Document:

Exhibit 10.3 Q1 2015

EXHIBIT 10.3

EXECUTION COPY
AMENDMENT NO. 3
Dated as of September 9, 2014
to
CREDIT AGREEMENT
Dated as of June 18, 2012
THIS AMENDMENT NO. 3 (this “Amendment”) is made as of September 9, 2014 by and among Coach, Inc., a Maryland corporation (the “Company”), the financial institutions listed on the signature pages hereof and JPMorgan Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”), under that certain Credit Agreement dated as of June 18, 2012 by and among the Company, the Foreign Subsidiary Borrowers from time to time party thereto (together with the Company, the “Borrowers”), the Lenders and the Administrative Agent (as amended by Amendment No. 1 dated March 26, 2013, Amendment No. 2 dated November 27, 2013 and as further amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”).  Capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement.
WHEREAS, the Borrowers have requested that the requisite Lenders and the Administrative Agent agree to make certain amendments to the Credit Agreement;
WHEREAS, the Borrowers, the Lenders party hereto and the Administrative Agent have so agreed on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrowers, the Lenders party hereto and the Administrative Agent hereby agree to enter into this Amendment.
1.Amendments to the Credit Agreement.  Effective as of the Amendment No. 3 Effective Date (as defined below), the parties hereto agree that the Credit Agreement shall be amended as follows:
(a)    Each of HSBC Bank USA, National Association and Bank of America, N.A. is hereby designated as a Co-Syndication Agent and Merrill Lynch, Pierce, Fenner & Smith Incorporated is hereby designated as a Joint Bookrunner and a Joint Lead Arranger, in each case, in respect of the credit facility evidenced by the Credit Agreement as amended hereby.  Accordingly, (i) the cover page of the Credit Agreement is hereby amended to (x) refer to HSBC Bank USA, National Association and Bank of America, N.A. as Co-Syndication Agents and (y) add a reference to Merrill Lynch, Pierce, Fenner & Smith Incorporated as a Joint Bookrunner and as a Joint Lead Arranger and (ii) the introductory paragraph to the Credit Agreement is hereby amended to refer to HSBC Bank USA, National Association and Bank of America, N.A. as Co-Syndication Agents.
(b)    The definition of “Change in Law” appearing in Section 1.01 of the Credit Agreement is amended to delete the phrase “interpretation or application thereof by any Governmental 

Authority” appearing therein and replace such phrase with “interpretation, implementation or application thereof by any Governmental Authority”.
(c)    The definition of “Consolidated Net Worth” appearing in Section 1.01 of the Credit Agreement is amended to delete the phrase “the Statement of Financial Accounting Standards No. 142 (or the corresponding Accounting Standards Codification Topic, as applicable)” appearing therein and replace such phrase with “Accounting Standards Codification Topic 350”.
(d)    The definition of “LIBO Rate” appearing in Section 1.01 of the Credit Agreement is amended to delete the phrase “administered by the British Bankers Association” appearing therein and replace such phrase with “ICE Benchmark Association”.
(e)    The definition of “Maturity Date” appearing in Section 1.01 of the Credit Agreement is amended to delete the reference to “March 26, 2018” appearing therein and replace such reference with “September 9, 2019”.
(f)    The definition of “Reference Bank Rate” appearing in Section 1.01 of the Credit Agreement is amended to delete the phrase “London interbank market” appearing therein and replace such phrase with “London (or other applicable) interbank market”.
(g)    The definition of “Reference Banks” appearing in Section 1.01 of the Credit Agreement is amended to (i) delete the phrase “London offices” appearing therein and replace such phrase with “London (or other applicable) offices” and (ii) insert a new sentence at the end thereof as follows:
No Lender shall be obligated to be a Reference Bank without its consent.
(h)    The definition of “Statutory Reserve Rate” appearing in Section 1.01 of the Credit Agreement is amended to delete the phrase “, in the case of Dollar denominated Loans,” appearing therein.
(i)    Section 1.01 of the Credit Agreement is amended to (i) delete the definition of “Syndication Agent” appearing therein and (ii) add the following definitions thereto in the appropriate alphabetical order and, where applicable, replace the corresponding previously existing definitions:
“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Company or its Subsidiaries from time to time concerning or relating to bribery or corruption.
“Co-Syndication Agent” means each of HSBC Bank USA, National Association and Bank of America, N.A. in its capacity as co-syndication agent for the credit facility evidenced by this Agreement.
“Embargoed Country” means, at any time, a country or territory which is itself the subject or target of any comprehensive embargo under any Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Sudan and Syria).
“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, the United Nations Security Council, the European Union or any EU member state, or any Person owned or controlled by a Person listed on any such Sanctions-related list, or (b) any Person that is a national of, organized in  or resident in an Embargoed Country.

