Document:

EXHIBIT 10

EXHIBIT 10.2(e)

SUPPLEMENT TO TERMINAL E LEASE AND

SPECIAL FACILITIES LEASE AGREEMENT

(WITH RESPECT TO CENTRAL FIS CONCESSION AREA)

WHEREAS, the undersigned parties have heretofore entered into that certain Terminal E Lease and Special Facilities Lease Agreement (the "Agreement") dated as of August 1, 2001; and

WHEREAS, Section 3.03(d) permits the Director and an authorized officer of the Lessee to enter into a supplement or addendum to the Agreement in order to further define or delineate, delete from or add to any description of the Ground Lease Properties and the Easements; and

WHEREAS, in order to carry out the intents and purposes of Section 7.03(b) of the Agreement, the parties have determined to enter into this supplement (this "Supplement") to the Agreement in order to add to the description of certain Ground Lease Properties, specifically the description of the Lessee Central Ticketing Facility as more fully provided below; Now, Therefore,

IT IS HEREBY AGREED that the Agreement is hereby supplemented pursuant to Section 3.03(d) as follows:

Section 1.  Addition to Lessee Central Ticketing Facility.  Effective upon (i) the date of  substantial completion of construction of the shell and infrastructure of the premises described in Exhibit F to the Agreement (the "Central FIS Concession Area") by the City, such date to be mutually agreed upon between Lessee and the Director, and (ii) the satisfaction of the conditions set forth in Section 3 hereof, the Central FIS Concession Area shall be added to the Lessee Central Ticketing Facility, but solely for the limited purposes and subject to the conditions set forth below.  It is acknowledged, however, that it is not intended that Lessee will expend any proceeds from the Bonds in the Central FIS Concession Area and that, accordingly, such area shall not be considered to be Special Facilities under the Agreement. It is further agreed that the Central FIS Concession Area shall be considered public (concessions) space for purposes of establishing rates and charges at the Airport.  

Section 2.  Limitations.  The Central FIS Concession Area may be used by Lessee solely for, and the only authorized use of such area shall be for, the purpose of Lessee's exercising its rights and obligations contained in Section 7.03(b) of the Agreement, it being acknowledged that without the Director's prior written approval, Lessee shall not occupy any of such area or otherwise conduct operations therefrom, except that Lessee may sublease such area to any concessionaire or concessionaires in accordance with, and as contemplated by, Section 7.03(b) of the Agreement.  It is agreed that the City shall look solely to the respective concessionaire for the performance of all obligations in respect of any portion of the Central FIS Concession Area subleased to any such concessionaire and during the period of time such area is subleased to such concessionaire. Without limiting the generality of the foregoing sentence, Lessee shall have no construction obligations in the Central FIS Concession Area, it being acknowledged that such obligations will be performed by City as contemplated by Section 1 hereof and, to the extent requested or approved by the Director, by concessionaires or third party developers and/or managers (other than Lessee) as contemplated pursuant to Section 7.03(b) of the Agreement.  If after the commencement of the lease of the Central FIS Concession Area as herein provided, any portion of the Central FIS Concession Area is not occupied by a concessionaire, Continental's sole obligations in respect of such area shall be to use its reasonable efforts to procure new agreements as set forth in Section 3 hereof. The City acknowledges that, as contemplated by the Agreement, Continental intends to enter into an exclusive concession management contract (the "Management Contract") with a manager (the "Manager") conferring on Manager the right and duty to manage any concession sublease entered into covering any of the Central FIS Concession Area.    

