Exhibit 10.9

 

Final

 

AMENDMENT NUMBER 6 TO PURCHASE AGREEMENT DCT-021/03

 

This Amendment Number 6 to Purchase Agreement DCT-021/03, dated as of January
24th, 2005 (“Amendment No. 6”) relates to the Purchase Agreement Number
DCT-021/03 between EMBRAER-Empresa Brasileira de Aeronáutica S.A. (“Embraer”)
and US Airways Group, Inc. (“Buyer”) dated May 9th, 2003 (as amended, the
“Purchase Agreement”). Buyer and Embraer are collectively referred to herein as
the “Parties”. Except as otherwise defined herein, all capitalized terms used
herein shall have the meanings set forth or referred to in the Purchase
Agreement, in the Letter Agreement DCT-022/03 dated as of May 9th, 2003 (as
amended, the “Letter Agreement”) or in the Financing Letter of Agreement
DCT-023/03 dated as of May 9th, 2003, each executed between Buyer and Embraer.

 

WITNESSETH

 

WHEREAS, Buyer and Embraer entered into the Purchase Agreement, pursuant to
which Embraer agreed to manufacture and sell to Buyer, and Buyer agreed to
purchase and take delivery from Embraer of, eighty-five (85) Firm Aircraft;

 

WHEREAS, Buyer and Embraer entered into the Letter Agreement pursuant to which,
among other things, the Parties agreed to additional terms and conditions
relating to the sale and purchase of Firm Aircraft;

 

WHEREAS, on September 12, 2004 (the “Petition Date”), Buyer filed a voluntary
petition for reorganization relief under chapter 11 of the United States
Bankruptcy Code (the “Bankruptcy Code”) in the United States Bankruptcy Court
for the Eastern District of Virginia, Alexandria Division (the “Court”) in the
matter entitled, In re US Airways, Inc., et al., Case No. 04-13819 (the
“Bankruptcy Proceedings”);

 

WHEREAS, prior to the Petition Date, Buyer and/or its airline subsidiaries had
taken delivery of twenty-two (22) of the eighty-five (85) Firm Aircraft,
pursuant to the terms and conditions of the Purchase Agreement and the Original
Financing LOA (as defined below);

 

WHEREAS, immediately following the Petition Date, the delivery of Firm Aircraft
pursuant to the Purchase Agreement and the Original Financing LOA (as defined
below) was suspended;

 

WHEREAS, Buyer and Embraer entered into that certain Post-Petition Purchase
Agreement – Modification and Aircraft Financing Term Sheet dated as of December
16, 2004 (the “Term Sheet”), which contemplates, among other things, (i) certain
modifications to the Purchase Agreement, the Letter Agreement and the Financing
Letter of Agreement DCT-023/03 executed between Buyer and Embraer, dated as of
May 9, 2003 (the “Original Financing LOA,” and together with the Purchase
Agreement and the Letter Agreement, the “Embraer Agreements”), and (ii) the
terms and conditions

 

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pursuant to which three (3) Embraer 170 Aircraft, i.e. Firm Aircraft #023, #024
and #025 (collectively, the “First Three Production Aircraft”), shall be
delivered to Buyer;

 

WHEREAS, on January 13, 2005, the Court entered an order (the Embraer Order”)
approving the transactions contemplated in the Term Sheet;

 

WHEREAS, simultaneously with the execution hereof, the Parties have entered into
that certain Amended and Restated Financing Letter of Agreement DCT-023/03 (the
“Financing LOA”), pursuant to which the parties have agreed to amend and restate
the terms of the Original Financing LOA to reflect the modifications
contemplated in the Term Sheet;

 

WHEREAS, other than delivery of the First Three Production Aircraft and three
(3) additional Aircraft, i.e., Firm Aircraft #026, #027 and #028 (collectively,
the “Final Three Production Aircraft”), all remaining Firm Aircraft shall be
delivered only upon Buyer’s assumption of each of the Embraer Agreements, to the
extent assumable, pursuant to Section 365 of the Bankruptcy Code, and in
accordance with a new delivery schedule to be agreed to by the parties as
contemplated in the Term Sheet, which schedule and terms shall be contained in
an amended and restated Purchase Agreement and a second amended and restated
Financing Letter of Agreement, each to be mutually agreed upon by Buyer and
Embraer; and

