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10/6/2004 - STAFF REPORTS (10)
DATE: October 6, 2004 TO: City Council FROM: Director of Aviation NON-DISTURBANCE AGREEMENT BETWEEN THE CITY OF PALM SPRINGS AND PSP HANGARS ILLC RECOMMENDATION: That the City Council consent to a sublease agreement between Signature Flight Support Corporation and PSP Hangars I LLC and execute a non-disturbance agreement between the City of Palm Springs and PSP Hangars I LLC. SUMMARY Consent to a sublease and execute a non-disturbance agreement between the City of Palm Springs and PSP Hangars I LLC BACKGROUND: The City Council approved Agreement No. 4821 between Signature Flight Support Corporation and the City of Palm Springs at its January 21, 2004 meeting. Exhibit "F" to Agreement No. 4821 is the non-disturbance agreement attached. The non-disturbance allows the Subleasee (PSP Hangars I LLC) the ability to continue the lease in the event that the Lessor(City)were to terminate the lease with the Lessee (Signature). "Exhibit A" to the non-disturbance agreement is the ground sublease agreement between Signature Flight Support Corporation and PSP Hangars I LLC. The City Attorney has approved this agreement in its final form which is now being submitted for City Council consideration. RICHARD S. WAL'SH;A:A: . Director of Aviation APPROVED: =� City Manager Attachments: (1) Minute Order (1) Non-Disturbance Agreement REVIEWED BY©EPI OF MANE ��}ark NON-DISTURBANCE AGREEMENT THIS NON-DISTURBANCE AGREEMENT is made this f'—L day of Octob eerr gQO4 by and between THE CITY OF PALM SPRINGS, a California municipal corporation ("Authority') and ESP Hangars I LLc, a Signatu"e Fji ht Si nature Fli, htn Support Corporation,("Sublessee"). WHEREAS, Authority is the owner of certain real property located in Riverside County, California, which property is subject to a certain lease ("Prime Lease") dated Janus 21„ 2004 by and between the Authority as Lessor and SIGNATURE FLIGHT SUPPORT CORPORATION as Lessee; and WHEREAS, Sublessor and Sublessee are about to enter into a sublease of a part of the premises which are the subject matter of the Prime Lease(which sublease is attached hereto as Exhibit A and is herein after referred to as the "Sublease"); and WHEREAS, the parties hereto desire to assure Sublessee's possession of the premises which are the subject matter of the Sublease upon terms and conditions therein set forth irrespective of the termination of the Prime Lease, subject to the terms herein, NOW, THEREFORE, in consideration of the covenants hereinafter set forth and of Sublessee entering into the S ublease,the parties hereto do hereby agree as follows: 1. The Authority coisents to the execution and delivery of the Sublease in the form attached hereto as Exhibit A. 2, Provided the Sublease has not theretofore been terminated by Sublessor, in the event of the termination of the F'rime Lease before the expiration of the term of the Sublease, for any reason other than the defa0t of Sublessee, the Sublease shall continue as a lease between the Authority as Lessor and Sublessee as Lessee with the same force and effect as if the Authority as Lessor and S ublesuee as Lessee had entered into a I ease as of the date of the termination of the Prime Lease containing the same terms, covenants and conditions (including renewal options) as those contained in the Sublease for a term equal to the then unexpired term of the Sublease. This provision shall not apply and the Sublease s hall terminate as specified in the Prime Lease if the Prime Lease is terminated under Section 13 therein favi ation-related termination purposes]. 3. Notwithstanding tiny provision in this agreement, any provision of the Sublease shall be subordinate to any inconsistent provision in the Prime Lease and Sublessee shall not be entitled to any right or remedy against Authority,its officers, employees or agents for any refusal by Authority to comply w4h such inconsistent provision in the Sublease. 4 4, From and after ary such termination of the Prime Lease: a, Sublessee; will attorn to the Authority, and the Authority will accept such attornment, subject to the provisions of Sections 2 and 3 above; b, The Authority will have the same remedies for the breach of any agreement contained in the Sublease which Sublessor had or would have had if the Prime Lease had not been term inated; ixynis;i y.•1 1 5. Sublessee shall have the same remedies against the Authority for the breach of an agreement contained in the Sublease that Sublessee would have had against S ublessor if the Prime Lease had not been term inated. 6, No modifi0ation or amendment of the Prime Lease entered into by the parties thereto in substitution or replacement thereof shall be valid or binding as against the S ublessee without its prior written consen:thereto, which consent shall not be unreasonably withheld. 7. • Any notice or demand under the terms of this Agreement shall be in writing and shall be givers or made by mailing to the same by registered or certified mail addressed to the respective parties at the addresses set forth opposite their signature below. 8. No modification,amendment, waiver or release of any provision of this agreement shall be valid for any purpose unless in writing and duly executed by the party against whom the same is thought to be asserted, 6. This agreement shall be binding upon and shal I inure to the benef it of the parties hereto and their respective hei is, legal representatives, successors, assigns and sublessees and shall be governed by the lews of the State of California. i 4 IRV NI 5925 vt -2- , IN WITNESS WNI RLVF,tho pmtIor,hale exeeutod and entered Into thlu Agreement as of Tile date first wriha n above. CM OF PALM SPRINGS ATTUT: a tnunicipal corporation \ 4 City Clerk Clty Manager APPROVED A' Gily Attorney - CONTRACTOR: Chock one:_IndividuEd_Partnership„Corporation Carporallwi5 require two notarized 510nalure6; Ono Imm caoh of the following: A. Chdfnnan of Cioard, Prnsldsnl, or mny vrr•. Pmmidont:AND 13,Saewtary,Asdlslant Secrebary,'fromurvc,A&6islant Treasurer,or Chiuf Financial ofOcep. Y:._m.. Signaturn(nUltufaeo) Signatum(noledzed) Name:-- ........,, ,......--...._.,,. Namrl--- THW__...,.,.. .........�.......�..._—._,.._ Tillnl._.,..,, State G1 f State of County GI fss County of On _,before Persgnolly appeared personally appeamd personally known to personally known lla3(or proved to me oil ltie basis of salisf➢ctory ovldonoe)to to rho(or proved to me on the basis of nallafaciety evidence) bo,the peYdao(s)wtaase nante(s)finlare suascdbad to the to be rho psmon(6)Whorig name(s)islare subscribed to Hie within instrument and acknowledged to me that he/uhollhey within instrument and acknowledged to rnn that holshe/Ihoy bxecUted lha some in hif/hoiltheir authorized cwapaclly(ies), executed the name In hi.;Rtetlihoir uulhodznd capaelly(ios), and that by hluther/thelr slgnahlre(s)on lha Inotrunlenl the and that by hNithorryhair slrgrialurd(s)on(ho Instrument the p(,Mon(s),or the entity upon beholf of Which the pehlGn(s) person(s),or the anllly upon behalf of whi6h the pomon(s) acted,exoauled ilia Instrument. anted,exoixrted ilia instrument. WITNLSS my hand and official seal, WITNESS rny,tWilild and offic(al deal. 4 NoWrY Notary Seal: Notary Seal: IRV Y1:02i vl „3- GROUND SUBLEASE AGREEMENT by and between SIGNATURE FLIGHT SUPPORT CORPORATION and PSP HANGARS I LLC. covering real property located at Palm Springs Regional Airport 3400 East Tahquitz Canyon Way Palm Springs, California 92262 F� GROUND SUBLEASE AGREEMENT THIS GROUND SUBLEASE AGREEMENT (hereinafter, "Sublease") is entered into as of herein (hereinafter, the "Contract Date") by and between SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation with its principal offices located at 201 South Orange Avenue, Suite 1100, Orlando, Florida 32801 (collectively "Signature") and PSP HANGARS I LLC, a Colorado limited liability company, with its principal offices located at 2939 Ohio Way, Denver, Colorado ("Sublessee"). For purposes of this Sublease, Signature and Sublessee, from time to time, shall hereinafter be referred to individually and generically .as a "Party" and collectively hereinafter as the "Parties." RECITALS WHEREAS, the City of Palm Springs ("Authority") entered into Agreement No. 684 with Gates Aviation Corporation dated October 1, 1969, and assigned to Signature May 3, 2002, and Authority entered into Agreement No 3842 with AMR Combs, Inc. dated December 13, 1996, and assigned to Signature May 3, 2002 which leased certain real property to Signature; and WHEREAS, the Authority and Signature have negotiated new terms, consolidating the existing lease terms into that certain Lease with Signature Flight Support Corporation For Fixed Base Operator (FBO) Services at the Palm Springs International Airport ("Master Lease"), said lease agreement being incorporated herein and to be attached hereto upon its execution by all parties as Exhibit A for the purpose of operating a fixed base operation at Palm Springs International Airport in Palm Springs, California ("Airport"); and WHEREAS, consistent with the terms and conditions set forth herein, Sublessee is desirous of constructing a condominium regime of private hangars ("Hangar Facility") on Parcel 3 and Parcel 6 (0.95 acres and 1.60 acres, respectively) ("Leased Premises"), partially-improved land situated at the Airport and a portion of Signature's leasehold as described in the Master Lease and as depicted and described in Composite Exhibit B attached hereto and incorporated herein, and WHEREAS, Signature is desirous of furnishing the necessary partially-improved land from its existing Airport leasehold for the Sublessee.to design and construct thereon the Hangar Facility at Sublessee's sole cost and expense which Hangar Facility shall be e subleased or otherwise transferred by Sublessee to an Association of Condominium Owners ("Association") to be used to hangar and store aircraft operated but excluding Aircraft(as defined in paragraph 2 of this Sublea ) aintenance using Regulated Substances (as defined in paragraph 14 of this Subl e ("Approved Uses") by the Condominium Owners; and NOW, THEREFORE, in.consideration of the mutual covenants nd greements hereinafter contained, the Parties hereby agree as follows: 1. Due Diligence. Sublessee shall have a period of ninety (90) days from the Contract Date to perform its due diligence (the "Due Diligence Period"). During the 1 CADocuments and Settings\jbrewer1ocal SettingsWempTSP Hangars LLC revised final 062804.doc cr I1 Due Diligence period, Sublessee, or. its agents, may inspect the proposed Leased Premises as hereinafter defined and make surveys and with the prior written consent of Signature and the Authority) make test borings, plus conduct legal, financial and environmental due diligence, including seeking consent from the Authority to a non- disturbance agreement in the form attached hereto as Exhibit C -1. No invasive tests, soil or environmental assessments may be conducted without the express prior written consent of Signature. Copies of all surveys, test results, or environmental assessments shall be provided to Signature. In the event that the results of Sublessee's due diligence are unacceptable to Sublessee, in its sole determination, Sublessee may terminate this Sublease upon written notice to Signature. If Sublessee fails to provide such written notice prior to the end of the Due Diligence Period, it shall be conclusively presumed to have waived its right to terminate this Sublease. The "Effective Date" of the Sublease shall be the last day of the Due Diligence Period. In addition, if Sublessee fails to obtain approval of its development plans from the Airport Authority and the City of Palm Springs by September 30, 2004, Sublessee may terminate this Sublease upon written notice to Signature pursuant to paragraph 19, which notice must be received by Signature on or before November 1, 2004. Signature agrees to provide Sublessee copies of any soil investigation report, survey, title report, environmental assessment and/or engineering studies in its possession, pertaining to the Leased Premises as hereinafter defined. Provided Sublessee has not terminated this Sublease as provided herein, Sublessee shall within two (2) business days following expiration of the Due Diligence period make an initial security deposit to Signature of $2,500.00. Any security deposit received by Signature is not required to be maintained in any escrow account and may be treated as general revenue by Signature. 2. Conveyance of Rights. Upon the Effective Date of this Sublease and conditioned upon execution of the Master Lease, Signature does hereby lease, convey and deliver to Sublessee exclusive possession of the Leased Premises and the improvements located thereon, as well as, the exclusive right to design and construct the Hangar Facility for the subsequent exclusive use, operation, maintenance and administration by Sublessee or any of its Sub-sublessee Condominium Owners for the Approved Uses (as defined above in Recitals)for Aircraft owned or leased and operated ("Aircraft"). So long as Sublessee performs its obligations in this Sublease, Sublessee's possession of the Leased Premises will not be disturbed by Signature, its successors and assigns, a. Proposed Date of Beneficial Occupancy. Sublessee shall utilize commercially reasonable and diligent efforts to construct the Hangar Facility in one phase of sixteen (16) units for final completion from including, but not limited to, Sublessor and all authorities having jurisdiction over construction or before August 1, 2005. The Parties agree that the allotment of twelve (12) months for Sublessee to design and complete construction of the Hangar Facility from the Effective Date is a fair and reasonable time frame, consistent with the proposed scope of,design of the Hangar Facility. If Sublessee is unable to obtain a Temporary Certificate of Occupancy for the Hangar Facility within twelve (12) months, or on or before November 1, 2005, then Signature shall have the right to take over the project and complete upon five (5) days 2 CADocuments and SettingsVbrewerlLocal SettingslTempTSP Hangars LLC revised flnal 062804.doc 44KK 7 written notice to lender. Upon completion thereafter, Signature agrees to pay Sublessee the unamortized value of the project less any costs to complete which exceed the original project commitments. Subsequent to the Effective Date and to the extent completion of construction hereunder can be reasonably estimated, the anticipated Date of Beneficial Occupancy by Sublessee shall be determined and memorialized between 1 the Parties in writing and incorporated within this Sublease as an amendment. If Sublessee occupies the Leased Premises for the storage of Aircraft prior to nine (9) months after the Effective Date, it is mutually agreed the Date of Beneficial Occupancy o$sgnicferd' shall be the date Sublessee first occupies fhe Leased Premises. Neither Sigliature nor on the Authority shall be liable to Sublessee for any damages incurred as a r s I of delays in construction. b Construction i) Utility Facilities - All utility connections and facilities shall be provided and installed in accordance with Sublessee's Concept and Scope Schedule, Exhibit "F" attached hereto, at Sublessee's and/or the Authority's cost.and expense and without expense to Signature. ii) Cost of Construction and Development Fees - The Parties expressly agree and understand that the design and construction of the Improvements shall be undertaken and completed materially and substantially in accordance with Sublessee's approved drawings and specifications and solely at Sublessee's cost and expense. All design and construction costs including, but not limited to, drawings including as-builts; specifications; permits and approvals; insurance and bonds; financing and administration; construction labor, materials, and services; utilities and site work; and any equipment or other fixture installation, maintenance, alterations, repairs, replacement, use and removal on the Leased Premises shall be at Sublessee's sole cost, expense and liability throughout the Lease Term. Upon Sublessee's completing the Improvements, Sublessee shall provide to Signature a certified statement of any and all fixed improvement costs. Such statement shall include but not be limited to costs as set forth in this subparagraph. Further, Sublessee shall provide Signature and the Authority copies of complete as-built drawings, at Sublessee's sole cost and expense. As additional improvements, if any, are added by Sublessee from time to time during the Term, as the same may be extended, the requirements of this section shall be applicable to such additional improvements. Signature shall not have, any liability or responsibility for the payment of development fees, impact fees or other similar. fees or charges pertaining to or arising out of the development, improvements, construction, and occupation of the Hangar. Sublessee shall pay all such fees or otherwise cause payment by the proper party responsible for payment. iii) Payment of Liens - Sublessee shall require its general contractor to pay its subcontractors and indemnify Sublessee and Signature from any and all liens for unpaid labor, material, and services which arise under the construction agreements. IV) Insurance during Construction Phase - Prior to commencing construction, Sublessee shall ensure that its general contractor obtain: 3 CdDocuments and SattingsljbrewerlLocal SettingslTempTSP Hangars LLC revised final 062804.doc a) Builder's Risk insurance for the full replacement value of the project; b) Worker's Compensation at statutory limits required under California law; c) Employer's Liability per occurrence with policy limits of$1,000,000.00; d) Commercial General Liability written on an occurrence basis and with a combined single limit in the amount of $1,000,000.00 including Contractual Liability, Products Liability and Completed Operations; e) Automobile Liability. Signature and the Authority shall be named as additional insureds on all policies and shall provide copies of such additional insured endorsements. Sublessee's general contractor and Major Subcontractors shall be required to provide Signature with certificates of insurance which evidence the coverages required by Paragraph 14. Sublessee and Sublessee's general contractor and Major Subcontractors shall also comply with all insurance requirements set forth in the Master Lease. (For purposes hereof, "Major Subcontractors" means those subcontractors whose subcontracts exceed Fifty Thousand ($50,000.00) Dollars. v) Approval of Plans and Specifications - Prior to the commencement of any construction by Sublessee, Signature and if required by the Master Lease the Authority shall have the right to approve all design and architectural plans, drawings and specifications for the Leased Premises and any Additional Improvements which are estimated to exceed Seventy-Five Thousand Dollars ($75,000.00) from time to time during the Term hereof, as same may be extended, and no material modification, change, or addition shall be made to any such plans and specifications nor any material alteration of any then-existing improvements shall be made, without the prior approval of Signature and the Authority. Such approval rights of the Authority shall be in accordance with the terms of the Master Lease, but as to Signature, such approval rights shall be in.Signature's reasonable discretion. Signature agrees to review and comment promptly. Sublessee agrees to provide Signature with specific deadlines for approval. In this regard, both parties acknowledge that time is of the essence. vi) Compliance with Codes and Regulations - Sublessee and its contractors shall comply with all building codes, standards, laws, regulations, and ordinances for the initial design and construction of the Improvements and the construction from time to time of any Additional Improvements made by Sublessee, standards, criteria, laws, regulations and ordinances established by the Authority and any and all other local, state and federal agencies having jurisdiction over the design and construction of the Improvements, including without limitation, storm water, sanitary sewer and environmental requirements. Further, Sublessee and its contractor shall comply with Authority's Design Manuals then in effect. In addition, to the extent applicable, Sublessee shall comply with all applicable codes and regulations as set forth in the Master Lease. 4 CADocuments and setfingsllbrewer\Local Settings7empTSP Hangars LLC revised final 062804.doc _ I vii) Construction Impact on Signature - Sublessee, its general contractor, subcontractors, employees and agents shall take all appropriate .commercially reasonable action to minimize interFerence with Signature's business operations during the construction of the Improvements, if any, undertaken by Sublessee. In furtherance of the foregoing, Sublessee, its general contractor and subcontractors and Signature shall, throughout the period of construction meet upon reasonable advance notice in order to, in good faith, coordinate all construction activities which might affect Signature or its operations. Sublessee covenants, for itself, and shall require its general contractor and subcontractors to act diligently (a) avoid interrupting utility service to Signature's Premises, and (b) provide Signature's local General Manager with at least 24 hours' written notice (except where 24 hours' prior notice is impracticable) if any utility service will be interrupted to Signature's Premises. In the event interruption to utility service to Signature's Premises is unavoidable, such interruption shall be scheduled for non-peak hours, as required by Signature. Sublessee shall designate an individual who shall serve as a single point of contact for communicating and coordinating all construction related issues with Signature. Sublessee shall also provide Signature with monthly construction updates and Sublessee shall also coordinate all construction activities with .Signature and the Authority. viii) Construction Liens - If any claims, liens or encumbrances are filed against the Leased Premises or any part of the Hangar or the Premises, Sublessee shall, within thirty (30) days after notice of the filing thereof, cause the same to be discharged of record by payment, deposit, bond, order of a court of competent jurisdiction or otherwise. Notwithstanding the foregoing, however, Sublessee shall have the right to, in good faith, contest any lien by appropriate legal proceedings so long as such contest does not subject Sublessee, any of Sublessee's lenders, Signature, the Authority, the Hangar or the Leased Premises to the imposition of any encumbrance, penalty, fine, charge, interest, cost or the like, or to civil or criminal prosecution, or cause the Hangar or any portion of the Leased Premises to be subject to foreclosure by any of Sublessee's lenders; provided, further, however, that, upon the termination of any such legal proceedings, Sublessee shall immediately cause any claim, lien or encumbrance to be discharged of record. Sublessee shall conduct its own site investigation, at its own expense, which may include, but not be limited to, any wetlands testing and environmental assessments, studies, reports, and remediation required in connection with the construction of the Improvements, and any additional Improvements. Copies of such reports shall be provided to Signature. Sublessee shall design the Improvements consistent with the Concept Scope and Schedule as set forth on Exhibit T." ix) Change in Airport Operations - If the Authority or the federal government ceases, limits, or modifies operations of the Airport prior to the completion of construction of the Improvements, the Authority shall have the right to request modifications to the Improvements, which modifications Signature shall be afforded the reasonable right to review and approve. In the event of an Airport shutdown or a modification to Airport operations, which would jeopardize the feasibility of or need for the Improvements, the Authority shall have the right to order Sublessee to cease construction. In any such event, the condemnation provisions contained in the Master 5 n CADocuments and Settings\Ibrewer\Local Settings\Temp\PSP Hangars LLC revised final 062604.doc 1` fim Lease shall apply. Signature shall not be liable to Sublessee for any loss of business or revenues sustained by Sublessee as a result of any change in the operation or configuration of the Airport or any change in any procedure governing the use of the aeronautical areas of the Airport, including a complete shutdown of the Airport for security or any other reason but Sublessee shall be entitled to a portion of the award allocable to the Leasehold Improvements less prorate costs incurred in pursuing such award. x) Tie-in with Signature's Premises - Sublessee shall promptly coordinate with the Authority and Signature regarding all design and construction activities including, without limitation connections to utility construction, construction activities, interruption concerns, capacity issues, and traffic issues and tie ins to the existing Signature ramp, taxiways and utilities. This provision shall apply to any and all tie-ins with Signature's Premises. A) Letter of Credit — Prior to commencing construction Sublessee shall provide written confirmation to Sublessor certified by the financial institution funding the Hangar Facility improvements. Such confirmation shall certify that (1) sufficient funds are on hand exclusively for the Hangar Facility improvements and any reasonable contingencies (up to 5% of actual hard costs) which could be encountered during the construction including but not .limited to construction liens and construction lien expenses; (2) financing shall not exceed seventy-five percent (75%) of the total completed value of the Hangar Facility and associated Improvements. Prior to commencement of any construction of approved facilities or any phase thereof, Tenant shall furnish to City evidence that assures City that sufficient monies will be available to complete the proposed construction. The amount of money available shall be at least equal to the total estimated construction costs or such lesser amount as is accepted by the City. Such evidence may take one of the following forms: i) Completion Bond issued to City, as obligee; ii) Irrevocable letter of credit issued to City from a financial institution to be in effect until City acknowledges satisfactory completion of construction iii) Cash; IV) Any combination of the above. v) Or any other evidence as is agreed upon by Sublessee and City. b. Survey of Leased Premises - Sublessee, at its sole cost and expense, shall obtain within One Hundred Twenty (120) days from the Effective Date a boundary survey of the Leased Premises (the "Survey"). The Survey shall be certified to the Sublessee, Signature, the Authority and Sublessee's Lender and Title Company. The Survey shall: i) Comply with all ALTA requirements and be in sufficient form to satisfy the reasonable requirements of Signature. 6 CADocuments and Settings\Jbrewer\Local Settings\Temp\PSP Hangars LLC revised final 062604.doc I ii) ' Be prepared in accordance with the minimum technical standards (including Surveyor's Certification) required in the jurisdiction. iii) Set forth an accurate metes and bounds description of the Leased Premises, the gross number of acres contained in the Leased Premises, and the number of acres of land contained in the Leased Premises. iv) Locate all existing easements and rights of way, whether recorded or visible (setting forth the book and page number of the recorded instruments creating the easement). v) Show any encroachments onto the Leased Premises from adjoining property and any encroachments onto the adjoining property. vi) Show all existing improvements (such as buildings, power lines, fences, roads, driveways, railroads, underground utilities) and all rivers, creeks drainage ditches or other water courses. vii) Show all roads providing access to the Leased Premises. viii) Identify any flood zones as defined on Federal Flood Insurance rate Maps (F.I.R.M.)for the applicable jurisdiction of the Leased Premises. Upon completion of the Survey, it shall be attached to this Sublease as Exhibit B-1. 