Section 3.  Conditions.  It shall be a condition to the lease of the Central FIS Concession Area and Lessee's enjoyment of the rights herein granted and imposition of any obligations hereunder in respect of such area that Lessee shall cause the Manager to agree to pay all net revenues derived from concessions in the Central FIS Concession Area to the City as contemplated by and as provided in Section 7.03(b) of the Agreement and to agree that any concession sublease, together with the Management Contract as it pertains to the Central FIS Concession Area, shall be assignable by Lessee to the City upon the written request of the Director (and subject to agreement between the Director and the Manager as to the amount of fees and charges to be paid to the Manager in respect of such area) at the termination of Lessee's rights in and to the Central FIS Concession Area.  Insofar as the City will receive the net revenue from such concession space, the City shall be named a third party beneficiary of any such agreement to the extent it relates to the payment of net concession revenues to the City.  It is agreed that all rental amounts payable in respect of the Central FIS Concession Area shall be paid only from the net concession revenue derived from the Central FIS Concession Area as contemplated by and as provided in Section 7.03(b) of the Agreement, which net concession revenue shall be paid directly to the City pursuant to the agreements to be entered into as referenced in this Section 3.  By "net" revenues derived from such concessions, it is acknowledged that it is intended that the City will be paid all sums paid by the concessionaire under the applicable sublease for the right to occupy such concession space, after deduction of all fees and charges associated with the management of the concession space that are contracted to be retained by the Manager pursuant to the Management Contract.  Lessee agrees that the Management Contract shall not provide for the payment to Manager of fees and charges in respect of the Central FIS Concession Area that are unjustifiably in excess of the fees and charges payable to Manager in respect of similar concession facilities that are located in the South Concourse. It is further acknowledged that any such agreement (and to the extent appropriate, any sublease) will further contain the following provisions (or their substantial equivalent) and the City hereby agrees to the inclusion of such provisions: 

(a) From time to time, if it is necessary for the City to require the relocation, expansion or reduction of certain Central FIS Concession Areas for Airport operational (e.g., non-concession service) considerations, then the City shall use commercially reasonable efforts to provide Lessee on the terms herein provided with concession facilities that are reasonably comparable in terms of size and proximity to the Lessee Central Ticketing Facility's users' pedestrian traffic-flow patterns, substantially comparable to those that are being vacated.  

(b)The City may determine that it is necessary to relocate, expand, reduce, or discontinue all or a portion of the Central FIS Concession Area prior to the expiration or other termination of the Agreement if the City agrees to: (i) notify Lessee at least four (4) months in advance of the relocation, expansion, reduction or discontinuance of the concession facilities; (ii) in the event of the discontinuance, relocation and/or reduction, buy out the prorated, unamortized capital investment of Manager and the concession subtenant in and to such concession facility in accordance with the terms of the Management Contract.

(c)The City may require the reduction, relocation or discontinuance of any Concession Facilities within the Central FIS Concession Area, throughout the Term of this Agreement, if the City pays the reasonable and proper costs of putting the new substituted concession facilities in a condition ready for the fit-out by the concessionaire (e.g., in a shell condition) and for all reasonable and proper moving costs incurred in any relocation, such moving costs to include trade fixtures, furnishings, trade equipment and storefront signage. 

In the event of any material default by the concession subtenant or the Manager under any agreement referred to in this Section 3 in respect of the Central FIS Concession Area, Continental will, upon becoming aware of the default, inform the City thereof and will thereafter work cooperatively with the City in taking any action in respect of such default, but it is agreed that Continental shall not be liable to the City for any default by any concessionaire under any sublease or by Manager under the Management Contract.  

In the event of any termination of any such sublease agreement or the Management Contract, Lessee shall use reasonable efforts to cause new agreements (as contemplated by this Section 3) to be entered into for the sublease and management of the Central FIS Concession Area.  

Section 4.  Use of Defined Terms.  Capitalized terms used in this Supplement shall have the same meanings assigned to them in the Agreement.

EXECUTED as of the _______ day of ____________, 2002.

CITY OF HOUSTON, TEXAS

By_______________________

      Director of Aviation

CONTINENTAL AIRLINES, INC.

By_______________________

Title_________________EXHIBIT 10

EXHIBIT 10.22(ab)

Supplemental Agreement No. 27

to

Purchase Agreement No. 1951

between

The Boeing Company

and

Continental Airlines, Inc.

