þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
For the quarterly period ended March 31, 2018
|
|
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
¨
|
|
Emerging growth company
¨
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
|
|
|
As Recast
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,822
|
|
|
$
|
1,495
|
|
Short-term investments
|
1,421
|
|
|
1,778
|
|
||
Accounts and other receivables
|
680
|
|
|
662
|
|
||
Inventories of parts and supplies, at cost
|
430
|
|
|
420
|
|
||
Prepaid expenses and other current assets
|
448
|
|
|
460
|
|
||
Total current assets
|
4,801
|
|
|
4,815
|
|
||
|
|
|
|
||||
Property and equipment, at cost:
|
|
|
|
|
|
||
Flight equipment
|
21,143
|
|
|
21,368
|
|
||
Ground property and equipment
|
4,506
|
|
|
4,399
|
|
||
Deposits on flight equipment purchase contracts
|
913
|
|
|
919
|
|
||
Assets constructed for others
|
1,607
|
|
|
1,543
|
|
||
|
28,169
|
|
|
28,229
|
|
||
Less allowance for depreciation and amortization
|
9,396
|
|
|
9,690
|
|
||
|
18,773
|
|
|
18,539
|
|
||
Goodwill
|
970
|
|
|
970
|
|
||
Other assets
|
959
|
|
|
786
|
|
||
|
$
|
25,503
|
|
|
$
|
25,110
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
1,243
|
|
|
$
|
1,320
|
|
Accrued liabilities
|
1,134
|
|
|
1,700
|
|
||
Air traffic liability
|
4,420
|
|
|
3,495
|
|
||
Current maturities of long-term debt
|
365
|
|
|
348
|
|
||
Total current liabilities
|
7,162
|
|
|
6,863
|
|
||
|
|
|
|
||||
Long-term debt less current maturities
|
3,227
|
|
|
3,320
|
|
||
Air traffic liability - loyalty noncurrent
|
1,010
|
|
|
1,070
|
|
||
Deferred income taxes
|
2,216
|
|
|
2,119
|
|
||
Construction obligation
|
1,563
|
|
|
1,390
|
|
||
Other noncurrent liabilities
|
706
|
|
|
707
|
|
||
Stockholders' equity:
|
|
|
|
|
|
||
Common stock
|
808
|
|
|
808
|
|
||
Capital in excess of par value
|
1,452
|
|
|
1,451
|
|
||
Retained earnings
|
14,238
|
|
|
13,832
|
|
||
Accumulated other comprehensive income
|
78
|
|
|
12
|
|
||
Treasury stock, at cost
|
(6,957
|
)
|
|
(6,462
|
)
|
||
Total stockholders' equity
|
9,619
|
|
|
9,641
|
|
||
|
$
|
25,503
|
|
|
$
|
25,110
|
|
|
Three months ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
As Recast
|
||||
OPERATING REVENUES:
|
|
|
|
||||
Passenger
|
$
|
4,585
|
|
|
$
|
4,546
|
|
Freight
|
42
|
|
|
42
|
|
||
Other
|
317
|
|
|
266
|
|
||
Total operating revenues
|
4,944
|
|
|
4,854
|
|
||
|
|
|
|
||||
OPERATING EXPENSES:
|
|
|
|
|
|
||
Salaries, wages, and benefits
|
1,821
|
|
|
1,730
|
|
||
Fuel and oil
|
1,018
|
|
|
956
|
|
||
Maintenance materials and repairs
|
257
|
|
|
243
|
|
||
Landing fees and airport rentals
|
330
|
|
|
313
|
|
||
Depreciation and amortization
|
277
|
|
|
318
|
|
||
Other operating expenses
|
625
|
|
|
688
|
|
||
Total operating expenses
|
4,328
|
|
|
4,248
|
|
||
|
|
|
|
||||
OPERATING INCOME
|
616
|
|
|
606
|
|
||
|
|
|
|
||||
OTHER EXPENSES (INCOME):
|
|
|
|
|
|
||
Interest expense
|
32
|
|
|
29
|
|
||
Capitalized interest
|
(10
|
)
|
|
(11
|
)
|
||
Interest income
|
(12
|
)
|
|
(7
|
)
|
||
Other (gains) losses, net
|
4
|
|
|
63
|
|
||
Total other expenses (income)
|
14
|
|
|
74
|
|
||
|
|
|
|
||||
INCOME BEFORE INCOME TAXES
|
602
|
|
|
532
|
|
||
PROVISION FOR INCOME TAXES
|
139
|
|
|
193
|
|
||
|
|
|
|
||||
NET INCOME
|
$
|
463
|
|
|
$
|
339
|
|
|
|
|
|
||||
NET INCOME PER SHARE, BASIC
|
$
|
0.79
|
|
|
$
|
0.55
|
|
|
|
|
|
||||
NET INCOME PER SHARE, DILUTED
|
$
|
0.79
|
|
|
$
|
0.55
|
|
|
|
|
|
||||
COMPREHENSIVE INCOME
|
$
|
547
|
|
|
$
|
350
|
|
|
|
|
|
||||
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
|
|||
Basic
|
587
|
|
|
613
|
|
||
Diluted
|
588
|
|
|
614
|
|
||
|
|
|
|
||||
Cash dividends declared per common share
|
$
|
.125
|
|
|
$
|
.100
|
|
|
Three months ended
|
||||||
|
March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
As Recast
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
463
|
|
|
$
|
339
|
|
Adjustments to reconcile net income to cash provided by (used in) operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
277
|
|
|
318
|
|
||
Unrealized/realized (gain) loss on fuel derivative instruments
|
(7
|
)
|
|
27
|
|
||
Deferred income taxes
|
72
|
|
|
54
|
|
||
Changes in certain assets and liabilities:
|
|
|
|
|
|
||
Accounts and other receivables
|
(15
|
)
|
|
(35
|
)
|
||
Other assets
|
(178
|
)
|
|
(81
|
)
|
||
Accounts payable and accrued liabilities
|
(501
|
)
|
|
92
|
|
||
Air traffic liability
|
866
|
|
|
918
|
|
||
Cash collateral received from derivative counterparties
|
65
|
|
|
37
|
|
||
Other, net
|
(40
|
)
|
|
(44
|
)
|
||
Net cash provided by operating activities
|
1,002
|
|
|
1,625
|
|
||
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
||
Capital expenditures
|
(409
|
)
|
|
(414
|
)
|
||
Assets constructed for others
|
(24
|
)
|
|
(49
|
)
|
||
Purchases of short-term investments
|
(200
|
)
|
|
(563
|
)
|
||
Proceeds from sales of short-term and other investments
|
560
|
|
|
556
|
|
||
Net cash used in investing activities
|
(73
|
)
|
|
(470
|
)
|
||
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
||
Proceeds from Employee stock plans
|
9
|
|
|
7
|
|
||
Reimbursement for assets constructed for others
|
139
|
|
|
49
|
|
||
Payments of long-term debt and capital lease obligations
|
(82
|
)
|
|
(369
|
)
|
||
Payments of cash dividends
|
(148
|
)
|
|
(123
|
)
|
||
Repayment of construction obligation
|
(7
|
)
|
|
(2
|
)
|
||
Repurchase of common stock
|
(500
|
)
|
|
(550
|
)
|
||
Other, net
|
(13
|
)
|
|
4
|
|
||
Net cash used in financing activities
|
(602
|
)
|
|
(984
|
)
|
||
|
|
|
|
||||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
327
|
|
|
171
|
|
||
|
|
|
|
||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
1,495
|
|
|
1,680
|
|
||
|
|
|
|
||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
1,822
|
|
|
$
|
1,851
|
|
|
|
|
|
||||
CASH PAYMENTS FOR:
|
|
|
|
||||
Interest, net of amount capitalized
|
$
|
18
|
|
|
$
|
27
|
|
Income taxes
|
$
|
4
|
|
|
$
|
6
|
|
|
|
|
|
||||
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
|
|
|
|
||||
Flight equipment under capital leases
|
$
|
14
|
|
|
$
|
39
|
|
Assets constructed for others
|
$
|
40
|
|
|
$
|
50
|
|
|
Balance as of December 31, 2017
|
||||||||||
(in millions)
|
As Reported
|
|
New Revenue Standard
|
|
As Recast
|
||||||
Accrued liabilities
|
$
|
1,777
|
|
|
$
|
(77
|
)
|
|
$
|
1,700
|
|
Air traffic liability
|
3,460
|
|
|
35
|
|
|
3,495
|
|
|||
Air traffic liability - loyalty noncurrent
|
—
|
|
|
1,070
|
|
|
1,070
|
|
|||
Deferred income taxes
|
2,358
|
|
|
(239
|
)
|
|
2,119
|
|
|||
Retained earnings
|
14,621
|
|
|
(789
|
)
|
|
13,832
|
|
|
Three months ended March 31, 2017
|
||||||||||||||||||
(in millions), except per share amounts
|
As Reported
|
|
New Revenue Standard
|
|
New Retirement Standard
|
|
New Hedging Standard
|
|
As Recast
|
||||||||||
Passenger revenue
|
$
|
4,424
|
|
|
$
|
122
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,546
|
|
Other revenue
|
417
|
|
|
(151
|
)
|
|
—
|
|
|
—
|
|
|
266
|
|
|||||
Salaries, wages, and benefits
|
1,733
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
1,730
|
|
|||||
Fuel and oil expense
|
922
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
956
|
|
|||||
Other operating expenses (a)
|
696
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
688
|
|
|||||
Other (gains) losses, net
|
94
|
|
|
—
|
|
|
3
|
|
|
(34
|
)
|
|
63
|
|
|||||
Provision for income taxes
|
202
|
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
193
|
|
|||||
Net income
|
351
|
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
339
|
|
|||||
Net income per share, basic
|
0.57
|
|
|
(0.02
|
)
|
|
—
|
|
|
—
|
|
|
0.55
|
|
|||||
Net income per share, diluted
|
0.57
|
|
|
(0.02
|
)
|
|
—
|
|
|
—
|
|
|
0.55
|
|
|
Three months ended March 31, 2017
|
||||||||||
(in millions)
|
As Reported
|
|
New Revenue Standard
|
|
As Recast
|
||||||
Net income
|
$
|
351
|
|
|
$
|
(12
|
)
|
|
$
|
339
|
|
Deferred income taxes
|
62
|
|
|
(9
|
)
|
|
54
|
|
|||
Changes in certain assets and liabilities
|
874
|
|
|
21
|
|
|
894
|
|
|||
Net cash provided by operating activities
|
1,625
|
|
|
—
|
|
|
1,625
|
|
|
|
Maximum fuel hedged as of
|
|
|
|
|
|
March 31, 2018
|
|
Derivative underlying commodity type as of
|
|
Period (by year)
|
|
(gallons in millions) (a)
|
|
March 31, 2018
|
|
Remainder of 2018
|
|
1,235
|
|
|
WTI crude and Brent crude oil
|
2019
|
|
1,377
|
|
|
WTI crude and Brent crude oil
|
2020
|
|
867
|
|
|
WTI crude and Brent crude oil
|
2021
|
|
340
|
|
|
WTI crude oil
|
2022
|
|
88
|
|
|
WTI crude oil
|
|
|
|
|
Asset derivatives
|
|
Liability derivatives
|
||||||||||||
|
|
Balance Sheet
|
|
Fair value at
|
|
