the club of the other party.
f. If, during the term of this Agreement, America West opens a Phoenix Club
or other similar private club facilities at Las Vegas or Columbus, such clubs
will be subject to the terms and conditions of this Agreement with the exception
that America West will only be required to provide signage welcoming Presidents
Club members.
2. TERM:
a. The term of this Agreement shall not commence until the later of the
date that the Investment Agreement between the parties has been consummated as
provided for in that agreement or the date that this Agreement is signed by both
parties
b. The term of this Agreement shall be for a period of two (2) years from
the commencement date.
c. In the event that either party: (i) materially breaches any of its
duties or obligations hereunder which breach shall not be substantially cured
within thirty (30) days after written notice is given to the breaching party
specifying the breach, or (ii) commits a material breach in the performance of
any of its duties or obligations hereunder to which the breaching party is able
to demonstrate to the reasonable satisfaction of the other party that such
breach cannot reasonably be cured within thirty (30) days and fails to proceed
promptly after being given written notice specifying the breach to commence
during said breach and thereafter to proceed with all due diligence to
substantially cure the same, then the party not in breach may, by giving written
notice thereof then the party not in breach may, by giving written notice
thereof to the other party, terminate this Agreement as of the date specified in
such notice of termination.
d. This Agreement may be terminated immediately in the event there is a
change in control of either party.
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19
3. USAGE/AMENITIES/RESERVATION OF RIGHTS:
a. Each party shall make available for use, on a non-exclusive basis, its
respective private clubs, as set forth on Exhibit A, to the other party's
members. Usage of the club facilities by each party's members shall be limited
to the normally scheduled hours of operation of each club facility.
b. Any fees or conditions applicable to the use or provision of amenities
that are or may be in effect at a particular club facility shall be applicable
to each party's members utilizing the facility pursuant to this Agreement.
c. Use of each party's club conference room shall be made available to
respective party's members on a space available basis. All fees incurred by
members in conjunction with such conference room use shall be charged in
accordance with each party's existing pricing structure and member terms and
conditions.
d. Each party and its respective members shall abide by the rules and
regulations governing each particular club facility. A copy of each party's club
rules is attached hereto and marked as Exhibit B and Exhibit C, and both are
incorporated herein by reference.
e. Each party in its sole discretion reserves the right to change the
operating hours of its respective club facilities, and additionally reserves the
right to close all or some of its respective club facilities for holiday
periods. Either party may cease operation of a club facility at any particular
location in its sole discretion without obligation to the other party.
4. ELIGIBLE MEMBERS/PASSENGERS/GUEST POLICY:
a. The following individuals shall be permitted access to the Phoenix Club
facilities:
i. Bona fide members and guests of Continental's Presidents Club
facilities including Chairman's Circle members;
ii. Continental international BusinessFirst passengers;
iii. SAS Royal Viking Club cardholders, SAS customers in C/J/F/P class
of service and valid one-time SAS guest passes;
iv. Air Canada Maple Leaf Club cardholders, Diners Club/EnRoute Gold
Maple Leaf Club cardholders, Aeroplan Elite cardholders, Air
Canada First or Executive Class transborder customers, and valid
one-time Air Canada guest passes;
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20
v. Continental passengers bearing Continental one-time guest passes;
vi. American Express Platinum card holders;
b. The following individuals shall be permitted access to the Presidents
Club facilities:
i. Bona fide members and guests of the America West Phoenix Club
facilities;
ii. America West passengers bearing America West one-time visit
cards;
iii. America West First Class ticket holders (Houston only).
c. Guest Policy: A member's immediate family or two guests may accompany a
member into either party's club facility(ies). Immediate family shall be defined
as the member's spouse, son(s) and/or daughter(s).
5. SIGNAGE:
Each party will provide space at its clubroom for display of signage
provided by the other party in a manner agreed upon by both parties. The cost of
signage will be borne by the party providing the signage.
6. REPORTING:
Each party shall document the usage of their respective club facilities by
the other party's members and exchange usage data on a monthly basis. For
documentation purposes, upon entrance to the club facility, club representatives
will request that members and/or qualifying passengers present their membership
credentials and/or ticket. Club representatives will record: passenger name,
status (i.e. member, family member, guest, one-time guest pass, first/business
class passenger), flight number and date on a "Visitation Register", a copy of
which is set forth as Exhibit D. A copy of the Visitation Registers will be
forwarded by each party, along with a monthly recap report relating to member
usage, by the fifteenth (15th) of each month following the month of usage.
7. FEES:
[Confidential Portion Deleted]
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8. REVENUE:
Any incidental revenues received by either party as a result of
usage of club amenities by either party's respective member shall not be
considered a part of this Agreement and are the sole and exclusive income of
such party.
9. PROMOTION/ADVERTISEMENT:
Either party may choose to advertise/promote the benefits of this
reciprocal club usage Agreement provided that all copy generated for advertising
purposes, whether print, radio or television, receives the prior written
approval of the other party. It is agreed that any advertisement or promotion
which contains any trademark/servicemark or copyright of either party will be
appropriately identified as a registered trademark/servicemark or copyright.
10. INDEMNIFICATION:
The party operating the club facilities will defend and indemnify the other
party and their respective directors, officers, employees and agents
(collectively "Indemnitees") against and hold each Indemnitee harmless from all
liabilities, damages, losses, claims, suits, judgments, costs and expenses
(including reasonable attorney's fees) for injury to or death of any person or
damage to or destruction of any property arising out of participation in the
respective club program, except that such indemnification shall not extend to
acts of gross negligence or willful misconduct by the indemnified party.
11. NOTICE:
Any notice required to be sent under this Agreement will be sent by first
class mail, postage pre-paid, or any other more expedient written means.
Notices to America West should be addressed as follows:
America West Airlines, Inc.
4000 E. Sky Harbor Blvd.
Phoenix, AZ 85034
Attention: Rose Ceglia, Director
Frequent Traveler Marketing
HY-FTM
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22
Notices to Continental should be addressed as follows:
Continental Airlines, Inc.
2929 Allen Parkway
Suite 1389
Houston, TX 77019
Attention: David Grizzle
Vice President
Marketing
Notices sent via electronic means (e.g., telex, facsimile) will be
effective immediately if received prior to 5:00 p.m. local time of the
recipient. All other notices will be effective the first business day after
receipt.
12. CHOICE OF LAW:
This Agreement shall be governed in accordance with the laws of the State
of New York.
13. ASSIGNMENT:
This Agreement may not be assigned by either party absent written consent
by the other party.
14. COMPLIANCE WITH APPLICABLE LAWS:
Each party will comply with all federal, state and local laws and
regulations with respect to its respective club facilities and the products and
services to be provided by each party hereunder.
15. ENTIRE AGREEMENT:
This Agreement constitutes the entire understanding of both America West
and Continental regarding the subject matter of this Agreement. The parties have
executed this Agreement by their authorized representatives as of the dates
below.
AMERICA WEST AIRLINES, INC. CONTINENTAL AIRLINES, INC.
by: by:
- - ------------------------------------------------------ ------------------------------------------------------
Title: Title:
- - ------------------------------------------------------ ------------------------------------------------------
Date: Date:
- - ------------------------------------------------------ ------------------------------------------------------
6
23
EXHIBIT A
[Confidential Portion Deleted]
EXHIBIT B
Phoenix Club Membership Brochure
EXHIBIT C
President's Club Rules Brochure
EXHIBIT D
Sample Phoenix Club Guest Registry
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RECIPROCAL FREQUENT FLYER PROGRAM PARTICIPATION AGREEMENT
This Agreement is made this 25th day of August, 1994, by and between
Continental Airlines, Inc., a Delaware corporation ("CAL"), and America West
Airlines, Inc., Debtor and Debtor-in-Possession, a Delaware corporation ("AWA").
RECITALS
CAL and AWA are each certificated air carriers providing air transportation
services in their respective areas of operation.
CAL and AWA have entered into a "Code Sharing Agreement" whereby CAL will
market its flight operations under the HP* designator code and AWA will market
its flight operations under the CO* designator code.
CAL and AWA each maintain frequent flyer programs, "OnePass" in the case
of CAL and "FlightFund" in the case of AWA, whereby members of such programs
earn reward miles for miles flown on the airlines participating in the program
that may be redeemed for various travel related awards.
CAL and AWA desire to allow members of their respective frequent flyer
programs ("OP Members" in the case of CAL and "FF Members" in the case of AWA)
to earn miles in their respective programs when members travel on flights
operated by the other carrier that are utilizing its designator code.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein contained, CAL and AWA hereby agree as follows:
1. Mileage Accrual. CAL and AWA will permit OP Members to accrue the
greater of [Confidential Portion Deleted] miles or the number of actual miles
flown in OnePass for travel on flights that are designated as CO* Flights (as
such term is defined in the Code Sharing Agreement) in the same manner as OP
Members accrue miles in OnePass on CAL operated flights utilizing the CO
designator code. AWA and CAL will permit FF Members to accrue the greater of
[Confidential Portion Deleted] miles or the number of actual miles flown in
FlightFund for travel on flights that are designated as HP* Flights (as such
term is defined in the Code Sharing Agreement) in the same manner as FF Members
accrue miles in FlightFund on AWA operated flights utilizing the HP designator
code.
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2. RECORDING OF MILEAGE CREDIT.
a. AWA shall require each OP Member who desires to accrue mileage in
OnePass and is traveling on a flight designated as a CO* Flight to submit a
OnePass identification card (or such other indicia of membership as CAL may
advise) prior to boarding any flight designated as a CO* Flight. CAL shall
require each FF Member who desires to accrue mileage in FlightFund and is
traveling on a flight designated as an HP* Flight to submit a FlightFund
identification card (or such other indicia of membership as AWA may advise)
prior to boarding any flight designated as an HP* Flight.
b. Each carrier shall transmit to the other carrier by computer tape, or by
means of data transmission (modem), all pertinent data necessary to enable each
carrier to credit mileage. Each carrier shall provide this data in a format
compatible with the other carrier's computer systems and upon receipt of such
data shall credit the members' account. Data to be provided shall include member
name and identification number, carrier code, date of travel, flight number,
city pair and class of service booked and flown. The tape with this information
will be delivered or transmitted daily as noted below:
HP* activity tapes to:
America West Airlines
1930 West University, 52N-ISD
Tempe, Arizona 85281
Attn: Tape Librarian
CO* activity tapes to:
Electronic Data Systems
Tape Librarian
9014 Research Drive
Charlotte, North Carolina 28262
If transmissions are via modem, carriers will establish mutually agreeable
procedures.
c. Individuals who are members of the frequent flyer programs of both
carriers will not be permitted to accrue miles in both programs for travel on
the same flight. Such members shall only be permitted to accrue miles in the
program of the carrier of their election.
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26
d. Miles earned by members for flights on Shared Code Segments will be
treated by each carrier in the same manner as any other miles earned or redeemed
in such carrier's program.
3. MILEAGE CHARGE, PAYMENT AND RECONCILIATION.
a. Mileage Charge. AWA will pay to CAL, in accordance with 3.b. below, an
amount equal to the number of actual miles flown by OP Members electing to
receive OnePass miles on flights designated as CO* Flights, multiplied by
$[Confidential Portion Deleted]. CAL will pay, in accordance with 3.b. below, to
AWA an amount equal to the number of actual miles flown by FF Members electing
to receive FlightFund miles on flights designated as HP* Flights, multiplied by
$[Confidential Portion Deleted].
b. Payment. Beginning the first full month that this Agreement is in
effect, and each month thereafter, each carrier will pay the other carrier,
through the Airline Clearing House, the amount due pursuant to 3.a. above for
actual miles flown during the previous month. Neither carrier will invoice the
other carrier for miles until after such time as the miles have been actually
posted.
c. In no case will either carrier be required to pay the other carrier,
pursuant to Section 3.b., more than $500,000 during any calendar year, provided
that if a carrier is owed more than $500,000 during a calendar year and the
other carrier does not pay the carrier an amount equal to the deficiency within
30 days of demand thereof, the carrier that is owed money may terminate this
Agreement by providing the other carrier with 120 days notice of such
termination.
d. Each carrier will provide a monthly report to the other carrier which
tracks the number of miles posted to its members' accounts for activity related
to Shared Code Segments. This report will contain the number of (i) actual and
bonus miles posted (e.g. minimum miles, class of service, double miles, elite
member bonuses, etc.), (ii) city pair, (iii) ticket booking code (Y, F, Q,
etc.), (iv) miles rejected, and (v) retroactive mileage credited. Additionally,
a printout of rejected and retroactively credited transactions will accompany
this report. Such report shall be furnished 30 days after the end of the monthly
period for which such report relates.
e. Requests by members of either carrier's frequent flyer program made
after the date of travel for mileage on Shared Code Segments during the most
recent six (6) month period will be processed by the Service Center of the
carrier that operates the frequent flyer program in which the member seeks to
accrue miles on an on-going basis. The number of retroactive requests that are
credited will be processed by each carrier on a weekly basis. Miles will be
added retroactively only when a copy of the ticket and original boarding pass
or ticket jacket is received by the Service Center. Such documents will be
maintained for one (1) year so that each carrier has the ability to audit them
at its reasonable request.
