Document:

Exhibit
10.26

 

AMENDED AND RESTATED
MANUFACTURER BENEFITS AGREEMENT

 

THIS AMENDED AND RESTATED
MANUFACTURER BENEFITS AGREEMENT (this “Agreement”) is made and entered into as
of this       day of
                    ,
2003 by and between PINNACLE AIRLINES, INC., a Georgia corporation formerly
known as Express Airlines I, Inc. (“Pinnacle Airlines”), and NORTHWEST
AIRLINES, INC., a Minnesota corporation (“Northwest”);

 

WITNESSETH:

 

WHEREAS, Pinnacle
Airlines and Northwest entered into an Airline Services Agreement dated as of
January 14, 2003, as amended by that certain Amendment No. 1 dated as of
September 11, 2003 and by that certain Amendment No. 2 dated as of the
date hereof (such Airline Services Agreement, as amended or modified from time
to time, the “Airline Services Agreement”);

 

WHEREAS, in connection
with the performance by Pinnacle Airlines of its obligations under the Airline
Services Agreement, Northwest and Pinnacle Airlines entered into that certain
Manufacturer Benefits Agreement dated as of January 14, 2003 (the
“Original Manufacturer Benefits Agreement”) pursuant to which Northwest agreed
to make certain benefits under the Manufacturer Agreements (as hereinafter
defined) available to Pinnacle Airlines on the terms and conditions set forth
in the Original Manufacturer Benefits Agreement; and

 

WHEREAS, Northwest and
Pinnacle desire to amend and restate the Original Manufacturer Benefits
Agreement in its entirety.

 

NOW, THEREFORE, in
consideration of the premises and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Northwest and
Pinnacle Airlines do hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Terms for which meanings
are provided in the Airline Services Agreement are used in this Agreement with
such meanings.  In addition, for
purposes of this Agreement, the following terms shall have the meanings set
forth below:

 

Bombardier
means Bombardier Inc., a Canadian corporation.

 

GE
means General Electric Company, a New York corporation.

 

 

Manufacturer
Agreements means the 1999 Purchase Agreement, the 2001
Purchase Agreement, the 1999 GTA and the 2001 GTA.

 

Manufacturer
Benefits is defined in Section 2.01 hereof.

 

1999 GTA
means that certain General Terms Agreement (Contract No. CF34-0798-057), dated
as of February 19, 1999, between GE and Northwest, together with all
amendments and other modifications thereafter from time to time made thereto.

 

2

 

1999 Purchase
Agreement means that certain Purchase Agreement PA-0427,
dated February 12, 1999, between Bombardier and Northwest (including all
letter agreements executed in connection therewith), together with all
amendments and other modifications thereafter from time to time made thereto.

 

2001 GTA means that certain General
Terms Agreement (Contract No. CF34-0798-057-A), dated as of July 6, 2001,
between GE and Northwest, together with all amendments and other modifications
thereafter from time to time made thereto.

 

2001 Purchase Agreement
means that certain Purchase Agreement PA-0498, dated July 6, 2001, between
Bombardier and Northwest (including all letter agreements executed in
connection therewith), together with all amendments and other modifications
thereafter from time to time made thereto.  

 

ARTICLE II

 

MANUFACTURER
BENEFITS

 

Section 2.01.  Manufacturer Benefits.  In order to permit Pinnacle Airlines to
perform its obligations under the Airline Services Agreement, Northwest agrees
to make available to Pinnacle Airlines certain benefits provided to Northwest
under the Manufacturer Agreements and described below (the “Manufacturer
Benefits”):

 

(a)                                  Article 1.0
of Letter Agreement No. 08A to the 1999 Purchase Agreement and Article 1.0
of Letter Agreement No. 15 to the 2001 Purchase Agreement (in each case solely
to the extent applicable to the Aircraft);

 

(b)                                 all
aircraft warranty and service life policy benefits under (i) Annex B to
Schedule III to the 1999 Purchase Agreement as modified by Letter
Agreement No. 12 to the 1999 Purchase Agreement and (ii) Annex B to
Schedule III to the 2001 Purchase Agreement as modified by Letter
Agreement No. 11 and Letter Agreement No. 17 to the 2001 Letter Agreement (in
each case solely to the extent applicable to the Aircraft);

 

(c)                                  Letter
Agreement No. 6 to the 1999 Purchase Agreement and Letter Agreement No. 22 to
the 2001 Purchase Agreement (in each case solely to the extent applicable to
the Aircraft);

