Document:

SAVE-EX10.1-2013.09.30-10Q

Exhibit 10.1

EXECUTION VERSION

AMENDED AND RESTATED

V2500® 

GENERAL TERMS OF SALE

BETWEEN

IAE INTERNATIONAL AERO ENGINES AG

AND

SPIRIT AIRLINES, INC.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

Exhibit 10.1

TABLE OF CONTENTS
1.    Definitions    5

2.    Installed and Spare Engine Purchase Commitments    6
2.1    Agreement to Purchase Aircraft from Airbus    6
2.2    Agreement to Purchase Spare Engines from IAE    6
2.3    Type Approval and Changes in Specification    6
2.4    Inspection and Acceptance    7
2.5    Delivery, Shipping, Title and Risk of Loss or Damage    8
2.6    Price    8
2.7    Payment    8

3.    Spare Parts Provisions    10
3.1    Intent and Term    10
3.2    ATA Standards    11
3.3    Stocking of Spare Parts    11
3.4    Lead Times    11
3.5    Ordering Procedure    12
3.6    Modifications to Spare Parts    12
3.7    Inspection    12
3.8    Delivery and Packing    13
3.9    Prices    13
3.10    Payment    14
3.11    Conflict    15

4.    Warranties, Guarantees and Liabilities    16

5.    Product Support Services    21

6.    Miscellaneous    21
6.1    Delay in Delivery    21
6.2    Patents    23
6.3    Credit Reimbursement and Right of Setoff    24
6.4    Non-Disclosure and Non-Use    24
6.5    Taxes    24
6.6    Amendment    25
6.7    Assignment    25
6.8    Exhibits    25
6.9    Headings    25
6.10    Governing Law and Forum    25
6.11    Compliance with All Applicable Laws and Regulations    25
6.12    Notices    26
6.13    Exclusion of Other Provisions and Previous Understandings    26
6.14    Conditions Precedent    27
6.15    Termination Events    27
6.16    Effect of Termination    29
6.17    No Construction Against Drafter    29

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

Exhibit A Contract Specifications    31
Exhibit A-1 V2524-A5 Turbofan Engine Model Specification    32
Exhibit A-2 V2527-A5 Turbofan Engine Model Specification    34
Exhibit A-3 V2533-A5 Turbofan Engine Model Specification    36

Exhibit B Schedules    38
Exhibit B-1 Aircraft Delivery Schedule    39
Exhibit B-2 Spare Engine Price and Delivery    40
Exhibit B-3 Escalation Formula    41

Exhibit C Product Support Plan    43

Exhibit D Warranties    64
*****

Exhibit E Guarantees    87
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

THIS CONTRACT is made this 1st day of October, 2013, (this “Contract”),  
BETWEEN
	
		
	IAE INTERNATIONAL AERO ENGINES AG
	a joint stock company organized and existing under the laws of Switzerland, with a place of business at 400 Main Street, M/S 121-10, East Hartford, Connecticut 06108, USA, (hereinafter called “IAE”) and

	SPIRIT AIRLINES, INC.
	a corporation organized and existing under the laws of Delaware, whose principal place of business is at 2800 Executive Way, Miramar, Florida 33025 (hereinafter called “Spirit”).

WHEREAS:
		
	A.
	As of the date hereof, (i) Spirit has acquired or has firmly ordered an aggregate of forty (40) new Airbus A320 family aircraft, all powered by, or to be powered by, V2500-A5 engines, (ii) Spirit has acquired or firmly ordered an aggregate of eleven (11) new V2500-A5 spare engines from IAE all of which are or will be operated by Spirit and (iii) Spirit has the option to purchase four (4) additional new V2500-A5 spare engines from IAE

		
	B.
	IAE and Spirit have entered into a V2500® General Terms of Sale dated March 1, 2005, as amended from time to time, including all side letters and amendments thereto, for the provision of V2500-A5 engines, modules, spare parts, tools,  equipment, and product support services for the support and operation of certain V2500-A5 engines (the “2005 GTA”);

		
	C.
	Spirit and IAE subsequently signed the V2500 Propulsion System and FHA Proposal dated October 27, 2006, as amended from time to time, including all side letters and amendments thereto, which outlines the financial support and support services for Spirit’s then-incremental order for A320 family aircraft powered by V2500-A5 engines and order for V2500-A5 spare engines (the “2006 Proposal”);

		
	D.
	IAE and Spirit have entered into a V-ServicesSM Fleet Hour Agreement dated October 1, 2013 for the provision of certain off-wing maintenance for the V2500-A5 engines operated by Spirit (the “Fleet Hour Agreement”);

		
	E.
	IAE and Spirit hereby agree to amend and restate the 2005 GTA in its entirety to incorporate the provisions contained in the 2006 Proposal; and

		
	F.
	IAE and Spirit now wish to agree upon terms whereby IAE will supply to Spirit V2500 engines, modules, spare parts, special tools, ground equipment, and product support services for the support and operation of the V2500 Engines.

NOW THEREFORE IT IS AGREED AS FOLLOWS:

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	1.
	Definitions

In this Contract unless the context otherwise requires:
		
	1.1
	“Aircraft” shall mean the forty (40) new Airbus A320 family aircraft powered by new Engines firmly ordered (including nineteen (19) A320 family aircraft already delivered as of the date of the Contract) and being acquired by Spirit from Airbus for delivery as set forth in Exhibit B-1 to this Contract.

		
	1.2
	“Airbus” shall mean Airbus SAS, with its principal place of business at 1, Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France, together with its successors and assigns.

		
	1.3
	“Certification Authority” shall mean the United States Federal Aviation Administration.

		
	1.4
	“Change Order” shall have the meaning set forth in Section 2.3.1 hereto.

		
	1.5
	“Engine(s)” shall mean the IAE V2500 aero engine described in the applicable Specification(s).

		
	1.6
	“Initial Provisioning” shall mean the establishment by Spirit of an initial stock of Spare Parts, Support Equipment, and Vendor Parts.

		
	1.7
	“Initial Provisioning Data” shall mean information supplied by IAE to Spirit for Initial Provisioning purposes.  

		
	1.8
	“Initial Provisioning Orders” shall mean orders for Spare Parts and Support Equipment for the purpose of Initial Provisioning.

		
	1.9
	“Lead Time” shall mean the period specified in the Spare Parts Catalog that represents the minimum time required between acceptance by IAE of an order by Spirit for Spare Parts and commencement of delivery of such Spare Parts.

		
	1.10
	“Service Bulletins” shall mean those service bulletins containing advice and instructions issued by IAE to Spirit from time to time in respect of Engines.

		
	1.11
	“Spare Engines” shall mean the Firm Spare Engines as defined in Section 2.2.1 and any additional new Spare Engines to be purchased in accordance with Section 2.2.2.

		
	1.12
	“Spare Parts” shall mean spare parts for Engines as identified in the Spare Parts Catalog, excluding the items listed in the Specification as being items of supply by Spirit.

		
	1.13
	“Spare Parts Catalog” shall mean the catalog published by IAE from time to time providing a description, Lead Time and price for Spare Parts available for purchase from IAE.  

		
	1.14
	“Specification(s)” shall mean the IAE Engine Specification(s) set forth in Exhibit A to this Contract, as the same may be amended, supplemented and/or updated from time to time.  

		
	1.15
	“Supplies” shall mean V2500 engines, Spare Parts, Vendor Parts, and Support Equipment.

		
	1.16
	“Support Equipment” shall mean tools, and all equipment (including handling, transportation and ground equipment) to be supplied pursuant to this Contract for use with the Aircraft and not for installation on the Aircraft.  Support Equipment does not constitute Spare Parts.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	1.17
	“Vendor Parts” shall mean parts not manufactured by IAE, including accessories, described as “Vendor Parts” in Initial Provisioning Data.  Vendor Parts do not constitute Spare Parts.

		
	2.
	Installed and Spare Engine Purchase Commitments

		
	2.1
	Agreement to Purchase Aircraft from Airbus  

Spirit agrees to purchase the Aircraft from Airbus powered by new Engines for delivery according to the schedule set forth in Exhibit B-1 to this Contract and agrees with IAE that Spirit will accept delivery of the Aircraft according to the schedule set forth in Exhibit B-1 to this Contract, as the same may be amended, supplemented and/or updated from time to time.
		
	2.2
	Agreement to Purchase Spare Engines from IAE  

		
	2.2.1
	Spirit hereby places a firm order with IAE for the purchase of eleven (11) new spare Engines (including eight (8) new spare Engines that have already been delivered as of the date of the Contract) (the “Firm Spare Engines”) for delivery according to the schedule set forth in Exhibit B-2 to this Contract, as the same may be amended, supplemented and/or updated from time to time.

		
	2.2.2
	Spirit, at its option, may also purchase and place up to four (4) additional new Spare Engines (the “Option Spare Engines”) on firm order with IAE, provided that Spirit gives written notice to IAE at least ***** prior to the delivery date for each such Option Spare Engine as set forth in Exhibit B-2, as the same may be amended, supplemented and/or updated from time to time. IAE and Spirit shall promptly amend this Contract to revise Exhibit B-2 to reflect the firm order of Option Spare Engines from IAE.

		
	2.2.3
	Except as otherwise set forth in the following paragraph, Spirit agrees to purchase an Engine storage bag and transportation stand from IAE for delivery with each Spare Engine.  The prices for such equipment are set forth in Exhibit B-2.

In the event that Spirit elects not to purchase a storage bag and transportation stand from IAE for delivery with any Spare Engine, those Spare Engines for which this equipment is to be provided as Spirit furnished equipment shall be identified as such in Exhibit B-2 and Spirit shall provide such equipment to IAE at least ***** prior to the scheduled delivery date of the applicable Spare Engine(s).  If for any reason Spirit has not delivered such equipment to IAE at least ***** prior to the scheduled delivery date of any applicable Spare Engine, then Spirit shall purchase such equipment from IAE at the prices set forth in Exhibit B-2.
		
	2.3
	Type Approval and Changes in Specification 

		
	2.3.1
	The Spare Engines will be manufactured to the standards set forth in the Specification.  After the date of this Contract, the Spare Engines may be varied from the standards set forth in the Specification and other IAE manufacturing specifications from time to time by written change orders  (each a “Change Order”), which shall set forth in detail:

		
	(a)
	The changes to be made in the Spare Engines; and

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	(b)
	The effect (if any) of such changes on the Specification (including but not limited to performance and weight), on interchangeability of the Spare Engines in the airframe, on prices and on dates of delivery of the Spare Engines.

Change Orders shall not be binding on either party until signed by IAE and Spirit but upon being so signed shall constitute amendments to this Contract.
		
	2.3.2
	IAE may make any changes in the Spare Engines that do not adversely affect the Specification (including but not limited to performance and weight), interchangeability of the Spare Engines in the airframe, prices or dates of delivery of the Spare Engines.  In the case of such permitted changes, a Change Order shall not be required or if issued shall not be binding until signed by IAE and Spirit. 

		
	2.3.3
	At the time of delivery of the Spare Engines there is to be in existence an FAA-issued “Type Approval Certificate” for the Spare Engines in accordance with the provisions of the Specification.

		
	2.3.4
	The Specification has been drawn with a view to the requirements of the Certification Authority and the official interpretations of such requirements in existence at the date of this Contract (such requirements and interpretations being hereinafter referred to as “Current Rules”).  Subject to Section 2.3.2 above, IAE and Spirit agree that they will execute an appropriate Change Order in respect of any change required to the Spare Engines to enable such Spare Engines to conform to the requirements of the Certification Authority and the official interpretations of such requirements in force at the date of delivery of such Spare Engines.

		
	2.3.5
	The price of any Change Order is to be paid by IAE in the case of changes required to conform to the Current Rules and by Spirit in any other case.

		
	2.4
	Inspection and Acceptance

		
	2.4.1
	IAE shall ensure that Spare Engines conform to the Specification through the maintenance of procedures, systems and records approved by the Certification Authority.  An FAA-issued “Authorized Release Certificate” (FAA Form 8130-3, Airworthiness Approval Tag) or “Certificate of Conformity” (as the case may be) will be issued and signed by personnel authorized for such purposes.

		
	2.4.2
	Upon delivery pursuant to Section 2.5.1 below and the issue of an “Authorized Release Certificate” (FAA Form 8130-3, Airworthiness Approval Tag) or a Certificate of Conformity pursuant to Section 2.4.1 above and IAE’s representation that the Engine storage bag and transportation stand, if purchased, conforms to the applicable purchase order, Spirit shall be deemed to have accepted the Spare Engines (and Engine storage bag and transportation stand, if purchased from IAE), and that the Spare Engines conform to the Specification.  Spirit’s acceptance will, however, in no way prejudice its valid warranties and support rights under this Contract or the Fleet Hour Agreement.  IAE shall, upon written request from Spirit and subject to the permission of the appropriate governmental authorities, arrange for Spirit to have reasonable access to the appropriate premises in order to examine the Spare Engines prior to the issue of conformance documentation and to witness Engine acceptance tests. 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	2.4.3
	If Spirit refuses, is unable to accept, or otherwise hinders delivery of any Spare Engine that satisfies the requirements set forth herein, Spirit shall nevertheless pay or cause IAE to be paid therefore as if, for the purposes of payment only, the Spare Engines had been delivered. 

		
	2.4.4
	In any of the cases specified in Section 2.4.3 above, Spirit shall also pay to IAE such reasonable sum as IAE shall require in respect of storage, maintenance and insurance of those Spare Engines.

		
	2.5
	Delivery, Shipping, Title and Risk of Loss or Damage

		
	2.5.1
	Provided Spirit has made payment in accordance with Section 2.7 below, IAE will deliver the Spare Engines (and Engine storage bag and transportation stand, if purchased from IAE), at its option, either Ex-Works (INCOTERMS 2000) Connecticut, United States of America or Ex-Works (INCOTERMS 2000) Dahlewitz, Germany, in accordance with the delivery schedule set out in Exhibit B-2 to this Contract.

		
	2.5.2
	Upon such delivery, title to and risk of loss of or damage to the Spare Engines (and Engine storage bag and transportation stand, if purchased from IAE) shall pass to Spirit.

		
	2.5.3
	Spirit will notify IAE at least thirty (30) days before the scheduled time for delivery of the Spare Engines of its instructions as to the marking and shipping of the Spare Engines.

		
	2.6
	Price

The purchase price for each of the Spare Engines shall be the unit base price set forth in Exhibit B-2 to this Contract, amended pursuant to Section 2.3 above, if applicable, and escalated in accordance with the escalation formula contained in Exhibit B-3 to this Contract.  The purchase price for the Engine storage bag and transportation stand, if purchased from IAE, shall be the current IAE price in effect at the time of Spare Engine delivery.
		
	2.7
	Payment

		
	2.7.1
	Spirit will make payment for Spare Engines (and Engine storage bag and transportation stand, if purchased from IAE) in United States Dollars as follows:

		
	(a)
	***** before the scheduled delivery of each of the Spare Engines, Spirit shall pay to IAE a non-refundable payment of ***** of the Estimated Purchase Price of such Spare Engine.

		
	(b)
	***** before the scheduled delivery of each of the Spare Engines, Spirit shall pay to IAE a non-refundable payment of ***** of the Estimated Purchase Price of such Spare Engine.

		
	(c)
	Immediately prior to the delivery of each of the Spare Engines, Spirit shall pay to IAE the balance of the escalated purchase price of such Spare Engine, plus the purchase price of the Engine storage bag and transportation stand, if purchased from IAE.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	2.7.2
	IAE shall have the right to require Spirit to make additional payments in respect of price changes arising from the provisions of Section 2.3 above on a similar basis to that specified in Section 2.7.1 above.

		
	2.7.3
	Spirit shall pay the full amount of payments falling due under this Section 2.7, without any withholding or deduction whatsoever.  

		
	2.7.4
	All payments under this Section 2.7 shall be made by wire transfer and shall be deposited not later than the due date of payment with:

*****

or such other account in the United States as notified from time to time by IAE.
		
	2.7.5
	For the purpose of this Section 2.7 “payment” shall only be deemed to have been made to the extent cleared or good value funds are received in the numbered IAE bank account specified in Section 2.7.4 above or as otherwise notified to Spirit in writing by IAE. 

		
	2.7.6
	If Spirit fails to make any payment pursuant to this Section 2 on or before the date when such payment is due, then, without prejudice to any of IAE's other rights, IAE will (a) be entitled to charge interest on the overdue amount, at the rate equal to the greater of ***** per annum or the New York Citibank prime rate plus ***** per annum, from the date such payment was due to the date such payment is made and (b) have the right (but not the obligation) to suspend work on the manufacture of Spare Engines pending the remedy of such failure and to reschedule the date of delivery of such Spare Engines following the cure of such failure.  Notwithstanding the foregoing, Spirit shall not be liable for interest in respect of any overdue amount which is being contested in good faith.  

		
	2.7.7
	For the purpose of this Section 2.7, the “Estimated Purchase Price” of any of the Spare Engines shall be calculated in accordance with the following formula:

*****
where:
*****.
		
	3.
	Spare Parts Provisions

		
	3.1
	Intent and Term

		
	3.1.1
	For as long as Spirit owns and operates one or more Aircraft in regular commercial service and is not in breach of any material obligation to IAE under this Contract, IAE shall use commercially reasonable efforts to make available adequate supplies of Spare Parts for sale to Spirit under this Contract.  In consideration thereof, except as otherwise provided under Section 3.1.2 below, Spirit shall buy from IAE, and IAE shall sell to Spirit, all of Spirit's requirements of the following:

		
	(a)
	Spare Parts and Support Equipment necessary to support Spirit’s operation of the Aircraft; and

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	(b)
	Vendor Parts for which direct supply arrangements between the manufacturers of such Vendor Parts and Spirit cannot be reasonably established.  Spirit shall notify IAE in writing not less than the greater of (i) the lead time of the vendor as specified in the respective vendor manual or (ii) three (3) months before scheduled delivery requested by Spirit that Spirit intends to purchase such Vendor Parts from IAE. 

In an emergency or upon the reasonable request of Spirit, IAE may sell to Spirit Vendor Parts which it is not obligated to sell under this Contract, but which it has in stock or otherwise has reasonably available to it in current inventory. 
		
	3.1.2
	Purchase by Spirit from Others     

***** 
		
	3.2
	ATA Standards

The parties to this Contract shall comply with the requirements of shipping procedures outlined in ATA Specifications 2000 and 300, provided that the parties shall be entitled to negotiate reasonable changes in those procedures or requirements of the specifications that, if complied with exactly, would result in an undue operating burden or unnecessary economic penalty.
		
	3.3
	Stocking of Spare Parts

As soon as reasonably possible after receipt of IAE’s request, Spirit shall provide IAE with information reasonably required to enable IAE to plan and organize the manufacture and stocking of Spare Parts.  
		
	3.4
	Lead Times

		
	3.4.1
	IAE shall endeavor to deliver replenishment Spare Parts within the Lead Time specified in the IAE Spare Parts Catalog, except for certain major Spare Parts that are designated in the Spare Parts Catalog as being available at prices and lead times to be quoted upon request.  Support Equipment and Vendor Parts are available at prices and lead times to be quoted upon request.  

		
	3.4.2
	If any order for replenishment Spare Parts shall call for a quantity materially in excess of Spirit's normal requirements, IAE shall notify Spirit and may request a special delivery schedule.  If Spirit confirms that the full quantity ordered is required, delivery of the order shall be effected at delivery dates mutually acceptable to IAE and Spirit and the Lead Times provided by this Section shall not apply. 

		
	3.4.3
	In an emergency, IAE shall use its reasonable efforts to deliver all Spare Parts within the time limits specified by Spirit.  IAE will provide notice of the action to be taken on such orders within the following time periods from IAE's receipt of such notice and based on the type of order:

		
	(a)
	AOG (Aircraft on Ground) orders - within 4 hours;

		
	(b)
	Critical (imminent AOG or work stoppage) - within 24 hours;

		
	(c)
	Expedited (less than published or quoted lead time) - within 7 days.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	3.5
	Ordering Procedure

		
	3.5.1
	Orders for Spare Parts and Support Equipment may be placed by Spirit from time to time on an as-needed basis.  Spirit shall give IAE as much notice as practicable of any change in its operation, including, but not limited to, changes in maintenance or overhaul arrangements affecting its requirements of Spare Parts, Support Equipment and including Vendor Parts.

		
	3.5.2
	IAE shall promptly acknowledge receipt of each order for Spare Parts in accordance with ATA Specification 2000 procedure.  Unless qualified, such acknowledgment, subject to variation in accordance with Section 3.4.2 above, shall constitute an acceptance of the order under the terms of this Contract.

		
	3.5.3
	Standard package quantities shall be delivered and packed in accordance with the Spare Parts Catalog.

3.6    Modifications to Spare Parts
		
	3.6.1
	IAE shall be entitled to make modifications or changes to the Spare Parts ordered by Spirit hereunder provided that the modification has received the approval of the Certification Authority and modified Spare Parts shall be substituted for Spare Parts ordered.  IAE shall promptly inform Spirit by means of Service Bulletins when such modified Spare Parts (or Spare Parts introduced by a repair scheme) become available for supply hereunder.  Notification of such availability shall be given to Spirit before delivery.  