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f. In the event that an original boarding pass or ticket jacket is not
provided, retroactive credit will only be credited after a member's request is
reviewed by both carriers and procedural steps have been taken to ensure that a
member does not receive credit for a single transaction in both programs.
4. MILEAGE REDEMPTION.
[Confidential Portion Deleted]
5. REWARD TRAVEL CHARGES, PAYMENT AND RECONCILIATION.
a. Reward Travel Charge. [Confidential Portion Deleted]
b. Reward Travel Payment. Each month during the term hereof, AWA will pay
CAL, through the Airline Clearing House, the amount due pursuant to 5.a. above
for reward travel during the previous month.
c. Reward Travel Reconciliation. Each carrier will comply with the ticket
reconciliation and accounting procedures set forth in Exhibit C hereto.
6. PROGRAM RULES.
a. CAL's obligation to provide OnePass miles to OP Members is subject to
the OP Members' compliance with the terms and conditions set forth in the
OnePass Members' Guide, as such may be amended and supplemented by CAL from time
to time. AWA's obligation to provide FlightFund miles to FF Members and to
permit FF Members to redeem FlightFund miles for reward travel on flights
operated by CAL is subject to the FF Members' compliance with the terms and
conditions set forth in the FlightFund Members' Guide, as such may be amended
and supplemented by AWA from time to time.
b. Each carrier will seek written approval from the other carrier of
substantial changes to program rules, award levels and copy that affect the
other carrier. Neither carrier will unreasonably withhold its approval or
substantive comments as to the sufficiency of any advertising copy of the other.
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7. Advertising and Promotional Efforts. During the term of this Agreement,
and at no cost to the other carrier, either carrier, on a periodic basis, may
actively promote its participation in the other carrier's frequent flyer
program.
a. The carriers may choose to advertise such participation in various
media, which may include, but not be limited to, print, radio, television
and member communications.
b. All copy generated must receive prior written approval by the carrier's
designee.
c. It is agreed that any advertising or promotion which contains any
trademark, service mark or copyright of either carrier will be appropriately
identified as a registered trademark, service mark or copyright.
d. Direct access to and use of either carrier's membership name lists,
including preferred status members, for cross marketing purposes outside of the
usual program communications, are subject to further discussion and are not a
part of this Agreement.
e. The carriers agree to meet and discuss short and long term marketing
plans.
8. Additional Frequency Marketing Opportunities.
a. CAL and AWA agree that this travel relationship is not an exclusive
Agreement. Therefore, each carrier, at its discretion, may maintain and promote
other airline relationships through its frequent flyer program.
b. While this Agreement addresses the terms and conditions for
participation in each carrier's frequent flyer program, both carriers agree to
explore other joint possibilities of developing and implementing additional
marketing relationships, programs and strategies designed to create incremental
demand for each carrier's products and services. Separate fees may be required
for such participation and will not conflict in any way with this Agreement or
the Code Sharing Agreement between both carriers.
9. Continuation of Programs. Nothing herein contained shall obligate
either carrier to continue operation of its frequent flyer program and either
carrier may terminate its program without penalty by providing the other carrier
with 180 days' advance notice of such program termination.
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10. Program Administration and Reward Ticket Issuance.
a. Each carrier shall administer its frequent flyer program and all rules
and regulations that apply to its members. Reward ticket issuance procedures
will be mutually agreed upon by both carriers.
b. Each carrier reserves the right to alter its frequent flyer program at
any time and in any manner consistent with this Agreement, but shall not
modify or amend the mileage accrual or reward levels which affect the other
carrier without advance notice.
c. Each carrier will be responsible for communicating directly with its
frequent flyer members to resolve problems regarding reward travel on the other
carrier. However, the carriers will cooperate to the extent reasonable and
necessary to resolve any customer service issues involving reward travel.
d. Both carriers will take prompt and reasonable steps to train their
customer service and accounting personnel regarding the other carrier's program.
This training will include how to: capture and track transactions, issue reward
tickets for travel on the other carrier, refer a passenger regarding specific
program information and execute any other customer service that supports the
frequent flyer programs. This training will include initial as well as recurrent
efforts to ensure administrative efficiency.
11. Future Review
a. The carriers will meet on an annual basis and review the charges
hereunder for redeemed and accrued miles to determine whether the charges should
be adjusted or not. In addition, if the frequent flyer program of either carrier
changes such that the charges hereunder do not produce the results contemplated
herein, the carriers, upon request by the carrier operating the unchanged
program, will meet to determine whether the charges should be adjusted or not.
If, pursuant to meetings held pursuant to this Section it is determined that
adjustment of the charges is necessary, the carriers shall negotiate in good
faith to determine what charges are unable to agree on appropriate charges, the
dispute will be submitted to a committee consisting of an equal number of
members of each carrier's senior management for final resolution.
b. If, during the first 90 days after program members are able to accrue or
redeem miles pursuant this Agreement, either carrier receives a significant
number of complaints from its frequent flyer program members concerning its
participation in this Agreement, then, upon written notice from the carrier
receiving
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the complaints within 30 days after the end of such 90 day period, the
carriers will meet to discuss the action that must be taken in order to
correct the problem(s) that gives rise to the complaints. If the carriers
are unable to agree on a solution, the carriers will submit the dispute
to a committee consisting of an equal number of members of each carrier's
senior management for final resolution.
12. INDEPENDENT PARTIES. It is expressly recognized and agreed that each
carrier, in its performance and otherwise under this Agreement, is and shall be
engaged and acting as an independent contractor and in its own independent and
separate business; that each carrier shall retain complete and exclusive control
over its staff and operations and the conduct of its business; and that each
carrier shall bear and pay all expenses, costs, risks and responsibilities
incurred by it in connection with its obligations under this Agreement. Neither
CAL nor AWA nor any officer, employee, representative, or agent of CAL or AWA
shall in any manner, directly or indirectly, expressly or by implication, be
deemed to be, or make any representation or take any action which may give rise
to the existence of, any employment, agent, partnership, of other like
relationship as between CAL and AWA but each carrier's relationship as respects
the other carrier in connection with this Agreement is and shall remain that of
an independent contractor.
13. INDEMNITY. Each carrier agrees to indemnify, reimburse and hold
harmless the other carrier and its directors, officers, employees and agents
(collectively, the "Indemnified Party") from and against any claim (including,
without limitation, those based on strict liability and tort), losses,
liabilities, demands, suits, judgments, causes of action, awards or decisions in
all judicial, administrative or arbitration proceedings, whether civil or
criminal, penalties, fines and other sanctions and any costs or expenses in
connection therewith, including reasonable attorneys' fees and expenses, which
result from, are based upon or arise in any manner out of (i) air transportation
provided by the indemnifying carrier, (ii) the promotion of either frequent
flyer program or the indemnified carrier by the indemnifying carrier (it being
understood that the foregoing indemnification shall not extend to any promotion
by the indemnifying carrier of the indemnified carrier that is approved by the
indemnified carrier), (iii) any breach of this Agreement, or (vi) the
administration of the indemnifying carrier's frequent flyer program. Each
carrier shall give the other carrier prompt notice of any claim made or suit
instituted against it which, if successful, would result in indemnification by
the other carrier hereunder, and the Indemnified Party shall have the right to
compromise or participate in the defense of same to the extent of its own
interest.
14. TERM AND TERMINATION.
a. Term. Unless the carriers agree to an earlier commencement date, the
term of this Agreement shall commence as soon as practicable after the date that
is the later of the date that this Agreement is signed by both parties or the
date that the investment agreement between AWA and AmWest Partners, L.P. (the
"Investment Agreement") is consummated and shall continue until the date
immediately preceding the tenth anniversary of the commencement date, unless
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earlier terminated as provided herein, and shall continue thereafter until
either carrier gives the other carrier notice of termination at least 90 days
prior to the effective date of such termination. In no event shall termination
or expiration pursuant to this Section 14(a) be effective unless such 90 days'
notice is provided.
b. Termination as a Result of Changes of Law. In the event there is any
change in treaties, statutes or regulations of air transportation that
materially affects the rights and/or obligations presently in force with respect
to the air transportation services of CAL or AWA or both, relating to CO* or HP*
Flights, then the carriers will consult, within 30 days after any of the
occurrences described herein, in order to determine or seek mutual agreement as
to what, if any changes to this Agreement are necessary or appropriate,
including but not limited to the early termination and cancellation of this
Agreement.
c. Other Termination Rights. In addition to any other provisions of this
Agreement, this Agreement may be terminated, without liability, as follows:
(1) By either carrier on 30 days' prior written notice, if the other
carrier has breached any material provision of this Agreement unless such
other carrier cures such breach within such 30 day period;
(2) By either carrier immediately on notice, if the other carrier
shall be dissolved or shall fail to maintain its corporate existence in
good standing, or shall have its authority to operate as a scheduled
airline suspended or revoked, either in whole or with respect to the CO* or
HP* Flights, or shall cease operations as a scheduled airline;
(3) By either carrier immediately on notice if the other carrier shall
be cited by any government authority for any significant noncompliance with
a material law, rule or regulation with respect to the marketing or
operation of a CO* or HP* Flight;
(4) By either carrier immediately on notice, in the event that the
commencement date of this Agreement is prior to the date that the
Investment Agreement is consummated, if the Investment Agreement is
terminated prior to its having been consummated;
(5) By either carrier if a petition is filed by or against the other
carrier under bankruptcy law, or any other law providing for the relief of
debtors, and the affected party does not succeed in having such petition
lifted or stayed within sixty days from the date of entry; the carrier at
its option may cancel this Agreement immediately and exercise such other
remedies as may be available at law and/or in equity;
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32
(6) By either carrier on six months' prior notice, if a carrier,
foreign or domestic, that competes with the terminating carrier on a
material basis, acquires majority ownership of or substantial control over
the other carrier.
(7) By either carrier on 180 days' prior notice, if it terminates its
frequent flyer program.
(8) By either carrier, after this Agreement has been in effect for
two (2) years, without cause on 180 days' prior notice.
d. All notices to active members of the termination of either carrier's
participation in the other carrier's program will be the sole responsibility of
the carrier who operates the program to which the member belongs and shall be
undertaken at such carrier's sole cost and expense.
e. Upon termination of this Agreement, then:
(1) Effective on the termination date AWA will not process reward
requests for travel to destinations served by CAL as defined in Exhibit A
for FF Members.
(2) For a period of twelve (12) months after the effective date of
such termination, CAL will continue to honor any valid reward ticket
issued on or before the termination date of this Agreement.
15. Audit and Control System.
a. Upon request from either carrier, the other carrier will provide the
requesting carrier with such reasonable audit and verification documentation as
the requesting carrier may reasonably require in order to verify, to the extent
possible, the following:
(1) the accuracy of members' account information;
(2) the extent to which processing and administrative internal controls
effectively safeguard members' account information; and
(3) the continuing assurance that transactions will be properly
processed and reported.
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b. When problems with the data reporting have been identified, the carrier
creating the problem will correct the deficiencies, promptly and without charge.
A deficiency is defined as a condition which results in any, or all of the
following, due to tape or data transmission related problems or manual tracking
procedures:
(1) loss of data
(2) incorrect processing
(3) unauthorized data alteration
(4) incorrect reporting
c. For eighteen (18) months following the effective termination date of
this Agreement, either carrier shall have the right, during reasonable times and
upon reasonable request, to audit the records maintained by the other carrier
relating to the program participation herein and to copy or make extracts from
any and all books and records of the other carrier relating to such carrier's
performance hereunder.