 

(d)                                 all
Bombardier vendor warranties and price caps (in each case solely to the extent
applicable to the Aircraft);

 

(e)                                  Letter
Agreement No. 10 and Letter Agreement No. 20 to the 2001 Purchase Agreement (in
each case solely to the extent applicable to the Aircraft);

 

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(f)                                    Letter
Agreement No. 8 and Letter Agreement No. 9 to the 2001 Purchase Agreement (in
each case solely to the extent applicable to the Aircraft);

 

(g)                                 Letter
Agreement No. 13 to the 1999 Purchase Agreement and Letter Agreement Nos. 18,
21 and 25 to the 2001 Purchase Agreement (in each case solely to the extent
applicable to the Aircraft);

 

(h)                                 such
proportion of the (i) technical documents, (ii) man-months of on-site
manufacturer representatives and (iii) training services made available to
Northwest under the Manufacturer Agreements as Northwest may from time to time
determine taking into account the experience level of Pinnacle Airlines as well
as the requirements of actual or potential additional operators of aircraft
purchased by Northwest under the 1999 Purchase Agreement and the 2001 Purchase
Agreement;

 

(i)                                     Articles
10.1 and 10.2 of Letter Agreement No. 8A to the 1999 Purchase Agreement and
Articles 4.1 and 4.2 of Letter Agreement No. 15 to the 2001 Purchase Agreement
(in each case solely to the extent of spare parts purchased by Pinnacle Airlines
which are subject to such Letter Agreements);

 

(j)                                     Article 10.4
of Letter Agreement No. 8A to the 1999 Purchase Agreement and Article 4.4
of Letter Agreement No. 15 to the 2001 Purchase Agreement (in each case solely
to the extent of insurance parts leased to Pinnacle Airlines pursuant to such
Letter Agreements);

 

(k)                                  such
number of initial provisioning shipments free of customs and shipping charges
pursuant to Article 3.0 of Letter Agreement No. 8A to the 1999 Purchase
Agreement and Article 2.0 of Letter Agreement No. 15 to the 2001 Purchase
Agreement as Northwest may determine in its sole discretion;

 

(l)                                     Article 2
of Annex A to Schedule III to the 1999 Purchase Agreement, as modified by
Articles 6.0, 7.0 and 8.0 of Letter Agreement No. 8A to the 1999 Purchase
Agreement and Article 2 of Annex A to Schedule III to the 2001
Purchase Agreement as modified by Articles 5.0, 6.0 and 7.0 of Letter Agreement
No. 15 to the 2001 Purchase Agreement (in each case solely to the extent
applicable to spare parts for the Aircraft purchased by Pinnacle Airlines
pursuant to such provisions);

 

(m)                               Letter
Agreement No. 16 to the 2001 Agreement (subject to Section 2.03);

 

(n)                                 Article 1.3
of Annex A to Schedule III to the 1999 Purchase Agreement and
Article 1.3 of Annex A to Schedule III to the 2001 Purchase
Agreement;

 

(o)                                 the
15% discount set forth in Paragraph III.B of Exhibit G to each of the 1999 GTA
and the 2001 GTA (in each case solely to the extent applicable to spare parts
purchased by Pinnacle Airlines for the Aircraft);

 

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(p)                                 Paragraph
III.C of Exhibit G to each of the 1999 GTA and the 2001 GTA (in each case
solely to the extent applicable to spare parts purchased by Pinnacle Airlines
for the Aircraft);

 

(q)                                 Paragraph
III.E of Exhibit G to each of the 1999 GTA and the 2001 GTA, provided that
Northwest may allocate the use of lease engines provided by GE pursuant to such
provisions among Pinnacle Airlines and one or more other operators of aircraft
purchased by Northwest pursuant to the 1999 Purchase Agreement and the 2001
Purchase Agreement in such manner as Northwest may determine in its sole
discretion;

 

(r)                                    Paragraphs
III.F, III.G, III.I and (subject to Section 2.03) III.J of Exhibit G to
the 1999 GTA and Paragraphs III.F, III.G, III.H (subject to Section 2.03)
and III.I of, and Attachment 2 to, the 2001 GTA (in each case solely to the
extent applicable to engines (or parts installed on engines) leased or
subleased by Northwest to Pinnacle Airlines for use in connection with the
Aircraft);

 

