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Title: |
Code Share Agreement |
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Date: |
2003 |
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Preview shows 21KB of 140KB total |
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$47 |
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#843392 |
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RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THE SYMBOL
"[***]" IN THIS EXHIBIT INDICATES THAT INFORMATION HAS BEEN OMITTED.
CODE SHARE AGREEMENT
This CODE SHARE AGREEMENT (this "Agreement") is made and entered into as of
September 18, 2003 (the "Contract Date") to be effective as of January 1, 2004
(the "Effective Date"), by and between FRONTIER AIRLINES, INC., a Colorado
corporation ("Frontier"), and HORIZON AIR INDUSTRIES, INC., a Washington
corporation ("Partner"). Certain capitalized terms not otherwise defined herein
will have the meanings ascribed to them in Schedule A to this Agreement.
R E C I T A L S
A. Frontier holds a certificate of public convenience and necessity issued
by the Department of Transportation ("DOT") authorizing it to engage in the
interstate and overseas air transportation of persons, property and mail between
all points in the United States, its territories and possessions.
B. Partner holds certificates of public convenience and necessity issued
by the DOT authorizing Partner to engage in the interstate transportation of
persons, property and mail in the United States, its territories and
possessions.
C. Frontier owns various trademarks, service marks and logos, including
"Frontier Airlines" and distinctive exterior color decor and patterns on its
aircraft, hereinafter referred to individually and collectively as the "Frontier
Service Marks."
D. Frontier and Partner desire to enter into a code share agreement
whereby Partner will provide certain flight and other services to Frontier on
terms and conditions more particularly set forth in this Agreement from and
after the Effective Date.
NOW, THEREFORE, in consideration of the promises, covenants, representations and
warranties hereinafter set forth, and for other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Frontier and Partner
agree as set forth below.
A G R E E M E N T
1. Rights, Responsibilities and Obligations of Partner:
1.1 Flight Service. During the term of this Agreement, Partner
will operate "Frontier JetExpress" air transportation services
(the "Flight Services") using the Initial Fleet and the Option
Fleet (each as defined in Section 1.3) to and from the cities
and based upon the schedule established from time to time by
Frontier (the "Schedule") and provided to Partner by written
notice (a "Schedule Notice") no less than 70 days for schedule
changes not involving Flight Services to new cities and no
less than 90 days for schedule changes involving the addition
of Flight Services to a new city or cities prior to the
effective date of the schedule change described in the
Schedule Notice. The aircraft comprising the Fleet will be
Bombardier CRJ-700s and are herein collectively referred to as
the "Aircraft."
{PAGE}
For purposes of this Agreement, "Flights" means flights
operated pursuant to the Schedule. Frontier may change the
Schedule by issuance of a Schedule Notice at any time. When
creating a Schedule, Frontier shall: (i) create a Schedule
which will permit Partner to schedule flight crews in a manner
consistent with Partner's block time, operational and
maintenance practices set forth on Exhibit 1.1 to this
Agreement, as modified from time to time by mutual agreement
of the parties prior to the due date of the relevant Schedule
Notice; (ii) take into account airport facilities available
for Aircraft handling; (iii) permit maintenance as required by
Section 1.7.2 and scheduled heavy maintenance on Aircraft, as
required; (iv) take into account the Spare Aircraft (as
defined in Section 1.3.1); and (v) provide for at least 70
days prior notice of any holiday cancellations.
1.2 Ad Hoc Schedule Changes. Frontier may at its election require
ad hoc changes to the Schedule for any reason including but
not limited to irregular operations, mechanical problems,
weather conditions, or charter opportunities (such flights as
requested on an ad hoc basis by Frontier and not otherwise
reflected on a Schedule Notice hereby defined as "Ad Hoc
Flights"). Frontier and Partner will discuss Ad Hoc Flights
and Partner will complete such Ad Hoc Flights only upon mutual
agreement of the parties. Ad Hoc Flights completed by Partner
will become part of the Schedule for purposes of Section 6.2
but will be excluded from the Partner's performance
requirements under Section 4.