		
	3.6.2
	Modified Spare Parts shall be substituted for Spare Parts ordered unless the modifications stated in Service Bulletins in the recommended or optional category are considered by Spirit to be unacceptable and Spirit so states in writing to IAE within ninety (90) days of the transmittal date of the applicable Service Bulletin, in which case Spirit shall be entitled to place a single order for Spirit’s anticipated total requirement of pre-modified Spare Parts, at a price and delivery schedule to be agreed.

		
	3.6.3
	Unless Spirit notifies IAE in writing under the provisions of Section 3.6.2 above, IAE may supply at the expense of Spirit a modification of any Spare Part ordered (including any additional Spare Part needed to ensure interchangeability), provided that the modification has received the approval of the Certification Authority.  The delivery of such Spare Parts shall begin on dates indicated by the applicable Service Bulletin.  The delivery schedule shall be agreed at the time when orders for modifications are accepted by IAE.  

		
	3.7
	Inspection

		
	3.7.1
	Conformance to the Specification of Spare Parts purchased hereunder will be assured by IAE through the maintenance of procedures, systems and records approved by the Certification Authority.  Conformance documentation will be issued by IAE to Spirit and signed by IAE personnel authorized for such purpose.

		
	3.7.2
	Conformance of Support Equipment and Vendor Parts purchased pursuant to this Section 3 will be assured by IAE conformance documentation and/or Vendor conformance documentation, as applicable.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	3.7.3
	Upon the issuance of conformance documentation in accordance with Sections 3.7.1 or 3.7.2 above and delivery in accordance with Section 3.8.1 below, Spirit shall be deemed to have accepted the applicable Spare Parts, Support Equipment, and Vendor Parts, and that they conform to the applicable specification without prejudice to any of Spirit’s warranty and support rights under this Contract or any other right of Spirit under applicable law. 

		
	3.8
	Delivery and Packing

		
	3.8.1
	IAE shall deliver Spare Parts, Support Equipment and Vendor Parts if such parts are purchased from IAE pursuant to this Section 3, Ex-Works (INCOTERMS 2000) the point of manufacture. Shipping documents and invoices shall be in accordance with ATA Specification 2000.

		
	3.8.2
	Upon such delivery as described in Section 3.8.1, title to and risk of loss of or damage to the Spare Parts, Support Equipment, and Vendor Parts shall pass to Spirit. 

		
	3.8.3
	In accordance with ATA Specification 2000 requirements, Spirit shall advise IAE at time of order of its instructions as to the marking and shipping of the Spare Parts, Support Equipment and Vendor Parts.

		
	3.8.4
	The packaging of Spare Parts, Support Equipment, and Vendor Parts shall be in accordance with ATA Specification 300 Category 2 standard, unless deviations are otherwise agreed pursuant to Section 3.2 and shall be free of charge to Spirit.  Category 1 standard packaging, if required by Spirit, shall be paid for by Spirit.

		
	3.9
	Prices

		
	3.9.1
	Prices of all Spare Parts, Support Equipment, and Vendor Parts shall be quoted in U.S. Dollars, in the Spare Parts Price Catalog, or Initial Provisioning Data, or in individual quotations.  Such prices shall represent net unit prices, Ex-Works (INCOTERMS 2000), IAE point of manufacture according to Section 3.8.1 above.

Prices and Lead Times in the Spare Parts Price Catalog or by individual quotations are valid for the time period as listed in the Spare Parts Catalog or as shown in the quotation.
		
	3.9.2
	Prices applicable to each order placed by Spirit hereunder shall be the prices in effect at the time of such order according to the terms of the Spare Parts Price Catalog. 

		
	3.9.3
	IAE may from time to time adjust its prices for Spare Parts and Support Equipment upon not less than ninety (90) days prior written notice to Spirit.  Any individual price errors in the calculation of prices may be corrected in good faith without advance notice to Spirit.  

		
	3.9.4
	On request by Spirit, prices of Spare Parts, Support Equipment, or other materials not included in the Spare Parts Price Catalog shall be quoted within a reasonable time by IAE.

		
	3.10
	Payment

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	3.10.1
	Payment for all purchases of Spare Parts, Support Equipment, and Vendor Parts under this Section 3 shall be made by Spirit to IAE *****.  Payment for any other invoices arising under this Contract shall be made by Spirit to IAE *****.  

		
	3.10.2
	Spirit undertakes that IAE shall receive payment in U.S. Dollars of the full amount of payments falling due under this Section 3.10, without any withholding or deduction whatsoever. 

		
	3.10.3
	All payments under this Section 3.10 shall be made by wire transfer to, and shall be deposited not later than the due date of payment with:

*****
or such other account in the United States as otherwise notified from time to time by IAE in writing to Spirit.
		
	3.10.4
	For the purpose of this Section 3.10, payment shall only be deemed to have been made to the extent immediately available funds are received in the account specified in sub-Section 3.10.3 above or as otherwise notified by IAE in accordance with the terms of this Contract. 

		
	3.10.5
	Notwithstanding Section 3.10.1 above, payments for all purchases of Spare Parts, Support Equipment and Vendor Parts shall be due from Spirit upon delivery, or at IAE's option prior to delivery of such  items upon the occurrence of any of the following events:  (a) a receiver or trustee is appointed for any of Spirit's property, or (b) Spirit is adjudicated or voluntarily becomes a bankrupt under any bankruptcy or winding up laws or other similar legislation, or (c) Spirit becomes insolvent or makes an assignment for the benefit of creditors, or (d) Spirit fails to make payment to IAE in accordance with any of Spirit's material obligations to IAE under this Contract or any other agreement with IAE, or (e) is in material default under any section of this Contract after receipt of written notice of such default and the expiration of any applicable cure period in respect thereof.  

		
	3.10.6
	If Spirit fails to make any payment for any Spare Parts, Support Equipment, or Vendor Parts on or before the date when such payment is due, then, without prejudice to any other rights set forth herein or under applicable law, IAE will be entitled to charge interest on the overdue amount, at the rate of the greater of ***** or the New York Citibank prime rate plus ***** per annum, from the date such payment was due to the date such payment is made.  Notwithstanding the foregoing, Spirit shall not be liable for interest in respect of any overdue amount which is being contested in good faith.

		
	3.11
	Conflict

In the event of any conflict between the provisions of this Contract and the provisions of ATA Specifications 101, 2000 and 300, or purchase orders from Spirit the provisions of this Contract shall prevail. 
		
	4.
	Warranties, Guarantees and Liabilities

		
	4.1
	IAE warrants to Spirit that, at the time of delivery, the Supplies sold hereunder will be free of defects in material and manufacture, and will conform substantially to applicable specifications and the rules and regulations of the Certificating Authority.  IAE's liability and 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

Spirit's remedies under this warranty are limited to the repair or replacement, at IAE's election, of Supplies or parts thereof returned to the place of manufacture in accordance with IAE’s written shipping instructions and which are shown to IAE's reasonable satisfaction to have been defective; provided, that written notice of the defect shall have been given by Spirit to IAE within ***** after the first operation or use of the Supplies (or if the Supplies are installed in Spirit Aircraft, *****) after the date of delivery of such Supplies by IAE to Spirit.  Transportation charges for the return of Supplies to IAE pursuant to this Section 4.1 and their reshipment to Spirit and the risk of loss thereof will be borne by IAE only if the Supplies are returned in accordance with written shipping instructions from IAE and judged by IAE, acting reasonably, to have been defective at the time of delivery to Spirit.
		
	4.2
	In addition, IAE grants and Spirit accepts the following (all as set forth in Exhibit D, the “Warranties”):

*****.
		
	4.3
	IAE also grants and Spirit accepts the following (all as set forth in Exhibit E, the “Guarantees”): 

*****.
		
	4.4
	The parties agree that the Warranties shall apply to any equipment that falls within the type of equipment covered by those Warranties, which are manufactured, supplied or inspected by IAE howsoever and whenever (whether before, on or after the date first above written) acquired by Spirit from whatsoever source including but not limited to any V2500 aero engines and any associated equipment therefor, and any parts for such engines and associated equipment that form part of any aircraft acquired from the manufacturer.

		
	4.5
	***** It is not the intent, however, to duplicate benefits or remedies provided to Spirit by IAE or another source (e.g., another equipment manufacturer or lessor) as a result of the same event or cause.  Therefore, notwithstanding the terms of the Warranties and Guarantees, Spirit agrees that it shall not be eligible to receive benefits or remedies from IAE if it stands to receive or has received duplicate benefits or remedies from IAE or another source as a result of the same event or cause.  Furthermore, in no event shall IAE be required to provide duplicate benefits to Spirit and any other party (such as a leasing company) as a result of the same event or cause.

		
	4.6
	IAE and Spirit agree that the following provisions shall apply to each of the Guarantees, unless otherwise expressly set forth therein.

		
	4.6.1
	Definitions and General Conditions

All of the Definitions and General Conditions set forth in the V2500 Engine and Parts Service Policy shall apply to the Guarantees.  Exclusions set forth in the General Conditions of the V2500 Engine and Parts Service Policy shall apply to the Guarantees.
		
	4.6.2
	Specific Conditions

		
	(a)
	The rates and remedies in the Guarantees are predicated upon Spirit operating its Aircraft powered by Engines in accordance with the following operating conditions: 

		
	(i)
	An annual average flight cycle of: ***** hours for V2524-A5 powered Aircraft, ***** hours for V2527-A5 powered Aircraft, and ***** hours 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

for V2533-A5 powered Aircraft (each calculated from the moment the wheels of an Aircraft, on which an Engine is installed, leave the ground on take-off to the moment when the wheels of such Aircraft touch the ground on landing); 
		
	(ii)
	An annual average utilization of ***** hours per V2524-A5 powered Aircraft, ***** hours per V2527-A5 powered Aircraft, and ***** hours per V2533-A5 powered Aircraft; 

		
	(iii)
	An average engine thrust derate of: ***** for V2524-A5 powered Aircraft, ***** for V2527-A5 powered Aircraft,  and ***** for V2533-A5 powered Aircraft, all relative to the name plate thrust rating; 

		
	(iv)
	An average ambient temperature for take-off no greater than: ***** for V2524-A5 powered Aircraft, ***** for V2527-A5 powered Aircraft, and ***** for V2533-A5 powered Aircraft; 

		
	(v)
	Spirit’s main base will be located at Fort Lauderdale, Florida, USA;

		
	(vi)
	Spirit acquiring all of the Aircraft and Firm Spare Engines as set forth in Exhibit B-1 and Exhibit B-2, as amended, supplemented and/or updated from time to time;

		
	(vii)
	Spirit maintaining a minimum ratio of ***** Spare Engines to installed Engines for its Aircraft fleet;

		
	(viii)
	Spirit owning, operating, and maintaining the Aircraft and Engines in regular and frequent airline operation for the duration of the Guarantee period(s), in accordance with Airbus’, IAE’s, and other applicable OEM’s technical manuals and the MMP (including Engine rebuild requirements);

		
	(ix)
	*****; and

		
	(x)
	Spirit acquiring from IAE or other sources sufficient components, Spare Parts, and spare Engines at the levels mutually agreed by IAE and Spirit to maintain proper support of the Engines and Aircraft.

		
	(b)
	Should any of the above operating conditions not be met or if Spirit takes Option Aircraft or Option Spare Engines, IAE, acting in good faith and in consultation with Spirit, may make reasonable and appropriate adjustments to the Guarantees, with appropriate retroactive application, to address any deviations from such operating conditions.

		
	4.7
	SPIRIT ACCEPTS THAT THE WARRANTIES AND GUARANTEES GRANTED TO SPIRIT UNDER SECTIONS 4.1 THROUGH 4.4 ABOVE, TOGETHER WITH THE EXPRESS REMEDIES PROVIDED TO SPIRIT IN RESPECT OF THE SUPPLIES IN ACCORDANCE WITH THIS CONTRACT, ARE EXCLUSIVE AND ARE GIVEN BY IAE IN LIEU OF (A) ANY AND ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE; AND (B) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM, OR REMEDY IN STATUTE, CONTRACT, TORT OR STRICT LIABILITY AGAINST OEM OR 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

ITS AFFILIATES, WHETHER OR NOT ARISING FROM THE NEGLIGENCE, ACTUAL OR IMPUTED (BUT NOT GROSS NEGLIGENCE OR WILLFUL MISCONDUCT), OF IAE OR ITS AFFILIATES, STOCKHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, PERMITTED ASSIGNS AND AGENTS.

		
	4.8
	*****

		
	4.9
	*****

		
	4.10
	*****

		
	4.11
	IAE and Spirit agree that credits issued to Spirit’s account with IAE pursuant to any of the Warranties or Guarantees may be utilized for the purposes identified in the applicable Warranty or Guarantee for up to ***** after the date of issuance.  Within ***** after such date, Spirit may request in writing that the period for such use be extended by IAE for up to an additional ***** period, which request for extension IAE shall not unreasonably deny.  After the expiration of the applicable time period, such credits shall expire.

		
	5.
	Product Support Services

		
	5.1
	IAE will make available to Spirit the Product Support Services described in Exhibit C to this Contract.  Except when identified in such Exhibit C as being at additional cost or as requiring separate contractual arrangements, such Product Support Services shall be supplied at no additional charge to Spirit.  IAE may delegate the performance of product support services to an affiliated company or any of IAE’s shareholders. 

		
	5.2
	Spirit will provide to any IAE customer support representative(s) working at its facility, free of charge:

		
	5.2.1
	reasonable, secure office accommodation including furniture and office equipment and 

		
	5.2.2
	access to telephone, facsimile and secretarial services and 

		
	5.2.3
	access to such first-aid and emergency assistance as is customarily provided to Spirit's own employees and

		
	5.2.4
	reasonable airfare, accommodations, and subsistence during any period in which the customer support representative(s) is required by Spirit to travel away from such customer support representative(s)' normal location at Spirit.

Spirit further agrees and acknowledges that such customer support representative(s) shall at all times remain employees of IAE and shall, in such capacity, be entitled to reasonable working benefits such as leaves of absence, sick days  and holiday as are paid for and granted by IAE to its employees.  However, such leaves shall not interfere with IAE’s provision of the Product Support Services to Spirit, and should any leave for a customer support representative extend beyond forty-five (45) days, IAE agrees to provide a substitute representative to ensure continuity of service.  Notwithstanding the foregoing, at no time shall any IAE customer support representative be considered an employee or independent contractor of Spirit.
		
	6.
	Miscellaneous

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

6.1    Delay in Delivery
		
	6.1.1
	If IAE is hindered or prevented from performing any obligation hereunder including but not limited to delivering any of the Supplies within the time for delivery specified in this Contract (as such time may be extended pursuant to the provisions of this Contract) by reason of:

		
	(a)
	any cause beyond the reasonable control of IAE, or 

		
	(b)
	fires, industrial disputes or introduction of essential modifications required by the Certification Authority, or

		
	(c)
	compliance in good faith with any applicable foreign or domestic governmental regulation or order whether or not it proves to be invalid, except to the extent that the delay is caused by IAE’s failure to act in conformity with applicable deadlines set forth in such governmental regulation or order;

(any such delay an “Excusable Delay”) the time for delivery shall be extended by a period equal to the period for which delivery shall have been so hindered or prevented, and IAE shall not be under any liability whatsoever in respect of such delay. 
		
	6.1.2
	If, by reason of any of the Excusable Delays embraced by Section 6.1.1 above, IAE is hindered or prevented from delivering any goods (that are the same as and include the Supplies) to purchasers (including Spirit) then IAE shall have the right to allocate in good faith such goods, as they become available, at its own discretion among all such purchasers and IAE shall not be under any liability whatsoever to Spirit for delay in delivery to Spirit resulting from such allocation by IAE and the time for delivery shall be extended by a period equal to the delay resulting from such allocation by IAE. *****  

		
	6.1.3
	*****

		
	6.1.4
	The right of Spirit to claim damages shall be conditional upon Spirit (i) notifying IAE of the its claim in writing within ***** from the Claim Start Date, and (ii) submitting a written claim therefor within ***** from the Claim Start Date. 

The “Claim Start Date” shall be the date on which IAE notifies Spirit that the item of the Supplies so delayed is ready for delivery, or from the date on which Spirit exercises the right of cancellation in respect of such item conferred in accordance with Section 6.1.5 below, whichever date shall first occur.  
		
	6.1.5
	Should IAE delay performance of any obligation for a reason other than an Excusable Delay hereunder including but not limited to delivery of any item of the Supplies beyond ***** from the time for delivery specified in this Contract (as such time may be extended pursuant to the provisions of this Contract) then, in addition to the right of Spirit under Section 6.1.3, Spirit shall be entitled to terminate the order with respect to the affected item on giving IAE notice in writing.  Upon receipt of such notice IAE shall be free from any obligation in respect of such item except that IAE shall refund to Spirit any deposits made in respect of the purchase price of such item of the Supplies.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	6.2
	Patents

		
	6.2.1
	IAE shall, subject to the conditions set out in this Section and as the sole liability of IAE in respect of any claims for infringement of industrial property rights, indemnify and hold Spirit harmless from and against any damages, costs and expenses including legal costs resulting from claim that the use of any of the Supplies by Spirit within any country to which at the date of such claim the benefits of Article 27 of the Convention on International Civil Aviation of 7th December 1944 (The Chicago Convention) apply, infringes any patent, design, or model duly granted or registered provided, however, that IAE shall not be liable to Spirit for any consequential damage or any loss of use of the Supplies or of the Aircraft in which the Supplies may be incorporated arising as a result directly or indirectly of any such claim. 

		
	6.2.2
	Spirit will, as soon as reasonably practicable give notice in writing to IAE of any such claim whereupon IAE shall have the right at its own expense to assume the defense of or to dispose of or to settle such claim in its sole reasonable discretion and Spirit will give IAE all reasonable assistance and will not by any act or omission do anything that may directly or indirectly prejudice IAE in this connection, provided that IAE shall not agree to any settlement pursuant to which any fault is attributed to Spirit, without the prior written consent of Spirit.

		
	6.2.3
	IAE shall have the right to substitute for any allegedly infringing Supplies substantially equivalent non-infringing supplies.

		
	6.2.4
	Should Spirit be prevented from using any of the Supplies due to a claim of infringement of property rights by valid judgment or by settlement between Spirit, IAE and the claimant IAE will, at its expense as soon as possible but in no event more than ninety (90) days from the date of entry of such judgment or settlement either: (a) obtain for Spirit the right to use the respective Supply or Supplies free of charge or (b) replace the respective Supply or Supplies with a substantially equivalent non-infringing substitute, if available.

		
	6.2.5
	The indemnity contained in Section 6.2.1 above shall not apply to claims for infringement in respect of (i) Supplies manufactured to the specific design instructions of Spirit; (ii) Supplies not of IAE design (but IAE shall in the event of any claim for infringement pass on to Spirit so far as it has the right to do so the benefits of any indemnity given to IAE by the designer, manufacturer or supplier of such Supplies); (iii) the manner or method in which any of the Supplies is installed in the Aircraft; or (iv) any combination of any of the Supplies with any item or items other than Supplies.

		
	6.3
	(RESERVED)

		
	6.4
	Non-Disclosure and Non-Use

		
	6.4.1
	The terms and conditions of this Contract and any technical information provided in connection with it are confidential and proprietary to IAE and Spirit.  Each Party agrees to: (a) limit disclosures of such confidential information only to persons who have a need to know within their organizations; (b) keep such information confidential; and (c) not disclose to any third party other than (i) as required by applicable law or legal process; (ii) in connection with the disclosure requirements of any applicable government authority or exchange; (iii) to its legal, financial, tax or other advisors who are bound by an obligation of confidentiality or to the 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

confidentiality requirements of this Contract and (iv) in connection with the enforcement of its rights hereunder, without the prior written consent of the other party (not to be unreasonably withheld), provided that, in the case of (c)(i), supra, the Party that is to disclose such confidential information in response to such applicable law or legal process shall forthwith notify the other Party, and upon the request of the other Party, shall cooperate with the other Party in contesting such disclosure. 
		
	6.5
	Taxes

		
	6.5.1
	Subject to Section 6.5.2 below, IAE shall pay all imposts, duties, fees, taxes and other like charges levied by any tax authority or any agency thereof in connection with the Supplies prior to their delivery.

		
	6.5.2
	All amounts stated to be payable by Spirit pursuant to this Contract exclude any value added tax, sales tax or similar such tax.  In the event that the supply of goods or services under this Contract is chargeable to any value added tax, sales tax or similar such tax will be borne by Spirit.  To ensure so far as possible that Spirit is not charged with European Community value added tax (“VAT”), Spirit will within 30 days of signature hereof, inform IAE of its VAT Code (if any) for inclusion on IAE's invoices.