16. CONFIDENTIALITY.
a. Except in a proceeding to enforce any of the provisions of this
Agreement, neither carrier (the "User") will, without the prior written consent
of the other carrier (the "Owner"), publicize or disclose to any third party,
either directly or indirectly, any of the following ("Confidential
Information"):
(1) Any of the terms or conditions of this Agreement other than those
terms and conditions required to be disclosed to program members hereunder;
or
(2) Any confidential or proprietary information or data received from
the Owner (which has been clearly and conspicuously marked "Confidential")
except information that is or becomes generally available to the public
other than as a result of disclosure by the User or is, or becomes,
available to the User on a nonconfidential basis from a source other than
the Owner which source, to the User's knowledge, is not prohibited from
disclosing such information to the User by a legal, contractual or
fiduciary obligation to the Owner.
(3) Information provided by oral communications, computer tapes, data
transmissions and other non-written forms will be
10
34
considered confidential unless otherwise stated by the carrier providing
the information.
(4) If either carrier is served with subpoena or other legal process
requiring the production or disclosure of any confidential information,
that carrier will immediately notify the Owner, and will use its best
efforts to permit the Owner, at its sole cost and expense, a reasonable
period of time to intervene and contest disclosure or production.
(5) Upon termination of this Agreement, the User must return any and
all confidential information received from the Owner.
(6) Each party shall restrict all confidential information to
respective employees on a "need to know" basis.
17. ENTIRE AGREEMENT WAIVERS AND AMENDMENTS. This Agreement constitutes
the entire understanding of the carriers with respect to the subject matter
hereof superseding all prior discussions and agreements, written or oral. This
Agreement may not be amended, nor may any of its provisions be waived, except by
writing signed by both carriers. No delay on the part of either carrier in
exercising any right power or privilege hereunder shall operate as a waiver
hereof, nor shall any waiver operate as a continuing waiver of any right, power
or privilege.
18. NOTICES. All notices given hereunder shall be in writing delivered by
hand, certified mail, telex, or telecopy to the carriers at the following
addresses:
If to CAL:
Continental Airlines, Inc. Telephone No.: 713-834-2950
2929 Allen Parkway Telecopier No.: 713-520-6329
Houston, Texas 77019
Attention: Vice Chairman & CEO
With copy to:
Continental Airlines, Inc. Telephone No.: 713-834-5149
2929 Allen Parkway Telecopier No.: 713-834-5161
Houston, Texas 77019
Attention: Senior Vice President
and General Counsel
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35
If to AWA:
America West Airlines, Inc. Telephone No.: (602) 693-5880
4000 E. Sky Harbor Blvd. Telephone No.: (602) 693-5990
Phoenix, AZ 85034
Attention: President & COO
With copy to:
America West Airlines, Inc. Telephone No.: (602) 693-5750
4000 E. Sky Harbor Blvd. Telephone No.: (602) 693-5904
Phoenix, AZ 85034
Attention: Senior Vice President
and General Counsel
19. SUCCESSORS AND ASSIGNS. Neither carrier may assign its rights or
delegate its duties under this Agreement without the prior written consent of
the other carrier, and any such purported assignment or delegation shall be
void. This Agreement shall be binding on the lawful successors of each carrier.
20. SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
21. HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
22. COUNTERPARTS. This Agreement may be executed in counterparts, all of
which taken together shall constitute one agreement.
23. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without reference to
principles of choice or conflicts of law.
24. EQUAL OPPORTUNITY. EEO clauses contained at 11 C.F.R. Sections 60-1.4,
60-250.4 and 60-741.4 are hereby incorporated by reference. Each party shall
comply with all equal opportunity laws and regulations which apply to or must be
satisfied by that party as a result of this Agreement.
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36
25. Non-Waiver. The right of either carrier to require strict performance
and observance of any obligations hereunder will not be affected in any way by
any previous waiver, forbearance or course of dealing.
26. Compliance with Applicable Laws. Each carrier will comply with all
federal, state and local laws and regulations with respect to its respective
role in connection with the program and the products and services to be provided
by such carrier hereunder.
27. Force Majeure. Neither CAL nor AWA will be liable for delays in
performance caused by acts of God, war, strike, labor dispute, work stoppage,
fire or any other cause, whether similar or dissimilar, beyond the control of
the carrier whose performance is delayed.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
CONTINENTAL AIRLINES, INC. AMERICA WEST AIRLINES, INC.
By: By:
- - --------------------------------------------- ---------------------------------------------
Title: Title:
- - --------------------------------------------- ---------------------------------------------
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EXHIBIT A
REWARD TRAVEL ON CAL FLIGHTS
1. REWARD DESTINATIONS
FF Members may redeem FlightFund miles for travel on CAL flights from a CAL
North American gateway to the following destinations:
Europe
Hawaii
Asia
2. REWARD LEVELS
FF Members will be able to redeem miles for travel on CAL flights at the
following roundtrip levels:
TRAVEL AREA (1) COACH (1) FIRST
----------- --------- ---------
Between the Continental
United States & Hawaii 50,000 TBD
Between the Continental
United States & Asia 65,000 TBD
Between the Continental
United States & Europe 65,000 N/A
3. REDEMPTION PROCEDURES
FF Members may only redeem FlightFund miles for reward travel on CAL
flights by submitting a request to AWA in accordance with the terms and
conditions applicable to FF Members. AWA will contact CAL via telephone or
reservation system to request reward travel for FF Members on CAL flights. CAL
will have specific staff dedicated to FlightFund reward requests and respond to
reward requests within 48 hours of receipt of the request. Once properly
confirmed, all reward travel reservations will be honored by CAL. AWA will issue
all FlightFund reward tickets. Once issued, all reward tickets will be valid for
one year. CAL will not impose any restrictions on advance booking of reward
travel and changes to previously confirmed reservations will be accepted up to
the day prior to departure from the point of origin.
A-1
38
4. CAPACITY RESTRICTIONS
CAL may reasonably restrict the number of seats on an CAL flight available
for travel pursuant to a FlightFund reward ticket, but AWA shall have access
equal to reward seats provided to OP Members. CAL may impose blackout dates for
FlightFund Reward travel, provided that such blackout dates correspond to the
blackout dates applicable to OP Members.
5. QUALITY OF SERVICE
CAL shall provide service to FF Members traveling on CAL flights pursuant
to FlightFund rewards to the same extent and in the same manner that it provides
service to OP Members on CAL flights. In the event of a current day flight
cancellation, CAL or AWA will reaccommodate FlightFund or OnePass reward travel
exclusively on flights operated by either CAL or AWA.
A-2
39
EXHIBIT B
REWARD TRAVEL CHARGE
For flights operated by either carrier as Shared Code Segments or, when
there is system-wide domestic code sharing pursuant to the Code Sharing
Agreement, all flights, the charge per mile flown is as follows:
Coach to all except Hawaii
Coach to Hawaii [ CONFIDENTIAL PORTION DELETED ]
BusinessFirst to Hawaii
For flights operated by either carrier as other than Shared Code Segments
prior to system-wide domestic code sharing pursuant to the Code Sharing
Agreement, the charge per mile flown is as follows:
Coach to all except Hawaii
Coach to Hawaii [ CONFIDENTIAL PORTION DELETED ]
BusinessFirst to Hawaii
B-1
40
EXHIBIT C
AWARD TICKET RECONCILIATION
ACCOUNTING PROCEDURES
1. AWA agrees that off-line reward tickets for travel on CAL will be issued
by AWA on AWA's ticket stock.
2. Reward tickets will include a discrete fare basis code so that the usage
of reward travel tickets can be tracked.
3. On a monthly basis AWA will provide CAL with the number of reward
tickets issued by date, award level and city pair. Such reports will be provided
30 days after the end of the month for which such report relates.
4. CAL will include in its monthly Interline Billing Invoice to AWA, the
lifted reward travel flight coupons which are reported for purposes of
settlement through the Airlines Clearing House (ACH).
5. Reward tickets will be compared to flown reward travel.
C-1
41
MASTER GROUND HANDLING AGREEMENT
This agreement is made this day of August 22, 1994, by and between
Continental Airlines, Inc., a Delaware corporation ("CAL"), and America
West Airlines, Inc., Debtor and Debtor-in-Possession, a Delaware corporation
("AWA").
RECITALS
CAL and AWA are each certificated air carriers providing air transportation
services in their respective areas of operation.
CAL and AWA are each capable of providing various ground handling services,
including customer service, ramp service line maintenance, maintenance of ground
support equipment and aircraft cleaning, and have the facilities and equipment
necessary to perform such services (collectively, the "Services") at airports
where they operate.
CAL and AWA each desire to consolidate various ground handling services,
facilities and equipment at airports where both airlines operate in order to
take advantage of certain synergy opportunities.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein contained, CAL and AWA hereby agree as follows:
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1. DEFINITIONS.
a. Handling Company: The airline providing the Services.
b. Carrier: The airline receiving the Services.
2. SERVICES TO BE PROVIDED AND LOCATIONS. The airlines will mutually
determine what Services will be provided by one airline for the other airline at
locations where both airlines conduct air carrier operations. The locations
where both airlines conduct operations are set forth in Exhibit A hereto. The
factors that will be considered in determining which airline provides Services
at a particular location will be the number of flights that each airline
operates at the location, the overall savings that may be realized, the presence
of third party constraints, the number of locations that an airline provides or
is likely to provide Services for the other airline, and any legitimate business
concerns. The Services to be provided at each location shall be described
according to Annex A of the SGHA of April 1993, and attached hereto as
Exhibit C.
3. PRICING.
[Confidential Portion Deleted]
2
43
[Confidential Portion Deleted]
3
44
[Confidential Portion Deleted]
b. The Handling Company shall provide full disclosure of the costing of
services to the Carrier upon request.
c. For purposes of Section 3.a. hereof, the incremental cost to the
Handling Company of providing the Services will be the sum of the costs
below that are incremental to the Handling Company as a result of
providing the Services for the Carrier, and for purposes of Section
3.a.(1) hereof, the applicable mark up shall be as indicated below.
(1) [Confidential Portion Deleted]
(2) [Confidential Portion Deleted]
4
45
(3) [Confidential Portion Deleted]
(4) [Confidential Portion Deleted]
(5) [Confidential Portion Deleted]
(6) [Confidential Portion Deleted]
(7) [Confidential Portion Deleted]
5
46
(8) [Confidential Portion Deleted]
d. In addition to the payment referred to in Section 3.a. hereof, the
Carrier shall pay the Handling Company a fee for the use of non-incremental
facility space equal to one half the difference between (i) the monthly cost of
rent and facility maintenance and operating charges that the Carrier incurred
prior to the Handling Company's commencing providing Services for the Carrier at
a location and (ii) the monthly direct cost of incremental facilities plus any
amount of monthly rent and facility maintenance and operating cost that the
Carrier is required to pay at such location for space that is not being used as
a result of the Handling Company's providing Services for the Carrier.
e. Handling in the case of technical landings for other than commercial
purposes will be charged at 50% of the average turn rate provided that a
physical change of load is not involved.
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47
f. Handling in case of return to ramp will not be charged extra, provided
that a physical change of load is not involved.
g. Handling in case of return to ramp involving a physical change of load
will be charged in the same manner as in the case of technical landing in
accordance with Sub-Paragraph 3.e.
h. The Carrier will reimburse the Handling Company for any overtime expense
incurred as a result of the Carrier operating a flight, the actual departure
time of which is more than two (2) hours later than scheduled departure time.
Labor rates to be used will be listed in Annex B.
4. CHANGE EVENTS. The costs set forth in Exhibit B, as well as those set
forth in this Agreement will be reviewed and adjusted, if necessary, at the
conclusion of every six month period, upon the occurrence of a schedule change
by Carrier, Handling Company or any material change in Handling Company's
labor cost (collectively, the events giving rise to an adjustment in cost
are referred to as "Change Events").
5. EQUIPMENT. The Carrier shall be responsible for providing to the
Handling Company any incremental ground equipment necessary for the Handling
Company to be able to perform Services for the Carrier at a location. The
Handling Company shall maintain the ground equipment in the same manner that it
maintains its own
7
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ground equipment. The Carrier shall pay the maintenance and operating expense
for such Carrier supplied ground equipment in accordance with section 3.c(2)
hereof. Such Carrier supplied ground equipment shall at all times be considered
the property of Carrier.
6. FORMAL AGREEMENT. At such time as the airlines agree on the Services
that will be provided at a location, the airlines will execute an agreement
substantially in the form of Exhibit B which is the 1993 version of the Standard
Ground Handling Agreement (SGHA), Simplified Procedure, published by the
International Air Transport Associations (IATA). Exhibit B sets forth the
general terms and conditions upon which each airline will provide Services to
the other airline.
