HomeMy WebLinkAbout03881 - TWA TRANS WORLD AIRLINES AIRPORT LEASE pAL11 s City of Palm Springs
A*' Office of the City Clerk
c (760) 323-8204
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MEMORANDUM
C14 1 FORV�\t
Date: April 18, 2003
To: Airport
From: City Clerk
AGREEMENT#3881, Trans World Airlines, Inc. — Lease Agreement
Please let us know the status of the above agreement, and if it may be closed.
Termination Date of Agreement: 6-30-04
STATUS:
COMPLETED:
REMAIN OPEN UNTIL:
Date & Initials
CLOSE AGR
Sigi'tature
Attached is the last certificate of insurance we have received from Trans World.
PLEASE RETURN TO THE OFFICE OF THE CITY CLERK
c-clk\fomis.std\agr-clse.mem
ARTICLE XVI
ASSIGNMENT AND SUBLEASE
Section 16.01 Assignment and Sublease
Airline shall not assign or transfer this Agreement, the Premises or any part thereof, without
the prior written consent of the City, which consent shall riot be unreasonably withheld. For purposes
of this Agreement, an assignment shall be deemed to include the transfer to any person or group of
persons acting in conceit, of more than fifty percent 50% of the present ownership and/or control of
Airline, taking all transfers into account on a Cumulative basis. Notwithstanding the foregoing, Airline
may assign this Agreement to any successor-in-interest of Airline with or into which Airline may merge
or consolidate or to any entity which may acquire substantially all of the assets of Airline without the
consent of the City; provided that said assignee complies with all of the other terms of this Section.
Airline shall not sublease all or any part of the Premises without the prior written approval of the City,
which approval shall not be unreasonably withheld.
City may withhold its consent to an assignment or sublease to a proposed assignee or
sublessee, and Airline agrees that City shall not be unreasonable for doing so, if all of the following
criteria are not met: (a) the proposed assignee's or sublessee's general financial condition, including
liquidity and net worth, verified by audited financial statements prepared by a certified public
accountant in conformity with generally accepted accounting principles, is equal to or greater than that
of Airline; (b) the proposed assignee has a demonstrated business capability equal to or greater than
that of Airline in operating an Airline Transportation business; and (c) the proposed assignee is morally
and financially responsible. Prior to the effectiveness of any assignment or subletting, regardless of
whether the consent of the City is required, the assignee or sublessee shall assume all of the
obligations of Airline hereunder, in writing in a form satisfactory to the City. Said assignment or
sublease shall be subject to all of the terns and conditions of this Agreement.
City shall be under no obligation to consider a request for City's consent to an assignment until
Airline shall have submitted in writing to City a request for City's consent to such assignment or
subletting together with audited financial statements of Airline and the proposed assignee or sublessee,
a history of the proposed assignee's or sublessee's business experience and such other information
as required by City to verify that the criteria for assignment and subletting as set forth herein are met.
The consent by City to one assignment or subletting by another person or entity shall not be
deemed to be a consent to any subsequent assignment or subletting. Any assignment or subletting
Airport Use and Lease Agreement 40 Dated 07/01/94
requiring the consent of City made without obtaining such consent shall constitute a material breach
of this Agreement, and shall, at the option of the City, terminate this Agreement.
ARTICLE XVII
SURRENDER OF POSSESSION
HOLDING OVER
Section 17.01 Surrenderof Possession - Holding Over
Airline agrees to yield and deliver to the City the possession of the Premises including the
Premises leased exclusively or preferentially to Airline orjointly to Airline and others, at the termination
of this Agreement by expiration or otherwise. Such Premises shall be delivered in clean and good
condition in accordance with Airline's express obligations hereunder, except for reasonable wear and
tear, fire and other casualty. Airline shall have the right at any time during the term of this Agreement,
or any renewal or extension hereof, to remove or sell its trade fixtures and equipment situated on the
Premises that were installed, or placed by it, at its expense in, on or about the Premises pursuant to
the provisions of this Agreement subject however to any valid lien that the City may have thereon for
unpaid fees or other charges. Any such removal shall be at Airline's expense and accomplished in
a good workmanlike manner. Any damage occassioned by such removal shall be repaired at Airline's
expense so that the Premises may be surrendered in a good, clean and sanitary condition.
Any holding over by Airline after the cancellation or termination of this Agreement shall not
operate to extend or renew such Agreement for any further term whatsoever. Acceptance by City of
payment of rents, fees or charges after cancellation or termination shall be deemed to be payment on
account and shall not operate to waive or modify any provision of this paragraph.
ARTICLE XVIII
TAXES
Section 18.01 Taxes
All taxes imposed on this Agreement as extended or modified (including any renewals thereof
and property interests created thereby) and on any other agreements now in effect between City and
Airline or which may hereinafter be entered into between the Airline and City (including any renewals
thereof and property interests created thereby) shall be charged to and paid by Airline.
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Without limiting the generality of the foregoing, Airline shall pay all rental and/or sales taxes,
if any, assessed or levied on account of amounts payable by Airline to City hereunder.
Airline acknowledges that this Agreement may create a possessory interest subject to property
taxation, and that Airline shall be subject 4o payment of any real property taxes or excise taxes levied
on such interest and/or upon the fee estate of the City. Real property taxes shall include any form of
real estate taxes or assessments, general, special, ordinary or extraordinary and any license fee, rental
tax, improvement bond or bonds, levy, penalty, or tax composed by any authority having the power
to tax as against any legal or equitable interest of City on the Airport or on the underlying realty, as
against City's right to receive rent or other income therefrom or as against City's business of leasing
the Airport whether now or hereafter enacted.
Airline shall also pay all personal property taxes and assessments levied upon Airline's personal
property located on the Premises.
If the Airline shall fail to pay said taxes, charges, or assessments within thirty (30) days before
they become delinquent, City may, at its option, pay such taxes, charges or assessments without pre-
empting the Airlines right to protest. Such amount paid by City, plus interest at the rate of ten percent
(10%) per annum, shall be considered as an additional charge payable hereunder and shall be due
and payable at the next due date for Airline Rates and Charges.
ARTICLE XIX
DEFAULT AND CANCELLATION
Section 19.01 Default by Airline
The occurrence of any one or more of the following events shall constitute a default and breach
of this Agreement by Airline: (a) the failure to pay any rental or other payment required hereunder to
or on behalf of Airport more than three (3) days after receipt of written notice from City to Airline that
Airline has failed to pay rent when due; (b) the failure to perform any of Airline'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 Airline which notice
shall be deemed to be the statutory notice so long as such notice complies with statutory requirements;
(c) the vacation or abandonment of the Premises by Airline; (d) the making by Airline of a general
assignment for the benefit of creditors; (e) the filing by Airline of a voluntary petition in bankruptcy or
the adjudication of Airline as a bankrupt; (f) the appointment of a receiver to take possession of all or
Airport Use and Lease Agreement 42 Dated 07/01/94
substantially all the assets of Airline located at the Premises or of Airline's leasehold interest in the
Premises; (g) the filing by any creditor of Airline of an involuntary petition in bankruptcy which is not
dismissed within sixty (60) days. Any repetitive failure by airline 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 during any 5 year
period of this Agreement 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 Airline to perform its
obligations hereunder.
Section 19.02 Remedies Upon Default
In the event of any such default or breach by Airline, 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 Airline to City upon demand and as additional rental hereunder. In the event
of any such default or breach by Airline, 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 Agreement, including the right to
recover the rental as it becomes due under this Agreement, or (ii) City shall have the right at any time
thereafter to elect to terminate the Agreement and Airline's right to possession thereunder. Upon such
termination, City shall have the right to recover from Airline:
(a) The worth at the time of award of the unpaid Airline Rates and Charges which had been
earned at the time of termination;
(b) The worth at the time of award of the amount by which the unpaid Airline Rates and
Charges which would have been earned after termination until the time of award
exceeds the amount of such Airline Rates and Charges that the Airline proves could
have been reasonably avoided;
(c) Any other amount necessary to compensate the City for all the detriment proximately
caused by Airline's failure to perform its obligations under the Agreement or which in
the ordinary course of things would be likely to result therefrom.
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) above shall be computed by
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discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award plus one percent (1%), W in no event greater than ten percent (10%).
Such efforts as City may make to mitigate the damages caused by Airline's breach of this
Agreement shall not constitute a waiver of City's right to recover damages against Airline hereunder,
nor shall anything herein contained affect City's right to indemnification against Airline for any liability
arising prior to the termination of this Agreement for personal injuries or property damage, and Airline
hereby agrees to indemnify and hold City harmless from any such injuries and damages, including all
attorney's fees and costs incurred by Airport in defending any action brought against City for any
recovery thereof, and in enforcing the terms and provisions of this indemnification against Airline.
Notwithstanding any of the foregoing, the breach of this Agreement by Airline, or an
abandonment of the Premises by Airline, shall not constitute a termination of this Agreement, or of
Airline'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 Agreement, including the right
to recover Airline Rates and Charges, and all other payments to be made by Airline hereunder, as they
become due. Failure of City to terminate this Agreement shall not prevent City from later terminating
this Agreement or constitute a waiver of City's right to do so.
Section 19.03 Cancellation by City
(A) Preferential Use of Concourse Gate Positions. If, at any time, one or more of Airline's
Preferential Use Concourse Gate Positions is underutilized as hereinafter set forth, City may cancel
Airline's Preferential Use of such underutilized Concourse Gate Position by giving Airline at least thirty
(30) days prior written notice. The one gate position guarantee set forth in Section 10.04 shall remain
in effect during the term of this Agreement.
Any Concourse Gate Position shall be deemed to be underutilized if during the preceding
twelve (12) months a secondary user of Airline's Concourse Gate Position has a greater number of
Fee Landings utilizing such Preferential Use Concourse Gate Position, for the purpose of loading and
unloading passengers, than Airline.
If during the thirty (30) days notice period Airline institutes additional flights, aircraft arrivals and
departures for the purpose of loading and unloading passengers, which would exceed the number
flights in place by the secondary user, then Airline may retain Preferential Use of its Concourse Gate
Position,
Airport Use and Lease Agreement 44 Dated 07/01/94
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(B) Cessation of Use. If Airine ceases to operate for more than sixty (60) consecutive
days during the months of November through May ("peak season"), then City may cancel this
Agreement and terminate all of its obligations hereunder by giving Airline at least thirty (30) days prior
written notice.
Airline is considered to have ceased operations during peak season when Airline has no aircraft
scheduled for arrival or departure at Airline's Concourse Gate Position(s), for the purpose of loading
and unloading passengers, for a period of more than sixty(60) consecutive days, unless said cessation
of operations is due to a force majeure or a labor strike.
Section 19.04 Cancellation by Airline
In addition to the rights of cancellation granted heretofore in this Agreement, Airline shall have
the right to cancel this Agreement in its entirety and all rights ensuing therefrom upon the occurrence
of any of the following:
(a) The Airline provides three (hundred sixty four (364) days written notice to City.