Fair value at
|
|
Fair value at
|
|
Fair value at
|
||||||||
(in millions)
|
|
location
|
|
3/31/2018
|
|
12/31/2017
|
|
3/31/2018
|
|
12/31/2017
|
||||||||
Derivatives designated as hedges (a)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivative contracts (gross)
|
|
Prepaid expenses and other current assets
|
|
$
|
145
|
|
|
$
|
112
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fuel derivative contracts (gross)
|
|
Other assets
|
|
195
|
|
|
136
|
|
|
—
|
|
|
—
|
|
||||
Interest rate derivative contracts
|
|
Other noncurrent liabilities
|
|
—
|
|
|
—
|
|
|
24
|
|
|
20
|
|
||||
Total derivatives designated as hedges
|
|
$
|
340
|
|
|
$
|
248
|
|
|
$
|
24
|
|
|
$
|
20
|
|
||
Derivatives not designated as hedges (a)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivative contracts (gross)
|
|
Prepaid expenses and other current assets
|
|
$
|
23
|
|
|
$
|
35
|
|
|
$
|
23
|
|
|
$
|
35
|
|
Interest rate derivative contracts
|
|
Accrued liabilities
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Interest rate derivative contracts
|
|
Other noncurrent liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Total derivatives not designated as hedges
|
|
|
|
$
|
23
|
|
|
$
|
35
|
|
|
$
|
24
|
|
|
$
|
37
|
|
Total derivatives
|
|
|
|
$
|
363
|
|
|
$
|
283
|
|
|
$
|
48
|
|
|
$
|
57
|
|
Balance Sheet location of hedged item
|
|
Carrying amount of the hedged liabilities
|
|
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged liabilities (a)
|
||||||||||||
|
|
March 31,
|
|
March 31,
|
||||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Long-term debt less current maturities
|
|
$
|
784
|
|
|
$
|
793
|
|
|
$
|
5
|
|
|
$
|
15
|
|
|
|
Balance Sheet
|
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
|
location
|
|
2018
|
|
2017
|
||||
Cash collateral deposits held from counterparties for fuel
contracts - current
|
|
Offset against Prepaid expenses and other current assets
|
|
$
|
60
|
|
|
$
|
15
|
|
Cash collateral deposits held from counterparties for fuel
contracts - noncurrent
|
|
Offset against Other assets
|
|
20
|
|
|
—
|
|
||
Due to third parties for fuel contracts
|
|
Accounts payable
|
|
—
|
|
|
29
|
|
||
Receivable from third parties for fuel contracts
|
|
Accounts and other receivables
|
|
9
|
|
|
—
|
|
Offsetting of derivative liabilities
|
|
||||||||||||||||||||||||||
(in millions)
|
|
||||||||||||||||||||||||||
|
|
|
|
(i)
|
|
(ii)
|
|
(iii) = (i) + (ii)
|
|
(i)
|
|
(ii)
|
|
(iii) = (i) + (ii)
|
|
||||||||||||
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
|
||||||||||||||||||||
Description
|
|
Balance Sheet location
|
|
Gross amounts of recognized liabilities
|
|
Gross amounts offset in the Balance Sheet
|
|
Net amounts of liabilities presented in the Balance Sheet
|
|
Gross amounts of recognized liabilities
|
|
Gross amounts offset in the Balance Sheet
|
|
Net amounts of liabilities presented in the Balance Sheet
|
|
||||||||||||
Fuel derivative contracts
|
|
Prepaid expenses and other current assets
|
|
$
|
83
|
|
|
$
|
(83
|
)
|
|
$
|
—
|
|
|
$
|
50
|
|
|
$
|
(50
|
)
|
|
$
|
—
|
|
|
Fuel derivative contracts
|
|
Other assets
|
|
$
|
20
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
(a)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(a)
|
Interest rate derivative contracts
|
|
Accrued liabilities
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
Interest rate derivative contracts
|
|
Other noncurrent liabilities
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
24
|
|
(a)
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
(a)
|
Location and amount of (gain) loss recognized in income on cash flow and fair value hedging relationships
|
||||||||||||||||
|
|
Three months ended March 31, 2018
|
|
Three months ended March 31, 2017
|
||||||||||||
(in millions)
|
|
Fuel and oil
|
|
Interest expense
|
|
Fuel and oil
|
|
Interest expense
|
||||||||
Total
|
|
$
|
4
|
|
|
$
|
10
|
|
|
$
|
139
|
|
|
$
|
8
|
|
|
|
|
|
|
|
|
|
|
||||||||
Loss on cash flow hedging relationships:
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts:
|
|
|
|
|
|
|
|
|
||||||||
Amount of loss reclassified from AOCI into income
|
|
4
|
|
|
—
|
|
|
139
|
|
|
—
|
|
||||
Interest contracts:
|
|
|
|
|
|
|
|
|
||||||||
Amount of loss reclassified from AOCI into income
|
|
—
|
|
|
2
|
|
|
—
|
|
|
3
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Impact of fair value hedging relationships:
|
|
|
|
|
|
|
|
|
||||||||
Interest contracts:
|
|
|
|
|
|
|
|
|
||||||||
Hedged items
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Derivatives designated as hedging instruments
|
|
—
|
|
|
2
|
|
|
—
|
|
|
(1
|
)
|
|
Counterparty (CP)
|
|
|
||||||||||||||||||||||||||||
(in millions)
|
A
|
|
B
|
|
C
|
|
D
|
|
E
|
|
F
|
|
Other
(a)
|
|
Total
|
||||||||||||||||
Fair value of fuel derivatives
|
$
|
116
|
|
|
$
|
67
|
|
|
$
|
77
|
|
|
$
|
39
|
|
|
$
|
17
|
|
|
$
|
11
|
|
|
$
|
13
|
|
|
$
|
340
|
|
Cash collateral held from CP
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
||||||||
Aircraft collateral pledged to CP
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Letters of credit (LC)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Option to substitute LC for aircraft
|
(200) to (600)(b)
|
|
(100) to (500)(c)
|
|
(150) to (550)(c)
|
|
(150) to (550)(c)
|
|
N/A
|
|
N/A
|
|
|
|
|
||||||||||||||||
Option to substitute LC for cash
|
N/A
|
|
>(500)(c)
|
|
(75) to (150) or >(550)(c)
|
|
(125) to (150) or >(550)(d)
|
|
(d)
|
|
N/A
|
|
|
|
|
||||||||||||||||
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)
|
|
(75) to (150) or >(550)(e)
|
|
(125) to (150) or >(550)(e)
|
|
>(125)
|
|
>(65)(e)
|
|
|
|
|
||||||||||||||||
Cash is received from CP
|
>50(e)
|
|
>150(e)
|
|
>250(e)
|
|
>75(e)
|
|
>100(e)
|
|
>30(e)
|
|
|
|
|
||||||||||||||||
Aircraft or cash can be pledged to
CP as collateral
|
(200) to (600)(f)
|
|
(100) to (500)(c)
|
|
(150) to (550)(c)
|
|
(150) to (550)(c)
|
|
N/A
|
|
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)
|
|
(0) to (150) or >(550)
|
|
(0) to (150) or >(550)
|
|
(g)
|
|
(g)
|
|
|
|
|
||||||||||||||||
Cash is received from CP
|
(g)
|
|
(g)
|
|
(g)
|
|
(g)
|
|
(g)
|
|
(g)
|
|
|
|
|
||||||||||||||||
Aircraft or cash can be pledged to
CP as collateral
|
(200) to (600)
|
|
(100) to (500)
|
|
(150) to (550)
|
|
(150) to (550)
|
|
N/A
|
|
N/A
|
|
|
|
|
|
Three months ended March 31,
|
||||||
(in millions)
|
2018
|
|
2017
|
||||
NET INCOME
|
$
|
463
|
|
|
$
|
339
|
|
Unrealized gain on fuel derivative instruments, net of
deferred taxes of $25 and $5
|
81
|
|
|
9
|
|
||
Unrealized gain on interest rate derivative instruments, net of
deferred taxes of $- and $1
|
3
|
|
|
2
|
|
||
Total other comprehensive income
|
$
|
84
|
|
|
$
|
11
|
|
COMPREHENSIVE INCOME
|
$
|
547
|
|
|
$
|
350
|
|
(in millions)
|
Fuel derivatives
|
|
Interest rate derivatives
|
|
Defined benefit plan items
|
|
Other
|
|
Deferred tax
|
|
Accumulated other
comprehensive income (loss)
|
||||||||||||
Balance at December 31, 2017
|
$
|
3
|
|
|
$
|
(7
|
)
|
|
$
|
(9
|
)
|
|
$
|
33
|
|
|
$
|
(8
|
)
|
|
$
|
12
|
|
ASU 2017-12 adoption adjustment (a)
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
(20
|
)
|
||||||
ASU 2018-02 stranded AOCI adoption adjustment (b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||||
Changes in fair value
|
102
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|
79
|
|
||||||
Reclassification to earnings
|
4
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
5
|
|
||||||
Balance at March 31, 2018
|
$
|
83
|
|
|
$
|
(4
|
)
|
|
$
|
(9
|
)
|
|
$
|
33
|
|
|
$
|
(25
|
)
|
|
$
|
78
|
|
Three months ended March 31, 2018
|
||||||
(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
|
|
$
|
4
|
|
|
Fuel and oil expense
|
|
|
1
|
|
|
Less: Tax expense
|
|
|
|
$
|
3
|
|
|
Net of tax
|
Unrealized loss on interest rate derivative instruments
|
|
$
|
2
|
|
|
Interest expense
|
|
|
—
|
|
|
Less: Tax expense
|
|
|
|
$
|
2
|
|
|
Net of tax
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
5
|
|
|
Net of tax
|
|
Three months ended March 31,
|
||||||
(in millions)
|
2018
|
|
2017
|
||||
Passenger non-loyalty
|
$
|
3,948
|
|
|
$
|
3,907
|
|
Passenger loyalty - air transportation
|
491
|
|
|
507
|
|
||
Passenger ancillary sold separately
|
146
|
|
|
132
|
|
||
Total passenger revenues
|
$
|
4,585
|
|
|
$
|
4,546
|
|
•
|
Allocation of Passenger Revenue
- Revenues from Passengers related to travel who also earn Rapid Rewards Points has been allocated between flight and Rapid Rewards Points based on each obligation’s relative standalone selling price. The Company utilizes historical earning patterns to assist in this allocation.