3. Term. The term of this Sublease shall be co-terminus with the remaining term under the Master Lease ("Term"). Term shall commence on the Effective Date and shall continue through May 31, 2044. a. In the event the Authority renews the Master Lease with Signature, Signature hereby agrees to extend the Term of this Sublease for an additional period of time to be subsequently negotiated upon terms and conditions substantially the same as set forth herein; provided, however, the Base Rent (as subsequently defined herein) and method of annual escalation shall be increased to reflect the then current market rate of a similar facility in this geographic market. b. In the event the Master Lease is not extended, renewed or otherwise continued after the end of the Term or a replacement lease and operating agreement is for any reason not tendered and/or successfully negotiated or Signature desires not to continue in its existing capacity as a fixed base operator at the Airport, Signature shall use its best efforts to assist Sublessee to negotiate a Non-Disturbance Agreement between the Airport and Sublessee. However, if no such Non-Disturbance Agreement has been executed, then this Sublease shall terminate as of midnight local time on the last day of the term of the Master Lease. Sublessee shall thereupon look solely thereafter to the Authority or Signature's successor-in-interest for any and all performance, relief or continuance hereunder, as subsequently determined by the Authority. 7 CADocuments and Settings\)brewer\Local Settings\Temp\PSP Hangars LLC revised final 062804.doc 614 lolm� 4. Non competition by Sublessee. This Leased Premises may only be used for storing Aircraft ("Aircraft"). Sublessee shall not permit the Leased Premises to be used for the operation of any business substantially the same as the business operated by Signature at the Airport or any other service for which Signature is authorized and/or permitted to conduct pursuant to the collective provisions of the Master Lease, which restrictions shall be memorialized in recordable form as set forth in Article 38 herein. Sublessee expressly warrants and represents that it shall not, at any time during the Term or any renewal thereafter, undertake in its own behalf, or cause to be undertaken through any third party, including, without limitation, Sublessee's employees, contractors, subcontractors, subtenants, agents and invitees, the following services from the Leased Premises: a. the installation of any fuel storage and dispensing facilities (including mobile delivery of fuel); b. the receipt and storage of any fuel product, including, but not limited to, aviation and motor fuels; c. the into-plane or into-truck delivery of any aviation or motor fuels; d. aircraft sales or rentals; e. aircraft charter service and flight training; f. aircraft radio and instrument sales and service; g. any specialized aircraft repair service (excepting the Aircraft defined herein); h. air transport of mail or cargo for hire; i. retail or wholesale distribution of goods; and j. hangaring of any aircraft or rotorcraft, other than the Aircraft defined herein. k. any other activity determined by Airport to be disruptive or to be inconsistent with permitted to Signature under the Master Lease. 5. Third Party Aircraft Maintenance, Sublessees (including Condominium Owners) may not perform any Aircraft maintenance or repair for its own Aircraft contrary to the Approved Uses until it has provided Signature with Environmental/Pollution Liability coverage at limits required by this Sublease, or equivalent coverage satisfactory to Signature. Alternatively, Sublessees or Condominium Owners may have the Original Equipment Manufacturer ("OEM") or other vendor enter onto the Signature Leasehold Premises only after it has: a. Executed the Vendor Release, a copy of which is attached as Exhibit"D"; 8 C:1Documents and Settings\jbrewerlLocal Settings\Temp\PSP Hangars LLC revised final 062804.doc z ' b. Provided a Certificate of Insurance for the requisite insurance coverage at Exhibit D/Attachment D and; G. Signature has authorized its entry in writing. Sublessee shall bear any and all costs associated with ensuring such supplemental personnel or third party providers fully comply with any and all prevailing Airport regulations, including but not limited to security and identification. 6. Subordination and Incorporation of Master Lease. This Sublease is at all times predicated upon Signature's continuing authority and/or discretion to operate at the Airport and shall at all times be subject to the terms and conditions of the Master Lease as set forth in Exhibit A. All of the terms, provisions, covenants and conditions contained in the Master Lease (as well as, any and all amendments and addendums to the Master Lease promulgated by the Authority or otherwise mutually agreed to between Signature and the Authority, subsequent to the execution of this Sublease) are hereby made a part of this Sublease, except as herein otherwise expressly provided. Sublessor will not default in its obligations under the Master Lease or amend or modify the Master Lease in any material manner which adversely affects Sublessee's rights under this Sublease. Sublessee shall not violate any of the terms of the Master Lease and shall comply with such terms as applicable to a subtenant. In the event of any Conflict or inconsistency between the terms and conditions of this Sublease and those of the Master Lease, this Sublease shall prevail. This Sublease shall not be subordinated to any lien, encumbrance, mortgage or other evidence of Sublessee indebtedness and shall at all times take priority over such lien, encumbrance, mortgage, or other evidence of Sublessee indebtedness. 7. Title and Ownership of Hangar Facliity. During the Term, title and ownership of the Hangar Facility shall be vested solely with the Sublessee or the Association as successor to Sublessee's rights under this Sublease. Sublessee shall possess the exclusive right to utilize and operate the Hangar Facility during the Term. Concurrently with, and as a prerequisite to, the sale of any condominium unit to a Condominium Owner, Sublessee and such Condominium Owner shall enter into a "Hangar Sublease"*covering the unit purchased by the Condominium Owner and the condominium common areas and a Consent, Non-Disturbance, and Attornment Agreement in the form of Exhibit C-2, which Signature agrees to execute with Condominium Owner. Concurrent with the termination of this Sublease resulting from Term expiration or Sublessee default hereunder, the Hangar Facility and all other improvements constructed upon the Leased Premises shall remain at the termination of this Sublease with all rights, title, and ownership subsequently transferred to and assumed by Signature or, consistent with the provisions of Article 8, by the Authority, but subject to the provisions of any Hangar Sublease and Consent. Upon the assignment of this Sublease to the Association pursuant to this Section, Sublessee shall be released from all obligations hereunder except as otherwise set forth in this Sublease for obligations existing as of the Assignment date. Signature shall be entitled to enforce any duties or obligations of Sublessee against any Condominium Owner or other sub- sublessee or transferee. 8. Termination of Master Lease by Authority. In the event the Master Lease shall be terminated because of a taking or sale under or because of the right to 9 CADocuments and Settings\jbrewer\Local SeflingsWemp\PSP Hangars LLC revised final 062604.doc /y� eminent domain as provided for in Article 14 of the Master Lease, Signature agrees Sublessee shall share in any award or settlement received, as well as share in any prorata costs incurred in such recovery by Signature for the Hangar Facility or any other improvements made to the Leased Premises, if any and only, to the extent that any such award is attributable to the Subleased Premises and the Hangar Facility or other improvements constructed by Sublessee. Upon expiration or early termination of this Sublease, Sublessee and any Condominium Owner(as such may be permitted) shall have the right to remove all of its fixtures, equipment personal property and other property from the Hangar Facility deemed to be removable and/or non-improvement alterations, provided, except for termination because of a taking or sale under right of eminent domain. Sublessee shall repair any damage to the Hangar Facility as a result of such removal. Conditioned upon receiving the prior written approval of the Authority, Signature reserves the right to sell, assign, or otherwise transfer all or part of its leasehold interests and/or operating rights at the Airport, including, but not limited to, that portion of the leasehold which encompasses the Leased Premises subject to the rights of Sublessee hereunder. 9. Rent. a. Base Rent. For its use and occupancy of the Leased Premises during the Term, Sublessee agrees to pay to Signature, on the first day of each month, payable in advance, without set-off, demand or deduction, except as provided herein, the rental fee(s) as outlined below, exclusive of all applicable and then prevailing Authority imposed concession fees and State and Federal taxes ('Base Rent'). Payment of Base Rent shall commence on the "Date of Beneficial Occupancy" and shall be calculated at a rate of $0.35 per square foot per year based on the floor area of the building footprint plus ten (10) linear feet of ramp space directly adjacent to the east and west side of each building. $0.35 per square foot, per annum, i.e. $ per annum The parties agree that the Final Survey Certified to Signature shall constitute the accurate square footage for purposes of assessing rent. This assessment shall be calculated using the Per Square Footage Per Annum ("PSFPA") cost, as it relates to the square footage of the Improvements. b. Annual CPIU Adjustment. Commencing on the first anniversary of the Effective Date of this Sublease and continuing on the same day of every year of the Term thereafter, the Base Rent shall be adjusted to account for cost of living changes. The Consumer Price Index Urban shall be the same percentage of increase for all urban consumers unadjusted using the reference base 1982-1984 = 100 (hereinafter the "CPIU") published by the Bureau of Labor Statistics of the U.S. Department of Labor. The Base Rent shall be adjusted each twelve (12) months by the percentage change in the CPIU for Palm Springs, California (or, if none, for the closest metropolitan area, which has a CPIU, during such twelve (12) months. in the event the foregoing CPIU is 10 CADocuments and settings\Jbrewer\Local SettingsWemp\PSP Hangars LLC revised final 062804.doc tl for any .reason not available, it is mutually agreed the CPIU as compiled for, and identified as the "U.S. Authority Average" shall be utilized in replacement thereof. The Parties agree to utilize the foregoing CPIU for the month prior to the first adjustment date thereafter, and the same month annually thereafter, recognizing that the Bureau of Labor statistics of the U.S. Department of Labor may not have the CPIU data available for release until several months after the fact. Should the U.S. Department of Labor, Bureau of Labor Statistics, abolish, modify or otherwise replace the CPIU with an equivalent index, the Parties agree to substitute the new index for the CPIU. Further, if the base 1982-1984 = 100 is changed by the U.S. Department of Labor, the Parties agree to apply the new base to their adjustments for convenience in doing the adjustments. In no event shall the Base Rent be adjusted downward during the Term. c. Supplemental Rent. All additional sums in addition to the Base rent due and owing to Signature as a result of Sublessee's use and/or occupancy of the Hangar Facility and or Leased Premises, shall hereinafter be collectively referred to as "Supplemental Rent" and shall be remitted in full by Sublessee in accordance with the provisions of Sub-Paragraph (h)of this Article. d. Alteration of Prevailing Land Rents by Authority. Notwithstanding any other provision in this Sublease to the contrary, in the event at any time during the Term, any renewal option exercised thereafter, or the month to month continuance of same, the Authority or any other Local, State or Federal agency having jurisdiction over the Airport and Signature's leasehold interest in the Hangar Facility promulgates or otherwise enacts rules, regulations or laws which result in the prevailing land rents and/or concession fees applicable to Signature's leasehold interest in the Leased Premises to be increased, then Signature reserves the right to increase Sublessee's then prevailing monthly Base Rent by the corresponding and proportionate amount applicable to land rent e. Utilities. Sublessee shall independently and separately meter electrical power to the Hangar Facility directly from the public utility provider. All charges incidental to the providing of the foregoing utilities shall be the sole and direct responsibility of Sublessee. In the event any other increase or change in utilities are required for Sublessee's use of the Leased Premises, such requirements shall be the sole responsibility of Sublessee including, but not limited to, improvements, alterations, installation, maintenance and repairs (including, but not limited to, underground repairs of pipes and conduits) and payments for utilities consumed and required removal thereof. f. Taxes. Sublessee shall be responsible for the payment of any and all applicable taxes or assessments against the Leased Premises, including, but not limited to, all real estate, ad valorem and possessory interest taxes and assessments. If the Leased Premises are part of a larger tax parcel, taxes will be apportioned based upon land area. Taxes will be prorated during the first and last year of the Lease Term. Signature will use reasonable efforts to have the Leased Premises separately assessed. Sublessee agrees to pay all such taxes and assessments which are assessed against Signature with respect to personal property and improvements constructed or maintained by Sublessee on or about the Leased Premises. 11 C1Documents and settings\jbrewer\Local Setlings\TernpTSP Hangars LLC revised final 062804.doc ^y' 1 g. Triple Net Lease. This Sublease shall be without cost to Signature during the Term hereof, or any continuance or execution of a replacement lease or operating agreement entered into between Signature and the Authority. It is the intent of the Parties that this Sublease be interpreted and enforced as a triple net lease to Signature and Sublessee shall pay all costs and expenses associated with the design, construction, operation and maintenance of the Hangar Facility, except as otherwise expressly set forth herein. h. Aggregate Rent. For purposes of this Sublease, Base Rent and Supplemental Rent shall collectively hereinafter be referred to as "Aggregate Rent." In the event any monthly Aggregate Rent is not paid by Sublessee with ten (10) calendar days from the due date, Signature reserves the right to impose a late payment fee of one and one-half percent (1.5%) per month of the outstanding balance which shall be added to the amount due and owing to Signature. The assessment of late charges or the payment of same by Sublessee shall not in any manner prejudice or diminish the rights of Signature as set forth in Article 20 of this Sublease. i. Pro-Rata Rent Payments. Aggregate Rent payments made by Sublessee hereunder shall be prorated for any partial months during the Term hereof. 10. Maintenance of Hangar Facility. All improvements undertaken subsequent to the Date of Beneficial Occupancy, as well as, all maintenance, alterations, repairs, replacement, use and removal of the Leased Premises shall be at Sublessee's sole cost, expense and liability. Such maintenance shall include, but In no way be limited to, landscaping, lawn care, pavement repair and rehabilitation, trash removal, painting, cleaning, glass replacement, light, water, heat and air conditioning systems (including underground piping and conduits) and hangar door and structural repairs. The Hangar Facility and all other improvements so constructed upon the Leased Premises by Sublessee shall remain thereupon at the termination of this Sublease with all rights, title and ownership thereupon transferred to and assumed by Signature, its successor-in-interest, or the Authority. 11. Non-Exclusive Easements. Signature grants to Sublessee non-exclusive easements during the term hereof and any extensions or renewals thereof sufficient at all times to move the Aircraft to and from the Leased Premises to designated Airport taxiways and, in addition, to provide continuous ingress and egress to and from the Leased Premises for vehicles, including, all vehicles and other equipment required by contractors, subcontractors and subtenants of Sublessee, provided all such vehicles and vehicle operators are at all times in full compliance with then prevailing Authority rules and regulations regarding Airport and specifically, Aircraft Operations Area (AOA) access, and provided further, subject to any maintenance or repair activity of Signature or the Authority. Signature shall maintain such access ways in a good state of repair as shown on Composite Exhibit B at its sole cost and expense. Sublessee shall at all times remain fully liable for the acts or omissions of all vehicles which it operates or which are operated by its contractors, subcontractors, subtenants or any other party having Sublessee's permission to be on the AOA at the Airport and, without limitation, Signature's Airport leasehold. 12 CADocuments and settingsljbrewer\Local Settings\Temp\PSP Hangars LLC revised final 082804.doc A 7 Sublessee is authorized to utilize Signature's general aviation vehicle parking lot for its employees, guests, subtenants and clients on a non-exclusive, as-available basis at no cost or expense to Sublessee. Sublessee acknowledges Signature's general aviation terminal parking lot is situated outside the Airport perimeter fence and as such, is located in a non-segregated, public-accessible environment not subject to surveillance and monitoring by Signature or the Authority. Under no circumstances shall Signature or the Authority be liable to Sublessee or any third party or individual claiming through Sublessee (including, but not.limited to, Sublessee's employees, guests, subtenants and clients) for loss, theft or damage to any vehicle (or any vehicle contents) situated within the confines of Signature's general aviation terminal parking area unless caused by the gross negligence or willful misconduct of Signature. 12. General Indemnification. Subject to the provisions of Article 14 or herein, Sublessee agrees to indemnify, defend and forever hold harmless Signature, the Authority and their respective officers, directors, employees, agents, servants, contractors, subcontractors insured's and invitees from and against any and all claims, liabilities, losses, demands, fines, penalties, actions, judgments or other expenses (including, but not limited to, defense costs and reasonable attorneys' fees) imposed upon Signature and/or the Authority by reason of injuries or deaths of persons (including wrongful death) and damages to property, arising from Sublessee's use and occupancy of the Leased Premises or uses of Signature's leasehold or any acts or omissions of Sublessee or its officers, directors, employees, agents, contractors, subcontractors, subtenants, invitees or other representatives. Subject to the provisions of Article 14 herein, Signature agrees to indemnify, defend and forever hold harmless Sublessee, the Authority and their respective officers, directors, employees, agents, servants, contractors, subcontractors and invitees from and against any and all claims, liabilities, losses, demands, fines, penalties, actions, judgments or other expenses (including, but not limited to, defense costs and reasonable attorneys' fees) imposed upon Sublessee and/or the Authority by reason of injuries or deaths of persons (including wrongful death) and damages to property, arising from the gross negligence or willful misconduct of Signature or its officers, directors, employees, agents, contractors, subcontractors, subtenants, invitees or other representatives. The foregoing indemnifications shall survive the termination of this Sublease. 13, Security. Sublessee shall observe all security requirements of Federal Aviation Regulations (FAA), the Transportation Security Administration (TSA) or any prevailing Airport Security Program, as they may be amended hereafter, and to take such steps as may be necessary or directed by Authority to ensure that all contractors, subcontractors, subtenants, employees, invitees and guests comply with such requirements. If Signature and/or Authority incur any fines and/or penalties imposed by the FAA, TSA, or the Authority as a result of the acts or omissions of Sublessee or its officers, directors, employees, agents, contractors, subcontractors, subtenants, invitees or other representatives, Sublessee agrees to pay and/or reimburse all such fines and penalties, as well as, any costs and expenses related thereto. Sublessee further agrees 13 CADocuments and SeQingMlbrewerlLocal Set8ngslTemp\PSP Hangars LLC revised final 062804.doc 6AA/6 � � to cure any security deficiency as may be determined as such by Authority, the FAA or the TSA. Signature reserves the right to take whatever action necessary to cure, at Sublessee's expense, any security deficiency as may be determined as such by Authority, the FAA or TSA, in the event Sublessee fails to remedy the security deficiency. 14. Environmental Removal and Disposal. a. Compliance with Environmental Regulation. During the Term, Sublessee shall be solely responsible for the proper removal and disposal of all hazardous substances, hazardous wastes and petroleum products as defined and .regulated by State and Federal Regulation (whichever is applicable) (collectively, "Regulated Substances") generated by Sublessee and/or its employees, servants, agents, contractors, subcontractors, subtenants and invitees as a result of any of their construction, utilization, operation and maintenance conducted on, to, under and from the Hangar Facility and the Leased Premises. Where required by applicable law, such removal and disposal shall include, but not be limited to, Sublessee manifesting such Regulated Substances under Sublessee's assigned Environmental Protection Agency Identification Number and ensuring that removal of such Regulated Substances from the Hangar Facility and Leased Premises, Signature's leasehold and the Airport is accomplished in accordance with prevailing and applicable Authority, State and Federal regulations and laws. Additionally, environmental contamination which impacts the Leased Premises a result of Sublessee's or Sublessee's officers, directors, employees, agents, servants, contractors, subcontractors, subtenants or invitees improper storage or handling, or leakage of any Regulated Substances on the Leased.Premises, shall be the Sole responsibility and liability of Sublessee and Sublessee shall address such contamination which meets or exceeds established cleanup levels to the extent required by a government agency exercising jurisdiction over the contamination. Prior to the termination of this Sublease and Sublessee's subsequent vacation of the Leased Premises (and any Sublessee Condominium Owner), Sublessee shall remove all Regulated Substances related to its operations, including, but not limited to, its contractors, subcontractors agents, servants and subtenants, therefrom and ensure such Regulated Substances' proper remediation and/or disposal. b. Environmental Audits. Provided the Authority shall expressly require Signature to undertake environmental testing of its Airport premises in conjunction with the prevailing Master Lease expiration or termination (or the expiration or termination of any replacement Master Lease subsequently entered into between Signature and the Authority) or for any other bona fide reason during the effectiveness of the Sublease, Sublessee acknowledges that Signature may enter the Leased Premises from time to time to conduct environmental audits. If such environmental audit reveals the presence of contaminants in excess of acceptable levels under applicable law as a result of Sublessee's use of the Leased Premises, Signature shall serve written notice to Sublessee to correct the conditions within seven (7) days. Sublessee shall act diligently to remove any and all such contaminants and to take all such prompt action necessary to satisfy Signature and any authorities having jurisdiction over the Leased Premises that proper remediation has occurred as described above. If Sublessee fails to act within the seven (7)day period, Signature shall act to correct the conditions and shall be 14 CADocuments and SetfngsljbrewerlLocal Settings%TemplPSP Hangars LLC revised final 062804.doc g � entitled to reimbursement for any and all costs directly or indirectly associated with such corrective action. The documents identified in Exhibit E and incorporated by reference herein constitute a baseline assessment of conditions and the time of the Contract Date. Provided a Phase I and/or Phase II environmental assessment of the Leased Premises is undertaken and performed (or caused to be performed) by Sublessee, the assessment results shall be subsequently and shall amend the baseline assessment of Conditions prior to the Contract Date. C. Environmental Indemnification. Sublessee shall indemnify and save harmless Signature and the Authority from and against any and all environmental claims, liabilities, damages, fines, penalties, losses or impairments, costs of clean up and/or remediation, consultant's fees, including but not limited to any penalty or fine (collectively "Claims") imposed by any governmental agency and the expense of cleaning up or disposing of any Regulated Substances or environmental contamination, as well as any and all consultant's fees, and reasonable attorneys' fees associated therewith (collectively, "Environmental Damages') which arise from Sublessee's or Sublessee's officers, directors, employees, agents, servants, contractors, subcontractors, subtenants or invitees use and occupancy of the Hangar Facility and the Leased Premises, but specifically excluding any claims arising from Regulated Substances on the Leased Premises prior to the Contract Date of this Sublease. The foregoing indemnities shall survive the termination or expiration of this Sublease. 15. DISCLAIMER OF LIABILITY. NOTWITHSTANDING THE PROVISIONS OF THE INDEMNIFICATION PROVISIONS SET FORTH IN THIS SUBLEASE, THE PARTIES HEREBY EXPRESSLY AGREE THAT UNDER NO CIRCUMSTANCES SHALL ANY SIGNATORY PARTY BE LIABLE TO ANY OTHER SIGNATORY PARTY (OR ANY PARTY CLAIMING THEREUNDER THROUGH A SIGNATORY PARTY, INCLUDING, BUT NOT LIMITED TO CONTRACTORS, SUBCONTRACTORS, SUBTENANTS, CLIENTS OR CUSTOMERS) FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES, WHETHER IN CONTRACT OR TORT (INCLUDING STRICT LIABILITY AND NEGLIGENCE), SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE, LOSS OF USE, DIMINUITION OF VALUE, LOSS OF ANTICIPATED PROFITS OR THE COSTS ASSOCIATED WITH REPLACEMENT OR SUBSTITUTE AIRCRAFT. 16. Insurance. a. Sublessee shall require that each Condominium Owner obtain from a financially solvent insurance carrier reasonably acceptable to Signature the following types and minimum amounts of insurance as set forth: i. Worker's Compensation at statutory limits, if,not otherwise exempt; and 15 C:1Documenls and SetlingsljbrewerIocal SettingsVempTSP Hangars LLC revised final 062804.doc 4 ii. Employer's Liability Insurance - One Million Dollars ($1,000,000.00) combined single limit and written on an occurrence basis, if not otherwise exempt; and Ill. Commercial General Liability — Two Million Dollars ($2,000,000.00) or such lesser amount as is available but in no event less than $1,000,000.00) combined single limit, written on an occurrence basis, including endorsements to expressly include Premises Liability, Aircraft Liability, and, if applicable, Completed Operations Liability and Products Liability; and iv. Automobile Liability — Coverage applicable off Airport Operating Area ("AOA"). Automobiles are prohibited access to the ADA.; V. All - Risk Property Insurance coverage commensurate with the value of Hangar Facility and contents therein, including insurance on all Leased Premises improvements against loss or damage by fire and against loss or damage by any other risk now and from time to time insured against by "extended coverage" provisions of policies generally in force on improvements of like type in Riverside County, California, in amounts sufficient to provide coverage for the full insurable value of said improvements; the policy for such insurance shall have a replacement cost endorsement or similar provision. "Full insurable value" shall mean actual replacement value and such full insurable value; Environmental/Pollution Liability — Two Million Dollars ($2,000,000.00), if Condominium Owner performs its own maintenance of Aircraft, contrary to the provisions of paragraph 2 of this Sublease. b. Sublessee shall obtain from a financially solvent insurance carrier reasonably acceptable to Signature, the following types and minimum amounts of insurance as set forth: I. Commercial General Liability — Two Million Dollars ($2,000,000.00)or such lesser amount as is available but in no event less than $1,000,000.00 combined single limit, written on an occurrence basis, including endorsements to expressly include Premises Liability and if applicable, Completed Operations Liability and Products Liability; and ii. All - Risk Property Insurance coverage commensurate with the value of Hangar Facility and contents therein, including insurance on all Leased Premises improvements against loss or damage by fire and against loss or damage by any other risk now and from time to time insured against by"extended coverage" provisions of policies generally in force on improvements of like type in Riverside County, California, in amounts sufficient to provide coverage for the full insurable value of said improvements; the policy for such insurance shall have a replacement 16 CADocuments and Settings%jbreweAl-oval SettingsMrnp1PSP Hangars LLC revised final 062604.doc (99' 4 cost endorsement or similar provision. "Full insurable value" shall mean actual replacement value and such full insurable value. All such required liability insurance, excepting Workers' Compensation, shall name Signature, its parent, subsidiary, related and affiliated companies, and the Authority as additional insureds. All required insurance policies shall be evidenced by certificates of insurance which provide at least thirty (30) days advance written notice of any cancellation or changes adverse to the interests of Signature, its parent, subsidiary, related and affiliated companies, the Authority or Sublessee. Prior to any construction, Sublessee agrees to deliver certificates evidencing such insurance described herein to Signature at Signature Insurance Department, PO Box 9085, Mission Viejo, CA 92690- 9085. It is further agreed that the insurance policies of Sublessee and any party claiming through Sublessee hereunder, forthe coverage described herein, shall respond on a primary basis to the extent of the indemnity provisions required of Sublessee as set forth in this Sublease. Sublessee and its insurance carrier(s) agree to waive any and all rights of subrogation in favor of Signature in conjunction with Signature's performance under this Sublease. NOTWITHSTANDING THE PROVISIONS OF THIS ARTICLE, FOR PURPOSES OF THIS SUBLEASE, SUBLESSEE ACKNOWLEDGES ITS POTENTIAL LIABILITY IS NOT LIMITED TO THE AMOUNT OF LIABILITY INSURANCE IT MAINTAINS NOR TO THE LIMIT REQUIRED HEREIN. 