7. INDEPENDENT PARTIES. It is expressly recognized and agreed that each
airline, in its performance and otherwise under this Agreement, is and shall be
engaged and acting as an independent contractor and in its own independent and
separate business; that each airline shall retain complete and exclusive control
over its staff and operations and the conduct of its business; and that each
airline shall bear and pay all expenses, costs, risks and responsibilities
incurred by it in connection with its obligations under this Agreement. Neither
CAL nor AWA nor any officer, employee, representative, or agent of CAL or AWA
shall in any manner, directly or indirectly, expressly or by implication, be
8
49
deemed to be, or make any representation or take any action which may give rise
to the existence of, any employment, agent, partnership, or other like
relationship as between CAL and AWA but each airline's relationship as respects
the other airline in connection with this Agreement is and shall remain that of
an independent contractor.
8. TERM AND TERMINATION.
a. Term. Unless the airlines agree to an earlier commencement date, the
term of this Agreement shall commence as soon as practicable after the date that
is the later of the date that this Agreement is signed by both parties or the
date that the investment agreement between AWA and AmWest Partners, L.P. (the
"Investment Agreement") is consummated and shall continue until the date
immediately preceding the tenth anniversary of the commencement date, unless
earlier terminated as provided herein, and shall continue thereafter until
either airline gives the other airline notice of termination at least 90 days
prior to the effective date of such termination. In no event shall termination
or expiration pursuant to this Section 7a be effective unless such 90 days'
notice is provided.
b. Termination as a Result of Changes of Law. In the event there is any
change in treaties, statutes or regulations of air transportation that
materially affects the rights and/or obligations presently in force with respect
to the air
9
50
transportation services of CAL or AWA or both, relating to CO* or HP* Flights,
then the airlines will consult, within 30 days after any of the occurrences
described herein, in order to determine or seek mutual agreement as to what, if
any changes to this Agreement are necessary or appropriate, including but not
limited to the early termination and cancellation of this Agreement.
c. Other Termination Rights. In addition to any other provisions of this
Agreement, this Agreement may be terminated, without liability, as follows:
(1) By either airline on 30 days' prior written notice, if the other
airline has breached any material provision of this Agreement unless such
other airline cures such breach within such 30 day period;
(2) By either airline immediately on notice, if the other airline
shall be dissolved or shall fail to maintain its corporate existence in
good standing, or shall have its authority to operate as a scheduled
airline suspended or revoked, or shall cease operations as a scheduled
airline.
(3) By either airline immediately on notice, in the event that the
commencement date of this Agreement is prior to the date that the
Investment Agreement is consummated if the Investment Agreement is
terminated prior to this having been consummated.
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(4) Except to AWA's currently pending Chapter 11 proceeding, by either
airline if a petition is filed by or against the other airline under bankruptcy
law, or any other law providing for the relief of debtors, and the affected
party does not succeed in having such petition lifted or stayed within sixty
days from the date of entry; either airline, at its option, may cancel this
Agreement immediately and exercise such other remedies as may be available at
law and/or in equity
(5) By either airline on six month's prior written notice, if an airline,
foreign or domestic, that competes with the terminating airline on a material
basis, acquires majority ownership of or substantial control over the other
airline.
9. ENTIRE AGREEMENT WAIVERS AND AMENDMENTS. This Agreement, together with
any Annex Agreements as set forth in the format demonstrated in Exhibit B,
constitutes the entire understanding of the airlines with respect to the subject
matter hereof superseding all prior discussions and agreements, written or oral.
This Agreement may not be amended, nor may any of its provisions be waived,
except by writing signed by both airlines. No delay on the part of either
airline in exercising any right power or privilege hereunder shall operate as a
waiver hereof, nor shall any waiver operate as a continuing waiver of any right,
power or privilege.
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10. NOTICES. All notices given hereunder shall be in writing delivered by
hand, certified mail, telex, or telecopy to the airlines at the following
addresses:
If to CAL:
Continental Airlines, Inc. Telephone No.: 713-834-2950
2929 Allen Parkway Telephone No.: 713-520-6329
Houston, Texas 77019
Attention: Vice Chairman & CEO
With copy to:
Continental Airlines, Inc. Telephone No.: 713-834-5149
2929 Allen Parkway Telephone No.: 713-834-5161
Houston, Texas 77019
Attention: Senior Vice President
and General Counsel
If to AWA:
America West Airlines, Inc. Telephone No.: 602-693-5880
4000 E. Sky Harbor Blvd. Telephone No.: 602-693-5950
Phoenix, Arizona 85034
Attention: President & CEO
With copy to:
America West Airlines, Inc. Telephone No.: 602-693-5750
4000 E. Sky Harbor Blvd. Telephone No.: 602-693-5904
Phoenix, Arizona 85034
Attention: Sr. Vice President and
General Counsel
11. SUCCESSORS AND ASSIGNS. Neither airline may assign its rights or
delegate its duties under this Agreement without the prior written consent of
the other airline, and any such purported assignment or delegation shall be
void. This Agreement shall be binding on the lawful successors of each airline.
12
53
12. SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
13. HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
14. COUNTERPARTS. This Agreement may be executed in counterparts, all of
which taken together shall constitute one agreement.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of New York without reference to principles
of choice or conflicts of law.
16. EQUAL OPPORTUNITY. EEO clauses contained at 11 C.F.R. #60-1.4, 60-250.4
and 60-741.4 are hereby incorporated by reference. Each party shall comply with
all equal opportunity laws and regulations which apply to or must be satisfied
by that party as a result of this Agreement.
17. HANDLING STANDARDS. The Handling Company agrees to provide services in
accordance with the minimum standards as
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54
outlined in Exhibit B. Failure to maintain these performance standards in every
category for a calendar month will result in a reduction of the charges of five
percent for the period; likewise, if the minimum standards are exceeded in every
category a five percent incentive bonus will be awarded the handling company.
Following are the standards:
a. Standards for cities where the Carrier has under 25 flights per day:
[Confidential Portion Deleted]
18. SETTLEMENT OF ACCOUNTS. The Handling Company shall present invoices to
the Clearing House (ACH) monthly in arrears for all services performed.
Concurrently therewith, the Handling Company shall send or deliver copies of
such invoices to the Carrier's local station manager. The Carrier shall not
oppose clearance of any invoice by the Clearing House, but reserve the right to
subsequently adjust any difference which may arise in
14
55
connection therewith, provided such adjustments are in accordance with ACH
rules.
19. DISPUTE RESOLUTION. In the event that the Handling Company does not
perform to the standards set forth in this Agreement, the Carrier and Handling
Company agree to resolve any service dispute as follow:
a. First, the field representatives of both Carrier and the Handling
Company shall negotiate in good faith to resolve any service standard dispute.
b. Second, if such dispute is not resolved within ten days by the field
representative, the Carrier and the Handling Company will schedule a
review committee meeting consisting of senior management personnel
authorized to resolve the dispute.
20. TRANSFER OF SERVICES. The Handling Company may subcontract certain
services to be provided hereby only with the prior written consent of the
Carrier, which will not be unreasonably withheld. The Carrier will reimburse the
Handling Company for the expense of such subcontract at cost plus 10%.
21. FLIGHT SCHEDULE. Each airline will provide the other airline with 90
days' prior notice (or notice as far in advance as possible if 90 days is
impracticable) of any change by it to the flight schedule established pursuant
to Annex B hereto. Upon notice of a schedule change, the airlines shall attempt
to resolve any problems that result from such change in a commercially
15
56
reasonable manner so that the detrimental effects of such change are minimized.
If after the airlines attempt to resolve such problems, the schedule change is
unacceptable to the Carrier, the Carrier may terminate the agreement applicable
to the location on 30 days notice delivered no later than 30 days after the
schedule change.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
CONTINENTAL AIRLINES INC. AMERICA WEST AIRLINES, INC.
/s/ Charles /s/ Marty J. Whalen
BY: ___________________________________ BY: ___________________________________
/s/ Exec. Vice President Sr. Vice President
TITLE: ___________________________________ TITLE: ___________________________________
August 25, 1994 August 25, 1994
DATE: ___________________________________ DATE: ____________________________________
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EXHIBIT A
LOCATIONS
[confidential portion deleted]
17
58
EXHIBIT B
STANDARD GROUND HANDLING AGREEMENT -- SIMPLIFIED PROCEDURE
ANNEX B.1.1 -- LOCATION(S), AGREED SERVICES, FACILITIES AND CHARGES
to the Standard Ground Handling Agreement (SGHA) of April 1993
between: AMERICA WEST AIRLINES, INC.
having its principal office at:
4000 E. Sky Harbor Boulevard
Phoenix, Arizona 85034,
and hereinafter referred to as the ["Carrier" or
"Handling Company"]
and: CONTINENTAL AIRLINES, INC.
having its principal office at:
2929 Allen Parkway
Houston, Texas 77019,
and hereinafter referred to as the ["Handling
Company" or "Carrier"]
effective from:
This Annex for the location [Location where Carrier will provide Ground
Handling for the other Carrier]
is valid from and replaces:
PREAMBLE: This Annex B is prepared in accordance with the simplified procedure
whereby the Carrier and the Handling Company agree that the terms of the Main
Agreement and Annex A of the SGHA of April 1993 as published by the
International Air Transport Association shall apply as if such terms were
repeated here in full. The terms of the Master Ground Handling Agreement between
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59
America West Airlines, Inc. and Continental Airlines Inc., dated August 22,
1994, also applies as if such terms were repeated here in full and in cases of
conflict supersede the terms of the SGHA.
PARAGRAPH 1. HANDLING CHARGES
1.1 The Handling company shall provide the services of Annex A enumerated below
for the Carrier's scheduled operations:
[List of Services to be Provided]
1.2 Handling Fee
1.2.1 For the performance of services enumerated in Sub-Paragraph 1.1, the
Handling Company shall charge the Carrier the following monthly fee
such as has been calculated in accordance to the pricing standards as
recorded in the Master Agreement.
$ /Flight
or a monthly minimum of
$ /Month
whichever is greater.
(List any additional Handling Fees here which apply from the Main Agreement.)
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PARAGRAPH 2. ADDITIONAL SERVICES
2.1 (List additional services not recorded in 1.1)
2.2 Handling Fees:
2.2.1 (List fees for additional services here. All fees listed should
be consistent with the fee structure stated in the Master
Handling Agreement.)
PARAGRAPH 3. FACILITY SPACE
3.1 (List facility space provided here.)
3.2 (List cost of facility space.)
PARAGRAPH 4. FLIGHT SCHEDULE
4.1 Effective dates
4.2 A/C FREO ETA ETD FREO A/C
PARAGRAPH 5. HANDLING STANDARDS
Incentive Penalty
Station On-Time Departures
First Flight On-Time Departures
Mishandled Baggage
Aircraft Damage
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PARAGRAPH 6. DURATION, MODIFICATION AND TERMINATION
6.1 Notwithstanding the provisions of Paragraph 8 Term and Termination, of
the Master Ground Handling Agreement, this Annex shall remain in effect for a
period of two years from the date that this Annex is effective and shall remain
in effect thereafter until cancelled by either party upon 60 days notice of such
cancellation. In addition to the rights that either party may have pursuant to
the termination provisions of the Master Ground Handling Agreement, either party
may cancel this Annex if the party ceases operations at the airport where the
services are being provided hereunder, in the case of "Change of Events" the
amended price is such that the Carrier wishes to terminate the Agreement, the
Handling Company is unable to meet the agreed upon Handling Standards of the
Carrier or by the Handling Company if the Handling Company's operations at the
airport where the services are being provided hereunder are reduced to such and
extent that the maintenance of ground handling capabilities is no longer
prudent.
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IN WITNESS WHEREOF, the parties hereto have each caused this Annex B to be
signed and delivered by its duly authorized officer, as of the date indicated
below.
CONTINENTAL AIRLINES, INC. AMERICA WEST AIRLINES, INC.
By: By:
- - --------------------------------- ---------------------------------
Title: Title:
- - --------------------------------- ---------------------------------
Date: Date:
- - --------------------------------- ---------------------------------
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Exhibit C
Airport Handling Manual
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AHM 810 -- ANNEX A
IATA STANDARD GROUND HANDLING AGREEMENT (APRIL 1993)
STANDARD GROUND HANDLING AGREEMENT
ANNEX A -- GROUND HANDLING SERVICES
to the Standard Ground Handling Agreement
effective from:
between:
hereinafter referred to as "the Carrier" or "the Handling Company", as the case
may be,
and:
hereinafter referred to as "the Handling Company" or "the Carrier", as the case
may be.
