þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
For the quarterly period ended September 30, 2016
|
|
or
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
For the transition period from ________ to ________
|
TEXAS
|
74-1563240
|
(State or other jurisdiction of
|
(IRS Employer
|
incorporation or organization)
|
Identification No.)
|
P.O. Box 36611
|
|
Dallas, Texas
|
75235-1611
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
þ
|
Accelerated filer
¨
|
Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
¨
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,966
|
|
|
$
|
1,583
|
|
Short-term investments
|
1,480
|
|
|
1,468
|
|
||
Accounts and other receivables
|
848
|
|
|
474
|
|
||
Inventories of parts and supplies, at cost
|
331
|
|
|
311
|
|
||
Prepaid expenses and other current assets
|
214
|
|
|
188
|
|
||
Total current assets
|
4,839
|
|
|
4,024
|
|
||
|
|
|
|
||||
Property and equipment, at cost:
|
|
|
|
|
|
||
Flight equipment
|
19,978
|
|
|
19,462
|
|
||
Ground property and equipment
|
3,600
|
|
|
3,219
|
|
||
Deposits on flight equipment purchase contracts
|
1,113
|
|
|
1,089
|
|
||
Assets constructed for others
|
1,150
|
|
|
915
|
|
||
|
25,841
|
|
|
24,685
|
|
||
Less allowance for depreciation and amortization
|
9,295
|
|
|
9,084
|
|
||
|
16,546
|
|
|
15,601
|
|
||
Goodwill
|
970
|
|
|
970
|
|
||
Other assets
|
690
|
|
|
717
|
|
||
|
$
|
23,045
|
|
|
$
|
21,312
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
1,021
|
|
|
$
|
1,188
|
|
Accrued liabilities
|
2,146
|
|
|
2,591
|
|
||
Air traffic liability
|
3,677
|
|
|
2,990
|
|
||
Current maturities of long-term debt
|
972
|
|
|
637
|
|
||
Total current liabilities
|
7,816
|
|
|
7,406
|
|
||
|
|
|
|
||||
Long-term debt less current maturities
|
2,323
|
|
|
2,541
|
|
||
Deferred income taxes
|
3,209
|
|
|
2,490
|
|
||
Construction obligation
|
989
|
|
|
757
|
|
||
Other noncurrent liabilities
|
661
|
|
|
760
|
|
||
Stockholders' equity:
|
|
|
|
|
|
||
Common stock
|
808
|
|
|
808
|
|
||
Capital in excess of par value
|
1,402
|
|
|
1,374
|
|
||
Retained earnings
|
10,957
|
|
|
9,409
|
|
||
Accumulated other comprehensive loss
|
(499
|
)
|
|
(1,051
|
)
|
||
Treasury stock, at cost
|
(4,621
|
)
|
|
(3,182
|
)
|
||
Total stockholders' equity
|
8,047
|
|
|
7,358
|
|
||
|
$
|
23,045
|
|
|
$
|
21,312
|
|
(in millions, except per share amounts)
|
Nine months ended September 30, 2016
|
||
Passenger revenue
|
$
|
(120
|
)
|
Other revenue
|
381
|
|
|
Operating revenues
|
$
|
261
|
|
Net income
|
$
|
139
|
|
Net income per basic share
|
$
|
0.22
|
|
Net income per diluted share
|
$
|
0.22
|
|
(in millions, except per share amounts)
|
Three months ended September 30, 2016
|
|
Nine months ended September 30, 2016
|
||||
Depreciation and amortization expense
|
$
|
31
|
|
|
$
|
94
|
|
Net income
|
$
|
(17
|
)
|
|
$
|
(50
|
)
|
Net income per basic share
|
$
|
(0.03
|
)
|
|
$
|
(0.08
|
)
|
Net income per diluted share
|
$
|
(0.03
|
)
|
|
$
|
(0.08
|
)
|
|
|
Maximum fuel hedged as of
|
|
|
|
|
|
September 30, 2016
|
|
Derivative underlying commodity type as of
|
|
Period (by year)
|
|
(gallons in millions) (a)
|
|
September 30, 2016
|
|
Fourth quarter 2016
|
|
357
|
|
|
Brent crude oil and Gulf Coast jet fuel
|
2017
|
|
1,281
|
|
|
WTI crude and Brent crude oil
|
2018
|
|
744
|
|
|
Brent crude oil
|
|
|
|
|
Asset derivatives
|
|
Liability derivatives
|
||||||||||||
|
|
Balance Sheet
|
|
Fair value at
|
|
Fair value at
|
|
Fair value at
|
|
Fair value at
|
||||||||
(in millions)
|
|
location
|
|
9/30/2016
|
|
12/31/2015
|
|
9/30/2016
|
|
12/31/2015
|
||||||||
Derivatives designated as hedges*
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivative contracts (gross)
|
|
Prepaid expenses and other current assets
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fuel derivative contracts (gross)
|
|
Other assets
|
|
8
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Fuel derivative contracts (gross)
|
|
Accrued liabilities
|
|
22
|
|
|
107
|
|
|
513
|
|
|
526
|
|
||||
Fuel derivative contracts (gross)
|
|
Other noncurrent liabilities
|
|
84
|
|
|
55
|
|
|
137
|
|
|
658
|
|
||||
Interest rate derivative contracts
|
|
Other assets
|
|
13
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Interest rate derivative contracts
|
|
Other noncurrent liabilities
|
|
—
|
|
|
—
|
|
|
36
|
|
|
49
|
|
||||
Total derivatives designated as hedges
|
|
$
|
127
|
|
|
$
|
168
|
|
|
$
|
686
|
|
|
$
|
1,233
|
|
||
Derivatives not designated as hedges*
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivative contracts (gross)
|
|
Prepaid expenses and other current assets
|
|
$
|
13
|
|
|
$
|
39
|
|
|
$
|
7
|
|
|
$
|
26
|
|
Fuel derivative contracts (gross)
|
|
Other assets
|
|
3
|
|
|
5
|
|
|
—
|
|
|
—
|
|
||||
Fuel derivative contracts (gross)
|
|
Accrued liabilities
|
|
333
|
|
|
1,395
|
|
|
526
|
|
|
1,854
|
|
||||
Fuel derivative contracts (gross)
|
|
Other noncurrent liabilities
|
|
134
|
|
|
330
|
|
|
136
|
|
|
352
|
|
||||
Total derivatives not designated as hedges
|
|
|
|
$
|
483
|
|
|
$
|
1,769
|
|
|
$
|
669
|
|
|
$
|
2,232
|
|
Total derivatives
|
|
|
|
$
|
610
|
|
|
$
|
1,937
|
|
|
$
|
1,355
|
|
|
$
|
3,465
|
|
|
|
Balance Sheet
|
|
September 30,
|
|
December 31,
|
||||
(in millions)
|
|
location
|
|
2016
|
|
2015
|
||||
Cash collateral deposits held from counterparties for fuel
contracts - current
|
|
Offset against Prepaid expenses and other current assets
|
|
$
|
6
|
|
|
$
|
—
|
|
Cash collateral deposits held from counterparties for fuel
contracts - noncurrent
|
|
Offset against Other assets
|
|
9
|
|
|
—
|
|
||
Cash collateral deposits provided to counterparties for fuel
contracts - current
|
|
Offset against Accrued liabilities
|
|
530
|
|
|
235
|
|
||
Cash collateral deposits provided to counterparties for fuel
contracts - noncurrent |
|
Offset against Other noncurrent liabilities
|
|
90
|
|
|
600
|
|
||
Due to third parties for fuel contracts
|
|
Accounts payable
|
|
94
|
|
|
46
|
|
Offsetting of derivative assets
|
||||||||||||||||||||||||||
(in millions)
|
||||||||||||||||||||||||||
|
|
|
|
(i)
|
|
(ii)
|
|
(iii) = (i) + (ii)
|
|
(i)
|
|
(ii)
|
|
(iii) = (i) + (ii)
|
||||||||||||
|
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
Description
|
|
Balance Sheet location
|
|
Gross amounts of recognized assets
|
|
Gross amounts offset in the Balance Sheet
|
|
Net amounts of assets presented in the Balance Sheet (a)
|
|
Gross amounts of recognized assets
|
|
Gross amounts offset in the Balance Sheet
|
|
Net amounts of assets presented in the Balance Sheet (a)
|
||||||||||||
Fuel derivative contracts
|
|
Prepaid expenses and other current assets
|
|
$
|
13
|
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
|
$
|
41
|
|
|
$
|
(26
|
)
|
|
$
|
15
|
|
Fuel derivative contracts
|
|
Other assets
|
|
$
|
11
|
|
|
$
|
(9
|
)
|
|
$
|
2
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
7
|
|
Fuel derivative contracts
|
|
Accrued liabilities
|
|
$
|
885
|
|
|
$
|
(885
|
)
|
|
$
|
—
|
|
|
$
|
1,737
|
|
|
$
|
(1,737
|
)
|
|
$
|
—
|
|
Fuel derivative contracts
|
|
Other noncurrent liabilities
|
|
$
|
308
|
|
|
$
|
(273
|
)
|
|
$
|
35
|
|
|
$
|
985
|
|
|
$
|
(985
|
)
|
|
$
|
—
|
|
Interest rate derivative contracts
|
|
Other assets
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Derivatives in cash flow hedging relationships
|
|||||||||||||||||||||||
|
(Gain) loss recognized in AOCI on derivatives (effective
portion)
|
|
(Gain) loss reclassified from AOCI into income (effective
portion) (a)
|
|
(Gain) loss recognized in income on derivatives
(ineffective portion) (b)
|
||||||||||||||||||
|
Three months ended
|
|
Three months ended
|
|
Three months ended
|
||||||||||||||||||
|
September 30,
|
|
September 30,
|
|
September 30,
|
||||||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
Fuel derivative contracts
|
$
|
19
|
|
*
|
$
|
315
|
|
*
|
$
|
141
|
|
*
|
$
|
79
|
|
*
|
$
|
(4
|
)
|
|
$
|
—
|
|
Interest rate derivatives
|
(2
|
)
|
*
|
3
|
|
*
|
2
|
|
*
|
3
|
|
*
|
(2
|
)
|
|
—
|
|
||||||
Total
|
$
|
17
|
|
|
$
|
318
|
|
|
$
|
143
|
|
|
$
|
82
|
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
Derivatives not in cash flow hedging relationships
|
|||||||||
|
|
|
|
||||||
|
(Gain) loss
recognized in income on
derivatives
|
|
|
||||||
|
|
|
|||||||
|
Nine months ended
|
|
Location of (gain) loss
recognized in income
on derivatives
|
||||||
|
September 30,
|
|
|||||||
(in millions)
|
2016
|
|
2015
|
|
|||||
Fuel derivative contracts
|
$
|
23
|
|
|
$
|
330
|
|
|
Other (gains) losses, net
|
|
Counterparty (CP)
|
|
|
||||||||||||||||||||||||||||
(in millions)
|
A
|
|
B
|
|
C
|
|
D
|
|
E
|
|
F
|
|
Other
(a)
|
|
Total
|
||||||||||||||||
Fair value of fuel derivatives
|
$
|
(414
|
)
|
|
$
|
(118
|
)
|
|
$
|
(4
|
)
|
|
$
|
(169
|
)
|
|
$
|
(33
|
)
|
|
$
|
15
|
|
|
$
|
1
|
|
|
$
|
(722
|
)
|
Cash collateral held from (by) CP
|
(399
|
)
|
|
(77
|
)
|
|
—
|
|
|
(144
|
)
|
|
—
|
|
|
15
|
|
|
—
|
|
|
(605
|
)
|
||||||||
Aircraft collateral pledged to CP
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Letters of credit (LC)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Option to substitute LC for aircraft
|
(200) to (600)(h)
|
|
(100) to (500)(d)
|
|
N/A
|
|
(150) to (550)(d)
|
|
(150) to (550)(d)
|
|
N/A
|
|
|
|
|
||||||||||||||||
Option to substitute LC for cash
|
N/A
|
|
>(500)(e)
|
|
(225) to (275)(e)
|
|
(75) to (150) or >(550)(e)
|
|
(125) to (150) or >(550)(e)
|
|
(g)
|
|
|
|
|
||||||||||||||||
If credit rating is investment
grade, fair value of fuel
derivative level at which:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash is provided to CP
|
(50) to (200) or >(600)
|
|
(50) to (100) or >(500)
|
|
>(125)
|
|
(75) to (150) or >(550)
|
|
(125) to (150) or >(550)
|
|
>(100)
|
|
|
|
|
||||||||||||||||
Cash is received from CP
|
>50(c)
|
|
>150(c)
|
|
>175(c)
|
|
>250(c)
|
|
>75(c)
|
|
>0(c)
|
|
|
|
|
||||||||||||||||
Aircraft or cash can be pledged to
CP as collateral
|
(200) to (600)(f)
|
|
(100) to (500)(d)
|
|
N/A
|
|
(150) to (550)(d)
|
|
(150) to (550)(d)
|
|
N/A
|
|
|
|
|
||||||||||||||||
If credit rating is non-investment
grade, fair value of fuel derivative level at which:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash is provided to CP
|
(0) to (200) or >(600)
|
|
(0) to (100) or >(500)
|
|
(b)
|
|
(0) to (150) or >(550)
|
|
(0) to (150) or >(550)
|
|
(b)
|
|
|
|
|
||||||||||||||||
Cash is received from CP
|
(b)
|
|
(b)
|
|
(b)
|
|
(b)
|
|
(b)
|
|
(b)
|
|
|
|
|
||||||||||||||||
Aircraft or cash can be pledged to
CP as collateral
|
(200) to (600)
|
|
(100) to (500)
|
|
N/A
|
|
(150) to (550)
|
|
(150) to (550)
|
|
N/A
|
|
|
|
|
|
Three months ended September 30,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
NET INCOME
|
$
|
388
|
|
|
$
|
584
|
|
Unrealized gain (loss) on fuel derivative instruments, net of
deferred taxes of $72 and ($139)
|
122
|
|
|
(236
|
)
|
||
Unrealized gain on interest rate derivative instruments, net of
deferred taxes of $2 and $-
|
4
|
|
|
—
|