		
	6.5.3
	Spirit shall pay all other imposts, duties, fees, taxes and other like charges by whomsoever levied.

		
	6.5.4
	Notwithstanding the foregoing, Spirit shall have no liability to IAE for any tax or taxes levied on IAE in connection with its gross income, or any franchise, turn-over or other similar tax or any tax levied on IAE relating to its business activities generally and not specifically arising out of or in connection with the transactions contemplated hereby.

		
	6.5.5
	In addition to the foregoing, IAE agrees to cooperate with Spirit in order to minimize the impact of any tax liability arising from the transactions hereunder.

		
	6.6
	Amendment

This Contract shall not be amended in any way other than by written agreement by the parties on or after the date of this Contract, which agreement is expressly stated to amend this Contract.
6.7    (RESERVED)
 
		
	6.8
	Exhibits

In the event of any unresolved conflict or discrepancy between the Exhibits (which are hereby expressly made a part of this Contract) and Sections of this Contract then the Sections shall prevail.
		
	6.9
	Headings

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

The Section headings and the Table of Contents do not form a part of this Contract and shall not govern or affect the interpretation of this Contract.
		
	6.10
	Governing Law and Forum

This Contract shall be subject to and interpreted and construed in accordance with the laws of *****.
*****
		
	6.11
	Compliance with All Applicable Laws and Regulations

		
	6.11.1
	Export/Import Spirit agrees that it will not, directly or indirectly, sell, export, re-export, transfer, divert, or otherwise dispose of any IAE goods, software, technical data (including products derived from or based on such technical data), or services received directly or indirectly from IAE to any Prohibited Party without obtaining prior authorization from the relevant government authorities as required pursuant to Export Laws.  Failure to do so will result in IAE invoking its rights to terminate this Contract per the provisions of Sections 6.15 and 6.16 below.

		
	6.11.2
	“Prohibited Parties” means, collectively, those countries, and persons  to whom the sale, export, re-export, transfer, diversion or other disposition of any IAE goods, software, technical data or services is prohibited by the applicable export laws and related regulations of the United States, German, British, Japanese, or European Union Governments.

		
	6.11.3
	Other Laws and Regulations  Each Party agrees that it will not, by act or omission, violate any applicable law or regulation of the United States or any political subdivision thereof where the violation thereof would result in the other Party being deemed to be in violation of such law or regulation or would otherwise result in a criminal or an un-indemnified civil penalty on the part of such other Party.

		
	6.12
	Notices

Any notice to be served pursuant to this Contract shall be in the English language and is to be sent by certified mail, recognized international carrier or facsimile (with confirmation copy by any of the other means) to:
In the case of IAE:
IAE International Aero Engines AG
400 Main Street, M/S 121-10
East Hartford, Connecticut 06108, United States of America
Facsimile No. 860-565-4003
Attention:  Chief Legal Officer and Company Secretary
In the case of Spirit:
Spirit Airlines, Inc.
2800 Executive Way
Miramar, Florida  33026
Facsimile No. (954) 447-7854

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

Attention: Legal Department
or in each case to such other place of business as may be notified from time to time by the receiving party.
		
	6.13
	Exclusion of Other Provisions and Previous Understandings

		
	6.13.1
	This Contract contains the only provisions governing the sale and purchase of the Supplies and shall apply to the exclusion of any prior provisions on or attached to or otherwise forming part of any order form of Spirit, or any acknowledgment or acceptance by IAE, or of any other document that may be issued by either party relating to the sale and purchase of the Supplies.

		
	6.13.2
	The parties agree that neither of them have placed any reliance whatsoever on any representations, agreements, statements or understandings made prior to the signature of this Contract, whether orally or in writing, relating to the Supplies, other than those expressly incorporated in this Contract, which has been negotiated on the basis that its provisions represent their entire agreement relating to the Supplies and shall supersede all such representations, agreements, statements and understandings.

		
	6.14
	Conditions Precedent

During the term of this Contract, the obligations of IAE to provide, or cause to be provided Supplies or any other benefits to Spirit pursuant to the terms hereof, shall be subject to the non-existence of any of the following events on the date when such Supplies or benefits become due, and should any such event then exist IAE shall be under no obligation to provide, or cause to be provided any Supplies or any other benefits to Spirit:
		
	6.14.1
	A continuing event of default (taking into account any applicable grace period) by Spirit in (a) any payment due under the Contract (including any exhibits and letter agreements thereto), or *****; or

		
	6.14.2
	Any event that is a Termination Event or would be a Termination Event, but for lapse of time, shall have occurred.

		
	6.15
	Termination Events

		
	6.15.1
	Any of the following shall constitute a “Termination Event” under this Contract:

		
	(a)
	Spirit commences any case, proceeding or other action with respect to Spirit or its property in any jurisdiction relating to bankruptcy, insolvency, reorganization, dissolution, liquidation, winding-up, or relief from, or with respect to, or readjustment of, debts or obligations; or

		
	(b)
	Spirit seeks the appointment of a receiver, trustee, custodian or other similar official for Spirit for all or substantially all of its assets, or Spirit makes a general assignment for the benefit of its creditors; or

		
	(c)
	Spirit otherwise becomes the object of any case, proceeding or action of the type referred to in the preceding Sections 6.15.1(a) or 6.15.1(b) that remains unstayed, undismissed or undischarged for a period of sixty (60) days; or

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	(d)
	An action is commenced against Spirit seeking issuance of a warrant of attachment, execution, distraint or similar process against all or substantially all of its assets that remains unstayed, undismissed or undischarged for a period of sixty (60) days; or

		
	(e)
	A continuing event of default (taking into account any applicable grace period) by Spirit on any payment of principal or interest on any indebtedness hereunder or in the payment of any guarantee obligation hereunder *****.

		
	(f)
	Failure to take the Aircraft and Spare Engines in accordance with the delivery schedule set forth in Exhibit B, as amended, supplemented or modified from time to time.

		
	6.15.2
	In the event of the occurrence of a Termination Event, Spirit shall be deemed to be in material breach of this Contract, and IAE shall at its option have the right to resort to any remedy under applicable law, including, without limitation, the right by written notice, effective immediately, to terminate this Contract; provided that, no such notice need be delivered, and this Contract shall automatically terminate upon the occurrence of a Termination Event specified in Section 6.15.1(a), 6.15.1(b), or 6.15.1(c)

		
	6.15.3
	Spirit shall have the option, at its sole discretion, to terminate this Contract in whole or in part, upon the occurrence of any of the following events:

		
	(a)
	IAE commences any case, proceeding or other action with respect to IAE or its property in any jurisdiction relating to bankruptcy, insolvency, reorganization, dissolution, liquidation, winding-up, or relief from, or with respect to, or readjustment of, debt or obligations;

		
	(b)
	IAE seeks the appointment of a receiver, trustee, custodian, or other similar official for IAE for all or substantially all of its assets, or IAE makes a general assignment for the benefit of its creditors;

		
	(c)
	IAE otherwise becomes the object of any case, proceeding or action of the type referred to in the preceding clauses (a) or (b) which remains unstayed, undismissed or undischarged for a period of sixty (60) days;

		
	(d)
	An action is commenced against IAE seeking issuance of a warrant of attachment, execution, distraint or similar process against all or substantially all of its assets which remains unstayed, undismissed, or undischarged for a period of sixty (60) days;

		
	(e)
	A continuing event of default (taking into account any applicable grace period) by IAE on any payment of principal or interest on any indebtedness hereunder or in the payment of any guarantee obligation hereunder *****.

6.16    Effect of Termination
Upon any expiration or termination of this Contract, the rights and obligations of the parties under this Contract will terminate.  Notwithstanding anything herein to the contrary, all liabilities and obligations (including payment obligations) that have accrued prior to termination or expiration will survive.  Notwithstanding the foregoing and for the avoidance of doubt, upon termination, IAE shall have no obligation to deliver goods not yet delivered.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

6.17    No Construction Against Drafter
This Contract has been the subject of negotiation between the parties.  If an ambiguity or question of intent arises with respect to any provision of this Contract, this Contract will be construed as if drafted jointly by IAE and Spirit and no presumption or burden of proof will arise favoring or disfavoring either party by virtue of authorship of any of the provisions of this Contract.
6.18    Damages
In no event shall either Party to this Contract or either Party’s subsidiaries or affiliates, have any liability to any other Party hereto for any indirect, incidental, special, consequential, or punitive damages, including without limitation any damage to or loss of use, revenue or profit with respect to any Aircraft and/or Supplies.
[SIGNATURE PAGE FOLLOWS]

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

        Exhibit A    
Contract Specifications 
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

          Exhibit B    
Schedules 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

      Exhibit B-1     
Aircraft Delivery Schedule 

	
							
	Aircraft No.
	Aircraft Type
	Engine Model
	Scheduled Delivery Date
	MSN
	ESN 1
	ESN 2

	1
	*****
	*****
	*****
	*****
	*****
	*****

	2
	*****
	*****
	*****
	*****
	*****
	*****

	3
	*****
	*****
	*****
	*****
	*****
	*****

	4
	*****
	*****
	*****
	*****
	*****
	*****

	5
	*****
	*****
	*****
	*****
	*****
	*****

	6
	*****
	*****
	*****
	*****
	*****
	*****

	7
	*****
	*****
	*****
	*****
	*****
	*****

	8
	*****
	*****
	*****
	*****
	*****
	*****

	9
	*****
	*****
	*****
	*****
	*****
	*****

	10
	*****
	*****
	*****
	*****
	*****
	*****

	11
	*****
	*****
	*****
	*****
	*****
	*****

	12
	*****
	*****
	*****
	*****
	*****
	*****

	13
	*****
	*****
	*****
	*****
	*****
	*****

	14
	*****
	*****
	*****
	*****
	*****
	*****

	15
	*****
	*****
	*****
	*****
	*****
	*****

	16
	*****
	*****
	*****
	*****
	*****
	*****

	17
	*****
	*****
	*****
	*****
	*****
	*****

	18
	*****
	*****
	*****
	*****
	*****
	*****

	19
	*****
	*****
	*****
	*****
	*****
	*****

	20
	*****
	*****
	*****
	*****
	*****
	*****

	21
	*****
	*****
	*****
	*****
	*****
	*****

	22
	*****
	*****
	*****
	*****
	*****
	*****

	23
	*****
	*****
	*****
	*****
	*****
	*****

	24
	*****
	*****
	*****
	*****
	*****
	*****

	25
	*****
	*****
	*****
	*****
	*****
	*****

	26
	*****
	*****
	*****
	*****
	*****
	*****

	27
	*****
	*****
	*****
	*****
	*****
	*****

	28
	*****
	*****
	*****
	*****
	*****
	*****

	29
	*****
	*****
	*****
	*****
	*****
	*****

	30
	*****
	*****
	*****
	*****
	*****
	*****

	31
	*****
	*****
	*****
	*****
	*****
	*****

	32
	*****
	*****
	*****
	*****
	*****
	*****

	33
	*****
	*****
	*****
	*****
	*****
	*****

	34
	*****
	*****
	*****
	*****
	*****
	*****

	35
	*****
	*****
	*****
	*****
	*****
	*****

	36
	*****
	*****
	*****
	*****
	*****
	*****

	37
	*****
	*****
	*****
	*****
	*****
	*****

	38
	*****
	*****
	*****
	*****
	*****
	*****

	39
	*****
	*****
	*****
	*****
	*****
	*****

	40
	*****
	*****
	*****
	*****
	*****
	*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

       Exhibit B-2     
Spare Engine Price and Delivery
	
						
	Spare Engines
	No.
	Base Price (Jan-06$)
	Engine Model
	Scheduled Delivery Date
	ESN

	Firm Spare Engines
	1
	*****
	*****
	*****
	*****

	2
	*****
	*****
	*****
	*****

	3
	*****
	*****
	*****
	*****

	4
	*****
	*****
	*****
	*****

	5
	*****
	*****
	*****
	*****

	6
	*****
	*****
	*****
	*****

	7
	*****
	*****
	*****
	*****

	8
	*****
	*****
	*****
	*****

	9
	*****
	*****
	*****
	*****

	10
	*****
	*****
	*****
	*****

	11
	*****
	*****
	*****
	*****

	 
	 
	 
	 
	 
	 

	Option Spare Engines
	1
	*****
	*****
	*****
	*****

	2
	*****
	*****
	*****
	*****

	3
	*****
	*****
	*****
	*****

	4
	*****
	*****
	*****
	*****

The applicable price for the Engine bag and transportation stand shall be the list prices set forth below, escalated from the base month to the delivery date of each Spare Engine.
	
		
	Equipment
	Base Price (Jan-06 US$)

	Engine Storage Bag
	*****

	Engine Transportation Stand
	*****

Note: Delivered Spare Engines are indicated by italics typeface.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

         Exhibit B-3    
Escalation Formula 
		
	1.
	Any unit base price or other sum expressed to be subject to escalation from the Base Month (as defined below) to month of delivery or other date of determination in accordance with the IAE Escalation Formula will be subject to escalation in accordance with the following formula:

    
*****

    

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

          Exhibit C    
 
Product Support Plan

PRODUCT SUPPORT

FOR THE

V2500 ENGINE

IAE INTERNATIONAL AERO ENGINES AG

Issue No. 7

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

TABLE OF CONTENTS
1.0    INTRODUCTION    44
2.0    CUSTOMER SUPPORT    44
2.1    CUSTOMER SUPPORT MANAGER    44
2.2    CUSTOMER SUPPORT REPRESENTATIVES    45
2.3    CUSTOMER TRAINING:    45
2.4    ENGINE MAINTENANCE MANAGEMENT    47
2.5    SPECIAL PROGRAMS    48
3.0    BUSINESS SUPPORT    48
3.1    ENGINE WARRANTY SERVICES    49
3.2    MAINTENANCE CENTER SUPPORT    49
3.3    MAINTENANCE FACILITIES PLANNING SERVICE    50
3.4    ENGINE RELIABILITY AND ECONOMIC FORECASTS    50
3.5    LOGISTICS SUPPORT STUDIES    50
3.6    LEASE ENGINE PROGRAM    51
4.0    TECHNICAL SERVICES    51
4.1    TECHNICAL SERVICES    51
4.2    POWERPLANT MAINTENANCE    53
4.3    CUSTOMER PERFORMANCE    53
4.4    DIAGNOSTIC SYSTEMS    54
4.5    HUMAN FACTORS    55
4.6    FLIGHT OPERATIONS    55
4.7    REPAIR SERVICES    56
4.8    TOOLING AND SUPPORT EQUIPMENT SERVICES    57
4.9    TECHNICAL PUBLICATIONS    58
5.0.    SPARE PARTS    61
5.1    SPARE PARTS SUPPORT    61

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

1.0    INTRODUCTION
IAE International Aero Engines AG (IAE) will make the following support personnel and services available to Spirit: Flight Operations, Customer Performance, Customer Support Representatives, Customer Maintenance Support, Technical Services, Powerplant Maintenance, Service Data Analysis, Human Factors, Repair Services, Warranty Administration, Maintenance Facilities Planning, Tooling and Support Equipment Services, Product Support Technical Publications, Customer Training, Spare Parts Support and Maintenance Center Support.  In general, these services are provided ***** to V2500 customers, however, some specific customized services as noted in the descriptions below, may be purchased by Spirit from IAE.
To make these support services readily available to Spirit, in the most efficient manner, the Customer Support Group has been established and assigned primary responsibility within IAE for customer liaison.  A Customer Support Manager is assigned to maintain direct liaison with each individual Customer. A description of the various product support services available to Spirit follows.
IAE reserves the right to withdraw or modify the services described herein at any time at its sole discretion. No such withdrawal or modification shall diminish the level of services and support which Spirit may be entitled to receive with respect to V2500 engines for which an proper order has been placed with IAE or with respect to aircraft with installed V2500 engines for which a firm order has been placed with the aircraft manufacturer, prior to the announcement of any such withdrawal or modification. 
2.0    CUSTOMER SUPPORT 
2.1    CUSTOMER SUPPORT MANAGER
The Customer Support Manager provides a direct liaison between the airline customer's Engineering, Maintenance, Operations, Logistics, Commercial and Financial organizations and the corresponding functions within IAE.  The Customer Support Manager assigned to Spirit is responsible for coordinating and monitoring the effort of the Product Support Department functional organization to achieve timely and responsive support for Spirit.
The Customer Support Manager provides the following specific services to Spirit:
		
	•
	Readiness Program and planning prior to EIS

		
	•
	Technical recommendations and information.

		
	•
	Engine Maintenance Management Plans

		
	•
	Refurbishment, Modification and Conversion program planning assistance.

		
	•
	Coordination of customer repair, maintenance and logistics requirements with the appropriate Product Support functional groups.

		
	•
	Assist with critical engine warranty/service policy claims.

The Customer Support Manager will represent Spirit in IAE internal discussions to ensure that the best interests of Spirit and IAE are considered when making recommendations to initiate a program, implement a change or improvement in the V2500 engine.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

2.2    CUSTOMER SUPPORT REPRESENTATIVES
IAE Customer Support Representatives provide the following services to Spirit:
		
	•
	24 Hour Support

		
	•
	Maintenance Action Recommendations

		
	•
	Daily Reporting on Engine Technical Situations

		
	•
	On-The-Job Training

		
	•
	Service Policy Preparation Assistance

		
	•
	Prompt Communication with IAE

2.2.1    Engine Maintenance Support Service:
Customer Support Representatives assist Spirit’s customer personnel in the necessary preparation for engine operation and maintenance.  The Representative, teamed with a Customer Support Manager will work closely with the airplane manufacturer's support team particularly during the initial period of aircraft operation.  Representatives are in frequent contact with the IAE offices on technical matters. Information and guidance received from the home office is transmitted promptly to Spirit which allows Spirit to share in all related industry experience.
The practice permits immediate use of the most effective procedures and avoidance of unsuccessful techniques. The IAE office contact ensures that IAE Representatives know, in detail, the latest and most effective engine maintenance procedures and equipment being used for maintenance and overhaul of V2500 engines. They offer technical information and recommendations to airline personnel on all aspects of maintenance, repair, assembly, balancing, testing, and spare parts support of IAE.
2.2.2    On The Job Training:
Customer Support Representatives will conduct on-the-job training for Spirit’s maintenance personnel. This training continues until the maintenance personnel have achieved the necessary level of proficiency. Training of new maintenance personnel will be conducted on a continuing basis.
2.2.3    Service Policy Administration:
Customer Support Representatives will provide administrative and technical assistance in the application of the IAE Engine and Parts Service Policy to ensure expeditious and accurate processing of airline customer claims.
2.3    CUSTOMER TRAINING:
2.3.1    IAE Customer Training offers Spirit the following support:
		
	•
	Technical Training at Purpose Built Facilities

		
	•
	On-site Technical Training

		
	•
	Technical Training Consulting Service

		
	•
	Training Aids and Materials

2.3.2    Training Program:
The IAE Customer Training Center has an experienced full-time training staff which conducts formal training programs in English for airline customers' maintenance, training and engineering personnel.  The standard training programs are designed to prepare customer personnel, prior to the delivery of the first aircraft, to operate and maintain the installed engines. Standard courses in engine operation, line maintenance, modular maintenance, performance and trouble-shooting are also available throughout the production life of the engine.  The courses utilize the latest teaching technology, training aids and student handouts. IAE Customer Support will coordinate the scheduling of specific courses as required.   Training at the Customer Training Center is provided to a limit of fifty (50) man-days per aircraft. The following is the curriculum of standard courses available.  On-site technical training, technical training 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

consulting services and customized courses shall be provided upon Spirit’s request and subject to separate contractual arrangements.
2.3.3    General V2500 Familiarization:
This two day course is designed for experienced gas turbine personnel who will be responsible for planning, provisioning and maintenance of the V2500 engine. This course is also designed to appropriately familiarize key staff, supervisory and operations planning personnel and flight crews.  Discussions are concentrated in the following subject areas:
		
	•
	Engine construction features internal and external hardware.

		
	•
	Engine systems operation, major components accessibility for removal/replacement.

		
	•
	Operational procedures

		
	•
	Performance characteristics

		
	•
	Maintenance concepts, repair and replacement requirements and special tooling.

The course is normally conducted in preparation for fleet introductory discussions in the provisioning of spares and tooling, training and line maintenance areas to acquaint the customer with the engine, its systems, operations and procedures.
2.3.4    Line Maintenance and Troubleshooting:
This course is designed for key line maintenance and troubleshooting personnel who have not received previous formal training on the V2500 engine.  The classroom phases provide the student with the information essential for timely completion of line maintenance activities and the procedures for effective troubleshooting and correction of malfunctions in the V2500 engine systems and the engine/airframe interfaces.  Classroom and shop training are provided for in the following areas:
		
	•
	Engine Description

		
	•
	Systems Operation

		
	•
	Applied Performance

		
	•
	Ground Operations

		
	•
	Troubleshooting Procedures

		
	•
	Practical Phase Line Maintenance Tasks

Additional courses are available in Borescope utilization and Engine Conditioning Monitoring (ECM)
2.3.5    V2500 Familiarization and Modular Maintenance:
Provides experienced heavy maintenance personnel with engine modular disassembly and assembly training.  The training is concentrated in the following subject areas:
		
	•
	Engine Description Overview

		
	•
	Engine Systems Overview

		
	•
	Heavy Maintenance Tasks

		
	•
	Course duration and “hands-on” coverage are contingent on the availability of an engine and required tooling.