17. Compliance With Laws. Sublessee and all parties referenced in this Sublease as claiming through or on behalf of Sublessee including, but not limited to, Sublessee's contractors, subcontractors, subtenants, servants and agents hereby agree to be bound in the operation, occupancy and maintenance of the Hangar Facility by all prevailing and applicable Authority and State of California rules, regulations and ordinances, the reasonable rules and regulations of Signature and all other applicable governmental laws, rules, regulations, statutes and ordinances, whether Authority, State or Federal, including but not limited to, all environmental laws, as well as any applicable laws, rules, regulations, statutes and ordinances which may be promulgated and enacted by a competent and ruling jurisdiction during the Term or any subsequent renewal hereunder. Upon written objection from Signature, the Authority or any other governmental agency having jurisdiction concerning the condition of the Hangar Facility or any other portion of the Leased Premises, the conduct of Sublessee's employees, agents, contractors, subcontractors or invitees, Sublessee shall immediately remedy the cause of the objection. Failure to remedy the aforementioned objection in a manner deemed acceptable to the objecting Party shall constitute an act of default hereunder. 18. DISCLAIMER OF WARRANTIES. SUBLESSEE ACKNOWLEDGES THAT NEITHER SIGNATURE NOR THE AUTHORITY HAS MADE OR WILL MAKE ANY WARRANTIES TO SUBLESSEE WITH RESPECT TO THE CONSTRUCTION OF ANY IMPROVEMENTS UNDERTAKEN TO THE LEASED PREMISES. SIGNATURE 17 CADocuments and Set ings\jbrewer\Local SettingsUempTSP Hangars LLC revised final 062804.doc AND THE AUTHORITY EXPRESSLY DISCLAIM ANY EXPRESS OR IMPLIED WARRANTY THAT THE LEASED PREMISES ARE OR WILL BE SUITABLE FOR SUBLESSEE'S INTENDED COMMERCIAL PURPOSES. 19. Broker. Signature and Sublessee acknowledge that no broker was instrumental in consummating this Sublease and that no conversations or prior negotiations were had with any broker. Signature agrees to defend, indemnify and hold Sublessee and the Authority harmless against any claims for a brokerage commission(s) arising out of any conversations or negotiations had by Signature with any broker. Sublessee agrees to defend, indemnify and hold Signature and the Authority harmless against any claims by any broker for a brokerage commission(s) arising out of this Sublease and/or any conversations or negotiations had by Sublessee with any broker, 20. Notices. Any notice or demand required or to be given or made hereunder from one Party to another Party shall be deemed properly delivered or made on the third (3rd) business day after being forwarded by United States Postal Service certified mail, postage prepaid addressed to a Party at the addresses set forth below. Such notice given via facsimile (shall be deemed delivered as of the date shown on written confirmation of receipt required to be obtained by the transmitting Party). Any of the Parties may from time to time designate a replacement address for this purpose by giving written notice thereof to the other two Parties hereunder. In the case of Signature: Signature Flight Support Corporation Attention: General Manager Palm Springs Regional Airport 210 North El Cielo Palm Springs, California 92262 Facsimile: 760-327-6509 and Signature Flight Support Corporation Attention: Contracts 201 South Orange Avenue, Suite 1100 Orlando, Florida 32801 Facsimile: (407) 648-7352 In the case of Sublessee: PSP Hangars I LLC Attention: Michael E. Dunn 2939 Ohio Way Denver, Colorado 80209 Facsimile: (303) 777-7823 21. Default and Remedies. a. Default by Sublessee and Available Signature Remedies. In case of any breach hereof by Sublessee, in addition to all other rights available to any of the Parties at law or equity hereunder in addition to Signature's rights under this Sublease, Signature shall reserve and possess all the rights against Sublessee as would be 18 C:\Documents and Setiingsljbrewer\Local SetlingsWemp\PSP Hangars LLC revised final 062804.doc available to the Authority against Signature under the Master Lease if such breach were by Signature thereunder; provided, however, that if Signature exercises its rights to terminate this Sublease in whole or as it pertains to Condominium Owner's premises in part, Signature shall have no right to recover Aggregate Rent thereunder from the Condominium Owner from and after the date Signature obtains possession of the Condominium Owner's premises by legal process or otherwise. However, this waiver does not apply if Condominium Owner has financed more than 75% of its unit. In the event Sublessee defaults in the performance of any of the terms and provisions hereof and Signature places the enforcement of this Sublease in the hands of an attorney, the prevailing party shall be entitled to recover its attorney's fees and expenses, as a result thereof including, but not limited to, reasonable attorneys'fees. b. Events of Default. Without limitation, each of the following shall constitute an event of default (jointly and severally hereinafter, "Event of Default") under this Sublease: i. if Sublessee shall make a general assignment for the benefit of creditors or file a voluntary petition in bankruptcy or a petition or answer seeking its reorganization or the readjustment of its indebtedness under the United States Bankruptcy Code (the "Code") or any other similar law or statute of the United States or of any state, or consent to the appointment of a receiver, trustee or liquidator of all or substantially all of the property of Sublessee; or ii. if by order or decree of a court of competent jurisdiction Sublessee shall be adjudged bankrupt, or an order shall be made approving a petition seeking its reorganization, or the readjustment of its indebtedness under the Code or any law or statute of the United States or any state, territory or possession thereof, or iii. if by or pursuant to any order or decree of any court of governmental authority having jurisdiction, a receiver, trustee or liquidator shall take possession or control of all or substantially all of the property of Sublessee for the benefit of creditors; or iv. if Sublessee shall fail to pay any portion of Aggregate Rent or other money payments required by this Sublease and such failure shall not have been remedied within ten (10) days following receipt by Sublessee of written demand from Signature; or V. if Sublessee should abandon the Leased Premises for a period of thirty (30) days. Such provision applies only to Sublessee and to any Condominium Association and does not apply to any individual condominium owner. vi, except as provided under (iv) above, if Sublessee shall default in fulfilling any of the terms, covenants or agreements to be fulfilled by it hereunder, or under the Master Lease, and shall fail to remedy any such default within thirty (30) days following receipt by Sublessee of written demand from Signature to do 19 CADocuments and Settings\jbrewer\Loml Settings\Temp\PSP Hangars LLC revised final 062804.doc so, or if by reason of the nature of such default the Event of Default cannot be remedied within the thirty (30) day period beginning from receipt by Sublessee of written demand from Signature to do so, then, if Sublessee shall have failed to commence the remedying of such Event of Default within said thirty (30) days following such written demand, or having so commenced, shall fail thereafter to continue with diligence to prosecute the remedying thereof. c. Termination Remedy. If an Event of Default by Sublessee occurs, Signature shall have the immediate option, but shall not be obligated, either to terminate this Sublease and to sue for damages as limited by section 21(a) or to proceed as set forth in this Sublease. d. Reentry. In the event of any Event of Default by Sublessee, Signature shall also have the right, to the fullest extent permitted by law, with or without terminating this Sublease, to re-enter the Leased Premises and remove all persons and property from the Leased Premises; such property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of Sublessee subject to Signature's right to any lien. No re-entry or taking possession of the Leased Premises by Signature pursuant to this Section shall be construed as an election to terminate this Sublease unless a written notice of such intention is given to Sublessee. If Signature shall elect to re-enter the Leased Premises under the provision of this Section, Signature shall not be liable for damages by reason of such re-entry. e. Right to Continue Lease. If Signature does not elect to terminate this Sublease as provided above, Signature may from time to time, without terminating this Sublease, enforce all of its rights and remedies under this Sublease, including the right to recover all rent as it becomes due. Sublessee acknowledges that Signature shall have the remedy described in California Civil Code Section 1951.4. f. Reletting of Leased Premises. In the event that Signature should elect, pursuant to this Article 20, to relet the Leased Premises or any part thereof on terms and conditions as Signature in its sole discretion may deem advisable with the right to make alterations and repairs to the Leased Premises, it may execute any new lease in its own name. Sublessee hereunder shall have no right or authority whatsoever to collect any rent from such sublessee. Unless Signature elects to terminate the Lease as provided above, no such reletting shall effect a termination of this Sublease. The proceeds of any such reletting shall be applied as follows: I. First, to the payment of any indebtedness other than rent due hereunder from Sublessee to Signature, including but not limited to storage charges; ii. Second, to the payment of the costs and expenses of reletting the Leased Premises, including brokerage commissions, alterations and repairs which Signature, in its sole discretion, deems reasonably necessary and advisable and reasonable attorneys' fees incurred by Signature in connection with the retaking of the said Leased Premises and such reletting; 20 CADocuments and Settingsl1brewer1ocal Settings\TempTSP Hangars LLC revised final 062804.doc ,1 Ill. Third, to the payment of rent and other charges due and unpaid hereunder; and iv. Fifth, to the payment of future rent and other damages payable by Sublessee under this Sublease, if any. g. No Termination. Signature shall not be deemed to have terminated this Sublease, waived Sublessee's right to possession of the leasehold, waived Sublessee's liability to pay rent thereafter, nor waived Sublessee's liability for damages under any of the provisions hereof, unless Signature shall have notified Sublessee in writing that it has so elected to terminate this Sublease or waive such provisions. Sublessee agrees that the service by Signature of any notice pursuant to the unlawful detainer statutes of the State of California and Sublessee's surrender of possession pursuant to such notice shall not (unless Signature elects to the contrary at the time of, or at any time subsequent to the service of, such notice, and such election be evidenced by a written notice to Sublessee) be deemed to be a termination of this Sublease or of Sublessee's right to possession thereof. h. Suspension of Services. In the event of an Event of Default by Sublessee hereunder, Signature shall have the right, at its option, to suspend or discontinue all or any one or more of the services specified herein during continuance of any such default; and no such suspension or discontinuance shall be deemed or construed to be an eviction or ejection of Sublessee. I. Cumulative Remedies. All rights, options and remedies of Signature contained in this Sublease shall be construed and held to be cumulative, and no one of them shall be exclusive of the other, and Signature shall have the right to pursue any one or all of such remedies No waiver by Signature of a breach of any of the terms, covenants or conditions of this Sublease by Sublessee shall be construed or held to be a waiver of any succeeding or preceding breach of the same or any other term, covenant or condition therein contained. No waiver of any default of Sublessee hereunder shall be implied from any omission by Signature to take any action on account of Such default if such default persists or is repeated and no express waiver shall affect default other than as specified in said waiver. The consent or approval by Signature to or of any act by Sublessee requiring Signature's consent or approval shall not be deemed to waive or render unnecessary Signature's consent to or approval of any subsequent similar acts by Sublessee. j. Signature Default. Signature shall not be deemed to be in default in the performance of any obligation required to be performed by it under this Sublease unless and until it has failed to perform such obligation within forty-five (45) days after written notice by Sublessee to Signature specifying the manner in which Signature has failed to perform such obligation; provided, however if the nature of Signature's obligation is such that more than forty-five (45) days are required for its performance, then Signature shall not be deemed to be in default if it shall commence such performance within such forty- five (45) day period and thereafter diligently prosecute the same to completion within ninety (90) days if such period is reasonable given the nature of the default. 21 C1Documents and SeftingsljbrewehLocal SettingsWempTSP Hangars LLC revised final 062604.doc Aa4 22. Independent Contractor. The relationship between Signature and Sublessee shall be that of independent contractors for all purposes and in no event shall persons employed or retained by either party, irrespective of the type of uniform worn, be held or construed to be employees or agents of the other. All persons' performance hereunder and the manner and details of performance thereof shall be under the exclusive control of the respective employing or subcontracting party, with such employing or subcontracting party possessing the sole right to direct such persons' performance. 23. Force Majeure. Excepting the payment of Aggregate Rent and any other sums due hereunder by Sublessee, neither Sublessee or Signature shall be liable to each other for its failure to perform under this Sublease or for any loss, injury, damage or delay of any nature whatsoever resulting therefrom caused by any act of God, act of nature, fire, flood, wind storm, strike, labor dispute, riot, terrorism, insurrection, war or any other cause beyond either Party's control. 24. Governing Law & Mediation / Arbitration. This Sublease shall be construed, interpreted and enforced accordance with the laws of the State of California. a. Negotiation. Signature and Sublessee agree to negotiate in good faith, for a period of thirty (30) days from the date of notice of all unsettled claims, disputes, and other matters in question between them arising out of Sublessee's obligations to construct the Hangar Facility or the breach thereof ("Disputes") before exercising their dispute resolution rights under this Sublease. b. Mediation. Signature and Sublessee agree to submit, prior to arbitration, all, Disputes) to mediation under the auspices of the American Arbitration Association. Demand for mediation shall be made within a reasonable time after cessation of negotiations. In no event shall the demand for mediation be made after the date when institution of legal or equitable proceedings based upon such Dispute would be barred by the applicable statute of limitations. c. Withdrawal; Fees; Disqualification. Mediation shall be private, voluntary and non-binding. Any Parry may withdraw from the mediation at any time before signing a settlement agreement upon written notice of each other Party and to the mediator. The mediator shall be neutral and impartial. The mediator's tees shall be shared equally by the Parties. The mediator shall be disqualified as a witness, consultant, expert or counsel for either Party with respect to the matters in Dispute and any related matters. d. Confidentiality. Unless the Parties agree otherwise, the entire mediation process shall be confidential and without prejudice. The Parties and the mediator shall not disclose any information, documents, statements, positions or terms of settlement. Nothing said or done or provided by the Parties in the course of mediation shall be reported or recorded or, except as ordered by a court of competent jurisdiction, placed in any legal proceeding or construed for any purpose as an admission against interest. 22 CADocuments and Settings\jbrevverlLowl SettingsWempTSP Hangars LLC revised final 062804.doc Nevertheless, evidence otherwise discoverable or admissible is not excluded from discovery or admission as a result of its use in mediation. e. Arbitration. All disputes which are not resolved by mediation shall be subject to and decided exclusively by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association currently in effect, Demand for arbitration shall be filed with the other Party to this Sublease and with the American Arbitration Association. In no event shall a demand for arbitration be made after the date when legal or equitable proceedings based upon such Dispute would be barred by the applicable statute of limitations. f. Injunctive Relief Pending Arbitration. The Parties agree that each Party has an interest in the confidentiality of its internal affairs and has an interest in, and obligation to maintain, the confidences of its clients. Nothing in this Section shall affect the Parties' agreement that remedies at law may be inadequate to protect the status quo pending appointment of the arbitrator(s) or to protect against irreparable harm or to protect against disclosure of confidential information or client confidences. Each Party shall be entitled to injunctive'relief by the California Superior Court or the United States District Court having jurisdiction over the Leased Premises, against any action of a Party which threatens irreparable harm, threatens the status quo, or which may constitute a breach of the confidentiality requirements agreed to herein or imposed by law. It is understood that such injunctive relief is intend as a provisional remedy pending arbitration, and that recourse to injunctive relief shall not constitute a waiver of the right to arbitrate. g, Hearing Locale; Enforceability. Any arbitration hearing conducted pursuant to this Permit shall be held in Palm Springs, California, or as otherwise mutually agreed between the Parties. The arbitrator(s) shall issue a written statement specifying the reasons for the award, which shall be final and binding on both Parties, and in such format that judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof. h. Limitations on Arbitrator(s). The arbitrator(s) (i) shall have the authority to award injunction relief or to direct specific performance, if warranted, and (ii) shall not have the authority to award punitive damages. I. Arbitration Fees. Each Party shall bear its own attorneys fees, witness fees and other costs in preparing and presenting its position at arbitration. The fee of the arbitrator, however, shall be borne and paid by the Party not substantially prevailing in the matter arbitrated, as specifically so determined by the arbitrator. j. Waiver of Jury Trial. The Parties stipulate that trial by jury is waived. 25. Assignment and Subletting. a. Sublessee may assign Sublessee's rights and obligations arising under this Sublease to the Association and the original Sublessee shall thereupon be released, provided, however, that continuing obligations shall not be released for conditions whether then known to exist or later learned to have existed at the time of assignment. 23 C:Tocunnents and Settings\)brewer\Loeal Settings\Temp\PSP Hangars LLC revised final 062804.doc b. Sublessee may further sublease all of or a portion of the Hangar Complex; provided, however, the Sublessee shall notify Signature of any such sublease and of the name of the sublessee subject to the provisions of paragraph 6 of this Sublease. c. Any such sublease shall be subject to all the provisions of this Sublease. In the event of an assignment or subletting of the Hangar Facility, Sublessor acknowledges such action shall be construed as a release. 26, Incorporation of Sublease Provisions in Subtenant Agreements. Excepting monetary or other proprietary issues, Sublessee expressly agrees and acknowledges that any subtenant leases subsequently entered into pursuant to the provisions of Article 25 hereunder, shall not specify any terms or conditions which in any manner stipulate, suggest or otherwise be interpreted to convey primacy or priority over any term and condition set forth in this Sublease or the Master Lease and the indemnities, waivers, insurance endorsements and limitations of liability set forth in the Sublease shall be subsequently incorporated by Sublessee within all subtenant contracts or leases with such indemnities, waivers, insurance endorsements and limitations of liability being deemed applicable and binding upon the joint and several performance of Sublessee and its subtenants thereunder. 27, Concurrent Term of Subtenant Agreements With Sublease. The term of any subtenant agreement entered into by Sublessee shall at no time exceed the Term specified in the Sublease. In the event this Sublease is thereafter terminated for any reason prior to the expiration period date of the Term or any subsequent extension or renewal thereto including, but not limited to, Sublessee's uncured acts of default, then the termination of this Sublease shall also serve as the termination of any and all subtenant agreements entered into by Sublessee. 2& Fuel Purchases. Sublessee (and any subtenants subsequently authorized to occupy the Hangar Facility) agrees to purchase reasonable quantities of Jet A Fuel or 100LL Avgas ("Fuel") which they require while at the Leased Premises from Signature in connection with the operation of the Aircraft based at the Hangar Facility in exchange for Signature furnishing Sublessee and its subtenants the use of Signature's general aviation terminal facilities and amenities, as well as, furnishing other basic or ancillary services, including, but not limited to, all necessary towing of the Aircraft Consistent with the provisions of this Sublease, Signature reserves the express right to fuel and perform/provide ancillary services to the Aircraft consistent with the terms of the Master Lease. The provisions and representations set forth in this Article constitute an integral part of the basis of bargain and material consideration for Signature to enter into this Sublease. 29. Performance of Ancillary Services. Ancillary services including GPLI's and towing requested by Sublessee and/or any of Sublessee's subtenants hereunder which are not otherwise specifically addressed or contemplated within the scope of this 24 CADocuments and SettingsltbrevverlLocal SettingsUempTSP Hangars LLC revised final 062804.doc Sublease, may be undertaken and performed or caused to be undertaken and performed by Signature consistent with the terms and conditions set forth herein, with fees and charges for such ancillary services, to be at Signature's then prevailing rates. 30. Signature Right of First Notice of Intended Sale. in the event at any time during the Term or any subsequent extension, renewal or replacement thereof, Sublessee or its sublessee should decide to sell its interests in the Leased Premises, Signature shall possess the right of first notice of intended sale in order to purchase the then-existing Improvements at the reasonable price and terms being offered upon written notice of such election from Signature to Sublessee or to its sublessee after Sublessee receives Signature's written notice of intended sale. If Signature does not elect to purchase the Improvements in writing within ten (10) business days after such notice then Sublessee or its sublessee, as applicable, is free to sell Its interests without further notice to Signature. This paragraph shall not apply to any transfer resulting from a mortgage or deed of trust, or any transfer by Sublessee or any Sub-sublessee of its interest to a family member, or to any entity controlled, controlling or controllable by Sublessee or such Sub-sublessee. The right of first refusal shall be memorialized in any Memorandum of Sublease referred to in Article 37 herein. 31. Amendment. No amendment, modification or alteration of the terms of this Sublease shall be binding unless the same shall be in writing, dated subsequent to the date hereof and duly executed by the Parties hereto. 32. Time of Essence. The Parties hereto agree that time is of the essence in the joint and several performance of each and every covenant and the satisfaction of each and every condition and obligation specified in this Sublease. 33. Entire Agreement. The terms and provisions of all Exhibits described herein and attached hereto are made a part hereof for all purposes. This Sublease constitutes the entire agreement of the Parties with respect to the subject matter hereof and all prior correspondence, memoranda, agreements or understandings (written or oral) with respect hereto are merged into and superseded by this Sublease, except for the Parties'joint and several obligations under the Master Lease. 34, Severability. If any term or provision of this Sublease, or the application thereof to any person or circumstance, shall to any extent be invalid or unenforceable, the remainder- of this Sublease, or the application of such provision to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each provision of this Sublease shall be valid and shall be enforceable to the extent permitted by law. 36. Authority Consent Required. Sublessee acknowledges that, pursuant to the provisions of the Master Lease, Signature is required to obtain the Authority's written consent to this Sublease, and accordingly, the obligations, understandings and commitments of the Parties as set forth herein are expressly subject to Signature obtaining such Authority consent. 25 CADocuments and Settingsljbrewer\Local Settings\Temp\PSP Hangars LLC revised final 062804.doc 37. Estoppel Certificates. Sublessee and Sublessor shall, within thirty (30) days after written request from the other, execute, acknowledge and deliver a statement (i) certifying that this Sublease is unmodified and in full force and effect or, if modified, stating the nature of such modification and certifying that this Sublease as so modified, is in full force and effect (or if this Sublease is claimed not to be in force and effect, specifying the ground(s)therefor) and any dates to which Aggregate Rent has been paid in advance, and the amount of any security deposit, (ii) acknowledging that there are not, to such party's knowledge, any uncured defaults on the part of Signature or the Authority or Sublessee hereunder, or specifying such defaults if any are claimed, and (ill) certifying such other matters as Signature and/or the Authority or Sublessee may reasonably request, or as may be requested by Signature's and/or the Authority's or Sublessee's current or prospective holders, insurance carriers, auditors, and prospective purchasers. Any such statement may be relied upon by any such parties. 