|
||
Other, net of deferred taxes of $2 and ($2)
|
3
|
|
|
(3
|
)
|
||
Total other comprehensive income (loss)
|
$
|
129
|
|
|
$
|
(239
|
)
|
COMPREHENSIVE INCOME
|
$
|
517
|
|
|
$
|
345
|
|
|
Nine months ended September 30,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
NET INCOME
|
$
|
1,722
|
|
|
$
|
1,645
|
|
Unrealized gain (loss) on fuel derivative instruments, net of
deferred taxes of $321 and ($97)
|
546
|
|
|
(164
|
)
|
||
Unrealized gain on interest rate derivative instruments, net of
deferred taxes of $1 and $2
|
3
|
|
|
3
|
|
||
Other, net of deferred taxes of $2 and ($1)
|
3
|
|
|
(4
|
)
|
||
Total other comprehensive income (loss)
|
$
|
552
|
|
|
$
|
(165
|
)
|
COMPREHENSIVE INCOME
|
$
|
2,274
|
|
|
$
|
1,480
|
|
(in millions)
|
Fuel derivatives
|
|
Interest rate derivatives
|
|
Defined benefit plan items
|
|
Other
|
|
Deferred tax
|
|
Accumulated other
comprehensive income (loss)
|
||||||||||||
Balance at June 30, 2016
|
$
|
(993
|
)
|
|
$
|
(32
|
)
|
|
$
|
22
|
|
|
$
|
6
|
|
|
$
|
369
|
|
|
$
|
(628
|
)
|
Changes in fair value
|
(30
|
)
|
|
3
|
|
|
—
|
|
|
5
|
|
|
8
|
|
|
(14
|
)
|
||||||
Reclassification to earnings
|
224
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
(84
|
)
|
|
143
|
|
||||||
Balance at September 30, 2016
|
$
|
(799
|
)
|
|
$
|
(26
|
)
|
|
$
|
22
|
|
|
$
|
11
|
|
|
$
|
293
|
|
|
$
|
(499
|
)
|
(in millions)
|
Fuel derivatives
|
|
Interest rate derivatives
|
|
Defined benefit plan items
|
|
Other
|
|
Deferred tax
|
|
Accumulated other
comprehensive income (loss)
|
||||||||||||
Balance at December 31, 2015
|
$
|
(1,666
|
)
|
|
$
|
(30
|
)
|
|
$
|
22
|
|
|
$
|
6
|
|
|
$
|
617
|
|
|
$
|
(1,051
|
)
|
Changes in fair value
|
98
|
|
|
(7
|
)
|
|
—
|
|
|
5
|
|
|
(35
|
)
|
|
61
|
|
||||||
Reclassification to earnings
|
769
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
(289
|
)
|
|
491
|
|
||||||
Balance at September 30, 2016
|
$
|
(799
|
)
|
|
$
|
(26
|
)
|
|
$
|
22
|
|
|
$
|
11
|
|
|
$
|
293
|
|
|
$
|
(499
|
)
|
Three months ended September 30, 2016
|
||||||
(in millions)
|
|
Amounts reclassified from AOCI
|
|
Affected line item in the unaudited Condensed Consolidated Statement of
Comprehensive Income
|
||
AOCI components
|
|
|
||||
Unrealized loss on fuel derivative instruments
|
|
$
|
224
|
|
|
Fuel and oil expense
|
|
|
83
|
|
|
Less: Tax Expense
|
|
|
|
$
|
141
|
|
|
Net of tax
|
Unrealized loss on interest rate derivative instruments
|
|
$
|
3
|
|
|
Interest expense
|
|
|
1
|
|
|
Less: Tax Expense
|
|
|
|
$
|
2
|
|
|
Net of tax
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
143
|
|
|
Net of tax
|
Nine months ended September 30, 2016
|
||||||
(in millions)
|
|
Amounts reclassified from AOCI
|
|
Affected line item in the unaudited Condensed Consolidated Statement of
Comprehensive Income
|
||
AOCI components
|
|
|
||||
Unrealized loss on fuel derivative instruments
|
|
$
|
769
|
|
|
Fuel and oil expense
|
|
|
285
|
|
|
Less: Tax Expense
|
|
|
|
$
|
484
|
|
|
Net of tax
|
Unrealized loss on interest rate derivative instruments
|
|
$
|
11
|
|
|
Interest expense
|
|
|
4
|
|
|
Less: Tax Expense
|
|
|
|
$
|
7
|
|
|
Net of tax
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
491
|
|
|
Net of tax
|
(in millions)
|
September 30, 2016
|
|
December 31, 2015
|
||||
Intangible assets, net
|
$
|
430
|
|
|
$
|
464
|
|
Non-current investments
|
35
|
|
|
40
|
|
||
Other
|
225
|
|
|
213
|
|
||
Other assets
|
$
|
690
|
|
|
$
|
717
|
|
(in millions)
|
September 30, 2016
|
|
December 31, 2015
|
||||
Accounts payable trade
|
$
|
148
|
|
|
$
|
178
|
|
Salaries payable
|
149
|
|
|
173
|
|
||
Taxes payable
|
165
|
|
|
179
|
|
||
Aircraft maintenance payable
|
25
|
|
|
168
|
|
||
Fuel payable
|
66
|
|
|
48
|
|
||
Other payables
|
468
|
|
|
442
|
|
||
Accounts payable
|
$
|
1,021
|
|
|
$
|
1,188
|
|
(in millions)
|
September 30, 2016
|
|
December 31, 2015
|
||||
ProfitSharing and savings plans
|
$
|
517
|
|
|
$
|
655
|
|
Aircraft and other lease related obligations
|
52
|
|
|
74
|
|
||
Vacation pay
|
339
|
|
|
309
|
|
||
Accrued union bonuses (a)
|
533
|
|
|
329
|
|
||
Health
|
90
|
|
|
86
|
|
||
Derivative contracts
|
154
|
|
|
643
|
|
||
Workers compensation
|
179
|
|
|
187
|
|
||
Property and income taxes
|
63
|
|
|
62
|
|
||
Other
|
219
|
|
|
246
|
|
||
Accrued liabilities
|
$
|
2,146
|
|
|
$
|
2,591
|
|
(in millions)
|
September 30, 2016
|
|
December 31, 2015
|
||||
Postretirement obligation
|
$
|
215
|
|
|
$
|
201
|
|
Non-current lease-related obligations
|
135
|
|
|
165
|
|
||
Other deferred compensation
|
195
|
|
|
179
|
|
||
Deferred gains from sale and leaseback of aircraft
|
33
|
|
|
43
|
|
||
Derivative contracts
|
1
|
|
|
74
|
|
||
Other
|
82
|
|
|
98
|
|
||
Other noncurrent liabilities
|
$
|
661
|
|
|
$
|
760
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
NUMERATOR:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
388
|
|
|
$
|
584
|
|
|
$
|
1,722
|
|
|
$
|
1,645
|
|
Incremental income effect of interest on 5.25% convertible notes
|
1
|
|
|
1
|
|
|
2
|
|
|
3
|
|
||||
Net income after assumed conversion
|
$
|
389
|
|
|
$
|
585
|
|
|
$
|
1,724
|
|
|
$
|
1,648
|
|
|
|
|
|
|
|
|
|
||||||||
DENOMINATOR:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average shares outstanding, basic
|
618
|
|
|
655
|
|
|
630
|
|
|
665
|
|
||||
Dilutive effect of Employee stock options and restricted stock units
|
1
|
|
|
2
|
|
|
2
|
|
|
2
|
|
||||
Dilutive effect of 5.25% convertible notes
|
6
|
|
|
6
|
|
|
6
|
|
|
6
|
|
||||
Adjusted weighted-average shares outstanding, diluted
|
625
|
|
|
663
|
|
|
638
|
|
|
673
|
|
||||
|
|
|
|
|
|
|
|
||||||||
NET INCOME PER SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
0.63
|
|
|
$
|
0.89
|
|
|
$
|
2.73
|
|
|
$
|
2.47
|
|
Diluted
|
$
|
0.62
|
|
|
$
|
0.88
|
|
|
$
|
2.70
|
|
|
$
|
2.45
|
|
|
The Boeing Company
737
|
|
|
|
|
|||||
|
-800 Firm Orders
|
-800 Options
|
-7
Firm Orders |
-8
Firm Orders |
|
-8 Options
|
|
Additional -700s
|
Total
|
|
2016
|
38
|
—
|
—
|
—
|
|
—
|
|
23
|
61
|
(2)
|
2017
|
39
|
—
|
—
|
14
|
|
—
|
|
14
|
67
|
|
2018
|
16
|
14
|
—
|
13
|
|
—
|
|
4
|
47
|
|
2019
|
—
|
—
|
15
|
—
|
|
5
|
|
—
|
20
|
|
2020
|
—
|
—
|
14
|
—
|
|
8
|
|
—
|
22
|
|
2021
|
—
|
—
|
1
|
13
|
|
18
|
|
—
|
32
|
|
2022
|
—
|
—
|
—
|
15
|
|
19
|
|
—
|
34
|
|
2023
|
—
|
—
|
—
|
34
|
|
23
|
|
—
|
57
|
|
2024
|
—
|
—
|
—
|
41
|
|
23
|
|
—
|
64
|
|
2025
|
—
|
—
|
—
|
40
|
|
36
|
|
—
|
76
|
|
2026
|
—
|
—
|
—
|
—
|
|
36
|
|
—
|
36
|
|
2027
|
—
|
—
|
—
|
—
|
|
23
|
|
—
|
23
|
|
Total
|
93
|
14
|
30
|
170
|
(1)
|
191
|
(1)
|
41
|
539
|
|
|
|
|
|
Fair value measurements at reporting date using:
|
||||||||||||
|
|
|
|
Quoted prices in
active markets
for identical assets
|
|
Significant
other observable
inputs
|
|
Significant
unobservable
inputs
|
||||||||
Description
|
|
September 30, 2016
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
(in millions)
|
||||||||||||||
Cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents (a)
|
|
$
|
1,706
|
|
|
$
|
1,706
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
|
250
|
|
|
—
|
|
|
250
|
|
|
—
|
|
||||
Certificates of deposit
|
|
10
|
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Treasury bills
|
|
1,198
|
|
|
1,198
|
|
|
—
|
|
|
—
|
|
||||
Certificates of deposit
|
|
282
|
|
|
—
|
|
|
282
|
|
|
—
|
|
||||
Interest rate derivatives (see Note 3)
|
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Swap contracts (b)
|
|
8
|
|
|
—
|
|
|
8
|
|
|
—
|
|
||||
Swap contracts (c)
|
|
173
|
|
|
—
|
|
|
173
|
|
|
—
|
|
||||
Option contracts (b)
|
|
16
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||
Option contracts (c)
|
|
400
|
|
|
—
|
|
|
—
|
|
|
400
|
|
||||
Other available-for-sale securities
|
|
96
|
|
|
80
|
|
|
—
|
|
|
16
|
|
||||
Total assets
|
|
$
|
4,152
|
|
|
$
|
2,984
|
|
|
$
|
736
|
|
|
$
|
432
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Swap contracts (b)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
Swap contracts (c)
|
|
(220
|
)
|
|
—
|
|
|
(220
|
)
|
|
—
|
|
||||
Option contracts (b)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
||||
Option contracts (c)
|
|
(1,092
|
)
|
|
—
|
|
|
—
|
|
|
(1,092
|
)
|
||||
Interest rate derivatives (see Note 3)
|
|
(36
|
)
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
||||
Total liabilities
|
|
$
|
(1,355
|
)
|
|
$
|
—
|
|
|
$
|
(258
|
)
|
|
$
|
(1,097
|
)
|
|
|
|
|
Fair value measurements at reporting date using:
|
||||||||||||
|
|
|
|
Quoted prices in
active markets
for identical assets
|
|
Significant
other observable
inputs
|
|
Significant
unobservable
inputs
|
||||||||
Description
|
|
December 31, 2015
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
(in millions)
|
||||||||||||||
Cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents (a)
|
|
$
|
1,337
|
|
|
$
|
1,337
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
|
200
|
|
|
—
|
|
|
200
|
|
|
—
|
|
||||
Certificates of deposit
|
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||
Eurodollar time deposits
|
|
33
|
|
|
—
|
|
|
33
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Treasury bills
|
|
1,248
|
|
|
1,248
|
|
|
—
|
|
|
—
|
|
||||
Certificates of deposit
|
|
220
|
|
|
—
|
|
|
220
|
|
|
—
|
|
||||
Interest rate derivatives (see Note 3)
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Swap contracts (b)
|
|
38
|
|
|
—
|
|
|
38
|
|
|
—
|
|
||||
Swap contracts (c)
|
|
931
|
|
|
—
|
|
|
931
|
|
|
—
|
|
||||
Option contracts (b)
|
|
10
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||
Option contracts (c)
|
|
956
|
|
|
—
|
|
|
—
|
|
|
956
|
|
||||
Other available-for-sale securities
|
|
93
|
|
|
66
|
|
|
—
|
|
|
27
|
|
||||
Total assets
|
|
$
|
5,081
|
|
|
$
|
2,651
|
|
|
$
|
1,437
|
|
|
$
|
993
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Swap contracts (c)
|
|
$
|
(774
|
)
|
|
$
|
—
|
|
|
$
|
(774
|
)
|
|
$
|
—
|
|
Option contracts (b)
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
||||
Option contracts (c)
|
|
(2,616
|
)
|
|
—
|
|
|
—
|
|
|
(2,616
|
)
|
||||
Interest rate derivatives (see Note 3)
|
|
(49
|
)
|
|
—
|
|
|
(49
|
)
|
|
—
|
|
||||
Total liabilities
|
|
$
|
(3,465
|
)
|
|
$
|
—
|
|
|
$
|
(823
|
)
|
|
$
|
(2,642
|
)
|
|
Fair value measurements using significant
unobservable inputs (Level 3)
|
||||||||||
|
Fuel
derivatives
|
|
Other
securities
|
|
|
||||||
(in millions)
|
|
|
Total
|
||||||||
Balance at June 30, 2016
|
$
|
(907
|
)
|
|
$
|
26
|
|
|
$
|
(881
|
)
|
Total gains (losses) (realized or unrealized)
|
|
|
|
|
|
|
|
|
|||
Included in earnings
|
(46
|
)
|
|
—
|
|
|
(46
|
)
|
|||
Included in other comprehensive income
|
(31
|
)
|
|
3
|
|
|
(28
|
)
|
|||
Purchases
|
61
|
|
(a)
|
—
|
|
|
61
|
|
|||
Sales
|
(4
|
)
|
(a)
|
(13
|
)
|
|
(17
|
)
|
|||
Settlements
|
246
|
|
|
—
|
|
|
246
|
|
|||
Balance at September 30, 2016
|
$
|
(681
|
)
|
|
$
|
16
|
|
|
$
|
(665
|
)
|
The amount of total losses for the period
included in earnings attributable to the
change in unrealized gains or losses relating
to option contracts still held at September 30,
2016.
