Frontier Airlines 2006 Annual Report Download - page 209

F. CONSEQUENCES OF TERMINATION
Any termination pursuant to one or more of the provisions of this Agreement will be without additional liability to the party
initiating such termination and will not be construed so as to relieve either party hereto of any debts or obligations, monetary or
otherwise, to the other party that accrued hereunder prior to the effective date of such termination. Each party will be entitled to any
and all damages recoverable and remedies under law or in equity against the other for any breach by the other party of this Agreement,
regardless of whether the non-breaching party elects to terminate this Agreement; provided that the liquidated damages provided for in
Article XVI.G shall constitute full payment and the exclusive remedy for any damages suffered by United in the event it terminates
this Agreement pursuant to the terms of this Article XVI sections A, B, C.2 or D.
G. LIQUIDATED DAMAGES
1. Except as otherwise provided hereunder, if United terminates this Agreement pursuant to the terms of this Article
XVI as a result of a Section A Default, a Section B Default, a Section C.2 default or a Section D default by Contractor, then
Contractor will be obligated to pay United liquidated damages. Such liquidated damages will be calculated in the manner
provided herein and shall not constitute a penalty.
2. If United is entitled to collect liquidated damages from Contractor as a result of Contractor’s material breach of
this Agreement, United’s liquidated damages shall be calculated as follows: lost contribution (which shall be conclusively
deemed to be [*] of United’s average monthly net revenue, defined as total Origination and Destination revenue minus taxes
and commissions, from Contractor’s United Express flights during the immediately preceding [*] period) multiplied by the
following percentages for each month in the following periods - (a) [*] for the first [*] following the termination of the
Agreement, (b) [*] for the next [*], and (b) [*] for the next [*]. Such amounts shall be subject to mitigation to the extent
United can replace Contractor’s United Express services.
3. The provisions of this Section XVI.G shall not apply to any termination as a result of a Section C.1 default, or a
Section E default.
H. RESTRICTED ACTIONS
Contractor shall not take, nor agree to take, any of the following actions without United’s prior written consent: (a) dispose of
any of United’s assets, or (b) enter into any agreements with third parties which create liens, claims or encumbrances on any of
United’s assets. To the extent that Contractor engages in, invests in or otherwise is responsible (financially or otherwise) for any
business, activity or operation other than Contractor’s United Express Services, and unless otherwise expressly agreed in writing with
United, Contractor will ensure that the costs and expenses associated with or allocable to such other businesses, activities or
operations are not charged to or recovered from United in any way.
I. CALL OPTION
1. United will have the option to assume Contractor’s ownership or leasehold interest, as the case may be, in certain aircraft as more
fully described in Article XVI.I. (the “Call Option”) in any one or more of the following circumstances:
a. If Contractor wrongfully terminates this Agreement, (in which event United will also be entitled to
Liquidated Damages to the extent provided in Article XVI.G); or
b. If United terminates this Agreement for Contractor’s breach of this Agreement for any one or more of
the following reasons (in which event United will also be entitled to Liquidated Damages to the extent provided in Article XVI.G)
i. Contractor’s operating performance falls below the following two levels for three consecutive months or any
6 month period within a rolling 12 month period:
(a).less than [*] controllable completion factor (excluding cancellations caused solely by weather, ATC,
United caused problems, and/or labor actions); and
Source: REPUBLIC AIRWAYS HOLDINGS INC, 10-K, March 15, 2007 Powered by Morningstar® Document Research℠