(s)                                  Paragraph
I of Exhibit E to each of the 1999 GTA and the 2001 GTA;

 

(t)                                    Exhibit
B to the 1999 GTA as modified by Paragraph III.D of Exhibit G to the 1999 GTA
and Exhibit B to the 2001 GTA as modified by Paragraph III.D of Exhibit G to
the 2001 GTA (in each case solely to the extent applicable to engines (or parts
installed on engines) leased or subleased by Northwest to Pinnacle Airlines for
use in connection with the Aircraft);

 

(u)                                 the
1.0% discount in Exhibit C to the 2001 GTA (subject to Section 2.03 and in
any event solely to the extent applicable to engines (or parts installed on
engines) leased or subleased by Northwest to Pinnacle Airlines for use in
connection with the Aircraft); and

 

(v)                                 Exhibit
D to each of the 1999 GTA and the 2001 GTA (in each case solely to the extent
applicable to engines leased or subleased by Northwest to Pinnacle Airlines for
use in connection with the Aircraft).

 

Section 2.02.  Pinnacle Airlines Co-operation.  Pinnacle Airlines agrees that it will (i)
except as otherwise agreed by Northwest, perform all record-keeping and data
gathering and maintenance functions required under the Manufacturer Agreements
in connection with the Manufacturer Benefits, (ii) perform all Aircraft
maintenance and other tasks required under the Manufacturer Agreements with
respect to the Manufacturer Benefits and (iii) subject to Aircraft scheduling
requirements imposed by Northwest, operate the Aircraft in a manner consistent
with the operating assumptions set forth in the Manufacturer Agreements with
respect to the Manufacturer Benefits, in each case so as to maximize the
availability and amount of the Manufacturer Benefits.

 

Section 2.03.  Northwest Allocation.  Notwithstanding anything to the contrary set
forth in Sections 2.01 and 2.02, in the event Northwest is entitled to receive
any cash payment

 

5

 

and/or credit against the
purchase of goods and services under the Manufacturer Agreements attributable
in whole or in part to any of the Manufacturer Benefits (excluding replacement
parts furnished under warranty), Northwest may (i) retain such cash payment
and/or credit for its own account, (ii) provide such cash payment and/or credit
to Pinnacle Airlines or (iii) allocate such cash payment and/or credit among
itself, Pinnacle Airlines and one or more other operators of aircraft purchased
by Northwest under the 1999 Purchase Agreement or the 2001 Purchase Agreement,
all in such manner as Northwest may from time to time determine in its sole
discretion.

 

ARTICLE III

 

TERM
AND TERMINATION

 

Section 3.01  Term.  The Original Manufacturer Benefits Agreement became effective as
of January 14, 2003 (the “Effective Date”) and is superceded by this
Agreement as of the date of this Agreement. 
This Agreement shall continue in effect until December 31, 2017 and
thereafter for so long as the Airline Services Agreement remains in effect,
subject to earlier termination in accordance with this Article III.

 

Section 3.02  Termination by Either Party upon Breach.  (a) In the event of a breach of a
nonmonetary provision of this Agreement by either party remaining uncured for
more than thirty (30) days after receipt of written notification of such
default by the nondefaulting party (or, in the case of a breach requiring more
than thirty (30) days notice to cure, in the event the defaulting party does
not begin and pursue with due diligence a method of cure within thirty (30)
days after receipt of written notification specifying in reasonable detail the
nature of such default from the nondefaulting party), then the nondefaulting
party may terminate this Agreement at its sole option.

 

(b)                                 In
the event of a breach of a monetary provision of this Agreement by either party
and such default remaining uncured for more than thirty (30) days after receipt
of written notification specifying in reasonable detail the nature of such
default from the nondefaulting party, then the nondefaulting party may
terminate this Agreement at its sole option.

 

Section 3.03  Termination by Northwest.  Notwithstanding the provisions of Section 3.02,
Northwest shall have the right to terminate this Agreement immediately and at
its sole option if:

 

(a)                                  a
Pinnacle Change of Control (as defined in the Airline Services Agreement) shall
occur; or

 

(b)                                 the
Airline Services Agreement is terminated.