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
Fair value measurements using significant
unobservable inputs (Level 3)
|
||||||||||
|
Fuel
derivatives
|
|
Other
securities
|
|
|
||||||
(in millions)
|
|
|
Total
|
||||||||
Balance at December 31, 2015
|
$
|
(1,676
|
)
|
|
$
|
27
|
|
|
$
|
(1,649
|
)
|
Total gains (realized or unrealized)
|
|
|
|
|
|
|
|
|
|||
Included in earnings
|
128
|
|
|
—
|
|
|
128
|
|
|||
Included in other comprehensive income
|
104
|
|
|
2
|
|
|
106
|
|
|||
Purchases
|
191
|
|
(a)
|
—
|
|
|
191
|
|
|||
Sales
|
(61
|
)
|
(a)
|
(13
|
)
|
|
(74
|
)
|
|||
Settlements
|
633
|
|
|
—
|
|
|
633
|
|
|||
Balance at September 30, 2016
|
$
|
(681
|
)
|
|
$
|
16
|
|
|
$
|
(665
|
)
|
The amount of total gains for the period
included in earnings attributable to the
change in unrealized gains or losses relating
to option contracts still held at September 30,
2016.
|
$
|
95
|
|
|
$
|
—
|
|
|
$
|
95
|
|
Quantitative information about Level 3 fair value measurements
|
||||
|
Valuation technique
|
Unobservable input
|
Period (by year)
|
Range
|
Fuel derivatives
|
Option model
|
Implied volatility
|
Fourth quarter 2016
|
20-35%
|
|
|
|
2017
|
27-38%
|
|
|
|
2018
|
21-32%
|
(in millions)
|
Carrying value
|
|
Estimated fair value
|
|
Fair value level hierarchy
|
||||
5.25% Convertible Senior Notes due November 2016
|
$
|
110
|
|
|
$
|
301
|
|
|
Level 2
|
5.75% Notes due December 2016
|
302
|
|
|
304
|
|
|
Level 2
|
||
5.125% Notes due 2017
|
303
|
|
|
308
|
|
|
Level 2
|
||
French Credit Agreements due 2018 - 1.96%
|
19
|
|
|
19
|
|
|
Level 3
|
||
Fixed-rate 737 Aircraft Notes payable through 2018 - 7.03%
|
9
|
|
|
10
|
|
|
Level 3
|
||
2.75% Notes due 2019
|
307
|
|
|
316
|
|
|
Level 2
|
||
Term Loan Agreement due 2019 - 6.315%
|
115
|
|
|
117
|
|
|
Level 3
|
||
Term Loan Agreement due 2019 - 4.84%
|
28
|
|
|
29
|
|
|
Level 3
|
||
2.65% Notes due 2020
|
507
|
|
|
521
|
|
|
Level 2
|
||
Term Loan Agreement due 2020 - 5.223%
|
296
|
|
|
291
|
|
|
Level 3
|
||
Floating-rate 737 Aircraft Notes payable through 2020
|
217
|
|
|
213
|
|
|
Level 3
|
||
Term Loan Agreements payable through 2021 - 7.94%
|
20
|
|
|
22
|
|
|
Level 3
|
||
Pass Through Certificates due 2022 - 6.24%
|
324
|
|
|
362
|
|
|
Level 2
|
||
7.375% Debentures due 2027
|
130
|
|
|
161
|
|
|
Level 2
|
|
|
Three months ended September 30,
|
|
|
|
|||||||
|
|
2016
|
|
2015
|
|
Change
|
||||||
Revenue passengers carried
|
|
31,768,550
|
|
|
30,559,019
|
|
|
4.0
|
%
|
|
||
Enplaned passengers
|
|
38,852,737
|
|
|
37,765,903
|
|
|
2.9
|
%
|
|
||
Revenue passenger miles (RPMs) (000s)
(1)
|
|
32,315,952
|
|
|
31,052,660
|
|
|
4.1
|
%
|
|
||
Available seat miles (ASMs) (000s)
(2)
|
|
37,881,510
|
|
|
36,360,340
|
|
|
4.2
|
%
|
|
||
Load factor
(3)
|
|
85.3
|
%
|
|
85.4
|
%
|
|
(0.1
|
)
|
pts
|
||
Average length of passenger haul (miles)
|
|
1,017
|
|
|
1,016
|
|
|
0.1
|
%
|
|
||
Average aircraft stage length (miles)
|
|
764
|
|
|
754
|
|
|
1.3
|
%
|
|
||
Trips flown
|
|
332,420
|
|
|
325,301
|
|
|
2.2
|
%
|
|
||
Seats flown
(4)
|
|
49,050,147
|
|
|
47,470,059
|
|
|
3.3
|
%
|
|
||
Seats per trip
(5)
|
|
147.55
|
|
|
145.93
|
|
|
1.1
|
%
|
|
||
Average passenger fare
|
|
$
|
146.96
|
|
|
$
|
154.33
|
|
|
(4.8
|
)%
|
|
Passenger revenue yield per RPM (cents)
(6)
|
|
14.45
|
|
|
15.19
|
|
|
(4.9
|
)%
|
|
||
Operating revenues per ASM (cents)
(7)
|
|
13.57
|
|
|
14.15
|
|
|
(4.1
|
)%
|
|
||
Passenger revenue per ASM (cents)
(8)
|
|
12.32
|
|
|
12.97
|
|
|
(5.0
|
)%
|
|
||
Operating expenses per ASM (cents)
(9)
|
|
11.73
|
|
|
11.26
|
|
|
4.2
|
%
|
|
||
Operating expenses per ASM, excluding fuel (cents)
|
|
9.25
|
|
|
8.68
|
|
|
6.6
|
%
|
|
||
Operating expenses per ASM, excluding fuel and profitsharing (cents)
|
|
8.98
|
|
|
8.19
|
|
|
9.6
|
%
|
|
||
Fuel costs per gallon, including fuel tax
|
|
$
|
1.83
|
|
|
$
|
1.89
|
|
|
(3.2
|
)%
|
|
Fuel costs per gallon, including fuel tax, economic
|
|
$
|
2.02
|
|
|
$
|
2.20
|
|
|
(8.2
|
)%
|
|
Fuel consumed, in gallons (millions)
|
|
513
|
|
|
493
|
|
|
4.1
|
%
|
|
||
Active fulltime equivalent Employees
|
|
53,072
|
|
|
48,642
|
|
|
9.1
|
%
|
|
||
Aircraft at end of period
(10)
|
|
714
|
|
|
692
|
|
|
3.2
|
%
|
|
|
|
Nine months ended September 30,
|
|
|
|
|||||||
|
|
2016
|
|
2015
|
|
Change
|
||||||
Revenue passengers carried
|
|
92,712,998
|
|
|
87,802,757
|
|
|
5.6
|
%
|
|
||
Enplaned passengers
|
|
112,960,419
|
|
|
107,535,145
|
|
|
5.0
|
%
|
|
||
Revenue passenger miles (RPMs) (000s)
(1)
|
|
93,431,810
|
|
|
87,771,907
|
|
|
6.4
|
%
|
|
||
Available seat miles (ASMs) (000s)
(2)
|
|
111,374,942
|
|
|
105,133,835
|
|
|
5.9
|
%
|
|
||
Load factor
(3)
|
|
83.9
|
%
|
|
83.5
|
%
|
|
0.4
|
|
pts
|
||
Average length of passenger haul (miles)
|
|
1,008
|
|
|
1,000
|
|
|
0.8
|
%
|
|
||
Average aircraft stage length (miles)
|
|
763
|
|
|
750
|
|
|
1.7
|
%
|
|
||
Trips flown
|
|
981,409
|
|
|
948,180
|
|
|
3.5
|
%
|
|
||
Seats flown
(4)
|
|
144,264,317
|
|
|
138,326,878
|
|
|
4.3
|
%
|
|
||
Seats per trip
(5)
|
|
147.00
|
|
|
145.89
|
|
|
0.8
|
%
|
|
||
Average passenger fare
(11)
|
|
$
|
150.69
|
|
|
$
|
156.55
|
|
|
(3.7
|
)%
|
|
Passenger revenue yield per RPM (cents)
(6)(11)
|
|
14.95
|
|
|
15.66
|
|
|
(4.5
|
)%
|
|
||
Operating revenues per ASM (cents)
(7)
|
|
13.78
|
|
|
13.95
|
|
|
(1.2
|
)%
|
|
||
Passenger revenue per ASM (cents)
(8)(11)
|
|
12.54
|
|
|
13.07
|
|
|
(4.1
|
)%
|
|
||
Operating expenses per ASM (cents)
(9)
|
|
11.17
|
|
|
11.18
|
|
|
(0.1
|
)%
|
|
||
Operating expenses per ASM, excluding fuel (cents)
|
|
8.74
|
|
|
8.50
|
|
|
2.8
|
%
|
|
||
Operating expenses per ASM, excluding fuel and profitsharing (cents)
|
|
8.33
|
|
|
8.04
|
|
|
3.6
|
%
|
|
||
Fuel costs per gallon, including fuel tax
|
|
$
|
1.79
|
|
|
$
|
1.98
|
|
|
(9.6
|
)%
|
|
Fuel costs per gallon, including fuel tax, economic
|
|
$
|
1.87
|
|
|
$
|
2.08
|
|
|
(10.1
|
)%
|
|
Fuel consumed, in gallons (millions)
|
|
1,498
|
|
|
1,420
|
|
|
5.5
|
%
|
|
||
Active fulltime equivalent Employees
|
|
53,072
|
|
|
48,642
|
|
|
9.1
|
%
|
|
||
Aircraft at end of period
(10)
|
|
714
|
|
|
692
|
|
|
3.2
|
%
|
|
|
|
Three months ended
|
|
|
|
Nine months ended
|
|
|
||||||||||||||
(in millions, except per share amounts)
|
|
September 30,
|
|
|
|
September 30,
|
|
|
||||||||||||||
GAAP
|
|
2016
|
|
2015
|
|
Percent Change
|
|
2016
|
|
2015
|
|
Percent Change
|
||||||||||
Operating income
|
|
$
|
695
|
|
|
$
|
1,225
|
|
|
(43.3
|
)%
|
|
$
|
2,915
|
|
|
$
|
3,090
|
|
|
(5.7
|
)%
|
Net income
|
|
$
|
388
|
|
|
$
|
584
|
|
|
(33.6
|
)%
|
|
$
|
1,722
|
|
|
$
|
1,645
|
|
|
4.7
|
%
|
Net income per share, diluted
|
|
$
|
0.62
|
|
|
$
|
0.88
|
|
|
(29.5
|
)%
|
|
$
|
2.70
|
|
|
$
|
2.45
|
|
|
10.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating income
|
|
$
|
972
|
|
|
$
|
1,047
|
|
|
(7.2
|
)%
|
|
$
|
3,190
|
|
|
$
|
2,965
|
|
|
7.6
|
%
|
Net income
|
|
$
|
582
|
|
|
$
|
623
|
|
|
(6.6
|
)%
|
|
$
|
1,907
|
|
|
$
|
1,764
|
|
|
8.1
|
%
|
Net income per share, diluted
|
|
$
|
0.93
|
|
|
$
|
0.94
|
|
|
(1.1
|
)%
|
|
$
|
3.00
|
|
|
$
|
2.63
|
|
|
14.1
|
%
|
|
Three months ended September 30,
|
|
Per ASM
change
|
|
Percent
change
|
|||||||||
(in cents, except for percentages)
|
2016
|
|
2015
|
|
|
|||||||||
Salaries, wages, and benefits
|
|
5.04
|
¢
|
|
|
4.67
|
¢
|
|
|
0.37
|
¢
|
|
7.9
|
%
|
Fuel and oil
|
2.48
|
|
|
2.58
|
|
|
(0.10
|
)
|
|
(3.9
|
)
|
|||
Maintenance materials and repairs
|
0.68
|
|
|
0.71
|
|
|
(0.03
|
)
|
|
(4.2
|
)
|
|||
Aircraft rentals
|
0.15
|
|
|
0.16
|
|
|
(0.01
|
)
|
|
(6.3
|
)
|
|||
Landing fees and other rentals
|
0.81
|
|
|
0.83
|
|
|
(0.02
|
)
|
|
(2.4
|
)
|
|||
Depreciation and amortization
|
0.83
|
|
|
0.71
|
|
|
0.12
|
|
|
16.9
|
|
|||
Acquisition and integration
|
—
|
|
|
0.02
|
|
|
(0.02
|
)
|
|
n.m.