|
•
|
Fair Value of Rapid Rewards Points
is determined from the base fare value of tickets which were purchased using prior point redemptions for travel and other products and services, which the Company believes to be indicative of the fair value of points as perceived by Customers and representative of the value of each point at the time of redemption. The Company’s booking site allows a Customer to toggle between fares utilizing either cash or point redemptions, which provide the Customer with an approximation of the equivalent value of their points. The value can differ however, based on demand, the amount of time prior to the flight, and other factors. The fare mix during the period measured represents a constraint, which could result in the assumptions above changing at the measurement date, as fare classes can have different coefficients used to determine the total frequent flyer points needed to purchase an award ticket. The mixture of these fare classes could cause the fair value per point to increase or decrease.
|
•
|
Tickets and Rapid Rewards Points
- When a flight occurs, the related performance obligation is satisfied and the related value provided by the Customer, whether from purchased tickets or Rapid Rewards Points, is recognized as revenue.
|
•
|
Frequent flyer points redeemed for goods and/or services other than travel
- Rapid Rewards Members have the option to redeem points for goods and services offered through a third party vendor, who acts as principal. The performance obligation related to the purchase of these goods and services is satisfied when the good and/or service is delivered to the Customer.
|
•
|
Marketing Royalties
- As part of its Agreement with Chase, Southwest provides certain deliverables, including use of the Southwest Airlines’ brand, access to Rapid Rewards Member lists, advertising elements, and the Company’s resource team. These performance obligations are satisfied each month that the Agreement is active.
|
|
Balance as of
|
||||||
(in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
Air traffic liability - passenger travel and ancillary passenger services
|
$
|
2,631
|
|
|
$
|
1,898
|
|
Air traffic liability - loyalty program
|
2,799
|
|
|
2,667
|
|
||
Total Air traffic liability
|
$
|
5,430
|
|
|
$
|
4,565
|
|
|
Air traffic liability
|
||
Balance at December 31, 2017
|
$
|
4,565
|
|
Current period sales (passenger travel, ancillary services, flight loyalty, and partner loyalty)
|
5,403
|
|
|
Revenue from amounts included in contract liability opening balances (a)
|
(1,827
|
)
|
|
Revenue from current period sales (a)
|
(2,711
|
)
|
|
Balance at March 31, 2018
|
$
|
5,430
|
|
|
Air traffic liability
|
||
Balance at December 31, 2016
|
$
|
4,221
|
|
Current period sales (passenger travel, ancillary services, flight loyalty, and partner loyalty)
|
5,415
|
|
|
Revenue from amounts included in contract liability opening balances (a)
|
(1,701
|
)
|
|
Revenue from current period sales (a)
|
(2,796
|
)
|
|
Balance at March 31, 2017
|
$
|
5,139
|
|
|
Three months ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
NUMERATOR:
|
|
|
|
||||
Net income
|
$
|
463
|
|
|
$
|
339
|
|
|
|
|
|
||||
DENOMINATOR:
|
|
|
|
|
|
||
Weighted-average shares outstanding, basic
|
587
|
|
|
613
|
|
||
Dilutive effect of Employee stock options and restricted stock units
|
1
|
|
|
1
|
|
||
Adjusted weighted-average shares outstanding, diluted
|
588
|
|
|
614
|
|
||
|
|
|
|
||||
NET INCOME PER SHARE:
|
|
|
|
|
|
||
Basic
|
$
|
0.79
|
|
|
$
|
0.55
|
|
Diluted
|
$
|
0.79
|
|
|
$
|
0.55
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||||||
(in millions)
|
|
ACFO
|
ACFO,
Net (a)
|
Construction Obligation (b)
|
|
ACFO
|
ACFO,
Net (a)
|
Construction Obligation (b)
|
||||||||||||
FLL Terminal
|
(c)
|
$
|
282
|
|
$
|
279
|
|
$
|
281
|
|
|
$
|
258
|
|
$
|
256
|
|
$
|
258
|
|
LAX Terminal 1
|
(c)
|
450
|
|
432
|
|
447
|
|
|
433
|
|
417
|
|
433
|
|
||||||
LAX Terminal 1.5
|
(c)
|
42
|
|
42
|
|
42
|
|
|
31
|
|
31
|
|
31
|
|
||||||
LFMP Terminal
|
|
543
|
|
470
|
|
513
|
|
|
543
|
|
474
|
|
516
|
|
||||||
LFMP Parking Garage
|
(c)
|
164
|
|
164
|
|
164
|
|
|
152
|
|
152
|
|
152
|
|
||||||
HOU International Terminal
|
|
126
|
|
117
|
|
116
|
|
|
126
|
|
118
|
|
—
|
|
||||||
|
|
$
|
1,607
|
|
$
|
1,504
|
|
$
|
1,563
|
|
|
$
|
1,543
|
|
$
|
1,448
|
|
$
|
1,390
|
|
|
|
|
|
Fair value measurements at reporting date using:
|
||||||||||||
|
|
|
|
Quoted prices in
active markets
for identical assets
|
|
Significant
other observable
inputs
|
|
Significant
unobservable
inputs
|
||||||||
Description
|
|
March 31, 2018
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
(in millions)
|
||||||||||||||
Cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents (a)
|
|
$
|
1,500
|
|
|
$
|
1,500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
|
285
|
|
|
—
|
|
|
285
|
|
|
—
|
|
||||
Certificates of deposit
|
|
12
|
|
|
—
|
|
|
12
|
|
|
—
|
|
||||
Time deposits
|
|
25
|
|
|
—
|
|
|
25
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Treasury bills
|
|
1,144
|
|
|
1,144
|
|
|
—
|
|
|
—
|
|
||||
Certificates of deposit
|
|
277
|
|
|
—
|
|
|
277
|
|
|
—
|
|
||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Option contracts (b)
|
|
363
|
|
|
—
|
|
|
—
|
|
|
363
|
|
||||
Other available-for-sale securities
|
|
122
|
|
|
122
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
|
$
|
3,728
|
|
|
$
|
2,766
|
|
|
$
|
599
|
|
|
$
|
363
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Option contracts (b)
|
|
(23
|
)
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
||||
Interest rate derivatives (see Note 3)
|
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
|
—
|
|
||||
Total liabilities
|
|
$
|
(48
|
)
|
|
$
|
—
|
|
|
$
|
(25
|
)
|
|
$
|
(23
|
)
|
|
|
|
|
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, 2017
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
(in millions)
|
||||||||||||||
Cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash equivalents (a)
|
|
$
|
1,133
|
|
|
$
|
1,133
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
|
350
|
|
|
—
|
|
|
350
|
|
|
—
|
|
||||
Certificates of deposit
|
|
12
|
|
|
—
|
|
|
12
|
|
|
—
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
||||||||
Treasury bills
|
|
1,491
|
|
|
1,491
|
|
|
—
|
|
|
—
|
|
||||
Certificates of deposit
|
|
287
|
|
|
—
|
|
|
287
|
|
|
—
|
|
||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Option contracts (b)
|
|
283
|
|
|
—
|
|
|
—
|
|
|
283
|
|
||||
Other available-for-sale securities
|
|
107
|
|
|
107
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
|
$
|
3,663
|
|
|
$
|
2,731
|
|
|
$
|
649
|
|
|
$
|
283
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Fuel derivatives:
|
|
|
|
|
|
|
|
|
||||||||
Option contracts (b)
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
||||
Interest rate derivatives (see Note 3)
|
|
(22
|
)
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
||||
Total liabilities
|
|
$
|
(57
|
)
|
|
$
|
—
|
|
|
$
|
(22
|
)
|
|
$
|
(35
|
)
|
Quantitative information about Level 3 fair value measurements
|
||||||||
|
|
Valuation technique
|
|
Unobservable input
|
|
Period (by year)
|
|
Range
|
Fuel derivatives
|
|
Option model
|
|
Implied volatility
|
|
Second quarter 2018
|
|
14-31%
|
|
|
|
|
|
|
Third quarter 2018
|
|
21-30%
|
|
|
|
|
|
|
Fourth quarter 2018
|
|
22-29%
|
|
|
|
|
|
|
2019
|
|
21-26%
|
|
|
|
|
|
|
2020
|
|
20-23%
|
|
|
|
|
|
|
2021
|
|
19-20%
|
|
|
|
|
|
|
2022
|
|
19%
|
(in millions)
|
Carrying value
|
|
Estimated fair value
|
|
Fair value level hierarchy
|
||||
French Credit Agreements due June 2018 - 2.54%
|
$
|
1
|
|
|
$
|
1
|
|
|
Level 3
|
2.75% Notes due 2019
|
298
|
|
|
298
|
|
|
Level 2
|
||
Term Loan Agreement payable through 2019 - 6.315%
|
55
|
|
|
55
|
|
|
Level 3
|
||
Term Loan Agreement payable through 2019 - 4.84%
|
15
|
|
|
15
|
|
|
Level 3
|
||
2.65% Notes due 2020
|
486
|
|
|
483
|
|
|
Level 2
|
||
Term Loan Agreement payable through 2020 - 5.223%
|
225
|
|
|
225
|
|
|
Level 3
|
||
737 Aircraft Notes payable through 2020
|
144
|
|
|
144
|
|
|
Level 3
|
||
2.75% Notes due 2022
|
300
|
|
|
295
|
|
|
Level 2
|
||
Pass Through Certificates due 2022 - 6.24%
|
273
|
|
|
293
|
|
|
Level 2
|
||
Term Loan Agreement payable through 2026 - 2.67%
|
215
|
|
|
215
|
|
|
Level 3
|
||
3.00% Notes due 2026
|
300
|
|
|
284
|
|
|
Level 2
|
||
3.45% Notes due 2027
|
300
|
|
|
292
|
|
|
Level 2
|
||
7.375% Debentures due 2027
|
126
|
|
|
151
|
|
|
Level 2
|
(in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
Derivative contracts
|
$
|
175
|
|
|
$
|
136
|
|
Intangible assets, net
|
410
|
|
|
413
|
|
||
Capital lease receivable
|
72
|
|
|
76
|
|
||
Non-current prepaid maintenance
|
130
|
|
|
5
|
|
||
Other
|
172
|
|
|
156
|
|
||
Other assets
|
$
|
959
|
|
|
$
|
786
|
|