 

6

 

ARTICLE IV

 

MISCELLANEOUS

 

Section 4.01  Limitation on Performance.  The obligation of either Northwest or
Pinnacle Airlines to perform under the terms of this Agreement shall be limited
or modified by, and neither party shall be deemed to be in default hereunder as
a result of any of the following causes:

 

(a)                                  acts
of God or the public enemy, civil war, insurrections or riots; fires, floods,
explosions, embargoes, earthquakes or serious accidents, epidemics, or
quarantine restrictions; any act of government, governmental priorities,
allocations, orders or Governmental Regulations affecting materials or
facilities, inability after due and timely diligence to procure materials,
accessories, equipment or parts; or any other cause to the extent it is beyond
that party’s practical control and not occasioned by that party’s fault or
negligence; or

 

(b)                                 cessation,
slow-down or interruption of work, or any other labor disturbance involving
Northwest.

 

Section 4.02  Mutual Cooperation.  Northwest and Pinnacle Airlines shall use
their reasonable best efforts to cooperate with each other in performing their
respective obligations under this Agreement.

 

Section 4.03  Representations and Warranties.  Except as expressly set forth herein,
neither Northwest nor Pinnacle Airlines shall make any representations or
warranties, expressed or implied, under or in connection with this Agreement.

 

Section 4.04  Assignment.  This Agreement may not be assigned by any party without the prior
written consent of the other parties.

 

Section 4.05  Governing Law.  This Agreement shall be governed in
accordance with the laws of the State of Minnesota, notwithstanding the choice
of law provisions thereof.

 

Section 4.06  Notices.  All notices given hereunder shall be given in writing and shall
be delivered in person or deposited in the United States mail, certified or
registered mail, return receipt requested, with adequate postage prepaid, or
given by express courier, telex, facsimile, or other expedient written means,
addressed as follows:

 

	
  If to Northwest:

  	
   

  	
  Northwest Airlines,
  Inc.

  
	
   

  	
   

  	
  Department A6100

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, Minnesota 55121

  
	
   

  	
   

  	
  Attn: Vice President -
  Market Planning

  
	
   

  	
   

  	
  Facsimile No: (612)
  727-7113

  

 

7

 

	
  With copies to:

  	
   

  	
  Northwest Airlines,
  Inc.

  
	
   

  	
   

  	
  Department A1180

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, Minnesota 55121

  
	
   

  	
   

  	
  Attn: General Counsel

  
	
   

  	
   

  	
  Facsimile No: (612)
  726-7123

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Northwest Airlines,
  Inc.

  
	
   

  	
   

  	
  Department A6030

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, MN 55121

  
	
   

  	
   

  	
  Attn: Director of
  Airlink Planning

  
	
   

  	
   

  	
  Facsimile No: (612)
  727-7110

  
	
   

  	
   

  	
   

  
	
  If to Pinnacle
  Airlines:

  	
   

  	
  Pinnacle Airlines, Inc.

  
	
   

  	
   

  	
  1689 Nonconnah Parkway

  
	
   

  	
   

  	
  Suite 111

  
	
   

  	
   

  	
  Attn:   Vice President and Chief

  Financial Officer

  
	
   

  	
   

  	
  Facsimile No: (901)
  348-4103

  

 

or to such other address as either party hereto shall
designate by notice in writing to the other party.  Notices shall be deemed received and given on the date of
delivery or the date of refusal of delivery as shown by the return receipt.

 

Section 4.07 
Parties.  Subject to
Section 4.04, this Agreement, and the rights and obligations created
hereunder, shall be binding upon and inure to the benefit of the respective
parties hereto and their respective successors and permitted assigns.

 

Section 4.08  Counterparts.  This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one agreement.

 

Section 4.09  Severability.  If any term of this Agreement shall be
judicially determined to be illegal, invalid or unenforceable at law or in
equity, it shall be deemed to be void and of no force and effect to the extent
necessary to bring such term within the provisions of any such applicable law
or laws, and such terms as so modified and the balance of the terms of this
Agreement shall remain enforceable.

 

Section 4.10  Captions and Section Headings.  Captions and section headings used herein
are for convenience only and are not a part of this Agreement and shall not be
used in construing it.

 

8

 

Section 4.11  Availability of Equitable Remedies;
Procedures.