|
|
|||
Other operating expenses
|
1.74
|
|
|
1.58
|
|
|
0.16
|
|
|
10.1
|
|
|||
Total
|
|
11.73
|
¢
|
|
|
11.26
|
¢
|
|
|
0.47
|
¢
|
|
4.2
|
%
|
Period
|
Maximum percent of estimated fuel consumption covered by fuel derivative contracts at varying WTI/Brent Crude Oil, Heating Oil, and Gulf Coast Jet Fuel-equivalent price levels (1)
|
|
2017
|
63%
|
|
2018
|
36%
|
Year
|
|
Fair value (liability) of fuel derivative contracts at September 30, 2016
|
|
Amount of gains (losses) deferred in AOCI at September 30, 2016 (net of tax)
|
||||
Remainder of 2016
|
|
$
|
(252
|
)
|
|
$
|
(128
|
)
|
2017
|
|
(554
|
)
|
|
(359
|
)
|
||
2018
|
|
84
|
|
|
(16
|
)
|
||
Total
|
|
$
|
(722
|
)
|
|
$
|
(503
|
)
|
|
Estimated economic jet fuel price per gallon,
including taxes |
Average Brent Crude Oil price per barrel
|
4Q 2016 (2)
|
$30
|
$1.60 - $1.65
|
$40
|
$1.80 - $1.85
|
Current Market (1)
|
Approximately $2.10
|
$60
|
$2.15 - $2.20
|
$70
|
$2.35 - $2.40
|
Estimated premium costs (3)
|
Approximately $36 million
|
|
Three months ended September 30,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Mark-to-market impact from fuel contracts settling in future periods
|
$
|
20
|
|
|
$
|
179
|
|
Ineffectiveness from fuel hedges settling in future periods
|
(4
|
)
|
|
(1
|
)
|
||
Realized ineffectiveness and mark-to-market (gains) or losses
|
15
|
|
|
61
|
|
||
Premium cost of fuel contracts
|
34
|
|
|
33
|
|
||
Other
|
(1
|
)
|
|
—
|
|
||
|
$
|
64
|
|
|
$
|
272
|
|
|
Nine months ended September 30,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Mark-to-market impact from fuel contracts settling in future periods
|
$
|
16
|
|
|
$
|
271
|
|
Ineffectiveness from fuel hedges settling in future periods
|
(3
|
)
|
|
(16
|
)
|
||
Realized ineffectiveness and mark-to-market (gains) or losses
|
7
|
|
|
61
|
|
||
Premium cost of fuel contracts
|
117
|
|
|
81
|
|
||
Other
|
(2
|
)
|
|
(3
|
)
|
||
|
$
|
135
|
|
|
$
|
394
|
|
|
Three months ended September 30,
|
|
Percent
|
|
Nine months ended September 30,
|
|
Percent
|
||||||||||||
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||
Total operating revenues, as reported
|
$
|
5,139
|
|
|
$
|
5,318
|
|
|
|
|
$
|
15,350
|
|
|
$
|
14,843
|
|
|
|
Deduct: Special revenue adjustment
|
—
|
|
|
(172
|
)
|
|
|
|
—
|
|
|
(172
|
)
|
|
|
||||
Operating Revenues, Non-GAAP
|
$
|
5,139
|
|
|
$
|
5,146
|
|
|
(0.1)%
|
|
$
|
15,350
|
|
|
$
|
14,671
|
|
|
4.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel and oil expense, unhedged
|
$
|
751
|
|
|
$
|
843
|
|
|
|
|
$
|
2,044
|
|
|
$
|
2,634
|
|
|
|
Add: Fuel hedge (gains) losses included in Fuel and oil expense
|
190
|
|
|
93
|
|
|
|
|
652
|
|
|
184
|
|
|
|
||||
Fuel and oil expense, as reported
|
$
|
941
|
|
|
$
|
936
|
|
|
|
|
$
|
2,696
|
|
|
$
|
2,818
|
|
|
|
Add: Net impact from fuel contracts
|
97
|
|
|
152
|
|
|
|
|
120
|
|
|
143
|
|
|
|
||||
Fuel and oil expense, non-GAAP (economic)
|
$
|
1,038
|
|
|
$
|
1,088
|
|
|
(4.6)%
|
|
$
|
2,816
|
|
|
$
|
2,961
|
|
|
(4.9)%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total operating expenses, as reported
|
$
|
4,444
|
|
|
$
|
4,093
|
|
|
|
|
$
|
12,435
|
|
|
$
|
11,753
|
|
|
|
Deduct: Union contract bonuses
|
(356
|
)
|
|
(140
|
)
|
|
|
|
(356
|
)
|
|
(195
|
)
|
|
|
||||
Add: Reclassification between Fuel and oil and Other (gains) losses, net, associated with current period settled contracts
|
15
|
|
|
61
|
|
|
|
|
7
|
|
|
61
|
|
|
|
||||
Add: Contracts settling in the current period, but for which gains and/or (losses) have been recognized in a prior period*
|
82
|
|
|
91
|
|
|
|
|
113
|
|
|
82
|
|
|
|
||||
Deduct: Acquisition and integration costs
|
—
|
|
|
(6
|
)
|
|
|
|
—
|
|
|
(32
|
)
|
|
|
||||
Add: Litigation settlement
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
37
|
|
|
|
||||
Deduct: Asset impairment
|
—
|
|
|
—
|
|
|
|
|
(21
|
)
|
|
—
|
|
|
|
||||
Deduct: Lease termination expense
|
(18
|
)
|
|
—
|
|
|
|
|
(18
|
)
|
|
—
|
|
|
|
||||
Total operating expenses, non-GAAP
|
$
|
4,167
|
|
|
$
|
4,099
|
|
|
1.7%
|
|
$
|
12,160
|
|
|
$
|
11,706
|
|
|
3.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income, as reported
|
$
|
695
|
|
|
$
|
1,225
|
|
|
|
|
$
|
2,915
|
|
|
$
|
3,090
|
|
|
|
Add: Union contract bonuses
|
356
|
|
|
140
|
|
|
|
|
356
|
|
|
195
|
|
|
|
||||
Deduct: Reclassification between Fuel and oil and Other (gains) losses, net, associated with current period settled contracts
|
(15
|
)
|
|
(61
|
)
|
|
|
|
(7
|
)
|
|
(61
|
)
|
|
|
||||
Deduct: Contracts settling in the current period, but for which gains and/or (losses) have been recognized in a prior period*
|
(82
|
)
|
|
(91
|
)
|
|
|
|
(113
|
)
|
|
(82
|
)
|
|
|
||||
Add: Acquisition and integration costs
|
—
|
|
|
6
|
|
|
|
|
—
|
|
|
32
|
|
|
|
||||
Deduct: Litigation settlement
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(37
|
)
|
|
|
||||
Deduct: Special revenue adjustment
|
—
|
|
|
(172
|
)
|
|
|
|
—
|
|
|
(172
|
)
|
|
|
||||
Add: Asset impairment
|
—
|
|
|
—
|
|
|
|
|
21
|
|
|
—
|
|
|
|
||||
Add: Lease termination expense
|
18
|
|
|
—
|
|
|
|
|
18
|
|
|
—
|
|
|
|
||||
Operating income, non-GAAP
|
$
|
972
|
|
|
$
|
1,047
|
|
|
(7.2)%
|
|
$
|
3,190
|
|
|
$
|
2,965
|
|
|
7.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income, as reported
|
$
|
388
|
|
|
$
|
584
|
|
|
|
|
$
|
1,722
|
|
|
$
|
1,645
|
|
|
|
Add: Union contract bonuses
|
356
|
|
|
140
|
|
|
|
|
356
|
|
|
195
|
|
|
|
||||
Add: Mark-to-market impact from fuel contracts settling in future periods
|
20
|
|
|
179
|
|
|
|
|
16
|
|
|
271
|
|
|
|
||||
Deduct: Ineffectiveness from fuel hedges settling in future periods
|
(4
|
)
|
|
(1
|
)
|
|
|
|
(3
|
)
|
|
(16
|
)
|
|
|
||||
Deduct: Other net impact of fuel contracts settling in the current or a prior period (excluding reclassifications)
|
(82
|
)
|
|
(91
|
)
|
|
|
|
(113
|
)
|
|
(82
|
)
|
|
|
||||
Add: Acquisition and integration costs
|
—
|
|
|
6
|
|
|
|
|
—
|
|
|
32
|
|
|
|
||||
Deduct: Litigation settlement
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(37
|
)
|
|
|
||||
Deduct: Special revenue adjustment
|
—
|
|
|
(172
|
)
|
|
|
|
—
|
|
|
(172
|
)
|
|
|
||||
Add: Asset impairment
|
—
|
|
|
—
|
|
|
|
|
21
|
|
|
—
|
|
|
|
||||
Add: Lease termination expense
|
18
|
|
|
—
|
|
|
|
|
18
|
|
|
—
|
|
|
|
||||
Deduct: Net income tax impact from fuel and special items (1)
|
(114
|
)
|
|
(22
|
)
|
|
|
|
(110
|
)
|
|
(72
|
)
|
|
|
||||
Net income, non-GAAP
|
$
|
582
|
|
|
$
|
623
|
|
|
(6.6)%
|
|
$
|
1,907
|
|
|
$
|
1,764
|
|
|
8.1%
|
Net income per share, diluted, as reported
|
$
|
0.62
|
|
|
$
|
0.88
|
|
|
|
|
$
|
2.70
|
|
|
$
|
2.45
|
|
|
|
Add (Deduct): Net impact to net income above from fuel contracts divided by dilutive shares
|
(0.11
|
)
|
|
0.13
|
|
|
|
|
(0.16
|
)
|
|
0.26
|
|
|
|
||||
Add (Deduct): Impact of special items
|
0.60
|
|
|
(0.04
|
)
|
|
|
|
0.62
|
|
|
0.04
|
|
|
|
||||
Deduct: Net income tax impact of fuel and special items (1)
|
(0.18
|
)
|
|
(0.03
|
)
|
|
|
|
(0.16
|
)
|
|
(0.12
|
)
|
|
|
||||
Net income per share, diluted, non-GAAP
|
$
|
0.93
|
|
|
$
|
0.94
|
|
|
(1.1)%
|
|
$
|
3.00
|
|
|
$
|
2.63
|
|
|
14.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses per ASM (cents)
|
|
11.73
|
¢
|
|
|
11.26
|
¢
|
|
|
|
|
11.17
|
¢
|
|
|
11.18
|
¢
|
|
|
Deduct: Fuel and oil expense divided by ASMs
|
(2.48
|
)
|
|
(2.58
|
)
|
|
|
|
(2.43
|
)
|
|
(2.68
|
)
|
|
|
||||
Deduct: Impact of special items
|
(0.99
|
)
|
|
(0.40
|
)
|
|
|
|
(0.35
|
)
|
|
(0.19
|
)
|
|
|
||||
Operating expenses per ASM, excluding Fuel and oil and special items (cents), non-GAAP
|
|
8.26
|
¢
|
|
|
8.28
|
¢
|
|
(0.2)%
|
|
|
8.39
|
¢
|
|
|
8.31
|
¢
|
|
1.0%
|
|
|
|
|
||||
|
Twelve Months Ended
|
|
Twelve Months Ended
|
||||
|
September 30, 2016
|
|
September 30, 2015
|
||||
Operating income, as reported
|
$
|
3,940
|
|
|
$
|
3,711
|
|
Special revenue adjustment (1)
|
—
|
|
|
(172
|
)
|
||
Union contract bonuses
|
495
|
|
|
204
|
|
||
Net impact from fuel contracts
|
(300
|
)
|
|
(142
|
)
|
||
Acquisition and integration costs
|
7
|
|
|
80
|
|
||
Litigation settlement
|
—
|
|
|
(37
|
)
|
||
Asset impairment
|
21
|
|
|
—
|
|
||
Lease termination expense
|
18
|
|
|
—
|
|
||
Operating income, non-GAAP
|
$
|
4,181
|
|
|
$
|
3,644
|
|
Net adjustment for aircraft leases (2)
|
115
|
|
|
113
|
|
||
Adjustment for fuel hedge accounting
|
(160
|
)
|
|
(94
|
)
|
||
Adjusted Operating income, non-GAAP
|
$
|
4,136
|
|
|
$
|
3,663
|
|
|
|
|
|
||||
Average invested capital (3)
|
$
|
11,764
|
|
|
$
|
11,011
|
|
Equity adjustment for hedge accounting
|
1,044
|
|
|
761
|
|
||
Adjusted average invested capital
|
$
|
12,808
|
|
|
$
|
11,772
|
|
|
|
|
|
||||
ROIC, pre-tax
|
32.3
|
%
|
|
31.1
|
%
|
1.
|
A one-time $172 million Special revenue adjustment in July 2015 due to the Agreement with Chase and the resulting change in accounting methodology. This increase to revenue represented a nonrecurring required acceleration of revenues associated with the adoption of ASU 2009-13;
|
2.
|
Expenses associated with the Company’s acquisition and integration of AirTran. Such expenses were primarily incurred during the acquisition and integration period of the two companies from 2011 through 2015 as a result of the Company’s acquisition of AirTran, which closed on May 2, 2011. The Company does not expect to incur any further acquisition and integration costs related to the AirTran acquisition and therefore, the exclusion of these expenses provides investors with a more applicable basis with which to compare results in future periods now that the integration process has been completed;
|
3.
|
A gain resulting from a litigation settlement received in January 2015. This cash settlement meaningfully lowered Other operating expenses during the applicable period and the Company does not expect a similar impact on its cost structure in the future;
|
4.
|
Union contract bonuses recorded for certain workgroups. As the bonuses would only be paid at ratification of the associated tentative agreement and would not represent an ongoing expense to the Company, management believes its results for the associated periods are more usefully compared if the impacts of ratification bonus amounts are excluded from results. Generally, union contract agreements cover a specified three- to five- year period, although such contracts officially never expire, and the agreed upon terms remain in place until a revised agreement is reached, which can be several years following the amendable date;
|
5.
|
A $21 million noncash impairment charge related to Newark slots as a result of the FAA announcement in April 2016 that Newark was being changed to a Level 2 schedule-facilitated airport from its previous designation as Level 3; and
|
6.
|
Lease termination costs totaling $18 million recorded during third quarter 2016 as a result of the Company acquiring four of its Boeing 737-300 aircraft off operating leases. The Company recorded the fair value of the aircraft, as well as the associated remaining obligations to the balance sheet as debt.
|
|
|
|
|
Average
Age (Yrs)
|
|
Number
of Aircraft
|
|
Number
Owned
|
|
Number
Leased
|
||||
Type
|
|
Seats
|
|
|
|
|
||||||||
737-300
|
|
137 or 143
|
|
22
|
|
|
95
|
|
(1)
|
64
|
|
|
31
|
|
737-700
|
|
143
|
|
12
|
|
|
490
|
|
|
397
|
|
|
93
|
|
737-800
|
|
175
|
|
2
|
|
|
129
|
|
|
122
|
|
|
7
|
|
Totals
|
|
|
|
12
|
|
|
714
|
|
|
583
|
|
|
131
|
|
•
|
the Company's network, schedule optimization, fleet, and capacity plans and expectations;
|
•
|
the Company’s plans and schedule for the replacement of its reservations system and expected benefits associated with the new system;
|
•
|
the Company’s labor agreements and negotiations;
|
•
|
the Company’s financial outlook and projected results of operations, including factors and assumptions underlying the Company’s projections;
|
•
|
the Company’s plans and expectations with respect to managing risk associated with changing jet fuel prices;
|
•
|
the Company's expectations with respect to liquidity and capital expenditures, including anticipated needs for, and sources of, funds;
|
•
|
the Company's assessment of market risks; and
|
•
|
the Company's plans and expectations related to legal proceedings.
|
•
|
changes in demand for the Company's services and other changes in consumer behavior;
|
•
|
the impact of economic conditions, fuel prices, and actions of competitors (including, without limitation, pricing, scheduling, and capacity decisions and consolidation and alliance activities) and other factors beyond the Company’s control on the Company's business decisions, plans, and strategies;
|
•
|
the Company's ability to timely and effectively implement, transition, and maintain the necessary information technology systems and infrastructure to support its operations and initiatives;
|
•
|
the Company's dependence on third parties, in particular with respect to its technology and fleet plans;
|
•
|
the Company’s ability to timely and effectively prioritize its initiatives and related expenditures;
|
•
|
the impact of labor matters on the Company’s business decisions, plans, strategies, and costs;
|
•
|
the impact of governmental regulations and other governmental actions related to the Company and its operations;
|
•
|
changes in the price of aircraft fuel, the impact of hedge accounting, and any changes to the Company's fuel hedging strategies and positions; and
|
•
|
other factors as set forth in the Company's filings with the Securities and Exchange Commission, including the detailed factors discussed under the heading “Risk Factors” in the Company's Annual Report on Form 10-K for the year ended December 31, 2015.
|
Issuer Purchases of Equity Securities (1)
|
|
||||||||||||||
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
||||||
|
|
|
|
|
|
Total number of
shares purchased
as part of publicly
announced plans
or programs
|
|
Maximum dollar
value of shares that
may yet be purchased
under the plans
or programs
|
|
||||||
|
|
|
|
|
|
|
|
||||||||
|
|
Total number
of shares
purchased
|
|
Average
price paid
per share
|
|
|
|
||||||||
|
|
|
|
|
|
||||||||||
Period
|
|
|
|
|
|
||||||||||
July 1, 2016 through
July 31, 2016
|
|
—
|
|
|
$
|
—
|
|
(2)
|
—
|
|
|
$
|
1,250,000,000
|
|
(2)
|
August 1, 2016 through
August 31, 2016
|
|
4,956,384
|
|
|
$
|
—
|
|
(2)
|
4,956,384
|
|
|
$
|
1,250,000,000
|
|
|
September 1, 2016 through
September 30, 2016
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
1,250,000,000
|
|
|
Total
|
|
4,956,384
|
|
|
|
|
4,956,384
|
|
|
|
|
(1)
|
On May 18, 2016, the Company’s Board of Directors authorized the repurchase of up to $2.0 billion of the Company’s common stock. Repurchases are made in accordance with applicable securities laws in open market, private, or accelerated repurchase transactions from time to time, depending on market conditions, and may be discontinued at any time.
|
(2)
|
Under the Third Quarter 2016 ASR Program, the Company paid $250 million in July 2016 and received an initial delivery of 4,956,384 shares during August 2016, representing an estimated 75 percent of the shares to be purchased by the Company under the Third Quarter 2016 ASR Program based on a price of $37.83 per share, which was the closing price of the Company’s common stock on the New York Stock Exchange on July 22, 2016. Final settlement of this Third Quarter 2016 ASR Program occurred in October 2016 and was determined based generally on a discount to the volume-weighted average price per share of the Company's common stock during a calculation period completed in October 2016. Upon settlement, the third party financial institution delivered 1,709,877 additional shares of the Company’s common stock to the Company. In total, the average purchase price per share for the 6,666,261 shares repurchased under the Third Quarter 2016 ASR Program, upon completion of the Third Quarter 2016 ASR Program in October 2016, was $37.5023.