(b) The withdrawal, suspension or termination by the Civil Aeronautics Board or its
successor Federal Agency, and/or the State of California Public Utilities Commission, or its successor
State Agency, of the permit or authorization required by the law permitting or authorizing Airline to
operate to and from the Airport; provided, however, that none of the foregoing is due to any fault of
Airline;
(c) The issuance of any order, rule or regulation by the Federal Aviation Administration, the
California Public Utilities Commission, or its or their successor Federal or State Agency of any other
governmental agency having jurisdiction, or the issuance and execution of any judicial process by any
court of competent jurisdiction materially restricting for a period of at least sixty (60) days the use of
the Airport for scheduled Air Transportation; provided, however, that none of the foregoing is due to
any fault of Airline;
(d) The material restriction of City's operation of the Airport by action of the Federal
Government, or any department or agency thereof, under its wartime or emergency powers, and the
continuance thereof for a period of not less than sixty (60) days; provided, however, that without
prejudice to the rights of Airline to cancel as above provided, the parties hereto may mutually agree
to a just abatement of fees and charges accordingly as their respective rights are affected; and
Airport Use and Lease Agreement 45 Dated 07/01/94
(e) The material restriction of Airline's use of the Premises and facilities herein and the
continuance thereof for a period of not less than sixty (60) days by reason of any future agreement
between the City and the United States.
ARTICLE XX
DAMAGE OR DESTRUCTION
Section 20.01 Damage or Destruction of Premises
A. Partially Insured Casualty. If the Premises or the Airport shall be partially damaged by
fire or other casualty required to be insured by City pursuant to Section 12.05, then upon City's receipt
of the insurance proceeds, City shall, except as otherwise provided in this section, promptly repair and
restore the same (exclusive of Airline's leasehold improvements, alterations or additions, trade fixtures,
signs or other personal property) substantially to the condition thereof immediately prior to said
damage or destruction, limited, however, to the extent of the insurance proceeds actually received by
City therefor.
B. Substantial and Uninsured Casualty. If (a) both the Premises and the buildings
constituting the Airport shall be damaged to the extent of fifty percent (50%) or more of the cost of
replacement thereof or (b) the Premises or the buildings constituting the Airport shall be destroyed or
damaged as a result of a risk not required to be insured by City pursuant to 12.05 hereof, or (c) the
Premises shall be damaged to the extent of twenty-five percent (25%) or more of the cost of
replacement thereof during the last two (2) years of the term of this Agreement, or (d) the buildings
constituting the Airport shall be damaged to the extent of fifty percent (50%) or more of the cost of
replacement thereof, whether or not the Premises shall be damaged, then in any such events, City
may elect either to repair the damages as aforesaid, or to cancel this Agreement by written notice of
cancellation given to Airline within ninety (90) days after the date of such occurrence, and thereupon
this Agreement shall cease and terminate twenty (20) days following Airline's receipt of such notice;
and Airline shall vacate and surrender the Premises to City in accordance with the terms of this
Agreement. In determining the cost of replacement of the Premises or any building or improvement,
the cost of foundations and footings shall not be included, except to the extent of the cost of repair
thereto required by such damage or destruction.
C. Reconstruction. In the event of any reconstruction of the Premises or the Airport under
this Section, said reconstruction shall be performed by City's contractor. Airline, at its sole cost and
Airport Use and Lease Agreement 46 Dated 07/01/94
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expense, shall be responsible for the replacernent of its signs, stock in trade, trade fixtures, furniture,
furnishings and equipment. Airline shall commence such installation of fixtures, equipment and
merchandise promptly upon delivery to Airline of possession of the Premises and shall diligently
prosecute such installation to completion.
D. Termination. Upon any termination of this Agreement under any of the provisions of this
Section, the parties shall be released thereby without further obligation to the other party coincident
with the surrender of possession of the Premises to City, except for items which have theretofore
accrued and be then unpaid and for Airline's removal of fixtures, signs and other personal property
under Section 17.01.
E. Abatement of Airline Rates and Charges In the event of repair, reconstruction and
restoration to the Premises by City as to be paid under Sections 5.02 and 5.03 hereof shall be abated
proportionately with the degree to which Airline's use of the Premises is impaired commencing from
the date of destruction and continuing during the period of City's repair, reconstruction or restoration
of the Premises. Airline shall continue the operation reasonably practicable from the standpoint of
prudent business management, and the obligation of Airline to pay Landing Fees and other Airline
rates and Charges shall remain in full force and effect. Airline shall not be entitled to any
compensation for damages from City for loss of the use of the whole or any part of the Premises, the
building of which the Premises are a part, or Airline's personal property or any inconvenience or
annoyance occasioned by such damage, repair, reconstruction or restoration.
F. Waiver. Airline hereby waives any statutory rights of termination which may arise by
reason of any partial or total destruction of the Premises which City is obligated to restore or may
restore under any of the provisions of this Agreement.
ARTICLE XXI
PROHIBITED USES
Section 21.01 Prohibited Uses
Airline shall not do or permit anything to be done in, on, or at the Airport which will in any way
conflict with any law, or ordinance of any governmental agency, or with the City's rules and regulations
provided for in Article XV herein, or create a nuisance or in any way obstruct or interfere with the rights
of other users of the Airport, or damage any property or persons thereon, or endanger the health and
safety of persons using the Airport.
Airport Use and Lease Agreement 47 Dated 07/01/94
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Section 21.02 Oil, Fuel and Other Materials
Airline agrees to prevent the entry/ of oil, fuel or other prohibited materials that are under its
control into the drainage system of Airport or into the drainage system of any of its surrounding
communities, unless such materials are first properly treated by equipment installed with the approval
of City for that purpose, and Airline complies with recommendations made by the Environmental
Protection Agency. "Drainage system(s)" shall include among other things, the sewer system and
ground water. Airline will bear all costs related to prohibited entry of such oil, fuel or other materials
into said drainage systems.
Section 21.03 Compliance with Laws
Airline 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 Premises, and shall faithfully observe in said use all municipal ordinances, including, but not limited
to, the General Plan and zoning ordinances, state and federal statutes or other governmental
regulations now in force or which shall hereinafter be in force, except that in complying with the law,
Airline shall not be held responsible for any structural changes to the terminal building. Airline's
violation of law shall constitute an incurable default under this Agreement. The judgment of any court
of competent jurisdiction, or the admission of Airline in any action or proceeding against Airline,
whether City be a party thereto or not, that Airline has violated any such order or statute in said use,
shall be conclusive of that fact as between the City and Airline.
Airline shall not engage in any activity on or about the Premises that violates any Environmental
Law, and shall promptly, at Airline'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 Airline. 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 Premises, including, without limitation, (i) the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Sections 9601 et seq.; (ii) the
Resource Conservation and Recovery Act of 1976 ("RCRA") 42 U.S.C. Sections 6901 et seq.; (iii)
California Health and Safety Code Sections 25100 et seq.; (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 25915; (vii)
Airport Use and Lease Agreement 48 Dated 07/01/94
the Federal Water Pollution Control Act, 33 U.S.C. Sections 1317 et seq.; (viii) California Water Code
Section 1300 et seq.; (ix) California Civil Code Section 3479 et seq., 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 (i) 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 of 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. Airline shall provide all
notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California
Health and Safety Code Section 25249 et seq. Airline shall provide prompt written notice to City of
all notices of violation of the Environmental Laws received by Airline.
ARTICLE XXII
IMPROVEMENTS
Section 22.01 Improvements by Airline
Airline may, at it expense and subject to the provisions of Section 22.02 hereof, design,
construct and install in Airline's Exclusive Use Space any additional interior partitions, walls other than
structural building walls, electrical wiring, conduits, ducts, fixtures and equipment, wall and floor
coverings including all special flooring, paunting and decor, counters, cabinet work and equipment as
may be required by Airline and which is not provided by City. Airline shall have the right to install at
its expense and subject to the provisions of Section 22.02 hereof, in the conduit and ducts provided
by City in the basic building structure, the wiring and other equipment necessary for Airline's internal
Communications system and the further right to attach and maintain, at it expense, on the vertical sides
of the terminal building, a communications antenna.
Section 22.02 Conditions Covering Improvements and Alterations
(A) Consent Required from City. No improvements, alterations or additions including
repainting, redecorating and recarpeting shall be made in or about Airline's Existing or Future
Exclusive Use Space by Airline without first obtaining written consent of the Director of Aviation. All
such improvements, structure, alterations, additions and work shall be in full accordance with all written
conditions prescribed by the Director of Aviation. Prior to the construction of any improvements
Airport Use and Lease Agreement 49 Dated 07/01/94
mentioned in Section 22.01 above, Airline shall submit to the Director of Aviation for his review and
approval, the plans of such improvements, including the color of all paint and carpet. Such plans shall
conform to the general architectural scheme and overall plans adopted by the City for the Terminal
Building Complex.
(B) Working Drawings. Upon approval by the Director of Aviation of Airline's plans,Airline
shall cause the construction called for by said plans to be commenced and completed with reasonable
dispatch. Upon completion of any improvement, Airline shall furnish to City, at no charge, a complete
set of working drawings of the improvement as constructed.
(C) Conformance. All improvement constructed by Airline in the Airline's Existing or Future
Exclusive Use Space including the plans and specification therefor, shall conform in all respects to the
applicable statutes, ordinances, building code, rules and regulations of the City of Palm Springs and
such other governmental authority as may have jurisdiction. City's approval given, as provided for in
this Section 22.02, shall not constitute a representation or warranty as to such conformity which shall
remain Airline's responsibility. Airline, at its own cost and expense, shall procure all permits necessary
for such construction.
(D) Airline's Cost and Expense. All renovation or construction by Airline pursuant to this
Section 22.02 shall be at Airline's sole cost and expense. Airline shall keep its Existing or Future
Exclusive Use Space and the improvements constructed thereon free and clear of all liens and shall
pay all costs for labor and material arising out of such construction and shall hold City harmless from
any liability in respect thereto. Airline shall have the right to contest any and all liens filed against its
Existing or Future Exclusive Use Space. Airline further agrees that City shall have the right to post
notices of non-responsibility as provided by Sections 3094 and 3129 of the Civil Code of the State of
California.
(E) No Structural Alteration. Airline shall make no structural alterations to the roof, walls,
or floors of any of City's permanent structures in which Airline's Existing or Future Exclusive Use
Space is located without first obtaining City's written consent. Nothing contained this Section 22.02
shall prevent Airline from making non-structural alterations to any improvements pursuant to this
Section 22.02.