 

(a)                                  In
the event of a breach by either party of any provision of this Agreement, the
nonbreaching party may give notice thereof to the breaching party, which notice
shall specify in reasonable detail the nature of the breach and shall demand
that the breaching party either cure the breach or refrain from conduct
constituting the breach (herein the “conduct”), as may be applicable.  If (i) the breaching party has not cured the
breach or refrained from the conduct, as may be applicable, within ten (10)
days following receipt of the notice from the nonbreaching party, or (ii) the
breaching party does not begin within ten (10) days following receipt of the
notice to pursue with reasonable diligence a method of cure or begin to take
steps toward ceasing the conduct where the breach or conduct is such that it
requires more than ten (10) days to cure or to cease, as may be applicable,
then the nonbreaching party may seek to compel performance by the breaching
party in accordance with the provisions of Section 4.11(b).  If, upon receiving a notice contemplated by
this paragraph (a), a breaching party believes that a breach has not occurred
or that the conduct specified in the notice does not constitute a breach of the
provisions of this Agreement, but the breaching party nonetheless cures the alleged
breach or refrains from the conduct within ten (10) days following receipt of
such notice, such party may thereafter proceed in accordance with the
provisions of Section 4.11(b) below to seek a determination of whether a
breach occurred or whether the specified conduct constituted a breach of the
provisions of this Agreement.

 

(b)                                 Because
a breach of the provisions of this Agreement could not adequately be
compensated by money damages, any party shall be entitled, following
notification in accordance with the provisions of Section 4.11(a), to an
injunction restraining such breach or threatened breach and to specific
performance of any provision of this Agreement and, in either case, no bond or
other security shall be required in connection therewith, and the parties
hereby consent to the issuance of such injunction and to the ordering of
specific performance.  Further, in the
event any party refrains from the conduct of any activity alleged in a notice
received pursuant to Section 4.11(a) above to constitute a breach of the
provisions of this Agreement, such party may thereafter proceed promptly to
bring an action in the District Court, County of Hennepin, State of Minnesota,
for an expedited judicial determination as to whether the conduct specified
constitutes a breach of the provisions of this Agreement and, upon a
determination that the conduct does not constitute a breach, such party may
promptly thereafter recommence such conduct.

 

Section 4.12  Integration and Entire Agreement.  This Agreement is intended by the parties as
a complete statement of the entire agreement and understanding of the parties
with respect to the subject matter hereof and all matters between the parties
related to the subject matter herein set forth.  This Agreement may only be amended or modified by a written
agreement between Pinnacle Airlines, on the one hand, and Northwest, on the
other, which specifically references this Agreement and expressly provides for
such amendment.

 

Section 4.13  Relationship of Parties.  Nothing in this Agreement shall be
interpreted or construed as establishing between the parties a partnership,
joint venture or other similar arrangement.

 

9

 

IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the date and year first above
written.

 

	
  PINNACLE AIRLINES, INC.

  	
  NORTHWEST AIRLINES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
  Name:

  
	
   

  	
  Title:

  	
   

  	
  Title:

  
								

 

10Exhibit 10.27

 

AMENDED AND RESTATED

PREFERENTIAL HIRING AGREEMENT

 

This Amended and Restated Preferential Hiring Agreement (the
“Agreement”) is made and entered into as of this
       day of
                  ,
2003 by and between Northwest Airlines, Inc., a Minnesota corporation with a
principal place of business at 5101 Northwest Drive, St. Paul, Minnesota  55111 (hereinafter referred to as
“Northwest”) and Pinnacle Airlines, Inc., a Georgia corporation with a principal
place of business at 1689 Nonconnah Blvd., Suite 111, Memphis, Tennessee  38132 (hereinafter referred to as
“Pinnacle”).

 

WHEREAS, Pinnacle and Northwest entered into
an Airline Services Agreement,

 

dated as of January 14, 2003, as amended by that certain Amendment
No. 1 dated as of September 11, 2003 and by that certain Amendment No. 2
dated as of the date hereof (such Airline Services Agreement, as amended or
modified from time to time, the “ASA”);

 

WHEREAS,
Pinnacle and Northwest entered into that certain Preferential Hiring Agreement
dated as of January 14, 2003 (the “Original Preferential Hiring
Agreement”), which provided for the terms and conditions under which laid off
Northwest pilots would be offered jobs as pilots by Pinnacle to staff the fleet
of regional jet Aircraft operated by Pinnacle; and

 

WHEREAS, Pinnacle and
Northwest desire to amend and restate the Original Preferential Hiring
Agreement in its entirety.

 

NOW,
THEREFORE, Northwest and Pinnacle hereby agree as follows:

 

1.                                       Definitions

 

“Aircraft” shall have the meaning ascribed to such term in
Section 1.01 of the ASA.