|
3.1
|
Restated Certificate of Formation of the Company, effective May 18, 2012 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (File No. 1-7259)).
|
3.2
|
Amended and Restated Bylaws of the Company, effective November 19, 2009 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed November 20, 2009 (File No. 1-7259)).
|
10.1
|
Supplemental Agreement No. 95 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.2
|
Supplemental Agreement No. 96 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.3
|
Supplemental Agreement No. 97 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.4
|
$1,000,000,000 Revolving Credit Facility Agreement among the Company, the Banks party thereto, Barclays Bank PLC, as Syndication Agent, Bank of America, N.A., BNP Paribas, Goldman Sachs Bank USA, Morgan Stanley Senior Funding, Inc., U.S. Bank National Association and Wells Fargo Bank, N.A., as Documentation Agents, JPMorgan Chase Bank, N.A. and Citibank, N.A., as Co-Administrative Agents and JPMorgan Chase Bank, N.A., as Paying Agent, dated as of August 3, 2016 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed August 9, 2016 (File No. 1-7259)).
|
10.5
|
Amended and Restated Southwest Airlines Co. 2005 Excess Benefit Plan (as amended and restated, effective as of March 1, 2016). (2)
|
10.6
|
Southwest Airlines Co. Deferred Compensation Plan for Senior Leadership and Non-Employee Members of the Southwest Airlines Co. Board of Directors (as amended and restated, effective as of March 1, 2016). (2)
|
31.1
|
Rule 13a-14(a) Certification of Chief Executive Officer.
|
31.2
|
Rule 13a-14(a) Certification of Chief Financial Officer.
|
32.1
|
Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer. (3)
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
SOUTHWEST AIRLINES CO.
|
|
|
|
|
October 31, 2016
|
By
|
/s/ Tammy Romo
|
|
|
|
|
|
Tammy Romo
|
|
|
Executive Vice President & Chief Financial Officer
|
|
|
(On behalf of the Registrant and in
|
|
|
her capacity as Principal Financial
|
|
|
and Accounting Officer)
|
3.1
|
Restated Certificate of Formation of the Company, effective May 18, 2012 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (File No. 1-7259)).
|
3.2
|
Amended and Restated Bylaws of the Company, effective November 19, 2009 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed November 20, 2009 (File No. 1-7259)).
|
10.1
|
Supplemental Agreement No. 95 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.2
|
Supplemental Agreement No. 96 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.3
|
Supplemental Agreement No. 97 to Purchase Agreement No. 1810, dated January 19, 1994, between The Boeing Company and the Company. (1)
|
10.4
|
$1,000,000,000 Revolving Credit Facility Agreement among the Company, the Banks party thereto, Barclays Bank PLC, as Syndication Agent, Bank of America, N.A., BNP Paribas, Goldman Sachs Bank USA, Morgan Stanley Senior Funding, Inc., U.S. Bank National Association and Wells Fargo Bank, N.A., as Documentation Agents, JPMorgan Chase Bank, N.A. and Citibank, N.A., as Co-Administrative Agents and JPMorgan Chase Bank, N.A., as Paying Agent, dated as of August 3, 2016 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed August 9, 2016 (File No. 1-7259)).
|
10.5
|
Amended and Restated Southwest Airlines Co. 2005 Excess Benefit Plan (as amended and restated, effective as of March 1, 2016). (2)
|
10.6
|
Southwest Airlines Co. Deferred Compensation Plan for Senior Leadership and Non-Employee Members of the Southwest Airlines Co. Board of Directors (as amended and restated, effective as of March 1, 2016). (2)
|
31.1
|
Rule 13a-14(a) Certification of Chief Executive Officer.
|
31.2
|
Rule 13a-14(a) Certification of Chief Financial Officer.
|
32.1
|
Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer. (3)
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
Supplemental Agreement No. 95
|
|
to
|
|
Purchase Agreement No. 1810
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-7H4 and 737-8H4 Aircraft
|
1.
|
TABLE OF CONTENTS
.
|
P.A. No. 1810
|
SA-95-1
|
|
|
BOEING PROPRIETARY
|
|
2.
|
TABLES
.
|
3.
|
LETTER AGREEMENTS
.
|
4.
|
***
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
By:
/s/ Jon W Lewis
|
By:
/s/ Chris Monroe
|
|
Chris Monroe
|
Its:
Attorney‑In‑Fact
|
Its:
VP, Treasurer
|
P.A. No. 1810
|
SA-95-2
|
|
BOEING PROPRIETARY
|
TABLE OF CONTENTS
|
||
|
Page
|
SA
|
|
Number
|
Number
|
ARTICLES
|
|
|
|
|
|
|
|
1.
|
Subject Matter of Sale
|
1-1
|
SA-92
|
|
|
|
|
2.
|
Delivery, Title and Risk
|
|
|
|
of Loss
|
2-1
|
SA-28
|
|
|
|
|
3.
|
Price of Aircraft
|
3‑1
|
SA-92
|
|
|
|
|
4.
|
Taxes
|
4-1
|
|
|
|
|
|
5.
|
Payment
|
5‑1
|
|
|
|
|
|
6.
|
Excusable Delay
|
6‑1
|
|
|
|
|
|
7.
|
Changes to the Detail
|
7-1
|
SA-73
|
|
Specification
|
|
|
|
|
8-1
|
|
8.
|
Federal Aviation Requirements and
|
|
|
|
Certificates and Export License
|
|
|
|
|
|
|
9.
|
Representatives, Inspection,
|
9-1
|
|
|
Flights and Test Data
|
|
|
|
|
|
|
10.
|
Assignment, Resale or Lease
|
10-1
|
|
|
|
|
|
11.
|
Termination for Certain Events
|
|
|
|
|
|
|
12.
|
Product Assurance; Disclaimer and
|
11‑1
|
|
|
Release; Exclusion of Liabilities;
|
|
|
|
Customer Support; Indemnification
|
|
|
|
and Insurance
|
12-1
|
|
|
|
|
|
13.
|
Buyer Furnished Equipment and
|
|
|
|
Spare Parts
|
13-1
|
|
|
|
|
|
14.
|
Contractual Notices and Requests
|
14‑1
|
|
|
|
|
|
15.
|
Miscellaneous
|
15‑1
|
|
|
|
|
|
P.A. No. 1810
|
i
|
|
K/SWA
|
|
SA-95
|
|
TABLE OF CONTENTS
|
|
|
|
SA
|
|
|
Number
|
TABLE
|
|
|
|
|
|
1b
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-82
|
|
|
|
1c
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-94
|
|
(non-ETOPS Configuration)
|
|
|
|
|
1d
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-95
|
|
(non-ETOPS Configuration)
|
|
EXHIBITS
|
|
|
|
|
|
A-6
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-75
|
|
|
|
A-7
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-84
|
|
(non-ETOPS Configuration)
|
|
|
|
|
B
|
***
|
SA-75
|
|
|
|
C
|
Customer Support Document
|
|
|
|
|
C-2
|
737-800 Customer Support Document
|
SA-75
|
|
|
|
D-2
|
Economic Price Adjustment
|
SA-75
|
|
ECI-MFG/CPI (July 2011 Base Price)
|
|
|
|
|
E
|
Buyer Furnished Equipment
|
SA-75
|
|
Provisions Document
|
|
|
Attachment A - 737-7H4 Aircraft (through 2012)
|
|
|
Attachment B - 737-8H4 Aircraft (2012-2018)
|
SA-92
|
|
|
|
F
|
Defined Terms Document
|
|
LETTER AGREEMENTS
|
|
|
|
|
|
1810-1R1
|
Waiver of Aircraft Demonstration Flight
|
SA-75
|
P.A. No. 1810
|
ii
|
|
K/SWA
|
|
SA-95
|
|
TABLE OF CONTENTS
|
|
|
|
SA
|
|
|
Number
|
RESTRICTED LETTER AGREEMENTS
|
|
|
|
|
|
6‑1162‑RLL‑932R3
|
***
|
SA-75
|
|
|
|
6‑1162‑RLL‑934R5
|
Disclosure of Confidential Information
|
SA-75
|
|
|
|
6‑1162‑RLL‑941R3
|
Other Matters
|
SA-75
|
|
|
|
6-1162-KJJ-055R1
|
Structural Matters
|
SA-25
|
|
|
|
6-1162-KJJ-056
|
Noise and Emission Matters
|
SA-13
|
|
|
|
6-1162-KJJ-057
|
Product Development Matters
|
SA-13
|
|
|
|
SWA-PA-1810-LA-1001315R4
|
***
|
SA-92
|
|
Attachment A
|
SA-94
|
|
|
|
SWA-PA-1810-LA-1003498R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1003490R4
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1003367R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1105883
|
Aircraft Model Substitution
|
SA-75
|
SWA-PA-1810-LA-1105884R2
|
Option Aircraft
|
SA-92
|
|
|
Attachment A - Model 737-8H4 Aircraft
|
SA-92
|
|
|
Attachment B - Option Aircraft Information Table
|
SA-95
|
|
|
|
|
|
SWA-PA-1810-LA-1105885R3
|
|
***
|
SA-90
|
|
|
|
|
SWA-PA-1810-LA-1105886R2
|
|
***
|
SA-92
|
|
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105887
|
|
***
|
SA-75
|
|
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105888R5
|
|
***
|
SA-92
|
|
|
|
|
SWA-PA-1810-LA-1105889
|
|
***
|
SA-75
|
|
|
|
|
SWA-PA-1810-LA-1303010R1
|
|
***
|
SA-92
|
|
|
|
|
SWA-PA-1810-LA-1504814
|
|
***
|
SA-92
|
P.A. No. 1810
|
iii
|
|
K/SWA
|
|
SA-95
|
TABLE OF CONTENTS
|
ADDITIONAL LETTERS (FOR REFERENCE) -
INACTIVE (as of SA-82)
|
||||
6-1162-MSA-288
|
Business Offer - Enhanced Ground Proximity
|
|||
|
Warning System (EGPWS) - Activiation - Peaks
|
|||
|
and Obstacles Feature
|
|||
|
(
Not applicable to Block 700LUV & Block 800LUV Aircraft)
|
|||
|
|
|||
6-1162-JMG-501R2
|
Business Offer - ACARS package
|
|||
|
(
Not applicable to Block 700LUV & Block 800LUV
|
|||
|
Aircraft)
|
TABLE
|
|
|
|
|
|
|
|
Table
|
Title
|
Last Updated under SA
|
Current Status
|
1
|
Aircraft Information Table
|
SA-75
|
Inactive
|
2
|
Option Aircraft Information Table
|
SA-74
|
Deleted under SA-75
|
1a
|
Aircraft Information Table - Block 700LUV Aircraft
|
SA-91
|
Deleted Under SA-92
|
EXHIBITS
|
|
|
|
|
|
|
|
Exhibits
|
Title
|
Last Updated under SA
|
Current Status
|
A
|
Aircraft Configuration - 737-700
|
SA-36
|
Inactive
|
A-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1A
|
Aircraft Configuration - 737-700 Block T-W-2c
|
SA-36
|
Inactive
|
A-2
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-47
|
Inactive
|
A-3
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-61
|
Inactive
|
A-4
|
Aircraft Configuration - 737-700 Block T-W-2b Aircraft
|
SA-66
|
Inactive
|
A-5
|
Aircraft Configuration - Block 700LUV Aircraft
|
SA-75
|
Deleted under SA-92
|
C.2
|
737-800 Customer Support Variables
|
SA-71
|
Deleted under SA-75
|
D
|
Price Adjustment Due to
Economic Fluctuations - Aircraft Price Adjustment
(July 1992 Base Price)
|
|
Inactive
|
D-1
|
Price Adjustment Due to Economic Fluctuations -
|
SA-13
|
Inactive
|
P.A. No. 1810
|
iv
|
|
K/SWA
|
|
SA-95
|
TABLE OF CONTENTS
|
Exhibits
|
Title
|
Last Updated under SA
|
Current Status
|
|
Aircraft Price Adjustment (July 1999 Base Price)
|
|
|
E.2
|
737-800 Buyer Furnished Equipment Provisions Document
|
SA-73
|
Deleted under SA-75
|
RESTRICTED LETTER AGREEMENTS
|
|
|
|
|
|
|
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
6‑1162‑RLL‑933R21
|
Option Aircraft
|
SA-60
|
Deleted under SA-75
|
6‑1162‑RLL‑935R1
|
Performance Guarantees
|
SA-1
|
Inactive
|
6‑1162‑RLL‑936R4
|
Certain Contractual Matters
|
SA-4
|
Inactive
|
6‑1162‑RLL‑937
|
Alternate Advance Payment Schedule
|
|
Inactive
|
6‑1162‑RLL‑938
|
***
|
|
Inactive
|
6‑1162‑RLL‑939R1
|
Certification Flight Test Aircraft
|
SA-1
|
Inactive
|
6‑1162‑RLL‑940R1
|
Training Matters
|
SA-1
|
Inactive
|
6‑1162‑RLL‑942
|
Open Configuration Matters
|
|
Inactive
|
6‑1162‑RLL‑943R1
|
Substitution Rights
|
SA-6
|
Deleted under SA 75
|
6‑1162‑RLL‑944
|
***
|
|
Inactive
|
6-1162-RLL-945
|
Comparison of 737-7H4 and 737-3H4 Block Fuel Burn
|
|
Inactive
|
6-1162-RLL-1855R3
|
Additional Contractual Matters
|
SA-4
|
Inactive
|
6-1162-RLL-1856
|
***
|
SA-1
|
Inactive
|
6-1162-RLL-1857
|
Service Ready Validation Program Field Test
|
SA-1
|
Inactive
|
6-1162-RLL-1858R1
|
Escalation Matters
|
SA-4
|
Inactive
|
6-1162-RLL-2036
|
Amortization of Costs for Customer Unique Changes
|
SA-1
|
Inactive
|
6-1162-RLL-2037
|
Reconciliation of the Aircraft Basic Price
|
SA-1
|
Inactive
|
6-1162-RLL-2073
|
Maintenance Training Matters
|
SA-1
|
Inactive
|
6-1162-KJJ-058R1
|
Additional Substitution Rights
|
SA-71
|
Deleted under SA-75
|
6-1162-KJJ-150
|
Flight Control Computer & Mode Control Panel Spares Matter
|
SA-14
|
Inactive
|
6-1162-MSA-185R3
|
Delivery Change Contractual Matters
|
SA-21
|
Inactive
|
P.A. No. 1810
|
v
|
|
K/SWA
|
|
SA-95
|
TABLE OF CONTENTS
|
P.A. No. 1810
|
vi
|
|
K/SWA
|
|
SA-95
|
Table 1d to
|
Purchase Agreement No. PA-01810
|
Aircraft Delivery, Description, Price and Advance Payments
|
Block 800LUV Aircraft (non-ETOPS Configuration)
|
Airframe Model/MTOW:
|
737-800
|
174,200 pounds
|
|
Detail Specification:
|
D019A001SWA38 (1/9/2015)
|
||
Engine Model/Thrust:
|
CFM56-7B27
|
27,300 pounds
|
|
Base Aircraft Price Base Year/Escalation Formula:
|
Jul-11
|
ECI-MFG/CPI
|
|
Airframe Price:
|
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
N/A
|
N/A
|
|
Optional Features:
|
***
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
***
|
|
|
|
|
|
|
Engine Price (Per Aircraft):
|
***
|
|
Aircraft Price Escalation Data:
|
|
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
***
|
|
Base Year Index (ECI):
|
***
|
|
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
***
|
|
Base Year Index (CPI):
|
***
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
***
|
|
|
|
|
|
|
Deposit per Exercised Option Aircraft (OPEX):
|
***
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation Forecast |
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Dec-2016
|
2
|
***
|
63593, 63594
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63592
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
1
|
***
|
63571
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
2
|
***
|
63595, 63596
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
1
|
***
|
63587
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
63586
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
5
|
***
|
63572, 63573,
63574, 63575,
63576
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
3
|
***
|
63577, 63578,
63579
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63,597
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
2
|
***
|
63580, 63581
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
2
|
***
|
63598, 63599
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-
95
|
SWA-PA-01810 82233 /
88233
|
Boeing Proprietary
|
Page 1
|
Table 1d to
Purchase Agreement No. PA-01810
Aircraft Delivery, Description, Price and Advance Payments
Block 800LUV Aircraft (non-ETOPS Configuration)
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Dec-2017
|
2
|
***
|
63582, 63583
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
4
|
***
|
63600, 63601,
63602, 36993
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
1
|
***
|
64115
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
2
|
***
|
63584, 63585
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
63588, 63589
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
63590, 63591
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
|
|
|
|
1) ***
|
|
|
|
|
|
|
|
|
|
|
|
|
SA-
95
|
SWA-PA-01810 82233 /
88233
|
Boeing Proprietary
|
Page 2
|
Attachment B To
|
Letter Agreement SWA-PA-1810-LA-1105884R2
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
|
|
Airframe Model/MTOW:
|
737-800
|
174,200 pounds
|
|
Detail Specification:
|
D019A001SWA38 (1/9/2015)
|
||
|
|
|
|
|
|
|
|
Engine Model/Thrust:
|
CFM56-7B27
|
27,300 pounds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Airframe Price:
|
|
***
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-11
|
|
ECI-MFG/CPI
|
Optional Features Estimate:
|
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
N/A
|
|
N/A
|
Sub-Total of Airframe and Features:
|
|
***
|
|
Airframe Escalation Data:
|
|
|
|
Engine Price (Per Aircraft):
|
|
***
|
|
Base Year Index (ECI):
|
|
***
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
|
***
|
|
Base Year Index (CPI):
|
|
***
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
|
***
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
|
***
|
|
|
|
|
|
Deposit per Aircraft:
|
|
***
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise
Date
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
||||||
Feb-2018
|
2
|
***
|
8/1/2016
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
9/1/2016
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
1
|
***
|
10/1/2016
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
11/1/2016
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
12/1/2016
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
2
|
***
|
1/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
2/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2018
|
1
|
***
|
3/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2018
|
1
|
***
|
4/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2018
|
1
|
***
|
5/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
1
|
***
|
6/1/2017
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
17
|
|
|
|
|
|
|
|
|
|
|
SA-
95
|
SWA-PA-01810 82233-1F.TXT
|
Boeing Proprietary
|
Page 1
|
Supplemental Agreement No. 96
|
|
to
|
|
Purchase Agreement No. 1810
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-7H4 and 737-8H4 Aircraft
|
RECITALS
:
|
1.