2.4    ENGINE MAINTENANCE MANAGEMENT
Planning documents, tailored for individual operators, are developed to serve as Engine Maintenance Management Program criteria and should reflect the FAA requirements under which Spirit will operate.  These are directed toward the objective of ensuring cost-effective operation with acceptable post-repair test performance, providing engine reliability to achieve maximum time between shop visits, and minimizing the adverse effects to operation of inflight 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

shutdowns and delays/cancellations.  Through the institution of specific maintenance recommendations, proper engine performance, durability, and hot section parts lives can be achieved.
2.4.1    Operations Monitoring:
The following information is available to Spirit from the IAE Product Information Process (IP) 2 Group:
2.4.2    Operation Experience Reports:
IAE maintains V2500 Service Data System (SDS) data base from which selected engine operations and reliability summary reports will be developed and made available on a scheduled basis to Spirit.  Data reported by IAE Customer Support Representatives serve as input to this data base.  This computerized data maintenance and retrieval system will permit:
		
	•
	A pooling and exchange of service experience for the benefit of the entire airline industry.

		
	•
	A common statistical base.

		
	•
	The selective querying of computer data files for answers to Spirit’s inquiries.

In addition to providing operations, reliability and VIS reports, SDS serves in-house programs directed at improving engine design and enhancing overall customer support, including spare parts provisioning and warranty administration.
2.5    SPECIAL PROGRAMS
2.5.1    Engine Hardware Retrofit:
Engine Retrofits are carried out to provide modification of engine hardware configuration when required on delivered engines.  This involves assisting in the marshaling of hardware, special tools, manpower and the scheduling of engine and material to modification sites.
2.5.2    Controlled Service Use Programs and Material:
IAE shall assume responsibility for the planning, sourcing, scheduling and delivery of Controlled Service Use material, warranty replacement material, service campaign material and program support material subject to the terms of special contracts with Spirit.
Urgent customer shipments, both inbound and outbound, are monitored, traced, routed and expedited as required.  The receipt and movement of customer owned material returned to IAE is carefully controlled, thus assuring an accurate accounting at all times.
3.0    BUSINESS SUPPORT
The Business Support Group is dedicated to providing prompt and accurate assistance to you, our V2500 airline customer.  This Group provides the following categories of assistance and support to Spirit:
		
	•
	Engine Warranty Services

		
	•
	Maintenance Support

		
	•
	Lease Engine Program

		
	•
	Engine Reliability and Economic Forecasts

		
	•
	Logistic Support Studies

3.1    ENGINE WARRANTY SERVICES
Engine Warranty Services will provide the following support for the V2500 engine airline customer:

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	•
	Prompt administration of claims concerning Engine Warranty, Service Policy, other support programs and Guarantee Plans.

		
	•
	Investigation of part condition and part failure.

		
	•
	Material provisioning administration for Controlled Service Use programs and other material support.

3.1.1    Prompt Administration:
Spirit is assigned a Warranty Analyst whose job is to provide individual attention and obtain prompt and effective settlements of Warranty and Service Policy claims.  A typical claim properly submitted is generally settled, including issuance of applicable credit memo, within thirty days.  Experience generated by much of the data derived from such claims often enables IAE to monitor trends in operating experience and to address and often eliminate potential problems.
3.1.2    Investigation and Reports:
Parts returned to IAE pursuant to the terms of the Service Policy are investigated in appropriate detail to analyze and evaluate part condition and cause of part failure.  A report of findings is prepared and forwarded to Spirit and to all IAE departments involved.  In the case of vendor parts, the vendor is promptly informed.  Where relevant, reports will include recommendations to preclude repetition of the problem.
3.2    MAINTENANCE CENTER SUPPORT
IAE has arranged for the establishment of Maintenance Centers which are available to accomplish repairs, modifications and conversions, as well as the complete overhaul of the V2500 engine subject to IAE's standard terms and conditions for such work.
Through the use of the IAE established Maintenance Centers and their capabilities, an operator can minimize or eliminate the need for investment in engine support areas depending on the level of maintenance he elects the Maintenance Center to perform.  Savings in specific engine support areas, such as spare parts inventory, maintenance and test tooling, support equipment and test facilities, can be demonstrated.  Use of Maintenance Centers can also minimize the need for off-wing maintenance and test personnel with their associated overhead.
3.3    MAINTENANCE FACILITIES PLANNING SERVICE
Maintenance Facilities Planning Service offers the following support to IAE customer:
		
	•
	-    General Maintenance Facility Planning Publications

		
	•
	-    Customized Facility Plans

		
	•
	-    Maintenance Facility and Test Cell Planning Consultation Services

Maintenance Facilities Planning Service provides general and customized facility planning data and consultation services.  Facility Planning Manuals for the V2500 engine will present the maintenance tasks, facility equipment and typical departments’ floor plans showing arrangement of equipment required to accomplish the tasks for all levels of maintenance.  The Facility Equipment Manual is a catalog of standard facility equipment such as lathes, process tanks, hoists, cranes, etc., which is suitable for use in the maintenance and testing of IAE engines.
Customized facility planning services and consulting services are offered subject to separate contractual arrangements.  Customized facility plans are developed to meet the requirements of customers' specific fleet sizes, activities and growth plans.  The plans identify floor space, facility equipment, utilities and manpower requirements.  On-site surveys are conducted as a part of customized plan development to determine the adaptability of existing facilities and equipment for the desired maintenance program.  These plans provide floor plan layouts to show recommended locations for work stations, major equipment, marshaling and storage areas, workflow patterns, and structural and utility requirements to accommodate all the engine models that are maintained in the customer's shop.  The Maintenance Facilities Planning Service also provides consultant services which are specifically related to the development of engine test cells, and the adaptation of existing maintenance facilities to accommodate expanding production requirements and/or new or additional IAE models.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

3.4    ENGINE RELIABILITY AND ECONOMIC FORECASTS
Engine reliability and economic forecasts in the forms of predicted shop visit rates and maintenance costs can be provided to reflect the airline customers' operating characteristics.  Additionally, various analyses can be conducted to establish life probability profiles of critical engine parts, and to determine optimum part configuration and engine operating procedures.
3.5    LOGISTICS SUPPORT STUDIES
As required, logistics studies are conducted to assist in the planning of engine operational support.  Such studies may include spare engine and spare module requirements forecasts, level of maintenance analyses, engine type economic evaluations and life cycle cost estimates.
3.6    LEASE ENGINE PROGRAM 
An engine lease program will be made available to Spirit subject to IAE's standard terms and conditions of lease as per IATA Master Short Term Lease Agreement, form 5016 00.  Pool spares will be stationed at selected locations to assure emergency protection against aircraft-on-ground (AOG) situations or to provide supplemental support during “zero spares” conditions. Lease engines offered to Customer will be of a configuration and certification standard acceptable to Customer.  Availability will be subject to prior demand; however, the program logistics will be continually reviewed to assure the most effective deployment of available pool engines.
4.0    TECHNICAL SERVICES
4.1    TECHNICAL SERVICES
The Technical Services Group provides the following categories of technical support to the airline customer:
		
	•
	Technical Services

		
	•
	Powerplant Maintenance

		
	•
	Customer Performance 

		
	•
	Diagnostic Systems 

		
	•
	Human Factors

		
	•
	Flight Operations 

		
	•
	Repair Services

		
	•
	Tooling and Support Equipment Services

		
	•
	Technical Publications

Technical Services is responsible for the overall technical support to the customers. The following services are provided:
		
	•
	Technical Problem Identification/Corrective Action 

		
	•
	Implementation

		
	•
	Technical Communication

		
	•
	Engine Conversion Program Definition and Management

		
	•
	Engine Upgrade and Commonality Studies

		
	•
	Engine Incident Investigation Assistance

Technical information supplied through IAE Customer Support Representatives, Customer Support Managers, customer correspondence and direct meetings with airlines' representatives permits assessment of the factors involved in technical problems and their impact on engine reliability and operating costs.  Resolution of these problems is coordinated with responsible groups within IAE and the necessary corrective action is defined.  In certain situations the corrective action involves the establishment of Service Evaluation programs for proposed modifications, and the establishment of warranty assistance programs in conjunction with the IAE Warranty Administration Group.  Technical Services will assist customers in the implementation of recommended corrective action and improvements principally through official IAE technical communications, and direct customer contact.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

4.1.1    Technical Communications:
Technical Services is responsible for the release of technical communications.  Primary communication modes involves release of limits and procedures through engine and maintenance manual revisions and the requirements associated with engine upgrade and/or conversion, durability and performance improvements, and problem resolution through Service Bulletins is provided by All Operator Letters and/or wires or direct technical written response to individual customer inquiries.
4.1.2    Engine Conversion Programs:
Technical Services defines minimum configuration levels for conversion of service engine models.  They serve to assist the customer with the implementation of conversion programs into existing fleets by providing preliminary planning cost estimates and technical planning information regarding tooling, material and instructional requirements.  Conversion programs are monitored for problem areas and Technical Services initiates and implements corrective action as may be necessary.
4.1.3    Engine Incident Investigation Assistance:
Assistance is provided to an airline in conducting engine incident investigations in responding to the requirements of the Certification Authority and the appropriate Airworthiness authority, as applicable.
4.1.4    Line Maintenance and Troubleshooting:
Line Maintenance and Troubleshooting Seminars can be conducted at the IAE Training Center with the objective of improving line maintenance effectiveness fleetwide.  Specialized training on V2500 line maintenance and troubleshooting can be provided through on-site workshops by special contractual arrangement.
Troubleshooting support is provided primarily through powerplant troubleshooting procedures which are published in IAE and airframe manufacturer’s manuals.  When an airline encounters an engine problem and corrective action taken has not been effective, more direct support in troubleshooting and maintenance can also be provided to the customer’s line maintenance personnel.  Instructions on V2500 powerplant troubleshooting and maintenance shall also be provided to customer’s line maintenance personnel.
4.1.5    Airline Shop Maintenance:
Reviews of shop practices and procedures of Spirit shall be conducted, if requested by Spirit, to determine the most efficient and cost-effective methods for maintenance and repair of the V2500 in the environment in which the airline must maintain that engine.  
4.2    POWERPLANT MAINTENANCE
Powerplant Maintenance covers responsibility for maximizing engine maintainability, establishing maintenance concepts and requirements and providing maintenance support plans for IAE.  This group provided the following services:
		
	•
	Definition of Maintenance Tasks and Resource Requirements

		
	•
	Planning Guides

Powerplant Maintenance conducts design reviews and comprehensive maintenance analysis of new engine designs and engine design changes to maximize engine maintainability consistent with performance, reliability, durability and life cycle cost considerations.  Maintenance concepts, requirements and tasks are established to minimize maintenance costs.  This group represents Spirit’s maintainability interests in internal IAE operations and upon request will assist Spirit in resolving specific maintenance task problems.
4.2.1    Progressive Maintenance Planning:
Powerplant Maintenance also provides Planning Guides based upon Maintenance Task Analysis.  The guides present engine maintenance requirements, their subordinate tasks and the required resources to accomplish on-aircraft engine maintenance and the off-aircraft repair of engines by modular section/build group replacement.  Maintenance requirements are also presented for the refurbishment of modular 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

section/build group by parts replacement, the complete repair of parts, the refurbishment of accessory components and for engine testing.  The data in the Planning Guides is presented in a manner that is primarily intended to assist new operators by providing a phased introduction of new engines into their shops and to capitalize on the design maintainability features for the engine when they are developing their maintenance plans.
Powerplant Maintenance Engineering will assist new operators in planning a gradual, technically feasible, and economically acceptable expansion from line maintenance of installed engines through the complete repair of parts and accessory components.
4.3    CUSTOMER PERFORMANCE
Customer Performance provides for the following types of technical assistance to Spirit:
		
	•
	Engine Performance Analysis Computer Programs for Test Cell Use

		
	•
	Test Cell Correlation Analysis and Correction Factors

		
	•
	Engine Stability Procedures and Problem Analysis

Although much of the above support is provided in the form of procedures, data and recommendations in various publications, the group also answers inquiries of a performance nature which are forwarded to IAE by individual customers.
ENGINE PERFORMANCE ANALYSIS
Technical support is provided in a number of areas related to operational suitability including the development of the test requirements and performance limits for the Adjustment and Test Section of the Engine Manual.  Computer programs that will assist Spirit in analyzing engine performance using test cell data can be provided subject to IAE’s then current standard license fees and Terms and Conditions.
4.3.1    Test Cell Correlation:
Technical assistance is provided to Spirit for developing appropriate corrections to be used for specific test configurations at Spirit’s owned test cell facilities.  Reports are provided presenting correlation analyses and IAE recommended test cell corrections which permit comparison of the performance of Spirit tested engines with the respective Engine Manual limits and guarantee plan requirements.
4.3.2    Engine Stability:
Technical support is provided to ensure that engine stability and starting reliability are maintained.  Service evaluation programs for proposed improvements are initiated and monitored to determine their effectiveness.  In addition, problems relating to engine control systems which impact engine stability and performance are analyzed.
4.4    DIAGNOSTIC SYSTEMS
ADEM is responsible for the technical support of Spirit’s acquisition of inflight engine data and the assessment of engine performance through the use of that data.  ADEM personnel provide the following services:
		
	•
	Guidance to help Spirit define their engine monitoring system requirements.

		
	•
	Development of hardware specifications and computer programs (by separate contractual arrangement) to satisfy engine diagnostic requirements.

		
	•
	Coordination of all IAE airborne diagnostic support activity.

4.4.1    Guidance In Defining Engine Monitoring systems Requirements:
ADEM can provide consultation services to assist Spirit in defining its engine condition and performance monitoring requirements and in selection of appropriate hardware and software systems to meet those requirements and options between Spirit, airframe manufacturer, and Airborne Integrated Data System (AIDS) manufacturer.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

4.4.2    Development and Coordination
ADEM personnel can, if requested by Spirit, develop hardware specification and make computer software available to accomplish Engine Condition Monitoring (ECM) and performance analysis of engine modules using AIDS data.  Engine condition monitoring procedures, of both the manual and computerized variety can, if requested by Spirit, also be developed and provided in support of Spirit’s selected method of engine condition monitoring.  Computer software will be provided to Spirit subject to IAE's then current standard license fees and Terms and Conditions.
Diagnostic Systems personnel also coordinate activities of cognizant functional groups at IAE to provide engine related information to Spirit, airframe manufacturer, and AIDS equipment vendor during the planning, installation, and operation of AIDS.
4.5    HUMAN FACTORS
Human Factors supplies data on task time and skill requirements necessary for accomplishing maintenance procedures.
Task data provided includes estimates of the man-hours, elapsed time and job skills necessary to accomplish maintenance tasks as described in IAE's Manual and Service Bulletins.  Data is supplied for “on” and “off” aircraft maintenance tasks up to modular disassembly/assembly.  Additional selected task data can, if requested by Spirit, be supplied on disassembly/assembly to the piece part level and on parts repair.  In addition, the group can, if requested by Spirit, help solve problems related to skill requirements, body dimensions, or excessive man-hours encountered in accomplishing maintenance tasks.
4.6    FLIGHT OPERATIONS
Flight Operations provides Spirit with the following technical assistance concerning installed engine operations:
		
	•
	Introduction of new equipment

		
	•
	Problem resolution and assistance with in-service equipment

		
	•
	Contractual commitment and development program support

		
	•
	Publication of engine operations literature and performance aids

4.6.1    New Equipment:
In accordance with Spirit’s needs, Flight Operations can provide on-site assistance in the training of operations personnel and help in solving engine operational problems that might arise during the initial commercial service period.  Such assistance can, if requested by Spirit, include participation in initial delivery flights, engine operational reviews, and flight crew training activity.
4.6.2    Problem Resolution - In-Service Equipment:
In accordance with a mutually agreed upon plan, Flight Operations can, if requested by Spirit, perform cockpit observations to identify or resolve engine operating problems and to assess installed engine performance.
4.6.3    Contractual Support and Development Programs:
As required, Flight Operations can assist in evaluating installed engine performance relative to contractual commitments and engine improvements which have an impact on engine operations.
4.6.4    Publication Support:
Flight Operations is responsible for the issuance of Propulsion System Operating Instructions and correspondence pertaining to in-flight engine operations.  Such material is coordinated with the airframe manufacturers as required.  Special Presentations and Reports shall also be issued, as required, to support the activity described above.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

4.7    REPAIR SERVICES
Repair Services shall provide the following support to Spirit:
		
	•
	Coordinated Repair Development Activity

		
	•
	Customer Assistance on Repair Procedures and Techniques

		
	•
	Qualification of Repair Sources

		
	•
	Repair Workshops

		
	•
	Repair Development List

4.7.1    Coordination of Repair Development:
Repair Services shall provide direct contact with all sources that initiate repair schemes.  The Group shall coordinate with representatives of Engineering and Support Services disciplines in identifying repair needs, evaluating various repair options and establishing repair development procedures and schedules.  The Group shall participate in setting repair evaluation and approval requirements.  If and when the repair is approved and substantiating data is documented, Repair Services shall release the repair to the Engine Manual.
4.7.2    Technical Assistance:
Repair Services shall provide daily communications with Spirit via technical responses to inquiries direct from Spirit or through IAE’s Customer Support Representative office at Spirit’s facility.  In addition, Repair Services shall make periodic visits to Spirit’s repair facilities to discuss new repairs under development, answer specific questions posed by the particular facility and review actual parts awaiting a repair/scrap decision.  Occasionally, Repair Services make special visits to Spirit’s facilities to assist in training customer personnel in accomplishing particularly complex repairs.
4.7.3    Qualification of Repair Sources:
Repair Services shall coordinate the qualification of repair sources for repairs proprietary to IAE or to an outside repair agency.  They also perform a review of the qualifications of repair sources for critical, nonproprietary repairs for which a source demonstration is deemed necessary.  The group shall participate in negotiation of the legal and business agreements associated with these qualification programs.
4.8    TOOLING AND SUPPORT EQUIPMENT SERVICES
The Tooling and Support Equipment Services Group shall, as requested by Spirit, assist Spirit by providing the following services:
		
	•
	Support Equipment Manufacturing/Procurement Documentation

		
	•
	Engine Accessory Test Equipment and Engine Transportation Equipment Specifications

		
	•
	Support Equipment Logistics Planning Assistance

4.8.1    Support Equipment Documentation:
The tooling and Support Equipment Services Group designs the special support equipment required to disassemble, assemble, inspect, repair and test IAE engines. Special support equipment design drawings and Support Equipment Master Data Sheets, which describe how to use the support equipment, shall be supplied to Spirit in the form of 35mm aperture cards. Support equipment designs are kept current with engine growth, and tool Bulletins are issued to customers as part of continuing configuration management service.  Updated Design and Master Data Sheets Aperture Cards and Tool Bulletins are periodically distributed to all IAE customers, including Spirit.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	4.8.2
	Engine Accessory Test Equipment and Engine Transportation Equipment Requirements:

Engine accessory test equipment and engine transportation equipment general requirements and specifications are defined and made available to Spirit.  If requested, the Tooling and Support Equipment Group will assist Spirit in the definition of engine accessory test and engine transportation equipment required for specific IAE needs.
4.8.3    Support Equipment Logistics Planning Assistance:
The Tooling and Support Equipment Group shall provide, at Spirit’s request, special support equipment lists which reflect the customer's unique requirements such as mix of engine models and desired level of maintenance to aid in support of equipment requirements planning.
		