Section 22.03 Ownership of Improvements
Any and all improvements, alterations, or additions erected or installed by Airline upon the
Airline's existing or future Exclusive Use :Space shall become a part of the land on which they are
Airport Use and Lease Agreement 50 Dated 07/01/94
erected and title thereto shall thereupon vest in City upon the expiration or sooner termination of this
Agreement. However, machines, baggage conveyor equipment, trade fixtures and similar installations
of the type commonly installed in and removed from other airport terminal facilities by tenants, which
are installed in or on the Premises, shall not be deemed to be a part of the realty even though they
are attached to the floors, walls or roof of the buildings or to outside pavements so long as they can
be removed without structural damage to the buildings or pavements; provided, however, that if the
removal of any such installation damages any part or parts of the buildings, pavements, or Premises,
Airline shall repair such damage and restore said damaged part or parts of said building, pavements,
or Premises to the condition in which they existed prior to the installation of said improvements.
ARTICLE XXIII
FEDERAL GRANTS AND NON-DISCRIMINATION
Section 23.01 Non-Discrimination and FAA Required Clauses
Airline, for itself, heirs, personal representatives, successors in interest, and assigns, as a part
of the consideration hereof, does hereby covenant and agree as a covenant running with the Premises
that, in the event facilities are constructed maintained, or otherwise operated on the said Premises
described in this Agreement for a purpose for which a Department of Transportation (DOT) program
or activity is extended or for another purpose involving the provision of similar services or benefits,
Airline shall maintain and operate such facilities and services in compliance with all other requirements
imposed pursuant to Title 49, Code of Federal Regulations, DOT, Subtitle A, Office of the Secretary,
Part 21, Nondiscrimination in Federally- Assisted Programs of the Department of Transportation-
Effectuation of Title VI of the Civil Rights Act of 1964, and as said Regulations may be amended.
Airline, for itself, personal representatives, successors in interest, and assigns, as a part of the
consideration hereof, does hereby covenant and agree as a covenant running with the Premises that:
(1) no person on the grounds of race, color, or national origin shall be excluded from participation in,
denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities; (2) in
the construction of any improvements on, over, or under such Premises and the furnishing or services
thereon, no person on the grounds of race, color, or national origin shall be excluded from participation
in, denied the benefits of, or otherwise be: subjected to discrimination; and (3) Airline shall use the
Premises in compliance with all other requirements imposed by or pursuant to Title 49, Code of
Federal Regulations, Department of Transportation, Subtitle A, Office of the Secretary, Part 21,
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Nondiscrimination in Federally-Assisted Programs of the Department of Transportation-Effectuation of
Title VI of the Civil Rights Act of 1964, as said Regulations may be amended.
In the event of breach of any of the above nondiscrimination covenants, City shall have the right
to terminate the Agreement and to re-enter and repossess said Premises and the facilities thereon,
and hold the same as if an agreement had never been made or issued. This provision does not
become effective until the procedures of 49 CFR Part 21 are followed and completed including
expiration of appeal rights.
Airline shall furnish its services on a fair, equal and not unjustly discriminatory basis to all users
thereof and it shall charge fair, reasonable and not unjustly discriminatory prices for each unit or
service; provided Airline may be allowed to make reasonable and nondiscriminatory discounts, rebates
or other similar type of price reductions to volume purchasers.
Noncompliance with the preceding paragraph shall constitute a material breach thereof and,
in the event of such noncompliance, City, shall have the right to terminate this Agreement and the
leasehold interest hereby created without liability therefore or, at the election of City or the Untied
States, either or both said Governments shall have the right to judicially enforce Provisions.
Airline agrees that it shall insert the provisions in the five preceding paragraphs in any
agreement by which Airline grants a right or privilege to any person, firm or corporation to render
services to the public on the Airport.
Airline assures that it will undertake an affirmative action program as required by 14 CFR Part
152, Subpart E, to insure that no person, on the grounds of race, creed, color, national origin, or sex
be excluded from participating in any employment activities covered in 14 CFR Part 152, Subpart E.
Airline assures that no person shall be excluded on these grounds from participating in or receiving
the services or benefits of any program or activity covered by this subpart. Airline assures that it will
require that its covered suborganizations provide assurances to Airline that, similarly, they will
undertake affirmative action programs and that they will require assurances from their suborganizations
to the same effort, as required by 14 CFR 152, Subpart E.
City reserves the right to further develop or improve the landing area of the Airport as it sees
fit regardless of the desires or view of Airline and without interference or hindrance.
City reserves the right, but shall not be obligated to Airline, to maintain and keep in repair the
landing area of the Airport and all publicly-owned facilities of the Airport, together with the right to
direct and control all activities of Airline in this regard.
Airport Use and Lease Agreement 52 Dated 07/01/94
• •
This Agreement shall subordinate to the provisions and requirements of any existing or future
agreement between City and the United States, relative to the development, operation or maintenance
of the Airport.
There is hereby reserved to City, its successors and assigns, for the use and benefit of the
public, a right of flights for the passage of aircraft in the airspace above the surface of the Airport
herein. This public right of flight shall include the right to cause in said airspace any noise inherent
in the operation of any aircraft used for navigation or flight through the said airspace or landing at,
taking off from, or operation on the Airport.
Airline agrees to comply with the notification and review requirements covered in Part 77 of the
Federal Aviation Regulations in the event future construction of a building is planned for the Airport,
or in the event of any planned modifications or alterations of any present or future building or structure
situated on the Airport.
Airline, by accepting this Agreement, expressly agrees for itself, its successors and assigns that
it will not erect nor permit the erection of ainy structure or object, nor permit the growth of any tree on
the land leased hereunder above the mean sea level elevation of 600 feet. In the event the aforesaid
covenants are breached, City reserves the right to enter upon the Premises and to remove the
offending structure or object and cut the offending tree, all of which shall be at the expense of Airline.
Airline, by accepting this Agreement, agrees for itself, its successors and assigns that it will not
make use of the Airport in any manner which might interfere with the landing and take off of aircraft
from the Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached,
City reserves the right to enter upon the Premises hereby leased and cause the abatement of such
interference at the expense of Airline.
It is understood and agreed that nothing contained shall be construed to grant or authorize the
granting of an exclusive right within the meaning of Section 308a of the Federal Aviation Act of 1958
(49 U.S.C. 1349a).
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 and taking over of said Airport or the exclusive or nonexclusive use of the Airport by the
United States during the time of war or national emergency.
Airport Use and Lease Agreement 53 Dated 07/01/94
Section 23.02 Federal Grants
This Agreement shall be subordinate to the provisions of any existing and future agreements
between the City and the United States of America, its boards, agencies, or commissions, relative to
the operation or maintenance of the Airport, the execution of which has been, or will be, required as
a condition to the expenditure of federal funds for the development of the Airport.
ARTICLE XXIV
CONDEMNATION
Section 24.01 Condemnation
A. Total Taking. In the event the entire Premises shall be appropriated or taken under the
power of eminent domain by any public or quasi-public authority, this Agreement shall terminate and
expire as of the date of such taking, and City and Airline shall each thereupon be released from any
liability thereafter accruing hereunder.
B. Substantial Taking. In the event more than twenty percent (20%) of the square footage
of the Premises is taken under the power of eminent domain by any public or quasi-public authority,
or if by reason of any appropriation or taking, regardless of the amount so taken, the remainder of the
Premises is not useable for Air Transportation, either City or Airline shall have the right to terminate
this Agreement as of the date Airline is required to vacate a portion of the Premises, upon giving notice
in writing of such election within thirty (30) days after receipt by Airline from City of written notice that
said Premises have been so appropriated or taken. City agrees immediately after learning of any
appropriation or taking to give to Airline notice in writing thereof.
C. Right to Award. If this Agreement is terminated in either manner hereinabove provided,
City shall be entitled to the entire award or compensation in such proceedings. Airline's right to
receive compensation or damages for its fixtures and personal property shall not be affected in any
manner hereby.
D. Restoration. If both City and Airline elect not to so terminate this Agreement, or if
neither has the right to so terminate this .Agreement following any such taking, then in either such
event City agrees, at City's cost and expense, to the extent of any severance damages attributable to
damages to the Premises available to City, to as soon as reasonably possible restore the Premises
on the land remaining to a complete unit of like quality and character as existed prior to such
appropriation or taking.
Airport Use and Lease Agreement 54 Dated 07/01/94
0 0
E. Voluntary Sale; Waiver. For the purposes of this Section, a voluntary sale or
conveyance in lieu of condemnation shall be deemed an appropriation or taking under the power of
eminent domain. Airline hereby waives any statutory rights of termination which may arise by reason
of any partial taking of the Premises under the power of eminent domain.
ARTICLE XXV
MISCELLANEOUS
Section 25.01 Non-Waiver of Rights
Continued performance by either party hereto pursuant to the terms of this Agreement after a
default in any of the terms, covenants and conditions herein contained to be performed, kept or
observed by the other party hereto, shall not be deemed a waiver of any right to cancel this Agreement
for any Subsequent default and no waiver of any such default shall be construed, or act as a waiver
of any subsequent default.
Section 25.02 Invaliditv of Clauses
The invalidity of any Article, Section, portion, paragraph, provision, or clause of this Agreement
shall have no effect upon the validity of any other part or portion hereof.
Section 25.03 Approval by the Parties
Whenever the consent or approval of the City or the Airline is called for herein, it is understood
and agreed that such approval shall be in writing and obtained in advance and shall not be
unreasonably withheld or delayed.
Section 25.04 Headings
The Article and Section titles shown in this Agreement are included only as a matter of
convenience and for reference and in no way define, limit, broaden or describe the scope or intent of
any provisions of this Agreement.
Section 25.05 Remedies
The rights and remedies given to the City and Airline in this Agreement are distinct, separate
and cumulative, and no one of them, whether or not exercised by either party, shall be deemed to be
in exclusion of any of the others herein or by law or in equity provided.
Section 25.06 Governing Law
The parties hereto agree that this Agreement shall be governed and construed in accordance
with the laws of the State of California.
Airport Use and Lease Agreement 55 Dated 07/01/94
Section 25.07 Non-Liability
No board member, Commissioner, director, officer, agent, consultant or employee of the City
or Airline shall be charged personally or be held liable by or to the other party under any term or
provision of this Agreement, or any amendment thereto, or because of any breach hereof, or because
of its execution.
Section 25.08 Attorneys' Fees and Costs
In the event any action or suit or proceeding is brought by either party to collect the fees and
charges due or to become due hereunder or any portion thereof or to take possession of said
Premises or to enforce compliance with this Agreement for failure to observe any of the covenants of
this Agreement, and such party is successful in such action, suit or proceeding, the losing party agrees
to pay such sums as the Court may judge reasonable attorneys' fees and costs to be allowed in said
suit, action or proceeding.
Section 25.09 Notices
(a) Any request, demand, authorization, direction, notice, consent or waiver provided or
permitted to be made upon, given by, or furnished to, the City or Airline shall be sufficient for every
purpose hereunder if in writing and mailed by certified or registered mail, postage prepaid and
addressed as follows:
(1) if to the City, at: Palm Springs Regional Airport
3400 East Tahquitz Canyon Way
Palm Springs, CA 92262
Attention: Allen F. Smoot, A.A.E., Director of Aviation
(2) if the Airline, at: Trans World Airlines, Inc
One City Centre
515 North 6th Street
St. Louis, MO 63101
**
Attention: Corporate Secretary
The foregoing addresses may be changed by either party giving to the other party the same
type of notice described above providing a substitute address.