38. Memorandum of Sublease. Upon the request of any of the Parties, the other Party shall join in the execution of a "Memorandum of Sublease" in recordable form. IN WITNESS WHEREOF, the undersigned Parties have executed this Sublease effectiJasofe date and year first written above. SIGNAIGHTSUPPORT PSP HANGARSCORPBy: By: G. FarmerTitle: Vdent—General Aviation Tit Operations Date: 1 ,(P"0� Date: 01 ' (3( ' Ur APPRO1 D AS O0 ORM: l(l la LEGAL 6E STATE OF FLORIDA COUNTY OF ORANGE This instrument was acknowledged before me on by John G. Farmer, Vice President — General Aviation Operations, of SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation and personally known to me on behalf of said corporations. NOTARY SEAL Notary Public 26 C:\Doouments and Settings\jbrewer\Loral SettingsWempTSP Hangars LLC revised final 662804.doo AT � � Printed or Typed Name of Notary My Commission expires: STATE OF COLORADO 17 COUNTY OF�,I MA lb s insfr�nt y was acknowledged before me on of PSP HANGARS I LLC, a Colorado limited liabfffty company, personally kno n to wb on behalf of said limited liability company. NOTA SE L -n Notary Public ��t2tiC z CPC 29 ty� Printed or Typed Name of Notary G� ..Ft, a My commission expires: y ........ . jy °.fin'VaR 9 m• A •��COVE IAY Cannbslon E>q�ires 05K1d"1008 27 CADocuments and settingsljbrewer\Local SettingalTemplPSP Hangars LLC revised fina1062804.doc pp v� EXHIBIT A COPY OF LEASE AGREEMENT ENTERED INTO BETWEEN SIGNATURE AND THE AUTHORITY OF (per subsequent attachment) 26 �1 CADocuments and SettingsljbrswerlLocal Settings\TempTSP Hangars LLC revised final 062804.doc LEASE WITH SIGNATURE FLIGHT SUPPORT CORPORATION FOR FIXED BASE OPERATOR (FBO) SERVICES AT THE PALM SPRINGS INTERNATIONAL AIRPORT THIS LEASE ("Lease") is made and entered into this 21s' day of January, 2004 by and between the. CITY OF PALM SPRINGS, a municipal corporation ("City"), and SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation ("Tenant"). RECITALS A. City entered into those certain lease agreements for certain real property located in the Palm Springs International Airport in the City of Palm Springs, County of Riverside, State of California ("Airport"), described as: (i) Agreement No. 684 with Gates Aviation Corporation, dated October 1, 1969, including duly authorized amendments, addenda, assignments and extensions thereto, which agreement was assigned to Tenant by Consent to Assignment of Lease dated May 3, 2002 (collectively"Agreement No. 684'); and (11) Agreement No. 3742, dated December 13, 1996, with AMR Combs, Inc., including any duly authorized amendments, addenda and extensions thereto, which agreement was assigned to Tenant by Consent to Assignment of Lease dated May 3, 2002 (collectively"Agreement No. 3742'), B. City and Tenant wish to amend Agreements Nos. 684 and 3742, to extend the term, remove certain parcels leased by Tenant, include certain other parcels for lease by Tenant, impose construction obligations, and modify some of the financial obligations of the parties there under. C. City and Tenant believe that there exists significant confusion about the parties' outstanding obligations under Agreement Nos. 684 and 3742 and creating further amendments to such agreements to accomplish the desired amendments thereto would further create confusion. Accordingly, the parties wish to enter into a new, comprehensive lease agreement that incorporates certain terms of Agreements Nos. 684 and 3742, while including such desired modifications through the present Lease. D. The parties wish to rescind Agreement Nos. 684 and 3742 and supersede such agreements with the present Lease. E. The City wishes to lease to Tenant and Tenant wishes to lease from City that portion of the Airport defined in this Lease as the Demised Premises for use by Tenant in connection with its non-exclusive .fixed based operation services pursuant to the terms of this Lease. 1. LEASE OF DEMISED PREMISES I TERMINATION OF AGREEMENT NOS. 684 and 3742. In consideration of the promises, payments and obligations by Tenant under this Lease, City hereby leases to Tenant the "Demised Premises", together with the improvements located thereon, located in the Airport, as more particularly described in Exhibit "A" hereto and depicted on Lease Property Plot Plan attached as Exhibit "B" hereto, and RV#15925 v1 _ - 3 Tenant hereby leases the Demised Premises from City pursuant to the provisions of this Lease. Tenant agrees that it accepts the Demised Premises `As-Is" and "Where-Is" without any representations or warranties of any nature or kind whatsoever from City. By entering into this Lease and as of the Effective Date herein, the parties hereby agree that this Lease supercedes Agreements Nos. 684 and 3742 in their entirety and that Agreements Nos. 684 and 3742 are hereby terminated and of no further effect. 2. DEMISED PREMISES. The Demised Premises shall consist of the following' parcels, subject to the provisions set forth below: 2.1 Executive Terminal and Hangar (Parcel 1). From the Commencement Date until the earlier of either(1) Tenant's completion of construction of its.New Corporate Facility, as described at Section 2.2 below, or (ii) May 31, 2006, the Demised Premises shall include that portion of the Airport within the parcel described at Exhibit "A" hereto and depicted at Exhibit"B" as that part of"Parcel 1"consisting of the entire second story of the current Executive Terminal and that portion of the Executive Terminal as depicted at Exhibit "C" hereto. Tenant acknowledges and agrees that, pursuant to Amendment No. 7 to City's Agreement No. 684, a portion of the first floor of the Executive Terminal, comprising approximately 2,868 square feet, shall be used by the U.S. Bureau of Customs and Border Protection ("Customs"), Tenant further acknowledges and agrees to abide by all security and other regulations imposed by Customs insofar as it affects any portion of the Demised Premises and Tenant shall not enter or breach any such space,without prior written approval of an authorized Customs agent. 2.2 New Corporate Facility (Parcel 1), The Demised Premises shall include that certain parcel within the Airport described at Exhibit "A" hereto and depicted at Exhibit "B" as that part of"Parcel 1" referred to as the "New Corporate Facility." The Demised Premises shall exclude that portion of Parcel 1 shown as the shaded area at Exhibit 'B" in addition to the area excluded under Section 2.1 above. Tenant shall construct improvements to house Tenant's corporate operations and parking facilities (collectively "New Corporate Facility") upon Parcel 1, which construction shall be completed, as evidenced by Tenant's receipt of a duly issued certificate of occupancy, by no later than May 31, 2006 (being within approximately twenty- seven (27) months of the Commencement Date). Tenant's construction of the New Corporate Facility improvement shall be in accordance with Section 7 below. 2.3 Ramp Area (Parcels 2 and 4). The Demised Premises shall include those certain parcels within the Airport designated as an aviation ramp area, described at Exhibit "A" hereto and depicted at Exhibit "B" as "Parcel 2" and Parcel 4 ("Ramp Area"), which Ramp Area Tenant acknowledges shall be accessible by other duly authorized users of the Airport. The Demised Premises shall exclude that portion of Parcel 2 and 4 shown as the shaded area at Exhibit"B" in addition to the area excluded under Section 2.1 above. 2.4 Executive Hangars (Parcels 3 and 6). The Demised Premises shall include those certain parcels within the Airport described at Exhibit "A" hereto and depicted at Exhibit "B" as "Parcel 3" and "Parcel 6" (collectively "Executive Hangars"). Tenant shall construct improvements to Parcels 3 and 6 described as executive hangars in two phases. Parcel 6 shall be constructed in the first phase, which construction shall be completed, as evidenced by Tenant's receipt of a duly issued certificate of occupancy, by no later than May 31, 2005. Parcel 3 shall be constructed in the second phase, depending on the need for additional executive hangars, as reasonably determined by the City and Tenant, beginning no later than May 31, 2006. Construction of the Executive Hangars improvement shall be In accordance with Section 7 below. As necessary, at City's sole cost, City shall relocate the existing lavatory RV$15925 vI -2- dump and wash rack area within Parcel 3 to allow Tenant to commence construction of the new Executive Hangars. 2.5 Future Tie Down Area/Fuel Farm (Parcel 7). The Demised Premises shall include that certain parcel within the Airport proposed as a future tie down area for aviation uses and a portion of which Is currently used by Tenant as a fuel farm, described at Exhibit"A" hereto and depicted at Exhibit"B"as "Parcel 7" ("Future Tie Down Area/Fuel Farm"). 2.6 T-Hanears (Parcel 8). The Demised Premises shall include that certain parcel within the Airport wherein T-Hangers improvements exist for aviation uses, as such parcel is described at Exhibit"A" hereto and depicted at Exhibit "B"as 'Parcel 8" ("T-Hangars"). Before the Commencement Date of this Lease, the City separately leased spaces within the T- Hangars to individual third parties ("T-Hangar Leases"). By executing this Lease, Tenant acknowledges that it has received copies of all existing T-Hangar Leases, which Tenant shall assume as sublessor with such third parties as sub lessees for the remaining term of each such T-Hangar Lease. Tenant shall honor and not increase the rental rates charged by City to the individual third parties under each T-Hangar Lease (currently set at$306.20 per month) for two (2) years following the Commencement Date of this Lease. Tenant shall accept the T-Hangar structures "as is", and shall not be entitled to any compensation by the City for any necessary or desired improvement thereto. Tenant, at its sole cost, shall be responsible for all maintenance of,and necessary or desired upgrades to,the T-Hangers. Tenant shall pay to City a percentage of its gross rental revenues derived from the subleasing of the T-Hangars, as further set forth at Section 4.3 below. 2.7 Parcel 9 (Aircraft Maintenance Hangar) The Demised Premises shall include that certain parcel within the Airport, which parcel is improved and is currently in use as an Aircraft Maintenance Hangar comprised of no more than 4,500 square feet of hangar floor space, 2,000 square feet of office space and two (2) tie down spots located adjacent to the hangar known locally as Signature GSE Hangar—424 N. Civic Drive as depicted at Exhibit "B- 1"and made a part hereof for all purposes as if fully set forth herein to this lease. 2.8 Unimproved Areas (Parcels 10, 11, 12 and 14). The Demised Premises shall include those certain parcel within the Airport, which parcels are unimproved as of the Commencement Date of this Lease and described at Exhibit"A" hereto and depicted at Exhibit "B" as 'Parcel 10", 'Parcel 11, 'Parcel 12" and 'Parcel 14" (collectively "Unimproved Areas"). Tenant may improve the Unimproved Areas with an aeronautical use, provided the City first duly approves in writing any plan of improvement. 2.9 Hangar(Parcel 13). Beginning upon the termination of the lease between the City and the Palm Springs Unified School District (PSUSD), scheduled for June 30, 2005, with two (2) one (1) year renewal options; the Demised Premises shall include that certain parcel within the Airport which parcel is occupied with a WWII Era Aircraft Hangar and attached Office and Storage Area as. of the Commencement Date of this Lease and described at Exhibit "A" hereto and depicted at Exhibit"B" as 'Parcel 13" ("Hangar"). Upon the termination of the lease with the Palm Springs Unified School District for the "Hanger' and by no later than July 1, 2007, Tenant shall submit a plan of improvement for Parcel 13. At its sole cost, Tenant shall demolish the"Hangar'on Parcel 13, and commence improvements within two (2) years of City's approval of such plans. Tenant may improve with an aeronautical use, provided the City first duly approves in writing any plan of improvement. Tenant shall complete such improvements within two (2) years thereafter. The parties shall coordinate in, the 'demolition and 'disposal of the RV O5925 Q -3- 3 �z "Hangar" improvements on Parcel 13 and indemnify and hold each other harmless for any potential environmental mitigation and clean-up penalties and other liabilities related thereto. 2.10 Future Tie Down Area (Parcel 01-2). The Demised Premises shall include that certain parcel within the Airport, a portion of which is unimproved and a portion of which is improved with horse stables and a Quonset Hut, which parcel is described at Exhibit "A" hereto and depicted at Exhibit "B" as "Parcel 01-2" ("Future Tie Down Area"). If so, City shall remove its personal equipment and possessions and the horse stables shall become part of the Demised Premise's. Tenant may demolish the Quonset but (and the horse stables if Tenant exercises its right to lease such portion per this section 2.10) and rebuild an aeronautical use therein, provided the City first duly approves in writing any plan of improvement. Beginning on the Commencement Date, the Demised Premises shall exclude that portion comprising of approximately fifty percent (50%) of Parcel 01-2, which is improved with horse stables, as depicted at Exhibit "B"hereto, until Tenant(1) provides City one hundred twenty (120) days prior notice within the lease term that it wishes to lease such portion, (ii) submits a proposed aeronautical use on such portion, and (Ili) the City approves any plan of improvement. Thereafter, the entire Parcel 01-2 shall be included as part of the Demised Premises. 2.11 Expansion Parcel: Right of First Refusal. For twenty-five (25) years, beginning from the Commencement Date, City shall not lease all or any part of the area of the Airport in which the 21.3159 acre parcel north of the ASR-9 facility is located, as such parcel is further described on Exhibit "A" and depicted on Exhibit "D" as the "Expansion Space", to any third person for longer than three (3) months without complying with the terms of this Section 2.11. At any time that City determines to lease or extend any existing lease covering all or part of the Expansion Space beyond the three (3) months, City shall notify Tenant of the rent for which City is willing to lease the Expansion Space, or part of the Expansion Space. If Tenant, within thirty (30) days after receipt of City's written notice, affirms in writing its agreement to lease the Expansion Space, or part of it, the Expansion Space or part of it shall be included within the Demised Premises and leased to Tenant pursuant to the provisions of this Lease, including, without limitation, the provisions relating to the rights and obligations of the parties with respect to alterations. However, the rent payable under this Lease shall be increased by the amount of rent attributable to the Expansion Space or part of it that is leased by Lessee. The parties shall immediately execute an amendment to this Lease, subject to FAA/City Council approval, stating the addition of the Expansion Space or part of it to the premises. If Tenant does not indicate within thirty(30) days its agreement to lease the Expansion Space or part of it, City thereafter shall have the right to lease or extend any lease covering the Expansion Space or part of it to a third party at the rent stated in the notice. In such circumstance, the right of first refusal provided to Tenant under this Section 2.11 shall terminate upon City's execution of a lease with such third person. (a) Option Price.' !\ G NOME (b) Payment of Option Price. Tenant shall pay City the Option Price on the anniversary date of the Commencement Date for each year of such option period. City will deliver an invoice to Tenant for payment of the Option Price. However, Tenant's obligation to pay the Option Price yearly shall not be contingent upon the City's delivery of such invoice or reminder to Tenant. Should Tenant fail to pay the Option Price within fifteen (15) days of such Commencement Date in any given year of the Option Period, the option granted herein shall automatically terminate and be of no further force or effect. 3. TERM. 3.1 Term. The term of this Lease shall commence on February 1 2004 ("Commencement Date") and shall continue and shall terminate on May 31, 2044 unless earlier terminated as provided herein (collectively referred to as the "Term"). 3.2 Time. Time is of the essence of this Lease. 3.3 Force Maieure, If either party hereto shall be delayed or prevented from the performance of any act required hereunder by reason of acts.of God, strikes, lockouts, labor troubles,terrorism, inability to procure materials, restrictive governmental laws or regulations or other cause without fault and beyond the control of the party obligated (financial inability excepted), performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to 'the period of such delay, provided such party provides the other party written notice of such event within ten (10) days of the commencement of the delay; provided, however, nothing in this Section shall excuse Tenant from the prompt payment of any rental or other charge required of Tenant hereunder except as may be expressly provided elsewhere in this Lease. 3.4 Holding Over. Any holding over after the expiration of the term of this lease, with the consent of City, express or implied, shall be construed to be a tenancy from month to month, cancelable upon thirty (30) days written notice, and at a rental equal to one hundred fifty percent (150%) of the last applicable Monthly Rental and upon terms and conditions as existed during the, last year of the term hereof., 4. RENTAL AND OTHER PAYMENTS. RV 1115925 v] _5_ (a) Adjustment for Lease of "Hanoar". (b) Costs of Living Adjustment. Upon each fifth year anniversary date of the Commencement Date or if the Commencement Date is not an the first day of a month, then on the first day of the next calendar month, the Monthly Rental shall be adjusted in proportion to changes in the Consumer Price Index except that no five (5) year adjustment shall exceed 25%. Such adjustment shall be made by multiplying the original Monthly Rental by a fraction, the numerator of which is the value of the Consumer Price Index for the calendar month three (3) months preceding the calendar month for which such adjustment is to be made and the denominator of which is the value of the Consumer Price Index for the same calendar month immediately prior to Commencement Date. For example, if the adjustment is to occur effective June 1, 2006, the index to be used for the numerator is the index for the month of March 2006 and the index to be used for the denominator is the index for the month of March preceding the Commencement Date. However, in no event shall the rent be reduced below the Monthly Rental in effect immediately preceding such adjustment. The "Consumer Price Index" to be used in such calculation is the Consumer Price Index All Urban Consumers (All Items), for the Los Angeles-Anaheim-Riverside Metropolitan Area, published by the United States Department of Labor, Bureau of Labor Statistics (1982-84 = 100). If both an official index and one or more unofficial indices are published, the official index shall be used. If said Consumer Price Index is no longer published at the adjustment date, it shall be constructed by conversion tables included in such new index. 4.2 Payment of Monthly Rental Tenant shall pay to City the Monthly Rental in advance on the first.day of each calendar month. In the event the Commencement Date does not occur on the first day of a calendar month, Tenant shall pay the rental for the fractional month on the Commencement Date on a per them basis (calculated on a thirty-day month). All rental to be paid by Tenant to City shall be in lawful money of the United States of America and shall be paid without deduction or offset, prior notice or demand at the address designated in Section 15.10 hereof. RV$15925 v1 -6- ' 3 4.3 Percentage Rental for T-Hanger Premises. (a) In addition to the Monthly Rental hereinabove agreed to be paid by Tenant, Tenant shall Pay to City at the time and in the manner specified herein, as additional rental (sometimes referred to herein as 'percentage rental') a sum equal the following for that portion of the Demised Premises referred to in Exhibit "A" and depicted in Exhibit 'B" as the "T- Hangars": The product of the rate set forth in the Fee Schedule, as may be duly revised from time-to-time by the City Council of the City, ("Fee Schedule") payable by Fixed Base Operators times the gross sales made in, upon, or from the Demised Premises with respect to any commercial activity each month during the term hereof. (b) Within thirty (30) days after the end of each calendar month of the term hereof, commencing with the fifteenth (151h� day of the month following the Commencement Date, and ending with the fifteenth (15`) day of the month next succeeding the last.month of the Lease term, Tenant shall furnish to City a statement in writing, certified by Tenant to be correct, showing the total gross sales made in, upon, or from the T-Hangars during the preceding calendar month relating to such commercial activity (or fractional month at the beginning of the term if the Commencement Date is other than the first day of a month), and shall accompany each such statement with a payment to City equal to said percentage of such total monthly gross sales made in, upon, or from the T-Hangars during each calendar month. (c) The term "gross sales' as used herein means the total gross receipts, including the actual charges for all services performed by Tenant and fees charged by Tenant and by anyone including any subtenant, licensee or concessionaire in, at, from, or arising out of the use of the T-Hangars, whether for each or for credit, or otherwise, and including the value of ail consideration other then money received for any of the foregoing, without reserve or deduction for inability or failure to collect, including but not limited to sales, leases and services related to said commercial activity for which there is a FBO fee. Each installment or credit sale shall be treated as a sale for the full price in the month during which such sale is made, irrespective of whether or when Tenant receives payment there for. Gross Sales shall not include sales taxes, so-called luxury taxes, consumers excise taxes, gross receipts taxes and other taxes of any kind or nature now or hereafter imposed upon the sale of merchandise or services, but only if collected separately from the selling price of merchandise or services and collected from customers. 4.4 Additional Rental. For purposes of this Lease, all monetary obligations of Tenant under this Lease, including, but not limited to, insurance premiums, property taxes, maintenance expenses, late charges and utility costs shall be deemed to be additional rental. 4.5 Real Property and Possessory Taxes. In addition to all rentals herein reserved, Tenant shall pay, at the election of City, either directly to the taxing authority or to City, annual real estate taxes and assessments levied upon the Demised Premises (including any annual real estate taxes and assessments levied upon the Demised Premises), as well as any taxable possessory interest 'which Tenant may have in or to the Demised Premises or by reason of its occupancy thereof or operations thereon, as well as all taxable property, real or personal, owned by Tenant in or about the Demised Premises. (Tenant specifically acknowledges that the interest granted under this Lease may be subject to possessory interest taxes.) Such amount shall be paid on the date that is twenty (20) days prior to the delinquent date or, if City receives the tax bill,thirty (30) days after receipt of a copy of the tax bill from City, whichever is later. Even though the term of this Lease has expired and Tenant has vacated the By tAs9is vl -7- . �� �� Demised Promises, when the final determination is made of Tenant's share of such taxes and assessments,Tenant shall immediately pay to City the amount of any additional sum owed. 4.6 Personal Property Taxes. During the term hereof Tenant shall pay prior to delinquency all taxes assessed against and levied upon fixtures, furnishings, equipment and all other personal property of Tenant contained in the Demised Premises, and when possible Tenant shall cause said fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the real property of City. 4.7 Utilities. Tenant shall pay before delinquency all charges for water, gas, heat, electricity, power, sewer, telephone service, trash removal and all other services and utilities used in, upon, or about the Demised Premises by,Tenant or any of its subtenants, licensees, or concessionaires during the term of this Lease. 4.8 Fees and Charges Payable Per Fee Schedule. In addition to all rentals herein reserved, Tenant shall pay City the following fees and charges, within the times set forth below, for the fees incurred in the prior month of the Term with a detailed statement of all business done at the Airport during the previous month for which fees or payments to the City are due: (a) Fuel and Oil Sales. (1) Aviation Retail Fuel and Oil Sales. Tenant shall pay City on or before the 15'h day of each month an amount equal to the cost per gallon for fuel and quart of oil as shown in the Fee Schedule for all gallons/quarts of fuel/oil purchased or delivered annually to the Tenant at the Airport. Tenant shall further pay City an amount equal to the cost per gallon for fuel and quart of oil as shown on the Fee Schedule for fuel and oil purchased or delivered annually at the Airport. In this regard, all fuel and oil received by Tenant and actually delivered by Tenant to regularly scheduled airlines or others operating under contract with the City shall not be subject to such payment. Tenant shall instruct all fuel and oil suppliers to promptly furnish a duplicate copy of all invoices and/or delivery receipts to the City. Tenant shall maintain adequate books of account and records completely showing, at all times, the number of gallons of fuel and quarts of oil delivered to or purchased by Tenant during any calendar month; such records shall be open to inspection and audit by the City. Tenant shall fully comply with all standards related to fuel and oil sales as adopted by the City as regards safety and standards of service. Tenant shall further adopt and maintain retail sales prices for fuels and oils, which are competitive with other certified air carrier airport within a sixty-five mile radius of the Airport. (2) Into-plane Fuel and Oil Sales. Tenant shall pay City on or before the 15" day of each month an amount equal to the cost per gallon as shown in the Fee Schedule for each gallon of aviation fuel delivered annually to airlines or other contract purchasers. (3).Automotive Retail Fuel and Oil Sales. Tenant shall pay City on or before the 15'h day of each month an amount equal to the cost per gallon as shown in the Fee Schedule for each gallon of automotive fuel and oil purchased by or delivered annually to Tenant at the Airport. Tenant agrees that no fuel sales of aviation or other fuels and/or oils will be made in containers. (4) Renegotiation. It is specifically agreed that the fuel gallon fees set out in Sections 4.8(a)(1), (2), (3) and (4) above shall be renegotiated effective the 61h, AV 915925 vl -8- 11fh, 16`h, and 2151 anniversary and every consecutive five (5) year anniversary thereafter of this agreement. Such negotiations to be upon written notice sixty (60) days before such anniversaries. Such renegotiated fees shall be limited, In each negotiation period, to a maximum increase of not more than 25% of the current fees as shown in the Fee Schedule. (b) Sales of New and Used Aircraft. Tenant shall pay City on or before the 15`h day of each month a fee based upon a percentage of the gross sales price, excluding sales tax, of each new or used aircraft sold as shown in the Fee Schedule. (c) Charter/Air Taxi Operation. Tenant shall pay City on or before the 151h day of each month a fee based upon a percentage of the gross revenue derived from charterlairtax! operations as shown in the Fee Schedule. (d) Food & Beverage. Tenant shall pay City on or before the 15`h day of each month a fee based upon a percentage of the gross revenue derived from food and beverage (including alcoholic beverages)sales as shown in the Fee Schedule. (a) General Merchandise. Tenant shall pay City on or before the 151h day of each month a fee based upon a percentage of the gross revenue derived from sales of general merchandise as shown in the Fee Schedule. (f) Landing Fees. Tenant shall pay City on or before the 151h day of each month a landing fee percentage of the gross revenue derived, as indicated in the Fee Schedule, for each one thousand pounds (1,000 lbs.) or portion thereof of the allowable gross weight of Part 121 aircraft operators which shall be paid for each and every transient aircraft being used commercially on either the arriving or departing flight from Palm Springs International Airport, except that this provision shall not apply in the case of aircraft permanently based at this Airport, government and military aircraft, or those aircraft certified by the Federal Aviation Administration or the State of California through its agency(s)to service the Airport on a published schedule basis. City retains the right to adjust landing fees upon sixty (60) days written notice to Tenant. (g) Parking Fees. Tenant shall pay City on or before the 1516 day of each month a parking fee percentage of the gross revenue derived, as indicated in the Fee Schedule, for permanently based aircraft parking at Palm Springs International Airport, except that this provision shall not apply in the case of government and military aircraft, or those aircraft certified by the Federal Aviation Administration or the State of California through its agency(s) to service the Airport,on a published schedule basis. City retains the right to adjust parking fees upon sixty (60) day written notice to Tenant. (h) Customs Fees. Tenant shall pay City on or before the 15th day of each month any and all Customs fees as indicated in the Fee Schedule associated for clearance of international flights arriving at Palm Springs International Airport. 