	4.9
	TECHNICAL PUBLICATIONS

IAE and its subcontractors produce publications and maintenance information as described below to support the maintenance and modification requirements of the airline customer.  The publications are prepared in general accordance with Air Transport Association of America (ATA) Specification No. 100.  The manuals will be available to Spirit subject to IAE’s current terms and conditions.
IAE supplies the airplane manufacturer with all the necessary information required to perform “On-Aircraft” engine maintenance, troubleshooting, and servicing.  This information is developed through close coordination between the airplane manufacturer and IAE and is integrated by the airplane manufacturer into its maintenance publications.
In addition, listed and described below are the publications that IAE will make available to support Spirit’s maintenance program:
4.9.1    Engine Manual
The Engine Manual is a document which will be structured in accordance with ATA 100 section 2-13-0 with JEMTOSS applied in accordance with section 2-13-14. The manual will provide, in one place, the technical data requirements for information needed to maintain the engine and the maximum potential number of parts that could, regardless of design responsibility, remain with the engine when it is removed from the airplane.  Additionally the manual includes coverage of interrelated parts (e.g. thrust reverser, cowlings, mounts, etc.) that can stay with the airplane when the engine is removed or can be removed for maintenance purposes in lieu of individual component maintenance manuals.
4.9.2    Standard Practices Manual
The Standard Practices Manual supplements the Engine Manual by providing, in a single document, all IAE recommended or approved general procedures covering general torques, riveting, lockwiring, cleaning policy, inspection policy standard repairs, etc., and marking of parts.
4.9.3    Illustrated Parts Catalog
The Illustrated Parts Catalog will be structured in accordance with ATA 2-14-0 and is a document which is used in conjunction with the Engine Manual for the identification and requisitioning of parts and assemblies.  Its ATA structure is to be compatible with the Engine Manual Structure.  Additionally the manual includes coverage of interrelated parts (e.g. thrust reverser, cowlings, mounts, etc.) that can stay with the airplane when the engine is 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

removed or can be removed for maintenance purpose in lieu of individual component maintenance manuals.
4.9.4    IAE Proprietary Component Maintenance Manuals
These manuals will be structured in accordance with ATA 2-5-0 and will cover data for chapters other than 71, 72, and 78.
4.9.5    Subcontractor Component Maintenance Manuals
These manuals will be structured in accordance with ATA 2-5-0 and are prepared directly by the accessory manufacturers.  All accessory data is subject to IAE prepublication review and approval.
4.9.6    Engine and Accessory Component Service Bulletins
Each Engine and Accessory Component Service Bulletin will be produced in accordance with ATA 2-7-0.  They will cover planning information, engine or component effectivity, reason for Bulletin, recommended compliance, manpower requirements, and tooling information relating to parts repair or modification. Subcontractor prepared Accessory Component Service Bulletins are reviewed by IAE prior to issuance.  Alert Service Bulletins will be issued on all matters requiring the urgent attention of Spirit and will generally be limited to items affecting safety.  The Bulletin will contain all the necessary information to accomplish the required action.
4.9.7    Operating Instructions
Engine operating instructions are presented in the form of General Operating Instructions supplemented by V2500 Specific Engine Operating Instructions which provide operating information, procedures, operating curves and engine limits.
4.9.8    Facilities Planning and Facility Equipment Manuals
The Facilities Planning Manual outlines the requirements for engine/component overhaul, maintenance, and test facilities in terms of basic operations, processes, time studies and equipment.  The Facility Equipment Manual lists and describes the facility equipment used for engine maintenance, overhaul and repair.
4.9.9    Support Equipment Numerical Index
The Indexes, prepared for each major engine model, provide a listing, in numeric sequence, by maintenance level, of all IAE ground support equipment required to maintain and overhaul the engine.  The Listings are cross-indexed to the applicable engine dash model and to the chapter and section of the Engine Manual.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

4.9.10    Technical Publications Index
This index contains a listing of available technical manuals and their contents. 
4.9.11    Service Bulletin Index
This index will be in a format and on a revision schedule as determined by IAE.
4.9.12    Vital Statistics Logbook
The VSL provides the following information for each production engine on IAE’s interactive website.
		
	1
	Identification of major engine and nacelle components by part number, serial number and ATA - location.

		
	2
	Engine Test Acceptance Certificate.

		
	3
	List of all incorporated serialized parts by part number, serial number and ATA - Location.  This list also includes an Industry Item List to identify specific parts by part number, serial number and ATA - Location which the airline customer may choose to monitor during the engine operational life.  The parts listed represent approximately 80% of engine total value.

		
	4
	List of all incorporated life limited parts by part number, serial number and ATA - location.

		
	5
	List of all Service Bulletins that were incorporated during initial build of each new engine.

4.9.13    Revision Services:
Regular, temporary, and “as required” revisions to technical publications will be made during the service life of IAE equipment.  IAE’s current standard is ninety (90) days.  The utilization of advanced techniques and equipment provides the airline customer with expedited revision service.
4.9.17    Distribution Media Options:
All publications are distributed via DVD or CDROM depending on the publication.  Most of the publications are also available on IAE’s interactive website.
5.0.    SPARE PARTS
5.1    SPARE PARTS SUPPORT
The Spare Parts Group provides the following categories of spare parts support to Spirit, as requested by Spirit:
		
	•
	-    Individual Customer Account Representatives

		
	•
	-    Provisioning

		
	•
	-    Planning

		
	•
	-    Order Administration

		
	•
	-    Spare Parts Inventory

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	•
	-    Effective Expedite Service

		
	•
	-    Worldwide Distribution

5.1.1    Account Representative:
An Account Representative shall be assigned to Spirit.  This representative provides individualized attention for effective spare parts order administration, and is the customer's interface on all matters pertaining to new part planning and procurement.  Each representative is responsible for monitoring Spirit’s requirements and providing effective administrative support.  The Account Representatives shall be thoroughly familiar with Spirit’s spare parts ordering policies and procedures and are responsible for ensuring that all of Spirit’s new parts orders are processed in an effective manner.
5.1.2    Spare Parts Provisioning Planning:
Prior to delivery of the first Spirit aircraft, preplanning discussions will be held to determine the aircraft/engine program, and engine spare parts provisioning and order plans.  Mutually agreed upon provisioning target dates are then established and on-time completion tracked by Spirit’s Account Representative with the assistance of logistics specialists in Spare Parts Provisioning and Inventory Management.  Meetings are held with Spirit at a mutually agreeable time to review suggested spare parts provisioning lists prepared by Spare Parts Provisioning.  These lists are designed to support Spirit’s particular fleet size, route structure and maintenance and overhaul program.
5.1.3    Order Administration:
IAE subscribes to the general principles of Air Transport Association of America (ATA) Specification No. 2000, Integrated Data Processing - Supply.  The procedures of Air Transport Association of America (ATA) Specification No. 200 may be used for Initial Provisioning (Chapter II), Order Administration (either Chapter III or Chapter VI), or Invoicing (Chapter IV).
A spare parts supply objective is to maintain a 90 percent on-time shipment performance record to Spirit’s requirements.  The lead time for replenishment spare parts is identified in the IAE spare Parts Price Catalog.  Initial provisioning spare parts orders should be placed at least six months prior to required delivery, while conversions and major modifications require full manufacturing lead times.
The action to be taken on emergency requests will be answered as follows:
		
	•
	Aircraft-On-Ground (AOG) - within four hours (in these instances every effort is made to ship immediately).

		
	•
	Critical (Imminent Aircraft-On-Ground (AOG) or Work Stoppage) -- Within 24 hours.

		
	•
	Stock Outage -- Within seven working days (these items are shipped as per Spirit’s request).

5.1.4    Spare Parts Inventory:
To ensure availability of spare parts in accordance with published lead time, spare parts provisioning maintains a modern, comprehensive requirements planning and inventory management system which is responsive to changes in Spirit’s demand, special support programs and engineering design.  Organized on an engine model basis, this system is intended to maintain part availability for delivery to customers consistent with published lead times.
A majority of parts in the spare parts inventory are continually controlled by an Automatic Forecasting and Ordering System.  Those parts which do not lend themselves to automatic control due to supercedure, unusual usage or conversion requirements are under the direct manual control of Spares Planning personnel.  As additional protection against changes in production lead time or unpredicted demand, certain raw materials are also inventoried.  Successful inventory management is keyed to accurate requirements planning.  In support of the requirements planning effort, a wide ranging data retrieval and analysis program is offered.  This program concerns itself both with the customer logistics and technical considerations as follows:

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	•
	Forecasts of life limited parts requirements are requested and received semi-annually from major customers.  Based on the size of Spirit’s order, Spirit shall be considered a major customer. 

		
	•
	Engine technical conferences are held frequently within IAE to assess the impact of technical problems on parts.

		
	•
	For a selected group of parts a provisioning conference system is offered which considers actual part inventory change, including usage and receipts, as reported monthly by participating customers.

5.1.5    Packaging
All material is packaged in general compliance with Air Transport Association of America (ATA) Specification No. 300.
5.1.6    World Airline Supplier’s Guide:
IAE subscribes to the supply objectives set forth in the World Airlines Supplier's Guide published by the Air Transport Association of America (ATA).  IAE requires that its proprietary component vendors also perform in compliance with the precepts of the World Airline Suppliers' Guide.
    

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

          Exhibit D     
Warranties
 
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

          Exhibit E     
Guarantees
 
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

400 Main Street, M/S 121-10
East Hartford, CT 06108 USA
 
October 1, 2013

Spirit Airlines, Inc.
2800 Executive Way
Miramar, Florida 33025

		
	SUBJECT:
	SIDE LETTER NO. 1 TO THE AMENDED AND RESTATED V2500-A5 GENERAL TERMS OF SALE BETWEEN IAE INTERNATIONAL AERO ENGINES AG AND SPIRIT AIRLINES, INC., OCTOBER 1, 2013

Gentlemen:

We refer to the Amended and Restated V2500-A5 General Terms of Sale dated October 1, 2013 between IAE International Aero Engines AG (“IAE”) and Spirit Airlines, Inc. (“Spirit”), as amended from time to time, such agreement being hereinafter referred to as the “Contract”.  Unless expressly stated to the contrary, and to the extent possible, terms used in this Side Letter No. 1 (“Side Letter No. 1”) shall have the same meaning given to them in the Contract. 
WHEREAS:
		
	A.
	IAE and Spirit previously entered into the 2005 GTA, and subsequently entered into the 2006 Proposal, both of which have been superseded by the Contract; and

		
	B.
	This Side Letter No. 1 amends the Contract so as to provide certain financial and technical assistance to Spirit in support of Spirit’s selection of the V2500 engine to power its Aircraft, and in support of the integration of the Aircraft into its fleet.

NOW, THEREFORE, in consideration of the mutual benefits and obligations set forth herein, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
1.    Fleet Introductory Assistance Credits
		
	1.1
	In consideration of Spirit’s agreement to purchase Aircraft No. 20 through Aircraft No. 40 inclusive, in accordance with the Contract, and to assist Spirit with the introduction of the Aircraft into its fleet, IAE shall issue credit notes to Spirit’s account with IAE in the following amounts (each a “Standard FIA Credit”):

	
			
	Aircraft Type
	Credit
(Jan-06 US$) 
	Issued at Delivery & Acceptance of:

	A319 (V2524-A5)
	*****
	Each A319 Aircraft

	A320 (V2527-A5)
	*****
	Each A320 Aircraft

	A321 (V2533-A5)
	*****
	Each A321 Aircraft

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

For clarity, the financial assistance provided by IAE for Aircraft No. 1 through Aircraft No. 19 inclusive was issued in accordance with the 2006 Proposal.

		
	1.2
	***** 

		
	1.3
	*****

		
	1.4
	***** 

2.    Spare Engine Credits 
		
	2.1
	In consideration of Spirit agreeing to purchase the Spare Engines in accordance with the Contract, and to assist Spirit with such purchase, IAE shall credit Spirit‘s account in accordance with the following values for the corresponding Spare Engines (each a “Spare Engine Credit”):

	
			
	Engine Type
	Credit
(Jan-06 US$) 
	Issued on Delivery & Acceptance of:

	V2524-A5
	*****
	Each Firm Spare Engine

	V2527-A5
	*****
	Each Firm Spare Engine

	V2533-A5
	*****
	Each Firm Spare Engine

	V2524-A5
	*****
	Each Option Spare Engine

		
	2.2
	*****

		
	2.3
	Each Spare Engine Credit ***** shall be issued upon delivery to Spirit of the corresponding Firm or Option Spare Engine. Spirit agrees to provide IAE with written notice confirming acceptance of the corresponding Firm or Option Spare Engine promptly after acceptance.

  
		
	2.4
	Each Spare Engine Credit ***** shall be used by Spirit for payment against the corresponding spare Engine invoice.  

3.    Credit and Engine Pricing Escalation
		
	3.1
	The FIA Credits and Spare Engine Credits, referenced in Sections 1and 2above, are subject to escalation in accordance with the IAE Escalation Formula set forth in Exhibit B-3 to the Contract, and shall be escalated from a base month of January 2006 (the “Base Month”) to the earlier of the scheduled delivery date as set forth in Exhibit B-1 (and B-2 if applicable) of the Contract or the actual delivery date of the applicable Aircraft or Spare Engine (the “Base Escalated Credit”).

		
	3.2
	*****

		
	3.3
	*****

		
	3.4
	*****

		
	3.5
	Upon delivery of each Aircraft, IAE will, as of the respective dates of delivery of each of the Aircraft delivered to Spirit, calculate the difference (if any) between:

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

		
	(a)
	The Deemed Shipset Price (as defined below) escalated in accordance with Section 3.1 above; minus 

		
	(b)
	The Deemed Shipset Price escalated in accordance with Section 3.1 above and capped in accordance with Section 3.2 above.  

IAE will adjust the amount of the FIA Credits due and payable to Spirit for each such Aircraft by such difference.  For the purposes of administering this provision, the “Deemed Shipset Price” is as follows:
	
		
	Aircraft Type
	Deemed Shipset Price (Jan-06 US$)

	A319 (V2524-A5)
	*****

	A320 (V2527-A5)
	*****

	A321 (V2533-A5)
	*****

•

4.    *****
5.    *****
		
	5.1
	Clause 6.3 of the Contract, *****, is deleted in its entirety and replaced with the following:

“6.3    *****

		
	6.3.1.
	*****

		
	6.3.2
	*****

		
	6.3.3
	IAE shall have the right to set off credits from time to time made available by IAE under the Contract either directly to Spirit or via Airbus or its subsidiaries and affiliates, in respect of the failure by Spirit, after any applicable grace period, to cure any payment default under (i) the Contract or (ii) *****, or (iii) the Fleet Hour Agreement.”

6.    *****
		
	7.
	Customer Support

		
	7.1
	Customer Support Manager

IAE will assign a V2500-A5 customer support manager for Spirit who will coordinate the business and technical support services needed to support the Engines in Spirit’s fleet.
		
	7.2
	Customer Support Representative

A customer support representative will be assigned to Spirit to assist Spirit on site in preparing for Engine operation.  Such representation will be provided to Spirit at no charge, for a period of three (3) years from entry-into-service of the first Aircraft and thereafter for so long as Spirit operates a minimum of ten (10) Aircraft.  The customer support representative will provide the services described and attributed to the representative in the Product Support Plan attached a Exhibit C to the Contract.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

The customer support representative will be supplied, subject to the condition that Spirit provides the following free-of-charge to the representative in connection with his or her duties:
		
	(a)
	Reasonable office accommodation including access to telephone, fax, and internet; and

		
	(b)
	Access to such first-aid and emergency assistance as in customarily supplied to Spirit’s own employees.

Spirit agrees and acknowledges that the representative shall at all times remain an employee of IAE and shall, in such capacity, be entitled to holiday and vacation period as are granted by IAE to its employees.  However, such leaves shall not interfere with IAE’s provision of the customer support services to Spirit, and should any leave for a customer support representative extend beyond forty-five (45) days, IAE agrees to provide a substitute representative to ensure continuity of service.  Notwithstanding the foregoing, at no time shall any IAE customer support representative be considered an employee or independent contractor of Spirit. The customer support representative will provide on-site technical support for Engines at Spirit’s line stations, upon Spirit’s reasonable request, on an as-required basis to be determined by IAE.  Spirit agrees to provide free of charge airfare from Spirit’s main base to any such line station as well as a reasonable allowance for per diem and hotel expenses.
		
	8.
	Customer Training

		
	8.1
	IAE shall provide, subject to availability, Spirit ***** formal training programs covering courses ***** for a maximum of ***** for qualified Spirit personnel (of which ***** have been used as of the date of this Side Letter No. 1), for a period of ***** from entry-into-service of the first Aircraft, for so long as Spirit operates one or more Aircraft in commercial service.

		
	8.2
	*****

		
	9.
	*****

		
	10.
	Assignment

		
	10.1
	Clause 6.7 of the Contract, Assignment, is deleted in its entirety and replaced with the following:

		
	“6.7.1
	Except as otherwise agreed herein, Spirit may not assign in whole or part any of its rights or obligations under the Contract without the written consent of IAE (such consent not to be unreasonably withheld).  

		
	6.7.2
	*****

		
	6.7.3
	*****

		
	6.7.4
	***** 

		
	6.7.5
	*****

		
	6.7.6
	IAE may, without recourse, assign its rights and/or delegate its obligations under this Agreement to any subsidiary or affiliate of IAE or United 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

 

Exhibit 10.1

Technologies Corporation, or in connection with a merger, consolidation, reorganization, or voluntary sale or transfer of its assets; provided that such assignee/delegate is: (i) solvent at the time of such transfer and (ii) authorized by the applicable regulatory authorities, as necessary, to perform or procure the performance of all obligations being delegated/assigned; and (iii) able, in IAE’s sole, reasonable discretion, to make all payments required by IAE to be made to Spirit under the Contract.”
		
	11.
	Miscellaneous

		
	11.1
	Entire Agreement; Conflicts  

This Side Letter No. 1 and the Contract constitute the sole and entire agreement between Spirit and IAE in relation to the matters set forth herein and shall supersede all previous agreements between Spirit and IAE, both oral and in writing, as of the date hereof. In the event of any conflict between the Contract and this Side Letter No. 1, the terms of this Side Letter No. 1 shall control and the Contract shall be deemed modified accordingly. 
		
	11.2
	Amendment

This Side Letter No. 1 shall not be amended, changed or modified in any way other than by agreement in writing, signed by Spirit and IAE, which is expressly stated to amend this Side Letter No. 1.
		
	11.3
	Proprietary Information

This Side Letter No. 1 shall be subject to the confidentiality and non-disclosure provisions of the Contract.
		
	11.4
	Governing Law

This Side Letter No. 1 shall be subject to the governing provisions of the Contract. 
		
	11.5
	Counterparts

This Side Letter No. 1 may be executed in one or more counterparts, each of which shall be deemed a duplicate original and all of which, when taken together, shall constitute one and the same document.  Execution and delivery of this Side Letter No. 1 by exchange of facsimile copies or electronic mail bearing the signatures of the parties shall constitute a valid and binding execution and delivery of this Side Letter No. 1 by the parties.

Except as expressly amended by this Side Letter No. 1, all provisions of the Contract remain in full force and effect.
	
					
	Agreed to and accepted on behalf of:
IAE International Aero Engines AG
	 
	Agreed to and accepted on behalf of:
Spirit Airlines, Inc.

	By:
	/s/ Rick Deurloo
	 
	By:
	/s/ Charles A. Rue

	Name:
	Rick Deurloo
	 
	Name:
	Charles A. Rue

	Title:
	SVP Sales
	 
	Title:
	VP Supply Chain

	Date:
	10/2/13
	 
	Date:
	10/1/13

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.SAVE-EX10.2-2013.09.30-10Q

Exhibit 10.2

EXECUTION VERSION

V-ServicesSM 
Fleet Hour Agreement

by and between

SPIRIT AIRLINES, INC.

and

IAE INTERNATIONAL AERO ENGINES AG

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

Exhibit 10.2

TABLE OF CONTENTS

1.    Definitions    3
2.    FHA Services    6
3.    Period of Cover    7
4.    Shop Visit Coverage    7
5.    Lease Engine Support    8
6.    Transportation    9
7.    General Fleet Hour Agreement Services    9
8.    Excess Work    10
9.    Obligations of Spirit    12
10.    FHA Rates and Payment    15
11.    Fleet Flexibility    20
12.    Warranties; Limitation of Liability    20
13.    Delays    22
14.    Duplicate Benefits    22
15.    Intellectual Property    22
16.    Amendment    23
17.    Assignment    23
18.    Notices    23
19.    Exclusion of Other Provisions and Previous Understandings    24
20.    Termination, Expiration and Events of Default    24
21.    Negation of Waiver    25
22.    Severability and Partial Invalidity    25
23.    Governing Law    25
24.    Publicity    26
25.    Confidentiality    26
26.    Compliance with All Applicable Laws and Regulations    26
27.    No Construction Against Drafter    27
28.    Damages    27
		
	Exhibit A Aircraft and Spare Engine Delivery Schedules
	28

		
	Exhibit B FHA Escalation Formula
	32

		
	Exhibit C Accessories
	33

		
	Exhibit D V2500 Turbofan Engine Model Specifications
	34

		
	Exhibit E Powerplant Description
	41

		
	Exhibit F Addresses
	43

		
	Exhibit G Engine Monitoring Services
	44

		
	Exhibit H Excess Work Rates
	47

		
	Exhibit I FHA Rate Adjustment Tables
	48

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

FLEET HOUR AGREEMENT
This Fleet Hour Agreement (this “Agreement”) is made this 1st day of October 2013, by and between
	
		
	IAE INTERNATIONAL AERO ENGINES AG
	A joint stock company organized and existing under the laws of Switzerland, with a place of business at 400 Main Street, M/S 121-10, East Hartford, CT 06108 (hereinafter called “IAE”).