(in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
Accounts payable trade
|
$
|
189
|
|
|
$
|
186
|
|
Salaries payable
|
202
|
|
|
201
|
|
||
Taxes payable
|
282
|
|
|
203
|
|
||
Aircraft maintenance payable
|
51
|
|
|
38
|
|
||
Fuel payable
|
107
|
|
|
123
|
|
||
Other payables
|
412
|
|
|
569
|
|
||
Accounts payable
|
$
|
1,243
|
|
|
$
|
1,320
|
|
(in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
ProfitSharing and savings plans
|
$
|
132
|
|
|
$
|
579
|
|
Aircraft and other lease related obligations
|
39
|
|
|
40
|
|
||
Permanently grounded aircraft liability (a)
|
14
|
|
|
34
|
|
||
Vacation pay
|
372
|
|
|
365
|
|
||
Contract ratification bonuses
|
95
|
|
|
83
|
|
||
Health
|
95
|
|
|
100
|
|
||
Workers compensation
|
173
|
|
|
172
|
|
||
Property and income taxes
|
56
|
|
|
57
|
|
||
Other
|
158
|
|
|
270
|
|
||
Accrued liabilities
|
$
|
1,134
|
|
|
$
|
1,700
|
|
(in millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||
Postretirement obligation
|
$
|
282
|
|
|
$
|
275
|
|
Non-current lease-related obligations
|
75
|
|
|
85
|
|
||
Permanently grounded aircraft liability (a)
|
13
|
|
|
13
|
|
||
Other deferred compensation
|
241
|
|
|
237
|
|
||
Derivative contracts
|
24
|
|
|
21
|
|
||
Other
|
71
|
|
|
76
|
|
||
Other noncurrent liabilities
|
$
|
706
|
|
|
$
|
707
|
|
|
|
Three months ended March 31,
|
|
|
|
|||||||
|
|
2018
|
|
2017
|
|
Change
|
||||||
Revenue passengers carried
|
|
31,332,137
|
|
|
29,538,790
|
|
|
6.1
|
%
|
|
||
Enplaned passengers
|
|
37,543,100
|
|
|
35,578,350
|
|
|
5.5
|
%
|
|
||
Revenue passenger miles (RPMs) (000s)
(a)
|
|
30,439,493
|
|
|
29,340,658
|
|
|
3.7
|
%
|
|
||
Available seat miles (ASMs) (000s)
(b)
|
|
37,366,468
|
|
|
36,699,870
|
|
|
1.8
|
%
|
|
||
Load factor
(c)
|
|
81.5
|
%
|
|
79.9
|
%
|
|
1.6
|
|
pts
|
||
Average length of passenger haul (miles)
|
|
972
|
|
|
993
|
|
|
(2.1
|
)%
|
|
||
Average aircraft stage length (miles)
|
|
749
|
|
|
758
|
|
|
(1.2
|
)%
|
|
||
Trips flown
|
|
326,216
|
|
|
321,790
|
|
|
1.4
|
%
|
|
||
Seats flown
(d)
|
|
49,116,216
|
|
|
47,746,088
|
|
|
2.9
|
%
|
|
||
Seats per trip
(e)
|
|
150.56
|
|
|
148.38
|
|
|
1.5
|
%
|
|
||
Average passenger fare
|
|
$
|
146.33
|
|
|
$
|
153.90
|
|
|
(4.9
|
)%
|
|
Passenger revenue yield per RPM (cents)
(f)
|
|
15.06
|
|
|
15.49
|
|
|
(2.8
|
)%
|
|
||
Operating revenues per ASM (cents)
(g)
|
|
13.23
|
|
|
13.23
|
|
|
—
|
|
|
||
Passenger revenue per ASM (cents)
(h)
|
|
12.27
|
|
|
12.39
|
|
|
(1.0
|
)%
|
|
||
Operating expenses per ASM (cents)
(i)
|
|
11.58
|
|
|
11.57
|
|
|
0.1
|
%
|
|
||
Operating expenses per ASM, excluding fuel (cents)
|
|
8.86
|
|
|
8.97
|
|
|
(1.2
|
)%
|
|
||
Operating expenses per ASM, excluding fuel and profitsharing (cents)
|
|
8.58
|
|
|
8.70
|
|
|
(1.4
|
)%
|
|
||
Fuel costs per gallon, including fuel tax
|
|
$
|
2.07
|
|
|
$
|
1.96
|
|
|
5.6
|
%
|
|
Fuel costs per gallon, including fuel tax, economic
|
|
$
|
2.09
|
|
|
$
|
2.03
|
|
|
3.0
|
%
|
|
Fuel consumed, in gallons (millions)
|
|
489
|
|
|
487
|
|
|
0.4
|
%
|
|
||
Active fulltime equivalent Employees
|
|
57,112
|
|
|
54,652
|
|
|
4.5
|
%
|
|
||
Aircraft at end of period
|
|
717
|
|
|
727
|
|
|
(1.4
|
)%
|
|
|
|
Three months ended
|
|
|
|
|||||||
(in millions, except per share amounts)
|
|
March 31,
|
|
|
|
|||||||
GAAP
|
|
2018
|
|
2017
|
|
Percent Change
|
|
|||||
Operating income
|
|
$
|
616
|
|
|
$
|
606
|
|
|
1.7
|
%
|
|
Net income
|
|
$
|
463
|
|
|
$
|
339
|
|
|
36.6
|
%
|
|
Net income per share, diluted
|
|
$
|
0.79
|
|
|
$
|
0.55
|
|
|
43.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Non-GAAP
|
|
|
|
|
|
|
|
|
||||
Operating income
|
|
$
|
584
|
|
|
$
|
574
|
|
|
1.7
|
%
|
|
Net income
|
|
$
|
438
|
|
|
$
|
359
|
|
|
22.0
|
%
|
|
Net income per share, diluted
|
|
$
|
0.75
|
|
|
$
|
0.58
|
|
|
29.3
|
%
|
|
|
Three months ended March 31,
|
|
Per ASM
change
|
|
Percent
change
|
|||||||||
(in cents, except for percentages)
|
2018
|
|
2017
|
|
|
|||||||||
Salaries, wages, and benefits
|
|
4.88
|
¢
|
|
|
4.71
|
¢
|
|
|
0.17
|
¢
|
|
3.6
|
%
|
Fuel and oil
|
2.72
|
|
|
2.60
|
|
|
0.12
|
|
|
4.6
|
|
|||
Maintenance materials and repairs
|
0.69
|
|
|
0.66
|
|
|
0.03
|
|
|
4.5
|
|
|||
Landing fees and airport rentals
|
0.88
|
|
|
0.85
|
|
|
0.03
|
|
|
3.5
|
|
|||
Depreciation and amortization
|
0.74
|
|
|
0.87
|
|
|
(0.13
|
)
|
|
(14.9
|
)
|
|||
Other operating expenses
|
1.67
|
|
|
1.88
|
|
|
(0.21
|
)
|
|
(11.2
|
)
|
|||
Total
|
|
11.58
|
¢
|
|
|
11.57
|
¢
|
|
|
0.01
|
¢
|
|
0.1
|
%
|
Period
|
Maximum percent of estimated fuel consumption covered by fuel derivative contracts at varying West Texas Intermediate/Brent Crude Oil, Heating Oil, and Gulf Coast Jet Fuel-equivalent price levels (a)
|
||||
2018
|
78%
|
||||
2019
|
63%
|
||||
2020
|
38%
|
||||
2021
|
20%
|
||||
2022
|
less than 5%
|
Year
|
|
Fair value of fuel derivative contracts at March 31, 2018
|
|
Amount of gains (losses) deferred in AOCI at March 31, 2018 (net of tax)
|
||||
Remainder of 2018
|
|
$
|
114
|
|
|
$
|
6
|
|
2019
|
|
124
|
|
|
38
|
|
||
2020
|
|
74
|
|
|
18
|
|
||
2021
|
|
23
|
|
|
2
|
|
||
2022
|
|
5
|
|
|
—
|
|
||
Total
|
|
$
|
340
|
|
|
$
|
64
|
|
|
|
Estimated economic fuel price per gallon, including taxes and fuel hedging premiums (c)(e)
|
Estimated economic fuel price per gallon, including taxes and fuel hedging premiums (d)(e)
|
Average Brent Crude Oil price per barrel
|
|
Second Quarter 2018
|
Full Year 2018
|
$55
|
|
$1.85 - $1.90
|
$1.85 - $1.90
|
$65
|
|
$2.05 - $2.10
|
$2.05 - $2.10
|
Current Market (a)
|
|
Approximately $2.20
|
$2.15 - $2.20
|
$75
|
|
$2.20 - $2.25
|
$2.20 - $2.25
|
$80
|
|
$2.25 - $2.30
|
$2.25 - $2.30
|
$85
|
|
$2.30 - $2.35
|
$2.30 - $2.35
|
Estimated fuel hedging premium expense per gallon (b)
|
|
$.06
|
$.06
|
|
Three months ended March 31,
|
|
||||||
(in millions)
|
2018
|
|
2017
|
|
||||
Mark-to-market impact from fuel contracts settling in future periods
|
$
|
—
|
|
|
$
|
43
|
|
|
Ineffectiveness from fuel hedges settling in future periods (a)
|
—
|
|
|
14
|
|
|
||
Realized ineffectiveness and mark-to-market (gains) or losses (a)
|
—
|
|
|
8
|
|
|
||
Other
|
4
|
|
|
(2
|
)
|
(b)
|
||
|
$
|
4
|
|
|
$
|
63
|
|
|
|
Three months ended March 31,
|
|
Percent
|
||||||
|
2018
|
|
2017
|
|
Change
|
||||
Fuel and oil expense, unhedged
|
$
|
1,014
|
|
|
$
|
816
|
|
|
|
Premium cost of fuel contracts
|
34
|
|
|
34
|
|
|
|
||
Add (Deduct): Fuel hedge (gains) losses included in Fuel and oil expense, net
|
(30
|
)
|
|
106
|
|
|
|
||
Fuel and oil expense, as reported
|
$
|
1,018
|
|
|
$
|
956
|
|
|
|
Add: Net impact from fuel contracts
|
7
|
|
|
37
|
|
|
|
||
Fuel and oil expense, excluding special items (economic)
|
$
|
1,025
|
|
|
$
|
993
|
|
|
3.2%
|
|
|
|
|
|
|
||||
Total operating expenses, as reported
|
$
|
4,328
|
|
|
$
|
4,248
|
|
|
|
Add: Reclassification between Fuel and oil and Other (gains) losses, net, associated with current period settled contracts
|
—
|
|
|
8
|
|
|
|
||
Add: Contracts settling in the current period, but for which gains and/or (losses) have been recognized in a prior period (a)
|
7
|
|
|
29
|
|
|
|
||
Deduct: Lease termination expense
|
—
|
|
|
(5
|
)
|
|
|
||
Add: Gain on sale of grounded aircraft
|
25
|
|
|
—
|
|
|
|
||
Total operating expenses, excluding special items
|
$
|
4,360
|
|
|
$
|
4,280
|
|
|
1.9%
|
|
|
|
|
|
|
||||
Operating income, as reported
|
$
|
616
|
|
|
$
|
606
|
|
|
|
Deduct: Reclassification between Fuel and oil and Other (gains) losses, net, associated with current period settled contracts
|
—
|
|
|
(8
|
)
|
|
|
||
Deduct: Contracts settling in the current period, but for which gains and/or (losses) have been recognized in a prior period (a)
|
(7
|
)
|
|
(29
|
)
|
|
|
||
Add: Lease termination expense
|
—
|
|
|
5
|
|
|
|
||
Deduct: Gain on sale of grounded aircraft
|
(25
|
)
|
|
—
|
|
|
|
||
Operating income, excluding special items
|
$
|
584
|
|
|
$
|
574
|
|
|
1.7%
|
|
|
|
|
|
|
||||
Net income, as reported
|
$
|
463
|
|
|
$
|
339
|
|
|
|
Add: Mark-to-market impact from fuel contracts settling in future periods
|
—
|
|
|
43
|
|
|
|
||
Add: Ineffectiveness from fuel hedges settling in future periods
|
—
|
|
|
14
|
|
|
|
||
Deduct: Other net impact of fuel contracts settling in the current or a prior period (excluding reclassifications)
|
(7
|
)
|
|
(29
|
)
|
|
|
||
Add: Lease termination expense
|
—
|
|
|
5
|
|
|
|
||
Deduct: Gain on sale of grounded aircraft
|
(25
|
)
|
|
—
|
|
|
|
||
Add (Deduct): Net income tax impact from fuel and special items (b)
|
7
|
|
|
(13
|
)
|
|
|
||
Net income, excluding special items
|
$
|
438
|
|
|
$
|
359
|
|
|
22.0%
|
|
|
|
|
|
|
||||
Net income per share, diluted, as reported
|
$
|
0.79
|
|
|
$
|
0.55
|
|
|
|
Add (Deduct): Net impact to net income above from fuel contracts divided by dilutive shares
|
(0.01
|
)
|
|
0.04
|
|
|
|