This Annex A
is valid from:
and replaces:
TABLE OF CONTENTS
DEFINITIONS
SECTION 1. REPRESENTATION AND ACCOMMODATION
1.1 General
1.2 Disbursements
1.3 Accommodation
SECTION 2. LOAD CONTROL AND COMMUNICATIONS
2.1 Load Control
2.2 Communications
SECTION 3. UNIT LOAD DEVICE CONTROL
3.1 Handling
3.2 Administration
SECTION 4. PASSENGERS AND BAGGAGE
4.1 General
4.2 Departure
4.3 Arrival
4.4 Baggage Handling
4.5 Remote/Off Airport Services
SECTION 5. CARGO AND MAIL
5.1 Cargo Handling -- General
5.2 Export Cargo
5.3 Import Cargo
5.4 Transfer Cargo
5.5 Post Office Mail
SECTION 6. RAMP
6.1 Marshalling
6.2 Parking
6.3 Ramp to Flight Deck Communication
6.4 Loading and Unloading
6.5 Starting
6.6 Safety Measures
6.7 Moving of Aircraft
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AHM 810 -- ANNEX A (CONTINUED)
SECTION 7. AIRCRAFT SERVICING
7.1 Exterior Cleaning
7.2 Interior Cleaning
7.3 Toilet Service
7.4 Water Service
7.5 Cooling and Heating
7.6 Snow and Ice Removal
7.7 Cabin Equipment
7.8 Storage of Cabin Material
SECTION 8. FUEL AND OIL
8.1 Fuelling and/or Defuelling
8.2 Replenishing of Oils and Fluids
SECTION 9. AIRCRAFT MAINTENANCE
9.1 Routine Services
9.2 Non-routine Services
9.3 Material Handling
9.4 Parking and Hangar Space
SECTION 10. FLIGHT OPERATIONS AND CREW ADMINISTRATION
10.1 General
10.2 Flight Preparation at the Airport of Departure
10.3 Flight Preparation at a Point Different from the Airport of
Departure
10.4 In-flight Assistance
10.5 Post-flight Activities
10.6 In-flight Re-despatch
10.7 Crew Administration
SECTION 11. SURFACE TRANSPORT
11.1 General
11.2 Special Transport
SECTION 12. CATERING SERVICES
12.1 Liaison and Administration
12.2 Catering Ramp Handling
12.3 Storage
12.4 Cleaning Services
12.5 Preparation
SECTION 13. SUPERVISION AND ADMINISTRATION
13.1 Supervisory Functions
13.2 Administrative Functions
SECTION 14. SECURITY
14.1 Passengers and Baggage
14.2 Cargo and Mail
14.3 Catering
14.4 Aircraft, Ramp and Other Designated Areas
14.5 Additional Security Services
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AHM 810 -- ANNEX A (CONTINUED)
DEFINITIONS
For the sake of clarity, the following definitions apply:
AIRPORT TERMINAL means all buildings used for arrival and departure
handling of aircraft.
ARRANGE (or MAKE ARRANGEMENTS FOR) implies that the Handling Company may
request an outside agency to perform the service in question. The charge of
the outside agency shall be paid by the Carrier. The Handling Company
assumes no liability toward the Carrier for such arrangements.
CARGO includes the Carrier's service cargo and company mail.
LOADS means baggage, cargo, mail and any aircraft supplies including
ballast.
AS MUTUALLY AGREED or BY MUTUAL AGREEMENT, it is recommended that, whenever
this terminology is used, such items be supported by specific documentation
or reference.
OWNING CARRIER means a carrier who is the owner or lessee of a Unit Load
Device.
PASSENGERS includes the Carrier's service and free passengers.
PROVIDE implies that the Handling Company itself assumes responsibility for
the provision of the service in question.
RECEIVING CARRIER means a carrier who receives a Unit Load Device from a
transferring carrier at a transfer point.
TECHNICAL LANDING is a landing for other than commercial reasons where no
physical change of load occurs.
TRANSFERRING CARRIER means a carrier who transfers a Unit Load Device to a
receiving carrier at a transfer point.
TRANSIT FLIGHT is an aircraft making an intermediate landing for commercial
reasons where a change of load occurs.
TRUCK HANDLING means loading and/or unloading a truck operating as a Truck
Service.
TRUCK SERVICE means a service operated by truck on behalf of an airline
carrying loads documented in accordance with the applicable IATA and/or
ICAO rules, regulations and procedures.
In the Main Agreement and in Annex A, the word "aircraft" will read "truck"
and "flight" will read "truck service" when it concerns the handling of a
truck as meant under the above definitions.
In Section 5, Sub-Section 5.3.1(a) of Annex A, the word "vehicle" means a
conveyance of any kind to be used within the ramp area for transport of
cargo between warehouse and truck or between two trucks or between two
warehouses.
TURNROUND FLIGHT is an aircraft terminating a flight and subsequently
originating another flight following a complete change of load.
UNIT LOAD DEVICES (ULDs) means devices which interface directly with an
aircraft restraint system and are registered by the IATA ULD Technical
Board.
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AHM 810 -- ANNEX A (CONTINUED)
SECTION 1. REPRESENTATION AND ACCOMMODATION
1.1 General
1.1.1 If required, arrange guarantee or bond to facilitate the Carrier's activities. Cost
for provisions of such guarantee or bond may be recharged to the Carrier.
1.1.2 Liaise with local authorities.
1.1.3 Indicate that the Handling Company is acting as handling agent for the Carrier.
1.1.4 Inform all interested parties concerning movements of the Carrier's aircraft.
1.2 Disbursements
1.2.1 As mutually agreed, pay, on behalf of the Carrier, airport, customs, police and other
charges relating to the services performed.
1.2.2 As mutually agreed, pay, on behalf of the Carrier, out-of-pocket expenses, for
example, accommodation, transport and catering charges.
1.2.3 As mutually agreed, pay Denied Boarding Compensation on behalf of the Carrier.
1.3 Accommodation
1.3.1 Provide office space for accommodation of the Carrier's representative(s).
SECTION 2. LOAD CONTROL AND COMMUNICATIONS
2.1 Load Control
2.1.1 Convey and deliver flight documents between the aircraft and appropriate airport
buildings.
2.1.2 (a) Prepare
(b) Sign
(c) Distribute
(d) Clear
(e) File
as appropriate, documents, for example, loading instructions, loadsheets, balance
charts, Captain's load information and manifests, in accordance with local or
international regulations or as reasonably required by the Carrier.
2.1.3 (a) Compile
(b) Despatch
statistics, returns and reports, as mutually agreed.
2.2 Communications
2.2.1 (a) Compile
(b) Despatch and receive
all messages in connection with the services performed by the Handling Company, using
the Carrier's originator code or double signature procedure, as applicable. Inform
the Carrier's representative of the contents of such messages. Charges for
transmitting messages may be recharged to the Carrier.
2.2.2 Maintain a message file containing all above mentioned messages pertaining to each
flight for ninety days.
2.2.3 (a) Provide
(b) Operate
suitable means of communication between the ground station and the Carrier's
aircraft.
SECTION 3. UNIT LOAD DEVICE CONTROL
3.1 Handling
3.1.1 (a) Provide
or
(b) Arrange for
suitable storage space for Unit Load Devices, as mutually agreed.
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AHM 810 -- ANNEX A (CONTINUED)
3.1.2 Apply correct storage and handling techniques in accordance with the Carrier's
requirements.
3.1.3 Take appropriate action to prevent theft or unauthorized use of, or damage to the
Carrier's Unit Load Devices in the custody of the Handling Company. Notify the
Carrier immediately of any damage to or loss of such items.
3.2 Administration
3.2.1 Maintain a stock record of all Unit Load Devices received and despatched in a
suitable manner, as mutually agreed.
3.2.2 Issue Control Receipts when Unit Load Devices are transferred to or from the owning
carrier on the instructions of the delivering carrier.
3.2.3 Compile and despatch Stock Check Messages (SCM), as mutually agreed.
3.2.4 Compile and despatch Unit Load Device Control Messages (UCM), according to UCM
procedure.
3.2.5 Prepare Unit Load Device Receipt (LUC) for all transfers of Unit Load Devices and
obtain signature(s) of the transferring and receiving carrier(s) or approved third
parties and distribute copies according to the Carrier's Instructions.
3.2.6 Handle lost, found and damaged Unit Load Device matters and notify the Carrier of
such irregularities.
SECTION 4. PASSENGERS AND BAGGAGE
4.1 General
4.1.1 Inform passengers and/or public about time of arrival and/or departure of Carrier's
aircraft and surface transport.
4.1.2 Make arrangements for stopover, transfer and transit passengers and their baggage and
inform them about services available at the airport.
4.1.3 When requested by the Carrier,
(a) provide
or
(b) arrange for
special equipment, facilities and specially trained personnel, as available, for
assistance to
(1) unaccompanied minors.
(2) disabled passengers.
(3) VIPs.
(4) transit without visa passengers (TWOVs).
(5) deportees.
(6) others, as specified.
Additional costs may be recharged to the Carrier.
4.1.4 Take care of passengers when flights are interrupted, delayed or cancelled, according
to instructions given by the Carrier. If instructions do not exist, deal with such
cases according to the practice of the Handling Company.
4.1.5 If applicable, arrange storage of baggage in the Customs' bonded store if required
(any fees to be paid by the passenger).
4.1.6 Notify the Carrier of complaints and claims made by the Carrier's clients and, by
special arrangement, process such claims, as mutually agreed.
4.1.7 Handle lost, found and damaged property matters, as mutually agreed.
4.1.8 Report to the Carrier any irregularities discovered in passenger and baggage
handling.
4.1.9 Make available the Handling Company's special lounge facilities, as specified in
Annex(es) B.
4.1.10 (a) Provide
or
(b) Arrange for
personnel and/or facilities for porter service.
4.2 Departure
4.2.1 Check and ensure that tickets are valid for the flight(s) for which they are
presented. The check shall not include the fare.
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AHM 810 -- ANNEX A (CONTINUED)
4.2.2 By mutual agreement, check travel documents (passports, visas, vaccination and other
certificates) for the flight(s) concerned, but without the Handling Company having
any liability.
4.2.3 (a) Weigh and/or measure (as applicable), and tag checked and unchecked baggage.
(b) Effect the conveyance of checked baggage from the baggage check-in position to
the baggage sorting area.
Additional costs for baggage requiring special handling may be recharged to the
Carrier.
4.2.4 Enter baggage figures on passengers' ticket(s), detach applicable flight coupon(s)
and issue boarding pass(es)
(a) for initial flight.
(b) for subsequent flight(s).
4.2.5 By mutual agreement, make out excess baggage ticket(s), collect excess baggage
charge(s) and detach applicable excess baggage coupon(s).
4.2.6 Where applicable, collect Airport Service Charges from departing passengers
accounting therefor to the appropriate authorities.
4.2.7 Carry out the Carrier's seat allocation or selection system
(a) for initial flight.
(b) for subsequent flight(s).
4.2.8 Direct passengers through controls to the aircraft.
4.2.9 Carry out head check of passengers upon embarkation. (Count to be compared with
aircraft documents.)
4.2.10 Handle Denied Boarding Compensation cases, as agreed with the Carrier.
4.2.11 Provide facility for accepting and processing of unaccompanied baggage.
4.3 Arrival
4.3.1 Direct passengers from aircraft through controls to the terminal landside area.
4.3.2 Deliver baggage in accordance with local procedures.
4.4 Baggage Handling
4.4.1 Handle baggage in the baggage sorting area.
4.4.2 Prepare for delivery onto flights
(a) bulk baggage.
(b) Unit Load Devices.
4.4.3 Establish the weight of built-up Unit Load Devices.
4.4.4 (a) Offload bulk baggage from vehicles.
(b) Break down and/or empty Unit Load Devices.
(c) Check incoming baggage for transfer connections.
4.4.5 (a) Sort transfer baggage.
(b) Store transfer baggage for a period to be mutually agreed prior to despatch.
4.4.6 (a) Provide
or
(b) Arrange for
transport of transfer baggage to the sorting area of the receiving carrier.
4.4.7 Handle crew baggage, as mutually agreed.
4.5 Remote/Off Airport Services
4.5.1 Inform passengers/public about time of arrival/departure.
4.5.2 Receive departing passengers and baggage.
4.5.3 Carry out passenger and baggage handling as described in Sub-Sections 4.1 and 4.2,
where applicable.
