SOUTHWEST AIRLINES CO

11. SHAREHOLDER RIGHTS PLAN

On July 2, 2024, the Company's Board of Directors (the “Board”) adopted a shareholder rights plan and declared a dividend ofone right (a “Right”) in respect of each of the Company’s issued and outstanding shares of common stock, par value $1.00 per share (“Common Stock”), payable to the shareholders of record at the close of business on July 15, 2024. Each Right initially entitled the registered holder, subject to the terms of the Rights Agreement (as defined below), to purchase from the Company one ten-thousandth (a “Unit”) of a share of Common Stock, at a price equal to the quotient of $170.00 divided by ten thousand for each Unit of a share of Common Stock, subject to certain adjustments (as adjusted from time to time, the “Exercise Price”). The terms of the Rights were set forth in the Rights Agreement, dated as of July 2, 2024 (as it may have been amended from time to time, the “Rights Agreement”), by and between the Company and Equiniti Trust Company, LLC, as rights agent (or any successor rights agent, the “Rights Agent”).

The adoption of the Rights Agreement was intended to deter the acquisition of actual, de facto, or negative control of the Company by any person or group without appropriately compensating its Shareholders for that control. In general terms, the Rights Agreement imposed significant dilution upon any person or group (other than the Company or certain related persons) that was or became the beneficial owner of 12.5 percent (the “Triggering Percentage”) or more of the Company’s outstanding Common Stock without the prior approval of the Board. A person or group that became the beneficial owner of the Triggering Percentage or more was called an “Acquiring Person.” Any Rights held by an Acquiring Person would have become null and void and not exercisable. Shareholders that beneficially owned the Triggering Percentage or more of the Company’s outstanding Common Stock on the date the plan was adopted, were not considered Acquiring Persons; however, such Shareholders generally could not have acquired, or obtained the right to acquire, beneficial ownership of one or more additional shares of the Company’s outstanding Common Stock. The term “beneficial ownership” was defined in the Rights Agreement and included, among other things, certain securities that may have been exercised or converted into shares of Common Stock and certain derivative arrangements.

The Rights were set to expire prior to the earliest of (i) the close of business on July 1, 2025; (ii) the time at which the Rights were redeemed pursuant to the Rights Agreement; (iii) the time at which the Rights were exchanged pursuant to the Rights Agreement; and (iv) upon the occurrence of certain transactions.

This description of the Rights Agreement herein does not purport to be complete and is qualified in its entirety by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on July 3, 2024.

On October 23, 2024 (the “Cooperation Agreement Effective Date”), the Company entered into a Cooperation Agreement (“Cooperation Agreement”) by and among Elliott Investment Management L.P., a Delaware limited partnership, Elliott Associates, L.P., a Delaware limited partnership, Elliott International, L.P., a Cayman Islands limited partnership, and The Liverpool Limited Partnership, a Bermuda limited partnership. Pursuant to the Cooperation Agreement, the Company agreed to terminate the Rights Agreement no later than two business days after the Cooperation Agreement Effective Date.

On October 25, 2024, the Company and the Rights Agent entered into the Amendment to the Rights Agreement (the “Amendment to the Rights Agreement”), which amended the Rights Agreement. The Amendment to the Rights Agreement terminated the Rights Agreement by advancing the expiration time of the Rights to 5:00 P.M., New York City time, on October 25, 2024. At the time of the termination of the Rights Agreement, all of the Rights, which were previously distributed to holders of the Company’s Common Stock pursuant to the Rights Agreement, expired.