(b) Any such notice or other document shall be deemed to be received as of three days after
the date deposited in the mail, if mailed in accordance with subsection (a) of this Section.
** (with a copy to) Staff Vice President, Properties & Facilities
If by Overnight Delivery: If by U.S. Mail :
Trans World Airlines, Inc. Trans World Airlines, Inc. , Ground Ops. Center,
10900 Lambert Intl . Blvd. P. 0. Box 10007, Lambert-St. Louis Intl . Airport,
Bridgeton , MO 63044 St. Louis, MO 63145
Airport Use and Lease Agreement 56 Dated 07/01/94
0 0
Section 25.10 Termination of Prior Agreement
City and Airline agree that the Airline Use Agreement for Palm Springs Regional Airport as
amended ("Prior Agreement'), and expiring on , 1994, is terminated as of the Effective
Date of this Agreement.
Section 25.11 Exhibits
All Exhibits attached to this Agreement are incorporated herein by this reference.
Section 25.12 Agreement Not to Grant More Favorable Terms
Subject to the other provisions of this Section 24.13, City agrees not to enter into any lease,
contract or other agreement with any other Aircraft Operator engaged in Air Transportation containing
more favorable terms than this Agreement, or to grant to such Aircraft Operator rights or privileges
with respect to the Airport that are not accorded Airline hereunder, unless the same rights, terms and
privileges are concurrently made available: to Airline. Notwithstanding the foregoing, it is understood
and agreed that rentals and fees charged for terminal buildings, associated gate positions, ramp areas,
and other facilities constructed in the future and not described in this Agreement may vary from the
fees and charges established herein for the premises depending upon the capital cost and financing
arrangements involved, and therefore may be more or less than the fees and charges established
herein for similar facilities.
In the event an Aircraft Operator shall use the facilities or any services of the Airport without
first executing an agreement with City substantially identical to this Agreement, such Aircraft Operator
shall pay rentals, fees and other charges computed at rates established by the City which are not less
than those applicable to Airline as provided hereunder.
Section 25.13 Entire Agreerent
This Agreement, together with all Exhibits and Appendices hereto, constitutes the entire
agreement between the parties hereto relating to the subject matter hereof and may be amended only
in writing, executed by duly authorized representatives of the party to be bound.
Section 25.14 Invalidity of Covenants Conditions or Provisions
In the event any covenant, condition or provision herein is held to be invalid by final judgement
of any court of competent jurisdiction or any governmental agency, the invalidity of such covenant,
condition or provision shall not in any way affect any other covenant, condition or provision herein.
Airport Use and Lease Agreement 57 Dated 07/01/94
0 a
Section 25.15 Jurisdiction and Venue
The parties hereto agree that the State of California is the proper jurisdiction for litigation of any
matters relating to this Agreement, and service mailed to the address of airline set forth herein shall
be adequate service for such litigation. The parties further agree that Riverside County, California is
the proper place for venue as to any such litigation and Airline agrees to submit to the personal
jurisdiction of such court in the event of such litigation.
Section 25.16 No Oral Agreements
This Agreement (i) covers in full each and every agreement of every kind or nature whatsoever
between the parties hereto concerning this Agreement, (ii) supersedes, any and all previous
obligations, agreements and understandings, if any, between the parties, oral or written, and (iii)
merges all preliminary negotiations and agreements of whatsoever kind or nature herein. Airline
acknowledges that no representations or warranties of any kind or nature not specifically set forth
herein have been made by City or its agents or representatives.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and
year first written above.
CITY OF PALM SPRINGS, a Municipal Corporation
ATTEST:
City Clerk —g44hMAnagerro
y
Approved as to Form
RUTTAN & TUCKER
IN J. Aleshire
ty Attorney
TRANS WORLD AIRLINES INC.
(AIRLINE)
By
Sl'e5SFVICEPREES??�"iT
Its:
r. -y
Airport Use and Lease Agreement 58 Dated 07/01/94
EXHIBIT A
LANDSIIDEITERMINAL/AIRSIDE
IT
RBIfz\� �' ti9
AIRSIDE
-
® TERMINAL
LANDSIDE
I '
EXHIBIT B
Page 1 of 3
EXCLUSIVE USE SPACE
Lu
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EXHIBIT B
Page 2 of 3
JOINT USE BAGGAGE CLAIM/COMMON AREAS
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i
EXHIBIT B
Page 3 of 3
JOINT USE WALKWAY
00
� a
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S
V 0
EXHIBIT C
EXCLUSIVE USE SPACE
SPACE SQ.FT.
1 Exclusive 2453.0
Outbound 0
2 Exclusive 1208.0
Outbound 900.0
3 Exclusive 562.5
Outbound 450.0
4 Exclusive 562.5
Outbound 450.0
5 Exclusive 562.5
Outbound 450.0
6 Exclusive 609.0
Outbound 450.0
7 Exclusive 1639.0
Outbound 450.0
8 Exclusive 821.0
Outbound 450.0
9 Exclusive 286.0
Outbound 136.0
Airline hereby elects to
2 lease the following space(s):
Office Space shaded in gray.
J_ This space does not include
�— outbound baggage make-up area.
3
" 317 sq.ft. Total.
-----------------------
6
7
8
9"
Note: This section is Minter space and front office only.
0
EXHIBIT D
FIRST LEVEL CONCOURSE BUILDING
a°
a
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f �000
1
0
EXHIBIT E
SECOND LEVEL CONCOURSE BUILDING
0
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moo'.
o000
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0
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EXHIBIT F
AIRPORT TERMINAL DEVELOPMENT PROGRAM
Construction of an air-conditioned concourse with eight (8) second level passenger boarding bridges.
The use of a tensile fabric construction on the concourse will protect the main circulation areas from
the elements,while providing opportunities for natural ventilation, shade and illumination. Development
of expanded opportunities for concessions as well as an outdoor patio area. Construction of a central
utility plant and expanded airside tenant operations areas on the apron level.
• 0
EXHIBIT G
MAINTENANCE AND OPERATIONS RESPONSIBILITIES
Area/Item Responsibility
Airport Airline
Aircraft Parking Ramp
Pavement Maintainence X
Striping X
Sweeping X
Fuel Spill Cleanup X
Airline Exclusive Use Space
Exterior Shell/Structure X
Access Control X
Airline Security Control X
Janitorial X
General Electrical/Mechanical X
Light Bulbs X
Interior Painting X
Carpeting X
Ticket Counter Shell X
Ticket Counter Inserts X
Security Checkpoint
Equipment X
Cabinetry X
Custodial X
Checkpoint Office Custodial X
Boarding Gate Areas
Counters/Inserts X
Signage (Directional) X
Arrival and Departure Boards X
Public Address System X
Commuter Gates 9 - 11 Counter Shells X
Commuter Gates 9 - 11 Counter Inserts X
Hold Rooms
Custodial X
Furniture X
EXHIBIT H
SUPPLEMENTAL SPACE
Airline elects to lease Supplemental Space. Said Supplemental Space Lease shall become
effective and shall run until airline elects to lease the
following space:
Type Space Sg.Ft. Rate
Office Trailer Space Same as "Exclusive Use"
Sq.Ft. Rate
Upstairs Offices $25.21/Sq.Ft./Annum
Open Storage Space /Sq.Ft./Annum
Descriptive information about the space leased is as follows:
Airline
Dated
EXHIBIT I
PREFERENTIAL USE OF CONCOURSE GATE POSITIONS
All assignment of Concourse Gate Positions shall be made in strict accordance with reasonable
rules, regulations and directives adopted and promulgated by City, consistent with this Agreement.
The Director of Aviation, in making preferential but nonexclusive assignment of gate positions to
Aircraft Operators, shall take into account the needs and requirements of Airline for use of Concourse
Gate Positions.
Preferential Use of Concourse Gate Positions
Airlines who are a Signatory Airline as of the Effective Date may be guaranteed Preferential
Use of the Gate Position(s) as follows:
1. Preferential Use of One Gate Position for each Airline.
2. If an Airline had (during the preceding January) regularly scheduled daily operations
which required simultaneous use of at least two Gate Positions, at least three times
daily, the Preferential Use of a Second Gate Position, at all times; for as long as the
simultaneous use of two gates three times a day is required.
3. If an Airline had (during the preceding January) regularly scheduled daily operations
which required simultaneous use of at least two Gates Position but less than three times
a day, the Preferential Use of a Second Gate Position during the time frame(s)
coinciding with the scheduled times of the flights requiring the use of the second
concourse Gate Position; for as long as the simultaneous use of two gates is required.
4. If an Airline has qualified for two Preferential Concourse Gate Positions pursuant to
subparagraph 2 above and had (during the preceding January) regularly scheduled daily
operations which required simultaneous use of three Concourse Gate Positions, the
Preferential Use of a third Concourse Gate Position during the time frame(s) coinciding
with the scheduled time(s) of the flights requiring the use of the third Concourse Gate
Position for as long as the simultaneous use of three concourse gate positions is
required.
A "time frame" as referred to above shall mean the Scheduled Departure or Arrival Time as
published on the preceding January; or as may thereafter be changed as follows:
1. A one hour adjustment in conjunction with time zone change from Standard Time to
Daylight Savings Time, and/or;
M a
2. An adjustment of a particular schedule by no more than one half hour before or one half
hour after the schedule published on the preceding January.
The City retains the right to permit other Aircraft Operators ("itinerant operators") to use one
or more of Airline's Concourse Gate Position(s) (or component thereof) when they are not required by
Airline. However, Airline will not be required to make such Concourse Gate Positions(s) available to
an itinerant operator if a Concourse Gate Position(s) (or component thereof) not preferentially used
by another Aircraft Operator and meeting all necessary and reasonable requirements of the City is
available during the time period involved or if the use by the itinerant operator is projected to conflict
with the scheduled arrival or departure of Airline's aircraft using such Concourse Gate Position(s) (or
component thereof). Airline will not be required to move its aircraft from any of its Aircraft Parking
Position(s) if an unoccupied Aircraft Parking Position(s) is available during the time period involved.
In determining which Concourse Gate Position (or component thereof) will be assigned to the itinerant
operator, City shall consider the flight schedules of all Aircraft Operators using the Terminal Building
Complex.
Whenever Airline is required to move its aircraft from an Aircraft Parking Position pursuant to
this Section, the City shall provide paved aircraft parking space in a reasonably convenient area of the
Airport designated by the City for such purposes to accommodate such removed aircraft, at no
additional charge for the aircraft parking space.