4.9 Late Payment. Tenant hereby acknowledges that late payment by Tenant to City of rental or other sums due hereunder will cause City to incur costs not contemplated by this Lease,the exact amount of which is extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges. Accordingly, any payment of any sum to be paid by Tenant not paid when within five (5) days of its due date shall be subject to a five percent (5%) late charge. City and Tenant agree that this late charge represents a reasonable RV#15925 vl _9_ estimate of such costs and expenses and is fair compensation to City for its loss suffered by such late payment by Tenant. 4.1 D Interest. Any sum to be paid pursuant to the terms of this Lease not paid when due shall bear interest from and after the due date until paid at a rate equal to three percent (3%) over the reference rate being charged by Bank of America, N.A. from time to time during such period so long as the rate does not exceed the maximum non-usurious rate permitted by law In which case interest shall be at the maximum non-usurious rate allowed by law at the time the sum became due. 4.11 Records of Gross Sales and Fees and Charges Due. Tenant shall keep at the Demised Premises (and shall require any permitted subtenant to keep at the Demised Premises) full, complete and proper books, records and accounts of its daily gross sales, both for each and on credit, at any time operated in the Demised Premises. The City and its agents and employees shall have the right at any and all times during regular business hours, to examine and inspect all of the books and records of the Tenant, including any sales tax reports pertaining to the business of the Tenant conducted in, upon, or from the Demised Premises, for the purpose of investigating and verifying the accuracy of any statement of gross sales and fees and charges due the City and to cause an audit of the business of Tenant to be made by a certified public accountant of City's selection; provided City has notified Tenant al least five (5) days prior to such time and such examination, inspection or audit shall not unreasonably interfere with Tenant's business, or use of the Demised Premises. If the statement of gross sales and fees and charges due the City previously made to City shall be found to be inaccurate, then and in that event, there shall be an adjustment and one party shall pay to the other on demand such sums as may be necessary to settle in full the accurate amount of said percentage rental that should have been paid to City for the period or periods covered by such inaccurate statement or statements. If said audit shall disclose an inaccuracy of greater than ten percent(10%) error with respect to the amount of gross sales and fees and charges due the City reported by Tenant for the period of said report, then the Tenant shall immediately pay to City the cost of such audit; otherwise,the cost of such audit shall be paid by City. 4.12 Annual Certified Accounting_Report. Tenant shall submit to City by May 31' of each year a copy of its annual independently audited certified report reflecting all operations at the Airport for the prior calendar year. 5. SECURITY DEPOSIT. 5.1 Security Deposit Requirement and Amount. Tenant shall provide City with a security deposit in the sum of Twenty-Five Thousand Dollars ($25,000.00). City pursuant to this Section 5.1 and Section 5.2 below may draw upon the security deposit. The security deposit shall take one of the forms set out below and shall guarantee Tenant's full and faithful performance of all the terms, covenants, and conditions of this Lease. Nothing contained in this Section 4 shall in any way diminish or be construed as waiving any of the City's other remedies as provided In this Lease, or by law or in equity. City reserves the right to adjust the amount of the security deposit to.reflect changes in operations or changes in rents and fees established by City. Within thirty (30) days after notification of any change in required security deposit amount from City,Tenant shall submit to City any additional security deposit as may be required. 5.2 Use of Security Deposit. Regardless of the form in which Tenant elects to make said security deposit, all or a portion of the principal sum shall be available unconditionally to City for correcting any default or breach of this Lease by Tenant, his successors or assigns, or for RV 415925 v1 _10- l q °� ✓ payment of expenses incurred by City as a result of the failure of Tenant, his successors or assigns, to faithfully perform all terms, covenants, and conditions of this Lease, including, but not limited to, non-payment of any payment obligation of Tenant under Section 3 above. In the event City withdraws any or all of the security deposit as provided herein, Tenant shall, within ten (10) days of any withdrawal by City, replenish the security deposit to maintain it at amounts as herein required throughout the lease term. Failure to do so shall be deemed a default and shall be grounds for immediate termination of this Lease. 5.3 Release of Liability. Should Tenant elect to assign a savings deposit, provide a time certificate of deposit, an instrument of credit, or a faithful performance bond to fulfill, the security deposit requirements of this Lease, said assignment, certificate, bond, or instrument shall have the effect of releasing the depository or creditor therein from liability to Tenant on account of the payment of any or all of the principal sum to City, or order upon demand by City. The agreement entered into by Tenant with a financial institution to establish the deposit necessary to permit assignment or issuance of a certificate as provided above may allow the payment to Tenant or order of interest accruing on account of said deposit. 5.4 Return of Security Deposit. The security deposit shall be returned by City to Tenant at the end of the lease term, provided Tenant has fully and faithfully performed each and every term, covenant, and condition of this Lease. The authorized refund of any security deposit by City, after deduction of all amounts due City under this Lease, shall be made after sixty (60) days have elapsed following the effective date of said termination. 6. USE OF THE PREMISES, 6.1 Permitted Use. The City leases to Tenant and Tenant hires from City the Demised Premises with appurtenances as defined herein, for the purpose of conducting thereon only the uses described in this Section 6.1 and for no other use. Tenant desires to engage in the business of fixed based operation ("Ft3O") services for the Airport and wishes to lease the Demised Premises on a non-exclusive basis for such purposes, which services include maintenance of aircraft and engine parts and accessories, sales of aviation fuels and lubricants, sales of automotive fuels for on-airport uses, air taxi operations, and general aviation and airport facilities operations, as permitted under the Airport Rules and Regulations. Tenant shall further comply with the following obligations with respect to its use of the Demised Premises: (a) Noise Standards. Due to the noise sensitive environment of the Airport, Tenant will shall not schedule maintenance work between the hours of 10:00 pm and 7:00 am, which exceeds the City noise standards, as established under Palm Springs Municipal Code section 6.08.040, as such standards may be duly amended from time-to-time. Tenant agrees to conduct no engine run-ups on the Demised Premises, but may do so at the locations designated in writing by the Airport Director. (b) Reciprocal Access. Tenant shall, at all times during the Term of this Lease, provide reciprocal access easements for use of ramp areas and reciprocal use for all automobile parking facilities with other airport tenants. Tenant will use its best efforts to restrict the use of its automobile parking facilities on the premises to the automobiles of Tenant's and/or sub lessee's guests, visitors, employees and suppliers. 6.2 Compliance with Laws. Tenant shall, at its sole cost and expense, comply with all of the requirements of all municipal, state and federal authorities now in force or which may hereafter be in force pertaining to the use of the Demised Premises, and shall faithfully RV#15925 vl -t 1- observe in said use all municipal ordinances, including, but not limited to, the General Plan, zoning ordinances, state and federal statutes, or other governmental regulations now in force or which shall hereinafter be in force. Tenant's violation of law shall constitute an admission of Tenant in any action or proceeding against Tenant, whether City is a party thereto or not, that Tenant has violated any such order or statute in said use, shall be conclusive of that fact as between the City and Tenant. 6.3 Prohibited Uses. (a) Tenant shall not use, or permit the Demised Premises, or any part thereof, to be used for any purpose or purposes other than the express purpose or purposes for which the Demised Premises are hereby leased pursuant to Section 6.1 above. Tenant shall comply with any and all requirements, pertaining to the use of the Demised Premises, of any insurance organization or company necessary for the maintenance of reasonable fire and public liability insurance, covering the buildings within the Demised Premises and appurtenances. Tenant shall not commit, or suffer to be committed, any waste upon the Demised Premises, or any nuisance or other act or thing, which may disturb the quiet enjoyment of any other tenant or occupant of the Airport. Tenant shall not conduct or permit to be conducted any sale-by-auction in, upon or from the Demised Premises, whether said auction be voluntary, involuntary, pursuant to any assignment for the payment of creditors, or pursuant to any bankruptcy or other solvency proceeding. (b) Tenant shall not engage in any activity on or about the Demised Premises that violates any Environmental Law, and shall promptly, at Tenant's sole cost and expense, take all investigatory and/or remedial action required or ordered by any governmental agency or Environmental Law for clean-up and removal of any contamination involving any Hazardous Material created or caused directly or indirectly by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute, ordinance or regulation pertaining to health, industrial hygiene or the environmental conditions on, under or about the Demised Premises, including, without limitation, (1) the Comprehensive Environmental Response, Compensation and Liability Act of 19BO ("CERCLA"), 42 U.S.C. Sections 9601 et sec.; (11) the Resource Conservation and Recovery, Act of 1976 ("RCRA"), 42 U.S.C. Sections 6901 et sec.; (III) California Health and Safety Code Sections 25100 et sea.; (iv)the Safe Drinking Water and Toxic Enforcement Act of 1986. California Health and Safety Code Section 25249.5 et seq.; (v) California Health and Safety Code Section 25359.7, (vi) California Health and Safety Code Section 25916; (vii) the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 at sec.; (viii) California Water Code Section 1300 at sue.; and (ix) California Civil Code Section 3479 et seg., as such laws are amended and the regulations and administrative codes applicable thereto. The term "Hazardous Material" includes, without limitation, any material or substance which is (1) defined or listed as a "hazardous waste", "extremely hazardous waste", "'restrictive hazardous waste' or "hazardous substance" or considered a waste, condition of pollution or nuisance under the Environmental Laws; (ii) petroleum or a petroleum product or fraction thereof; (iii) asbestos; and/or (iv) substances known by the State of California to cause cancer and/or reproductive toxicity. It is the intent of the parties hereto to construe the terms "Hazardous Materials" and "Environmental Laws" in their broadest sense. Tenant shall provide all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et sec. Tenant shall provide prompt written notice to City of the existence of Hazardous Substances on the Demised Premises and all notices of violation of the Environmental Laws received by Tenant. nv#is9zs -12- 6.4 Non-Discrimination & FAA Required Clauses. (a) Tenant, in the operations to be conducted pursuant to the provisions of this Lease and otherwise in the use or the Airport, shall not discriminate against any person or class of persons by reason of race, color, sex, creed or national origin as in any manner prohibited by Part 15 of the Federal Aviation regulations or any amendments thereto. (b) Tenant shall furnish its accommodations and/or services on a fair, equal and not unjustly discriminatory basis ,to all users thereof. It shall charge fair, equal and not unjustly discriminatory prices for each unit or service; provided, however, that the tenant may be allowed to make reasonable and non-discriminatory discounts, rebates or other similar types of price reductions to volume purchasers in accordance with the other provisions of this Lease with regard to discounts and rebates. (c) Tenant agrees to insert the anti-discrimination provisions hereinabove enumerated in any agreement by which said Tenant grants a right or privilege to any person, firm or corporation to render accommodations and/or services to the public on the Demised Premises. (d) City also reserves the right, but shall not be obligated to Tenant, to maintain and keep in repair the landing area of the Airport, as well as publicly owned facilities of the Airport,together with the right to direct and control the activities of the Tenant in this regard. (e) Tenant hereby agrees to comply with the notification and review requirements covered in Part 77 of the Federal Aviation regulations in the event any future structure or building is planned or in the event of any planned modification or alteration of any present or future building or structure situated on the Demised Premises. (f) City hereby reserves a right of flight for the passage of aircraft in the airspace above the surface of the Demised Premises together with the right to create in said airspace such noise as is or shall become inherent in the operation of aircraft operating on the Airport. (g) Tenant, by accepting the Lease, expressly agrees for itself, its successors and assigns that it shall not erect nor permit the erection of any structure or object nor permit the growth of any tree on the land leased hereunder above the mean sea level elevation of five hundred (600) feet. In such an event, City reserves the right to enter upon the Demised Premises and cause the abatement of the interference or hazard at the expense of the Tenant. (h) Tenant, by accepting this Lease, expressly agrees for itself, its successors and assigns that it shall not use the Demised Premises in any manner which might interfere with the landing and taking off of aircraft from on or off the Airport or otherwise create a hazard. In such an event, City reserves the right to enter upon the Demised Premises and cause the abatement of the interference or hazard at the expense of the Tenant. (i) This agreement and all the provisions hereof shall be subject to whatever right the United States Government now has or in the future may have or acquire affecting the control, operation, regulation or commandeering of the Airport or the exclusive or non-exclusive use of the Airport by the United States during the time of war or national emergency. ,RV#15925 v] -13- �\ Q} Operations for Benefit of Public. Tenant agrees to operate the Demised premises for the use and benefit of the public, to make available all Tenant's airport facilities to the public, other than office or restricted areas without discrimination an the grounds of sex, race, color or national origin and to refrain from imposing or levying excessive discriminatory or otherwise unreasonable charges or fees for any use of its facilities or otherwise unreasonable charges or fees for any use of its facilities for services. Nothing herein contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308 of the Federal Aviation Act of 1958, as amended. Other Tenants or aircraft shall have the right to cross over taxiway/ramp areas of the Leasehold. 6.5 S_ i . Tenant shall not place, or permit to be placed, any sign that is not in compliance with the sign ordinance of the City upon the exterior or in the windows of the Demised Premises. Any sigri not constructed in accordance therewith shall be immediately removed by Tenant and, if said sign is not removed by Tenant within ten (10) days of written notice from City to Tenant, then City may remove said sign without Tenant's approval and without any liability to Tenant. 6.6 Public Facilities Ingress Egress and Quiet Enioyment. City agrees that Tenant, upon payment of the rental hereunder and performing the covenants of this Lease, may quietly have, hold and enjoy the Demised Premises during the term of the Lease, and that Tenant shall have the non-exclusive right to use, in common with others, the public facilities at the Airport and Tenant shall have a reasonable right of ingress to and egress from the Demised Premises and the public facilities for its employees, visitors and customers, expressly including access to runways and taxiways, from the Demised Premises and other public facilities. 6.7 Rules and Regulations. Tenant shall faithfully observe and comply with the rules and regulations that City shall from time to time promulgate and/or modify. City shall have previously provided a copy of any such rules and regulations to Tenant. Any amendment or modification of the Rules and Regulations shall be binding upon the Tenant within a reasonable period following delivery of a copy of such amendment or modification to Tenant. City shall not be responsible to Tenant for the nonperformance of any said rules and regulations by any other tenants or occupants. The Rules and Regulations shall apply and be enforced as to all tenants in the Demised Premises on a uniform basis. 7. ALTERATIONS AND REPAIRS 7.1 Improvements Alterations and Fixtures. Tenant shall not make or suffer to be made, any alterations or improvements to the Demised Premises, or any part thereof, without the prior written consent of City, which consent shall not be unreasonably withheld or delayed, and any alterations or improvements to the Demised Premises, except movable furniture, trade fixtures, equipment, and items of personal property shall become at once a part of the realty and shall at the expiration or earlier termination of this Lease belong to City free and clear of any liens or encumbrances. Tenant shall not in any event make any changes to the exterior of the Demised Premises unless such alterations or improvements are in conformance with the requirements of all municipal, state, federal, and other governmental authorities, including requirements pertaining to the health, welfare or safety of employees of the public and in conformance with reasonable Rules and Regulations of City. Such changes or alterations must be approved in writing by City. City may require that any such alterations or improvements be removed prior to the-expiration of the term hereof provided City has notified Tenant of such requirement at the time alterations or improvements are approved. Any removal of alterations or improvements or furniture and trade fixture shall be at Tenant's expense and accomplished in RV 415925 v1 -14- f a good and workmanlike manner. Any damage occasioned by such removal shall be repaired at Tenant's expense so that the Demised Premises can surrendered in a good, clean and sanitary condition as required by Section 7.2 hereof, reasonable wear and tear excepted. Any and all fixtures, improvements and appurtenances installed by Tenant shall conform with the requirements of all municipal, state, federal, and governmental authorities including requirements pertaining to the health, welfare, or safety of employees orthe public. 7.2 Maintenance and Repair. Tenant shall, subject to City's obligations hereinafter provided, at all times during the term hereof, and at Tenant's sole cost and expense, keep, maintain and repair the Demised Premises and other improvements within the Demised Premises in good and sanitary order, condition, and repair, reasonable wear and tear excepted (except as hereinafter provided) including without limitation, the maintenance and repair of any landscaping and irrigation systems, store fronts, doors, window easements, glazing, heating and air conditioning system, plumbing, pipes, electrical wiring and conduits. Tenant shall also at its sole cost and expense is responsible for any alterations or improvements to the Demised Premises necessitated as a result of the requirement of any municipal, state or federal authority. Tenant hereby waives all right to make repairs at the expense of the State of California. By entering into the Demised Premises, Tenant shall be deemed to have accepted the Demised Premises as being in good and sanitary order, condition and repair, and Tenant agrees on the last day of said term, or sooner Termination of this Lease, to surrender the Demised Premises with appurtenances, in the same condition as when received and in a good, clean and sanitary condition, reasonable use and wear thereof and damage by fire, act of God or by the elements excepted and subject to any alterations or improvements approved by City as provided herein and in accordance with Section 10 below. Tenant shall periodically sweep and clean the sidewalks, ramp areas, parking lots and adjacent pavement areas of the Demised premises, as needed. 7.3 Free From Liens. Tenant shall keep the Demised Premises free from any liens arising out of any work performed, material furnished, or obligation incurred by Tenant or alleged to have been incurred by Tenant. 7.4 Construction Obligations. Tenant agrees to make the improvements ("Tenant's Work,") at its sole cost and expense. Tenant's construction of said improvements shall be in accordance with Section 2 above and Section 7.4. Tenant shall construct all improvements in strict compliance with any plans and specifications approved by the City. Tenant shall be required to incorporate any City-requested changes and comments to any plans and specifications proposed by Tenant. Development of such improvements shall be conducted in a good and workmanlike manner. Tenant shall expend the cost of improvements in the amount and for the parcels as designated below. The term "cost of improvements" shall mean direct construction costs, including costs paid to contractors, architects, engineers, laborers and suppliers, but not indirect costs such as financing costs, administrative and overhead expenses, bond premiums, permit fees, and developer fees paid by Tenant or its affiliates. Tenant shall provide to City records showing the expected cost of improvements, as required under Section 7.6 below. The improvements shall include the following: (a) New Corporate Facility (Parcel 1). Tenant shall construct the New Corporate Facility at Parcel 1 within the times set forth at Section 2 above. Tenant shall expend a minimum of Two Million And 00/100 Dollars ($2,000,000,00) for the cost of improvements in constructing the New Corporate Facility at Parcel 1. RV Ii15925 v1 -15_ a � (� � 'V (b) Executive Hangars (Parcels 3 and 6). Tenant shall construct the Executive Hangars at Parcels 3 and 6 within the times set forth at Section 2 above. Tenant shall implement similar designs and expend minimum costs of improvements in terms of quality and design as those for the current executive hangars existing at Palm Springs International Airport as of the Commencement Date of this Lease. 7.5 Tenant's Assurance of Construction Completion. Prior to commencement of any construction of approved facilities, or any phase thereof, within the Lease Area by Tenant, Tenanf'shall furnish to City evidence that assures City that sufficient monies will be available to complete the proposed construction. The amount of money available shall be at least equal to the total estimated construction cost. Such evidence may take one of the following forms: (a) Completion Bond issued to City as obligee. (b) Irrevocable letter of credit issued to City from a financial institution to be in effect until City acknowledges satisfactory completion of construction (c) Cash. (d) Any combination of the above. A company qualified to do business in the State of California and acceptable to City must issue all bonds and letters of credit. All bonds and letters of credit shall be in a form acceptable to City and shall insure faithful and full-observance and performance by Tenant of all terms, conditions, covenants, and agreements relating to the construction of improvements within Parcel 1. 7.6"As-Built" Plans and Construction Costs. Within thirty (30) days' of City's request, Tenant shall furnish Contract Officer an itemized statement of the actual construction cost of Tenant's improvements to Parcel 1, including supporting invoices signed by subcontractors that performed, or are scheduled to perform such improvements. The statement of cost shall be sworn to and signed by Tenant, or his responsible agent, under penalty of perjury. Tenant must obtain Contract Officer's approval of "As-Built" plans, and the form and content of the itemized statement. In addition, within sixty (60) days following completion of any substantial improvement within the Lease Area, Tenant shall furnish Contract Officer a complete set of reproducible, two sets of prints of "As-Built" plans and a magnetic, tape, disk or other storage media containing the "As-Built" plans in a form usable by City, to City's satisfaction, on City's computer aided mapping and design equipment. 7.7 City's Reserved Riahts. (a) Airport Development and Safety. City reserves the right to further develop or improve the aircraft operating area of the Airport as It sees fit, and City reserves the right to take any action it considers necessary to protect the aerial approaches of the Airport against obstruction, together with the right to prevent Tenant from erecting, or permitting to be erected, any building or other structure of the Demised premises which, in the opinion of City, would limit the usefulness of the Airport or constitute a hazard to aircraft; provided, if such developments or improvements materially impair Tenant's use of the Demised Premises, Tenant can terminate this lease without any further liability there for. RV 915925 A -16- (b) Lease to United States. During the time of war or national emergency, City shall have the right to lease the landing area or any part thereof to the United States Government for military or naval use; and, if such lease is executed, the provisions of the Lease insofar as they are inconsistent with the provisions of the Lease to the Government shall be suspended and, in that event, a just and proportionate part of the rent hereunder shall be abated, and the period of such closure shall be added to the term of this Lease so as to extend and postpone the expiration thereof unless the Tenant otherwise elects to terminate the Lease. B. INSURANCE AND INDEMNIFICATION. 