4.5.4 Direct departing passengers to connecting transport to the airport.
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AHM 810 -- ANNEX A (CONTINUED)
4.5.5 Receive passengers ex transport from the airport.
4.5.6 Deliver baggage to passengers in accordance with local procedures.
SECTION 5. CARGO AND MAIL
5.1 Cargo Handling -- General
Physical Handling
5.1.1 (a) Provide facilities for handling of cargo, protecting cargo from weather.
(b) Take appropriate action to prevent theft of, or damage to, cargo.
5.1.2 Provide, as locally available, essential equipment and storage facilities for
perishables, live animals, valuables, news films, dangerous goods and other special
shipments.
5.1.3 Store cargo for a period to be mutually agreed.
5.1.4 Obtain receipt upon delivery of cargo.
Document Handling
5.1.5 Check all documents to ensure shipment may be carried in accordance with the
Carrier's requirements. The check shall not include the rates charged.
Customs Control
5.1.6 Place cargo under Customs control, if required, and clear discrepancies in accordance
with local regulations.
5.1.7 Present to Customs, as required, cargo for physical examination.
Irregularities Handling
5.1.8 Take immediate action in accordance with the Carrier's and/or local authorities'
instructions in respect of irregularities, damage or mishandling of dangerous goods
and other special shipments.
5.1.9 Report to the Carrier any irregularities discovered in cargo handling.
5.1.10 Handle lost, found and damaged cargo matters, as mutually agreed.
5.1.11 (a) Notify the Carrier of complaints and claims, giving supporting data.
(b) Process such claims, as mutually agreed.
Miscellaneous
5.1.12 Take appropriate action to prevent theft or unauthorised use of, or damage to the
Carrier's pallets, containers, nets, straps, tie-down rings and other material in the
custody of the Handling Company. Notify the Carrier immediately of any damage to or
loss of such items.
5.1.13 (a) Provide
or
(b) Arrange for
handling of specialised cargo products, as mutually agreed.
5.1.14 Handle diplomatic mail, as mutually agreed.
5.1.15 Handle company mail, as mutually agreed.
5.2 Export Cargo
Physical Handling
5.2.1 Accept cargo in accordance with the Carrier's instructions, ensuring that
(a) shipments are "ready for carriage".
(b) the weight and volume of the shipments are checked.
5.2.2 Tally and assemble for despatch, cargo up to capacity available on the Carrier's
flights.
5.2.3 Prepare
(a) bulk cargo
(b) Unit Load Devices
for delivery onto flights.
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AHM 810 -- ANNEX A (CONTINUED)
5.2.4 Establish the weight of
(a) bulk load
(b) built-up Unit Load Devices
and provide the load control unit with deadload weights.
Document Handling
5.2.5 (a) Prepare cargo manifests.
(b) Provide the load control unit with Special Load Notification, as required.
(c) Split air waybill sets. Forward applicable copies of manifests and air waybills,
as mutually agreed.
(d) Where applicable, return copy of air waybill to shipper, endorsed with flight
details.
Customs Control
5.2.6 Obtain Customs export clearance.
5.2.7 Prepare Customs documentation, for example, for cross-border truck services, as
mutually agreed.
5.3 Import Cargo
Physical Handling
5.3.1 (a) Offload bulk cargo from vehicles, when applicable.
(b) Break down and/or empty Unit Load Devices.
(c) Check incoming cargo against air waybills and manifests.
5.3.2. Release cargo to the consignee or agent upon proper release by Customs and other
government agencies, as required.
Document Handling
5.3.3 Notify consignee or agent of arrival of shipments in accordance with applicable
instructions.
5.3.4 (a) Provide
or
(b) Arrange for
facilities for collection of "Charges Collect" as shown on the air waybills and
extend credit to consignees or agents, as mutually agreed.
Irregularities Handling
5.3.5 Take action in accordance with applicable instructions when consignee refuses
acceptance or payment.
5.4 Transfer Cargo
5.4.1 Identify transfer cargo.
5.4.2 Prepare transfer manifests for cargo to be transported by another carrier.
5.4.3 (a) Provide
or
(b) Arrange for
transport to the receiving carrier's warehouse on or in the close proximity of the
airport of arrival, of transfer cargo under cover of Transfer Manifest.
5.4.4 Accept/prepare transfer cargo for onward carriage.
5.5 Post Office Mail
Physical Handling
5.5.1 Check incoming mail against Post Office mail documents.
5.5.2 Deliver mail to postal authorities against Post Office mail documents for receipt.
5.5.3 Accept and check outgoing mail from postal authorities against Post Office mail
documents receipt.
5.5.4 Handle transfer mail.
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AHM 810 -- ANNEX A (CONTINUED)
Document Handling
5.5.5 Distribute Incoming/outgoing Post Office mail documents.
Irregularities Handling
5.5.6 Handling lost, found and damaged mail matters and report all irregularities to the
Carrier and postal authorities in accordance with local practices.
5.5.7 Maintain a file on all mail matters including irregularities for a period to be
mutually agreed.
SECTION 6. RAMP
6.1 Marshalling
6.1.1 (a) Provide
or
(b) Arrange for
marshalling at arrival and/or departure.
6.2 Parking
6.2.1 (a) Provide
(b) Position and/or remove
wheelchocks.
6.2.2 Position and/or remove
(a) landing gear locks.
(b) engine blanking covers.
(c) pilot covers.
(d) surface control locks.
(e) tallstands and/or aircraft tethering
6.2.3 (a) Provide
(b) Position and remove
(c) Operate
suitable ground power unit for supply of necessary electrical power. Any time limit
to be specified in Annex(es) B.
6.3 Ramp to Flight Deck Communication
6.3.1 Provide headsets.
6.3.2 Perform ramp to flight deck communication
(a) during tow-in and/or push-back.
(b) during engine starting.
(c) for other purposes.
6.4 Loading and Unloading
6.4.1 (a) For a period to be mutually agreed, provide
(b) Position and remove
(1) suitable passenger steps.
(2) suitable loading bridges.
(3) flight deck steps.
6.4.2 Provide
(a) passenger
(b) crew
transport between aircraft and airport terminals.
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AHM 810 -- ANNEX A (CONTINUED)
6.4.3 (a) Provide
(b) Operate
suitable equipment for loading and/or unloading.
6.4.4 (a) Provide
(b) Operate
suitable equipment for transport of loads between agreed points on the airport, as
required. (Equipment to be released and/or made available, as mutually agreed.)
6.4.5 Assemble/deliver/receive loads
6.4.6 (a) Unload loads from aircraft, returning lashing materials to the Carrier.
(b) Load, stow and secure loads in the aircraft in accordance with the Carrier's
instructions and procedures. (Lashing materials may be charged at cost.)
(c) Operate in-plane loading system in accordance with the Carrier's instructions.
6.4.7 Load, stow and secure perishables, live animals, valuables, news films, dangerous
goods and other special shipments in accordance with the Carrier's instructions.
6.4.8 Redistribute loads in aircraft according to Carrier's instructions.
6.4.9 (a) Open and secure aircraft hold doors.
(b) Secure and lock aircraft hold doors when loading is complete.
6.4.10 Refill the Carrier's ballast bags with ballast approved by the Carrier.
6.4.11 Provide filled ballast bags
6.4.12 Arrange for safeguarding of all loads with special attention to valuables and
vulnerable cargo during loading/unloading and during transport between aircraft and
airport terminal(s).
6.5 Starting
6.5.1 (a) Provide
(b) Position and remove
(c) Operate
appropriate unit(s) for engine starting.
6.5 Safety Measures
6.6.1 (a) Provide
(b) Position and remove
(c) Operate
suitable fire-fighting equipment and other protective equipment, as required.
6.7 Moving of Aircraft
6.7.1 (a) Provide
(b) Position and remove
suitable tow-in and/or push-back equipment. (Towbar to be provided by the Carrier
unless otherwise agreed.)
(c) Tow in and/or push back aircraft according to the Carrier's instructions.
(d) Tow aircraft between other agreed points according to the Carrier's instructions.
6.7.2 Move aircraft under its own power in accordance with the Carrier's instructions.
SECTION 7. AIRCRAFT SERVICING
7.1 Exterior Cleaning
7.1.1 Perform exterior cleaning of flight deck windows.
7.1.2 Perform reasonable cleaning of aircraft integral steps.
7.1.3 Wipe excess oil from engine nacelles and landing gear.
7.1.4 Clean wings, controls, engine nacelles and landing gear.
7.1.5 Clean cabin windows.
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AHM 810 -- ANNEX (CONTINUED)
7.2 Interior Cleaning
7.2.1 Clean and tidy flight deck according to the Carrier's instructions and, if specified,
under the control of a person authorised by the Carrier, by
(a) emptying ash trays.
(b) disposing of litter.
(c) clearing waste from seat back stowages and racks.
(d) wiping crew tables.
(e) cleaning and tidying seats.
(f) mopping floor.
(g) cleaning windscreen on inside, as requested.
7.2.2 Clean and tidy, as appropriate, by
(a) emptying ash trays
(b) disposing of litter
(c) clearing waste from seat back and over head stowages
(d) wiping tables
(e) cleaning and tidying seats and passenger service units
(f) cleaning the floors (carpets and surrounds)
(g) wiping surfaces in pantries, galleys (sinks and working surfaces) and toilets
(wash basins, bowls, seats, mirrors and surrounds)
(h) removing, as necessary, an contamination caused by airsickness, spilled food or
drink and offensive stains,
in
(1) crew compartments (other than flight deck).
(2) lounges.
(3) bars, pantries, galleys.
(4) passenger cabins.
(5) toilets.
(6) cloakrooms.
(7) vestibules.
7.2.3 Clean and tidy pantry/galley fixtures and empty and clean refuse bins.
7.2.4 Clean floor and floor covers extensively.
7.2.5 Clean cabin fixtures and fittings.
7.2.6 Clean cabin windows.
7.2.7 Clean
(a) cargo holds.
(b) cargo cabins.
(c) Unit Load Devices.
7.2.8 Fold and stow blankets.
7.2.9 Make up berths.
7.2.10 Change
(a) head rest covers
(b) pillow covers.
Covers to be supplied by the Carrier.
7.2.11 Distribute in
(a) cabin
(b) toilets
Items provided by the Carrier.
7.2.12 Disinfect and/or deodorize aircraft (materials may be supplied by the Carrier).
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AHM 810 -- ANNEX A (CONTINUED)
7.3 Toilet Service
7.3.1 (a) Provide
(b) Position and remove toilet servicing unit.
(c) Empty, clean, flush toilets and replenish fluids in accordance with the Carrier's
instructions.
7.4 Water Service
7.4.1 (a) Provide
(b) Position and remove water servicing unit.
(c) Replenish water tanks with drinking water, the standard of which is to meet the
Carrier's requirements.
7.5 Cooling and Heating
7.5.1 (a) Provide
(b) Position and remove.
(c) Operate cooling unit.
7.5.2 (a) Provide
(b) Position and remove.
(c) Operate heating unit.
7.6 Snow and Ice Removal
7.6.1 Remove snow from the aircraft without de-icing.
7.6.2 (a) Provide
(b) Position and remove.
(c) Operate de-icing unit.
7.7 Cabin Equipment
7.7.1 Rearrange cabin by
(a) removing
(b) installing
cabin equipment, for example, seats and cabin divider.
7.7.2 Handle in-flight entertainment matters, as mutually agreed.
7.8 Storage of Cabin Material
7.8.1 Provide suitable storage space for the Carrier's cabin material, as mutually agreed.
7.8.2 Take periodic inventory
7.8.3 (a) Provide
or
(b) Arrange for replenishment of stocks.
SECTION 8. FUELS AND OIL
8.1 Fuelling and/or Defuelling
8.1.1 Liaise with fuel suppliers.
8.1.2 (a) Inspect the Carrier's fuel product deliveries for contamination, prior to
storage, in accordance with the Carrier's instructions. Notify the Carrier of
results.
(b) Inspect fuel vehicles and/or appliances for contamination. Notify the Carrier of
results.
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AHM 810 -- ANNEX A (CONTINUED)
8.1.3 If applicable, supervise the placement of the Carrier's product into storage at
(a) the Handling Company's facility.
(b) a storage facility designated by the Carrier.
8.1.4 Supervise fuelling/defuelling operations.
8.1.5 Prepare aircraft for fuelling/defuelling.
8.1.6 Drain water from aircraft fuel tanks.
8.1.7 Receive the Carrier's product from storage in quantities requested.
8.1.8 (a) Provide
(b) Position, remove and operate
approved fuelling/defuelling equipment.
8.1.9 Fuel/defuel the aircraft with quantities of products requested by the Carrier's
designated representative.