When practicable, City shall require that any such itinerant operator, as a condition precedent
to using any of Airline's Concourse Gate Positions (or components thereof), execute an agreement
containing indemnity and liability insurance provisions substantially similar to those set out in Article
XII of this Agreement, which will protect Airline from liabilities, losses, suits, claims, judgments, fines,
and demands arising out of or in connection with the itinerant operator's use of such Concourse Gate
Positions.
Preferential Use of Commuter Concourse Gate Positions
The Commuter Concourse Gate Positions are intended to be used by Aircraft Operators
operating aircraft with thirty four (34) seats or less, as prescribed by City. The assignment of aircraft
with more than thirty four (34) seats to the First Level Concourse Gate Positions shall be at the sole
option of the City. The Director of Aviation; in making preferential but Non-Exclusive assignment of
gate positions to aircraft operators, shall take into account the needs and requirements of Airline for
use of concourse Gate Positions. Signatory Airlines as of July 1, 1994 shall be guaranteed one
preferential use Gate Position. Signatory airlines as of July 1, 1994, operating more than 12 flights
per day in the preceding January, shall be allocated two Preferential Use Commuter Concourse Gate
0 a
Positions. Commuter Concourse Gate Positions remaining shall be assigned at the sole option of the
City.
Order of Selection
Gate position order of selecton shall be based upon a point system derived from individual
percentages of Enplaned Passengers, number of landings and seniority. These categories shall be
weighted as follows: Enplaned Passengers - 45%, number of landings - 45% and seniority - 10%.
Trans World Airlines, Inc.
*tandard Airport Use & Lease
AGREEMENT #3881
CM Signed, 12-15-97
STANDARD FORM 93-001A
AIRPORT USE AND LEASE AGREEMENT
PALM SPRINGS REGIONAL AIRPORT
Dated July 1, 1994
Between
CITY OF PALM SPRINGS
PALM SPRINGS, CALIFORNIA
and
TRANS WORLD AIRLINES, INC.
[Airline]
TABLE OF CONTENTS
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01 Aircraft Loading Bridge(s) or AC Loading Bridge(s) . . . . . . . . . . . . . . . . . . . 2
Section 1.02 Aircraft Operator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.03 Aircraft Parking Position(s) or AC Parking Position(s) . . . . . . . . . . . . . . . . . 2
Section 1.04 Airline Funded Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.05 Airline Rates and Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section1.06 Airport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.07 Airport Improvement Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.08 Airport Layout Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.09 Airport Terminal Development Program or Programs . . . . . . . . . . . . . . . . . 2
Section 1.10 Airside Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.11 Airside Cost-Revenue Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.12 Capital Expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.13 Capital Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.14 Certificated Maximum Landing Weight . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section1.15 Concession Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section1.16 Concourses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.17 Concourse Gate Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.18 Cost-Revenue Centers or CRCs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.19 Date of Beneficial Occupancy or DBO . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.20 Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.21 Director of Aviation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.22 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.23 Enplaned or Enplaning Passengers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.24 Exclusive Use Space . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.25 Exclusive Use Space Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.26 Existing Joint Use Baggage Claim/Common Area . . . . . . . . . . . . . . . . . . . . 5
Section 1.27 Existing Joint Use Walkway . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.28 Expiration Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.29 FAA or Federal Aviation Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section1.30 Fee Landing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.31 First Level Concourse Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section '1.32 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section1.33 Independent Accountant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 1.34 Indirect Cost Pool . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 1.35 Joint Use Formula . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section1.36 Landing Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.37 Landing Fee Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section1.38 Landside Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.39 Landside Cost-Revenue Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.40 Main Terminal Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.41 Maintenance and Operations Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 1.42 Maintenance and Operations Reserve Fund . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 1.43 Non-Airline Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 1.44 Passenger Departure Lounge(s) on the First Level Concourse . . . . . . . . . . 9
Section 1.45 Preferential Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 1.46 Preferential Use Space . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section1.47 Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section1.48 Reserve Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1.49 Second Level Concourse Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1.50 Signatory Airline(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1.51 Special Capital Projects Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1.52 Terminal Area or Terminal Building Complex . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1.53 Terminal Cost-Revenue Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Airport Use and Lease Agreement Dated 07/01/94
Section 1.54 Total Landed Weight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.01 Term of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLEIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.01 Rights of Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.01 Period From Effective Date to DBO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.02 Period From DBO Until Expiration Date of This Agreement . . . . . . . . . . . . . 15
ARTICLEV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.01 General Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.02 Period From Effective Date to DBO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.03 Period From DBO Until Expiration Date of This Agreement . . . . . . . . . . . . 16
Section 5.04 Landing Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 5.05 Supplemental Space . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 5.06 Special Capital Projects Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 5.07 Employee Ground Vehicle Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 5.08 Insufficiency of Airport Revenues, Adjustment of Airline Rates and Charges 18
Section 5.09 Annual Adjustment to Actual Airline Rates and Charges . . . . . . . . . . . . . . . 19
Section 5.10 Costs Excluded . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.11 Other Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.12 Non-Signatory Airlines Rates and Charges . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.01 Maintenance and Operations Expenses, Reserve Fund Deposit Requirements
and Non-Use Agreement Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.02 Disposition of Airport Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.03 Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.04 Maintenance and Operations Reserve Fund . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.05 Landside Development Reserve Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE VII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 7.01 Preliminary Projection of Airline Rates and Charges . . . . . . . . . . . . . . . . . . 22
Section 7.02 Payment of Airline Rates and Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 7.03 Late Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 7.04 Provision Against Set-Offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 8.01 General Concepts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 8.02 Accounting Principles and Audit Report . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 8.03 Cost or Expense Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 8.04 City to Exercise Prudence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 8.05 Additional Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 8.06 Airline Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 8.07 Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 8.08 Bonded Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 8.09 Outside Storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLEIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 9.01 Approval of Airport Terminal Development Program . . . . . . . . . . . . . . . . . . 27
Section 9.02 Sources of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 9.03 Airline Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 10.01 Maintenance and Operation of the Premises . . . . . . . . . . . . . . . . . . . . . . 28
Section 10.02 Maintenance and Operation of Airport by City . . . . . . . . . . . . . . . . . . . . . . 29
Section 10.03 Accommodations of Other Incoming Aircraft Operators . . . . . . . . . . . . . . . 29
Section 10.04 Gate Positions and Loading Ramps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 10.05 Aircraft Parking Position(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Airport Use and Lease Agreement ii Dated 07/01/94
Section 10.06 Public Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section10.07 Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 10.08 Alteration, Repair, Maintenance, Remodeling, Expansion, Removal and/or
Improvement of the Facilities of Terminal Building Complex or Its
Appurtenances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 10.09 Airport Security - Federal Aviation Regulations . . . . . . . . . . . . . . . . . . . . . 31
Section 10.10 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 10.11 Trash, Garbage, Aircraft Sewage and Other Refuse . . . . . . . . . . . . . . . . . 33
Section 10.12 Vehicles and Automotive Equipment on Airside Area and Aircraft Parking
Positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section10.13 Security Deposit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE XI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 11.01 No Other Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE XII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 12.01 Indemnification of Airport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 12.02 Airline Public Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 12.03 Workers Compensation Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 12.04 City Public Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 12.05 Fire and Extended Coverage Insurance - Terminal Building Complex . . . . 37
Section 12.06 Airline Insurance on Automobiles and Other Ground Vehicles . . . . . . . . . . 37
Section 12.07 General Provision Applicable to Airline's Insurance . . . . . . . . . . . . . . . . . . 37
ARTICLE XIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 13.01 Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE_ XIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 14.01 Inspection by City . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE XV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 15.01 Rules and Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE XVI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 16.01 Assigninent and Sublease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE XVII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 17.01 Surrender of Possession - Holding Over . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE XVIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section18.01 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE XIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 19.01 Default by Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 19.02 Remedies Upon Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 19.03 Cancellation by City . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 19.04 Cancellation by Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE XX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 20.01 Damage or Destruction of Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE XXI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 21.01 Prohibited Uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 21.02 Oil, Fuel and Other Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 21.03 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
ARTICLE XXII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 22.01 Improvements by Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 22.02 Conditions Covering Improvements and Alterations . . . . . . . . . . . . . . . . . . 49
Section 22.03 Ownership of Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE XXIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Airport Use and Lease Agreement iii Dated 07/01/94
Section 23.01 Non-Discrimination and FAA Required Clauses . . . . . . . . . . . . . . . . . . . . . 51
Section 23.02 Federal Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE XXIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 24.01 Condemnation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE XXV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.01 Non-Waiver of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.02 Invalidity of Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.03 Approval by the Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.04 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.05 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.06 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 25.07 Non-Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 25.08 Attorneys' Fees and Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 25.09 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 25.10 Termination of Prior Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 25.11 Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 25.12 Agreement Not to Grant More Favorable Terms . . . . . . . . . . . . . . . . . . . . 57
Section 25.13 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 25.14 Invalidity of Covenants, Conditions or Provisions . . . . . . . . . . . . . . . . . . . . 57
Section 25.15 Jurisdiction and Venue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 25.16 No Oral Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Airport Use and Lease Agreement iv Dated 07/01/94
EXHIBITS
EXHIBIT A Airside, Terminal and Landside Areas
EXHIBIT B Existing Exclusive Use Space, Existing Joint Use Baggage Claim/Common Area,
and Existing Joint Use Walkway
EXHIBIT C Exclusive Use Space
EXHIBIT D First Level Concourse Building
EXHIBIT E Second Level Concourse Building
EXHIBIT F Airport Terminal Development Program
EXHIBIT G Maintenance, Services and Utilities Responsibilities
EXHIBIT H Gate Allocation Formulas
EXHIBIT I Preferential Use of Concourse Gate Positions
Airport Use and Lease Agreement v Dated 07/01/94
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AIRPORT USE AND LEASE AGREEMENT
THIS AIRPORT USE AND LEASE AGREEMENT ("Agreement") made and entered into as of the 1"
day of ARY, 19 4, by and between the CITY OF PALM SPRINGS, a municipal corporation organized
and existing under the laws of the State of California ("City"), and-`J2MS V40P�L-L1 A3-PR - 14cl
a corporation organized and existing underthe laws of the State of o.0 �G� ("Airline").
WITNESSETH:
WHEREAS, the City owns and operates the Palm Springs Regional Airport ("Airport"), located
in the City of Palm Springs, County of Riverside, State of California; and
WHEREAS, City operates the Airport as a governmental function for the primary purpose of
providing to the public the service of air transportation; and
WHEREAS, Airline is engaged in the business of commercial air transportation of persons,
property, cargo and mail ("Air Transportation") and desires to enter into a use and lease agreement
covering certain premises, facilities, rights, licenses, services and privileges at the Airport; and
WHEREAS, City and Airline mutually desire to enter into an Agreement, in order to provide Air
Transportation services for the community and its visitors, and
WHEREAS, City has the right to permit the use of its property at the Airport and to grant the
use of the Airport to Airline for the operation of Airline's Air Transportation service; and
WHEREAS, City intends to issue bonds, notes, certificates of participation or other obligations
in an amount not to exceed Twenty Five Million Dollars ($25,000,000) in order to develop new and
improved terminal facilities at Airport,
NOW, THEREFORE, for and in consideration of the Premises and the mutual covenants
hereinafter contained to be observed and performed, the parties hereto covenant, agree and bind
themselves as follows:
ARTICLE I
DEFINITIONS
The following words, terms and phrases, whenever used in this Agreement, shall have the
meanings respectively ascribed to them in this Article.