 

WHEREAS, in accordance with, and as contemplated by, the Term Sheet and the
Embraer Order, and in anticipation of future deliveries of Aircraft pursuant to
an amended and restated Purchase Agreement, the Parties wish to amend and modify
the Purchase Agreement and Letter Agreement as set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing, Embraer and Buyer do hereby
agree as follows:

 

1. APPLICATION OF DEPOSITS AND PROGRESS PAYMENTS

 

1.1 Buyer hereby agrees that Embraer shall create a reserve of $11,500,000 (the
“Reserve”) from the total amount of Initial Deposits and Progress Payments paid
to date by Buyer pursuant to Article 4.1 of the Purchase Agreement other than
those amounts paid in connection with the GECC Aircraft (as such term is defined
in the Financing LOA) (“PDPs”) and that the Reserve shall offset the loan
amounts due by Buyer to Embraer or its affiliates from October 2004 through and
including July 2005 (the “Loan Amounts”), as required by those certain loan
agreements concerning seven (7) EMBRAER 170 Aircraft which have been delivered
to Buyer prior to the date hereof and financed by affiliates of Embraer (“Loan
Agreements”). The Reserve shall be created upon execution of the agreements
between Buyer and Embraer pursuant to Section 1110(a)(2) of the United States
Bankruptcy Code concerning each of the Loan Agreements (“Section 1110
Agreements”). The Loan Amounts shall be calculated as provided for in each such
Loan Agreement. After offset from the Reserve of the

 

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Amendment No. 6 to Purchase

Agreement DCT-021/03

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loan amount due on July 15, 2005 (the “Reconciliation Date”) in connection with
the Aircraft bearing United States registration number N815MD, the Parties shall
reconcile the actual Loan Amounts due through the Reconciliation Date (taking
into account any fluctuations in the “Loan Rate” as described by each Loan
Agreement) against the Reserve. If any additional amount should be due to
Embraer as a result of such reconciliation, Embraer shall immediately deduct the
applicable amount from the GECC Aircraft PDPs (as defined below). If any portion
of the Reserve is not applied to the Loan Amounts after such reconciliation,
such portion shall be deemed nonrefundable and shall be applied to the progress
payment obligations of Buyer for the Final Three Production Aircraft and the new
delivery schedule to be negotiated pursuant to Section 2.3.

 

For the avoidance of doubt, the total amount of PDPs paid in connection with the
GECC Aircraft (the “GECC Aircraft PDPs”) and currently held by Embraer is USD
18,343,769 (eighteen million, three hundred and forty-three thousand, seven
hundred and sixty-nine United States dollars).

 

1.2 Buyer further agrees that upon execution of the Section 1110 Agreements, an
amount equal to USD 4,216,647 (four million, two hundred and sixteen thousand,
six hundred and forty-seven United States dollars) shall be immediately deducted
from the PDPs and applied by Embraer as liquidated damages payable to Embraer in
connection with suspension of the deliveries of six (6) EMBRAER 170 Aircraft
(the “Undelivered Aircraft”) originally scheduled to occur during the period
from the commencement of the Bankruptcy Proceedings through December 31, 2004
(the “Suspension Period”).

 

1.3 After application of the PDPs pursuant to Sections 1.1 and 1.2 above, the
balance of PDPs currently held by Embraer (other than the GECC Aircraft PDPs)
shall be directly applied as Buyer’s equity contribution towards the payment of
the Aircraft Purchase Price of the First Three Production Aircraft, and such
balance shall be divided by three (3) and each third shall be applied to the
Aircraft Purchase Price of each of the First Three Production Aircraft .