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“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.
“Total Assets” means, at any time, the total assets of the Company and its Subsidiaries, determined on a consolidated basis in accordance with GAAP.
(j)    Section 2.15(a) of the Credit Agreement is amended to restate clause (i) thereof in its entirety as follows:
(i)    impose, modify or deem applicable any reserve, special deposit, liquidity or similar requirement (including any compulsory loan requirement, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or any Issuing Bank;
(k)    Section 3.13 of the Credit Agreement is amended and restated in its entirety as follows:
SECTION 3.13.  Anti-Corruption Laws and Sanctions.  The Company has implemented and maintains in effect policies and procedures reasonably designed to ensure compliance in all material respects by the Company, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and the Company, its Subsidiaries and their respective officers and employees and to the knowledge of the Company its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.  None of (a) the Company, any Subsidiary or to the knowledge of the Company or such Subsidiary any of their respective directors, officers or employees, or (b) to the knowledge of the Company, any agent of the Company or any Subsidiary that will act in any capacity in connection with or benefit from the credit facilities established hereby, is a Sanctioned Person.
(l)    Section 5.07 of the Credit Agreement is amended to insert a new sentence at the end thereof as follows:
The Company will maintain in effect and enforce policies and procedures designed to ensure compliance in all material respects by the Company, its Subsidiaries and their respective directors, officers, employees and agents with  Anti-Corruption Laws and applicable Sanctions.
(m)    Section 5.08 of the Credit Agreement is amended to insert a new sentence at the end thereof as follows:
No Borrower will request any Borrowing or Letter of Credit, and no Borrower shall use, and the Company shall use reasonable best efforts to ensure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in 

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any Embargoed Country or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.
(n)    Section 6.01(s) of the Credit Agreement is amended and restated in its entirety as follows:
(s) Indebtedness incurred in connection with the acquisition of joint ventures in an aggregate amount not to exceed the greater of (i) $100,000,000 and (ii) 2.75% of Total Assets (determined at the time of each such incurrence by reference to the Company’s financial statements most recently delivered pursuant to Section 5.01(a) or (b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 5.01(a) or (b), the most recent financial statements referred to in Section 3.04(a)).
(o)    Section 6.04(k) of the Credit Agreement is amended and restated in its entirety as follows:
(k) Investments in joint ventures in an aggregate amount not to exceed the greater of (i) $100,000,000 and (ii) 2.75% of Total Assets (determined at the time of each such investment by reference to the Company’s financial statements most recently delivered pursuant to Section 5.01(a) or (b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 5.01(a) or (b), the most recent financial statements referred to in Section 3.04(a)); and
(p)    The penultimate paragraph of Article VIII of the Credit Agreement is amended to (i) to delete the phrase “Agreement as a Syndication Agent” appearing therein and replace such phrase with “Agreement as a Co-Syndication Agent” and (ii) to delete the phrase “capacities as Syndication Agent” appearing therein and replace such phrase with “capacities as Co-Syndication Agents”.
(q)    Section 9.09(b) of the Credit Agreement is amended to (i) to delete the phrase “to the nonexclusive jurisdiction” appearing therein and replace such phrase with “to the exclusive jurisdiction” and (ii) to delete the phrase “sitting in New York County and” appearing therein and replace such phrase with “sitting in New York County, Borough of Manhattan, and”.
(r)    Section 9.12 of the Credit Agreement is amended to add two new paragraphs at the end thereof as follows:
EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN THE IMMEDIATELY PRECEDING PARAGRAPH FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE COMPANY AND  ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.
ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE COMPANY OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY 