 

“Pinnacle Change of Control” shall have the meaning ascribed to such
term in Section 1.01 of the ASA.

 

2.                                       Pinnacle
Preferential Hiring.

 

A.                                   No laid off
Northwest pilot who is hired as a pilot by Pinnacle pursuant to this Agreement
will be required to resign from his employment at Northwest in order to be
eligible for employment as a pilot with Pinnacle.

 

B.                                     Pinnacle shall
hire as pilots, those laid off Northwest pilots who apply, subject to the
following conditions:

 

i.                                          The applicant
must submit a properly completed application to Pinnacle in compliance with
Pinnacle’s standard pilot hiring application process;

 

ii.                                       The applicant
must (a) submit to the standard interview process required of pilot applicants
at Pinnacle; (b) pass the standard Pinnacle background

 

1

 

check and medical evaluation for pilots; (c) possess the FAA medical
certificate and pilot licenses required for pilot employment at Pinnacle; and
(d) pass any standard objective tests required of pilot applicants at Pinnacle.

 

iii.                                    With respect to
laid off Northwest pilots whose applications are on file at any one time at
Pinnacle, and who meet the hiring requirements described in
Subsection 2.B.ii. above, Pinnacle shall make offers of employment as
pilots in seniority order as listed on the NWA/ALPA Integrated Pilots Seniority
List. Northwest shall supply to Pinnacle a list, in seniority order, of the
laid off Northwest pilots.

 

iv.                                   To the extent that
there are sufficient laid off Northwest pilots who have met the requirements of
Subsections 2.B.i. through 2.B.iii. above, beginning in January 2003, no
less than 75% of new hire positions in a new hire class at Pinnacle shall be
filled by such Northwest pilots, provided that Pinnacle shall not be required
to hire more than 15 laid off Northwest pilots per new hire class. For the
avoidance of doubt, no minimum hiring requirement is applicable with respect to
Pinnacle’s hiring of laid-off Northwest pilots prior to January 2003.

 

3.                                       Minimum Term of
Service. Laid off Northwest pilots who are hired as pilots by Pinnacle pursuant
to this Agreement may be required by Pinnacle to commit in writing to a Minimum
Term of Service at Pinnacle of 18 months. Such 18-month Minimum Term of Service
shall begin on the date of hire by Pinnacle and shall end after the completion
of the 18th flying month of employment with Pinnacle (e.g. pilot
date of hire is 1/5/03, 18 month minimum term of service ends at the end of the
June 2004 flying month). Laid off Northwest pilots who are hired as pilots
by Pinnacle pursuant to this Agreement shall not be subject to recall by
Northwest until after each such pilot has completed such Minimum Term of
Service.

 

4.                                       Maximum Monthly
Recall From Pinnacle. Pinnacle may limit the maximum number of laid off
Northwest pilots recalled to service with Northwest to 5 per month. Pinnacle
shall release such pilots who are eligible for recall by Northwest (i.e. pilots
who have completed their Minimum Term of Service as provided in Section 3
above) in seniority order as listed on the NWA/ALPA Integrated Pilots Seniority
List.

 

5.                                       If a laid off
Northwest pilot who has been hired as a pilot by Pinnacle pursuant to this
Agreement is on layoff status with Pinnacle at a time when he would otherwise
be recalled by Northwest, his Minimum Term of Service obligation to Pinnacle
shall be deemed satisfied, and he shall not be subject to the Maximum Monthly
Recall provisions of Section 4 above.

 

6.                                       Laid off
Northwest pilots who are hired as pilots by Pinnacle pursuant to this
Agreement, shall, for all purposes during their terms of service as Pinnacle
pilots, be governed exclusively by the pay, benefits, work rules, policies and
procedures governing pilots in

 

2

 

the service of Pinnacle, and shall not be covered by the collective
bargaining agreement between Northwest and the Air Line Pilots Association
covering pilots in the service of Northwest.

 

7.                                       Term
and Termination.

 

A.           Term.  The Original Preferential Hiring Agreement
became effective as of January 1, 2003 (the “Effective Date”) and is
superceded by this Agreement as of the date of this Agreement. This Agreement
continue in effect until December 31, 2017 and thereafter so long as the
ASA remains in effect, subject to earlier termination in accordance with this
Section 7.