||
Add (Deduct): Impact of special items
|
(0.04
|
)
|
|
0.01
|
|
|
|
||
Add (Deduct): Net income tax impact of fuel and special items (b)
|
0.01
|
|
|
(0.02
|
)
|
|
|
||
Net income per share, diluted, excluding special items
|
$
|
0.75
|
|
|
$
|
0.58
|
|
|
29.3%
|
|
|
|
|
|
|
||||
Operating expenses per ASM (cents)
|
|
11.58
|
¢
|
|
|
11.57
|
¢
|
|
|
Deduct: Fuel and oil expense divided by ASMs
|
(2.72
|
)
|
|
(2.60
|
)
|
|
|
||
Deduct: Profitsharing expense divided by ASMs
|
(0.28
|
)
|
|
(0.27
|
)
|
|
|
||
Add (Deduct): Impact of special items
|
0.07
|
|
|
(0.02
|
)
|
|
|
||
Operating expenses per ASM, excluding profitsharing, Fuel and oil expense, and special items (cents)
|
|
8.65
|
¢
|
|
|
8.68
|
¢
|
|
(0.3)%
|
|
|
|
|
|
||||
|
Twelve Months Ended
|
|
Twelve Months Ended
|
|
||||
|
March 31, 2018
|
|
March 31, 2017
|
|
||||
Operating income, as reported
|
$
|
3,417
|
|
|
$
|
3,269
|
|
|
Contract ratification bonuses
|
—
|
|
|
356
|
|
|
||
Net impact from fuel contracts
|
(125
|
)
|
|
(247
|
)
|
|
||
Asset impairment
|
—
|
|
|
21
|
|
|
||
Lease termination expense
|
28
|
|
|
27
|
|
|
||
Aircraft grounding charge
|
63
|
|
|
—
|
|
|
||
Gain on sale of grounded aircraft
|
(25
|
)
|
|
—
|
|
|
||
Operating income, non-GAAP
|
$
|
3,358
|
|
|
$
|
3,426
|
|
|
Net adjustment for aircraft leases (a)
|
107
|
|
|
109
|
|
|
||
Adjusted operating income, non-GAAP (A)
|
$
|
3,465
|
|
|
$
|
3,535
|
|
|
|
|
|
|
|
||||
Non-GAAP tax rate (B)
|
23.1
|
%
|
(d)
|
36.6
|
%
|
(e)
|
||
|
|
|
|
|
||||
Net operating profit after-tax, NOPAT (A* (1-B) = C)
|
$
|
2,665
|
|
|
$
|
2,241
|
|
|
|
|
|
|
|
||||
Debt, including capital leases (b)
|
$
|
3,300
|
|
|
$
|
3,282
|
|
|
Equity (b)
|
8,561
|
|
|
7,350
|
|
|
||
Net present value of aircraft operating leases (b)
|
732
|
|
|
957
|
|
|
||
Average invested capital
|
$
|
12,593
|
|
|
$
|
11,589
|
|
|
Equity adjustment for hedge accounting (c)
|
196
|
|
|
698
|
|
|
||
Adjusted average invested capital (D)
|
$
|
12,789
|
|
|
$
|
12,287
|
|
|
|
|
|
|
|
||||
Non-GAAP ROIC, pre-tax (A/D)
|
27.1
|
%
|
|
28.8
|
%
|
|
||
|
|
|
|
|
||||
Non-GAAP ROIC, after tax (C/D)
|
20.8
|
%
|
|
18.2
|
%
|
|
1.
|
Contract ratification 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;
|
2.
|
A noncash impairment charge related to leased slots at Newark Liberty International Airport as a result of the FAA announcement in April 2016 that this airport was being changed to a Level 2 schedule-facilitated airport
|
3.
|
Lease termination costs recorded as a result of the Company acquiring
13
of its Boeing 737-300 aircraft off operating leases as part of the Company's strategic effort to remove its Classic aircraft from operations on or before September 29, 2017, in the most economically advantageous manner possible. The Company had not budgeted for these early lease termination costs, as they were subject to negotiations being concluded with the third party lessors. The Company recorded the fair value of the aircraft acquired off operating leases, as well as any associated remaining obligations to the balance sheet as debt;
|
4.
|
An Aircraft grounding charge recorded in third quarter 2017, as a result of the Company grounding its remaining Boeing 737-300 aircraft on September 29, 2017. The loss was a result of the remaining net lease payments due and certain lease return requirements that could have to be performed on these leased aircraft prior to their return to the lessors as of the cease-use date. The Company had not budgeted for the lease return requirements, as they are subject to negotiation with third party lessors; and
|
5.
|
A gain recognized in first quarter 2018, associated with the sale of 39 owned Boeing 737–300 aircraft and a number of spare engines to a third party. These aircraft were previously retired as part of the Company's exit of its Classic fleet. The gain was not anticipated, and the Company associates it in conjunction with the grounding charge recorded in third quarter 2017.
|
|
|
|
|
Average
Age (Yrs)
|
|
Number
of Aircraft
|
|
Number
Owned
|
|
Number
Leased
|
||||
Type
|
|
Seats
|
|
|
|
|
||||||||
737-700
|
|
143
|
|
14
|
|
|
513
|
|
|
397
|
|
|
116
|
|
737-800
|
|
175
|
|
3
|
|
|
190
|
|
|
183
|
|
|
7
|
|
737 MAX 8
|
|
175
|
|
—
|
|
|
14
|
|
|
14
|
|
|
—
|
|
Totals
|
|
|
|
11
|
|
|
717
|
|
|
594
|
|
|
123
|
|
•
|
Allocation of Passenger Revenue
- Revenues from Passengers related to travel who also earn Rapid Rewards Points has been allocated between flight and Rapid Rewards Points based on each obligation’s relative standalone selling price. The Company utilizes historical earnings patterns to assist in this allocation.
|
•
|
Fair Value of Rapid Rewards Points
is determined from the base fare value of tickets which were purchased using prior point redemptions for travel and other products and services, which the Company believes to be indicative of the fair value of points as perceived by Customers and representative of the value of each point at the time of redemption. The Company’s booking site allows a Customer to toggle between fares utilizing either cash or point redemptions, which provide the Customer with an approximation of the equivalent value of their points. The value can differ however, based on demand, the amount of time prior to the flight, and other factors. The fare mix during the period measured represents a constraint, which could result in the assumptions above changing at the measurement date, as fare classes can have different coefficients used to determine the total frequent flyer points needed to purchase an award ticket. The mixture of these fare classes could cause the fair value per point to increase or decrease.
|
•
|
the Company’s fleet and capacity plans and related expectations;
|
•
|
the Company’s network and schedule optimization plans and strategies;
|
•
|
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 its anticipated sources of funds;
|
•
|
the Company’s critical accounting policies and related estimates and assumptions;
|
•
|
the Company's assessment of market risks; and
|
•
|
the Company's plans and expectations related to legal and regulatory proceedings.
|
•
|
the Company's dependence on third parties, in particular with respect to its fleet and technology plans and expectations;
|
•
|
the impact of changes in consumer behavior, actions of competitors (including, without limitation, pricing, scheduling, capacity and network decisions, and consolidation and alliance activities), fuel prices, economic conditions, natural disasters, and other factors beyond the Company’s control on the Company's business decisions, plans, and strategies;
|
•
|
the impact of governmental regulations and other governmental actions related to the Company and its operations;
|
•
|
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;
|
•
|
changes in the price of aircraft fuel, the volatility of commodities used by the Company for hedging jet fuel, and any changes to the Company's fuel hedging strategies and positions;
|
•
|
the Company’s ability to timely and effectively prioritize its initiatives and related expenditures; 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, 2017.
|
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
|
|
|
|
|
||||||||||
January 1, 2018 through
January 31, 2018
|
|
736,838
|
|
|
$
|
—
|
|
(2)(3)
|
736,838
|
|
|
$
|
850,032,588
|
|
February 1, 2018 through
February 28, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
850,032,588
|
|
March 1, 2018 through
March 31, 2018
|
|
7,588,824
|
|
|
$
|
—
|
|
(3)
|
7,588,824
|
|
|
$
|
850,032,588
|
|
Total
|
|
8,325,662
|
|
|
|
|
8,325,662
|
|
|
|
(1)
|
On May 17, 2017, 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 an accelerated share repurchase program entered into by the Company with a third party financial institution in fourth quarter 2017 (the "Fourth Quarter 2017 ASR Program"), the Company paid $250 million and received an initial delivery of 3,323,537 shares during December 2017, representing an estimated 75 percent of the shares to be purchased by the Company under the Fourth Quarter 2017 ASR Program based on a volume-weighted average price of $56.4158 per share of the Company’s common stock on the New York Stock Exchange during a calculation period between November 8, 2017 and December 6, 2017. Final settlement of the Fourth Quarter 2017 ASR Program occurred in January 2018 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 January 2018. Upon settlement, the third party financial institution delivered 736,838 additional shares of the Company’s common stock to the Company. In total, the average purchase price per share for the 4,060,375 shares repurchased under the Fourth Quarter 2017 ASR Program, upon completion of the Fourth Quarter 2017 ASR Program in January 2018, was $61.5707.