81 Insurance Provided by Tenant. (a) Food Preparation. Tenant, if involved in food preparation and sales as a cafe, restaurant, or similar use, and/or food takeout service, shall install at Tenant's expense, any fire protective systems In grill, deep fry, and cooking areas which are required by city, county, and state fire ordinances, and any such system, when installed, shall qualify for full fire protective credits allowed by the fire insurance rating and regulatory body in whose jurisdiction the Demised Promises are located. (b) Tenant to Provide Personal Property Insurance. Tenant, at its sole expense, shall maintain fire and extended coverage insurance written on a per occurrence basis on its trade fixtures, equipment, personal property and inventory within the Demised Premises from loss or damage to the extent of their full replacement value and shall provide plate glass coverage. (c) Tenant to Provide Liability Insurance. During the entire term of this Lease,the Tenant shall, at the Tenant's sole cost and expense, but for the mutual benefit of City and Tenant, maintain comprehensive general liability insurance insuring against claims for bodily injury, death or property damage occurring in, upon or about the Demised Premises and an any sidewalks directly adjacent to the Demised Premises written on a per occurrence basis in an amount not less than either (i) a combined single limit of FIVE MILLION DOLLARS ($5,000,000.00) for bodily injury, death, and property damage or (ii) bodily injury limits of $1,000,000.00 per person, $2,000,000.00 per occurrence and $2,000,000.00 products and completed operations and property damage limits of $500,000.00 per occurrence and $1,000,000.00 in the aggregate; provided, however, if City so elects City may provide such insurance and, in such event, Tenant agrees to pay its pro-rata share of the cost of said insurance. (d) Tenant to Provide Worker's Compensation Insurance. Tenant shall, at the Tenant's sole cost and expense, maintain a policy of worker's compensation insurance in an amount as will fully comply with the laws of the State of California and which shall indemnify, insure and provide legal defense for both the Tenant and the City against any loss, claim or damage arising from any injuries or occupational diseases occurring to any worker employed by or, any persons retained by the Tenant in the course of conducting Tenant's business in the Demised Premises. (e) General Provisions Applicable to Tenant's Insurance. All of the policies of insurance required to be, procured by Tenant pursuant to this Section 8.1 shall be primary Insurance and shall name the City, its officers, employees and agents as additional insureds. The insureds shall waive all rights of contribution they may have against the City, its officers, employees and agents and their respective Insurers. All of said policies of insurance RV 915925 v1 -17_ shall provide that said insurance may not be amended or canceled without providing 30 days prior written notice by registered mail to, the City. Prior to the Commencement Date or such earlier date as Tenant takes possession of the Demised Premises for any purpose; and at least 30 days prior to the expiration of any insurance policy, Tenant shall provide City with certificates of insurance or appropriate insurance binders evidencing the above insurance coverages written by insurance companies acceptable to City, licensed to do business in the state where the Demised Premises are located and rated A:VII or, better by Best's Insurance Guide. In the event the Risk Manager of City ("Risk Manager") determines that (1) the Tenant's activities in the Demised Premises creates an increased or decreased risk of loss to the City, (ii) greater Insurance coverage is required due to the passage of time, or (!it) changes in the industry require'different coverages be obtained,Tenant agrees that the minimum limits of any insurance policy required to be obtained by Tenant shall be changed accordingly upon receipt of written notice from the Risk Manager; provided that Tenant shall have the right to appeal a determination of increased coverage by the Risk Manager to the City Council of City within ten (1 D) days of receipt of notice from the Risk Manager. City and Tenant hereby waive any rights each may have against the other on account of any loss or damage occasioned by property damage to the Demised Premises, its contents, or Tenant's trade fixtures, equipment, personal property or inventory arising from any risk generally covered by insurance against the perils of fire, extended coverage, vandalism, malicious mischief, theft, sprinkler damage, and earthquake sprinkler leakage. Each of the parties, on behalf of their respective insurance companies insuring such property of either City or Tenant against such loss, waive any right of subrogation that it may have against the other. The foregoing waivers of subrogation shall be operative only so long as available in California and provided further that no policy is invalidated thereby. 8.2 Tenant to Provide Fire and Extended Coverage Insurance. Tenant, at its sole expense, shall maintain fire and extended coverage insurance throughout the term of this Lease written on a per-occurrence basis on the Demised Premises, its trade fixtures, equipment, personal property and inventory within the Demised Premises from loss or damage to the extent of the full replacement value. 8.3 Indemnification of City. Tenant, as a material part of the consideration to be rendered to City under this Lease, hereby waives all claims against City for damage to equipment or other personal property, trade fixtures, leasehold improvements, goods, wares, inventory, and merchandise, in, upon or about the Demised Premises and for injuries to persons In or about the Demised Promises, from any cause arising at any time, other than claims and injuries caused by the gross negligence or willful misconduct of City or its agents, employees or invitees. Tenant agrees to indemnify the City, its officers, agents and employees against, and will hold and save each of them harmless from, any and all actions, suits, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities, (herein "claims or liabilities:")that may be asserted or claimed by any person, firm or entity arising out of or in connection with (i) the negligent performance of the work, operations or activities of Tenant, its agents, employees, subcontractors, or invitees, Provided for herein, or (ii) arising from the use of the Demised Premises or the parking and commori areas by Tenant or its employees and customers, or (it!) arising from the failure of Tenant to keep the Demised Premises in good condition and repair, as herein provided, or(iv) arising from the negligent acts or omissions of Tenant hereunder, or (v) arising from Tenant's negligent performance of or failure to perform any term, provision covenant or condition of this Lease, but excluding such claims or liabilities arising from the sole negligence or willful misconduct of the City, its officers, agents or employees, who are directly responsible to the City, and in connection therewith: RVW15925 VI _18_ Ca 4 (a) Tenant will defend any action or actions filed in connection with any of said claims or liabilities and will pay all costs and expenses, including legal costs and attorneys' fees incurred in connection therewith; (b) Tenant will promptly pay any judgment rendered against the City, its officers,agents or employees for any such claims or liabilities arising out of or in connection with the negligent performance of or failure to perform such work, operations or activities of Tenant hereunder, other than claims and injuries, caused by the gross negligence or willful misconduct of City or its agents, employees or invitees; and Tenant agrees to save and hold the City, its officers,agents, and employees harmless there from, (c) In the event The City, its officers, agents or employees is made a party to any action or proceeding filed or prosecuted against Tenant for such damages or other claims arising out of or in connection with the negligent performance of, or failure to perform the work, operation or activities of Tenant hereunder, other than claims and injuries caused by the gross negligence, or willful misconduct of City or its agents, employees or invitees, Tenant agrees to pay to the City, Its officers, agents or employees, any and all costs and expenses incurred by the City, its officers, agents or employees in such action or proceeding, including but not limited to, reasonable legal costs and attorneys'fees. 9. ABANDONMENT AND SURRENDER. 9.1 Abandonment. Tenant shall not vacate or abandon the Demised Premises at any time during the term of this Lease; and if Tenant shall abandon, vacate or surrender the Demised Premises or be dispossessed by process of law, or otherwise, any personal property belonging to Tenant and left on the Demised Premises shall be deemed to be abandoned, at the option of City, except such property.as may be mortgaged to City. 9.2 Surrender of Lease. Except where City expressly consents to a sublease by executing a Non-Disturbance Agreement in the form set forth at Exhibit"F" hereto, the voluntary or other surrender of this Lease by Tenant, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of City, terminate all or any existing subleases or subtenancies, or may, at,the option of City, operate as an assignment to it of any or all of such subleases or subtenancies. 10.DAMAGE AND DESTRUCTION OF PREMISES. In the event of (a) partial or total destruction of the Demised Premises during the term of this Lease which requires repairs to the Demised Promises, or (b) the Demised Premises being declared unsafe or unfit for occupancy by any authorized public authority for any reason, which declaration requires repairs to the Demised Premises, Tenant shall forthwith make said repairs. No such damage or destruction (including any destruction necessary in order to make repairs required by any declaration made by any public authority) shall in any way annul or void this Lease. Tenant shall promptly clean and remove all debris resulting from said damage or destruction. Tenant shall take preliminary steps toward restoring the improvements within thirty (30) days of the casualty and such improvements shall be restored within a reasonable time thereafter. The Demised Premises shall be restored to the condition they existed immediately before said casualty. Notwithstanding the foregoing In the event of total destruction of the Demised Promised (in Tenant's sole opinion),Tenant shall have the right to terminate this lease without any further liability there for. RV#15925 v1 -19- S 11.ASSIGNMENT AND SUBLETTING, Tenant shall not assign this Lease or sublet the Demised Premises, or'any interest therein, without the prior written consent of City, which consent shall not be unreasonably withheld. Tenant may assign this Lease or sublet the Demised Premises to any affiliate, parent or subsidiary of Tenant with prior written notification to City and provision of a copy the assumption and assignment agreement. For purposes of this Lease, an assignment shall be deemed to include the transfer to any person or group of persons acting in concert of more than twenty five percent (25%) of the present ownership and/or control of Tenant, taking all transfers into account on a cumulative basis. Any such assignment or subletting shall be subject to all of the terms and conditions of this Lease and proposed; assignee shall assume the obligations of Tenant under this Lease in writing in a form satisfactory to City. The proposed assignee shall simultaneously provide to City an estoppel certificate in the form described in Section 15.2 hereafter. Consent by City to one assignment, subletting, occupation or use by another person shall not be deemed to be consent to any subsequent assignment, subletting, occupation or use by another person. Any assignment or subletting without the prior written consent of City shall be void, shall constitute a material breach of this Lease, and shall, at the option of City, terminate this Lease. Neither this Lease nor any interest therein shall be assignable as to the interest of Tenant by operation of law. City shall be under no obligation to consider a request for City's consent to an assignment until Tenant shall have Submitted in writing to City a request for City's consent to such assignment together with audited financial statements of the proposed assignee, a history of the proposed assignee's business experience and such other information as required by City the criteria for assignment as set forth herein are met. In information as required by City the criteria for assignment as set forth herein are met. In addition, if City determines that the Monthly Rent payable to City under this Lease is less than the fair market rental value, as determined by City, City shall have the right to condition its approval to an assignment or subletting on the increase of Monthly Rent to the fair market rental value. Notwithstanding the above, City's consent shall not be required for tenant's leasing of individual aircraft hangar spaces or aircraft parking spaces under this lease. Tenant shall nevertheless provide City with copies of all leases for hangar space and aircraft parking space. 12. ENCUMBRANCE. 12.1 This Lease, or any right to or interest in, or any of the improvements on the Demised premises, may be encumbered with the written approval of City, which shall not be unreasonably withheld. No such encumbrance or addition thereto or extension thereof shall be valid without said approval. Any such approved encumbrance shall be Subject to the covenants, conditions and restrictions set forth herein and to all rights of City. 12.2 Any encumbrance must be confined to the leasehold interest of Tenant or the sub-leasehold interest of a subtenant, and shall not affect in any way the landlord's interest in the land. The encumbrance shall provide that the proceeds from fire or extended coverage insurance shall be used for the repair or rebuilding of the leasehold improvements and riot to repay any part of the outstanding mortgage. Tenant agrees to furnish, as requested, any financial statements or analysis pertinent to the encumbrance that City may deem necessary to justify the amount, purpose and terms of said encumbrance. RV A15925 vt -20- 12.3 In the event of default by the Tenant of the terms of an approved encumbrance, the encumbrancer may exercise any rights provided in such approved encumbrance provided that, before any sale of the leasehold estate, whether by power of sale, or foreclosure, the encumbrancer shall give to City notice of the same character as is required to be given to Tenant by such encumbrancer pursuant to the loan documents and/or the laws of the State of California and City shall be given an additional thirty (30) days in which to cure the default after the time for tenant to cure has expired. 12A If any sale under the approved encumbrance occurs, whether by power of sale or foreclosure, and the purchaser at such sale is the encumbrancer, the encumbrancer may sell and assign the Lease without any further consent of City provided that The assignee shall agree in such assumption by the assignee, the encumbrancer shall be released from all future obligations of the Tenant under the Lease. If a sale under the approved encumbrance occurs, and the purchaser is a party other than the encumbrancer, said purchaser, as successor in interest to the Tenant, shall be bound by all the terms and conditions of the Lease and the purchaser shall assume in writing the obligations of Tenant hereunder. 12.5. If notice of such sale shall be given and the defaults or any of them upon which such notice of sale is based shall then continue, City shall have the right to correct such defaults at any time prior to the date of sale or foreclosure, and to terminate such leasehold upon paying to the encumbrancer the balance of the encumbrance as hereinafter defined. 12.6 "Balance of encumbrance" shall mean the amount of principal remaining unpaid on a note secured by a trust deed or mortgage of an plus accrued and past due interest thereon and expenses incurred by the lender in connection with foreclosure including by not limited to, fire Insurance premiums, title insurance expenses, recording fees, appraisal fees, credit reports and any tax reporting services and additional expenditures paid by the lender on additions, betterments and rehabilitations of improvements on the property encumbered pursuant to plans approved by landlord, which consent may not be unreasonably withheld, and other expenses necessary to place the improvements in marketable condition, such adjusted principal to be paid or, at the option of City, amortized over the term and in accordance with the schedule set forth in said note, the interest rate on the unpaid balance thereto to be as set forth in said note. 12.7 City agrees to provide encumbrancer written notice of any default by Tenant under this lease and an opportunity to cure at the time notice of such default is provided to Tenant and give encumbrancer thirty (30) days to cure a monetary default or forty days, encumbrancer shall have a reasonable time to cure such default provided that encumbrancer commences to cure within said forty-five days and diligently prosecutes the cure to completion. Such period of time shall include the time to complete a foreclosure action if encumbrancer needs to gain possession of the Demise Premises to cure said default by Tenant. 13.DEFAULT AND REMEDIES. 13.1 Default by Tenant. In addition to the defaults described in Section 12 hereinabove,the occurrence of any one or more of the following events shall constitute a default and breach of this Lease by Tenant; (a) the failure to pay any rental or other payment required hereunder to, or on behalf of, City more than five (5) days after written notice from City to Tenant that Tenant has failed to pay rent when due; (b) the failure to perform any of Tenant's agreements or obligations hereunder (exclusive of a default in the payment of money) where such default shall continue for a period of thirty(30) days after written notice thereof from City to RV 415925 v1le-21- qCO - Tenant which notice shall be deemed to be the statutory notice so long as such notice complies with statutory requirements, or in the event such failure cannot be cured within such 30 day period, Tenant has not commenced curative measures within such period and Tenant is not diligently pursuing same; (c) the vacation or abandonment of the Demised Promises by Tenant; (d) the making by Tenant of a general assignment for the benefit of creditors; (a) the filing by Tenant of a voluntary petition in bankruptcy or the adjudication of Tenant as a bankrupt; (f) the appointment of a receiver to take possession of all or substantially all the assets of Tenant located at the Demised Premises or of Tenant's leasehold interest in the Demised Premises; (g) the filing by any creditor of Tenant of an involuntary petition in bankruptcy which Is not dismissed within sixty (60) days after filing; or (h) the attachment, execution or other judicial seizure of all, or substantially all, of the assets of Tenant or Tenant's leasehold where such an attachment, execution or seizure Is not discharged within sixty (60) days. Any repetitive failure . by Tenant to perform its agreements and obligations hereunder, though intermittently cured, shall be deemed an incurable default. Two (2) breaches of the same Covenant within a sixty (60) day period, a notice having been given pursuant to (a) or (b) above for the first breach, or three (3) of the same or different breaches at any time during the term of this Lease for which notices pursuant to (a) or (b) above were given for the first two (2) breaches shall conclusively be deemed to be an incurable repetitive failure by Tenant to perform its obligations hereunder. In the event of any such default or breach by Tenant, City may at any time thereafter, without further notice or demand, rectify or cure such default, and any sums expended by City for such purposes shall be paid by Tenant to City upon demand and as additional rental hereunder. In the event of any such default or breach by Tenant, City shall have the right (i) to continue the lease in full force and effect and enforce all of its rights and remedies under this Lease, including the right to recover Tenant's non-payment of any financial obligation of Tenant hereunder as it becomes due under this Lease, (ii) to draw from the security deposit amounts sufficient to reimburse City's actual costs, including attorneys' fees, which City reasonably incurs as a result of Tenant's breach, or to reimburse City for Tenant's non-payment of any financial obligation of Tenant hereunder; or (III) at any time thereafter to elect to terminate the Lease and Tenant's right to possession there under. Upon such termination, City shall have the right to recover from Tenant: (a) The worth at the time of award of the unpaid rental which had been earned at the time of termination; (b) The worth at the time of award of the amount by which the unpaid rental which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided; (c) The worth at the time of award of the amount by which the unpaid rental for the balance of the term after the time of award exceeds the amount of such rental loss that the Tenant proves could be reasonably avoided; and (d) Any other amount necessary to compensate the City for all the detriment proximately caused by Tenant's failure to perform its obligations under the lease or which, In the ordinary course of things,would be likely to result there from. The "worth at the time of award" of the amounts referred to in subparagraphs (i) and (ii) above shall be computed by allowing interest at three percent (3%) over the prime rate then being charged by Bank of America, N.A. but in no event greater than the maximum rate permitted by law. The worth at the time of award of the amount referred to in subparagraph (iii) AV#15925 V1 -22- r above shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of'award plus one percent (1%), but in no event greater than ten percent(10%). As used herein, "rental"shall include the Monthly Rental, percentage rental equal to the average percentage rental paid or payable by Tenant for the last twelve (12) months or such lesser period as Tenant has been open for business, other sums payable hereunder which are designated"rental"or"additional rental"and any other sums payable hereunder on a regular basis such as reimbursement for real estate taxes, Such efforts as City may make to mitigate the damages caused by Tenant's breach of this Lease shall not constitute a waiver of City's right,to recover damages against Tenant hereunder, nor shall anything herein contained affect City's right to indemnification against Tenant for any liability arising prior to the termination of this Lease for personal injuries or property damage, and Tenant hereby agrees to indemnify and hold City harmless from any such injuries and damages, including all attorney's fees and costs incurred by City in defending any action brought against City for any recovery thereof, and in enforcing the terms and provisions of this indemnification against Tenant. Notwithstanding any of the foregoing, the breach of this Lease by Tenant, or an abandonment of the Demised Premises by Tenant, shall not constitute a termination of this Lease, or of Tenant's right of possession hereunder, unless and until City elects to do so, and until such time City shall have the right to enforce all of its rights and remedies under this Lease, including the right to recover rent, and all other payments to be made by Tenant hereunder, as they become due. 'Failure of City to terminate this Lease shall not prevent City from later terminating this Lease or constitute a waiver of City's right to do so. 13.2 No Waiver. Acceptance of rental hereunder shall not be deemed a waiver of any default or a waiver of any of City's remedies. 13.3 City's Default. City shall not be in default unless City fails to perform obligations required of City within a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to City and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein City has failed to perform such obligation; provided, however, that if the nature of City's obligation is such that more than thirty (30) days are required for performance then City shall not be deemed In default if City commences performance within a (30) day period and thereafter diligently prosecutes the same to completion. In no event shall Tenant have the right to terminate this Lease as a result of City's default and Tenant's remedies shall be limited to damages and/or an injunction. 14.CONDEMNATION. In the event a condemnation or a transfer in lieu thereof results in a taking of any portion of the Demised Premises, City may, or in the event a condemnation or a transfer in lieu thereof results in a taking of ten percent (10%) or more of the Demised Premises, Tenant may, upon written notice given within thirty (30) days after such taking or transfer in lieu thereof, terminate this Lease. Tenant shall not be entitled to share in any portion of the award and Tenant hereby expressly waives any right or claim to any part thereof. Tenant shall, however, have the right to claim and recover, only from the condemning authority (but not from City), any amounts necessary to reimburse Tenant for the cost of removing stock and fixtures. If this RV A15925 v1 -23- Lease is not terminated as above provided, City shall use a portion of the condemnation award to restore the Demised Premises, 15. MISCELLANEOUS. 15.1 Entry and Inspection, Tenant shall permit City and his agents to enter into and upon the Demised Premises at all reasonable times following prior notice by City (except in emergencies) for the purpose of inspecting the same or for the purpose of maintaining the Demised Premises as required by the terms of this Lease or for the purpose of posting notices of non-liability for alterations, additions or repairs, or for the purpose of placing upon the property in which the Demised Premises are located any usual or ordinary "For Sale" signs or any signs for public safety as determined by City. City shall be permitted to do any of the above without any rebate of rent and without any liability to Tenant for any loss of occupation or quiet enjoyment of the Demised Premises thereby occasioned. Tenant shall permit City, at any time within six (6) months prior to the expiration of this Lease, to place upon the Demised Premises any usual or ordinary "For Lease" signs, and during such six (6) month period City or his agents may, during normal business hours, enter upon said Demised Premises and exhibit same to prospective tenants. 15.2 Estoppel Certificate, If, as a result of a proposed sale, assignment, or hypothecation of the Demised Premises or the land there under by City, or at any other time, an estoppel certificate shall be requested of Tenant,Tenant agrees, within ten (10) days thereafter, to deliver such estoppel certificate in the form attached hereto as Exhibit "E' addressed to any existing or proposed mortgagee or proposed purchaser, and to the City provided, and only to the extent, the statements in such letter are accurate at such time. Tenant shall be liable for any loss or liability resulting from any incorrect information certified, and such mortgagee and purchaser shall have the right to rely an such estoppel certificate and financial statement. 15.3 Jurisdiction and Venue. The parties hereto agree that the State of California is the proper jurisdiction for litigation of any matters relating to this Lease. and service mailed to the address of tenants set forth herein shall be adequate service for such litigation. The parties further agree that Riverside County, California is the proper place of venue as to any such litigation and Tenant agrees to submit to the personal jurisdiction of such court in the event of such litigation. 15.4 Partial Invalidity. If any term, covenant, condition or provision of this Lease is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the provisions hereof shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereof. 15.5 Successors in Interest. The covenants herein contained shall,'subject to the provisions as to assignment, apply to and bind the heirs, successors, executors, administrators and assigns of all the parties hereto; and all of the parties hereto shall be jointly and severally liable hereunder, 15.6 No Oral Agreements. This Lease (i) covers in full each and every agreement of every kind or nature whatsoever between the parties hereto concerning this Lease, (ii) supersedes any and all previous obligations, agreements and understandings, if any, between the parties, oral or written, and (ill) merges all preliminary negotiations and agreements of whatsoever kind or nature herein. Tenant acknowledges that City or its agents or RV#15925 vl -24- representatives have made no representations or warranties of any kind or nature not specifically set forth herein. 15.7 Authority. In the event that either party is a corporation or a partnership, each individual executing this Lease on behalf of said corporation or said partnership, as the case may be, represents and warrants that he or she is duly authorized to execute and deliver this Lease on behalf of said corporation or partnership, in accordance with a duly adopted resolution of the Board of Directors, if a corporation, or in accordance with the Partnership Agreement, if a partnership, and that this Lease is binding upon said corporation or partnership in accordance with its terms. Each party represents and warrants to the other that the entering into this Lease does not violate any provisions of any other agreement to which such party is bound. 