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CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE COMPANY, THE OTHER LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE COMPANY AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.
(s)    Schedule 2.01 to the Credit Agreement is amended and restated in its entirety in the form of Schedule 2.01 attached hereto.
2.    New Lenders.
(a)    Each of the undersigned financial institutions that is not a party to the Credit Agreement prior to the effective date of this Amendment (each, an “New Lender”) agrees to be bound by the provisions of the Credit Agreement and agrees that it shall, on the effective date of this Amendment, become a Lender for all purposes of the Credit Agreement, with a Commitment as set forth on Schedule 2.01 attached hereto.
(b)    Each undersigned New Lender (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Amendment and to consummate the transactions contemplated hereby and by the Credit Agreement and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to become a Lender, (iii) from and after the effective date of this Amendment, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and shall have the obligations of a Lender thereunder, and (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Amendment on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement and the other Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement and the other Loan Documents are required to be performed by it as a Lender.
3.    Conditions of Effectiveness.  The effectiveness of this Amendment (the “Amendment No. 3 Effective Date”) is subject to the satisfaction of the following conditions precedent:
(a)    The Administrative Agent shall have received counterparts of (i) this Amendment duly executed by the Borrowers, the Lenders, each New Lender, each Issuing Bank, the Swingline Lender and the Administrative Agent and (ii) the Consent and Reaffirmation attached hereto duly executed by the Subsidiary Guarantors.
(b)    The Administrative Agent shall have received favorable written opinions (addressed to the Administrative Agent and the Lenders and dated the Amendment No. 3 Effective Date) of (i) Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the Loan Parties, and (ii) Venable LLP, special Maryland counsel for the Loan Parties, each in form and substance reasonably satisfactory to the Administrative Agent and its counsel and covering such matters relating to the Loan Parties, the Loan Documents or the Transactions 

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as the Administrative Agent shall reasonably request.  The Company hereby requests such counsels to deliver such opinions.
(c)    The Administrative Agent shall have received, for the account of each Lender party hereto that delivers its executed signature page to this Amendment by no later than the date and time specified by the Administrative Agent, an upfront fee in an amount equal to the amount previously disclosed to the Lenders.
(d)    The Administrative Agent shall have received payment of the Administrative Agent’s and its affiliates’ fees and reasonable out-of-pocket expenses (including reasonable out-of-pocket fees and expenses of counsel for the Administrative Agent as set forth in the Amendment No. 3 Fee Letter dated as of August 11, 2014 among the Company, JPMorgan Chase Bank, N.A. and J.P. Morgan Securities LLC) in connection with this Amendment.
(e)    The Administrative Agent shall have made such reallocations of each Lender’s Applicable Percentage of the Revolving Credit Exposure under the Credit Agreement (including the New Lenders) as are necessary in order that the Revolving Credit Exposure with respect to such Lender reflects such Lender’s Applicable Percentage of the Revolving Credit Exposure under the Credit Agreement as amended hereby.  The Borrower hereby agrees to compensate each Lender for any and all losses, costs and expenses incurred by such Lender in connection with the sale and assignment of any Eurocurrency Loans and the reallocation described in this clause (e), in each case on the terms and in the manner set forth in Section 2.16 of the Credit Agreement.
4.    Representations and Warranties of the Company.  The Company hereby represents and warrants as follows:
(a)    This Amendment and the Credit Agreement as modified hereby constitute legal, valid and binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, liquidation, reconstruction, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought.
(b)    As of the date hereof and after giving effect to the terms of this Amendment, (i) no Default or Event of Default has occurred and is continuing and (ii) the representations and warranties of the Borrowers set forth in the Credit Agreement (other than, with respect to any Loan the proceeds of which are being used to refinance maturing commercial paper issued by the Company, Sections 3.04(b) and 3.06 of the Credit Agreement) are true and correct.
5.    Reference to and Effect on the Credit Agreement.
(a)    Upon the effectiveness hereof, each reference to the Credit Agreement in the Credit Agreement or any other Loan Document shall mean and be a reference to the Credit Agreement as amended hereby.
(b)    The Credit Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect and are hereby ratified and confirmed.

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(c)    Except with respect to the subject matter hereof, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith.
(d)    This Amendment shall be deemed to be a Loan Document.
6.    Governing Law.  This Amendment shall be construed in accordance with and governed by the law of the State of New York.
7.    Headings.  Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.
8.    Counterparts.  This Amendment may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Signatures delivered by facsimile or PDF shall have the same force and effect as manual signatures delivered in person.
[Signature Pages Follow]

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written.

COACH, INC.,
as a Borrower

By:____________________________________ 
Name:
Title:

Signature Page to Amendment No. 3 to
Credit Agreement dated as of June 18, 2012
Coach, Inc.

JPMORGAN CHASE BANK, N.A.,
individually as a Lender and as Administrative Agent

By:_______________________________________
Name:
Title:

Signature Page to Amendment No. 3 to
Credit Agreement dated as of June 18, 2012
Coach, Inc.