1.3 Fleet.
1.3.1 Initial Fleet. Each of the Aircraft identified on
Exhibit 1.3.1 as the initial aircraft (the "Initial
Fleet") will be Bombardier CRJ-700s and shall be
placed into Flight Services by Partner in the
calendar months set forth on Exhibit 1.3.1 (the
"Delivery Schedule"). For new aircraft deliveries
Partner will provide no less than 60 days' prior
written notice of the week in which the Aircraft in
the Initial Fleet will be delivered, and no less than
30 days' prior written notice of the day on which the
Aircraft in the Initial fleet will be delivered. In
the event Partner is unable to meet the delivery week
or dates set for on any notice, Partner may use a
Substitute Aircraft (as defined in Section 1.3.4) to
operate any Flight that was scheduled for the delayed
Aircraft for up to 30 days or, with prior consent of
Frontier, for such longer period as may be necessary.
The Initial Fleet will be comprised of eight (8) core
operating Aircraft (the "Core Aircraft") and one (1)
operational spare Aircraft (the "Spare Aircraft").
1.3.2 Option Fleet. Frontier and Partner agree to meet
periodically during the term of this Agreement to
discuss and if possible agree on the expansion of the
Initial Fleet by as many as twelve (12) Aircraft (the
"Option Fleet"). Placement of the Option Fleet into
Flight Services is subject to review and mutual
agreement between the parties, provided, it is
understood and agreed that the terms and conditions
set forth in this Agreement will generally be
applicable to the Option Fleet other than such
changes as may be agreed to by the parties with
respect to the Fixed Costs and Maintenance Parts
relating to the Option Aircraft and the possible
extension of the term of this Agreement
{PAGE}
to take into account a reasonable operating
commitment for the Option Fleet. The Initial Fleet
and the Option Fleet are collectively referred to
herein as the "Fleet."
1.3.3 Aircraft Configuration, Decor and Livery. From the
Effective Date until such time that all Aircraft in
the Initial Fleet are operating as Frontier
JetExpress Flights, all but two (2) of the Aircraft
shall be painted, marked and decorated to bear
Frontier Service Marks, consisting of Frontier livery
and the name "Frontier JetExpress" in accordance with
the livery standards to be provided by Frontier (the
"Frontier JetExpress Livery") and, at Frontier's
election, meet the configurations and interior decor
standards set forth in Exhibit 1.3.3 (the
"Configuration Standards"). Thereafter, eighty
percent (80%) of the Fleet, rounded up to the nearest
whole number, shall be painted, marked and decorated
to bear the "Frontier JetExpress Livery" and, at
Frontier's election, meet the Configuration
Standards. Aircraft not required to be in Frontier
JetExpress Livery under the prior sentence and in the
Fleet may be left with an all white exterior and
otherwise be configured in accordance with Partner's
internal standards (such Aircraft referred to as
"White Tail Aircraft"). Costs and expenses incurred
in meeting the Livery and Configuration Standards or
White Tail configuration will be allocated as
follows: For New Aircraft, the Aircraft will be
delivered in the Frontier JetExpress Livery and
covered by the terms of the purchase agreement
between Partner and the Aircraft manufacturer, and
costs relating to the application of the animal motif
tail decal and any costs associated with Frontier
Configuration Standards over and above costs for
Partner's own configuration shall be borne by
Frontier. For Used Aircraft, the costs of removing
the existing livery and placing the exterior of the
Aircraft in an all white condition will be borne by
Partner, and the cost of placing the Frontier
JetExpress Livery and the application of the animal
motif decal for all Used Aircraft not being left as
White Tail Aircraft will be borne by Frontier. Should
Frontier elect to have the New Aircraft delivered to
meet the Configuration Standards, or have the
interior of the Used Aircraft (other than the White
Tail Aircraft) modified to meet the Configuration
Standards, related costs and expenses will be borne
by Frontier. Any changes to the Livery and
Configuration Standards requested by Frontier after
the Aircraft are placed into service as part of the
Fleet will be performed by Partner at Frontier's sole
cost and expense. Such configuration changes must be
accomplished within 120 days following Frontier's
request. In the event Frontier desires changes to
Frontier JetExpress Livery, Frontier will provide
Partner with 120 days' prior written notice and all
requested changes must be accomplished by the end of
such 120 day period, at Frontier's sole cost and
expense. Partner shall use and display suitable signs
on the interior and exterior of each Aircraft
identifying Partner as the operator of the Flight
Services. All announcements, displays or literature
used or viewed by Partner customers on Flights shall
feature Frontier or "Frontier JetExpress," and no
other air carrier.