15.8 Relationship of Parties. The relationship of the parties hereto is that of City and Tenant, and it is expressly understood and agreed that City does not in any way, or for any purpose, become a partner of Tenant in the conduct of Tenant's business or otherwise, or a joint venturer with Tenant, and that the provisions of this Lease and the agreements relating to rent payable hereunder are included solely for The purpose of providing a method whereby rental payments are to be measured and ascertained. 15.9 Nondiscrimination. Tenant herein covenants by and for itself, its heirs, executors, administrators and assigns and all persons claiming under or through it, and this Lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons on account of race, sex, marital status, color, creed, national origin or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Demised Premises herein leased, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the Demised Premises. 15.10 Notice. Either party may change the address set forth herein by written notice by certified mail to the other. Any notice or demand given by certified mail shall be effective one (1) day subsequent to mailing. Wherever in this Lease it shall be required or permitted that notice and demand be given or served by either party to this Lease to or on the other, such notice or demand shall be given or served in writing and shall not be deemed to have been duly given or served unless in writing, and personally served or forwarded by certified mail, postage prepaid, addressed as follows: To City: Palm Springs International Airport, 3400 East Tahquitz-Canyon Way, Suite OFC, Palm Springs, California, 92263, Attn: Director of Aviation Facsimile: (760) 318-3815 To Tenant: Signature Flight Support Corporation Attn: Director of Contracts 201 South Orange Avenue, Suite 10D Orlando, Florida 32B01 Facsimile: (407) 646-7352 RV 1F15925 vt -25- (� With a copy to: Signature Flight Support Corporation Attn: General Manager Palm Springs International Airport 210 North El Cielo Road Palm Springs, California 92262 Facsimile: (760) 327-6509 15.11 Waiver. No delay or omission in the exercise of any right or remedy by a non-defaulting party shall impair such right or remedy or be construed as a waiver. A party's consent to or approval of any act by the other party requiring the party's consent or approval shall not be deemed to waive or render unnecessary the other party's consent to or approval of any subsequent act. Any waiver by either party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Lease. 15.12 Exhibits and Addenda. The Exhibits and Addenda attached to this Lease are made a part hereof as if fully set forth herein. in the event of a conflict between the terms and provisions of an Addendum and the terms and provisions of this Lease, the terms and provisions of the Addenda shall prevail. 15.13 At Expiration of Termination of Lease. Upon the expiration or sooner termination of this Lease, Tenant shall promptly deliver to City a quit claim deed conveying its interest in the Demised Premises to City. xvpis9zsvi -26- g IN WITNESS WHEREOF, the parties have executed and entered into this Lease as of the date first written above. CITY OF PALM SPRINGS ATTEST: A municipal corporation By: By: City Clerk City Manager APPROVED AS TO FORM: By: City Attorney TENANT: SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation Corporations require two notarized signatures: One from each of the following: A. Chairman of Board,President,or any Vice President:AND B.secretary,Assistant Secretary,Treasurer,Assistant Treasurer,or Chief Financial Officer). By: By: Signature (notarized) Signature (notarized) Name: Name: Title: Title: State of State of County of as County of ss On ,before me, On ,before me, personally appeared personally appeared personally known to personally known to me (or proved to me on the basis of satisfactory me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) islare evidence) to be the person(s) whose name(s) is/are subscribed to the within Instrument and acknowledged subscribed to the within instrument and acknowledged to me that he/she/they executed the same in to me that he/she/they executed the same in his/hedtheir authorized capacity(ies), and, that by his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the his/her/their. signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s), or the entity upon behalf of which the person(s)acted,executed the instrument. person(s)acted,executed the instrument. WITNESS my hand and official seal. WITNESS my hand and official seal. Notary Notary Signature: Signature:,,_ Notary Seal: Notary Seal: RV 415925 v1 _27_ A-CeC> I 1 .EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 1 That portion of the Northeast 114 of Section 18, Township 4 South, Range 5 East, San Bernardino Base and Meridian, In the City of Palm Springs, County of Riverside, State of California, Being more particularly described as follows: Commencing at the East 114 Comer of said Section 18; Thence North 00°05' 30" East, along the Westerly line of said Section 18 a distance of 740.93 feet; Thence South 69"40'10" East a distance of 44 feet to the TRU E PO INT O F BEGINNING; Thence North 00005'30" East a distance of 568.88 feet; Thence South 89055'10" East a distance of 319.94 feet; Thence South 00"05'30"West a distance of 570.28 feet; Thence North 89'40'10" West distance of319.97 feet to the TRUE POINT OF BEGINNING; conta ining 4.18 acres, m ore or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 2 That portion of the Northeast 114 of Section 18, Township 4 South, Range 5 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of California, B eing m ore particularly described as follows: Commencing at the East 1/4 Comer of said Section 18; Thence North 00005' 30" East, along the Westerly line of said Section 18 a distance of 740.93 feet; Thence South 89040'10" East a distance of 363.97 feetto the TRU E POINT OF BEGINNING; Thence North 00005'30" East a distance of 1020.47 feet; Thence South 89°55'10" East a distance of 200 feet; Thence South 00005'30" West a distance of 1021.35 feet; Thence North 89°40'10" West distance of200 feet to the TRUE POINT OF BEGINNING; containing 4.69 acres, m ore or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE PLIGHT SUPPORT LEAS E PARCEL NO. 3 That portion of the Northeast 114 of Section 18, Township 4 South, Range 5 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of. California, Being more particularly described as follows: Commencing at the East 1/4 Comer of said Section 18; Thence North 00'05' 30" East, along the Westerly line of said Section 18 a distance of 1,619.81 feetto the TRUE POINT OF BEGINNING; Thence continuing North 0005'30" East a distance of 305 feet; Thence South 89055'10" East a distance of 228.86 feet; Thence South D°05'30"West a distance of 305 feet; Thence North 89"55'10" Waste distance of228.86 feet to the TRUE POINT OF BEGINNING; containing 1.60 acres, more or less. EXHIBIT"A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 4 That portion of the Northeast 1/4 of Section 18, Township 4 South, Range 4 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of California, B sing m ore particularly described as follows: Com men cing at the East 1/4 Com er of said Section 18; Thence North 00°05' 30" East, along the Westerly line of said Section 18, a distance of 740.93 feet; Thence South 89040'10" East a distance of 563.89 feet to the TRU E POINT OF BEGINNING; Thence North 00°05' 30" East a distance of 471.35 feet; Thence South 89°55'10" East a distance of 355 feet; Thence South 00°05'30" West a d istance of 472.89 feet; Thence North 89°40'10" West, a distance of 355 feet to the TRUE POINT OF BEGINNING, containing 3.85 acres, more orless. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 6 That portion of the Northeast 114 of Section 18, Township 4 South, Range 4 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of California, Being more particularly described asfollows: Commencing at the East 114 Comer of said Section 1B; Thence North 00005' 30" East, along the Easterly line of said Section 18 a distance of 1,619.81 feet; Thence South 89°55'10" East a distance of 228.86 feetto the TRUE POINT OF BEGINNING; Thence North 00°05' 30" East a distance of 305 feet; Thence South 89°55'10"East a distance of 135 feet; Thence South 00'04'50"West a distance of 305 feet; Thence North 89°55'10" West, a distance of 135 feet to the TRUE POINT OF BEGINNING, containing 0.95 acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 7 A portion of Lots 1 and 2 in Section 13 of Palm Valley Colony Lands, as shown by map on file in Bool< 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California; described as follows: Commencing at the northeast corner of Lot 1 of said Palm Valley Colony Lands, being the northeastcorner of Section 13,Township 4 South, Range 4 East, San Bernardino Meridian; Thence South 89027'20" West, a distance of 1237.82 feet along the North line of said Section 13: Thence South 00°40'40" East, a distance of 654.99 feet; Thence North 89°53'08" East, a distance of 98.00 feet to the point of beginning. Thence North 89°53'08"East, a distance of 502.00 feet; Thence South 00°40'40" East, a distance of 319.92 feet; Thence South 89°53'08"West, a distance of 502.00 feet; Thence North 00°40'40"West, a distance of 319.92 feet to the pointof beginning. Contains 3.69 Acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 8 That portion of the Northeast 114 of Section 13, Township 4 South, Range 4 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of California, Being more particularly described as follows: Commencing at the East 1/4 Comer of said Section 13; Thence North 00°05' 30" East, along the Easterly line of said Section 13 a distance of 1,567 feet, said point also being the TRUE POINT OF BEGINNING; Thence North 88°57'20"West a distance of 327 feet; . Thence North 00005'30"East a distance of 376.35 feet; Thence South 88°57'20" East a distance of 327 feet; Thence South 00°05' 30" West a distance of 376.35 feet to the TRUE POINT OF BEGINNING, containing 2.83 acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 9 A portion of Lots 2 and 3 in Section 13 of Palm Valley Colony Lands, as shown by map on file in Book 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of Calffornia;'descdbed as follows: Commencing at the northeast corner of Lot 1 of said Palm Valley Colony Lands, being the northeastcorner of Section 13,Township 4 South, Range 4 East, San Bernardino Meridan; Thence South 89°27'20" West, a distance of 1237.82 feet along the North line of said Section 13; Thence South 00"40'40" East, a distance of 414.00 feet to the point of beginning; Thence South 00°40'40"East, a distance of 368.00 feet: Thence South 89027'20" West, a distance of 230.07 feet to a point in the East line of Civic Drive, 50.00 feet in width; Thence North 00'11'44"West, a distance of 368.01 feet; Thence North 89°27'20" East, a distance of 226.97 feet to the point of beginning. Contains 1 .93 Acres, m ore or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO, 10 A portion of Lots 2 and 3 in Section 13 of Palm Valley Colony Lands, as shown by map on file in Book 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California; described as follows: Commencing at the northeast corner of Lot 1 of said Palm Valley Colony Lands, being the northeastcorner of Section 13,Township 4 South, Range 4 East, San Bernardino Meriden; Thence South 89027'20" West, a distance of 1237.82 feet along the North line of said Section 13; Thence South 00040'40"East, a distance of 318.00 feet'to the point of beginning. Thence South 00"40'40" East, a distance of 96.00 feet; Thence South 89°27'20" West, a distance of 226.97 feet to a point in the East line of Civic Drive, 50.00 feet In width; Thence North 00°11'44" West, a distance of96.00 feet; Thence North 89027'20" East, a distance of 226.16 feet to the point of beginning. Contains 0.499 Acres, more or less. EXHIBIT"A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 11 A portion of Lot 2 in Section 13 of Palm Valley Colony Lands, as shown by map on file in Book 14, Page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California, being more particularly described as follows: Commencing at the Northeast corner of Lot 1 of said Palm Valley Colony Lands, being the Northeast corner of Section 13, Township 4 South, Range 4 E##ast, San Bernardino Meridian, thence South 89"2720"West, a distance of 1,237.82 feet along the North line of said Section 13, thence South 00040'40"East,a distance of 654.99 feet to the TRUE POINT OF BEGINNING, thence South DO°40'40" East, a distance of 320.58 feet, thence North 89029'52" East,a distance of 98.00 feet, thence North 00"40'4D"West, a distance of 319.92 feet, thence South 89053'08" West, a distance of 98.00 feet to the TRUE POINT OF BEGINNING. _ Containing 0.7212 acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO, 12 (TAXIWAY'G') A portion of Lot 2 in Section 13 of Palm Valley Colony Lands, as shown by map on file in Book 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California; described as follows: Commencing at the northeast corner of Lot 1 of said Palm Valley Colony Lands, being the northeast corner of Section 13,Township 4 South, Range 4 East, San Bernardino Meridian; Thence South 89°27'20" West, a distance of 1237.82 feet along the North line of said Section 13; Thence South 00040'40"East, a distance of 604.99 feet to the point of beginning. Thence South 00040'40" East, a distance of 50.00 feet; Thence North 89°53'08" East, a distance of 170.00 feet; Thence North 00°06'52" West, a distance of 50.00 feet; Thence South 89°53'08"West, a distance of 170.49 feetto the point of beginning. Contains 0.195 Acres, more or less. ' 6010 EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 13 A portion of Lot2 in Section 13 of Palm ValleyCDlony Lands,as shown by map on file in Book 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California; described as follows: Commencing at the northeast comer of Lot 1 of said Palm Valley Colony Lands, being the northeastcorner of Section 13,Township 4 South, Range 4 East, San Bernardino Meridian; Thence South 89"27'20" West, a distance of 1237.82 feet along the North line of said Section 13; Thence South 00°40'40" East, a distance of 357.98 feet to the point of beginning, Thence South 00°40'40" East, a distance of 247.01 feet; Thence North 89°53'08" East, a distance of 427.00 feet; Thence North OO°06'52"West, a distance of 247.00 feet; Thence South 89°53'08" West, a distance of 429.43 feet to the point of beginning. Contains 2.43 Acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 14 A portion of Lots 2 and 3 in Section 13 of Palm Valley Colony Lands, as shown by map on file In Bool( 14, page 652 of Maps, Records of San Diego County, California, in the City of Palm Springs, County of Riverside, State of California; described as follows: Commencing at the Northeast corner of Lot 1 of said Palm Valley Colony Lands, being the northeast corner of Section 13,Township 4 South, Range 4 East, San Bernardino Meridian; Thence South 89°27'20 West, a distance of 1237.82 feet along the North line of said Section 13: Thence South 00040'40" East, a distance of 782 feet to the point of beginning; Thence South 00°40'40" East, a distance of 193.57 feet; Thence South B9029'52" East, a distance of 231.70 feet to a point in the East line of Civic Drive, 50.00 feet in width; Thence North 00'11'44"West, a distance of 193.41 feet; Thence North 89°27'20"West, a distance of 502.D0 feet; Thence North 00°40'40" East, a distance of 230.07 feet to the point of beginning. Contains 1.03 Acres, more or less. EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT EXTANSION PARCEL A portion ofAPN 677-270-022 and Portions of APN 677-260-012,017, 018 &023. Commencing at the Southwest comer of Crone Autry Trail and Tachevah Drive, Palm Springs, California; Parcel size 21.32 acres(928,521 square feet) Legal Description APN 677-260-022, 9.65 AC M/L in POR S W'/of SEC 7 T4S R5E;APN 677- 260-012;4.30 AC M/L in POR S W'/a SEC 7 T4S R5E;APN 6777260-01; 1.25 AC M/L in POR SW 114 SEC 7 T48 R5E;APN 677-260-018;65.47 AC M/L in POR SW'/ SEC 7 T4S R5$;APN 677- 260-023; 8.85 AC MI in POR SW'/,SEC 7 T4S R5E L� EXHIBIT "A" PALM SPRINGS INTERNATIONAL AIRPORT SIGNATURE FLIGHT SUPPORT LEASE PARCEL NO. 01-2 That portion of the Northeast 1/4 of Section 13, Township 4 South, Range 4 East, San Bernardino Base and Meridian, in the City of Palm Springs, County of Riverside, State of California, Being more particularly described as follows: Commencing at the Northeast Corner of said Section 13, thence along the Northerly line of Section 13, South 89°48'00"West a distance of 1,470.10 feet; Thence South 00°06'44" West, a distance of393.58 feet; Thence North 89°48'00" East a distance of 25 feet to a point on the Easterly Right-of-Way of Civic Drive, said point also being the TRUE POINT OF BEGINNING; Thence North 00°06'44" East a distance of 333.69 feet to the beginning of a non-tangent curve having a radius of 20 feet, a radial bearing passing through said point bears South 89°53'16" East; Thence Northeasterly along the arc of said curve through a central angle of 89°41'16" a distance of 31.31 feet to a point lying 40 feet South of the North line of said Section 13, when measured at right angles; Thence North 89°48'DO" East, tangent to last mentioned curve and parallel with said North line a distance of 105.11 feet; Thence South 00°06'44"West a distance of 100 feet; Thence North 89°48'00" East a dstance of 100 feet; Thence South 00°06'44" West a distance of 233.69 feet; Thence South B9°48'00" Westa distance of225 feet;to the TRUE POINT OF BEGINNING; containing 1,49 acres, m ore or less. A Z}L EXHIBIT"B" LEASE PROPERTY PLOT NOT TO SCALE GRAPHICAL REPRESENTATION ONLY N.fa Roatl FUTURE TIE DOWNAREA JPARCEL i ________________________________ s€TAXIWAY'G' s" u J � PARCEL PARCEL PARCEL PARCEL 14 6 8 3 a I a PARCEL 12 Awaucn Way cammoeomeom C.M.on" NEW CORPORATE FACILITY l PARCEL PARCEL PARCEL 2 1 2 4 w „„pry EXISTING CORPORATE FACILITY Jl � 1�1y� jua4�'s:LL�'4J11v3a`i[ FLIGHT SUP PORT V EXHIBIT"13-7" PLOT PLAN OF DEMISED PREMISES PARCEL9-HANGAR 40' 989°4B'00'W 12 7 ALEJO ROAD � 1470.10' 1 7g m N m NOT TO SCALE - - - Q 0 O o [BEGINNING POINT OF BEGINNING I N89°48'00"E 225:00' Bird Parcel mf N 1 v 2.173 ACRE cwv 1 o. .�rv.aSfi is•r i v N89'48'00'E 0 95-. " ' o w 25 i.00' % 2.0144ACREi.,; o _ 375.00' LIL- o. ... . ;. 00 " p o 'W of Parcel ? 1 o CITY YARD PARCEL Ita Too 3.71 ACRE we A.S. Parcel iu 1.8294 ACRE 1 1 S89°48'00'W 505.09 _ C. ............�: ..........._ J 332.00' i d .....................----------------........_:.................................,...........4-...................----------................ i 1 c U S U i O EXHIBIT"C, DEPICTION OF EXISTING EXECUTIVE TERMINAL AND HANGAR >v -71 z v, >L � o X � Z 11� X lfl 11] � K."V�yr r�yG,rya�ll i� if Not to 5cale , t''.re rill z !fj�f;ii� ttrii 4. 5WE12AffA PPOP05W U,5,CUSTOMS FACI[AfY 2,868 5Q.FL OTHER PEA a rli;as vhs f fih ri ! r T7'la P m!fe J) 99 fr'p !!t Y 516HAIMFUGNf5LFPORf EX151W EX WVU 0MIN&MP HMCJ+R m �✓ ^GCirvv x�°m„ �, r�af't'.`✓o.ex�Ctuk,'b.?t-",:3i��.s:.. ,t�o� EXHIBIT"D" DEPICTION OF "EXPANSION SPACE" ��` urtrw'c uxa Q , .a L c S t . li EXHIBIT"E" ESTOPPEL CERTIFICATE Tenant: Signature Flight Support Corporation Landlord: CITY OF PALM SPRINGS, a municipal corporation Date of Lease: Demised Premises: To: The undersigned hereby certifies as follows: 1. The undersigned is the tenant ("Tenant") under the above-referenced lease ("Lease") covering the above-referenced premises ("Demised Premises"). 2. The Lease constitutes the entire agreement between landlord under the Lease ("Landlord") and Tenant with respect to the Demised Premises and the Lease has not been modified, changed, altered or amended in any respect except as set forth above. 3. The term of the Lease commenced on , 20_, and, including any presently exercised option or renewal term, will expire on 20_. Tenant has accepted possession of the Demised Premises and is the actual occupant in possession thereof and has not sublet, assigned or hypothecated its leasehold interest. All improvements to be constructed on the Demised Premises by Landlord have been completed and accepted by Tenant and any tenant construction allowances have been paid in full. 4. As of this date, to the best of Tenant's knowledge, there exists no breach or default, nor state of facts which, with notice, the passage of time, or both, would result in a breach or default on the part of either Tenant or Landlord. To the best of Tenant's knowledge, no claim, controversy, dispute, quarrel or disagreement exists between Tenant and Landlord. 5. Tenant is currently obligated to pay Monthly Rent in installments of $ per month, and such monthly installments have been paid not more than one month in advance. In addition, the Lease requires Tenant to pay percentage rent each month in the amount of_ percent(_%) and percentage rent has been paid through _ 20__. To the best of Tenant's knowledge, no other rent has been paid in advance and Tenant has no claim or defense against Landlord under the Lease and is asserting no offsets or credits against either the rent or Landlord. Tenant has no claim against Landlord for any security or other deposits except$_ _which was paid pursuant to the Lease. 6. Tenant has an option to lease additional space within the Airport property of which the Demised Premises are a part, as set forth in the Lease. Tenant has no option or preferential right to purchase all of any part of the Demised Premises nor any right or interest with respect to the Demised Premises other than as Tenant under the Lease. Tenant has no right to renew or extend the term of the Lease except as set forth in the Lease. 7. Tenant has made no agreements with Landlord or its agent or employees concerning free rent, partial rent, rebate of rental payments or any other type of rent or other concession except as expressly set forth in the Lease. B. There has not been filed by or against Tenant a petition in bankruptcy, voluntary or otherwise, any assignment for the benefit of creditors, any petition seeking reorganization or arrangement under the bankruptcy laws of the United States, or any state thereof, or any other action brought under said bankruptcy laws with respect to Tenant. 9. All insurance, which Tenant is required to maintain under the Lease, has been obtained by Tenant and is in full force and effect and all premiums with respect thereto have been paid. Dated this day of 20_. By: Its: �L� EXHIBIT"F" NON-DISTURBANCE AGREEMENT THIS NON-DISTURBANCE AGREEMENT is made this _ day of , 200_ by and between THE CITY OF PALM SPRINGS, a California municipal corporation ("Authority") and , a ("Sublessee"). WHEREAS, Authority is the owner of certain real property located in Riverside County, California,which property is subject to a certain lease dated January_, 2004 by and between the Authority as Lessor and SIGNATURE FLIGHT SUPPORT CORPORATION ("Sublessor"), as Lessee ("Prime Lease"); and WHEREAS, Sublessor and Sublessee are about to enter into a sublease of a part of the premises which are the subject matter of the Prime Lease (which sublease is attached hereto as Exhibit A and is herein after referred to as the "Sublease"); and WHEREAS, the parties hereto desire to assure Sublessee's possession of the premises which are the subject matter of the Sublease upon terms and conditions therein set forth irrespective of the termination of the Prime Lease, subject to the terms herein. NOW, THEREFORE, In consideration of the covenants hereinafter set forth and of Sublessee entering into the Sublease, the parties hereto do hereby agree as follows: 1. The Authority consents to the execution and delivery of the Sublease in the form attached hereto as Exhibit A. 2. Provided the Sublease has not theretofore been terminated by Sublessor, in the event of the termination of the Prime Lease before the expiration of the term of the Sublease,for any reason other than the default of Sublessee, the Sublease shall continue as a lease between the Authority as Lessor and Sublessee as Lessee with the same force and effect as if the Authority as Lessor and Sublessee as Lessee had entered into a lease as of the date of the termination of the Prime Lease containing the same terms, covenants and conditions (including renewal options) as those contained in the Sublease for a term equal to the then unexpired term of the Sublease. This provision shall not apply and the Sublease shall terminate as specified in the Prime Lease if the Prime Lease is terminated under Section_therein [aviation-related termination purposes]. 3. Notwithstanding any provision in this agreement, any provision of the Sublease shall be subordinate to any inconsistent provision in the Prime Lease and Sublessee shall not be entitled to any right or remedy against Authority, its officers, employees or agents for any refusal by Authority to comply with such inconsistent provision in the Sublease. 4. From and after any such termination of the Prime Lease: a. Sublessee will attorn to the Authority, and the Authority will accept such attornment,subject to the provisions of Sections 2 and 3 above; 0- b. The Authority will have the same remedies for the breach of any agreement contained in the Sublease which Sublessor had or would have had if the Prime Lease had not been terminated; 5. Sublessee shall have the same remedies against the Authority for the breach of an agreement contained in the Sublease that Sublessee would have had against Sublessor if the Prime Lease had not been terminated. 6. No modification or amendment of the Prime Lease entered into by the parties thereto in substitution or replacement thereof shall be valid or binding as against the Sublessee without its prior written consent thereto, which consent shall not be unreasonably withheld. 7. Any notice or demand under the terms of this Agreement shall be in writing and shall be given or made by mailing to the same by registered or certified mail addressed to the respective parties at the addresses set forth opposite their signature below. 8. No modification, amendment, waiver or release of any provision of this agreement shall be valid for any purpose unless in writing and duly executed by the party against whom the same is thought to be asserted. 9. This agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors, assigns and sublessees and shall be governed by the laws of the State of California. CITY OF PALM SPRINGS By By G EXHIBIT B DEPICTION OF LEASED PREMISES (per subsequent attachment) 29 CADocuments and SettingsljbrewarlLooal SeWngffempTSP Hangars LLC revised final 082804.doc I ' I11� III: ti II I � ; � I I I Mal 'tF 7 lip €Pil� � sr s M2 b iff �4 i A � ii SE i R•R"•F �A A f �ji t R• E Ogi}�[j�: g9pi e r eRR� dae a eR�' ���sf'� I . . . . �•e 5i�� aif �' F �i86 ' 3�R71 � . - e �k S eP R i . 0 PPUASPRING$ •p `�/�' MPARCELIDNALNRPOiCf c_ PMGEI.S*3 aM I6 A +;� `�. P t�y''yy`T s u Pr u.l T_� ew.d.n n...b'� rm•^�a•uP"° a EXHIBIT "e—i" NON-DISTURBANCE AGREEMENT THIS NON-DISTURBANCE AGREEMENT is made this _ day of _, 200_ by and between THE CITY OF PALM SPRINGS, a California municipal corporation ("Authority") and _, a ("Sublessee"). WHEREAS, Authority is the owner of certain real property located in Riverside County, California, which property is subject to a certain lease dated January_, 2004 by and between the Authority as Lessor and SIGNATURE FLIGHT SUPPORT CORPORATION ("Sublessor"), as Lessee ("Prime Lease"); and WHEREAS, Sublessor and Sublessee are about to enter into a sublease of a part of the premises which are the subject matter of the Prime Lease (which sublease is attached hereto as Exhibit A and is herein after referred to as the"Sublease"); and WHEREAS, the parties hereto desire to assure Sublessee's possession of the premises which are the subject matter of the Sublease upon terms and conditions therein set forth irrespective of the termination of the Prime Lease, subject to the terms herein. NOW, THEREFORE, in consideration of the covenants hereinafter set forth and of Sublessee entering into the Sublease, the parties hereto do hereby agree as follows: 1. The Authority consents to the execution and delivery of the Sublease in the form attached hereto as Exhibit A. 2. Provided the Sublease has not theretofore been terminated by Sublessor, in the event of the termination of the Prime Lease before the expiration of the term of the Sublease, for any reason other than the default of Sublessee,the Sublease shall continue as a lease between the Authority as Lessor and Sublessee as Lessee with the same force and effect as if the Authority as Lessor and Sublessee as Lessee had entered into a lease as of the date of the termination of the Prime Lease containing the same terms, covenants and conditions (including renewal options) as those contained in the Sublease for a term equal to the then unexpired term of the Sublease. This provision shall not apply and the Sublease shall terminate as specified in the Prime Lease if the Prime Lease is terminated under Section_therein [aviation-related termination purposes]. 