	
		
	Name of Lender:

	 

	 

	 

	 

	 

	By _________________________________

	 
	Name:

	 
	Title:

	 

	 

	 

	For any Lender requiring a second signature line:

	 

	 

	By _________________________________

	 
	Name:

	 
	Title:

Signature Page to Amendment No. 3 to
Credit Agreement dated as of June 18, 2012
Coach, Inc.

CONSENT AND REAFFIRMATION
Each of the undersigned hereby acknowledges receipt of a copy of the foregoing Amendment No. 3 (the “Amendment”) to the Credit Agreement dated as of June 28, 2012 (as amended by Amendment No. 1 dated March 26, 2013, Amendment No. 2 dated November 27, 2013 and as further amended, restated, supplemented or otherwise modified, the “Credit Agreement”) by and among Coach, Inc., the Foreign Subsidiary Borrowers from time to time party thereto, the financial institutions from time to time party thereto (the “Lenders”) and JPMorgan Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”), which Amendment No. 3 is dated as of September 9, 2014 (the “Consent and Amendment”).  Capitalized terms used in this Consent and Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement.   Without in any way establishing a course of dealing by the Administrative Agent or any Lender, each of the undersigned consents to the Amendment and reaffirms the terms and conditions of the Credit Agreement and any other Loan Document executed by it and acknowledges and agrees that such Credit Agreement and each and every such Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed.  All references to the Credit Agreement contained in the above‐referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment.
Dated:  September 9, 2014
[Signature Page Follows]

	
	
	COACH SERVICES, INC.

By: _________________________
Name: 
Title:

Signature Page to Consent and Reaffirmation to 
Amendment No. 1 to Credit Agreement dated as of June 28, 2012
Coach, Inc.

SCHEDULE 2.01
COMMITMENTS
	
				
	LENDER
	COMMITMENT

	JPMORGAN CHASE BANK, N.A.
	

	$100,000,000
	

	HSBC BANK USA, NATIONAL ASSOCIATION
	

	$100,000,000
	

	BANK OF AMERICA, N.A.
	

	$100,000,000
	

	TD BANK, N.A.
	

	$70,000,000
	

	U.S. BANK NATIONAL ASSOCIATION
	

	$70,000,000
	

	WELLS FARGO BANK, NATIONAL ASSOCIATION
	

	$70,000,000
	

	THE NORTHERN TRUST COMPANY
	

	$47,500,000
	

	PNC BANK, NATIONAL ASSOCIATION
	

	$47,500,000
	

	THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.
	

	$47,500,000
	

	BNP PARIBAS
	

	$47,500,000
	

	AGGREGATE COMMITMENT
	

	$700,000,000EX-4.1

 Exhibit 4.1 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND, EXCEPT IN SUCH
LIMITED CIRCUMSTANCES, MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR OF THE DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR. 
 Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation (“DTC”), to the Company or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. 

SOUTHWEST AIRLINES CO. 

2.750% Notes Due 2019 
  

			
	No. GS-1	 	CUSIP # 844741 BA5

 Southwest Airlines Co., a corporation duly organized and existing under the laws of Texas (herein called the
“Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of THREE HUNDRED MILLION DOLLARS
on November 6, 2019, and to pay interest thereon from November 6, 2014 or from the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, semi-annually in arrears on May 6 and November 6
(each, an “Interest Payment Date”) in each year, commencing May 6, 2015, at the rate of 2.750% per annum, until the principal hereof is fully paid or made available for full payment. Interest on this Security shall be computed on the basis
of a 360-day year of twelve 30-day months. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, subject to certain exceptions provided in such Indenture, be paid to the person in whose name this
Security is registered on the Security register or registers of the Company at the close of business on April 21 or October 22 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. 

 Payment of the principal of and interest on this Security will be made in such immediately
available funds of the United States of America as at the time of payment are legal tender for payment of public and private debts. 

Reference is hereby made to the further provisions of this Security set forth below, which further provisions shall for all purposes have the
same effect as if set forth in this place. 
 Unless the certificate of authentication hereon has been executed by the Trustee referred to
below by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal. 

Dated: November 6, 2014 
  

			
	SOUTHWEST AIRLINES CO.
		