Relating to Boeing Model 737 Aircraft

 

 

THIS SUPPLEMENTAL AGREEMENT, entered into as of 

November 6, 2002, by and between THE BOEING COMPANY, a Delaware corporation with its principal office in Seattle, Washington, (Boeing) and Continental Airlines, Inc., a Delaware corporation with its principal office in Houston, Texas (Buyer);

WHEREAS, the parties hereto entered into Purchase Agreement No. 1951 dated July 23, 1996 (the Agreement), as amended and supplemented, relating to Boeing Model 737-500, 737-600, 737-700, 737-800, and 737-900 aircraft (the Aircraft); and

WHEREAS, Boeing and Buyer have agreed [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties agree to amend the Agreement as follows:

1.Table of Contents, Articles, Tables and Exhibits:

1.1Remove and replace, in its entirety, the "Table of Contents", with the Table of Contents attached hereto, to reflect the changes made by this Supplemental Agreement No. 27.

1.2Remove and replace, in its entirety, page T-3-3 and page T-3-4 of Table 1 entitled, "Aircraft Deliveries and Descriptions, Model 737-800 Aircraft", with revised page T-3-3 and page T-3-4 of Table 1, attached hereto, to reflect [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].

2.Letter Agreements:

2.1Remove and replace, in its entirety, Letter Agreement 1951-9R12, "Option Aircraft - Model 737-724 Aircraft", with the revised Letter Agreement 1951-9R13 attached hereto, to reflect [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].

 

The Agreement will be deemed to be supplemented to the extent herein provided as of the date hereof and as so supplemented will continue in full force and effect.

 

 

 

EXECUTED IN DUPLICATE as of the day and year first written above.

 

THE BOEING COMPANY  Continental Airlines, Inc.

 

 

 

By:   /S/ Michael S. Anderson By: /S/ Gerald Laderman 

Its:  Attorney-In-Fact  __Its: Senior Vice President -
      Finance and Treasurer 

 

TABLE OF CONTENTS

PageSA

NumberNumber

ARTICLES

1.Subject Matter of Sale1-1SA 5

2.Delivery, Title and Risk of Loss2-1

3.Price of Aircraft3-1SA 26

4.Taxes4-1

5.Payment5-1

6.Excusable Delay6-1

7.Changes to the Detail Specification7-1SA 5

8.Federal Aviation Requirements and Certificates and

and Export License8-1SA 5

9.Representatives, Inspection, Flights and Test Data9-1

10.Assignment, Resale or Lease10-1

11.Termination for Certain Events11-1

12.Product Assurance; Disclaimer and Release;

Exclusion of Liabilities; Customer Support;

Indemnification and Insurance12-1

13.Buyer Furnished Equipment and Spare Parts13-1

14.Contractual Notices and Requests14-1SA 17

15.Miscellaneous15-1

 

TABLE OF CONTENTS

PageSA

NumberNumber

TABLES

1.Aircraft Deliveries and Descriptions - 737-500T-1SA 3

Aircraft Deliveries and Descriptions - 737-700T-2SA 26

Aircraft Deliveries and Descriptions - 737-800T-3SA 27

Aircraft Deliveries and Descriptions - 737-600T-4SA 4

Aircraft Deliveries and Descriptions - 737-900T-5SA 26

 
EXHIBITS

A-1Aircraft Configuration - Model 727-723SA 26

A-2Aircraft Configuration - Model 737-824SA 26

A-3Aircraft Configuration - Model 737-624SA 1

A-4Aircraft Configuration - Model 737-524SA 3

A-5Aircraft Configuration - Model 737-924SA 26

BProduct Assurance DocumentSA 1

CCustomer Support Document - Code Two - 

Major Model DifferencesSA 1

C1Customer Support Document - Code Two -

Major Model DifferencesSA 1

DAircraft Price Adjustments - New 

Generation Aircraft (1995 Base Price)SA 1

D1Airframe and Engine Price Adjustments - Current 

Generation AircraftSA 1

 