8.1.10 Check and verify the delivered fuel quantity.
8.1.11 Deliver the completed fuel order(s) to the Carrier's designated representative.
8.1.12 Maintain records of all fuelling/defuelling operations and provide the Carrier with
an inventory and usage summary in accordance with the Carrier's instructions.
8.2 Replenishing of Oils and Fluids
8.2.1 Liaise with suppliers.
8.2.2 Perform or supervise replenishing operations.
8.2.3 (a) Provide
(b) Operate
special replenishing equipment.
SECTION 9. AIRCRAFT MAINTENANCE
9.1 Routine Services
9.1.1 Perform line inspection in accordance with the Carrier's current instructions.
9.1.2 Enter in the aircraft log and sign for the performance of the line inspection.
9.1.3 Enter remarks in the aircraft log regarding defects observed during the inspection.
9.1.4 Perform pre-flight check immediately before aircraft departure.
9.1.5 Provide skilled personnel to assist the flight crew or ground staff in the
performance of the inspection.
9.2 Non-routine Services
9.2.1 Rectify defects entered in the aircraft log as reported by the crew or revealed
during the inspection, to the extent requested by the Carrier.
However, major repairs must be especially agreed upon between the Carrier and the
Handling Company.
9.2.2 Enter in the aircraft log and sign for the action taken.
9.2.3 Report technical irregularities and actions taken to the Carrier's maintenance base
in accordance with the Carrier's instructions.
9.2.4 Maintain the Carrier's technical manuals, handbooks, catalogues, etc.
9.2.5 Provide engineering facilities, tools and special equipment to the extent available.
9.3 Material Handling
9.3.1 (a) Obtain Customs' clearance for
(b) Administer
the Carrier's spare parts, power plants and/or equipment.
9.3.2 Provide periodic inspection of the Carrier's spare parts and/or spare power plant.
9.3.3 Provide suitable storage space for the Carrier's spare parts and/or special
equipment.
9.3.4 Provide suitable storage space for the Carrier's spare power plant.
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Ground Handling Agreements
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AHM 810 -- ANNEX A (CONTINUED)
9.4 Parking and Hangar Space
9.4.1 (a) Provide
or
(b) Arrange for
suitable parking space.
9.4.2 (a) Provide
or
(b) Arrange for
suitable hangar space.
SECTION 10. FLIGHT OPERATIONS AND CREW ADMINISTRATION
10.1 General
10.1.1 Inform the Carrier of any known project affecting the operational services and
facilities made available to its aircraft in the areas of responsibility specified in
Annex(es) B.
10.1.2 Keep up-to-date all necessary manuals and instructions that the Carrier must provide
and ensure that all prescribed forms are available.
10.1.3 After consideration of the Carrier's instructions, suggest the appropriate action to
pilot-in-command in case of operational irregularities, taking into account the
meteorological conditions, the ground services and facilities available, aircraft
servicing possibilities and the overall operational requirements.
10.1.4 Maintain a trip file by collecting all documents specified by the Carrier, all
messages received or originated in connection with each flight and dispose of this
file as instructed by the Carrier.
10.2 Flight Preparation at the Airport of Departure
10.2.1 Arrange for the provision of the meteorological documentation and aeronautical
information for each flight.
10.2.2 Analyse the operational conditions and
(a) prepare or request
(b) sign
(c) make available
the operational flight plan according to the instructions and data provided by the
Carrier.
10.2.3 (a) Prepare or request
(b) Sign
(c) File
the Air Traffic Services (ATS) Flight Plan.
10.2.4 Furnish the crew with an adequate briefing.
10.2.5 (a) Prepare
(b) Sign
the fuel order.
10.2.6 Hand out flight operation forms as specified by the Carrier and obtain signature of
the pilot-in-command, where applicable.
10.2.7 Supply the appropriate local ground handling unit with the required weight and fuel
data.
10.2.8 (a) Obtain
(b) Monitor/Manage
the Carrier's slot time allocation with the appropriate ATS.
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Airport Handling Manual
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AHM 810 -- ANNEX A (CONTINUED)
10.3 Flight Preparation at a Point Different from the Airport of Departure
10.3.1 Analyse the operational conditions and
(a) prepare or request
(b) sign
(c) make available
the operational flight plan according to the instructions and data provided by the
Carrier.
10.3.2 Send to the Carrier or its representative at the airport of departure
(a) the operational flight plan
(b) the ATS Flight Plan
as specified in Annex(es) B, including information for crew briefing.
10.4 In-flight Assistance
10.4.1 Follow up the progress of the flight against flight movement messages, flight plan
messages and position reports received.
10.4.2 Provide information on flight progress to the Carrier's ground handling
representative.
10.4.3 Assist the flight as requested and/or deemed necessary to facilitate its safe and
efficient conduct in accordance with the flight plan.
10.4.4 Monitor movement of the flight within VHF range and provide assistance, as necessary.
10.4.5 Take immediate and appropriate action in case of in-flight irregularity, according to
the Carrier's instructions (written or verbal).
10.4.6 Log and notify as specified by the Carrier any incident of an operational nature
(delays, diversions, engine trouble, etc.).
10.4.7 Perform in-flight assistance, including re-despatch until adjacent area is able to
accept responsibility if, for reasons of communications failure, weather phenomena,
safety of aircraft or emergency it is undesirable to stop these services at the area
boundary specified in Annex(es) B. Similar conditions may make it desirable to
transfer these services to the next area before the area boundary is crossed.
10.4.8 Provide assistance to the flight, as required, beyond the VHF range.
10.5 Post-flight Activities
10.5.1 Obtain a debriefing from incoming crews, distributing reports or completed forms to
offices concerned, whether governmental or the Carrier's.
10.6 In-flight Re-despatch
10.6.1 Analyse meteorological information and the operational flight conditions for
re-despatch, calculating and planning it according to the data provided by the
aircraft in flight, and informing the pilot-in-command about the results thus
obtained.
10.7 Crew Administration
10.7.1 Perform crew administration services, as mutually agreed.
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Ground Handling Agreement
- - --------------------------------------------------------------------------------
AHM 810 -- ANNEX A (CONTINUED)
SECTION 11. SURFACE TRANSPORT
11.1 General
11.1.1 Make all necessary arrangements for the transport of
(a) crews
(b) passengers
(c) baggage
(d) cargo and/or mail
between
(1) airport and town terminal.
(2) airport and other agreed points.
(3) separate terminals at the same airport.
11.2 Special Transport
11.2.1 Make all necessary arrangements for special transport within the limit of local
possibilities.
SECTION 12. CATERING SERVICES
12.1 Liaison and Administration
12.1.1 Liaise with the Carrier's catering supplier.
12.1.2 Handle requisitions made by the Carrier's authorised representative.
12.1.3 Complete stock returns and other documentation.
12.1.4 Maintain stocks at agreed levels.
12.1.5 Pack and despatch catering items, as agreed.
12.2 Catering Ramp Handling
12.2.1 Unload/load and stow catering loads from/on aircraft.
12.2.2 Transfer catering loads on aircraft.
12.2.3 Transport catering loads between aircraft and agreed points.
12.3 Storage
12.3.1 Provide, according to the Carrier's requirements,
(a) bonded
(b) unbonded
(c) air conditioned
(d) cold
(e) deep freeze
storage accommodation.
12.3.2 Store the Carrier's
(a) spare catering equipment.
(b) consumable material.
(c) food stock.
(d) bar stock.
12.4 Cleaning Services
12.4.1 Empty, wash and clean removable catering equipment.
12.4.2 Arrange for cleaning and/or laundering of cabin blankets and linen.
12.4.3 Remove and, as required, destroy food and material left over from incoming flights in
accordance with local regulations and/or the Carrier's instructions.
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Airport Handling Manual
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AHM 810 -- ANNEX A (CONTINUED)
12.5 Preparation
12.5.1 Refill removable containers with hot and/or cold drinking water, the standard of
which is to meet the Carrier's requirements.
12.5.2 Prepare and assemble for delivery
(a) materials and unprocessed articles
(b) bar and/or catering supplies and other goods
in accordance with agreed specifications.
SECTION 13. SUPERVISION AND ADMINISTRATION (of services provided by others)
13.1 Supervisory Functions (pre-flight, on-flight and post-flight)
13.1.1 Attend at the airport as necessary to supervise and coordinate the ground handling
services contracted by the Carrier with third party(ies).
13.1.2 Cooperate with the Carrier's designated representative, as required.
13.1.3 Ensure that the handling company(ies) is (are) timely informed about operational
date, including alterations.
13.1.4 Check availability and preparedness of staff, equipment, supplies and services of the
Handling Company(ies) to perform the ground handling services.
13.1.5 Check preparation for documentation.
13.1.6 Ensure that prompt notification of the Carrier's requirements is given to all
interested parties.
13.1.7 Check that all loads including necessary documents will be ready in time to be loaded
on the flight.
13.1.8 Meet aircraft upon arrival and contact crew.
13.1.9 Receive briefing from crew and give information about irregularities, changes in
schedule or other matters.
13.1.10 Supervise and coordinate the ground handling services, deciding non-routine matters,
as required.
13.1.11 Check despatch of operational messages.
13.1.12 Check tracings of baggage, cargo, mail and lost and found articles. Follow up, if
necessary.
13.1.13 Note irregularities in station log and inform the Carrier's designated representative
in accordance with the relevant directives.
13.2 Administrative Functions
13.2.1 Establish and maintain local procedures in accordance with the Carrier's
requirements.
13.2.2 As required, take action on all communications addressed to the Carrier.
13.2.3 Prepare, forward and file reports/statistics/documents and perform any other
administrative duty that may be required by the Carrier or local conditions.
13.2.4 Maintain the Carrier's manuals, circulars, etc., connected with the performance of
the services.
13.2.5 Check and sign on behalf of the Carrier invoices, supply orders, handling charge
notes, work orders, etc., as agreed with the Carrier.
SECTION 14. SECURITY
14.1 Passengers and Baggage
14.1.1 (a) Provide
or
(b) Arrange for
(1) passenger interview,
(2) pre check-in/check-in procedures,
(3) pre boarding/boarding procedures,
as mutually agreed.
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Ground Handling Agreements
- - --------------------------------------------------------------------------------
AHM 810 -- ANNEX A (CONTINUED)
14.1.2 (a) Provide
or
(b) Arrange for
facilities for security clearance of baggage.
14.1.3 (a) Provide
or
(b) Arrange for
passenger and baggage reconciliation.
14.1.4 (a) Provide
or
(b) Arrange for
handling of unidentified baggage, as required.
14.1.5 (a) Provide
or
(b) Arrange for
security clearance of passenger and unchecked baggage.
14.1.6 (a) Provide
or
(b) Arrange for
baggage identification.
14.2 Cargo and Mail
14.2.1 (a) Provide
or
(b) Arrange for
security clearance upon acceptance.
14.2.2 (a) Provide
or
(b) Arrange for
(1) secure storage.
(2) physical examination.
(3) screening.
(4) decompression.
14.3 Catering
14.3.1 (a) Provide
or
(b) Arrange for
security services, as mutually agreed.
14.4 Aircraft, Ramp and Other Designated Areas
14.4.1 (a) Provide
or
(b) Arrange for
control of access to
(1) designated areas.
(2) aircraft.
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Airport Handling Manual
- - --------------------------------------------------------------------------------
AHM 810 -- ANNEX A (CONTINUED)
14.4.2 (a) Provide
or
(b) Arrange for
search of the aircraft.
14.4.3 (a) Provide
or
(b) Arrange for
security during transport of loads to/from the aircraft.
14.5 Additional Security Services
14.5.1 (a) Provide
or
(b) Arrange for
additional security services, as mutually agreed.
Signed the................................... Signed the...................................
at........................................... at...........................................
for and on behalf of......................... for and on behalf of.........................
by........................................... by...........................................
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MEMORANDUM OF UNDERSTANDING
CONCERNING TECHNOLOGY TRANSFERS
BETWEEN
CONTINENTAL AIRLINES, INC. ("CONTINENTAL")
AND AMERICA WEST AIRLINES, INC. ("AMERICA WEST")
1. PURPOSE:
The airline industry is heavily dependent on data processing technology and
the carriers must constantly refresh and update their automation base and
capabilities. Accordingly, Continental and America West expect to make
significant investments from time to time in application software development,
new technology services, and new technology implementation. Continental and
America West wish to take advantage of opportunities to co-fund the development
of new software applications. This Memorandum of Understanding ("MOU") is
intended to provide a conceptual foundation upon which the parties may agree to
jointly share in the development costs of new software applications or other
synergistic opportunities common to both in data processing technology.