{PAGE}
1.3.4 Substitute Aircraft. In order to address maintenance
requirements, irregular operations, or Aircraft
delivery delays as permitted under Section 1.3.1,
Partner may substitute for any Aircraft in the Fleet
an aircraft from its own operational fleet (each, a
"Substitute Aircraft") for up to thirty (30) days, so
long as such substitute aircraft is a White Tail
Aircraft or Horizon Livery. Permanent substitutions
or substitutions over thirty (30) days for any
aircraft in the Fleet will require the advance
written consent of Frontier.
1.3.5 Fleet Domicile. On or before the Effective Date,
Partner will domicile crews required for the Fleet
Services in Denver, Colorado and establish a line
maintenance base capable of performing A Checks and
clearing MELs at Denver International Airport.
1.4 Other Services. Frontier will be responsible for providing all
Other Services required in connection with the Flight Services
through the use of its own personnel or through the retention
of third party contractors, and will be responsible for all
costs and expenses related to such Other Services. Should
Frontier request proposals to subcontract for Other Services,
Partner will have a right of first refusal to provide such
Other Services upon the most favorable terms and conditions
being offered to Frontier by other subcontractors on a "right
of first refusal" basis. In the event Partner is selected to
perform the Other Services on a subcontract basis, Frontier
and Partner will enter into a separate agreement with respect
to such Other Service, the terms of which will be separate and
apart from this Agreement.
1.5 Personnel; Training. Partner shall hire, engage, employ and
maintain a sufficient number of trained personnel and
subcontractors, including, but not limited to pilots, flight
attendants, and maintenance personnel necessary to provide the
Flight Services required by this Agreement. Pilots, Flight
Attendants, and maintenance personnel shall wear Partner
uniforms. For flights attendants newly hired by Partner to
provide Flight Services, Frontier will be responsible for the
cost of initial training. For current Partner flight
attendants transferring to Frontier Flight Services, Frontier
will be responsible for relocation costs. Frontier will be
responsible for initial Pilot Training costs for new Aircraft
Partner will allocate such costs over a 12 month period
beginning at the time of initial training and no interest will
be assessed by Partner. Partner will be responsible for all
recurrent training expenses relating to pilots, flight
attendants or mechanics, including uniform allowances and
cleaning in accordance with collective bargaining agreements
and its internal policies, except costs related to differences
in training related to Frontier Service requirements. Costs
and expense for which Frontier is responsible under this
Section will be remitted as part of the Pass Thru Costs.
Should Frontier elect to provide an initial orientation
program or any similar subsequent refresher programs for any
Partner personnel involved in Flight Services, Frontier will
be responsible for all costs and expenses, including without
limitation expenses relating to travel, room and board. If
Frontier elects to carry hazardous and/or dangerous materials,
Frontier will work with Partner to insure that all such
hazardous materials training meets all governmental
regulations applicable to Frontier and Partner. Such training
and related costs will be the sole responsibility of Frontier.
{PAGE}
1.6 Service Quality and Level. All Flight Services and Other
Services shall be provided by Partner at a service quality and
level of service equal to or greater than the service quality
and level of service provided by Frontier to the extent
applicable to the type of Aircraft used to provide the Flight
Services. More specifically, but without limitation:
1.6.1 Partner pilots and flights attendants
providing Flight Services will be required and trained to
comply with Partner's appearance standards as set forth on
Exhibit 1.6.1.
1.6.2 All Aircraft in the Fleet, at the time of
commencing any Flight Service in the Schedule, must have a
functioning lavatory and coffee maker, notwithstanding any
regulations of the FAA that would permit operation of the
Aircraft with such equipment tagged inoperable. Any flight
cancelled pursuant to this subparagraph will be deemed to be a
flight cancellation for purposes of calculating the FCF and
the OTP (each as defined in Section 4).
1.6.3 In the event Frontier is required to
reaccommodate a passenger who is unable to complete a
scheduled flight because of an inoperable seat, Frontier will
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