D2Aircraft Price Adjustments - New 

Generation Aircraft (1997 Base Price)SA 5

EBuyer Furnished Equipment

Provisions DocumentSA 20

FDefined Terms DocumentSA 5

 

TABLE OF CONTENTS

SA

Number

LETTER AGREEMENTS

1951-1Not Used

1951-2R3Seller Purchased EquipmentSA 5

1951-3R17Option Aircraft-Model 737-824 AircraftSA 26

1951-4R1Waiver of Aircraft DemonstrationSA 1

1951-5R2Promotional Support - New Generation AircraftSA 5

1951-6Configuration Matters

1951-7R1Spares Initial ProvisioningSA 1

1951-8R2Escalation Sharing - New Generation AircraftSA 4

1951-9R13Option Aircraft-Model 737-724 AircraftSA 27

1951-11R1Escalation Sharing-Current Generation AircraftSA 4

1951-12R4Option Aircraft - Model 737-924 AircraftSA 26

1951-13Configuration Matters - Model 737-924     SA 5

1951-14Installation of Cabin Systems Equipment  SA 22

 

TABLE OF CONTENTS

SA

Number

RESTRICTED LETTER AGREEMENTS

6-1162-MMF-295Performance Guarantees - Model 737-724 Aircraft

6-1162-MMF-296Performance Guarantees - Model 737-824 Aircraft

6-1162-MMF-308R3Disclosure of Confidential InformationSA 5

6-1162-MMF-309R1[CONFIDENTIAL MATERIAL OMITTEDSA 1

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-MMF-311R4[CONFIDENTIAL MATERIAL OMITTEDSA 22

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-MMF-312R1Special Purchase Agreement ProvisionsSA 1

6-1162-MMF-319Special Provisions Relating to the Rescheduled Aircraft

6-1162-MMF-378R1Performance Guarantees - Model 737-524 AircraftSA 3

6-1162-GOC-015[CONFIDENTIAL MATERIAL OMITTEDSA 2

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-GOC-131R3Special MattersSA 22

6-1162-DMH-365Performance Guarantees - Model 737-924 AircraftSA 5

6-1162-DMH-624[CONFIDENTIAL MATERIAL OMITTEDSA 8

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-DMH-680Delivery Delay Resolution ProgramSA 9

6-1162-DMH-1020[CONFIDENTIAL MATERIAL OMITTEDSA 14

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-DMH-1035[CONFIDENTIAL MATERIAL OMITTEDSA 15

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-DMH-1054[CONFIDENTIAL MATERIAL OMITTEDSA 16

AND FILED SEPARATELY WITH THE SECURITIES

AND EXCHANGE COMMISSION PURSUANT TO

A REQUEST FOR CONFIDENTIAL TREATMENT]

6-1162-CHL-048Rescheduled Aircraft Agreement     SA 26

TABLE OF CONTENTS

 

SUPPLEMENTAL AGREEMENTSDATED AS OF:

Supplemental Agreement No. 1October 10,1996

Supplemental Agreement No. 2March 5, 1997

Supplemental Agreement No. 3July 17, 1997

Supplemental Agreement No. 4October 10,1997

Supplemental Agreement No. 5May 21,1998

Supplemental Agreement No. 6July 30,1998

Supplemental Agreement No. 7November 12,1998

Supplemental Agreement No. 8December 7,1998

Supplemental Agreement No. 9February 18,1999

Supplemental Agreement No. 10March 19, 1999

Supplemental Agreement No. 11May 14,1999

Supplemental Agreement No. 12July 2,1999

Supplemental Agreement No. 13October 13, 1999

Supplemental Agreement No. 14December 13,1999

Supplemental Agreement No. 15January 13,2000

Supplemental Agreement No. 16March 17,2000

Supplemental Agreement No. 17May 16, 2000

Supplemental Agreement No. 18September 11, 2000

Supplemental Agreement No. 19October 31,2000

Supplemental Agreement No. 20December 21, 2000

TABLE OF CONTENTS

 