 

1.4 At such time as (w) Embraer has created the Reserve for the Loan Amounts
pursuant to Section 1.1 hereof; (x) Embraer has applied PDPs in the amount of
USD 4,216,647 (four million, two hundred and sixteen thousand, six hundred and
forty-seven United States dollars) on account of liquidated damages for
Undelivered Aircraft in accordance with Section 1.2 hereof; (y) Embraer has
applied PDPs in connection with the Buyer’s acquisition of, and equity
contribution to, the First Three Production Aircraft, as described by Section
1.3 hereof; and (z) Buyer has taken delivery of the First Three Production
Aircraft pursuant to Section 2.1 hereof, the GECC Aircraft PDPs shall be deemed
nonrefundable (subject to the application of such amounts in accordance with
Section 1.5 below) and free and clear of any liens of the ATSB Lender (as such
term is defined in the Court’s order dated October 15, 2004 in regard to cash
collateral, the “ATSB Order”) or any other entity claiming directly or
indirectly

 

Page 3 of 9

Amendment No. 6 to Purchase

Agreement DCT-021/03

--------------------------------------------------------------------------------

through Buyer, and Embraer may retain all such amounts on account of liquidated
damages pursuant to Section 20.3 of the Purchase Agreement to cover damages
which may be incurred by Embraer in the event that either (i) the Bankruptcy
Proceedings are converted to a chapter 7 proceeding or a substantial portion of
Buyer’s assets are otherwise liquidated, other than pursuant to a sale of
substantially all of Buyer’s assets as a going concern, or (ii) Buyer ultimately
rejects the Purchase Agreement.

 

1.5 In the event of an assumption of the Purchase Agreement and confirmation of
a plan of reorganization or a GECC commitment to reinstate financing for any
Aircraft, the parties shall negotiate a new delivery schedule as provided for in
Section 2.3 of this Amendment No. 6. Upon the agreement by the Parties
concerning such delivery schedule, the GECC Aircraft PDPs (so long as such
amounts are not retained by Embraer as partial liquidated damages pursuant to
Section 3.2 hereof) shall be applied to progress payment obligations for the new
delivery schedule accordingly. In such event, upon each delivery of any Aircraft
in which the relevant Aircraft Purchase Price is financed by GECC or by any
other third party, the relevant amount for such Aircraft (as determined in
accordance with Article 4 of the Purchase Agreement) shall be deducted from the
GECC Aircraft PDPs held by Embraer in connection with the GECC Aircraft and
returned to Buyer in accordance with Article 4.1.5 of the Purchase Agreement.

 

2. CHANGES IN THE AIRCRAFT DELIVERY SCHEDULES

 

2.1 The Parties hereby agree that, subject to the conditions precedent contained
in the Financing LOA, the First Three Production Aircraft shall be delivered in
the month of January 2005 and shall be financed pursuant to the terms and
conditions in the Financing LOA. The Final Three Production Aircraft are
scheduled to be delivered in the month of March 2005, and shall be delivered no
later than July 31, 2005.

 

2.2 After delivery of the First Three Production Aircraft and the conclusion of
production of the Final Three Production Aircraft, the production of all
remaining Firm Aircraft scheduled for delivery pursuant to Attachment E to the
Purchase Agreement (“Attachment E”) shall be suspended, and no further
obligation shall arise with respect hereto (except as otherwise contemplated
herein) and such remaining Firm Aircraft shall be remarketed and disposed of by
Embraer as permitted by applicable law. In the event the First Three Production
Aircraft or the Final Three Production Aircraft are not delivered as provided
for herein, such First Three Production Aircraft and/or Final Three Production
Aircraft shall be remarketed and disposed of by Embraer as permitted by
applicable law.

 

2.3 The parties hereby agree to negotiate a new delivery schedule for all
originally scheduled Firm Aircraft indicated on Attachment E which were not
delivered as of the commencement of the Bankruptcy Proceeding (other than the
First Three Production Aircraft and/or the Final Three Production Aircraft) in
the

 

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Amendment No. 6 to Purchase

Agreement DCT-021/03

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event of an assumption of the Purchase Agreement pursuant to Section 365 of the
United States Bankruptcy Code (the “Bankruptcy Code”), confirmation of a plan of
reorganization or a GECC commitment to reinstate financing. Any such assumption
of the Embraer Agreements shall include the new delivery schedule on an amended
Attachment E.

 

2.4 The delivery schedule of Reconfirmable Aircraft and Option Aircraft pursuant
to Attachment E is hereby deleted in its entirety. Embraer confirms that as of
the date of this Amendment No. 6 no delivery positions for Reconfirmable
Aircraft or Option Aircraft are being reserved for Buyer.