Airport Use and Lease Agreement 1 Dated 07/01/94
0
Section 1.01 Aircraft Loading Bridge(s) or AC Loading Bridge(s) shall mean the covered
airline equipment affixed to the Terminal to permit passengers access from the Passenger Departure
Lounges in the Terminal Building Complex to parked aircraft.
Section 1.02 Aircraft Operator shall mean the operator of an aircraft, whether the aircraft is
owned, leased or chartered, that is used for private, military, pleasure or governmental operations, or
for airline or non-airline operations, or for scheduled or non-scheduled operations. "Aircraft Operator"
does not mean the pilot of an aircraft unless such pilot is also the owner or lessee thereof or a person
to whom such aircraft is chartered.
Section 1.03 Aircraft Parking Position(s) or AC Parking Position(s) shall mean the
positions on the Airport's Terminal Apron Area where aircraft are required to park in order to enplane
and deplane passengers.
Section 1.04 Airline Funded Cost shall mean for each Capital Project described in the Airport
Terminal Development Program, the estimated amount set forth opposite such Capital Project in the
Program.
Section 1.05 Airline Rates and Charges shall mean for any Fiscal Year, all rates, fees and
charges payable by all Signatory Airlines for such Fiscal Year as specified herein.
Section 1.06 Airport shall mean the Palm Springs Regional Airport owned and operated by
the City or Palm Springs, the location of which is 3400 East Tahquitz Canyon Way, Palm Springs,
California, Riverside County.
Section 1.07 Airport Improvement Program shall mean the Federal Grant in Aid program
for airports, as it now exists or as it may be modified in the future.
Section 1.08 Airport Layout Plan shall mean the Airport Layout Plan dated January 20, 1993,
as it may be amended from time to time, required by the Federal Aviation Administration to be
submitted by the City for review and approval showing the layout of the Airport and the current and
projected uses of the facilities located at the Airport.
Section 1.09 Airport Terminal Development Program or Programs shall mean the
expansion and improvement of the Existing Terminal Building Complex including the development of
a new Second Level Concourse Building, improvements to the existing Terminal Building (i.e. re-
roofing, equipment screening and FIDS) and consolidation of central plant functions.
Airport Use and Lease Agreement 2 Dated 07/01/94
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Section 1.10 Airside Area shall mean the land identified as Airside Area on Exhibit A, and
except as otherwise provided herein, all facilities, equipment and improvements now or hereafter
located thereon, including but not limited to the following:
(a) Airfield Area
(1) Runways - runways at the Airport for the landing and taking-off of aircraft;
(2) Taxiways - taxiways and taxilanes at the Airport for the ground movement of
aircraft to, from and between the runways, Aircraft Parking Areas, and other
portions of the Airport;
(3) Aircraft Parking Positions;
(4) Facilities Incidental to the Runways and Taxiways - facilities for the purpose of
controlling and assisting arrivals, departures and operations, of aircraft using the
Airport, such as airfield security roads, control towers, navigational aids, and
support facilities operated and maintained by the FAA, signals, beacons, wind
indicators, flood lights, landing lights, boundary lights, construction lights,
fencing, open or undeveloped spaces or areas inside Airport fence not in
Terminal or Landside Areas, radio and electronic aids or other aids to
operations, navigation or ground control of aircraft whether or not of a type
herein mentioned and even though located away from the rest of the Airside
Area;
(b) Air Freight Buildings, Maintenance and Hangar Facilities, and Fixed Base Operations
(FBOs); and
(c) Aircraft Rescue and Firefighting (ARFF) Services, facilities and equipment (80% of the
costs).
Section 1.11 Airside Cost-Revenue Center for cost accounting purposes shall mean the
revenues and expenses associated with the Airside Area.
Section 1.12 Capital Expenditure shall mean an expenditure for the acquisition, construction
or equipping of a Capital Project, together with related design, architectural and engineering fees,
consulting Fees, laboratory and testing fees, financing costs, and other associated costs.
Section 1.13 Capital Project shall mean a capital improvement at the Airport, including but
not limited to, the Airport Terminal Development Program, or the acquisition of land beyond the then-
current boundaries of the Airport for use as a part of the Airport.
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Section 1.14 Certificated Maximum Landing Weight shall mean the current maximum
allowable gross landing weight, expressed in 1,000 pound units, of aircraft operated by Airline and
certificated by the Federal Aviation Administration for operation at the Airport.
Section 1.15 Concession Revenues shall mean for any Fiscal Year, rentals, charges and
fees of any kind or nature payable to City during such Fiscal Year from tenants, licensees, permittees,
or other operators at the Airport, for the right to use premises at the Airport to sell or lease
merchandise, services (other than Air Transportation) or other intangibles, including, but not limited
to, restaurants, cocktail lounges, car rental agencies, news stands, gift shops, specialty shops,
advertising displays, insurance sales facilities, public telephones, facilities for the furnishing of ground
transportation services, hotels, and parking areas.
Section 1.16 Concourses shall mean the First Level and Second Level Terminal Buildings,
and areas adjacent thereto, serving the Signatory Airlines and other Aircraft Operators for the loading
and unloading of passengers, including Passenger Departure Lounges;Aircraft Loading Bridges,where
applicable; concession areas; public areas, including security screening; and other tenant and City
space thereon.
Section 1.17 Concourse Gate Position shall mean an aircraft loading facility unit in the
Concourses, which may include a Passenger Departure Lounge, and where applicable, an Aircraft
Loading Bridge. As of DBO, eleven Aircraft Loading Bridges may be provided at Gates 1 through 11.
Section 1.18 Cost-Revenue Centers or CRCs shall mean those areas of the Airport grouped
together for the purposes of accounting for Revenues, Maintenance and Operations Expenses, Capital
Expenditures, Reserve Fund deposit requirements, Debt Service, and for calculating Airline Rates and
Charges. The CRCs named in this Agreement, taken together, comprise the entire Airport, and are
the Terminal Area, Airside Area and Landside Area.
Section 1.19 Date of Beneficial Occupancy or DBO shall mean the date established by the
City by written notice to Airline on which the Premises in the two level Concourse Complex will be
substantially completed and usable by Airline as a result of the Airport Terminal Development Program,
without hazard or undue inconvenience based upon a certification by City's architect/engineer, a copy
of which shall accompany such notice. City agrees to give Airline access to the leased Premises at
least 60 days prior to the anticipated day of DBO to allow Airline to install its equipment and other
fixtures. Such installations shall be coordinated with City's architect/engineer.
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Section 1.20 Debt Service shall mean for any Fiscal Year, principal payments, interest
payments, fund deposit requirements and amounts payable as a result of debt service coverage
requirements on obligations of the Airport payable for such Fiscal Year, including but not limited to
bonds, notes and certificates of participation.
Section 1.21 Director of Aviation shall mean the person designated by City to exercise
functions with respect to the rights and obligations of City under this Agreement. The term also
includes any person expressly designated to exercise functions with respect to the rights and
obligations ofthe Director of Aviation under this Agreement, or such other person, division, department,
bureau, or agency as may from time to time exercise functions equivalent or similar to those exercised
by the Director of Aviation, as appointed by the City.
Section 1.22 Effective Date shall mean JulP1� / �5
Section 1.23 Enplaned or Enplaning Passengers shall mean the revenue, originating and
connecting passengers actually boarding the aircraft operated by the Airline or user of the facility in
question at the Airport during the period of the cost apportionment.
Section 1.24 Exclusive Use Space shall mean the exclusive use space as shown on Exhibit
C, which City has granted Airline the right to use exclusively from the Effective Date of this Agreement.
Section 1.25 Exclusive Use Space Rate shall have the meaning assigned in Section 5.02(a).
Section 1.26 Existing Joint Usc- Baggage Claim/Common Area shall mean the area as
shown on Exhibit B, which City has granted Airline the right to use jointly with other Aircraft Operators
for the purpose of unloading and delivering to its passengers the baggage of such passengers from
the Effective Date of this Agreement.
Section 1.27 Existing Joint Use Walkway shall mean the walkway area adjacent to existing
Gates 1 through 12B, as shown on Exhibit B, for which City has granted Airline the right to use jointly
with other Aircraft Operators for the purpose of loading and unloading its passengers from the Effective
Date of this Agreement to DBO.
Section 1.28 Expiration Date shall mean June 30, 2004.
Section 1.29 FAA or Federal Aviation Administration shall mean the Federal Aviation
Administration created under the Federal Aviation Act of 1958 or such successor agency as may from
time to time have similar jurisdiction over Airline or its business, and Airport.
Section 1.30 Fee Landing shall mean any landing at the Airport of an aircraft, except general
aviation; military; an aircraft engaged in flight training and testing, subject to Section 3.01(D); and an
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aircraft which takes off from the Airport and, without making a stop at any other airport, returns to and
lands at the Airport because of meteorological conditions, mechanical or operating causes, or any
similar emergency or precautionary reason.
Section 1.31 First Level Concourse Building shall mean the area of the Terminal Building
Complex, shown on Exhibit D, which includes a Passenger Departure Lounge, public areas (including
a portion of security screening), concession areas, and other tenant and City space thereon, if
applicable.
Section 1.32 Fiscal Year shall mean the 12-month period beginning on the 1 st day of July
of any year or any 12-month period the City may designate.
Section 1.33 Independent Accountant shall mean a certified public accountant selected by
City, licensed to practice in the State of California, and who (a) in the case of an individual, shall not
be a director, commissioner, officer or employee of either City or any Signatory Airline, (b) shall be
satisfactory to the Trustee, if any, and (c) may be the independent accountant that regularly audits the
books of City or the Airport.
Section 1.34 Indirect Cost Pool shall mean a subsidiary account of the Cost-Revenue
Centers for recording Maintenance and Operations Expenses which cannot be identified to a specific
CRC, and for recording required deposits to the Maintenance and Operations Reserve Fund and
Special Capital Improvement Fund. The Indirect Cost Pool includes, but is not limited to the following:
(a) Airport Administration and Operations Expenses;
(b) Central Plant Functions;
(c) Maintenance and Operations Reserve Fund Deposit Requirement;
(d) Special Capital Improvement Fund Deposit Requirement;
(e) Security Access Control System (SACS);
(f) Airport Security and Security Badging Costs;
(g) Insurance Expenses; and
(h) Motor Vehicle Replacement (MVR) Fee.
The total expenses in the Indirect Cost Pool shall be allocated to the Airside & Terminal CRCs. Said
allocation shall be at the discretion of the Director of Aviation following consultation with the Airlines.