|
(3)
|
Under the First Quarter 2018 ASR Program, the Company paid $500 million in January 2018 and received an initial delivery of 6,468,663 shares during March 2018, representing an estimated 75 percent of the shares to be purchased by the Company under the First Quarter 2018 ASR Program based on a volume-weighted average price of $57.9718 per share of the Company’s common stock on the New York Stock Exchange during a calculation period between February 1, 2018 and March 7, 2018. The third party financial institution delivered an additional 1,120,161 shares to the Company in further partial settlement of the First Quarter 2018 ASR Program in March 2018, which 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 March 2018. Final settlement of the First Quarter 2018 ASR Program occurred in April 2018 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 March 2018. Upon settlement, the third party financial institution delivered 1,137,702 additional shares of the Company’s common stock to the Company. In total, the average purchase price per share for the 8,726,526 shares repurchased under the First Quarter 2018 ASR Program, upon completion of the First Quarter 2018 ASR Program in April 2018, was $57.2966.
|
3.1
|
|
3.2
|
|
10.1
|
|
10.2
|
|
10.3
|
|
31.1
|
|
31.2
|
|
32.1
|
|
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.
|
|
|
|
|
May 1, 2018
|
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)
|
Supplemental Agreement No. 104
|
|
to
|
|
Purchase Agreement No. 1810
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-7H4 and 737-8H4 Aircraft
|
RECITALS
:
|
P.A. No. 1810
|
SA-104-
1
|
|
|
BOEING PROPRIETARY
|
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
By:
/s/ Kyle Kersavage
|
By:
/s/ Chris Monroe
|
|
|
Its:
Attorney‑In‑Fact
|
Its:
Chris Monroe
|
|
SVP, Finance
|
P.A. No. 1810
|
SA-104-
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
|
|
|
|
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-
104
|
TABLE OF CONTENTS
|
|
|
SA
|
|
Number
|
TABLE
|
1b
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-82
|
|
||
1c
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-100
|
|
(non-ETOPS Configuration)
|
|
|
||
1d
|
Aircraft Information Table - Block 800LUV Aircraft
|
SA-104
|
|
(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-101
|
|
|
|||
F
|
Defined Terms Document
|
||
|
|
|
|
LETTER AGREEMENTS
|
|
|
|
|
|
|
|
1810-1R1
|
Waiver of Aircraft Demonstration Flight
|
SA-75
|
P.A. No. 1810
|
ii
|
|
K/SWA
|
|
SA-
104
|
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-100
|
|
|
|||
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-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
|
|
|
|||
SWA-PA-1810-LA-1801210
|
Revision to Contract delivery Month of
|
SA-104
|
|
|
One (1) 737-8H4 (MSN 64348)
|
|
P.A. No. 1810
|
iii
|
|
K/SWA
|
|
SA-
104
|
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
|
iv
|
|
K/SWA
|
|
SA-
104
|
TABLE OF CONTENTS
|
|||
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
|
v
|
|
K/SWA
|
|
SA-
104
|
P.A. No. 1810
|
vi
|
|
K/SWA
|
|
SA-
104
|
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
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2017
|
1
|
***
|
63576
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
2
|
***
|
63577, 63578
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
3
|
***
|
63596, 63595,
63598
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
2
|
***
|
63571, 63586
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2017
|
1
|
***
|
63599
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
1
|
***
|
63581
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
1
|
***
|
63587
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
2
|
***
|
63573, 63574
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
63572
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-104
|
SWA-PA-01810 82233 / 88233 93899
|
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
***
|
|||||||
Oct-2017
|
1
|
***
|
63579
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
63597
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
1
|
***
|
63580
|
***
|
|
***
|
***
|
***
|
***
|
***
|
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
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
1
|
***
|
64248
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
63588, 63589
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2018
|
2
|
***
|
64251, 64250
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
63590, 63591
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
2
|
***
|
64350, 64349
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
1
|
***
|
64347
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
1
|
***
|
64348
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
64799, 64800,
64801
|
***
|
OPEX
|
***
|
***
|
***
|
***
|
***
|
Total:
|
|
47
|
|
|
SA-104
|
SWA-PA-01810 82233 / 88233 93899
|
Boeing Proprietary
|
Page
2
|
|
|
The Boeing Company
|
|
P. O. Box 3707
|
|
|
Seattle, WA 98124-2207
|
|
|
|
Subject:
|
Revision to Contract Delivery Month of One (1) 737-8H4 (MSN 64348)
|
Reference:
|
Purchase Agreement No. PA-1810 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Southwest Airlines Co. (
Customer
) relating to Model 737-7H4 and 737-8H4 aircraft (
Aircraft
)
|
1.
|
Re-contracted Firm Aircraft
.
|
2.
|
Confidential Treatment
.
|
|
|
Page 1
|
|
BOEING PROPRIETARY
|
|
|
|
|
|
|
|
|
|
|
|
|
THE BOEING COMPANY
|
||
|
|
|
By
|
/s/ Kyle Kersavage
|
|
Its
|
Attorney‑In‑Fact
|
|
|
|
|
ACCEPTED AND AGREED TO this
|
||
|
|
|
Date:
|
February 22, 2018
|
|
|
||
SOUTHWEST AIRLINES CO.
|
||
|
|
|
By
|
/s/ Chris Monroe
|
|
|
|
|
Its
|
Chris Monroe
|
|
|
SVP, Finance
|
SWA-PA-1810-LA-1801210
|
|
Page 2
|
|
BOEING PROPRIETARY
|
|
|
|
|
Supplemental Agreement No. 9
|
|
to
|
|
Purchase Agreement No. 03729
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-8 and 737-7 Aircraft
|
RECITALS
:
|
1.
|
TABLE OF CONTENTS
.
|
2.
|
TABLES
.
|
SWA-PA-03729
|
1
|
SA-8
|
|
BOEING PROPRIETARY
|
|
|
|
|
EXECUTED IN DUPLICATE as of the day and year first above written.
|
|
|
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
|
|
By:
/s/ Kyle Kersavage
|
By:
/s/ Chris Monroe
|
|
|
Its:
Attorney-In-Fact
|
Its:
Chris Monroe
|
|
SVP, Finance
|
SWA-PA-03729
|
2
|
SA-9
|
|
BOEING PROPRIETARY
|
|
TABLE OF CONTENTS
|
ARTICLES
|
TITLES
|
|
|
|
|
Article 1
|
Quantity, Model and Description
|
SA-2
|
|
|
|
Article 2
|
Delivery Schedule
|
|
|
|
|
Article 3
|
Price
|
|
|
|
|
Article 4
|
Payment
|
SA-2
|
|
|
|
Article 5
|
Additional Terms
|
|
|
|
|
TABLE
|
TITLE
|
|
|
|
|
1A
|
737-8 Aircraft Information Table
|
SA-9
|
|
|
|
1B
|
737-7 Aircraft Information Table
|
SA-8
|
|
|
|
EXHIBIT
|
||
|
|
|
A1
|
737-8 Aircraft Configuration
|
SA-8
|
|
|
|
A2
|
737-7 Aircraft Configuration
|
SA-8
|
|
|
|
B*
|
Aircraft Delivery Requirements and Responsibilities
|
|
|
|
|
SUPPLEMENTAL EXHIBITS
|
TITLES
|
|
|
|
|
AE1*
|
Escalation Adjustment/Airframe and Optional Features
|
|
|
|
|
BFE1
|
BFE Variables for 737-8
|
SA-7
|
|
|
|
BFE2
|
BFE Variables for 737-7
|
SA-8
|
|
|
|
CS1
|
Customer Support Variables
|
|
|
|
|
CS1-7MAX
|
Customer Support Variables
|
SA-2
|
|
|
|
EE1*
|
Engine Escalation/Engine Warranty and Patent Indemnity
|
|
|
|
|
SLP1*
|
Service Life Policy Components
|
LETTER AGREEMENTS
|
TITLES
|
|
SWA-PA-03729-LA-1106463R3
|
Open Matters
|
SA-8
|
SWA-PA-03729
|
|
SA-9
|
|
BOEING PROPRIETARY
|
Page
1
|
LETTER AGREEMENTS
|
TITLES
|
|
|
|
|
SWA-PA-03729-LA-1106464*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106465*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106466
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106467R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106468*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106469R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106470R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106471R1
|
Substitute Aircraft
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106473R1
|
***
|
SA-5
|
|
|
|
SWA-PA-03729-LA-1106474R2
|
Option Aircraft
|
SA-8
|
|
Attachment 1
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106475R3
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106476R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106477*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106478
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106479R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106480R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106481R2
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106482*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106483*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106484R1
|
***
|
SA-8
|
|
Attachment A
|
SA-8
|
|
Attachment B
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106485*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1209080
|
***
|
SA-1
|
SWA-PA-03729
|
|
SA-9
|
|
BOEING PROPRIETARY
|
Page
2
|
LETTER AGREEMENTS
|
TITLES
|
|
|
|
|
SWA-PA-03729-LA-1210419
|
***
|
SA-1
|
|
|
|
SWA-PA-03729-LA-1300943
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1301168R3
|
***
|
SA-6
|
|
|
|
SWA-PA-03729-LA-1301170R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1400371
|
***
|
SA-7
|
|
|
|
SWA-PA-03729-LA-1503792
|
Service Ready Operational Validation
|
SA-6
|
|
|
|
SWA-PA-03729-LA-1500831
|
***
|
SA-7
|
|
|
|
SWA‑PA‑03729‑LA‑1602486
|
***
|
SA-5
|
SWA-PA-03729
|
|
SA-9
|
|
BOEING PROPRIETARY
|
Page
3
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
SWA-PA-03729-LA-1106472R1
|
***
|
SA-2
|
Deleted under SA-4
|
SWA-PA-01810/03729-LA-1301169
|
***
|
SA-2
|
Deleted under SA-4
|
SWA-PA-03729
|
|
SA-9
|
|
BOEING PROPRIETARY
|
Page
4
|
Airframe Model/MTOW:
|
737-8
|
181,200 pounds
|
|
Detail Specification:
|
|
D019A008-P (5/1/2017)
|
|
|
Engine Model/Thrust:
|
CFMLEAP-1B288
(2)
|
28,800 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:
|
|
***
|
|
|
|
|
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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
***
|
||||||||
Jul-2017
|
1
|
***
|
36929†
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
2
|
***
|
42558†, 42559†
|
***
|
C
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
3
|
***
|
36979, 36930, 36984
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
3
|
***
|
42563, 42566†, 42567
|
***
|
C
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
36934
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
42544
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
42570
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
1
|
***
|
36988†
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
1
|
***
|
42554†
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
36989†
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
42571
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
1
|
***
|
42546
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
1
|
***
|
42572
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
1
|
***
|
42547
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
1
|
***
|
42556†
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
42548, 37019, 42549
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
1
|
***
|
42574
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
1
|
***
|
42575
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2018
|
2
|
***
|
42573, 42576
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
1
|
***
|
42577
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-9
|
SWA-PA-03729 107813 /
108198
|
Boeing Proprietary
|
Page
1
|
|
Table 1A To
|
|
|
Purchase Agreement No. PA-03729
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
737-8 Aircraft
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2018
|
4
|
***
|
37042, 42550, 42551, 37043
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2019
|
2
|
***
|
65437, 65436
|
***
|
E OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2019
|
2
|
***
|
65471, 65438
|
***
|
E OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2019
|
1
|
***
|
65439
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2019
|
1
|
***
|
65440
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2019
|
1
|
***
|
42536
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2019
|
1
|
***
|
65473
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2019
|
1
|
***
|
36722
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2019
|
1
|
***
|
42537
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2020
|
1
|
***
|
36727
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2020
|
2
|
***
|
42579, 42580
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2020
|
1
|
***
|
42539
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2020
|
1
|
***
|
65441
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2020
|
1
|
***
|
42553
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
May-2020
|
1
|
***
|
35970
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2020
|
1
|
***
|
42607
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2020
|
1
|
***
|
65442
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2020
|
1
|
***
|
42540
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2020
|
2
|
***
|
65443, 65444
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2020
|
1
|
***
|
42541
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2020
|
2
|
***
|
65445, 65446
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2020
|
1
|
***
|
33941
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2020
|
3
|
***
|
65447, 65448, 65472
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
42615
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
42543
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
65474
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2020
|
1
|
***
|
36733
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2020
|
1
|
***
|
65475
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2020
|
1
|
***
|
33940
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2021