 

SUPPLEMENTAL AGREEMENTSDATED AS OF:

Supplemental Agreement No. 19October 31,2000

Supplemental Agreement No. 21March 30, 2001

Supplemental Agreement No. 22May 23, 2001

Supplemental Agreement No. 23June 29, 2001

Supplemental Agreement No. 24August 31, 2002

Supplemental Agreement No. 25December 31, 2001

Supplemental Agreement No. 26March 29, 2002

Supplemental Agreement No. 27November 6, 2002

Table 1 to Purchase Agreement 1951

Aircraft Deliveries and Descriptions

Model 737-800 Aircraft

 

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

1951-9R13

November 6, 2002

 

Continental Airlines, Inc.

1600 Smith Street

Houston, Texas  77002

 
Subject:Letter Agreement No. 1951-9R13 to Purchase Agreement No. 1951 - Option Aircraft - Model 737-724 Aircraft

 

Ladies and Gentlemen:

This Letter Agreement amends Purchase Agreement No. 1951 dated July 23, 1996 (the Agreement) between The Boeing Company (Boeing) and Continental Airlines, Inc. (Buyer) relating to Model 737-724 aircraft (the Aircraft).  This Letter Agreement supersedes and replaces in its entirety Letter Agreement 1951-9R12 dated March 29, 2002.

All terms used and not defined herein shall have the same meaning as in the Agreement.

In consideration of Buyer's purchase of the Aircraft, Boeing hereby agrees to manufacture and sell up to [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] additional Model 737-724 Aircraft (the Option Aircraft) to Buyer, on the same terms and conditions set forth in the Agreement, except as otherwise described in Attachment A hereto, and subject to the terms and conditions set forth below.

1.Delivery.

The Option Aircraft will be delivered to Buyer during or before the months set forth in the following schedule:

Month and Year  Number of

 of Delivery  Option Aircraft

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

	Price.  

The basic price of the Option Aircraft shall be the [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

3.Option Aircraft Deposit.

In consideration of Boeing's grant to Buyer of options to purchase the Option Aircraft as set forth herein, Buyer has paid a deposit to Boeing of  [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]for each Option Aircraft (the Option Deposit) prior to the date of this Letter Agreement.  If Buyer exercises an option herein for an Option Aircraft, the amount of the Option Deposit for such Option Aircraft will be credited against the first advance payment due for such Option Aircraft pursuant to the advance payment schedule set forth in Article 5 of the Agreement.  

If Buyer does not exercise its option to purchase a particular Option Aircraft pursuant to the terms and conditions set forth herein, [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].

4.Option Exercise.

To exercise its option to purchase the Option Aircraft, Buyer shall give written notice thereof to Boeing on or before the first business day of the month in each Option Exercise Date shown below:

 

Option AircraftOption Exercise Date

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

5.Contract Terms.

Within thirty (30) days after Buyer exercises an option to purchase Option Aircraft pursuant to paragraph 4 above, Boeing and Buyer will use their best reasonable efforts to enter into a supplemental agreement amending the Agreement to add the applicable Option Aircraft to the Agreement as a firm Aircraft (the Option Aircraft Supplemental Agreement).

If the parties have not entered into such an Option Aircraft Supplemental Agreement within the time period contemplated herein, either party shall have the right, exercisable by written or telegraphic notice given to the other within ten (10) days after such period, to cancel the purchase of such Option Aircraft.

6.Cancellation of Option to Purchase.

Either Boeing or Buyer may cancel the option to purchase an Option Aircraft if any of the following events are not accomplished by the respective dates contemplated in this Letter Agreement, or in the Agreement, as the case may be:

(i)purchase of the Aircraft under the Agreement for any reason not attributable to the cancelling party;

(ii)payment by Buyer of the Option Deposit with respect to such Option Aircraft pursuant to paragraph 3 herein; or

(iii)exercise of the option to purchase such Option Aircraft pursuant to the terms hereof.