Section 1.35 Joint Use Formula shall mean the formula used to prorate a specified charge
such that 10% of the charge to be prorated shall be apportioned equally among the users, including
regularly scheduled airlines subletting space from another airline, and 45% of such charge shall be
Airport Use and Lease Agreement 6 Dated 07/01/94
apportioned among such users in the same proportion that the number of each such user's Enplaning
Passengers at the Airport during the Fiscal Year under consideration bears to the total number of
Enplaning Passengers of all such users at the Airport during the same Fiscal Year, and the remaining
45% of such charge shall be apportioned among such users in the same proportion that the number
of each such user's Fee Landings at the Airport during the Fiscal Year under consideration bears to
the total number of Fee Landings of all such users at the Airport during the same Fiscal Year. For
purposes of this calculation, each Signatory Airline's total Enplaning Passengers and Fee Landings
shall include, in addition to the Enplaning Passengers and Fee Landings served by such Signatory
Airline, the number of Enplaning Passengers and Fee Landings handled by said Signatory Airline for
other Aircraft Operators that do not have an agreement with City that provides for the direct payment
to City of appropriate charges for use of Joint Use and Preferential Use Space. Joint Use Formula shall
be used to calculate Airline Rates and Charges for the Joint Use Baggage Claim/Common Area, Joint
Use Walkway, temporary joint use passenger holdrooms and the commuter holdroom. As of DBO, the
charges for the holdrooms shall be apportioned separately based on Airline gate locations with First
Level Concourse and Second Level Concourse charges being subject to further negotiation 1 year
prior to estimated DBO.
Section 1.36 Landing Fee shall have the meaning assigned to such term in Section 5.04 of this
Agreement.
Section 1.37 Landing Fee Rate shall have the meaning assigned to such term in Section 5.04 of this
Agreement.
Section 1.38 Landside Area shall mean the area identified as Landside Area on Exhibit A, and
except as otherwise provided herein, all facilities, equipment and improvements now or hereafter
located thereon.
Section 1.39 Landside Cost-Revenue Center for cost accounting purposes shall mean the revenues
and expenses associated with the Landside Area facilities, equipment and improvements now or
hereafter located thereon and 60% of which shall be allocated to the Terminal CRC and 40% of which
shall be allocated to the Airside CRC.
Section 1.40 Main Terminal Building shall mean that portion of the Terminal Building Complex
serving Aircraft Operators and others as shown on Exhibit B, including but not limited to airline ticket
counters, airline office and operations space, outbound baggage belts, baggage claim area, public
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space, airport operations and administration space, law enforcement office, concession space, and
other tenant and City space thereon.
Section 1.41 Maintenance and Operations Expenses shall mean the costs incurred by the City in
operating, maintaining, repairing, and administering the Airport during such Fiscal Year, either directly
or indirectly by allocation to the Airport by City, including, but not limited to:
(a)the following costs and expenses incurred by City for employees of City employed at the Airport,
or doing work involving the Airport: direct salaries and wages (including overtime pay), together with
payments or costs incurred for associated payroll expenses, cash payments to pension funds,
retirement funds or unemployment compensation funds, life, health, accident and unemployment
insurance premiums, deposits for self-insurance, vacations and holiday pay, and other fringe benefits;
(b)cost of repairs, materials, supplies, machinery and equipment and other similar expenses which,
under generally accepted accounting principles, are not capitalized;
(c) costs of maintenance, landscaping, decorating, repairs, renewals, and alterations not
reimbursed by insurance, and which, under generally accepted accounting principles,
are not capitalized;
(d) costs of water, electricity, natural gas, telephone service and all other utilities and
services whether furnished by City or purchased by City and furnished by independent
contractors at or for the Airport;
(e) costs of rentals of equipment or other personal property;
(f) costs of rentals of real property;
(g) costs of premiums for insurance, including property damage, public liability, burglary,
bonds of employees, workers' compensation, disability, automobile, and all other
insurance covering the Airport or its operations;
(h) terminal fees and charges, concession fees, Landing Fees, miscellaneous Airport fees
and indemnification payments unpaid by any Aircraft Operator or other Airport tenant
when due and reasonably deemed by City to be uncollectible after collection efforts
have been undertaken by City;
(i) costs incurred in collecting and attempting to collect any sums due City in connection
with the operation of the Airport;
Q) costs of advertising at or for the Airport, including public relations brochures and events;
(k) costs of Law Enforcement and Aircraft Rescue and Firefighting (ARFF) services;
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(1) except to the extent capitalized, compensation paid or credited to persons or firms
appointed or engaged, from time to time, by City to render advice and perform
architectural, engineering, construction management, financial, legal, accounting,
consulting, testing or other professional services in connection with the operation,
expansion, alteration, reconstruction, betterment or other improvement of the Airport or
any of its structure or facilities;
(m) except to the extent capitalized, trustees' fees, paying agents' fees, and all other fees
and expenses incurred in order to comply with the provisions of any ordinance or
resolution authorizing obligations issued pursuant to Section 9.02.
(n) the costs of maintaining and operating the public address system, flight information
display system, baggage information display system and the security access control
system; and
(o) all other direct and indirect expenses which arise out of City's operation of the Airport,
and which, under generally accepted accounting principles, are properly chargeable as
expenses to the Airport, including any taxes payable by City which may be lawfully
imposed upon the Airport.
Section 1.42 Maintenance and Operations Reserve Fund shall mean the Maintenance and
Operations Reserve Fund created under Section 6.04.
Section 1.43 Non-Airline Revenues shall mean for any Fiscal Year all revenues, except
Signatory Airline Revenues which include Exclusive Use Space, Joint Use space and Preferential Use
Space fees and charges, and Landing Fees.
Section 1.44 Passenger Departure Lounne(s) on the First Level Concourse shall mean
the area assigned to Aircraft Operators on a joint use basis for the assembly and processing of
passengers.
Section 1.45 Preferential Use shall mean an Aircraft Operator's right to use space prior to
use by others on a nonexclusive basis.
Section 1.46 Preferential Use Space shall mean the space, including AC Parking Position(s)
and Passenger Departure Lounge(s) and equipment, including Aircraft Loading Bridge(s), which City
has granted to Airline a right to use on a nonexclusive but Preferential Use basis.
Section 1.47 Premises shall mean the Exclusive Use Space, the Preferential Use Space, and
the Joint Use Space.
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Section 1.48 Reserve Funds shall mean the Maintenance and Operations Reserve Fund,
Special Capital Improvement Fund and Landside Development Fund.
Section 1.49 Second Level Concourse Building shall mean the area of the Terminal
Building Complex, shown on Exhibit I, which includes Passenger Departure Lounges, Public Areas
(including a portion of security screening), concession areas, and other tenant and City space thereon,
if applicable.
Section 1.50 Signatory Airline(s) shall mean Airline and other Aircraft Operators serving the
Airport that have entered into agreements with the City that are substantially similar to this Agreement.
and have so selected this category in Article II of this Agreement.
Section 1.51 Special Capital PrDlects Fund shall mean the Special Capital Projects Fund
created under Section 5.06.
Section 1.52 Terminal Area or Terminal Building Complex shall mean the Main Terminal
Building, First Level Concourse Building and Second Level Concourse Building.
Section 1.53 Terminal Cost-Revenue Center for cost accounting purposes shall mean the
revenues and expenses associated with the Terminal Area or Terminal Building Complex facilities,
equipment and improvements now or hereafter located thereon, including but not limited to the
following:
(a) Airline Space - including Ticket Counters, Administration and Operations Space,
Outbound Baggage, Passenger Departure Lounges, and Baggage Claim Space;
(b) Concessions - including Food and Beverage, News & Gifts, Auto Rental, and Specialty
Concessions;
(c) Security Screening;
(d) Central Lobby and Public Areas;
(e) Public Address System;
(f) Other Airport Tenant Space:; and
(g) Aircraft Rescue Fire Fighting (ARFF) services, facilities and equipment (20%).
Section 1.54 Total Landed Weight shall mean the sum of the Certificated Maximum Landing
Weights for all Fee Landings over a stated period of time.
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ARTICLE II
TERM
Section 2.01 Term of Agreement
e-d j
The term of this Agreement shall commence on the Effective Date, and expire
on June 30, 2004, the Expiration Date. In accordance with Section 19.04, said Airline may cancel this
Agreement by providing three hundred sixty four (364) days written notice to City.
ARTICLE III
GRANT OF RIGHTS
Section 3.01 Rights of Airline
Airline shall have the following rights with respect to the Airport:
(A) Right to Use Airport. The City hereby grants to Airline, its employees, passengers,
guests, patrons, and invitees, the right to the use of(in common with other duly authorized users) the
Terminal, Landside and Airside Areas together with all facilities, improvements, equipment, and
services that have been or may be provided for common use of such facilities and areas.
(B) Right to Operate Aircraft. Airline shall have the right to land, take off, fly over, taxi, push
and tow, any aircraft of its choice, properly licensed by the FAA and all other governmental authorities
with jurisdiction, in appropriate areas of the Airport (subject to the design limitations of such areas) and
to park, load and unload such aircraft at the Aircraft Parking Position(s) assigned to Airline. Airline
shall not schedule aircraft landings and take offs between the hours of 2200 and 0700 for jet aircraft.
(C) Right to Provide Services. Within designated areas, Airline shall have the right to sell
Air Transportation tickets and services; to (process passengers and their baggage for air travel; to sell,
handle, and provide mail, freight, express and cargo services; and to perform other similar activities
reasonably related to the operation of Airline's Air Transportation service.
Subject to the provisions of Section 3.01(0) hereof, Airline shall have the right to perform
ground handling services for other airlines engaged in Air Transportation.
(D) Right to Provide Training_ Airline shall have the right to provide training at the Airport
of personnel in the employ of or to be employed by Airline and the testing of aircraft and other
equipment owned and operated by Airline, provided that such training and testing shall be incidental
to the use of the Airport in the operation by Airline of its Air Transportation service. Such training and
testing shall not unreasonably hamper or interfere with the use of the Airport by other users entitled
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to the use thereof; and shall be conducted in areas of the Airport which have been leased to Airline
or authorized by the Director of Aviation.
(E) Right to Sell Its Aircraft. Equipment and Supplies Airline shall have the right to sell,
dispose of or exchange Airline's aircraft, engines, accessories and other equipment or supplies bought
for its own use or as part of ground handling services provided to other airlines and not for resale.
This right shall not imply that Airline has the right to conduct a separate business related to such sales.
(F) Right to Purchase from Person or Company of its Choice Airline shall have the right
to purchase at the Airport or elsewhere from any person or company of its choice, its requirements of
aviation fuel, ground vehicle fuel, lubricating oil, greases, food, beverage, and other passenger
supplies, and all other materials and supplies and services, so long as that person or company is
properly permitted to provide service at the Airport.