	By:	 	 /s/ Tammy Romo

		 	Tammy Romo
		 	Senior Vice President Finance and
		 	Chief Financial Officer

 ATTEST: 
  

	
	 /s/ David Christopher Monroe

	David Christopher Monroe
	Vice President and Treasurer

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture. 

 

			
	WELLS FARGO BANK, NATIONAL ASSOCIATION
	as Trustee

			
		
	By:	 	 /s/ Patrick Giordano

		 	     Authorized Signatory

 This Security is one of a duly authorized issue of debt securities of the Company, issued and to
be issued in one or more series under an Indenture, dated as of September 17, 2004 (herein called the “Indenture”), between the Company and Wells Fargo Bank, National Association, as Trustee (herein called the
“Trustee”, which term includes any successor trustee under the Indenture), to which Indenture, all indentures supplemental thereto, and the Officers’ Certificate dated November 6, 2014, setting forth the terms of the debt
securities of this series, reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Company, the Trustee and the holders of the Securities (as defined below) and of the terms
upon which the Securities are, and are to be, authenticated and delivered. This Security is one of a series designated as 2.750% Notes Due 2019 (the “Securities”). This Security is a Global Security representing the entire principal
amount of Securities, initially limited in aggregate principal amount to $300,000,000, but subject to the right of the Company to issue and sell additional Securities in the future without the consent of the holders thereof. Any additional
securities of this series, together with this Security, shall constitute a single series under the Indenture. 
 Redemption 

The Securities shall be redeemable, at the option of the Company, in whole at any time or in part from time to time, on at least 30 days but
not more than 60 days’ prior notice mailed to the registered address of each holder of Securities to be so redeemed. If the Securities are redeemed at any time prior to October 6, 2019 (one month prior to the maturity date), the Securities
will be redeemed at a redemption price equal to the greater of (i) 100% of the principal amount of the Securities to be so redeemed plus accrued and unpaid interest thereon to the date of redemption and (ii) the sum of the present values
of the remaining scheduled payments of principal of the Securities to be so redeemed and interest thereon (exclusive of interest accrued to the redemption date) discounted to the date of redemption, on a semiannual basis (assuming a 360-day per year
consisting of twelve 30-day months), at the Treasury Rate (as defined herein) plus 20 basis points plus accrued and unpaid interest thereon to the date of redemption. If the Securities are redeemed on or after October 6, 2019 (one month prior
to the maturity date), the Securities will be redeemed at a redemption price equal to 100% of the principal amount of the Securities to be redeemed plus accrued and unpaid interest thereon to the redemption date. In either case, the redemption is
subject to the right of holders of record on the relevant record date to receive interest due on an Interest Payment Date that is on or before the date of redemption. 

If fewer than all of the Securities are to be redeemed at any time, selection of Securities for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities exchange, if any, on which the Securities are listed or, if the Securities are not listed on a national securities exchange, on a pro rata basis, by lot, or such other method as
the trustee deems appropriate and fair (or such other method as the DTC may require), provided, however, that the Securities will be redeemed only in the minimum denominations of $2,000 and integral multiples thereof of $1,000. 

For purposes of this paragraph, the following definitions shall apply: 

“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having an actual or
interpolated maturity comparable to the remaining term 

 
of the Securities to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of such Securities. 
 “Comparable Treasury Price” means, with respect to any redemption
date, the average of the Reference Treasury Dealer Quotations for such redemption date. 
 “Quotation Agent” means one of the
Reference Treasury Dealers appointed by the Company. 
 “Reference Treasury Dealer” means each of J.P. Morgan Securities LLC and
Morgan Stanley & Co. LLC and their respective successors; provided, however, that if either of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company
will substitute therefor another Primary Treasury Dealer. 
 “Reference Treasury Dealer Quotations” means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the
Company and the Trustee by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day preceding such redemption date. 

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity
or interpolated yield (on a day count basis) of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption
date. The Treasury Rate shall be calculated by the Quotation Agent on the third Business Day preceding such redemption date. 
 Change of Control