3. Notwithstanding any provision in this agreement, any provision of the Sublease shall be subordinate to any inconsistent provision in the Prime Lease and Sublessee shall not be entitled to any right or remedy against Authority, its officers, employees or agents for any refusal by Authority to comply with such inconsistent provision in the Sublease. 4. From and after any such termination of the Prime Lease: a. Sublessee will attorn to the Authority, and the Authority will accept such attornment, subject to the provisions of Sections 2 and 3 above; b. The Authority will have the same remedies for the breach of any agreement contained in the Sublease which Sublessor had or would have had if the Prime Lease had not been terminated; 5. Sublessee shall have the same remedies against the Authority for the breach of an agreement contained in the Sublease that Sublessee would have had against Sublessor if the Prime Lease had not been terminated. 6. No modification or amendment of the Prime Lease entered Into by the parties thereto in substitution or replacement thereof shall be valid or binding as against the Sublessee without its prior written consent thereto, which consent shall not be unreasonably withheld. 7. Any notice or demand under the terms of this Agreement shall be in writing and shall be given or made by mailing to the same by registered or certified mail addressed to the respective parties at the addresses set forth opposite their signature below, 8. No modification, amendment, waiver or release of any provision of this agreement shall be valid for any purpose unless in writing and duly executed by the party against whom the same is thought to be asserted. 9. This agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors, assigns and sublessees and shall be governed by the laws of the State of California. CITY OF PALM SPRINGS By By EXHIBIT "C-2" RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: CONSENT,NON-DISTURBANCE AND ATTORNMENT AGREEMENT THIS CONSENT, NON-DISTURBANCE AND ATTORNMENT AGREEMENT ("Agreement")is entered into as of by and between whose address is ("Owner"), SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation with its principal offices located at 201 South Orange Avenue, Suite 1100, Orlando, Florida 32801 ("Signature"), , [an unincorporated association/a nonprofit public benefit corporation],whose address is ("Association"),PSP HANGARS I,LLC, a Colorado limited liability company, with its principal offices located at 2939 Ohio Way, Denver, Colorado 80209 ("PSP"). For purposes of this Agreement, Owner, Signature and the Association are from time to time hereinafter referred to individually as a"Party" and collectively as the"Parties." RECITALS A. The City of Palm Springs ("Authority"), as landlord, and Signature, as tenant, have entered into that certain Lease with Signature Flight Support Corporation For Fixed Base Operator(FBO) Services at the Palm Springs International Airport dated as of , 2004 ("Master Lease"), whereby Signature leased certain land and improvements (the "Master Premises") at the Palm Springs International Airport in Palm Springs, California ("Airport") from the Authority, including the land on which the Hangar Facility (as defined below) has been constructed,for the purpose of operating a fixed base operation at the Airport. B. Signature, as sublandlord, and PSP, as subtenant, have entered into that certain Ground Sublease Agreement dated as of., 2004 ("Ground Sublease"), whereby PSP subleased a portion of the Master Premises commonly known as and more particularly described on Exhibit A ("Sublease Premises") and constructed thereon a _ - unit hangar facility (the "Hangar Facility"). C. PSP has created a condominium subdivision of the Hangar Facility consisting of condominium units and formed the Association in accordance with California law. & 1; / w 6 601507.1 D. Pursuant to that certain [Assignment of Subtenant's Interest in Sublease and Consent] by and between Signature, PSP and the Association dated as of. ,200 ("Assignment"), PSP assigned to the Association all of its right, title and interest in and to the Ground Sublease, and the Association agreed to assume all of PSP's obligations thereunder. E. Owner is the purchaser of a hangar condominium unit at Hangar Facility commonly known as and more particularly described on Exhibit B attached hereto and made a part hereof(the "Unit"), F. In connection with Owner's purchase of the Unit, Owner has entered into that certain [Hangar Sublease] with the Association dated as of , 200 ("Hangar Sublease") concurrently with the Owner's execution of this Agreement. Owner's interest in the Unit is also subject to the [Declaration of Condominium], the Bylaws of the Association,the Ground Sublease and the Master Lease. NOW, THEREFORE, in consideration of the covenants of the Parties herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows: AGREEMENT 1. Consent. Signature hereby consents to the Hangar Sublease; provided however, notwithstanding anything contained in the Hangar Sublease to the contrary, such consent is granted only upon the terms and conditions set forth in this Agreement. The Hangar Sublease is subject and subordinate to the Master Lease and the Ground Sublease. Except as set forth in Section 3(b) below, Signature shall not be bound by any of the terms, covenants, conditions, provisions or agreements of the Hangar Sublease nor have any obligation to Owner thereunder, notwithstanding the fact Signature is a third party beneficiary of certain provisions as set forth in Section 3 below. 2. Non-Release of the Association, Further Transfers. Except as specifically set forth in the Ground Sublease, neither the Hangar Sublease nor this consent thereto shall release or discharge the Association from any liability,whether past,present or fature,under the Ground Sublease or alter the primary liability of the Association to pay the rent and perform and comply with all of the obligations of PSP and the Association to be performed under the Ground Sublease. 3. Assignment of Hangar Sublease Rents. The Association hereby assigns and transfers to Signature the Association's interest in the Hangar Sublease and all rentals and income arising therefrom, as security for the performance of all of the Association's obligations under the Ground Sublease subject to the terms of this Section 3. Signature agrees that until such time as a default shall occur in the performance of the Association's obligations under the Ground Sublease, and such default continues uncured after the expiration of any applicable notice or grace period, the Association may receive, collect and enjoy the rents accruing under the Hangar Sublease. In the event the Association shall default in the performance of its obligations to Signature under the Ground Sublease (whether or not Signature terminates the 601507.1 2 Ground Sublease), and if such default continues uncured after the expiration of any applicable notice or grace period, Signature may, at its option by notice to the Association, elect to (i) receive and collect, directly from Owner, all rent and any other sums owing and to be owed under the Hangar Sublease, as further set forth in Section 3(a),below; (ii) elect to succeed to the Association's interest in the Hangar Sublease and cause Subtenant to attorn to Signature, as further set forth in Section 3(b) below; or (iii) subject to the non-disturbance provisions set forth in Section 3(b) below, terminate the Ground Sublease and the Hangar Sublease and regain possession of the Sublease Premises. (a) Signature's Election to Receive Rents. Signature shall not, by reason of the Hangar Sublease nor by reason of the collection of rents or any other sums from the Owner, be deemed liable to Owner for any failure of the Association to perform and comply with any of its obligations under the Hangar Sublease, and the Association hereby irrevocably authorizes and directs Owner, upon receipt of any written notice from Signature stating that a default exists in the performance of the Association's obligations under the Ground Sublease, to pay to Signature the rents and any other sums due and to become due under the Hangar Sublease. The Association agrees that Owner shall have the right to rely upon any such statement and request from Signature, and that Owner shall pay any such rents and any other sums to Signature without any obligation or right to inquire as to whether such default exists and notwithstanding any notice from or claim from the Association to the contrary. The Association shall not have any right or claim against Owner for any such rents or any other sums so paid by Owner to Signature. Signature shall credit the Association with any rent received by Signature under such assignment but the acceptance of any payment on account of rent from Owner as the result of any such default shall in no manner whatsoever be deemed an attornment by Signature to Owner or by Owner to Signature, be deemed a waiver by Signature of any provision of the Ground Sublease or serve to release the Association from any liability under the terms, covenants, conditions, provisions or agreements under the Ground Sublease. Notwithstanding the foregoing, any other payment of rent from the Owner directly to Signature, regardless of the circumstances or reasons therefor, shall in no manner whatsoever be deemed an attonnment by the Owner to Signature in the absence of a specific written agreement signed by Signature to such an effect or the satisfaction of the conditions to such attornment set forth in Section 3(b)below. (b) Non-Disturbance and Attornment. If the Ground Sublease is terminated or cancelled prior to the end of its respective term, then so long as Owner is not in default under the Hangar Sublease beyond any period given Owner by the terms thereof to cure such default, Owner's rights under the Hangar Sublease shall not be affected, and Owner's possession or occupancy of the Unit under the Hangar Sublease shall not be disturbed. In such event, Signature shall recognize the Owner's subleaschold estate under the Hangar Sublease for the remaining balance of the term plus any extensions thereof effected in accordance with the options therefor in the Hangar Sublease, the Hangar Sublease shall continue in full force and effect as if Signature were the original landlord, and Owner shall attorn to Signature as Owner's landlord under the Hangar Sublease, except Signature shall not (i) be liable for any prepayment of more than one month's rent or any security deposit paid by Owner(unless actually received by the Authority or Signature, as the case may be), (ii)be liable for any previous act or omission of the Association under the Ground Sublease or for any other defaults of the Association under the Hangar Sublease, (iii)be subject to any defenses or offsets previously accrued which Owner may 601507.1 3 } have against the Association, or (iv) be bound by any changes or modifications made to the Hangar Sublease without the written consent of Signature. Owner hereby attoms to Signature, as its landlord and, provided Owner is not in default under the Hangar Sublease beyond any period given Owner by the terms thereof to cure such default at the time of termination or cancellation of the Ground Sublease, Signature will accept such attornment, said attornment to be effective and self-operative without the execution of any further documents immediately upon the termination or cancellation of the term of the Ground Sublease. Owner agrees, however, upon the election of and written demand by Signature after the termination or cancellation of the Ground Sublease, to execute an instrument in confirmation of the foregoing provisions, satisfactory to Signature, in which Owner shall acknowledge such attornment and shall set forth the terms and conditions of its tenancy. 4. Third Party Beneficiary. Subtenant agrees that Signature shall be a third party beneficiary of Owner's indemnity obligations to the Association contained in the Hangar Sublease, all of which shall also inure to the benefit of the Authority and Signature, and their parent and affiliated corporations, and its and their officers, directors, shareholders, employees, agents, contractors, successors and assigns. 5. General Provisions. (a) Consideration for Hangar Sublease. The Association and Owner represent and warrant that there are no additional payments of rent or any other consideration of any type payable by Owner to the Association with regard to the Unit other than as disclosed in the Hangar Sublease. (b) Brokerage Commission. The Association and Owner covenant and agree that under no circumstances shall Signature be liable for any brokerage commission or other charge or expense in connection with the Hangar Sublease and the Association and Owner agree to protect, defend indemnify and hold Signature harmless from the same and from any cost or expense(including but not limited to attorneys'fees)incurred by Signature in resisting any claim for any such brokerage commission. (c) Controlling_Law. The terms and provisions of this Agreement shall be construed in accordance with and governed by the laws of the State of California. (d) Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their heirs, successors and assigns including the successors of Owner in the Unit. As used herein, the singular number includes the plural and the masculine gender includes the feminine and neuter. (e) Captions. The paragraph captions utilized herein are in no way intended to interpret or limit the terns and conditions hereof, rather, they are intended for purposes of convenience only. (f) Partial Invalidity. if any tern, provision or condition contained in this Agreement shall, to any extent, be invalid or unenforceable, the remainder of this Agreement, or 1.017 601507.1 4 the application of such term, provision or condition to persons or circumstances other than those with respect to which it is invalid or unenforceable, shall not be affected thereby, and each and every other term,provision and condition of this Agreement shall be valid and enforceable to the fullest extent possible permitted by law. (g) , Attorneys' Fees. If either party commences litigation against the other for the specific performance of this Agreement, for damages for the breach hereof or otherwise for enforcement of any remedy hereunder, the parties hereto agree to and hereby do waive any right to a trial by jury and, in the event of any such commencement of litigation, the prevailing party shall be entitled to recover from the other party such" costs and reasonable attorneys' fees as may have been incurred. (h) Notices. All notices and other communications provided for under this Agreement shall be in writing and shall be personally delivered or sent by certified United States mail, by nationally recognized overnight courier such as Federal Express, or by facsimile or by other means of telecommunication, to the following addresses: Signature: Signature Flight Support Corporation 201 South Orange Avenue, Suite 1100 Orlando, Florida 32801 Attention: Contracts Fax: (407) 648-7352 and: Signature Flight Support Corporation Pahn Springs Regional Airport 210 North El Cielo Palm Springs, California 92262 Attention: General Manager Fax: 760-327-6509 PSP: PSP Hangars 1,LLC 2939 Olio Way Denver, Colorado 80209 Attention: Michael E.Dunn Fax: (303) 777-7823 Association: Attention: Fax: or, as to each party, at such other address as shall be designated by such party in a written notice to the other parry complying as to delivery with the terms of this Section. All such notices and communications shall be deemed received(i)if personally delivered,upon delivery; (ii) if sent by certified United States mail, following deposit in the mail with postage prepaid, upon receipt; 601507.1 5 (iii)if sent by courier service with next business day delivery charges prepaid, upon receipt; and .(iv) if sent by facsimile or similar form of telecommunications, upon receipt if received on or before 5:00 p.m. local time at the receiving party's facsimile machine during a business day or otherwise on the next business day. (i) Conflict with Hangar Sublease. In the event of any conflict between the provisions of this Agreement and the Hangar Sublease, the provisions of this Agreement shall control. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written. SIGNATURE: PSP: By: By: Name: Name: Title: Title: ASSOCIATION: By: Name: Title: OWNER: By: Name: Title: 601507.1 EXHIBIT D VENDOR RELEASE AND INDEMNIFICATION FOR THE PERFORMANCE OF AIRCRAFT MAINTENANCE AND OTHER RELATED AIRCRAFT SERVICES TO TRANSIENT OR TENANT AIRCRAFT SIGNATURE FLIGHT SUPPORT CORPORATION, a Delaware corporation, (hereinafter, "Signature"), which maintains a flight support operation (hereinafter "FSO") at Airport, (hereinafter "Airport"), by its execution hereof, hereby authorizes the following person or entity, (hereinafter "Vendor"), to enter the FSO premises on a temporary basis, consistent with the terms and conditions hereinafter stated. 1. Vendor. The name, address and telephone number of the Vendor are as follows: Name Address: Telephone: Type of Aircraft Requiring Maintenance/Servicing: Aircraft Registration Number: Aircraft Owner/Operator: 2. Services To Be Performed. Vendor shall enter the premises of Signature for the sole purpose of performing maintenance, cleaning or other related work on the above referenced aircraft (hereinafter, "Aircraft") at the request of the Aircraft owner, pilot or other designated representative. Vendor shall be authorized to perform maintenance and repair work exclusively to the Aircraft and only in the area designated for such maintenance, cleaning and/or repair work by local Signature management. Vendor expressly agrees that at no time shall its maintenance activities infringe upon the ability of Signature or other tenants to operate aircraft, including, but not limited to, ingress and egress from the FSO, and their respective office, shop, parking and/or hangar space(s) as a result of Vendor's maintenance activities. 3. Aircraft SecuritV.. The Aircraft which is the subject of this Release shall be stored within the boundaries of the Airport's perimeter fence. Vendor represents that it shall adhere at all times to the prevailing and applicable Airport and Federal Aviation Administration ("FAA")security regulations and the Transportation Security Administration ("TSA"). 4. Indemnification. Vendor agrees to indemnify, defend and hold harmless Signature and the Airport, their respective officers, directors, agents and employees and Signature's parent, subsidiary, related and affiliated companies from and against any and all liabilities, damages, injuries, losses, claims, fines, penalties or judgments, of any kind whatsoever (including those arising from third parties), including all costs, attorneys' fees, and expenses incidental thereto, which may be suffered by, or charged to, Signature by reason of any loss of or damage to any property or injury to or death of any person arising out of or by reason of any breach, violation or non-performance by Vendor or its agents, servants, consultants, contractors, subcontractors, licensees or employees of any covenant or condition of this Release or by any act or failure to act or negligence of such persons. �/ 32 }J�f 4: CADocuments and Setdngsl brewerlLocal SettingslTempTSP Hangars LLC revised final 062804.doc 5. Insurance. Vendor represents to Signature that it has secured and presently maintains Worker's Compensation, Employer's Liability, Automobile, and Comprehensive General Liability insurance with respect to Airport liability and completed operations on an occurrence basis from a qualified insurer as set forth on the attached Exhibit "D." Vendor further represents that it has Environmental/Pollution liability insurance as required on Attachment "D." Vendor further agrees to provide a Certificate of Insurance on a standard ACCORD form showing Signature and Airport Authority, its respective officers, directors, agents, and employees and Signature's parent, subsidiary, related and affiliated companies as additional insureds. Vendor and its insurers agree to waive their rights of subrogation in favor of Signature with respect to loss or damage resulting from the services to be performed or furnished hereunder, except where loss or damage results from the gross negligence or willful misconduct of Signature. Additionally, it is understood that Vendor's liability extends beyond the FSO and its immediate surrounding environment to encompass all of Vendor's acts or omissions while operating on the Airport and Signature's entire leasehold. IN WITNESS WHEREOF, the parties have executed this Release as of the day and year first above written. SIGNATURE FLIGHT SUPPORT (Vendor) CORPORATION By: By: Its: Its: Date: Date: or-� 14 33 C:1Documents and Set0n9sybrewerlLoce1 SettingslTemp\PSP Hangars LLC revised final 062804.doc "Attachment D" MAIL CERTIFICATES TO: Signature Insurance Department, PO Box 9085, Mission Viejo, CA 92690- 9085 Insurance Company Financial Strength Requirements ❑ AM Best Rating : B+ ❑ Financial Size : V Minimum Insurance Dollar Limits Required From SFSC Customers, Tenants &Vendors entering or using SFSC ramp or hangars as services apply and for expressly permitted construction activities: JFI' 'lJl , 1 r,'r��01'llhtyl,.Airport l'plelYllS$5 of s;.aJ, Ia> d.., _I1,'; ❑ Commercial General *including products and completed operations ■ Tie Downs/T Hangars/Office Combined Single Limit$2,000,000 per occurrence* ■ All Others Combined Single Limit$5,000,000 per occurrence* ❑ Auto Combined Single Limit$5,000,000 per occurrence ❑ Environmental/Pollution Combined Single Limit$5,000,000 per occurrence L18�111t!, LOff,AlrpOrk''Premises ,II ❑ Auto Combined Single Limit $1,000,000 per occurrence. ❑ Commercial General Combined Single Limit$ 1,000,000 per occurrence for products and completed operations ➢ Liabilfy'�Otheri - ,, ', ;,'°. , , _:, � I � I i ' , ❑ Builder's Risk "All Risk", Full Completed Value of Project and must include "Delay in Start-Up" ❑ Professional (Errors & Omissions) Combined Single Limit $5,000,000 per occurrence ,Ili J I� 1'll al^�7 °11 G , I,'ll 17111 y v� .1F1 ft''I� a',i oNJ J 1 VII ov 'z" L h J ,� Ia { h iu 4 k.J' I �t, it-�...µ .l I:.., _ �, r 7 y, ...,.u.4., ''4„n 9..'al� a r i, .. ._., : _ ,.... . . ❑ �P�roperty "All Risk", Full Replacement Value I� YY , a L } 4. , gfhl i 91 1 10 I11 +. orkgrjs°Compensati,`on & Employer,s_LiabtlifY _, ,� ,p,i,u,u VIA! ..i11 JI ❑ Worker's Compensation Statutory ❑ Employer's Liability $1,000,000 each occurrence for bodily injury by accident $1,000,000 each occurrence for bodily injury by disease $1,000,000 policy limit for bodily injury by disease Special Provisions For Endorsements and Certificate of Insurance: -All such required liability insurance, except Workers Compensation and Employers Liability shall name Signature Flight Support Corporation, its parent, subsidiary, related and affiliated companies, as additional insureds and insured shall provide additional insured endorsement. If the required liability polices do not contain a standard separation of insured provision, they shall be endorsed to provide cross liability coverage. All required 34 C:\Documents and Settin90jbrevver\Lom1 Settings\Temp\PSP Hangars LLC revised final 062804.doc insurance policies, except Workers Compensation and Employers Liability shall contain a waiver of subrogation in favor of Signature Flight Support Corporation, its parent, subsidiary, related and affiliated companies. Any Certificate of Insurance shall evidence all required policy limits and shall provide at least thirty (30) days advance written notice of any cancellation or changes adverse to the interests of Signature Flight Support Corporation, its parent, subsidiary, related and affiliated companies. NOTE: Minimum insurance amounts stated cannot be lowered without express written consent of Signature Flight Support Corporation. Higher insurance limits required by 'Airport Authorities, will supersede the limits stated above and will require verification and possible coverage & premium increases. 35 CADomments and SettingsybrewerlLocal SettingslTempTSP Hangars LLC revised final 062804.doo EXHIBIT E ENVIRONMENTAL PROTECTION PROCEDURES ENVIRONMENTAL ASSESSMENT 1. Environmental Protection Procedures — Sublessee shall conduct its operations to meet or exceed requirements set forth in applicable local, state, and federal laws and in accordance with safe and proper industry practices in order to prevent environmental accidents. Such practices include but are not limited to the following: a. Sublessee shall provide copies of Material Safety Data Sheets for each and every Regulated Substance used or stored on the Leased Premises stating the name, location, description, and quantify of any Regulated Substance in, on, or at the Leased Premises; b. Sublessee shall provide Signature written notice and copies of documents verifying that Sublessee has removed and disposed of any and all Regulated Substance safely, properly, and in a manner which meets or exceeds applicable Law; C. Sublessee shall not wash or clean its equipment including but not limited to aircraft on the Leased Premises. Sublessee shall at all times protect the drain from spills of Regulated Substances and agrees to instruct all its employees, agents, servants, contractors, subcontractors, invitees, and other representatives in writing regarding such requirement and the proper operation and maintenance of this drainage system; d. Sublessee shall not place or maintain open containers outside the Hangar during inclement weather; e. Sublessee shall cover any and all trash containers placed or maintained outside the Hangar. 2. Environmental Assessment - Sublessee hereby acknowledges that it has _. reviewed the Environmental Assessment provided previously and incorporated by reference into described as: • Letter dated March 10, 1999 from G&M Construction to Harry Harris at AMR Combs- PS International Airport; • Letter dated November 5, 1998 from Donn V. Lentz, Project Manager, Flour Danial to Susan Gesoff,American Airlines, together with enclosures. • Phase I Environmental Site Assessment AMR-Combs-PSP, 210 N. El Ciclo, Palm Springs, California, prepared by Flour Daniel GTI, Inc. dated October 29, 1998 and warrants that such Environmental Assessment is accepted as a baseline of conditions satisfactory for its use and occupancy of the Leased Premises. Initial here 35 � �9 ::ODMAIGRPWISE1GWDomaln.GWPost.G WLI94:577119.12 EXHIBIT T" Sublessee's Concept and Scope Schedule A 37 CADocuments and SetungsVbrewer1ocal SetUngs\Temp\PSP Hangars LLC revised final 062804.doc EXHI BI T "F-1" Sublessee's Concept and Scope Schedule The Sublessee's concept is to development sixteen box hangars on Parcels#3 and#6 of Palm Springs International Airport. Parcel #3 will have eight box hangars, six at 60 x 60 size and two at 60 x 65 size all in one building. Parcel #6 will also have eight box hangars, all eight at 60 x 60 size and all in one building. The structures will be pre-engineered metal buildings with metal wall panels, metal low slope roofing, and metal clad bi-fold overhead hangar doors. The foundations will be concrete slab on grade. The ramp areas around the hangars and the auto drive and parking areas will be asphalt paving. See Exhibits"F-2" and "F3" for more information regarding the Site Plan and the Building 6evations. F 99 M EEC sm `. i 1MOdtlIVTVNOIl I . _ 59NlYd`+WlY�N31fll 1`!rJC'3� F �' a� t I ol. �k I`. I EXHIBIT"F-2" Sublessee's Concept and Scope Schedule 4 iytl��yy ,b�1 tY1iE i1:d1 Y& fP [ 9Y@� I JI . Ef E ►,PI flip. W ' I }i A 'fillff L �I .WSa v.NII AY HT. : I s > � 1 fig fill! MINOR I JI L =� I I all lmvlvd ¢¢ TMOIIVw13W7 ' y • _�y� �i ," s wads wma � w EXHIBIT"F-3° ! Sublessee's Concept and Scope Schedule i I 1 j I li I It � F _ — b a _ 'T$e1111 1 it I yti�Y!}ff � Y' !Ii1V4 i I _ I I r i" 3 � IIII'_ i __ �d���._• 'i llii. I II . ICI j.�li ;lfi — :-�' ii�l '' I;.�I .1 i,�' .� .IN -_ 'i . - it i _ 1 i i I MINUTE ORDER NO. THAT THE CITY COUNCIL CONSENT TO A SUBLEASE AGREEMENT BETWEEN SIGNATURE FLIGHT SUPPORT CORPORATION AND PSP HANGARS I LLC AND EXECUTE ANON-DISTURBANCE AGREEMENT BETWEEN THE CITY OF PALM SPRINGS AND PSP HANGARS I LLC IN A FORM ACCEPTABLE TO THE CITY ATTORNEY. - - - - - - - - - - - - - - - - I HEREBY CERTIFYthat this Minute Order consenting to a sublease agreement between Signature Flight Support Corporation and PSP Hangars I LLC and executing a non-disturbance agreement between the City of Palm Springs and PSP Hangars I LLC in form acceptable to the City Attorney, was approved by City Council of the City of Palm Springs, California in a meeting thereof held on the 6th day of October, 2004. PATRICIA A. SANDERS City Clerk