Air Canada 2006 Annual Report Download - page 47

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Pursuant to a component maintenance agreement (the “ACTS-Jazz Agreement”) dated August 1, 2005
between Jazz and ACTS, ACTS provides selected maintenance, repair, overhaul and related services with
respect to Jazz’s CRJ regional jets. According to the ACTS-Jazz Agreement, ACTS serves as Jazz’s exclusive
repair agency to provide component repair and overhaul work on parts which can be removed from the aircraft
in respect of CRJ-100/200 and common CRJ-705 parts not performed internally by Jazz employees. The initial
term of the ACTS-Jazz Agreement expires in August 2015 and it is renewable for three successive two-year
periods. However, beginning in August 2008, either Jazz or ACTS may terminate the ACTS-Jazz Agreement
upon 180 days’ prior written notice.
Pursuant to the ACTS Master Services Agreement (“MSA”), Air Canada has agreed to provide ACTS with
services including infrastructure support and services which are mostly administrative in nature, including
information technology, human resources, finance and accounting, and legal services in return for fees to be
paid by ACTS to Air Canada. ACTS may elect to terminate any services under the ACTS MSA or the entire
ACTS MSA upon six months' prior written notice, with the exception of services relating to information
technology which ACTS cannot terminate prior to the expiry of the ACTS MSA. Air Canada may elect to
terminate any services under the ACTS MSA or the entire ACTS MSA upon 18 months' prior written
notice.
Pursuant to General Services Agreements between Air Canada and ACTS (the “ACTS GSAs”) Air Canada
provides ACTS with the services of a group of unionized and non-unionized employees for which is reimbursed
by ACTS for all costs, including salary and benefits, on a fully allocated basis. The ACTS GSAs may be
terminated by either party at any time and without cause upon a 30 days' prior written notice.
For a summary of significant related party agreements, refer to Note 18 to Air Canada's combined consolidated
financial statements.
47
Management's Discussion and Analysis of Results and Financial Condition