 

B.             Termination by
Either Party upon an Event of Default. 
In the event of a breach of a nonmonetary provision of this Agreement by
either party remaining uncured for more than thirty (30) days after receipt of
written notification of such default by the nondefaulting party, or in the case
of a breach requiring more than thirty (30) days notice to cure, the defaulting
party does not begin and pursue with due diligence a method of cure within
thirty (30) days after receipt of written notification specifying in reasonable
detail the nature of such default from the nondefaulting party, then the
nondefaulting party may terminate this Agreement at its sole option.

 

C.                                     Termination by
Northwest.  Notwithstanding the
provisions of Section 7.A. or Section 7.B., Northwest shall have the
right to terminate this Agreement immediately and at its sole option if:

 

(a) a Pinnacle
Change of Control shall occur; or

 

(b) the ASA is
terminated.

 

8.                                       Miscellaneous

 

A.                                   Limitation on
Performance.  The obligation of
either Northwest or Pinnacle Airlines to perform under the terms of this
Agreement shall be limited or modified by, and neither carrier shall be deemed
to be in default hereunder as a result of any of the following causes:

 

(a) Acts of God or the public enemy, civil
war, insurrections or riots; fires, floods, explosions, embargoes, earthquakes
or serious accidents, epidemics, or quarantine restrictions; any act of government,
governmental priorities, allocations, orders or Governmental Regulations
affecting materials or facilities, inability after due and timely diligence to
procure materials, accessories, equipment or parts; or due to any other cause
to the extent it is beyond that carrier’s practical control or not occasioned
by that carrier’s fault or negligence.

 

(b) Cessation, slow-down or interruption of
work, or any other labor disturbance involving Northwest.

 

3

 

B.                                     Mutual
Cooperation.  Northwest and Pinnacle
Airlines shall use their reasonable best efforts to cooperate with each other
in performing their respective obligations under this Agreement.

 

C.                                     Representations
and Warranties.  Except as expressly
set forth herein, neither Northwest nor Pinnacle Airlines shall make any
representations or warranties, expressed or implied, under or in connection
with this Agreement.

 

D.                                    Assignment.  This Agreement may not be assigned by any
party without the prior written consent of the other parties.

 

E.                                      Governing Law.  This Agreement shall be governed in
accordance with the laws of the State of Minnesota, notwithstanding the choice
of law provisions thereof.

 

F.                                      Notices.  All notices given hereunder shall be given
in writing and shall be delivered in person or deposited in the United States
mail, certified or registered mail, return receipt requested, with adequate
postage prepaid, or given by express courier, telex, facsimile, or other
expedient written means, addressed as follows:

 

	
  If to Northwest:

  	
   

  	
  Northwest Airlines, Inc.

  
	
   

  	
   

  	
  Department A6100

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, Minnesota 55121

  
	
   

  	
   

  	
  Attn: Vice President - Market Planning

  
	
   

  	
   

  	
  Facsimile No: (612) 727-7113

  
	
   

  	
   

  	
   

  
	
  With copies to:

  	
   

  	
  Northwest Airlines, Inc.

  
	
   

  	
   

  	
  Department A1180

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, Minnesota 55121

  
	
   

  	
   

  	
  Attn: General Counsel

  
	
   

  	
   

  	
  Facsimile No: (612) 726-7123

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Northwest Airlines, Inc.

  
	
   

  	
   

  	
  Department A6030

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, MN 55121

  
	
   

  	
   

  	
  Attn: Director of Airlink Planning

  
	
   

  	
   

  	
  Facsimile No: (612) 727-7110

  

 

4

 

	
   

  	
   

  	
  Northwest Airlines, Inc.

  
	
   

  	
   

  	
  Department A1170

  
	
   

  	
   

  	
  2700 Lone Oak Parkway

  
	
   

  	
   

  	
  Eagan, MN  55121

  
	
   

  	
   

  	
  Attn:  Senior Vice President -
  Labor

  Relations

  
	
   

  	
   

  	
  Facsimile No:  (612) 726-3947

  
	
   

  	
   

  	
   

  
	
  If to Pinnacle Airlines:

  	
   

  	
  Pinnacle Airlines, Inc.

  
	
   

  	
   

  	
  1689 Nonconnah Parkway

  
	
   

  	
   

  	
  Suite 111

  
	
   

  	
   

  	
  Memphis, Tennessee 38132

  
	
   

  	
   

  	
  Attn: Vice President and Chief

  Financial Officer

  
	
   

  	
   

  	
  Facsimile No: (901) 348-4103

  

 

or to such other address as the respective parties hereto shall
designate by notice in writing to the other party.  Notices shall be deemed received and given on the date of
delivery or the date of refusal of delivery as shown by the return receipt.