|
1
|
***
|
35974
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2021
|
1
|
***
|
65450
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-9
|
SWA-PA-03729 107813 /
108198
|
Boeing Proprietary
|
Page
2
|
|
Table 1A To
|
|
|
Purchase Agreement No. PA-03729
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
737-8 Aircraft
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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
***
|
||||||||
Jan-2021
|
1
|
***
|
65449
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2021
|
1
|
***
|
65451
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2021
|
1
|
***
|
42648
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2021
|
1
|
***
|
65452
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
3
|
***
|
42649, 42650, 42651
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
1
|
***
|
65454
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
1
|
***
|
65453
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
3
|
***
|
42652, 42653, 42654
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
1
|
***
|
65455
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
1
|
***
|
65456
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2021
|
3
|
***
|
42655, 42656, 42670
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2021
|
1
|
***
|
65457
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
3
|
***
|
42657, 42658, 42671
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
1
|
***
|
65460
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
2
|
***
|
65459, 65458
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2021
|
1
|
***
|
65461
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2021
|
2
|
***
|
65463, 65462
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2021
|
1
|
***
|
65466
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2021
|
2
|
***
|
65465, 65464
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2021
|
1
|
***
|
65467
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2021
|
1
|
***
|
65468
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2022
|
1
|
***
|
65469
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2022
|
1
|
***
|
65470
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2022
|
2
|
***
|
42678, 42679
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2022
|
3
|
***
|
42680, 42681, 42688
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2022
|
3
|
***
|
42682, 42683, 42684
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2022
|
3
|
***
|
42685, 42686, 42687
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2022
|
2
|
***
|
42689, 42690
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2022
|
2
|
***
|
42693, 42695
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2023
|
2
|
***
|
42560, 42565
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2023
|
2
|
***
|
42562, 42564
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-9
|
SWA-PA-03729 107813 /
108198
|
Boeing Proprietary
|
Page
3
|
|
Table 1A To
|
|
|
Purchase Agreement No. PA-03729
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
737-8 Aircraft
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2023
|
1
|
***
|
42557
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2023
|
1
|
***
|
36732
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
42555
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
38806
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
May-2023
|
2
|
***
|
42594, 42568
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
42581
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
37034
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2023
|
2
|
***
|
42597, 42582
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
42593
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
42552
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2023
|
2
|
***
|
42601, 42578
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
42605
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
42538
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2023
|
1
|
***
|
38815
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2023
|
1
|
***
|
42583
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2024
|
3
|
***
|
42611, 42584, 42585
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2024
|
3
|
***
|
42612, 42596, 42599
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2024
|
3
|
***
|
38817, 35968, 35972
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
2
|
***
|
42617, 42606
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
1
|
***
|
36736
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
May-2024
|
3
|
***
|
42619, 42622, 42608
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
42610
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
42542
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2024
|
2
|
***
|
35963, 35967
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2024
|
2
|
***
|
42624, 42626
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
42630
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
36730
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2024
|
2
|
***
|
42625, 42636
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
42639
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
35971
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2024
|
2
|
***
|
42628, 42640
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-9
|
SWA-PA-03729 107813 /
108198
|
Boeing Proprietary
|
Page
4
|
|
Table 1A To
|
|
|
Purchase Agreement No. PA-03729
|
|
|
Aircraft Delivery, Description, Price and Advance Payments
|
|
|
737-8 Aircraft
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2024
|
1
|
***
|
35975
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2025
|
2
|
***
|
42633, 42634
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2025
|
2
|
***
|
38804, 38805
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
3
|
***
|
42637, 42641, 42643
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
1
|
***
|
36729
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2025
|
4
|
***
|
42644, 42645, 42646, 42647
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2025
|
4
|
***
|
42659, 42660, 42661, 42662
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2025
|
3
|
***
|
42663, 42664, 42666
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2025
|
3
|
***
|
42665, 42667, 42669
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2025
|
3
|
***
|
42668, 42672, 42673
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2025
|
3
|
***
|
42674, 42675, 42691
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2025
|
3
|
***
|
42676, 42677, 42694
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2025
|
3
|
***
|
42692, 42696, 42697
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2025
|
3
|
***
|
42698, 42699, 42700
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2025
|
3
|
***
|
42701, 42702, 42703
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
|
210
|
|
|
SA-9
|
SWA-PA-03729 107813 /
108198
|
Boeing Proprietary
|
Page
5
|
|
|
|
Supplemental Agreement No. 10
|
|
to
|
|
Purchase Agreement No. 03729
|
|
between
|
|
THE BOEING COMPANY
|
|
and
|
|
SOUTHWEST AIRLINES CO.
|
|
Relating to Boeing Model 737-8 and 737-7 Aircraft
|
RECITALS
:
|
SWA-PA-03729
|
1
|
SA-10
|
|
BOEING PROPRIETARY
|
|
|
|
|
EXECUTED IN DUPLICATE as of the day and year first above written.
|
|
|
|
THE BOEING COMPANY
|
SOUTHWEST AIRLINES CO.
|
|
|
|
|
By:
/s/ Kyle Kersavage
|
By:
/s/ Chris Monroe
|
|
Chris Monroe
|
Its:
Attorney-In-Fact
|
Its:
SVP, Finance
|
SWA-PA-03729
|
2
|
SA-10
|
|
BOEING PROPRIETARY
|
|
TABLE OF CONTENTS
|
ARTICLES
|
TITLES
|
|
|
|
|
Article 1
|
Quantity, Model and Description
|
SA-2
|
|
|
|
Article 2
|
Delivery Schedule
|
|
|
|
|
Article 3
|
Price
|
|
|
|
|
Article 4
|
Payment
|
SA-2
|
|
|
|
Article 5
|
Additional Terms
|
|
|
|
|
TABLE
|
TITLE
|
|
|
|
|
1A
|
737-8 Aircraft Information Table
|
SA-10
|
|
|
|
1B
|
737-7 Aircraft Information Table
|
SA-8
|
|
|
|
EXHIBIT
|
||
|
|
|
A1
|
737-8 Aircraft Configuration
|
SA-8
|
|
|
|
A2
|
737-7 Aircraft Configuration
|
SA-8
|
|
|
|
B*
|
Aircraft Delivery Requirements and Responsibilities
|
|
|
|
|
SUPPLEMENTAL EXHIBITS
|
TITLES
|
|
|
|
|
AE1*
|
Escalation Adjustment/Airframe and Optional Features
|
|
|
|
|
BFE1
|
BFE Variables for 737-8
|
SA-7
|
|
|
|
BFE2
|
BFE Variables for 737-7
|
SA-8
|
|
|
|
CS1
|
Customer Support Variables
|
|
|
|
|
CS1-7MAX
|
Customer Support Variables
|
SA-2
|
|
|
|
EE1*
|
Engine Escalation/Engine Warranty and Patent Indemnity
|
|
|
|
|
SLP1*
|
Service Life Policy Components
|
LETTER AGREEMENTS
|
TITLES
|
|
SWA-PA-03729-LA-1106463R3
|
Open Matters
|
SA-8
|
SWA-PA-03729
|
|
SA-10
|
|
BOEING PROPRIETARY
|
Page
1
|
LETTER AGREEMENTS
|
TITLES
|
|
|
|
|
SWA-PA-03729-LA-1106464*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106465*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106466
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106467R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106468*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106469R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106470R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106471R1
|
Substitute Aircraft
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106473R1
|
***
|
SA-5
|
|
|
|
SWA-PA-03729-LA-1106474R2
|
Option Aircraft
|
SA-8
|
|
Attachment 1
|
SA-10
|
|
|
|
SWA-PA-03729-LA-1106475R3
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106476R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106477*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106478
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106479R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106480R1
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106481R2
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1106482*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106483*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1106484R1
|
***
|
SA-8
|
|
Attachment A
|
SA-8
|
|
Attachment B
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1106485*
|
***
|
|
|
|
|
SWA-PA-03729-LA-1209080
|
***
|
SA-1
|
|
|
|
SWA-PA-03729
|
|
SA-10
|
|
BOEING PROPRIETARY
|
Page
2
|
LETTER AGREEMENTS
|
TITLES
|
|
|
|
|
SWA-PA-03729-LA-1210419
|
***
|
|
|
|
SA-1
|
|
|
|
SWA-PA-03729-LA-1300943
|
***
|
SA-2
|
|
|
|
SWA-PA-03729-LA-1301168R3
|
***
|
SA-6
|
|
|
|
SWA-PA-03729-LA-1301170R2
|
***
|
SA-8
|
|
|
|
SWA-PA-03729-LA-1400371
|
***
|
SA-7
|
|
|
|
SASWA-PA-03729-LA-1503792
|
Service Ready Operational Validation
|
SA-6
|
|
|
|
SWA-PA-03729-LA-1500831
|
***
|
SA-7
|
|
|
|
SWA‑PA‑03729‑LA‑1602486
|
***
|
SA-5
|
SWA-PA-03729
|
|
SA-10
|
|
BOEING PROPRIETARY
|
Page
3
|
Letter Agreement
|
Title
|
Last Updated under SA
|
Current Status
|
SWA-PA-03729-LA- 1106472R1
|
***
|
SA-2
|
Deleted under SA-4
|
SWA-PA- 01810/03729-LA- 1301169
|
***
|
SA-2
|
Deleted under SA-4
|
SWA-PA-03729
|
|
SA-10
|
|
BOEING PROPRIETARY
|
Page
4
|
Airframe Model/MTOW:
|
737-8
|
181,200 pounds
|
|
Detail Specification:
|
|
D019A008-P (5/1/2017)
|
|
|
|
Engine Model/Thrust:
|
CFMLEAP-1B28
(2)
|
28,800 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:
|
|
***
|
|
|
|
|
|
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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
***
|
||||||||
Jul-2017
|
1
|
***
|
36929†
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Jul-2017
|
2
|
***
|
42558†, 42559†
|
***
|
C
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
3
|
***
|
36979, 36930, 36984
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Aug-2017
|
3
|
***
|
42563, 42566†, 42567
|
***
|
C
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Sep-2017
|
1
|
***
|
36934
|
***
|
A
|
Note 1
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
42544
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2017
|
1
|
***
|
42570
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2017
|
1
|
***
|
36988†
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2017
|
1
|
***
|
42554†
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
36989†
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2018
|
1
|
***
|
42571
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2018
|
1
|
***
|
42546
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
1
|
***
|
42572
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2018
|
1
|
***
|
42547
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2018
|
1
|
***
|
42556†
|
***
|
C
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
3
|
***
|
42548, 37019, 42549
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
1
|
***
|
42574
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2018
|
1
|
***
|
42575
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2018
|
2
|
***
|
42573, 42576
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
1
|
***
|
42577
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2018
|
4
|
***
|
37042, 42550, 42551, 37043
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2019
|
1
|
***
|
42633
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2019
|
2
|
***
|
65437, 65436
|
***
|
E OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2019
|
3
|
***
|
42634, 42637, 42641
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2019
|
2
|
***
|
65471, 65438
|
***
|
E OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2019
|
4
|
***
|
42646, 42647, 42661, 42662
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2019
|
1
|
***
|
65439
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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
***
|
||||||||
Oct-2019
|
1
|
***
|
65440
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2019
|
1
|
***
|
42664
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2019
|
1
|
***
|
42536
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2019
|
1
|
***
|
65473
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2019
|
1
|
***
|