2. SCOPE AND INTENT:
For purposes of this MOU, the term "Technology" shall mean applications
software and hardware, and/or telecommunications and other systems services,
and all documentation relating thereto. However, the term "Technology" shall
not include the CRS software or documentation or any other software or
documentation owned exclusively by System One or marketed by the Airline
Products and Services Division of EDS. Continental and America West each
understand and intend to make their technology available to the other party to
the extent contractually and legally permissible. Each party understands it
will be necessary to cooperate to achieve cost savings for future software
development and to realize operational synergies between both organizations.
All technology transfers shall be in accordance with and subject to the terms
and conditions to be specified for each technology transfer project.
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3. PROCEDURES:
Within ninety (90) days from the Effective Date, the parties will begin
substantive discussions to (i) develop a formal process for evaluating projects,
(ii) develop a mechanism to develop a procedure to track Technology transfers
and (iii) develop guidelines to identify the benefits that may be realized by
each of the parties from the cooperative exchange of technology.
Status Reviews. Each party shall designate an individual as a
representative to meet on no less than a semi-annual basis to (i) review the
status of ongoing projects, (ii) identify objectives for joint development
projects.
Specific Technology licensing and joint development efforts will be
documented and the exchange of information will be pursuant to a master
technology transfer and licensing agreement, the form of which shall be agreed
upon by the parties.
4. TECHNOLOGY TRANSFER:
The party obtaining Technology ("Recipient") shall be responsible for all
costs of implementation of the technology in its organization. The party
providing the technology ("Provider") shall grant such licenses that are
reasonably commercially appropriate.
Each project pursuant to which one party licenses technology to the other
party shall include, without limitation, specific terms with respect to (i)
Technology to be licensed, (ii) deliverables, (iii) tasks to be performed by
each party and, (iv) approximate schedule for completion of each task and the
transfer process, (v) estimated out-of-pocket expenses to be paid by the
receiving party.
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In the event that the Technology to be transferred or any part of the
Technology is third party software, the party providing such software shall be
under no obligation to make such Technology available to the receiving party
without obtaining the third party's permission for such transfer. The receiving
party shall be solely responsible for obtaining all necessary rights from such
third party and shall be solely responsible for all cost related thereto. The
providing party, upon request of the receiving party shall use its commercially
reasonable efforts to obtain said permission from the third party, but shall not
be required to incur any out of pocket expenses to do so. In the event that the
receiving party is unable to obtain the necessary rights from the third party,
the providing party will be under no further obligation with respect to such
Technology.
5. DEVELOPMENT:
In the event a party is planning a stand-alone information systems
development project estimated to cost more than $200,000.00 the planning party
will notify the other party. The parties will undertake to determine whether a
joint development activity would be beneficial to both parties. If a joint
development project is determined to be beneficial, the parties will enter good
faith negotiations leading to an agreement to proceed jointly with the project.
If the parties cannot reach an agreement to jointly develop the project, that
decision shall be documented with defined reasons for the decision and signed by
both parties.
Each development project to which the parties agree shall include, without
limitation, specific terms with respect to (i) description of the software to be
developed, (ii) the deliverables, (iii) the tasks to be performed by each party,
(iv) the projected time schedule for completing each task and project, (v)
resources each party will provide, and (vi) costs of which each party will be
responsible.
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6. SYNERGY BENEFITS:
The parties understand that the goal for both parties is to identify
Technology transfers that will synergistically benefit both parties. The synergy
benefits need not be equal for both parties. The parties shall determine such
synergy benefits as follows:
Technology Transfer Benefits. The primary benefit to the receiving party
from a Technology transfer shall be the difference between the fair market value
of the Technology transferred and the costs incurred by the receiving party. The
fair market value shall be the lesser of the cost of acquiring similar
technology from a third party and the cost of developing similar technology
internally. The secondary benefit to the receiving party shall be the reduction
in implementation costs and time resulting from the existence of an operational
technology and the use of existing training materials, cut-over strategies or
test systems. This secondary benefit shall be determined by evaluating the time
and implementation cost savings, if any, and the benefits associated with the
implementation of the Technology as are identified in the business justification
supporting such implementation.
Joint Development Benefits. In the event the parties mutually agree to
carry out joint development projects, the synergy benefit to either party shall
be the difference between that party's portion of the shared costs and the costs
which would have been incurred by that party had that party undertaken the
development on a stand-along basis.
Annual Benefits Determination. At the end of each calendar year, the
senior information technology executives of both parties or their designated
representatives, shall jointly quantify the synergy benefits to each party for
that year.
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7. CONFIDENTIAL INFORMATION:
The parties hereto understand that the Technology of each will be
considered confidential information proprietary to the party supplying the
information. All information deemed proprietary by the supplying party shall be
marked "Confidential and Proprietary" to place the receiving party on notice as
to the nature of the information. Any information provided by the supplying
party marked confidential and proprietary shall not be deemed confidential
information should that information (i) be lawfully in the public domain, (ii)
generally known and disclosed to the receiving party, lawfully by a third party,
(iii) be lawfully in the receiving party's possession prior to the receiving
party's receipt of the information pursuant to this agreement, or (iv)
independently developed by the receiving party and such independent development
is factually documented.
Confidentiality. Each party will safeguard the proprietary and
confidential materials supplied to it by the other party to the same degree and
extent that the party safeguards its own proprietary and confidential
information of the same or similar nature. Confidential and Proprietary
information received by a party shall not be disclosed to any third party
without the prior consent of the party providing the Confidential and
Proprietary information. The party receiving the Confidential and Proprietary
information will disseminate the information only to those employees who have
the need to know the contents of such information to discharge their employment
duties.
Non-Disclosure Agreements. Each party acknowledges that Confidential and
Proprietary information will be exchanged pursuant to Technology transfer
projects between the parties. The transfer of confidential information on each
project shall be pursuant to a Confidentiality and Non-Disclosure Agreement, the
terms of which shall be agreed upon by the parties.
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Ownership. All Confidential and Proprietary information of a party shall
remain the property of owning or developing party.
8. TERM AND TERMINATION
Term. Unless the parties agree to an earlier commencement date, the term
of this MOU shall commence as soon as practicable after the date that is the
later of the date that this MOU is signed by both parties or the date that the
investment agreement between America West and AmWest Partners, L.P. (the
"Investment Agreement") is consummated and shall continue until the date
immediately preceding the fifth anniversary of the commencement date, unless
earlier terminated as provided herein, and shall continue thereafter until
either party gives the other party notice of termination at least ninety (90)
days prior to the effective date of such termination. In no event shall
termination or expiration pursuant to this paragraph be effective unless such
ninety (90) days' notice is provided.
Termination. In addition to any other provisions of this MOU, this MOU may
be terminated, without liability, as follows:
(i) By either party on thirty (30) days' prior written notice, if the
other party has breached any material provision of this MOU unless
such other party cures such breach within such thirty (30) day
period;
(ii) By either party immediately on notice, if the other party shall be
dissolved or shall fail to maintain its corporate existence in
good standing, or shall have its authority to operate as a
scheduled airline suspended or revoked, or shall cease operations
as a scheduled airline;
(iii) By either party immediately on notice, in the event that the
commencement date of this MOU is prior to the date that the
Investment Agreement is consummated, if the Investment Agreement
is terminated prior to its having been consummated;
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88
(iv) Except for America West's currently pending Chapter 11 proceeding,
by either party if a petition is filed by or against the other
party under bankruptcy law, or any other law providing for the
relief of debtors, and the affected party does not succeed in
having such petition lifted or stayed within sixty (60) days from
the date of entry; the party at its option may cancel this MOU
immediately and exercise such other remedies as may be available at
law and/or in equity;
(v) By either party on six (6) months' prior written notice, if an air
carrier, foreign or domestic, that competes with the terminating
party on a material basis, acquires majority ownership of or
substantial control over the other party;
(vi) By either party on thirty (30) days' prior written notice, if the
Code Sharing Agreement between the parties hereto, dated June 29,
1994, is terminated prior to its expiration date.
9. INDEPENDENT PARTIES
Independent Contractors. It is expressly recognized and agreed that each
party, in its performance and otherwise under this MOU, is and shall be engaged
and acting as an independent contractor and in its own independent and separate
business; that each party shall retain complete and exclusive control over its
staff and operations and the conduct of its business; and that each party shall
bear and pay all expenses, costs, risks and responsibilities incurred by it in
connection with its obligations under this MOU. Neither Continental nor America
West nor any officer, employee, representative, or agent of Continental or
America West shall in any manner, directly or indirectly, expressly or by
implication, be deemed to be, or make any representation or take any action
which may give rise to the existence of any employment, agent, partnership, of
other like relationship as between Continental and America West but each party's
relationship as respects the other party in connection with this MOU is and
shall remain that of an independent contractor.
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89
Status of Employees. The employees, agents and/or independent contractors
of America West shall be employees, agents and independent contractors of
America West for all purposes, and under no circumstances shall be deemed to be
employees, agents or independent contractors of Continental. The employees,
agents and independent contractors of Continental shall be employees, agents and
independent contractors of Continental for all purposes, and under no
circumstances shall be deemed to be employees, agents or independent contractors
of America West. In its performance under this MOU, each party shall act as an
independent contractor and not as an agent for the other. Continental shall have
no supervisory power or control over any employees, agents or independent
contractors employed by America West, and America West shall have no supervisory
power or control over any employees, agents and independent contractors employed
by Continental.
Liability for Employee Costs. Each party, with respect to its own
employees (hired directly or through a third party), accepts full and exclusive
liability for the payment of worker's compensation and/or employer's liability
(including insurance premiums where required by law) and for the payment of all
taxes, contributions or other payments for unemployment compensation,
vacations, or old age benefits, pensions and all other benefits now or
hereafter imposed upon employers with respect to its employees by any
government or agency thereof or any other party (whether measured by the wages,
salaries, compensation or other remuneration paid to such employees or
otherwise) and each party further agrees to make such payments and to make and
file all reports and returns, and to do everything necessary to comply with the
laws imposing such taxes, contributions or other payments.
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10. ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS
This MOU constitutes the entire understanding of the parties with respect
to the subject matter hereof superseding all prior discussions and agreements,
written or oral. This MOU may not be amended, nor may any of its provisions
be waived, except by writing signed by both parties. No delay on the part of
either party in exercising any right power or privilege hereunder shall operate
as a waiver hereof, nor shall any waiver operate as a continuing waiver of any
right, power or privilege.
11. NOTICES
All notices given hereunder shall be in writing delivered by hand,
certified mail, telex, or telecopy to the parties at the following addresses:
If to CAL:
Continental Airlines, Inc. Telephone No. (713) 834-2950
2929 Allen Parkway Telecopier No. (713) 520-6329
Houston, Texas 77019
Attention: Vice Chairman & CEO
With copy to:
Continental Airlines, Inc. Telephone No. (713) 834-5149
2929 Allen Parkway Telecopier No. (713) 834-5161
Houston, Texas 77019
Attention: Senior Vice President and General Counsel
If to AWA:
America West Airlines, Inc. Telephone No. (602) 693-5880
4000 E. Sky Harbor Blvd. Telecopier No. (602) 693-5950
Phoenix, Arizona 85034
Attention: President & COO
With copy to:
America West Airlines, Inc. Telephone No. (602) 693-5750
4000 E. Sky Harbor Blvd. Telecopier No. (602) 693-5904
Phoenix, Arizona 85034
Attention: Vice President and General Counsel
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12. SUCCESSORS AND ASSIGNS
Neither party may assign its rights or delegate it duties under this MOU
without the prior written consent of the other party, and any such purported
assignment or delegation shall be void. This MOU shall be binding on the lawful
successors of each party.
13. SEVERABILITY
Any provision of this MOU which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction.
14. HEADINGS
The headings in this MOU are for convenience of reference only and shall
not define or limit any of the terms or provisions hereof.
15. COUNTERPARTS
This MOU may be executed in counterparts, all of which taken together shall
constitute one agreement.
16. GOVERNING LAW
This MOU shall be governed by and construed in accordance with the laws of
the State of New York without reference to principles of choice or conflicts of
law.
CONTINENTAL AIRLINES, INC. AMERICA WEST AIRLINES, INC.
By: By:
- - ------------------------------------------ ------------------------------------------
Title: Title:
- - ------------------------------------------ ------------------------------------------
Date: Date:
- - ------------------------------------------ ------------------------------------------
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