 

G                                        Parties.  Except as provided to the contrary herein,
this Agreement, and the rights and obligations created hereunder, shall be
binding upon and inure to the benefit of the respective parties hereto and
their respective successors and permitted assigns.

 

H.                                    Counterparts.  This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one agreement.

 

I.                                         Severability.  If any term of this Agreement shall be
judicially determined to be illegal, invalid or unenforceable at law or in
equity, it shall be deemed to be void and of no force and effect to the extent
necessary to bring such term within the provisions of any such applicable law
or laws, and such terms as so modified and the balance of the terms of this
Agreement shall remain enforceable.

 

J.                                        Captions,
Section Headings and Table of Contents.  Captions, section headings and the Table of Contents used
herein are for convenience only and are not a part of this Agreement and shall
not be used in construing it.

 

K.                                    Availability
of Equitable Remedies; Procedures.

 

(a) In the event of a breach by either party
of any provision of this Agreement, the nonbreaching party may give notice
thereof to the breaching party, which notice shall specify in reasonable detail
the nature of the breach and shall demand that the breaching party either cure
the breach or refrain from conduct constituting the breach (herein the
“conduct”), as may be applicable.  If
(i) the breaching party has not cured the breach or refrained from the conduct,
as

 

5

 

may be applicable, within ten (10) days
following receipt of the notice from the nonbreaching party, or (ii) the
breaching party does not begin within ten (10) days following receipt of the
notice to pursue with reasonable diligence a method of cure or begin to take
steps toward ceasing the conduct where the breach or conduct is such that it
requires more than ten (10) days to cure or to cease, as may be applicable,
then the nonbreaching party may seek to compel performance by the breaching
party in accordance with the provisions of Subsection (b) below.  If, upon receiving a notice contemplated by
this Subsection (a), a breaching party believes that a breach has not
occurred or that the conduct specified in the notice does not constitute a
breach of the provisions of this Agreement, but the breaching party nonetheless
cures the alleged breach or refrains from the conduct within ten (10) days
following receipt of such notice, such party may thereafter proceed in
accordance with the provisions of Subsection (b) below to seek a
determination of whether a breach occurred or whether the specified conduct
constituted a breach of the provisions of this Agreement.

 

(b) Because a breach of the provisions of
this Agreement could not adequately be compensated by money damages, any party
shall be entitled, following notification in accordance with the provisions of
Subsection (a) above, to an injunction restraining such breach or
threatened breach and to specific performance of any provision of this
Agreement and, in either case, no bond or other security shall be required in
connection therewith, and the parties hereby consent to the issuance of such
injunction and to the ordering of specific performance.  Further, in the event any party refrains
from the conduct of any activity alleged in a notice received pursuant to
Subsection (a) above to constitute a breach of the provisions of this
Agreement, such party may thereafter proceed promptly to bring an action in the
District Court, County of Hennepin, State of Minnesota, for an expedited
judicial determination as to whether the conduct specified constitutes a breach
of the provisions of this Agreement and, upon a determination that the conduct
does not constitute a breach, such party may promptly thereafter recommence
such conduct.

 

L.                                      Integration
and Entire Agreement.  This
Agreement (including the Exhibits) and the ancillary documents entered into in
connection therewith are intended by the parties as a complete statement of the
entire agreement and understanding of the parties with respect to the subject
matter hereof and all matters between the parties related to the subject matter
herein and therein set forth.  This
Agreement may only be amended or modified by a written agreement between Pinnacle
Airlines, on the one hand, and Northwest, on the other, which specifically
references this Agreement and expressly provides for such amendment.

 

6

 

M.                                 Relationship of
Parties.  Nothing in this Agreement
shall be interpreted or construed as establishing between the parties a
partnership, joint venture or other similar arrangement.

 

7

 

IN WITNESS WHEREOF, Northwest and Pinnacle have caused this Agreement to
be duly signed as of the day and year first written above.

 

 

	
  PINNACLE AIRLINES,
  INC.

  	
   

  	
  NORTHWEST AIRLINES,
  INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  	
   

  	
  (Signature)

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  	
  Its:

  	
   

  	
   

  
										

 

 

8

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