42666
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2019
|
1
|
***
|
36722
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2019
|
1
|
***
|
42537
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2020
|
1
|
***
|
36727
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2020
|
2
|
***
|
42579, 42580
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2020
|
1
|
***
|
42539
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2020
|
1
|
***
|
65441
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2020
|
1
|
***
|
42669
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2020
|
1
|
***
|
42553
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
May-2020
|
1
|
***
|
35970
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2020
|
1
|
***
|
42607
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2020
|
1
|
***
|
65442
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2020
|
1
|
***
|
42665
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2020
|
1
|
***
|
42540
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2020
|
2
|
***
|
65443, 65444
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2020
|
2
|
***
|
42672, 42673
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2020
|
1
|
***
|
42541
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2020
|
2
|
***
|
65445, 65446
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2020
|
3
|
***
|
42691, 42674, 42694
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2020
|
1
|
***
|
33941
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2020
|
3
|
***
|
65447, 65448, 65472
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
42615
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
42543
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2020
|
1
|
***
|
65474
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2020
|
2
|
***
|
42697, 42699
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2020
|
1
|
***
|
36733
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2020
|
1
|
***
|
65475
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2020
|
1
|
***
|
42703
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2020
|
1
|
***
|
33940
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2021
|
1
|
***
|
35974
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2021
|
1
|
***
|
65450
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2021
|
1
|
***
|
65449
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2021
|
1
|
***
|
65451
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2021
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2021
|
1
|
***
|
42648
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2021
|
1
|
***
|
65452
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
3
|
***
|
42649, 42650, 42651
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
1
|
***
|
65454
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2021
|
1
|
***
|
65453
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
3
|
***
|
42652, 42653, 42654
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
1
|
***
|
65455
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
May-2021
|
1
|
***
|
65456
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2021
|
3
|
***
|
42655, 42656, 42670
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2021
|
1
|
***
|
65457
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
3
|
***
|
42657, 42658, 42671
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
1
|
***
|
65460
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
2
|
***
|
65459, 65458
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2021
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Aug-2021
|
1
|
***
|
65461
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2021
|
4
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Sep-2021
|
2
|
***
|
65463, 65462
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2021
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Oct-2021
|
1
|
***
|
65466
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2021
|
2
|
***
|
65465, 65464
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2021
|
1
|
***
|
65467
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2021
|
1
|
***
|
65468
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2021
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Jan-2022
|
1
|
***
|
65469
|
***
|
D OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2022
|
1
|
***
|
65470
|
***
|
OPEX
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2022
|
2
|
***
|
42678, 42679
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2022
|
3
|
***
|
42680, 42681, 42688
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2022
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
May-2022
|
3
|
***
|
42682, 42683, 42684
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2022
|
3
|
***
|
42685, 42686, 42687
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2022
|
2
|
***
|
42689, 42690
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2022
|
3
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Aug-2022
|
2
|
***
|
42693, 42695
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2022
|
3
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Oct-2022
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Dec-2022
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Jan-2023
|
2
|
***
|
42560, 42565
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2023
|
2
|
***
|
42562, 42564
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2023
|
1
|
***
|
42557
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2023
|
1
|
***
|
36732
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
42555
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
38806
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
May-2023
|
2
|
***
|
42594, 42568
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
42581
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
37034
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2023
|
2
|
***
|
42597, 42582
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
42593
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
42552
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2023
|
2
|
***
|
42601, 42578
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
42605
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
42538
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2023
|
1
|
***
|
38815
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2023
|
1
|
***
|
42583
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2024
|
3
|
***
|
42611, 42584, 42585
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2024
|
3
|
***
|
42612, 42596, 42599
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2024
|
3
|
***
|
38817, 35968, 35972
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
2
|
***
|
42617, 42606
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
1
|
***
|
36736
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
May-2024
|
3
|
***
|
42619, 42622, 42608
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
42610
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
42542
|
***
|
A
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2024
|
2
|
***
|
35963, 35967
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2024
|
2
|
***
|
42624, 42626
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
42630
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
36730
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2024
|
2
|
***
|
42625, 42636
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
42639
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
35971
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2024
|
2
|
***
|
42628, 42640
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2024
|
1
|
***
|
35975
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2025
|
2
|
***
|
38804, 38805
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
1
|
***
|
42643
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
1
|
***
|
36729
|
***
|
B
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Mar-2025
|
2
|
***
|
42644, 42645
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Manufacturer
Serial
Number**
|
Escalation
Factor
|
Aircraft
Block
|
Notes
|
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-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Apr-2025
|
2
|
***
|
42659, 42660
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
May-2025
|
1
|
***
|
42663
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
May-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Jun-2025
|
1
|
***
|
42667
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Jul-2025
|
1
|
***
|
42668
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Aug-2025
|
1
|
***
|
42675
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2025
|
2
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Sep-2025
|
2
|
***
|
42676, 42677
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2025
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Oct-2025
|
2
|
***
|
42692, 42696
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2025
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Nov-2025
|
2
|
***
|
42698, 42700
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2025
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Dec-2025
|
2
|
***
|
42701, 42702
|
***
|
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2025
|
1
|
***
|
|
***
|
OPEX
|
Note 3
|
***
|
***
|
***
|
***
|
***
|
Total:
|
|
250
|
|
|
SA-10
|
SWA-PA-03729 107813 / 108198
/ 108732
|
|
Page
5
|
|
Boeing Proprietary
|
|
|
Attachment 1 To
|
|
|
Letter Agreement No. LA 1106474
|
|
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
Airframe Model/MTOW:
|
737-8
|
181,200 pounds
|
|
Detail Specification:
|
|
D019A008-P (5/1/2017)
|
|
4Q16 External Fcst
|
Engine Model/Thrust:
|
CFMLEAP-1B28
(1)
|
28,800 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:
|
|
***
|
|
|
|
|
|
|
Non-Refundable Deposit/Aircraft at Def Agreemt:
|
|
***
|
|
|
|
|
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise Date
Deadline
|
Aircraft
Block
|
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-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
May-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Jul-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Aug-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Oct-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Nov-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Dec-2022
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2022
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-10
|
SWA-PA-03729-LA1106474 107813.TXT
|
Boeing Proprietary
|
Page
1
|
|
Attachment 1 To
|
|
|
Letter Agreement No. LA 1106474
|
|
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise Date
Deadline
|
Aircraft
Block
|
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
***
|
||||||
Jan-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Feb-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Mar-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
May-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Jul-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Aug-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Sep-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Oct-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Nov-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2023
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Dec-2023
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Jan-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-10
|
SWA-PA-03729-LA1106474 107813.TXT
|
Boeing Proprietary
|
Page
2
|
|
Attachment 1 To
|
|
|
Letter Agreement No. LA 1106474
|
|
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise Date
Deadline
|
Aircraft
Block
|
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-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Feb-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Mar-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Apr-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
May-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Jun-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Aug-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Oct-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2024
|
1
|
***
|
***
|
D
|
***
|
***
|
***
|
***
|
***
|
Dec-2024
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
|
|
SA-10
|
SWA-PA-03729-LA1106474 107813.TXT
|
Boeing Proprietary
|
Page
3
|
|
Attachment 1 To
|
|
|
Letter Agreement No. LA 1106474
|
|
|
Option Aircraft Delivery, Description, Price and Advance Payments
|
|
Delivery
Date*
|
Number of
Aircraft
|
Escalation
Factor
(Airframe)
|
Option
Exercise Date
Deadline
|
Aircraft
Block
|
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
***
|
||||||
Jun-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2025
|
3
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jan-2026
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Feb-2026
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Mar-2026
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Apr-2026
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
May-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jun-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Jul-2026
|
1
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Aug-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Sep-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Oct-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Nov-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Dec-2026
|
2
|
***
|
***
|
|
***
|
***
|
***
|
***
|
***
|
Total:
|
|
115
|
|
|
SA-10
|
SWA-PA-03729-LA1106474 107813.TXT
|
Boeing Proprietary
|
Page
4
|
|
By:
|
/s/ Gary C. Kelly
|
|
|
Gary C. Kelly
|
|
|
Chief Executive Officer
|
|
By:
|
/s/ Tammy Romo
|
|
|
Tammy Romo
|
|
|
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
|