 Upon the occurrence of a Change of Control Triggering Event, unless the Company has otherwise exercised its right to redeem the
Securities, each holder of such Securities will have the right to require the Company to purchase all or a portion of such holder’s Securities pursuant to the offer described below (the “Change of Control Offer”), at a purchase price
equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of purchase, subject to the rights of holders of Securities on the relevant record date to receive interest due on the relevant Interest Payment
Date. 
 Within 30 days following the date upon which the Change of Control Triggering Event occurred, or at the Company’s option,
prior to any Change of Control but after the public announcement of the Change of Control, unless the Company has otherwise exercised the Company’s right to redeem the Securities, the Company shall deliver a notice to each holder of Securities,
with a copy to the Trustee, which notice will govern the terms of the Change of Control Offer. Such notice will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date such notice is
mailed, other than as may be required by law (the “Change of Control Payment Date”). The notice, if mailed prior to the 

 
date of consummation of the Change of Control, will state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring on or prior to the Change of Control
Payment Date. Holders of Securities electing to have Securities purchased pursuant to a Change of Control Offer must surrender their Securities, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Security
completed, to the Paying Agent at the address specified in the notice, or transfer their Securities to the Paying Agent by book-entry transfer pursuant to the applicable procedures of DTC, before the close of business on the third Business Day prior
to the Change of Control Payment Date. 
 The Company will not be required to make a Change of Control Offer if a third party makes such an
offer in the manner, at the times and otherwise in compliance with the requirements for such an offer made by the Company and such third party purchases all Securities properly tendered and not withdrawn under its offer. 

If holders of not less than 90% in aggregate principal amount of the outstanding Securities validly tender and do not withdraw the Securities
in a Change of Control Offer and the Company, or any third party making a Change of Control Offer in lieu of the Company, purchases all of the Securities validly tendered and not withdrawn by such holders, the Company will have the right, upon not
less than 30 nor more than 60 days’ prior notice, given not more than 30 days following such purchase pursuant to the Change of Control Offer described above, to redeem all Securities that remain outstanding following such purchase at a
redemption price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of redemption (subject to the right of holders of record on the relevant record date to receive interest on the relevant
Interest Payment Date). 
 The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934 (the “Exchange
Act”) and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Securities as a result of a Change of Control Triggering Event. To the extent
that the provisions of any such securities laws or regulations conflict with the change of control offer provisions of the Securities, the Company will comply with those securities laws and regulations and will not be deemed to have breached its
obligations under the change of control offer provisions of the Securities by virtue of any such conflict. 
 Except as described above with
respect to a Change of Control Triggering Event, the holders of the Securities shall not have any right to require the Company to repurchase or redeem the Securities in the event of a takeover, recapitalization or similar transaction. 

As used herein: 
 “Below
Investment Grade Rating Event” means the rating on the Securities is lowered by each of the Rating Agencies and the Securities are rated below Investment Grade by each of the Rating Agencies on any day within the 60-day period (which 60-day
period will be extended so long as the rating of the Securities is under publicly announced consideration for a possible downgrade by any of the Rating Agencies) after the earlier of (1) the occurrence of a Change of Control or (2) public
notice of the occurrence of a Change of Control or the Company’s intention to effect a Change of Control; provided that a Below Investment Grade Rating Event otherwise 

 
arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Below Investment Grade
Rating Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Company and the
Trustee in writing at its request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change
of Control shall have occurred at the time of the Below Investment Grade Rating Event). 
 “Change of Control” means the
consummation of any transaction (including without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act), other than the Company or its
subsidiaries, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the combined voting power of the Company’s Voting Stock or other Voting Stock into which the
Company’s Voting Stock is reclassified, consolidated, exchanged or changed measured by voting power rather than number of shares, other than any such transaction where: 

(a) the Company’s outstanding Voting Stock is reclassified, consolidated, exchanged or changed for other Voting Stock of
the Company or for Voting Stock of the surviving corporation, and 
 (b) the holders of the Company’s Voting Stock
immediately before that transaction own, directly or indirectly, not less than a majority of the Company’s Voting Stock or the Voting Stock of the surviving parent corporation immediately after such transaction and in substantially the same
proportion as their ownership in the Company before the transaction. 
 “Change of Control Triggering Event” means the occurrence
of both a Change of Control and a Below Investment Grade Rating Event. 
 “Fitch” means Fitch, Inc., also known as Fitch Ratings,
and its successors. 
 “Investment Grade” means a rating of BBB- or better by Fitch (or its equivalent under any successor rating
category of Fitch); a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating category of Moody’s); and a rating of BBB- or better by S&P (or its equivalent under any successor rating category of S&P).

 “Moody’s” means Moody’s Investors Service, Inc., a subsidiary of Moody’s Corporation, and its successors. 