 

3. LIQUIDATED DAMAGES

 

3.1 Notwithstanding the application of PDPs on account of liquidated damages
pursuant to Section 1.2 hereof, additional liquidated damages may arise with
respect to the First Three Production Aircraft and the Final Three Production
Aircraft as follows: (i) if the First Three Production Aircraft are not
delivered by January 31, 2005 such First Three Production Aircraft shall be
terminated and damages shall be liquidated as provided for in Article 20.3 of
the Purchase Agreement, provided that the damages calculated pursuant to Article
20.3 shall be reduced by that portion of the amount of PDPs applied pursuant to
Section 1.2 hereof; (ii) if the Final Three Production Aircraft are not
delivered by March 31, 2005 then liquidated damages shall accrue from April 1,
2005 until the delivery of such Final Three Production Aircraft at a rate of USD
162,795 (one hundred sixty-two thousand, seven hundred and ninety-five United
States dollars) per month (or pro-rata portion thereof) per each of the Final
Three Production Aircraft until thirty (30) days after confirmation of a plan of
reorganization but in no event later than July 31, 2005.

 

3.2 If the Final Three Production Aircraft are not delivered by July 31, 2005,
such Final Three Production Aircraft shall be terminated and damages shall be
liquidated as provided for in Article 20.3 of the Purchase Agreement, provided
that the damages calculated pursuant to such Article 20.3 shall be reduced by
that portion of the amount of PDPs applied by Buyer pursuant to Section 1.2
hereof with respect to the Final Three Production Aircraft.

 

3.3 All such damages due upon a termination of the Purchase Agreement with
respect to any of the First Three Production Aircraft and the Final Three
Production Aircraft as described above may be deducted at Embraer’s discretion
from the PDPs and from the GECC Aircraft PDPs.

 

4. SPARE PARTS DEPOT

 

Notwithstanding the terms of that certain Buyer’s letter dated June 1, 2004
requesting Embraer to establish the Embraer 170 Family Spare Parts Depot on site
at the Philadelphia International Airport, Embraer shall not be obligated to

 

Page 5 of 9

Amendment No. 6 to Purchase

Agreement DCT-021/03

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establish such Spare Parts Depot at the Philadelphia International Airport or
any other location pursuant to Article 19 of the Letter Agreement until after
the effective date of Buyer’s plan of reorganization.

 

5. APPLICATION OF THE SPARE PARTS CREDIT

 

5.1 The balance of the spare parts credits issued by Embraer pursuant to Article
5 of Schedule C to the Letter Agreement (the “Spares Credit Provision”) and
available as of November 15, 2004, less the amount [REDACTED] (the “Remaining
Spare Parts Credits”), shall be applied to pre-petition amounts and
post-petition amounts specified in Sections 5.2 and 5.3 below and which were due
from Buyer and its affiliates for maintenance services provided by Embraer
Aircraft Customer Services, Inc (“EACS”) and Embraer Aircraft Maintenance
Services, Inc. (“EAMS”). In addition, all parts and equipment sold or
transferred to Buyer by Embraer, EACS, EAMS and their affiliates in connection
with maintenance services constitute Section 1110 Assets within the meaning of
the ATSB Order. The Remaining Spare Parts Credits shall be applied to the
outstanding balances due EAMS and EACS through November 15, 2004 and to all
taxes incurred by Embraer, EAMS, and EACS in application of such credits to such
balances. All payments due and owing by Buyer to EACS and EAMS after November
15, 2004 shall be deemed to be according to customary terms as provided for in
the Court’s order of September 15, 2004.

 

5.2 The Remaining Spare Parts Credits shall be applied in full satisfaction of
the outstanding balance owed by Buyer and its affiliates to EACS through
November 15, 2004 in the amount of [REDACTED] (“EACS Balance”), as indicated in
Exhibit “A” attached hereto, and has been calculated pursuant to the terms of
paragraph F of that certain Letter of Intent dated as of November 15, 2003
executed between Buyer and EACS and as amended from time to time. With respect
to amounts due and owing after November 15, 2004, Buyer and its affiliates shall
pay EACS on an ongoing basis in accordance with, that certain Letter of Intent
No. 2 dated as of November 16, 2004 executed between Buyer and EACS and as
amended from time to time. [REDACTED]

 

5.3 The Remaining Spare Parts Credit shall be applied in full satisfaction of
all outstanding balances owed by Buyer and its affiliates to EAMS through
November 15, 2004, plus the applicable Brazilian transfer taxes, which amount in
the aggregate equals [REDACTED] and are described in Exhibit “B” attached
hereto. With respect to amounts due and owing after November 15, 2004, Buyer and
its affiliates shall pay EAMS for all post-petition maintenance services within
30 days of invoice.