	AND
	 

	SPIRIT AIRLINES, INC.
	A corporation organized and existing under the laws of Delaware, with a place of business at 2800 Executive Way, Miramar, Florida 33025 (hereinafter called “Spirit”).

	Each a “Party” and together the “Parties”.

WHEREAS: 
		
	A.
	As of the date hereof, (i) Spirit has acquired, leased or firmly ordered an aggregate of sixty-eight (68) new Airbus A320 family aircraft as described in Exhibit A, all powered by, or to be powered by, V2500-A5 engines, (ii) Spirit has acquired or firmly ordered an aggregate of eleven (11) new V2500-A5 spare engines from IAE all of which are or will be operated by Spirit and (iii) Spirit has the option to purchase a further four (4) new V2500-A5 spare engines from IAE;

		
	B.
	IAE and Spirit have entered into a Fleet Hour Agreement dated April 11, 2005 for the provision of certain off-wing maintenance for the V2500-A5 engines operated by Spirit (the “2005 FHA”);

		
	C.
	Spirit and IAE subsequently signed the V2500 Propulsion System and FHA Proposal dated October 27, 2006, as amended from time to time, which outlines the financial support and support services for Spirit’s incremental order for A320 family aircraft powered by V2500-A5 engines and order for V2500-A5 spare engines (the “2006 Proposal”);

		
	D.
	IAE and Spirit have entered an Amended and Restated V2500® General Terms of Sale dated October 1, 2013, as amended from time to time, including all side letters and amendments thereto, for the provision of V2500-A5 engines, modules, spare parts, tools,  equipment, and product support services for the support and operation of certain V2500-A5 engines (the “Existing Fleet GTA”)

		
	E.
	IAE and Spirit hereby agree to replace in its entirety the 2005 FHA with this Agreement, which shall incorporate the applicable terms and conditions for off-wing maintenance support contained in the 2006 Proposal; and

		
	F.
	IAE and Spirit now wish to agree upon terms whereby IAE shall arrange for, manage and subcontract certain maintenance of the Eligible Engines as defined herein.

NOW THEREFORE IT IS AGREED AS FOLLOWS:
		
	1.
	Definitions

		
	1.1
	“Accessory” or “Accessories” includes those items listed in Exhibit C to this Agreement.

		
	1.2
	 “Airbus” shall mean Airbus SAS.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	1.3
	“Aircraft” shall mean all or each of the: (i) forty (40) A320 family aircraft powered by V2500-A5 engines in-service in Spirit’s fleet as of the date of this Agreement already delivered as described in the schedule set forth in Exhibit Ahereto (the “Existing Aircraft”) and (ii) twenty-eight (28) new Airbus 320 family aircraft powered by V2500-A5 engines to be delivered in accordance with the schedule set forth in Exhibit A hereto, as may be mutually agreed to be amended, supplemented or otherwise modified from time to time (the “Firm Aircraft”).

		
	1.4
	“Aircraft Maintenance Manual” or “AMM” means the aircraft maintenance manual published by Airbus for the Aircraft.

		
	1.5
	“Airworthiness Directive” shall mean any applicable airworthiness directive issued by the Aviation Authority based on certification rules current as of the date of this Agreement.

		
	1.6
	“Aviation Authority” shall mean the FAA.

		
	1.7
	“Beyond Economic Repair” shall mean wear, tear or damage to an item of Eligible Equipment beyond economic repair.

		
	1.8
	“BFE Item” shall mean those items listed as such in Exhibit E of this Agreement.

		
	1.9
	“Business Day(s)” shall mean a day other than a Saturday, Sunday or holiday scheduled by law for commercial banking institutions in the city of New York, New York, United States.

		
	1.10
	“Day” means a calendar day.

		
	1.11
	“EBU Item” shall mean those items listed as such in Exhibit E to this Agreement originally installed on the Eligible Engines or acquired new and dedicated solely for the support of Eligible Engines.

		
	1.12
	“Eligible Engine(s)” shall mean the new Engines originally installed on the Aircraft and the Spare Engines. Exhibit A to this Agreement identifies the Eligible Engines by serial number and will be updated from time to time to: (i) add Eligible Engines and serial numbers as Spirit takes delivery of the Aircraft and the Spare Engines and (ii) to remove Eligible Engines in accordance with Section 11 hereto.

		
	1.13
	“Eligible Engine Flight Cycles” *****.

		
	1.14
	“Eligible Engine Flight Hours” *****. 

		
	1.15
	“Eligible Equipment” shall mean Eligible Engines.

		
	1.16
	“Eligible Removal” shall mean *****.

		
	1.17
	“Engine(s)” shall mean the basic IAE V2500-A5 turbofan engine, described in the V2500 Turbofan Engine Model Specification(s) set forth in Exhibit D of the Agreement, and which excludes Accessories, EBU Items, QEC Items and Nacelle Items.

		
	1.18
	“Engine Manual” shall mean the IAE document which sets forth the requirements for Engine off-wing repair.

		
	1.19
	“Excess Work” shall mean work undertaken by the Maintenance Center during a Shop Visit pursuant to this Agreement, which is further described in Section 8 of this Agreement.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	1.20
	“FAA” shall mean the United States Federal Aviation Administration.

		
	1.21
	“Failure” shall mean *****.

		
	1.22
	“FHA” shall mean this Fleet Hour Agreement.

		
	1.23
	“FHA Administration Manual” means the logistical plan and instructions described in Section 7 of this Agreement.

		
	1.24
	“FHA Manager” shall mean the manager provided by IAE for the support of the operation of this Agreement in accordance with the provisions of Section 7.3 of this Agreement.

		
	1.25
	“FHA Rate(s)” shall mean the rate(s) collectively as set forth in Section 10 below.

		
	1.26
	“Foreign Object Damage” shall mean*****.

		
	1.27
	“Line Maintenance” shall mean any work required to be carried out on an Engine in accordance with the appropriate Aircraft Maintenance Manuals and which can be accomplished either on-wing or off-wing without requiring the induction of such Engine into a Maintenance Center.

		
	1.28
	“Life Limited Parts” or “LLPs” shall mean the Parts identified in Chapter 5 of the V2500-A5 Engine Manual as having specific life limits.

		
	1.29
	“Maintenance Center” shall mean the IAE shareholder maintenance center designated by IAE in consultation with Spirit, from time to time to perform services under this Agreement and which is approved by the Aviation Authority as a certified repair station.  

		
	1.30
	“Maintenance Management Plan”, “MMP” or “eMMP” shall mean the then-current V2500 engine maintenance planning document described in Section 7 of this Agreement.

		
	1.31
	“Miscellaneous Shop Visit” shall mean *****.

		
	1.32
	“Nacelle Items” shall mean those items listed in Exhibit E as “DPP” (demountable power plant) items or “PP” (positionalized power plant) items originally installed on the Eligible Engines or acquired new and dedicated solely for the support of Eligible Engines.

		
	1.33
	“Part(s)” shall mean *****.

		
	1.34
	“Period of Cover” shall mean the period in which IAE agrees to provide the services pursuant to this Agreement, as set out in Section 3 of this Agreement.

		
	1.35
	“QEC Item” shall mean those items listed as such in Exhibit E to this Agreement originally installed on the Eligible Engines or acquired new and dedicated solely for the support of Eligible Engines.

		
	1.36
	“Restoration Shop Visit” or “RSV” shall mean *****. 

		
	1.37
	“Service Bulletin(s)” shall mean those V2500 service bulletins issued by IAE that are designated as “target” service bulletins in the MMP.

		
	1.38
	“Shop Visit” shall mean a Restoration Shop Visit or a Miscellaneous Shop Visit.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	1.39
	“Spare Engine(s)” shall mean all or each of the eleven (11) new V2500-A5 firmly ordered spare Engines either purchased or to be purchased by Spirit from IAE and the four (4) option spare Engines which Spirit has the right to purchase from IAE, already delivered or to be delivered in accordance with the schedule set forth in Exhibit A of this Agreement.

		
	1.40
	“Testable Engine” shall mean *****.

		
	1.41
	“Transportation Coverage” shall mean the services provided to Spirit under Section 6 of this Agreement.

		
	1.42
	“Workscope” shall mean an IAE written repair request to the Maintenance Center(s) compliant with the MMP, approved by Spirit, such approval not to be unreasonably withheld, that authorizes the Maintenance Center(s) to undertake work on Eligible Equipment.

		
	2.
	FHA Services

IAE shall provide to Spirit the following FHA service coverage for the Period of Cover for each Eligible Engine:
		
	2.1
	Engine Shop Visit Coverage in accordance with the terms of Section 4

		
	2.2
	Lease Engine Coverage in accordance with the terms of Section 5.

		
	2.3
	Transportation Coverage in accordance with the terms of Section 6.

		
	2.4
	General FHA Services in accordance with the terms of Section 7.

		
	2.5
	Excess Work as required in accordance with the terms of Section 8.

The provision of such coverage by IAE is subject to Spirit’s fulfillment in all material respects of its obligations under Section 9.
		
	3.
	Period of Cover

This FHA shall become effective on the date of first commercial service of an Eligible Engine and will remain in force and effect for each Eligible Engine through the *****.
		
	4.
	Shop Visit Coverage

Each Eligible Engine following an Eligible Engine Removal shall be forwarded to the Maintenance Center.  IAE shall communicate the Workscope to the Maintenance Center and cause the Maintenance Center to complete the Shop Visit in accordance with such Workscope.  IAE shall pay to the Maintenance Center all charges directly incurred in respect of goods, work and services carried out during the Shop Visit for the following items:
		
	4.1
	*****.

		
	4.2
	IAE will use commercially reasonable efforts to provide the following documentation to Spirit following the release of an Eligible Engine from a Maintenance Center following a Restoration Shop Visit:

		
	4.2.1
	*****; 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	4.2.2
	*****; and

		
	4.2.3
	any Excess Work invoices arising from such Eligible Engine’s Restoration Shop Visit as soon as practicable but no later than *****, if applicable.

		
	4.3
	IAE’s obligations for an Engine Shop Visit caused by Foreign Object Damage shall be limited to the provision of repair work and Parts provided through the Maintenance Center to a maximum of ***** per event *****.

		
	5.
	Lease Engine Support

		
	5.1
	IAE agrees to provide a serviceable lease Engine (in the QEC configuration as defined in the lease Engine technical records which are made available to Spirit at the time of lease Engine offer) for use by Spirit in the event that (i) an Eligible Shop Visit occurs, and (ii) Spirit’s Spare Engines are unavailable due to support of another Eligible Shop Visit and no other Eligible Engines are available for such support.  IAE will identify a lease Engine and use its reasonable endeavors to dispatch such Engine within 24 hours of notification of the requirement, but in any event shall endeavor to dispatch the Engine as soon as possible.  Such Engine(s) will be provided subject to IAE’s standard short term engine lease agreement for V2500 Engines (IATA Master Short Term Lease Agreement, form 5016 00 (“IATA Agreement”)), except that the daily fee for such lease Engine will be waived. Should Spirit require a spare Engine to support a non-Eligible Shop Visit or that does not otherwise meet the above conditions, all terms of the IATA Agreement, including all applicable rates, charges and fees, shall apply.  In the event IAE cannot provide an Engine as set forth herein Spirit shall have the right to lease an Engine from a third party.  In such case, IAE shall reimburse Spirit for the direct and actual reasonable daily lease charges for such Engine lease up to maximum of ***** of the then current applicable IAE daily fee for lease Engines.

		
	5.2
	*****

		
	5.3
	Unless otherwise determined by the FHA manager, acting reasonably, Spirit is to return the IAE lease Engine within ***** after Spirit‘s Engine is returned to Spirit in accordance with Section 6.2 and such Engine is available for installation at Spirit’s facilities.  Also, in the event that Spirit has leased an Engine from a third party as set forth in Section 5.1 above, IAE’s obligation to reimburse Spirit for the direct and actual reasonable cost for such Engine lease shall terminate ***** after Spirit’s Engine is returned to Spirit in accordance with Section 6.2 and such Engine is available for installation at Spirit’s facilities.

		
	6.
	Transportation

		
	6.1
	Spirit shall deliver Eligible Engines to IAE in a Testable Engine configuration and the Accessories related to such Eligible Engines shall be in a serviceable condition.

		
	6.2
	*****

		
	6.3
	*****  

		
	6.4
	*****

		
	6.5
	*****

		
	6.6
	*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	7.
	General Fleet Hour Agreement Services

IAE shall provide the following additional Fleet Hour Agreement services:
		
	7.1
	IAE shall supply Spirit with a V2500-A5 electronic Maintenance Management Plan that shall establish the maintenance requirements including LLP management, incorporation of applicable Service Bulletins and Aviation Authority Airworthiness Directive requirements and Eligible Engine removal planning (“MMP”).  The MMP shall be revised and updated at least once a year, taking into account Spirit’s then-current operation in consultation with Spirit and fleet-wide operational experience, among other considerations.  Additionally, an FHA Administration Manual may be mutually agreed between the parties, which shall establish a logistical plan and instructions for Spirit to facilitate performance by Spirit and IAE under this Agreement.

*****
		
	7.2
	Engine monitoring data program services set forth in Exhibit G; 

		
	7.3
	an FHA Manager based at IAE's offices who shall be the point of contact for Spirit, twenty four (24) hours per day seven (7) days per week, in respect of the services described in this Agreement.  The following responsibilities of IAE shall normally be undertaken by the FHA Manager: 

*****
		
	8.
	Excess Work

		
	8.1
	Any costs incurred by IAE or the Maintenance Center not covered under this Agreement shall be Excess Work and shall be paid for by Spirit in accordance with Section 10.4 of this Agreement.  Excess Work shall include any labor, material and other charges for Eligible Engines that arise from the following: 

*****
		
	8.2
	In the event IAE, following consultation with Spirit, determines that an Eligible Engine requires a Shop Visit that will be considered entirely to be Excess Work, then the IAE FHA Manager shall so notify Spirit and IAE shall perform such work.

		
	8.3
	*****

		
	8.4
	*****

		
	8.5
	*****

		
	9.
	Obligations of Spirit

Spirit agrees to fulfill the following responsibilities and perform the following tasks and to reasonably cooperate with IAE in the performance of IAE’s responsibilities hereunder.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	9.1
	Data and Procedures

Spirit shall at its own expense maintain Eligible Engine electronic condition monitoring capabilities for each Eligible Engine, and with respect to information and data required for the performance of this Agreement, Spirit shall:
		
	9.1.1
	maintain, collect and provide to IAE performance trend monitoring data on each Eligible Engine in accordance with Exhibit G, maintain timely records in form and detail sufficient for the accurate and expeditious administration of the terms of this Agreement including the assessment of operating conditions relative to those set out in Section 10.6 of this Agreement; 

		
	9.1.2
	make available, and provide access to IAE’s provider of electronic condition monitoring data analysis, all data collected in accordance with 9.1.1 above in an electronic format agreed to by IAE, as required for the operation and administration of this Agreement;

		
	9.1.3
	implement and follow the IAE reasonable recommendations resulting from analysis of the performance trend monitoring data;

		
	9.1.4
	within ten (10) Business Days after the end of each month during the Period of Cover, report to IAE, in an electronic format agreed to by IAE, the hours and cycles flown, take off derate, and day temperature for each flight by each Eligible Engine during the preceding month;

		
	9.1.5
	ensure that all data reasonably required by IAE (including borescope reports) to facilitate the correction of any problem causing an Eligible Engine Removal is promptly made available to IAE; 

		
	9.1.6
	provide for each Eligible Engine, no later than two (2) Business Days following Eligible Removal, a removal report containing the following information with respect to the Eligible Engine:

(a)    a record of Eligible Engine total time and cycles; 
(b)    position on the aircraft, aircraft number, and date of Eligible Engine removal; 
(c)    reason for removal, flight and ground indications prior to and related to removal; 
(d)    module rework history with time since new, time since overhaul and time since repair provided such module was serviced outside of this Agreement;
(e)    any borescope reports detailing any open discrepancies; 
(f)    total LLP time, LLP part numbers, serial numbers, cycle limits, time since new, cycles since new, remaining cycles, and take-off bump cycles, if applicable;
(g)    latest build standard record;

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

(h)    records with respect to any Accessories, including part numbers, serial numbers, time and cycles since new, overhaul, Repair, or bench test, and a description of prior work performed for each item unless Spirit directs IAE where to send such Accessories; 
(i)    if applicable, a non-incident certification in customary form that the Eligible Engine and all parts installed thereon: 
(i)    have been operated and maintained in accordance with applicable IAE and Airbus instructions and manuals;
(ii)    have not been operated by any government or military service except as civil aircraft on the civil register; and
(iii)    have not been installed on any engine or module that was subject to any incident, accident, major failure, fire, extreme stress, over temperature outside normal operation, or over-speed; and
(j)    any other data reasonably requested by IAE.
		
	9.1.7
	provide the Engine serial numbers within thirty (30) Business Days of acceptance by Spirit of each applicable Aircraft covered under this Agreement as described in Exhibit A of this Agreement, as amended, supplemented or otherwise modified from time to time; and

		
	9.1.8
	ensure Eligible Engines are available for FHA services in a Testable Engine configuration (when inducted at the Maintenance Center).

		
	9.2
	Engine Preparation for Transportation

For the purposes of the transportation of Eligible Engines as required under this Agreement, Spirit shall:
		
	9.2.1
	make Eligible Engines available for shipment at Spirit’s main base no later than ten (10) days prior to their scheduled induction date; 

		
	9.2.2
	maintain in a serviceable condition one (1) IAE approved transportation stand per spare Eligible Engine plus an additional serviceable IAE approved transportation stand; 

		
	9.2.3
	at the time of an Eligible Engine Removal, remove the Eligible Engine from the Aircraft, mount it on an IAE approved transportation stand and prepare such Eligible Engine for shipment, all in accordance with the procedures specified in the applicable IAE manuals; and

		
	9.2.4
	ensure that it does not remove from the Maintenance Center the IAE approved transportation stand on which the Eligible Engine was transported to the Maintenance Center so that such stand is available at the Maintenance Center on the day such Eligible Engine undergoes testing, to enable efficient movement of such Eligible Engine to the test cell and return transportation of such Eligible Engine to Spirit.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	9.3
	Operation, Maintenance and Troubleshooting of Eligible Equipment

Spirit shall operate, maintain and troubleshoot the Eligible Equipment compliant with the applicable Airbus operating, maintenance and troubleshooting manuals, the then current MMP for Spirit, and to the extent applicable, IAE’s written instructions, including, but not limited to, service information letters, all operator wires and non-modification service bulletins, component maintenance manuals and Airworthiness Directives.  Spirit shall incorporate the relevant provisions of the MMP into its then current airworthiness maintenance program.
		
	9.4
	Administration

		
	9.4.1
	Spirit shall cooperate with IAE to fulfill any reasonable administrative or other requirements of the Maintenance Center, including endorsement of Workscopes for Aviation Authority requirements within three (3) Business Days of receipt from IAE. If Spirit fails to respond, within five (5) Business Days, the Workscope will be deemed to be accepted.

		
	9.4.2
	Spirit shall accomplish quality audits and obtain certifications required by the Aviation Authority and IAE for accomplishment of work on the Eligible Engines at the Maintenance Center(s).

		
	9.5
	One Time Concessions

Spirit shall not unreasonably withhold its approval of any “one time concessions” approved by IAE and the applicable FAA representative with respect to the Eligible Engines.
		
	9.6
	Payment

Spirit shall make payments as required in accordance with Section 10 of this Agreement.
		
	9.7
	Records and Audit

The Parties shall maintain adequate records as required to meet their respective obligations and compliance with the applicable provisions of this FHA.
A Party shall not unreasonably condition or deny the other Party access to such adequate and applicable records for the administration of this Agreement.  Spirit or its nominee may visit the premises of IAE or the Maintenance Center at a time mutually agreeable to the Parties and upon reasonable notice to IAE, for the purpose of quality assurance and to inspect the materials, parts, equipment and tools being used, the work being performed, and to review the quality assurance system in use by IAE and the Maintenance Center.
If IAE or its nominee requires access to the premises of Spirit under this FHA it shall provide reasonable written notice to Spirit and such visit or inspection will be at a time mutually agreeable to the Parties.
Each Party will comply and ensure that its personnel comply with the other Party’s conduct policies, rules, regulations and directions governing the conduct of visitors upon their premises.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	9.8
	Acceptance and Operation

Spirit shall take or, as applicable, have taken delivery of all of the Aircraft and Eligible Engines in accordance with the schedule set forth in Exhibit A to this Agreement, as amended, supplemented or otherwise modified from time to time, and shall operate the Aircraft and Eligible Engines in regular commercial service as contemplated by Section 10.6 below for the duration of the Period of Cover, subject to Section 11 hereto.  
		