|
TABLE OF CONTENTS
.
|
P.A. No. 1810
|
SA-96-
1
|
|
|
BOEING PROPRIETARY
|
|
2.
|
TABLES
.
|
3.
|
LETTER AGREEMENTS
.
|
4.
|
***
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
By:
/s/ Jon W. Lewis
|
By:
/s/ Chris Monroe
|
|
Chris Monroe
|
Its:
Attorney‑In‑Fact
|
Its:
VP, Treasurer
|
P.A. No. 1810
|
SA-96-
2
|
|
|
BOEING PROPRIETARY
|
|
|
TABLE OF CONTENTS
|
|
|
|
|
Page
Number
|
SA
Number
|
|
|
|
|
ARTICLES
|
|
|
|
|
|
|
|
1.
|
Subject Matter of Sale
|
1-1
|
SA-92
|
|
|
|
|
2.
|
Delivery, Title and Risk
|
|
|
|
of Loss
|
2-1
|
SA-28
|
|
|
|
|
3.
|
Price of Aircraft
|
3‑1
|
SA-92
|
|
|
|
|
4.
|
Taxes
|
4-1
|
|
|
|
|
|
5.
|
Payment
|
5‑1
|
|
|
|
|
|
6.
|
Excusable Delay
|
6‑1
|
|
|
|
|
|
7.
|
Changes to the Detail
|
|
|
|
Specification
|
7-1
|
SA-73
|
|
|
|
|
8.
|
Federal Aviation Requirements and
|
|
|
|
Certificates and Export License
|
8-1
|
|
|
|
|
|
9.
|
Representatives, Inspection,
|
|
|
|
Flights and Test Data
|
9-1
|
|
|
|
|
|
10.
|
Assignment, Resale or Lease
|
10‑1
|
|
|
|
|
|
11.
|
Termination for Certain Events
|
11‑1
|
|
|
|
|
|
12.
|
Product Assurance; Disclaimer and
|
|
|
|
Release; Exclusion of Liabilities;
|
|
|
|
Customer Support; Indemnification
|
|
|
|
and Insurance
|
12-1
|
|
|
|
|
|
13.
|
Buyer Furnished Equipment and
|
|
|
|
Spare Parts
|
13-1
|
|
|
|
|
|
14.
|
Contractual Notices and Requests
|
14‑1
|
|
|
|
|
|
15.
|
Miscellaneous
|
15‑1
|
|
P.A. No. 1810
|
i
|
|
K/SWA
|
|
SA-
96
|
|
TABLE OF CONTENTS
|
|
|
|
SA
Number
|
|
|
|
|
|
|
TABLE
|
|
|
1b
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-82
|
|
|
|
1c
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-96
|
|
(non-ETOPS Configuration)
|
|
|
|
|
1d
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-96
|
|
(non-ETOPS Configuration)
|
|
EXHIBITS
|
|
|
|
|
|
A-6
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-75
|
|
|
|
A-7
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-84
|
|
(non-ETOPS Configuration)
|
|
|
|
|
B
|
***
|
SA-75
|
|
|
|
C
|
Customer Support Document
|
|
|
|
|
C-2
|
737-800 Customer Support Document
|
SA-75
|
|
|
|
D-2
|
Economic Price Adjustment
|
SA-75
|
|
ECI-MFG/CPI (July 2011 Base Price)
|
|
|
|
|
E
|
Buyer Furnished Equipment
|
SA-75
|
|
Provisions Document
|
|
|
Attachment A - 737-7H4 Aircraft (through 2012)
|
|
|
Attachment B - 737-8H4 Aircraft (2012-2018)
|
SA-92
|
|
|
|
F
|
Defined Terms Document
|
|
LETTER AGREEMENTS
|
|
|
|
|
|
1810-1R1
|
Waiver of Aircraft Demonstration Flight
|
SA-75
|
P.A. No. 1810
|
ii
|
|
K/SWA
|
|
SA-
96
|
|
TABLE OF CONTENTS
|
|
|
|
|
|
|
SA
Number
|
|
|
|
RESTRICTED LETTER AGREEMENTS
|
|
|
|
|
|
6‑1162‑RLL‑932R3
|
***
|
SA-75
|
|
|
|
6‑1162‑RLL‑934R5
|
Disclosure of Confidential Information
|
SA-75
|
|
|
|
6‑1162‑RLL‑941R3
|
Other Matters
|
SA-75
|
|
|
|
6-1162-KJJ-055R1
|
Structural Matters
|
SA-25
|
|
|
|
6-1162-KJJ-056
|
Noise and Emission Matters
|
SA-13
|
|
|
|
6-1162-KJJ-057
|
Product Development Matters
|
SA-13
|
|
|
|
SWA-PA-1810-LA-1001315R4
|
***
|
SA-92
|
|
Attachment A
|
SA-94
|
|
|
|
SWA-PA-1810-LA-1003498R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1003490R4
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1003367R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1105883
|
Aircraft Model Substitution
|
SA-75
|
SWA-PA-1810-LA-1105884R2
|
Option Aircraft
|
SA-92
|
|
|
Attachment A - Model 737-8H4 Aircraft
|
SA-92
|
|
|
Attachment B - Option Aircraft Information Table
|
SA-96
|
SWA-PA-1810-LA-1105885R3
|
***
|
SA-90
|
|
|
|
SWA-PA-1810-LA-1105886R2
|
***
|
SA-92
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105887
|
***
|
SA-75
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105888R5
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1105889
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1303010R1
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1504814
|
***
|
SA-92
|
P.A. No. 1810
|
iii
|
|
K/SWA
|
|
SA-
96
|
ADDITIONAL LETTERS (FOR REFERENCE) -
INACTIVE (as of SA-82)
|
|
6-1162-MSA-288
|
Business Offer - Enhanced Ground Proximity
|
|
Warning System (EGPWS) - Activiation - Peaks
|
|
and Obstacles Feature
|
|
(
Not applicable to Block 700LUV & Block 800LUV Aircraft)
|
|
|
6-1162-JMG-501R2
|
Business Offer - ACARS package
|
|
(
Not applicable to Block 700LUV & Block 800LUV Aircraft)
|
Table
|
Last Updated under SA
|
Current Status
|
|
1
|
Aircraft Information Table
|
SA-75
|
Inactive
|
2
|
Option Aircraft Information Table
|
SA-74
|
Deleted under SA-75
|
1a
|
Aircraft Information Table - Block 700LUV Aircraft
|
SA-91
|
Deleted Under SA-92
|
Exhibits
|
Last Updated under SA
|
Current Status
|
|
A
|
Aircraft Configuration - 737-700
|
SA-36
|
Inactive
|
A-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1A
|
Aircraft Configuration - 737-700 Block T-W-2c
|
SA-36
|
Inactive
|
A-2
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-47
|
Inactive
|
A-3
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-61
|
Inactive
|
A-4
|
Aircraft Configuration - 737-700 Block T-W-2b Aircraft
|
SA-66
|
Inactive
|
A-5
|
Aircraft Configuration - Block 700LUV Aircraft
|
SA-75
|
Deleted under SA-92
|
C.2
|
737-800 Customer Support Variables
|
SA-71
|
Deleted under SA-75
|
D
|
Price Adjustment Due to
Economic Fluctuations -
Aircraft Price Adjustment
(July 1992 Base Price)
|
|
Inactive
|
D-1
|
Price Adjustment Due to Economic Fluctuations -
|
SA-13
|
Inactive
|
P.A. No. 1810
|
iv
|
|
K/SWA
|
|
SA-
96
|
|
Aircraft Price Adjustment
(July 1999 Base Price)
|
|
|
E.2
|
737-800 Buyer Furnished Equipment Provisions Document
|
SA-73
|
Deleted under SA-75
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
6‑1162‑RLL‑933R21
|
Option Aircraft
|
SA-60
|
Deleted under SA-75
|
6‑1162‑RLL‑935R1
|
Performance Guarantees
|
SA-1
|
Inactive
|
6‑1162‑RLL‑936R4
|
Certain Contractual Matters
|
SA-4
|
Inactive
|
6‑1162‑RLL‑937
|
Alternate Advance Payment Schedule
|
|
Inactive
|
6‑1162‑RLL‑938
|
***
|
|
Inactive
|
6‑1162‑RLL‑939R1
|
Certification Flight Test Aircraft
|
SA-1
|
Inactive
|
6‑1162‑RLL‑940R1
|
Training Matters
|
SA-1
|
Inactive
|
6‑1162‑RLL‑942
|
Open Configuration Matters
|
|
Inactive
|
6‑1162‑RLL‑943R1
|
Substitution Rights
|
SA-6
|
Deleted under SA 75
|
6‑1162‑RLL‑944
|
***
|
|
Inactive
|
6-1162-RLL-945
|
Comparison of 737-7H4 and 737-3H4 Block Fuel Burn
|
|
Inactive
|
6-1162-RLL-1855R3
|
Additional Contractual Matters
|
SA-4
|
Inactive
|
6-1162-RLL-1856
|
***
|
SA-1
|
Inactive
|
6-1162-RLL-1857
|
Service Ready Validation Program Field Test
|
SA-1
|
Inactive
|
6-1162-RLL-1858R1
|
Escalation Matters
|
SA-4
|
Inactive
|
6-1162-RLL-2036
|
Amortization of Costs for Customer Unique Changes
|
SA-1
|
Inactive
|
6-1162-RLL-2037
|
Reconciliation of the Aircraft Basic Price
|
SA-1
|
Inactive
|
6-1162-RLL-2073
|
Maintenance Training Matters
|
SA-1
|
Inactive
|
6-1162-KJJ-058R1
|
Additional Substitution Rights
|
SA-71
|
Deleted under SA-75
|
6-1162-KJJ-150
|
Flight Control Computer & Mode Control Panel Spares Matter
|
SA-14
|
Inactive
|
6-1162-MSA-185R3
|
Delivery Change Contractual Matters
|
SA-21
|
Inactive
|
6-1162-JMG-747R1
|
***
|
SA-36
|
Inactive
|
6-1162-CHL-217
|
Rescheduled Flight Test Aircraft
|
SA-32
|
Inactive
|
P.A. No. 1810
|
v
|
|
K/SWA
|
|
SA-
96
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
|
Aircraft
|
|
|
6-1162-NIW-606R1
|
***
|
SA-36
|
Inactive
|
6-1162-NIW-640
|
Early Delivery of Two April 2004 Aircraft
|
SA-35
|
Inactive
|
6-1162-NIW-889
|
Warranty - Exterior Color Schemes and Markings for YA143 and on
|
SA-39
|
Inactive
|
6-1162-NIW-1142
|
***
|
SA-43
|
Inactive
|
6-1162-NIW-1369
|
***
|
SA-46
|
Inactive
|
6-1162-NIW-1983
|
***
|
SA-62
|
Inactive
|
SWA-PA-1810-LA-1000419
|
***
|
SA-64
|
Inactive
|
6-1162-NIW-890R1
|
***
|
SA-75
SA-39
|
Inactive
|
6-1162-KJJ-054R2
|
Business Matters
|
SA-75
|
Inactive
|
6-1162-JMG-669R9
|
***
|
SA-75
SA-75
SA-54
|
Inactive
|
SWA-PA-1810-LA-02710R1
|
***
|
SA-72
|
Inactive
|
SWA-PA-01810/03729-LA-1301169
|
***
|
SA-2 to PA 3729
|
Inactive
|
P.A. No. 1810
|
vi
|
|
K/SWA
|
|
SA-
96
|
Airframe Model/MTOW:
|
737-800
|
|
174200 pounds
|
|
|
Detail Specification:
|
D019A001SWA38P-1 Rev C (3/29/2013)
|
|
Engine Model/Thrust:
|
CFM56-7B27
|
|
27300 pounds
|
|
Note 1
|
Airframe Price Base Year/Escalation Formula:
|
Jul-11
|
ECI-MFG/CPI
|
Base Airframe Price:
|
|
|
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
N/A
|
N/A
|
Special Features:
|
|
***
|
|
|
|
|
|
|
Add'l Features/Changes
|
|
***
|
|
|
|
Airframe Escalation Data:
|
|
|
Total Special Features (Exhibit A-7)
|
|
|
|
***
|
|
Base Year Index (ECI):
|
|
***
|
Sub-Total of Airframe and Features:
|
|
|
|
***
|
|
Base Year Index (CPI):
|
|
***
|
Engine Price (Per Aircraft):
|
|
|
|
***
|
|
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
|
|
|
***
|
|
|
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
|
|
|
***
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
|
|
|
***
|
|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
Sub-Block
Note 2
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Sep-2013
|
3
|
***
|
36933, 36912, 36914
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2013
|
3
|
***
|
36915, 33939, 42526
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2013
|
3
|
***
|
36917, 36919, 36731
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2014
|
2
|
***
|
37004, 36896
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2014
|
3
|
***
|
42384, 36894, 36895
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2014
|
3
|
***
|
36897, 42385, 42521
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2014
|
4
|
***
|
36898, 36905, 42522, 42523
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2014
|
2
|
***
|
60082, 60083
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jul-2014
|
1
|
***
|
36,911
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2014
|
3
|
***
|
60084, 60085, 60086
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2014
|
4
|
***
|
36907, 42525, 36935, 42528
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2014
|
2
|
***
|
42527, 42531
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2014