 

5.4 No further spare parts credits previously made available by Embraer pursuant
to the Spares Credit Provision shall be enforceable or valid unless the Purchase
Agreement is assumed as contemplated in Section 2.3 hereof. [REDACTED]

 

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Amendment No. 6 to Purchase

Agreement DCT-021/03

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6. CONDITIONS PRECEDENT

 

Embraer’s obligations under this Amendment No. 6 are contingent upon and subject
to Court approval, in a form satisfactory to Embraer, of the Motion for an Order
pursuant to 11 U.S.C. §§ 105(a), 362, 363, 364 and Section 1110 and Fed. R.
Bankr. P. 9019 Authorizing the Debtors to enter into a Global Settlement
including a Mortgage Loan facility with EMBRAER-Empresa Brasileira de
Aeronáutica S.A. dated January 3, 2005.

 

7. EFFECT UPON PURCHASE AGREEMENT

 

7.1 All terms and conditions of the Purchase Agreement and the Letter Agreement
that have not been specifically and expressly altered or modified hereunder
shall remain unmodified. In the event any conflict exists between the terms of
the Purchase Agreement or the Letter Agreement and the terms of this Amendment
No. 6, the terms of this Amendment No. 6 shall control.

 

7.2 The Parties hereby acknowledge and agree that Buyer’s execution of this
Amendment No. 6 does not constitute a post-petition contract or an assumption of
any of the Embraer Agreements, to the extent assumable, in the Bankruptcy
Proceedings under section 365 of the Bankruptcy Code or othewrwise, and Buyer
reserves all of its rights in this regard.

 

8. COUNTERPARTS

 

This Amendment No. 6 may be executed by the Parties in any number of
counterparts with the same effect as if the signatures thereto and hereto were
upon the same instrument and all of which when taken together shall constitute
one and the same instrument.

 

9. CONFIDENTIALITY

 

Notwithstanding anything to the contrary contained herein or in the Purchase
Agreement, including, without limitation, Article 24 thereof, the Parties hereby
agree that Buyer may disclose the terms and conditions of the Purchase Agreement
and this Amendment No. 6 to (i) the parties to that ATSB loan agreement, dated
as of March 31, 2003, as amended, and their respective professional advisors,
(iii) the professional advisors of the Official Committee of Unsecured Creditors
in the Bankruptcy Proceedings, and (iii) any prospective lender to and/or equity
investor in Buyer and their respective professional advisors; provided, however,
that such parties agree to hold the terms and conditions of the Agreement and
this Amendment No. 6 confidential.

 

[signature page follows]

 

Page 7 of 9

Amendment No. 6 to Purchase

Agreement DCT-021/03

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IN WITNESS WHEREOF, the Parties have caused this Amendment No. 6 to be duly
executed and delivered by their proper and duly authorized officers and to be
effective as of the day and year first above written.

 

US AIRWAYS GROUP, INC.       EMBRAER – EMPRESA BRASILEIRA DE AERONÁUTICA S.A.
By:           By:    

Name:

         

Name:

   

Title:

         

Title:

                By:                

Name:

               

Title:

   

Witness:           Witness:    

Name:

         

Name:

    Date:           Date:    

Place:

         

Place:

   

 

Page 8 of 9

Amendment No. 6 to Purchase

Agreement DCT-021/03

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Exhibit “A” to Amendment Number 6 to Purchase Agreement DCT-021/03

 

EACS – EMBRAER AIRCRAFT CUSTOMER SERVICES, INC.

Open Accounts Receivable for Invoices Through November 15, 2004

 

[REDACTED]

 

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Exhibit “B” to Amendment Number 6 to Purchase Agreement DCT-021/03

 

EAMS - Embraer Aircraft Maintenance Services, Inc.

Open Accounts Receivable for Invoices Through November 15, 2004

 

[REDACTED]