	9.9
	Provision of Serviceable Accessories

Spirit shall be responsible for ensuring that each Eligible Engine at the Maintenance Center for a Shop Visit is supported by full suite of serviceable Accessories.  In the event that the repair or replacement of an Accessory for an Eligible Engine delays the completion of the Shop Visit for such Eligible Engine, such delay shall be considered an Excusable Delay.  Alternatively Spirit may request the use of units provided by the Maintenance Center to permit the testing of the Eligible Engine in accordance with Section 8.1.11 above, to the extent the Maintenance Center has such capability.
		
	10.
	FHA Rates and Payment

		
	10.1
	FHA Rates 

		
	10.1.1
	The FHA Rate for Restoration Shop Visit Coverage for Eligible Engines during the Period of Cover shall be as follows:

(a)    For V2524-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour;
(b)    For V2527-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour; and
(c)    For V2533-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour.
		
	10.1.2
	*****

		
	10.1.3
	The FHA Rate for Miscellaneous Shop Visit Coverage for Eligible Engines for the first ***** of each Eligible Engine’s Period of Cover shall be ***** per Eligible Engine Flight Hour.

		
	10.1.4
	The FHA Rate for Miscellaneous Shop Visit Coverage for Eligible Engines each year commencing with the ***** for each Eligible Engine during the Period of Cover shall be as follows:

(a)    For V2524-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour;
(b)    For V2527-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour; and
(c)    For V2533-A5 rated Eligible Engines ***** per Eligible Engine Flight Hour;

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	10.1.5
	*****

		
	10.1.6
	*****

10.1.7*****
		
	10.2
	*****

		
	10.3
	*****

		
	10.4
	Excess Work Invoices

		
	10.4.1
	Charges for Excess Work shall be invoiced to Spirit by IAE as such Excess Work is performed in accordance with rates identified in Exhibit H.

		
	10.4.2
	In the event IAE determines that an Eligible Engine requires a Shop Visit that will be considered entirely to be Excess Work, and the Workscope for such Shop Visit is equal to or greater than a level of work that would be performed at a Restoration Shop Visit, then:

(a)    IAE may invoice Spirit its reasonable estimate of the cost of any Excess Work prior to commencement, or during the execution, of such Excess Work.  IAE shall invoice Spirit for the balance of the cost of any Excess Work upon receipt of the corresponding invoice from the Maintenance Center (or promptly issue a credit to Spirit’s account with IAE for any excess payment received from Spirit); and
(b)    the payment terms as set forth in Section 10.7.1 shall apply. 
		
	10.5
	*****

		
	10.6
	General Conditions

		
	10.6.1
	The FHA Rates are predicated upon Spirit: 

(a)    maintaining within its fleet of Aircraft an annual average flight cycle of: ***** hours for V2524-A5 powered Aircraft, ***** hours for V2527-A5 powered Aircraft, and ***** hours for V2533-A5 powered Aircraft (each calculated from the moment the wheels of an Aircraft, on which any Eligible Engine is installed, leave the ground on take-off to the moment when the wheels of such Aircraft touch the ground on landing);
(b)    maintaining an annual average utilization of ***** hours per V2524-A5 powered Aircraft, ***** hours per V2527-A5 powered Aircraft, and ***** hours per V2533-A5 powered Aircraft;
(c)    maintaining an average engine thrust derate of: ***** for V2524-A5 powered Aircraft, ***** for V2527-A5 powered Aircraft,  and ***** for V2533-A5 powered Aircraft, all relative to the name plate thrust rating; 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

(d)    maintaining an average ambient temperature for take-off no greater than: ***** for V2524-A5 powered Aircraft, ***** for V2527-A5 powered Aircraft, and ***** for V2533-A5 powered Aircraft;
(e)    having its main base located at Fort Lauderdale, Florida, USA;
(f)    Spirit operating each Eligible Engine at its originally installed thrust rating (unless otherwise agreed by the Parties);
(g)    acquiring all of the Firm Aircraft and Firm Spare Engines as set forth in Section 9.8;
(h)    after taking delivery of the Spare Engines in accordance with Exhibit A, maintaining a minimum ratio of ***** Spare Engines to installed Engines for its Aircraft fleet; operating and maintaining the Aircraft and Eligible Engines in accordance with Airbus’, IAE’s, and other applicable OEM’s technical manuals and the eMMP (including Engine rebuild requirements) for the duration of the Period of Cover;
(i)    owning, operating, and maintaining the Aircraft and Eligible Engines in regular commercial airline operation for the duration of the Period of Cover;
(j)    *****; and
(k)    acquiring from IAE or its approved sources reasonably sufficient components, parts, and spare Engines at the levels mutually agreed by IAE and Spirit to maintain proper support of the Eligible Engines and Aircraft.
		
	10.6.2
	In the event Spirit: (i) operates the Eligible Engines contrary to the preceding conditions, or (ii) wishes to include additional aircraft powered by V2500-A5 engines or additional V2500-A5 spare engines under this Agreement, then IAE, acting in good faith and in consultation with Spirit, may make reasonable and appropriate adjustments to the FHA Rates in accordance with the FHA Rate adjustment matrices set forth in Exhibit I (the “FHA Rate Adjustment Matrices”), which detail the effects of variations in derate, stage length, annual average utilization, and temperature on such FHA Rates.  The FHA Rate Adjustment Matrices will be applied on an engine-by-engine basis at RSV induction.  

		
	10.6.3
	In the event that an Eligible Engine leaves this Agreement for reasons beyond the control of Spirit, for example, an Eligible Engine is deemed damaged Beyond Economic Repair and is replaced by Spirit with another Engine, subject to prior written agreement by IAE (not to be unreasonably withheld, conditioned or delayed), the FHA Rates for that Engine and not for all Eligible Engines, will be adjusted.   

		
	10.7
	Payment

		
	10.7.1
	*****   

		
	10.7.2
	Subject to Section 10.7.1 above, Spirit shall pay all invoices submitted by IAE under this Section 10 within ***** of receipt by Spirit.  

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	10.7.3
	Spirit undertakes that IAE shall receive the full undisputed amount of payments falling due under this Section 10, without any withholding or deduction whatsoever. If Spirit has a reasonable, good faith dispute with an Excess Work charge from IAE, Spirit will promptly notify IAE of such dispute in writing detailing the grounds for such dispute, but not later than fifteen (15) Business Days after receipt of such Excess Work charge. The Parties agree to use their reasonable, diligent and good faith efforts to reach a mutually agreeable resolution to such dispute.. The Parties agree to use their reasonable, diligent and good faith efforts to reach a final resolution of the disputed Excess Work charge including, if necessary, elevation of the issue to each Party’s senior management.

		
	10.7.4
	All payments under this Section 10 shall be made by electronic transfer and shall be deposited not later than the due date of payment with:

*****
or to such other account in the United States as IAE may from time to time designate in writing, which designation shall be effective upon receipt by Spirit of such notice.
		
	10.7.5
	Should Spirit fail to make any material payments to IAE required as set forth in this Section 10 or should Spirit fail to make any material payments to IAE when due under any other agreement between IAE and Spirit and such amount is not subject to a good faith dispute between the Parties, then, notwithstanding any rights which IAE may have in contract or in law, IAE reserves the right to (a) assess interest on such late payment at the rate of the greater of ***** or the New York Citibank prime rate plus ***** per annum from the date the payment was due to be made until the date such payment is received by IAE, (b) suspend all work on any and all Eligible Engines then currently at the Maintenance Center pursuant to this FHA and/or (c) hold Eligible Engines in IAE’s possession or control. 

		
	10.8
	Taxes and Other Like Charges

		
	10.8.1
	In addition to amounts stated to be payable by Spirit pursuant to this Agreement, Spirit shall pay any and all imposts, taxes, duties, levies, fees, assessments or other like charges (excluding any income, gains, or excess profit, franchise and similar taxes levied on the part of IAE, any Maintenance Center or their respective Affiliates and subcontractors,) which may be imposed by any government or taxing agency thereof arising from performance by IAE or its subcontractors in connection with this Agreement.

		
	10.8.2
	All amounts stated to be payable by Spirit pursuant to this Agreement exclude any value added tax, sales tax or similar such tax.  In the event that the supply of goods or services under this Agreement is chargeable to any value added tax, sales tax or similar such tax will be borne by Spirit, subject to the receipt of any appropriate documentation that may be required to enable or assist Spirit to claim or verify any tax credit, set off, rebate or refund in respect of such taxes paid or payable in connection with supplies under this Agreement.  

		
	10.8.3
	If either IAE or Spirit becomes aware of any taxes set forth in Sections 10.8.1 and 10.8.2 above, the relevant Party shall promptly notify the other Party, and both parties agree to consult in good faith and take such other reasonable steps in order to mitigate the tax in question.  

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	11.
	*****

		
	12.
	Warranties; Limitation of Liability

		
	12.1
	IAE warrants the work performed by a Maintenance Center at the final Shop Visit for each Eligible Engine under this Agreement shall be free from defects in materials and workmanship as follows: If Spirit demonstrates to the reasonable satisfaction of IAE that a defect in the work performed on a Part has caused damage to such Part or any other Part, and Spirit provides written notice to IAE of such damage within ***** or within ***** after installation of the corresponding Eligible Engine on an Aircraft, or if not installed on an Aircraft, within ***** after delivery of the Eligible Engine from the applicable Shop Visit, whichever occurs first, IAE shall, as its sole responsibility for such defect, repair such damage at IAE’s own cost and expense.  Transportation charges for the return of defectively serviced goods to IAE or the Maintenance Center, and their reshipment to Spirit and risk of loss thereof shall be borne by IAE only if such goods are returned in accordance with reasonable written shipping instructions from IAE.  

		
	12.2
	IAE warrants to Spirit that it shall convey good title to the new Parts sold hereunder.  IAE's liability and Spirit’s remedy under this warranty are limited to the removal of any title defect or, at the election of IAE, to the replacement of the new Parts or components thereof which are defective in title; provided, however, that the rights and remedies of the Parties with respect to patent infringement shall be limited to the provisions of Section 15 of this Agreement. 

Spirit warrants that title to Parts removed from Eligible Engines by the Maintenance Center shall pass immediately to IAE free and clear of all security interests and rights of Spirit or others at the time that title to the replacement Part passes to Spirit.
		
	12.3
	THE FOREGOING WARRANTIES TOGETHER WITH THE EXPRESS REMEDIES PROVIDED TO SPIRIT IN ACCORDANCE WITH THIS AGREEMENT, ARE EXCLUSIVE AND ARE GIVEN BY IAE IN LIEU OF (A) ANY AND ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE; AND (B) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM, OR REMEDY IN STATUTE, CONTRACT, TORT OR STRICT LIABILITY AGAINST OEM OR ITS AFFILIATES, WHETHER OR NOT ARISING FROM THE NEGLIGENCE, ACTUAL OR IMPUTED (BUT NOT GROSS NEGLIGENCE OR WILLFUL MISCONDUCT), OF IAE OR ITS AFFILIATES, STOCKHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, PERMITTED ASSIGNS AND AGENTS.

		
	12.4
	*****

		
	12.5
	For purpose of this Section 12, “IAE” shall be deemed to include IAE International Aero Engines AG, Pratt and Whitney, a division of United Technologies Corporation, Pratt & Whitney Aero Engines International GmbH, Japanese Aero Engine Corporation, MTU Aero Engines GmbH, and the respective directors, officers, employees and agents of each.

		
	13.
	Delays

		
	13.1
	Excusable Delays

IAE shall not be charged with any liability for delay in the performance of any of its obligations when such delay is caused by acts of God or the public enemy, compliance in good faith with any applicable foreign or domestic governmental regulation or order whether or not it 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

proves to be invalid, fires, riots, labor disputes, unusually severe weather, or any cause beyond the reasonable control of IAE, or by delays of IAE’s suppliers for any of the same or similar causes.  To the extent that such causes actually delay performance on the part of IAE, the time for the performance shall be extended for as many days as are required to obtain removal of such causes. This provision shall not, however, relieve IAE from using its reasonable efforts to avoid or remove such causes and continue performance with reasonable dispatch whenever such causes are removed (“Excusable Delay”).
If Spirit fails to comply with the requirements set forth in Section 9, and such failure or non-approval, as applicable causes the Maintenance Center to reasonably reschedule or delay the induction or completion of a Shop Visit for an Eligible Engine, then such delay shall constitute an Excusable Delay for IAE.
		
	14.
	Duplicate Benefits

Spirit and IAE agree that it is not the intention to provide duplicate benefits under the terms of this Agreement and the Existing Fleet GTA or under any other arrangement between IAE or IAE’s suppliers or Airbus and Spirit. In the event of any such duplication of benefits, Spirit may, at the relevant time in respect of the relevant circumstances receive any one such benefit (at Spirit’s discretion) to the exclusion of all other duplicate benefits.
		
	15.
	Intellectual Property 

		
	15.1
	IAE shall conduct, at its own expense, the entire defense of any claim, suit or action alleging that, without further combination, the use or resale by Spirit or any subsequent purchaser or user of the Parts delivered hereunder directly infringes any United States patent or any patent of any other country that is a signatory to Article 27 of the Convention of International Aviation signed by the United States at Chicago on December 7, 1944, in which Spirit is authorized to operate, but only on the condition that:

		
	15.1.1
	IAE receives prompt written notice of such claim, suit or action and has full opportunity and authority to assume the sole defense thereof, including settlement and appeals, and all information available to Spirit or subsequent purchaser or user for such defense; provided, however, IAE shall not agree to any settlement pursuant to which any fault is attributed to Spirit, without the prior written consent of Spirit;

		
	15.1.2
	such new Parts are made according to a specification or design furnished by IAE or, if a process patent is involved, the process performed with such Parts if recommended in writing by IAE; and

		
	15.1.3
	the claim, suit or action is brought against Spirit.

		
	15.2
	Provided all of the foregoing conditions have been met, IAE shall, at its own expense, either settle said claim, suit or action or shall pay all damages, excluding consequential damages and costs awarded by the court thereon, and, if the use or resale of such new Parts is finally enjoined, IAE shall, at IAE’s option:

		
	15.2.1
	procure for Spirit the right to use and resell the new Parts,

		
	15.2.2
	replace them with equivalent non-infringing Parts, 

		
	15.2.3
	modify them so they become non-infringing but equivalent, or 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	15.2.4
	remove them and refund the purchase price and any additional amount necessary to replace the same with equivalent, non-infringing Parts (less a reasonable allowance for use, damage and obsolescence).

		
	15.3
	If a claim, suit or action is based on a design or specification furnished by Spirit or on the performance of a process not recommended or approved in writing by IAE, or on the use or sale of the Parts delivered hereunder in combination with other new parts not delivered to Spirit by IAE, Spirit shall indemnify and save IAE harmless therefrom.

		
	16.
	Amendment

This Agreement shall not be amended, changed, or modified in any way other than by agreement in writing, signed by the Parties hereto after the date of this Agreement, which is expressly stated to amend this Agreement.
		
	17.
	Assignment

		
	17.1
	Except as other agreed herein, Spirit may not assign in whole or part any of its rights or obligations under this Agreement without the written consent of IAE (such consent not to be unreasonably withheld).  

		
	17.2
	*****

		
	17.3
	*****

		
	17.4
	IAE may, without recourse, assign its rights and/or delegate its obligations under this Agreement to any subsidiary or affiliate of IAE or United Technologies Corporation, or in connection with a merger, consolidation, reorganization, or voluntary sale or transfer of its assets; provided that such assignee/delegate is: (i) solvent at the time of such transfer and (ii) authorized by the applicable regulatory authorities, as necessary, to perform or procure the performance of all obligations being delegated/assigned; and (iii) able, in IAE’s sole, reasonable discretion, to make all payments required by IAE to be made to Spirit under this Agreement.

		
	18.
	Notices

Any notice to be served pursuant to this Agreement shall be sent by registered mail, by internationally recognized overnight courier, or by facsimile (with the original notice sent by registered mail or internationally recognized overnight courier) to the applicable address indicated in Exhibit F.
		
	19.
	Exclusion of Other Provisions and Previous Understandings

		
	19.1
	This Agreement is the sole and entire agreement of the Parties with respect to the Eligible Engines and the subject matter hereof and shall apply to the exclusion of any other provisions on or attached to or otherwise forming part of any order form of Spirit, or any acknowledgment or acceptance by IAE, or of any other document which may be issued by either Party relating to such services and the Eligible Engines.

		
	19.2
	The Parties agree that neither of them have placed any reliance whatsoever on any representations, agreements, statements or understandings made prior to the signature of this Agreement, whether orally or in writing, relating to such services, other than those expressly incorporated in this Agreement, which has been negotiated on the basis that its 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

provisions represent their entire agreement relating to such services and shall supersede all such representations, agreements, statements and understandings.
		
	20.
	Termination, Expiration and Events of Default

		
	20.1
	Bankruptcy Insolvency 

Either Party shall have the option, at its sole discretion, to terminate this Agreement upon the occurrence of any of the following events: (a) a receiver or trustee is appointed for any of the other Party’s property, or (b) the other Party is adjudicated or voluntarily becomes bankrupt under any bankruptcy or winding up laws or other similar legislation, or (c) the other Party becomes insolvent or makes an assignment for the benefit of creditors.
		
	20.2
	Failure to Make Payments or to Meet Obligations

		
	20.2.1
	If Spirit fails to make any payment of a material amount, due and owing to IAE as set forth in Section 10 of this Agreement or any other agreement between the Parties (including any late interest due thereon) and such amount is not the subject of a good faith dispute or fails to meet any other material obligation under this Agreement or any other agreement between the Parties, then, after notice to Spirit and the expiration of a ***** cure period, and without prejudice to any of IAE’s other rights which IAE may have in contract, at law, or in equity, IAE shall have the right to not to induct, to suspend all work on, or not to release from the Maintenance Center(s) any Eligible Engine until full payment is made by Spirit to IAE or such failure is corrected, as the case may be.

		
	20.2.2
	If Spirit fails to take delivery of all of the Aircraft and Eligible Engines in accordance with the schedule set forth in Exhibit A to this Agreement, as amended, supplemented or otherwise modified from time to time, or fails to operate the Aircraft and Eligible Engines in regular commercial service as contemplated by Section 10.6 for the duration of the Period of Cover, in addition to any other rights which IAE may have in contract, at law, or in equity, IAE shall be entitled to make reasonable adjustments to the FHA Rates as appropriate based on the method of calculation used to derive the FHA Rates.  

		
	20.2.3
	A non-defaulting Party shall have the right to declare an event of default and terminate this Agreement: (i) if any default shall occur in the payment by the defaulting party of any material amount hereunder when and as the same becomes due and payable and such default continues, after notice from the non-defaulting Party for a period of ***** or more and  is not the subject of a good faith dispute between the Parties, or (ii) for a failure by the defaulting Party to meet any other material obligation under this Agreement, and such failure has not been fully corrected within ***** after the non-defaulting Party has given notice of such failure to the defaulting Party and is not the subject of a good faith dispute between the Parties.

		
	20.3
	Expiration

This Agreement shall be effective from the day and year first before written until the end of the Period of Cover or until terminated pursuant to this Section 20. Notwithstanding the foregoing, Sections 20.4, 23, and 26 of this Agreement shall survive any expiration or termination of this Agreement.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

		
	20.4
	Effect of Termination or Expiration

Except as otherwise set out in this Section 20.4 and any rights or obligations arising under the applicable law, the rights and obligations of the Parties under this Agreement shall terminate upon the termination or expiration of this Agreement, and Spirit shall no longer be provided with fleet hour agreement coverage under the terms of this Agreement.
		
	20.4.1
	Upon any termination or expiration of this Agreement, all liabilities and obligations (including payment obligations) that have accrued prior to such termination or expiration (including payment due for Excess Work) shall survive.

		
	20.4.2
	Spirit shall pay to IAE the cost of any and all services which have been or are in the process of being carried out under the terms of this Agreement which have not been covered by payments made by Spirit under this Agreement plus a surcharge of the lesser of (i) ***** and (ii) the maximum amount allowed by law.  Should Spirit terminate this Agreement under Section 20.1 or Section 20.2.3 above, IAE shall return any excess payments for services paid for, but not rendered.  Such calculation shall be performed by IAE within sixty (60) Business Days of termination, shall be mutually approved by IAE and Spirit and shall be immediately due and payable by Spirit or IAE, as the case may be, upon receipt thereof.

		
	21.
	Negation of Waiver

Failure by either Party to enforce any term of this Agreement shall not constitute a waiver of such term.
		
	22.
	Severability and Partial Invalidity

If any provision of this Agreement or the application thereof to either Party shall be invalid, illegal or unenforceable to any extent, the remainder of the Agreement and the application thereof shall not be affected and shall be enforceable to the fullest extent permitted by law.
		
	23.
	Governing Law

This Agreement shall be construed and the performance thereof determined in accordance with the laws of *****.
*****
		
	24.
	Publicity

Each Party agrees that it shall not issue any press release or make any public announcement regarding this Agreement without the written consent of the other Party.  Spirit agrees that IAE may use Spirit’s authorized logo, service marks and trademarks for the purpose of confirming that Spirit is a customer of IAE.  IAE agrees that Spirit may use IAE’s authorized logo, service marks and trademarks for the purpose of confirming that IAE is a supplier to Spirit. Except as expressly set forth above, neither Party may use the other Party’s logo, service marks and trademarks without the express written consent of the other Party.
		