“Rating Agency” means (1) each of Fitch, Moody’s and S&P, and (2) if any of Fitch, Moody’s or S&P ceases
to rate the Securities or fails to make a rating of such Securities publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” as defined in Section 3(a)(62) of the
Exchange Act, selected by the Company (as certified by a resolution of the Company’s board of directors) as a replacement agency for Fitch, Moody’s or S&P, or all of them, as the case may be. 

 “S&P” means Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc., and its successors. 
 “Voting Stock” of any specified person as of any date means the capital stock
of such person that is at the time entitled to vote generally in the election of the board of directors of such person. 
 Supplemental Indentures

 The Indenture contains provisions permitting the Company and the Trustee, with the consent of the holders of not less than a
majority in aggregate principal amount of the Securities at the time outstanding of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in
any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the holders of the Securities of each such series; provided, however, that no such supplemental indenture
shall (i) extend the stated maturity of any Security, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of any interest thereon, or reduce any amount payable on redemption thereof or impair or affect the
right of any holder of Securities to institute suit for payment thereof or right of repayment, if any, at the option of a holder of the Securities, without the consent of the holder of each Security so affected, or (ii) reduce the percentage of
aggregate principal amount of Securities of any series or of all series (voting as one class), as the case may be, the holders of which are required to consent to any such supplemental indenture, without the consent of the holders of all outstanding
Securities of each such series so affected. 
 Exchange 

This Global Security shall be exchangeable for Securities registered in the names of persons other than the Depositary for such Global Security
or its nominee only as provided in this paragraph. This Global Security shall be so exchangeable if (x) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for this Global Security or if at any time such
Depositary ceases to be a clearing agency registered as such under the Exchange Act, and the Company fails to appoint a successor Depositary for this Global Security within 90 days after the Company receives such notice or becomes aware of such
event, (y) the Company executes and delivers to the Trustee written instructions that this Global Security shall be so exchangeable or (z) there shall have occurred and be continuing an Event of Default or an event which, with the giving
of notice or lapse of time, or both, would constitute an Event of Default with respect to the Securities. Securities so issued in exchange for this Global Security shall be of the same series and of like tenor, in authorized denominations and in the
aggregate having the same principal amount as this Global Security and registered in such names as the Depositary for such Global Security shall direct. 

Transfer 
 As provided in the
Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security register or registers of the Company, upon surrender of this Security for registration of transfer at the office or agency
of the Company in 

 
any place where the principal of and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security registrar, duly executed by the registered holder hereof or its attorney duly authorized in writing, and thereupon on or more new Securities, and of like tenor, of authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees. At the date of the Indenture such agency of the Company is located at the office of Wells Fargo Bank, National Association, at 750 N. Saint Paul Place, Suite 1750, Dallas, Texas 75201. 

No service charge shall be made for any such exchange or registration of transfer, but the Company or the Securities registrar may require
payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 
 Prior to due presentment of
this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. All payments made to or upon the order of such registered holder shall, to the extent of the sum or sums paid, effectually satisfy and
discharge liability for moneys payable on this Security. 
 Miscellaneous 

The Securities are not subject to any sinking fund. 

The Indenture contains provisions for defeasance of the entire indebtedness of the Securities upon compliance by the Company with certain
conditions set forth therein. 
 If an Event of Default with respect to the Securities shall occur and be continuing, the principal of the
Securities may be declared due and payable in the manner and with the effect provided in the Indenture. 
 All terms used in this Security
that are defined in the Indenture shall have the meanings assigned to them in the Indenture. 
 The Indenture and the Securities shall be
governed by and construed in accordance with the laws of the State of Texas. 

 Option of Holder to Elect Purchase 

If you want to elect to have this Security purchased by the Company pursuant to the Change of Control Offer of the Indenture, check the box
below: 
  ̈ Yes 

If you want to elect to have only part of the Security purchased by the Company pursuant to Change of Control Offer of the Indenture, state
the amount you elect to have purchased (in minimum denominations of $2,000 and integral multiples thereof of $1,000, except if you have elected to have all of your Securities purchased):
$             
  

							
	Date:	 		 		 	 Your Signature:

		 		 		 	(Sign exactly as your name appears on the Security)
		 		 		 	 Tax Identification No.:

  

	
	Signature Guarantee*

  

	*	NOTICE: The Signature must be guaranteed by an institution which is a member of one of the following recognized signature Guarantee Programs: (i) The Securities Transfer Agent Medallion Program (STAMP);
(ii) The New York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) such other guarantee program acceptable to the Trustee.

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