|
1
|
***
|
36,909
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2014
|
1
|
***
|
36,920
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2014
|
1
|
***
|
36,971
|
***
|
|
***
|
***
|
***
|
***
|
***
|
SWA-PA-01810
|
|
SA-
96
|
63879 / 63887 / 64110 / 64111 / 66379
/
68788
/
70150 / 73631 / 82233 / 88233
|
Boeing Proprietary
|
Page
1
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
Sub-Block
Note 2
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Dec-2014
|
2
|
***
|
37037, 37045
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2014
|
2
|
***
|
42529, 42530
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2014
|
2
|
***
|
42524, 35973
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2015
|
2
|
***
|
36899, 42535
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2015
|
3
|
***
|
36901, 36654, 36906
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2015
|
2
|
***
|
36902, 36936
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2015
|
2
|
***
|
36649, 36652
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2015
|
2
|
***
|
36903, 36657
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2015
|
2
|
***
|
36655, 36656
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2015
|
3
|
***
|
36937, 36715, 36940
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2015
|
3
|
***
|
36941, 36734, 35976
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2016
|
2
|
***
|
36650, 36735
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2016
|
3
|
***
|
36904, 36932, 36737
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2016
|
2
|
***
|
36651, 36738
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2016
|
1
|
***
|
36,653
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2016
|
5
|
***
|
36658, 36939, 33937, 36938,
36723
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2016
|
1
|
***
|
36,916
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2016
|
3
|
***
|
36921, 36945, 33942
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2016
|
4
|
***
|
36678, 36661, 35965, 36728
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2016
|
4
|
***
|
36977, 36923, 41530,
36666
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2016
|
2
|
***
|
38812, 38813
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2016
|
3
|
***
|
36670, 38814, 41531
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2016
|
2
|
***
|
36925, 36944
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2016
|
1
|
***
|
38,816
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2016
|
3
|
***
|
36975, 36943, 36976
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2017
|
2
|
***
|
42532, 36910
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2017
|
3
|
***
|
36969, 36970, 36922
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2017
|
3
|
***
|
36972, 36949, 36946
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2017
|
2
|
***
|
36974, 36927
|
***
|
|
***
|
***
|
***
|
***
|
***
|
SWA-PA-01810
|
|
SA-
96
|
63879 / 63887 / 64110 / 64111 / 66379
/
68788
/
70150 / 73631 / 82233 / 88233
|
Boeing Proprietary
|
Page
2
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
Sub-Block
Note 2
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Aug-2017
|
1
|
***
|
36,926
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
3
|
***
|
36951, 36968, 42534
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2018
|
2
|
***
|
42545, 42533
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
36928
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
2
|
***
|
36952, 36954
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
1
|
***
|
36957
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
|
|
|
|
|
|
|
|
|
Total:
|
117
|
|
|
|
|
|
|
|
|
|
SWA-PA-01810
|
|
SA-
96
|
63879 / 63887 / 64110 / 64111 / 66379
/
68788
/
70150 / 73631 / 82233 / 88233
|
Boeing Proprietary
|
Page
3
|
Airframe Model/MTOW:
|
737-800
|
174,200 pounds
|
|
Detail Specification:
|
|
D019A001SWA38 (1/9/2015)
|
|
||
Engine Model/Thrust:
|
CFM56-7B27
|
27,300 pounds
|
|
Airframe Price Base Year/Escalation Formula:
|
|
Jul-11
|
|
ECI-MFG/CPI
|
|
Airframe Price:
|
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
|
N/A
|
|
N/A
|
|
Optional Features:
|
|
***
|
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
|
***
|
|
Airframe Escalation Data:
|
|
|
|
|
|
Engine Price (Per Aircraft):
|
|
***
|
|
Base Year Index (ECI):
|
|
|
***
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
|
***
|
|
Base Year Index (CPI
|
|
|
***
|
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
|
***
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
|
***
|
|
|
|
|
|
|
|
Deposit per Exercised Option Aircraft (OPEX):
|
|
***
|
|
|
|
|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Dec-2016
|
2
|
***
|
63593, 63594
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63592
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63575
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
3
|
***
|
63576, 63577,
63578
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
1
|
***
|
63571
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
2
|
***
|
63595, 63596
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
1
|
***
|
63587
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
63586
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
3
|
***
|
63572, 63573,
63574
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63579
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63597
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
2
|
***
|
63580, 63581
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
|
|
|
SA-
96
|
SWA-PA-01810 82233 / 88233
|
Boeing Proprietary
|
Page
1
|
|
Table 1d to
|
|
|
Purchase Agreement No. PA-01810
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
Block 800LUV Aircraft (non-ETOPS Configuration)
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Nov-2017
|
2
|
***
|
63598, 63599
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
2
|
***
|
63582, 63583
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
4
|
***
|
63600, 63601,
63602, 36993
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
1
|
***
|
64,115
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
2
|
***
|
63584, 63585
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2018
|
2
|
***
|
64171, 64172
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
63588, 63589
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
63590, 63591
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SA-
96
|
SWA-PA-01810 82233 / 88233
|
Boeing Proprietary
|
Page
2
|
|
Attachment B To
|
|
|
Letter Agreement SWA-PA-1810-LA-1105884R2
|
|
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
Airframe Model/MTOW:
|
737-800
|
|
174,200 pounds
|
|
Detail Specification:
|
D019A001SWA38 (1/9/2015)
|
||
Engine Model/Thrust:
|
CFM56-7B27
|
|
27,300 pounds
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-11
|
|
ECI-MFG/CPI
|
Airframe Price:
|
|
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
N/A
|
|
|
Optional Features Estimate:
|
|
|
***
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
|
|
***
|
|
Airframe Escalation Data:
|
|
|
|
Engine Price (Per Aircraft):
|
|
|
***
|
|
Base Year Index (ECI):
|
|
***
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
|
|
***
|
|
Base Year Index (CPI):
|
|
***
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
|
|
***
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
|
|
***
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
|
***
|
|
|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise
Date
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
||||||
Mar-2018
|
1
|
***
|
9/1/16
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
1
|
***
|
10/1/16
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
11/1/16
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
12/1/16
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
2
|
***
|
1/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
2/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2018
|
1
|
***
|
3/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2018
|
1
|
***
|
4/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2018
|
1
|
***
|
5/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
1
|
***
|
6/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
15
|
|
|
|
|
|
|
|
|
|
|
SA-
96
|
SWA-PA-01810 82233-1F.TXT
|
BOEING PROPRIETARY
|
Page 1
|
Supplemental Agreement No. 97
|
|
to
|
|
Purchase Agreement No. 1810
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-7H4 and 737-8H4 Aircraft
|
1.
|
TABLE OF CONTENTS
.
|
P.A. No. 1810
|
SA-97-
1
BOEING PROPRIETARY
|
|
2.
|
TABLES
.
|
3.
|
LETTER AGREEMENTS
.
|
4.
|
***
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
By:
/s/ Jon W. Lewis
|
By:
/s/ Chris Monroe
|
|
Chris Monroe
|
Its:
Attorney‑In‑Fact
|
Its:
VP, Treasurer
|
|
|
P.A. No. 1810
|
SA-97-
2
BOEING PROPRIETARY
|
|
|
TABLE OF CONTENTS
|
|
|
|
|
|
Page
Number
|
|
SA
Number
|
|
|
|
|
|
ARTICLES
|
|
|
|
|
|
|
|
|
|
1.
|
Subject Matter of Sale
|
1-1
|
|
SA-92
|
|
|
|
|
|
2.
|
Delivery, Title and Risk
|
|
|
|
|
of Loss
|
2-1
|
|
SA-28
|
|
|
|
|
|
3.
|
Price of Aircraft
|
3‑1
|
|
SA-92
|
|
|
|
|
|
4.
|
Taxes
|
4-1
|
|
|
|
|
|
|
|
5.
|
Payment
|
5‑1
|
|
|
|
|
|
|
|
6.
|
Excusable Delay
|
6‑1
|
|
|
|
|
|
|
|
7.
|
Changes to the Detail
|
|
|
|
|
Specification
|
7-1
|
|
SA-73
|
|
|
|
|
|
8.
|
Federal Aviation Requirements and
|
|
|
|
|
Certificates and Export License
|
8-1
|
|
|
|
|
|
|
|
9.
|
Representatives, Inspection,
|
|
|
|
|
Flights and Test Data
|
9-1
|
|
|
|
|
|
|
|
10.
|
Assignment, Resale or Lease
|
10‑1
|
|
|
|
|
|
|
|
11.
|
Termination for Certain Events
|
11‑1
|
|
|
|
|
|
|
|
12.
|
Product Assurance; Disclaimer and
|
|
|
|
|
Release; Exclusion of Liabilities;
|
|
|
|
|
Customer Support; Indemnification
|
|
|
|
|
and Insurance
|
12-1
|
|
|
|
|
|
|
|
13.
|
Buyer Furnished Equipment and
|
|
|
|
|
Spare Parts
|
13-1
|
|
|
|
|
|
|
|
14.
|
Contractual Notices and Requests
|
14‑1
|
|
|
|
|
|
|
|
15.