Any cancellation of an option to purchase by Boeing which is based on the termination of the purchase of an Aircraft under the Agreement shall be on a one-for-one basis, for each Aircraft so terminated.

Cancellation of an option to purchase provided by this letter agreement shall be caused by either party giving written notice to the other within ten (10) days after the respective date in question.  Upon receipt of such notice, all rights and obligations of the parties with respect to an Option Aircraft for which the option to purchase has been cancelled shall thereupon terminate.

If an option is cancelled as provided above, Boeing shall promptly refund to Buyer, without interest, any payments received from Buyer with respect to the affected Option Aircraft.  Boeing shall be entitled to retain the Option Deposit unless cancellation is attributable to Boeing's fault, in which case the Option Deposit shall also be returned to Buyer without interest.

7.Applicability.

Except as otherwise specifically provided, limited or excluded herein, all Option Aircraft that are added to the Agreement by an Option Aircraft Supplemental Agreement as firm Aircraft shall benefit from all the applicable terms, conditions and provisions of the Agreement.

 

If the foregoing accurately reflects your understanding of the matters treated herein, please so indicate by signature below.

Very truly yours,

THE BOEING COMPANY

 

 

 

By /S/ Michael S. Anderson

Its  Attorney-In-Fact     

 

ACCEPTED AND AGREED TO this

Date:   November 6, 2002

CONTINENTAL AIRLINES, INC.,

 

 

 

By  /S/ Gerald Laderman  

Its  Senior Vice President - Finance and Treasurer       

 

 

Attachment

Model 737-724 Aircraft

1.Option Aircraft Description and Changes.

1.1Aircraft Description.  The Option Aircraft are described by Boeing Detail Specification D6-38808-42 Revision A, dated as of November 1, 1998, as amended and revised pursuant to the Agreement.

1.2Changes.  The Option Aircraft Detail Specification shall be revised to include:

(1)Changes applicable to the basic Model 737-700 aircraft which are developed by Boeing between the date of the Detail Specification and the signing of a Supplemental Agreement for the Option Aircraft.

(2)Changes mutually agreed upon.

(3)Changes required to obtain a Standard Certificate of Airworthiness.

1.3Effect of Changes.Changes to the Detail Specification pursuant to the provisions of the clauses above shall include the effects of such changes upon Option Aircraft weight, balance, design and performance.

2.Price Description.

2.1Price Adjustments.

2.1.1Base Price Adjustments.  The Base Airplane Price (pursuant to Article 3 of the Agreement) of the Option Aircraft will be adjusted to Boeing's and the engine manufacturer's then-current prices as of the date of execution of the Supplemental Agreement for the Option Aircraft.

2.1.2Special Features.  The price for Special Features incorporated in the Option Aircraft Detail Specification will be adjusted to Boeing's then-current prices for such features as of the date of execution of the Supplemental Agreement for the Option Aircraft [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].

2.1.3Escalation Adjustments.  The Base Airframe and Special Features price will be escalated according to the applicable airframe and engine manufacturer escalation provisions contained in Exhibit D of the Agreement.

2.1.4Price Adjustments for Changes.  Boeing may adjust the Aircraft Basic Price and the Advance Payment Base Prices for Option Aircraft for any changes mutually agreed upon by Buyer and Boeing subsequent to the date that Buyer and Boeing enter into the Supplemental Agreement for the Option Aircraft.

2.1.5BFE to SPE.  An estimate of the total price for items of Buyer Furnished Equipment (BFE) changed to Seller Purchased Equipment (SPE) pursuant to the Detail Specification is included in the Option Aircraft price build-up.  The purchase price of the Option Aircraft will be adjusted by the price charged to Boeing for such items plus [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] of such price.

3.Advance Payments.

3.1If Buyer exercises its right under this letter agreement to acquire an Option Aircraft, Buyer shall pay to Boeing advance payments for such Option Aircraft pursuant to the schedule for payment of advance payments provided in the Agreement.

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