	25.
	Confidentiality

Each of IAE and Spirit acknowledge and understand that certain commercial and financial information contained in or provided in connection with this Agreement is considered by the other to be 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

confidential. IAE and the Spirit each hereby agree, for the benefit of the other, that it shall treat the contents of this Agreement as confidential and shall not, without the prior written consent of the other, disclose or cause to be disclosed the terms hereof to any person except: (i) to its legal and financial advisors and auditors who are bound by written obligation of confidentiality, or (ii) as may be required by applicable law or governmental regulation, including federal and state securities laws, or pursuant to an order issued by any court or governmental authority having jurisdiction over Spirit or IAE as the case may be, provided that the Party being required to disclose shall, to the extent permitted by Applicable Law,  give prior notice to the other Party in order that it may have every reasonable opportunity to contest such disclosure, and provided further that the Party being required to disclose shall use commercially reasonable efforts to assist the other to resist or narrow the required disclosure to the extent possible while still complying with such requirement.
Notwithstanding the foregoing, IAE shall be entitled to disclose the relevant terms of this Agreement on a need-to-know basis to the Maintenance Centers, provided that they are bound by similar confidentiality obligations and Spirit shall be entitled to disclose the terms of the same to its officers, directors, employees who have a need-to-know of such terms of this Agreement.
		
	26.
	Compliance with All Applicable Laws and Regulations

		
	26.1
	Export/Import. Spirit agrees that it will not, directly or indirectly, sell, export, re-export, transfer, divert, or otherwise dispose of any IAE goods, software, technical data (including products derived from or based on such technical data), or services received directly or indirectly from IAE to any Prohibited Party without obtaining prior authorization from the relevant government authorities as required pursuant to Export Laws.

“Prohibited Parties” means, collectively, those countries, and persons  to whom the sale, export, re-export, transfer, diversion or other disposition of any IAE goods, software, technical data or services is prohibited by the applicable export laws and related regulations of  the United States, German, British, Japanese, or European Union Governments.
		
	26.2
	Other Laws and Regulations.  Spirit agrees that it will abide by all applicable laws and regulations.

		
	26.3
	Spirit shall indicate its compliance with the above on or before execution of this Agreement by completing and signing the End Use/End User Certificate form provided by IAE.

		
	27.
	No Construction Against Drafter

This Agreement has been the subject of detailed negotiation between the Parties.  If an ambiguity or question of the intent arises with respect to any provision of this Agreement, this Agreement will be construed as if drafted jointly by IAE and Spirit and no presumption or burden of proof will arise favoring or disfavoring either Party by virtue authorship of any of the provisions of this Agreement.
		
	28.
	Damages

In no event shall either Party to this Agreement or either Party’s subsidiaries or affiliates, have any liability to any other Party hereto for any indirect, incidental, special, consequential, or punitive damages, including without limitation any damage to or loss of use, revenue or profit with respect to any Aircraft, Engines and/or Parts.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

IN WITNESS WHEREOF the Parties hereto have caused this Agreement to be signed on their behalf by their authorized officers the day and year first before written: 
	
					
	Agreed to and accepted on behalf of:
IAE International Aero Engines AG
	 
	Agreed to and accepted on behalf of:
Spirit Airlines, Inc.

	By:
	/s/ Rick Deurloo
	 
	By:
	/s/ Charles A. Rue

	Name:
	Rick Deurloo
	 
	Name:
	Charles A. Rue

	Title:
	SVP Sales
	 
	Title:
	VP Supply Chain

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

        Exhibit A     
Aircraft and Spare Engine Delivery Schedules 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

Exhibit A-1
Existing Aircraft 

	
							
	Existing Aircraft No.
	Aircraft Type
	Engine Model
	Delivery Date
	Aircraft MSN
	ESN 1
	ESN 2

	1
	*****
	*****
	*****
	*****
	*****
	*****

	2
	*****
	*****
	*****
	*****
	*****
	*****

	3
	*****
	*****
	*****
	*****
	*****
	*****

	4
	*****
	*****
	*****
	*****
	*****
	*****

	5
	*****
	*****
	*****
	*****
	*****
	*****

	6
	*****
	*****
	*****
	*****
	*****
	*****

	7
	*****
	*****
	*****
	*****
	*****
	*****

	8
	*****
	*****
	*****
	*****
	*****
	*****

	9
	*****
	*****
	*****
	*****
	*****
	*****

	10
	*****
	*****
	*****
	*****
	*****
	*****

	11
	*****
	*****
	*****
	*****
	*****
	*****

	12
	*****
	*****
	*****
	*****
	*****
	*****

	13
	*****
	*****
	*****
	*****
	*****
	*****

	14
	*****
	*****
	*****
	*****
	*****
	*****

	15
	*****
	*****
	*****
	*****
	*****
	*****

	16
	*****
	*****
	*****
	*****
	*****
	*****

	17
	*****
	*****
	*****
	*****
	*****
	*****

	18
	*****
	*****
	*****
	*****
	*****
	*****

	19
	*****
	*****
	*****
	*****
	*****
	*****

	20
	*****
	*****
	*****
	*****
	*****
	*****

	21
	*****
	*****
	*****
	*****
	*****
	*****

	22
	*****
	*****
	*****
	*****
	*****
	*****

	23
	*****
	*****
	*****
	*****
	*****
	*****

	24
	*****
	*****
	*****
	*****
	*****
	*****

	25
	*****
	*****
	*****
	*****
	*****
	*****

	26
	*****
	*****
	*****
	*****
	*****
	*****

	27
	*****
	*****
	*****
	*****
	*****
	*****

	28
	*****
	*****
	*****
	*****
	*****
	*****

	29
	*****
	*****
	*****
	*****
	*****
	*****

	30
	*****
	*****
	*****
	*****
	*****
	*****

	31
	*****
	*****
	*****
	*****
	*****
	*****

	32
	*****
	*****
	*****
	*****
	*****
	*****

	33
	*****
	*****
	*****
	*****
	*****
	*****

	34
	*****
	*****
	*****
	*****
	*****
	*****

	35
	*****
	*****
	*****
	*****
	*****
	*****

	36
	*****
	*****
	*****
	*****
	*****
	*****

	37
	*****
	*****
	*****
	*****
	*****
	*****

	38
	*****
	*****
	*****
	*****
	*****
	*****

	39
	*****
	*****
	*****
	*****
	*****
	*****

	40
	*****
	*****
	*****
	*****
	*****
	*****

	41
	*****
	*****
	*****
	*****
	*****
	*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

	
							
	42
	*****
	*****
	*****
	*****
	*****
	*****

	43
	*****
	*****
	*****
	*****
	*****
	*****

	44
	*****
	*****
	*****
	*****
	*****
	*****

	45
	*****
	*****
	*****
	*****
	*****
	*****

	46
	*****
	*****
	*****
	*****
	*****
	*****

	47
	*****
	*****
	*****
	*****
	*****
	*****

 
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

Exhibit A-2
Firm Aircraft

	
							
	Existing Aircraft No.
	Aircraft Type
	Engine Model
	Delivery Date
	Aircraft MSN
	ESN 1
	ESN 2

	1
	*****
	*****
	*****
	*****
	*****
	*****

	2
	*****
	*****
	*****
	*****
	*****
	*****

	3
	*****
	*****
	*****
	*****
	*****
	*****

	4
	*****
	*****
	*****
	*****
	*****
	*****

	5
	*****
	*****
	*****
	*****
	*****
	*****

	6
	*****
	*****
	*****
	*****
	*****
	*****

	7
	*****
	*****
	*****
	*****
	*****
	*****

	8
	*****
	*****
	*****
	*****
	*****
	*****

	9
	*****
	*****
	*****
	*****
	*****
	*****

	10
	*****
	*****
	*****
	*****
	*****
	*****

	11
	*****
	*****
	*****
	*****
	*****
	*****

	12
	*****
	*****
	*****
	*****
	*****
	*****

	13
	*****
	*****
	*****
	*****
	*****
	*****

	14
	*****
	*****
	*****
	*****
	*****
	*****

	15
	*****
	*****
	*****
	*****
	*****
	*****

	16
	*****
	*****
	*****
	*****
	*****
	*****

	17
	*****
	*****
	*****
	*****
	*****
	*****

	18
	*****
	*****
	*****
	*****
	*****
	*****

	19
	*****
	*****
	*****
	*****
	*****
	*****

	20
	*****
	*****
	*****
	*****
	*****
	*****

	21
	*****
	*****
	*****
	*****
	*****
	*****

*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

Exhibit A-3
Spare Engines

	
					
	Spare Engines
	No.
	Engine Model
	Delivery Date
	ESN

	Firm Spare Engines
	1
	*****
	*****
	*****

	2
	*****
	*****
	*****

	3
	*****
	*****
	*****

	4
	*****
	*****
	*****

	5
	*****
	*****
	*****

	6
	*****
	*****
	*****

	7
	*****
	*****
	*****

	8
	*****
	*****
	*****

	9
	*****
	*****
	*****

	10
	*****
	*****
	*****

	11
	*****
	*****
	*****

	 
	 
	 
	 
	 

	Option Spare Engines
	1
	*****
	*****
	*****

	2
	*****
	*****
	*****

	3
	*****
	*****
	*****

	4
	*****
	*****
	*****

*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit B     
FHA Escalation Formula 
1.    FHA Rates will be subject to annual escalation in accordance with the formula set forth below:
***** 
Where:
FHA Rates are the applicable base values at the Base Month as set forth in the Contract;
“Base Month” shall mean the base month and year specified for the FHA rates in the Contract;
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit C     
Accessories 	
				
	ATA code
	Description
	Units Per Engine
	OEM

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit D     
V2500 Turbofan Engine Model Specifications  
 
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit E     
Powerplant Description 
	
				
	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

	
				
	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

	***** 
	***** 
	***** 
	***** 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit F     
Addresses
1.    SPIRIT ADDRESSES
(a)    Address for Notices:
Legal Department
Spirit Airlines, Inc.
2800 Executive Way
Miramar, Florida  33025
Fax: (954) 447-7854
(b)    Address for Invoices:
Accounts Payable Department
Spirit Airlines, Inc.
2800 Executive Way
Miramar, Florida  33025
Fax: (954) 447-7855
2.    IAE ADDRESSES
(a)    Address for Notices:
Attention:  Chief Legal Officer & Company Secretary
IAE International Aero Engines AG
400 Main Street, M/S 121-10
East Hartford, CT 06108
Fax: (860) 565-4003
(b)    Address for Invoices:
Attention:  Accounts Receivable Manager
IAE International Aero Engines AG
400 Main Street, M/S 121-10
East Hartford, CT 06108
Fax: (860) XXX-XXXX
(c)    Address for all Other FHA Matters:
Attention:  Customer Fleet Director for Spirit
IAE International Aero Engines AG
400 Main Street, M/S 121-10
East Hartford, CT 06108
Fax: (860) XXX-XXXX

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit G     
Engine Monitoring Services 
1.    IAE will provide the following Engine health monitoring services (“Services”) through the ADEM system:
(a)    ENGINE TREND MONITORING
		
	(i)
	Provide processing of in-flight engine data received from Operator into IAE’s EHM database as provided per the data input and transmission requirements set forth in Section 3 herein.  All processed data will be provided to the Operator via IAE’s web portal. Daily updates require web portal access described in Section 1(b) herein.

		
	(ii)
	Provide automated mechanical exceedance reporting for those Aircraft that are equipped with required on-board hardware and software.

		
	(iii)
	Provide technical analysis of EHM Eligible Engines’ performance data and report anomalies indicated by such data to designated Operator personnel as required.

		
	(iv)
	Provide access to monthly EHM Eligible Engine operating trend analysis report covering post EHM Commencement Date operations to assist Operator in the planning and scheduling of EHM Eligible Engines for shop visits.

		
	(v)
	Provide automated alert notification of parameters that have exceeded level and rate change limits.

		
	(vi)
	Provide access to alert details reports that identify Aircraft and Eligible Engines by serial number and provide the date, time, magnitude and details of occurrences when such Eligible Engine exceeds specific performance parameters and provide the ability to store comments associated with a given alert.

		
	(vii)
	Provide exhaust gas temperature (subject to data availability) Watch-Lists, updated monthly utilizing data received from Operator to assist Operator in scheduling Eligible Engine removals for maintenance purposes.  The Watch-Lists provide an engine ranking and predicted removal date for a given Eligible Engine based on the measured parameter and deterioration rate to assist with proactive on-wing management and maintenance planning.

		
	(viii)
	Provide access to the following engine performance parameter trend plots that are updated real-time as new in-flight engine data is received from Operator:

•EGT Margin
•Sea Level Outside Air Temperature Limits
•N1 and N2 Shaft Speeds
•Fuel Flow
•Vibration
•Oil Temperature

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

•Oil Pressure
•P2.5, T2.5, P3.0, T3.0, P12.5

		
	(ix)
	Upon special request, raw in-flight engine data can be supplied to the Operator.

		
	(x)
	Input data files and d individually processed records will be stored for a minimum period of five (5) years. 

(b)    WEB PORTAL ACCESS
		
	(i)
	Provide twenty-four (24) hour per day access to reports and processed information, provided to under Section 1 herein, through a secure web portal created and maintained by IAE.  Such web portal access shall be created and provided to Operator approximately thirty (30) days from the execution of this Agreement. Operator must meet IAE defined requirements for access as detailed in Section 2 herein. IAE will use all reasonable efforts to ensure a service availability target of 96% when measured on an annual basis and that down time of the system is no longer than one (1) business day for any one incident. 

		
	(ii)
	IAE shall provide Services under the terms of this Agreement contingent upon the timely receipt of data required by IAE from Operator.  It is understood between the parties that the ability of IAE to provide timely and accurate reports and processed information through these web-based services is dependent upon the quality and timeliness of the data received from Operator.

		
	(iii)
	If Email, or pager or cell phone alert notifications are required by the Operator, the Operator shall be responsible for acquiring and maintaining the required pager and cell phone hardware and software and pay any associated communications fees.  It is the Operator’s responsibility to establish an alert notification contact list and advise IAE of any changes.

2.    ACCESSIBILITY
(a)    To facilitate internet portal access, Operator is required to maintain the following: (i) internet access; (ii) Internet Explorer version 5.5 or higher; (iii) 128 bit Secure Socket Layer (“SSL”) encryption capability; and (iv) a minimum internet speed of 56K bits per second to access the internet portal.
(b)    All information being transmitted through the Internet portal will be protected using SSL encryption.  In addition, each user of the Internet portal will be authenticated at logon with a unique user identification and password.  Once authenticated to the Internet portal, Operator will only be allowed to access the information that Operator and IAE mutually agree a specific user may review.  IAE shall review security requirements for web portal access from time to time to ensure an appropriate level of data protection.  Updated security requirements shall be communicated to Operator on a timely basis.
3.    TRANSMISSION OF DATA BY OPERATOR
(a) Operator shall provide all data requested by IAE in order to perform the Services, including but not limited to the date and time the data was recorded, aircraft and engine 

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

number, engine position, altitude and mach (or air speed), total air temperature, engine pressure ratio, rotor speeds, fuel flow, oil temperature, oil pressure, mechanical exceedances and pertinent maintenance actions (EHM Eligible Engine changes, sensor changes, other items that may impact engine performance).  Operator shall electronically transmit engine condition monitoring data to IAE’s designated ground station via air-to-ground service providers (e.g., ARINC and SITA) or via such other routing as the parties mutually agree.
(b) Using the facilities available within IAE’s V2500 engine monitoring program services, the Operator shall provide feedback of on-wing maintenance actions taken as a result of an alert notification as provided in accordance with Section 1(a)(v) herein.
4.    LIMITATION OF LIABILITY
IAE MAKES NO WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICES SET FORTH IN THIS Exhibit G.  OPERATOR ACKNOWLEDGES AND AGREES THAT IT IS SOLELY RESPONSIBLE FOR MAKING ALL DECISIONS IN RESPECT TO THE SERVICES.  IAE EXPRESSLY DISCLAIMS AND OPERATOR HEREBY RELEASES IAE FROM ANY LIABILITY, INCLUDING BUT NOT LIMITED TO LIABILITY FOR DIRECT, INDIRECT, CONSEQUENTIAL, OR INCIDENTAL DAMAGES ARISING OUT OF OR ASSOCIATED WITH THE SERVICES, RECOMMENDATIONS OR FAILURE TO MAKE RECOMMENDATIONS BY IAE, OR ANY DECISIONS MADE BY OPERATOR WITH RESPECT TO THE SERVICES.  Should Operator fail to comply with operating and maintenance instructions or recommendations resulting from the Services, authorized or issued by IAE and current at the time, then IAE shall not be held liable for any costs associated with any Engine, Module or Part failure arising from Operator’s failure to comply with IAE’s recommendations.  Any such event shall also be considered ineligible against any warranties or guarantees provided by IAE and resulting repairs and part replacements shall be carried out and charged as Excess Work under the applicable IAE Fleet Hour Agreement.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit H     
Excess Work Rates 
	
			
	Item
	Basis
	Rates/Fees

	*****
	*****
	*****(4)

	*****
	*****
	*****

	*****
	*****(1)
	*****(2)

	*****
	*****
	*****

	*****
	*****
	*****

	*****
	*****
	*****

	*****
	***** (3)
	*****(4)

	*****
	*****
	*****(4)

Notes:
1.    ***** 
2.    *****
3.    Where units per Engine quantities listed in Exhibit C are greater than *****, a single ***** fee per ATA line item shall still apply.  This charge will also cover the packing, one-way transportation and coordination of Accessories removed and sent for vendor repair.
4.    The above rates and fees are expressed in United States Dollars and are subject to escalation from the base month of January 2012 in accordance with the formula set forth in Exhibit B.

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

          Exhibit I     
FHA Rate Adjustment Tables 
The FHA Rates have been calculated based on Spirit meeting the General Conditions detailed in Section 10.6 of the Agreement. 
To the extent that any operating parameters vary, the applicable charges shall be generated from the rate change tables contained in this Exhibit I.  In the event that Spirit’s actual operating conditions fall between points in the FHA Rate Adjustment Matrices, IAE shall use the Microsoft Excel spreadsheets referenced in Exhibit I hereto to calculate the applicable FHA Rate using linear interpolation (the “FHA Rate Interpolation Tool”).  If the actual utilization parameters fall between two separate tables, the table with the higher factor shall apply.

If any of the actual operating parameters fall outside the coverage of the tables contained in this Exhibit I, the Parties shall agree a rate adjustment based on the same method of calculation used to derive the tables (and not based on simple extrapolation).
*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

Exhibit I-4
FHA Rate Interpolation Tool

*****

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.
    

Exhibit 10.2

400 Main Street, M/S 121-10
East Hartford, CT 06108 USA
 
October 1, 2013

Spirit Airlines, Inc.
2800 Executive Way
Miramar, Florida 33025

		
	Subject:
	Side Letter No. 1 to the Amended and Restated V2500-A5 Fleet Hour Agreement between IAE International Aero Engines AG and Spirit Airlines, Inc., dated October 1, 2013 

Gentlemen:

We refer to (i) the Amended and Restated Fleet Hour Agreement dated October 1, 2013 between IAE and Spirit, as amended from time to time (the “Existing Fleet FHA”) and (ii) Side Letter No. 2, dated October 1, 2013 (“Side Letter No. 2”) to the V2500-A5 General Terms of Sale dated October 1, 2013 between IAE and Spirit, as amended from time to time (the “New Fleet Contract”).  Unless expressly stated to the contrary, and to the extent possible, terms used in this Side Letter No. 1 (“Side Letter No. 1”) shall have the same meaning given to them in the Existing Fleet FHA. 
In consideration of Spirit purchasing fifteen (15) Incremental Aircraft, as defined in Side Letter No. 2, the Parties agree as follows:
		
	1.
	Existing Fleet – *****

Section 11.1 of the Existing Fleet FHA shall be deleted in its entirety and shall be replaced with the following:
*****
Except as expressly amended by this Side Letter No. 1, all provisions of the Existing FHA remain in full force and effect.
	
					
	Agreed to and accepted on behalf of:
IAE International Aero Engines AG
	 
	Agreed to and accepted on behalf of:
Spirit Airlines, Inc.

	By:
	/s/ Rick Deurloo
	 
	By:
	/s/ Edward Christie

	Name:
	Rick Deurloo
	 
	Name:
	Edward Christie

	Title:
	SVP Sales
	 
	Title:
	SVP & CFO

	Date:
	10/2/13
	 
	Date:
	10/2/13

*****Confidential portions of the material have been omitted and filed separately with the Securities and Exchange Commission.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00222-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00222-of-00352.parquet"}]]