|
Miscellaneous
|
15‑1
|
|
|
P.A. No. 1810
|
i
|
|
K/SWA
|
|
SA-
97
|
|
TABLE OF CONTENTS
|
|
|
|
SA
Number
|
|
|
|
|
|
|
TABLE
|
|
|
|
|
|
1b
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-82
|
|
|
|
1c
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-96
|
|
(non-ETOPS Configuration)
|
|
|
|
|
1d
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-97
|
|
(non-ETOPS Configuration)
|
|
EXHIBITS
|
|
|
|
|
|
A-6
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-75
|
|
|
|
A-7
|
Aircraft Configuration - Block 800LUV Aircraft
|
SA-84
|
|
(non-ETOPS Configuration)
|
|
|
|
|
B
|
***
|
SA-75
|
|
|
|
C
|
Customer Support Document
|
|
|
|
|
C-2
|
737-800 Customer Support Document
|
SA-75
|
|
|
|
D-2
|
Economic Price Adjustment
|
SA-75
|
|
ECI-MFG/CPI (July 2011 Base Price)
|
|
|
|
|
E
|
Buyer Furnished Equipment
|
SA-75
|
|
Provisions Document
|
|
|
Attachment A - 737-7H4 Aircraft (through 2012)
|
|
|
Attachment B - 737-8H4 Aircraft (2012-2018)
|
SA-92
|
|
|
|
F
|
Defined Terms Document
|
|
1810-1R1
|
Waiver of Aircraft Demonstration Flight
|
SA-75
|
P.A. No. 1810
|
ii
|
|
K/SWA
|
|
SA-
97
|
|
TABLE OF CONTENTS
|
|
6‑1162‑RLL‑932R3
|
***
|
SA-75
|
|
|
|
6‑1162‑RLL‑934R5
|
Disclosure of Confidential Information
|
SA-75
|
|
|
|
6‑1162‑RLL‑941R3
|
Other Matters
|
SA-75
|
|
|
|
6-1162-KJJ-055R1
|
Structural Matters
|
SA-25
|
|
|
|
6-1162-KJJ-056
|
Noise and Emission Matters
|
SA-13
|
|
|
|
6-1162-KJJ-057
|
Product Development Matters
|
SA-13
|
SWA-PA-1810-LA-1001315R4
|
***
|
SA-92
|
|
Attachment A
|
SA-94
|
|
|
|
SWA-PA-1810-LA-1003498R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1003490R4
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1003367R1
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1105883
|
Aircraft Model Substitution
|
SA-75
|
SWA-PA-1810-LA-1105884R2
|
Option Aircraft
|
SA-92
|
|
Attachment A - Model 737-8H4 Aircraft
|
SA-92
|
|
Attachment B - Option Aircraft Information Table
|
SA-97
|
SWA-PA-1810-LA-1105885R3
|
***
|
SA-90
|
|
|
|
SWA-PA-1810-LA-1105886R2
|
***
|
SA-92
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105887
|
***
|
SA-75
|
|
|
|
|
|
|
SWA-PA-1810-LA-1105888R5
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1105889
|
***
|
SA-75
|
|
|
|
SWA-PA-1810-LA-1303010R1
|
***
|
SA-92
|
|
|
|
SWA-PA-1810-LA-1504814
|
***
|
SA-92
|
P.A. No. 1810
|
iii
|
|
K/SWA
|
|
SA-
97
|
ADDITIONAL LETTERS (FOR REFERENCE) -
INACTIVE (as of SA-82)
|
|
6-1162-MSA-288
|
Business Offer - Enhanced Ground Proximity
|
|
Warning System (EGPWS) - Activiation - Peaks
|
|
and Obstacles Feature
|
|
(
Not applicable to Block 700LUV & Block 800LUV Aircraft)
|
|
|
6-1162-JMG-501R2
|
Business Offer - ACARS package
|
|
(
Not applicable to Block 700LUV & Block 800LUV Aircraft)
|
INACTIVE / DELETED TABLES, EXHIBITS, AND LETTER AGREEMENTS
|
|||
|
|
|
|
TABLE
|
|
|
|
|
|
|
|
Table
|
Title
|
Last Updated
under SA
|
Current Status
|
1
|
Aircraft Information Table
|
SA-75
|
Inactive
|
2
|
Option Aircraft Information Table
|
SA-74
|
Deleted under SA-75
|
1a
|
Aircraft Information Table - Block 700LUV Aircraft
|
SA-91
|
Deleted Under SA-92
|
EXHIBITS
|
|
|
|
|
|
|
|
Exhibits
|
Title
|
Last Updated under SA
|
Current Status
|
A
|
Aircraft Configuration - 737-700
|
SA-36
|
Inactive
|
A-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1-Winglet
|
Aircraft Configuration
|
SA-36
|
Inactive
|
A-1A
|
Aircraft Configuration - 737-700 Block T-W-2c
|
SA-36
|
Inactive
|
A-2
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-47
|
Inactive
|
A-3
|
Aircraft Configuration - 737-700 Block T-W-2 / T-W-2a
|
SA-61
|
Inactive
|
A-4
|
Aircraft Configuration - 737-700 Block T-W-2b Aircraft
|
SA-66
|
Inactive
|
A-5
|
Aircraft Configuration - Block 700LUV Aircraft
|
SA-75
|
Deleted under SA-92
|
C.2
|
737-800 Customer Support Variables
|
SA-71
|
Deleted under SA-75
|
D
|
Price Adjustment Due to
Economic Fluctuations - Aircraft Price Adjustment
(July 1992 Base Price)
|
|
Inactive
|
P.A. No. 1810
|
|
|
K/SWA
|
v
|
SA-
97
|
Exhibits
|
Title
|
Last Updated under SA
|
Current Status
|
D-1
|
Price Adjustment Due to Economic Fluctuations - Aircraft Price Adjustment
(July 1999 Base Price)
|
SA-13
|
Inactive
|
E.2
|
737-800 Buyer Furnished Equipment Provisions Document
|
SA-73
|
Deleted under SA-75
|
RESTRICTED LETTER AGREEMENTS
|
|
|
|
|
|
|
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
6‑1162‑RLL‑933R21
|
Option Aircraft
|
SA-60
|
Deleted under SA-75
|
6‑1162‑RLL‑935R1
|
Performance Guarantees
|
SA-1
|
Inactive
|
6‑1162‑RLL‑936R4
|
Certain Contractual Matters
|
SA-4
|
Inactive
|
6‑1162‑RLL‑937
|
Alternate Advance Payment Schedule
|
|
Inactive
|
6‑1162‑RLL‑938
|
***
|
|
Inactive
|
6‑1162‑RLL‑939R1
|
Certification Flight Test Aircraft
|
SA-1
|
Inactive
|
6‑1162‑RLL‑940R1
|
Training Matters
|
SA-1
|
Inactive
|
6‑1162‑RLL‑942
|
Open Configuration Matters
|
|
Inactive
|
6‑1162‑RLL‑943R1
|
Substitution Rights
|
SA-6
|
Deleted under SA 75
|
6‑1162‑RLL‑944
|
***
|
|
Inactive
|
6-1162-RLL-945
|
Comparison of 737-7H4 and 737-3H4 Block Fuel Burn
|
|
Inactive
|
6-1162-RLL-1855R3
|
Additional Contractual Matters
|
SA-4
|
Inactive
|
6-1162-RLL-1856
|
***
|
SA-1
|
Inactive
|
6-1162-RLL-1857
|
Service Ready Validation Program Field Test
|
SA-1
|
Inactive
|
6-1162-RLL-1858R1
|
Escalation Matters
|
SA-4
|
Inactive
|
6-1162-RLL-2036
|
Amortization of Costs for Customer Unique Changes
|
SA-1
|
Inactive
|
6-1162-RLL-2037
|
Reconciliation of the Aircraft Basic Price
|
SA-1
|
Inactive
|
6-1162-RLL-2073
|
Maintenance Training Matters
|
SA-1
|
Inactive
|
6-1162-KJJ-058R1
|
Additional Substitution Rights
|
SA-71
|
Deleted under SA-75
|
P.A. No. 1810
|
|
|
K/SWA
|
vi
|
SA-
97
|
P.A. No. 1810
|
|
|
K/SWA
|
vii
|
SA-
97
|
|
Table 1d to
|
|
|
Purchase Agreement No. PA-01810
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
Block 800LUV Aircraft (non-ETOPS Configuration)
|
|
Airframe Model/MTOW:
|
737-800
|
174,200 pounds
|
|
Detail Specification:
|
D019A001SWA38 (1/9/2015)
|
Engine Model/Thrust:
|
CFM56-7B27
|
27,300 pounds
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-11
|
ECI-MFG/CPI
|
Airframe Price:
|
***
|
|
Engine Price Base Year/Escalation Formula:
|
N/A
|
N/A
|
Optional Features:
|
***
|
|
|
Sub-Total of Airframe and Features:
|
***
|
|
Airframe Escalation Data:
|
Engine Price (Per Aircraft):
|
***
|
|
Base Year Index (ECI):
|
***
|
Aircraft Basic Price (Excluding BFE/SPE):
|
***
|
|
Base Year Index (CPI):
|
***
|
Buyer Furnished Equipment (BFE) Estimate:
|
***
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
***
|
|
Deposit per Exercised Option Aircraft (OPEX):
|
***
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Dec-2016
|
2
|
***
|
63593, 63594
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63592
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63575
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
3
|
***
|
63576, 63577,
63578
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
1
|
***
|
63571
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
2
|
***
|
63595, 63596
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
1
|
***
|
63587
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
63586
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
3
|
***
|
63572, 63573,
63574
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63579
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63597
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
2
|
***
|
63580, 63581
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
|
SWA-PA-01810 82233 / 88233 /
93899
|
Boeing Proprietary
|
SA-
97
Page
1
|
|
Table 1d to
|
|
|
Purchase Agreement No. PA-01810
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
Block 800LUV Aircraft (non-ETOPS Configuration)
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Aircraft
Serial
Number
|
Escalation
Forecast
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
|||||||
Nov-2017
|
2
|
***
|
63598, 63599
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
2
|
***
|
63582, 63583
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
4
|
***
|
63600, 63601,
63602, 36993
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
1
|
***
|
64115
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jan-2018
|
2
|
***
|
63584, 63585
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2018
|
2
|
***
|
64171, 64172
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
64174
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
63588, 63589
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
63590, 63591
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
|
|
|
|
|
|
|
|
|
Total:
|
37
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
|
|
|
|
1) ***
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SWA-PA-01810 82233 / 88233 /
93899
|
Boeing Proprietary
|
SA-
97
Page
2
|
Attachment B To
|
Letter Agreement SWA-PA-1810-LA-1105884R2
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
Airframe Model/MTOW:
|
737-800
|
174,200 pounds
|
|
Detail Specification:
|
D019A001SWA38 (1/9/2015)
|
||
Engine Model/Thrust:
|
CFM56-7B27
|
27,300 pounds
|
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Airframe Price Base Year/Escalation Formula:
|
Jul-11
|
|
ECI-MFG/CPI
|
Airframe Price:
|
***
|
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Engine Price Base Year/Escalation Formula:
|
N/A
|
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N/A
|
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Optional Features Estimate:
|
***
|
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|
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Sub-Total of Airframe and Features:
|
***
|
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Airframe Escalation Data:
|
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|
|
|
Engine Price (Per Aircraft):
|
***
|
|
Base Year Index (ECI):
|
|
***
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
***
|
|
Base Year Index (CPI):
|
|
***
|
|
|
Buyer Furnished Equipment (BFE) Estimate:
|
***
|
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|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
***
|
|
|
|
|
|
|
Deposit per Aircraft:
|
***
|
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|
|
|
|
Delivery
Date
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise
Date
|
|
Escalation Estimate
Adv Payment Base
Price Per A/P
|
Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
|
|||
At Signing
***
|
24 Mos.
***
|
21/18/12/9/6 Mos.
***
|
Total
***
|
||||||
Apr-2018
|
1
|
***
|
10/1/16
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
11/1/16
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
12/1/16
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
2
|
***
|
1/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
2/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2018
|
1
|
***
|
3/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2018
|
1
|
***
|
4/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2018
|
1
|
***
|
5/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
1
|
***
|
6/1/17
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
14
|
|
|
|
|
|
|
|
|
|
|
|
SWA-PA-01810 82233-1F.TXT
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BOEING PROPRIETARY
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SA-
97
Page 1
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AMENDED AND RESTATED
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SOUTHWEST AIRLINES CO.
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2005 EXCESS BENEFIT PLAN
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(as amended and restated, effective as of March 1, 2016)
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Table of Contents
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Page
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ARTICLE I
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DEFINITIONS.................................................................................................................................
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1
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ARTICLE II
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ELIGIBILITY...................................................................................................................................
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3
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ARTICLE III
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CREDITS TO ACCOUNT..............................................................................................................
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3
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ARTICLE IV
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ENTITLEMENT TO BENEFITS..................................................................................................
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4
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ARTICLE V
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PAYMENT OF BENEFITS............................................................................................................
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5
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ARTICLE VI
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IN-SERVICE WITHDRAWALS AND LOANS...........................................................................
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8
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ARTICLE VII
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ADMINISTRATION OF THE PLAN...........................................................................................
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8
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ARTICLE VIII
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CLAIMS REVIEW PROCEDURE...............................................................................................
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9
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ARTICLE IX
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LIMITATION OF RIGHTS...........................................................................................................
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11
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ARTICLE X
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LIMITATION OF ASSIGNMENT AND PAYMENTS TO LEGALLY INCOMPETENT DISTRIBUTEE...............................................................................................................................
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11
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ARTICLE XI
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AMENDMENT TO OR TERMINATION OF THE PLAN........................................................
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11
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ARTICLE XII
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STATUS OF PARTICIPANT AS UNSECURED CREDITOR...................................................
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12
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ARTICLE XIII
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GENERAL AND MISCELLANEOUS..........................................................................................
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13
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i
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ARTICLE I
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DEFINITIONS
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1
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2
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3
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ARTICLE II
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ELIGIBILITY
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ARTICLE III
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CREDITS TO ACCOUNT
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4
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ARTICLE IV
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ENTITLEMENT TO BENEFITS
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5
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ARTICLE V
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PAYMENT OF BENEFITS
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6
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7
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ARTICLE VI
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IN-SERVICE WITHDRAWALS AND LOANS
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8
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ARTICLE VII
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ADMINISTRATION OF THE PLAN
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9
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ARTICLE VIII
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CLAIMS REVIEW PROCEDURE
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10
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ARTICLE IX
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LIMITATION OF RIGHTS
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11
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ARTICLE X
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LIMITATION OF ASSIGNMENT AND PAYMENTS TO
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LEGALLY INCOMPETENT DISTRIBUTEE
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ARTICLE XI
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AMENDMENT TO OR TERMINATION OF THE PLAN
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12
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ARTICLES XII
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STATUS OF PARCICIPANT AS UNSECURED CREDITOR
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ARTICLE XIII
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GENERAL AND MISCELLANEOUS
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13
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14
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SOUTHWEST AIRLINES CO.
|
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DEFERRED COMPENSATION PLAN FOR
|
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SENIOR LEADERSHIP AND NON-EMPLOYEE MEMBERS OF THE SOUTHWEST
|
||
AIRLINES CO. BOARD OF DIRECTORS
|
||
(as amended and restated, effective as of March 1, 2016)
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SOUTHWEST AIRLINES CO.
|
||
DEFERRED COMPENSATION PLAN FOR
|
||
SENIOR LEADERSHIP AND NON-EMPLOYEE MEMBERS OF THE SOUTHWEST
|
||
AIRLINES CO. BOARD OF DIRECTORS
|
||
(as amended and restated, effective as of March 1, 2016)
|
|
Table of Contents
|
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Page
|
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ARTICLE I DEFINITIONS......................................................................................................
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1
|
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ARTICLE II ELIGIBILITY......................................................................................................
|
4
|
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ARTICLE III CREDITS TO ACCOUNT................................................................................
|
4
|
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ARTICLE IV ENTITLEMENT TO BENEFITS.....................................................................
|
5
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ARTICLE V PAYMENT OF BENEFITS.................................................................................
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6
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ARTICLE VI IN-SERVICE WITHDRAWALS AND LOANS...............................................
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8
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ARTICLE VII ADMINISTRATION OF THE PLAN.............................................................
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8
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ARTICLE VIII CLAIMS REVIEW PROCEDURE................................................................
|
9
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ARTICLE IX LIMITATION OF RIGHTS...............................................................................
|
11
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ARTICLE X LIMITATION OF ASSIGNMENT AND PAYMENTS TO LEGALLY INCOMPETENT DISTRIBUTEE...............................................................................................
|
11
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ARTICLE XI AMENDMENT TO OR TERMINATION OF THE PLAN..............................
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11
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ARTICLE XII STATUS OF PARTICIPANT AS UNSECURED CREDITOR.......................
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12
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ARTICLE XIII GENERAL AND MISCELLANEOUS............................................................
|
13
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i
|
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SOUTHWEST AIRLINES CO.
|
||
DEFERRED COMPENSATION PLAN FOR
|
||
SENIOR LEADERSHIP AND NON-EMPLOYEE MEMBERS OF THE SOUTHWEST
|
||
AIRLINES CO. BOARD OF DIRECTORS
|
||
(Effective for plan years beginning on and after January 1, 2015)
|
|
ARTICLE 1
|
|
|
DEFINITIONS
|
|
|
1
|
|
|
2
|
|
|
3
|
|
|
ARTICLE II
|
|
|
ELIGIBILITY
|
|
|
ARTICLE III
|
|
|
CREDITS TO ACCOUNT
|
|
|
4
|
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ARTICLE IV
|
|
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ENTITLEMENT TO BENEFITS
|
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5
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ARTICLE V
|
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PAYMENTS OF BENEFITS
|
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6
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7
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ARTICLE VI
|
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IN-SERVICE WITHDRAWALS AND LOANS
|
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ARTICLE VII
|
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ADMINISTRATION OF THE PLAN
|
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8
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ARTICLE VIII
|
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CLAIMS REVIEW PRODECURE
|
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9
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10
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ARTICLE IX
|
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LIMITATION OF RIGHTS
|
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ARTICLE X
|
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LIMITATION OF ASSIGNMENT AND PAYMENTS TO
|
|
|
LEGALLY INCOMPETENT DISTRIBUTEE
|
|
|
ARTICLE XI
|
|
|
AMENDMENT TO OR TERMINATION OF THE PLAN
|
|
|
11
|
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ARTICLE XII
|
|
|
STATUS OF PARTICIPANT AS UNSECURED CREDITOR
|
|
|
12
|
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ARTICLE XIII
|
|
|
GENERAL AND MISCELLANEOUS
|
|
|
13
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|
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By:
|
/s/ Gary C. Kelly
|
|
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Gary C. Kelly
|
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Chief Executive Officer
|
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By:
|
/s/ Tammy Romo
|
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Tammy Romo
|
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Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
By:
|
/s/ Gary C. Kelly
|
|
|
Gary C. Kelly
|
|
|
Chief Executive Officer
|
|
By:
|
/s/ Tammy Romo
|
|
|
Tammy Romo
|
|
|
Chief Financial Officer
|