US Airways 2007 Annual Report Download - page 928

(i) "Item" means any of the Seller components, equipment, accessories or parts listed in Exhibit C that are installed on an Aircraft at any time during the
period of effectiveness of the Service Life Policy as defined below in Clause 12.2.2;
(ii) "Failure" means any breakage of, or defect in, an Item that
(a) materially impairs the utility or safety of the Item,
(b) did not result from any breakage or defect in any other Aircraft part or component or from any other extrinsic force, and
(c) has occurred or can reasonably be expected to occur, but does not necessarily occur, on a repetitive or fleetwide basis.
The Seller's obligations under this Clause 12.2 are referred to as the "Service Life Policy".
12.2.2 Periods and Seller's Undertaking
Subject to the general conditions and limitations set forth in Clause 12.2.4, the Seller agrees that if a Failure occurs in an Item within ** after the Delivery
of the Aircraft on which such Item is installed, the Seller will, at its discretion, as promptly as practicable and for a price that reflects the Seller's financial
participation as hereinafter provided:
(i) design and furnish to the Buyer a ** correction for such Item and provide any parts required for such correction (including Seller designed standard
parts but excluding industry standard parts), or
(ii) replace such Item.
12.2.3 Seller's Participation in the Cost
Any part or Item that the Seller is required to furnish to the Buyer under this Service Life Policy will be furnished at the Seller's current sales price
therefor, less the Seller's financial participation, which will be determined in accordance with the following formula:
P = C ( N — T ) / N
where
P: financial participation of the Seller,
** Confidential Treatment Requested.
USA — Amended and Restated Airbus A350 XWB Purchase Agreement PA — 50 of 109
EXECUTION PRIVILEGED AND CONFIDENTIAL