(G) Right to Service Aircraft and Other Equipment Airline shall have the right to have its
aircraft and other equipment serviced by suppliers of its choice. Such suppliers may provide materials
and services, including, but not limited to, aviation fuel, ground vehicle fuel, lubricating oil, greases,
parts and all other materials and supplies and services required by Airline in the conduct of its Air
Transportation service. Such right shall include, but not be limited to, the right to erect, install and
maintain at designated locations at the Airport ( as authorized by the Director of Aviation for that
purpose by separate agreement between Airline and City) storage facilities for aviation fuel, lubricating
oil, greases and other materials and supplies,together with the necessary pipes, pumps, motors, filters
and other appurtenances incidental to the use thereof, so long as said supplier is properly permitted
to provide service at the Airport.
(H) Right to Handle Persons. Property and Mail. Airline shall have the right to load and
unload persons, property and mail by such motor vehicles or other means of conveyance at areas
designated by City as Airline may reasonably require in the operation of its Air Transportation service
so long as operator is properly permitted to operate at the Airport. Airline may designate the particular
ground carrier, or carriers, that may transport Airline's employees, property and mail to, from and on
the Airport, provided that the particular carrier or carriers so designated by Airline hereunder shall be
required to comply with all applicable and reasonable rules, regulations and laws. Contractual
arrangements by Airline hereunder with any carrier of passengers and their baggage for ground
transport to and from the Airport shall subject to the payment to City by said passenger carriers of a
fee to be Fixed and determined by City. Such fees shall not apply to arrangements for late or other
Airport Use and Lease Agreement 12 Dated 07/01/94
baggage delivery, crew hauls/shuttles, or surface transportation provided for a diverted or canceled
flight.
(1) Right to Install Signs. Airline shall have the right to install signs identifying Airline's
Exclusive Use and Preferential Use Space and the function or operation conducted therein. The
number, size, type, design and location shall be harmonious and in keeping with the pattern and decor
of the Terminal Area and shall be subject to Section 10.07 and the prior written approval of the
Director of Aviation.
M Right to Install and Operate Communications Equipment. Airline shall have the right
to install, maintain and operate on or about the Airport such telecommunications (including radio
antennae), meteorological and aerial navigation equipment and other facilities as may be reasonably
necessary or convenient for the proper performance and operation by Airline of its Air Transportation
service, subject to the prior written approval of the Director of Aviation. Such equipment and facilities
shall be located in areas leased to Airline for its exclusive use, or on such other portions of the Airport
as may be authorized for that purpose by the City. Airline shall be provided with reasonably adequate
rights of way for the installation of communications controls, teletype,telephone, interphone, pneumatic
tubes and power lines in and between the Terminal Building Complex and other points at the Airport;
provided, however, the manner of such installations and the location of such rights of way shall be
subject to approval by the City.
(K) Ingress and Egress. The City hereby grants to the Airline, its agents, employees,
passengers, guests, invitees, contractors and suppliers of material and service the right to reasonable
access, ingress and egress to the Premises and the public areas and facilities of the Airport. Such
right shall be exercised in accordance with Airport rules and regulations and shall at all times be
exercisable without charge to the Airline, its agents, employees, guests, passengers, invitee,
contractors and suppliers of materials and services; provided, however, that this provision shall not be
construed to prevent the City from imposing the additional rentals, fees, taxes, and charges referred
to in Section 11.01 of this Agreement.
(L) Porter Services. Airline shall participate in nonexclusive porter services in conjunction
with all scheduled airlines serving the Airport to assist its passengers with their baggage, and provide
assistance to handicapped passengers subject to the rules and regulations of City.
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(M) Right to Provide Curbside Baggage Check-In Service. Airline shall have the right to
provide curbside baggage check-in service, the location and operation of which shall be subject to the
prior written approval of City and the rules; and regulations of City.
(N) Right to Provide Services on Behalf of Other Aircraft Operators. The rights and
privileges granted Airline under this Article I, with respect to the performance of ground services and
activities in connection with its Air Transportation services at the Airport, may be exercised by Airline
for and on behalf of any other Aircraft Operators or companies authorized by City to use the Airport.
This provision shall not be construed by the parties hereto to impede, hinder or negate the legislative
intent of the Airline Deregulation Act of 1978.
(0) No Other Business Authorized. Nothing contained in this Section 3.01 shall be
construed to authorize Airline to conduct a business of any kind at the Airport except its Air
Transportation service, and nothing herein contained shall be construed as authorizing Airline in its
conduct of its Air Transportation service to interfere unreasonably with other persons or tenants leasing
or lawfully using Airport facilities. Nothing in this Section shall be construed as in any way limiting the
general powers of City to fully exercise its statutory functions.
(P) Rules and Regulations. AH activities of Airline pursuant to this section 3.01 shall be
performed in compliance with all applicable Federal, State and local laws, ordinances, and regulations.
ARTICLE IV
AIRLINE'S PREMISES
Section 4.01 Period From Effective Date to DBO
Commencing on the Effective Date of this Agreement and continuing until DBO, City grants
Airline the right to use certain premises located in the Terminal Building Complex at the Airport,
consisting of the following:
(A) Existing Exclusive Use Space. A portion of the Terminal Building Complex known as
Existing Exclusive Use Space, consisting of ticket counter space, office and operations space, and
outbound baggage space, and baggage service desks. The square footage of floor area as shown and
delineated on Exhibit C shall apply to this agreement.
(B) Joint Use Baggage Claim/Common Area. A portion of the joint use space in the
Terminal Building Complex known as Existing Joint Use Baggage Claim/Common Area containing
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24,651 square feet of floor area for nonexclusive use in common with other Aircraft Operators as
shown on Exhibit B.
(C) Existing Joint Use Walkway_ A portion of the joint use space in the Terminal Building
Complex known as Existing Joint Use Walkway containing 20,823 square feet of floor area for
nonexclusive use in common with other Aircraft Operators as shown on Exhibit B.
Section 4.02 Period From DBO Until Expiration Date of This Agreement
Commencing on DBO until the Expiration Date, City grants Airline the right to use certain
premises located in the Terminal Building Complex at the Airport, consisting of the areas outlined is
Section 4.01 above and the following:
(A) Preferential Use Space on the Second Level Concourse. A portion of the Terminal
Building Complex, as shown on Exhibit E, including Aircraft Parking Position(s) and Passenger
Departure Lounge(s) and equipment, including Aircraft Loading Bridge(s), which City grants to Airline
on a nonexclusive but Preferential Use basis.
(B) Joint Use Space on the First Level Concourse. A portion of the Terminal Building
Complex, as shown on Exhibit D, including Aircraft Parking Position(s) and a Passenger Departure
Lounge and equipment, which City grants to Airline a right to use in common with other Aircraft
Operators.
ARTICLE V
CALCULATION OF AIRLINE RATES AND CHARGES
Section 5.01 General Commitment
For the purpose of fairly allocating the net cost of operating and maintaining the Airport among
all of the Signatory Airlines, various areas of the Airport have been grouped together for the purpose
of accounting for revenues, Maintenance and Operations Expenses, Reserve Fund deposit
requirements and Debt Service. Each such area is a Cost-Revenue Center as defined in Section 1.18.
Signatory Airlines shall pay rates and charges as outlined in this Article.
Section 5.02 Period From Effective Date to DBO
Commencing on the Effective Date of this Agreement and continuing until DBO, Airline's
Terminal Rates and Charges shall consist of the following:
(A) Exclusive Use Space Fees. Airline shall pay its share of Maintenance and Operations
Expenses, Reserve Fund deposit requirements and Debt Service allocable to the Terminal CRC, less
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Non-Airline Revenues allocable to the Terminal CRC. Airline's share shall be the total number of
square feet of Airline's Existing Exclusive Use Space multiplied by the Exclusive Use Space Rate
which shall be specified in the City Comprehensive Fee Schedule.
(B) Joint Use Baggage Claim/Common Area. Airline shall pay its prorata share of
Maintenance and Operations Expenses, Reserve Fund deposit requirements and Debt Service
allocable to Joint Use Baggage Claim/Common Area in the Terminal CRC, less Non-Use Agreement
Revenues allocable to the Terminal CRC. Airline's prorata share shall be computed according to the
Joint Use Formula as defined in Section 1.35.
(C) Joint Use Walkway_ Airline shall pay its prorata share of Maintenance and Operations
Expenses, Reserve Fund deposit requirements and Debt Service allocable to joint use walkway in the
Terminal CRC, less Non-Use Agreement Revenues allocable to the Terminal CRC. Airline's prorata
share shall be computed according to the Joint Use Formula as defined in Section 1.35.
Section 5.03 Period From DBO Until Expiration Date of This Agreement
Commencing as of DBO and continuing until the Expiration Date of this Agreement, Airline's
Terminal Rates and Charges shall consist, of the following:
(A) Exclusive Use Space Fees. Airline shall pay its share of Maintenance and Operations
Expenses, Reserve Fund deposit requirements and Debt Service allocable to the Terminal CRC, less
Non-Revenues derived from the Terminal CRC. Airline's share shall be the total number of square feet
of Airline's Exclusive Use Space multiplied by the Exclusive Use Space Rate.
(B) Joint Use Baggage Claim/Common Area. Airline shall pay its prorata share of
Maintenance and Operations Expenses, Reserve Fund deposit requirements and Debt Service
allocable to Joint Use Baggage Claim/Common Area in the Terminal CRC, less Non-Use Agreement
Revenues allocable to the Terminal CRC. Airline's prorata share shall be computed according to the
Joint Use Formula as defined in Section 1.35.
(C) Preferential Use Space on the Second Level Concourse Airline shall pay its prorata
share of Maintenance and Operations Expenses, Reserve Fund deposit requirements and Debt Service
allocable to preferential use space on the second level concourse in the Terminal CRC, less Non-Use
Agreement Revenues allocable to the Terminal CRC, allocated in accordance with Section 1.18 to
Preferential Use Space on the Second Level Concourse. Airline's prorata share shall be computed
according to the Joint Use Formula as defined in Section 1.35.
Airport Use and Lease Agreement 16 Dated 07/01/94
(D) Joint Use Space on the First Level Concourse. Airline shall pay its prorata share of
Maintenance and Operations Expenses, Reserve Fund deposit requirements and Debt Service
allocable to joint use space on the first level concourse in the Terminal CRC, less Non-Use Agreement
Revenues allocable to the Terminal CRC. Airline's prorata share shall be computed according to the
Joint Use Formula as defined in Section 1.35.
Section 5.04 Landing Fees
At such times and in such manner as provided in Article VII, Airline shall pay a Landing Fee
to City for each Fee Landing of an aircraft operated by Airline. The Landing Fee shall be an amount
equal to the product of (i) the number of thousands of pounds of the Approved Maximum Landing
Weight of the aircraft involved in the Fee Landing, multiplied by (ii) the Landing Fee Rate.
The Landing Fee Rate for any Fiscal Year shall be determined (to the nearest 1/10th of one
cent per each one thousand pounds) by dividing the cost of the Airside CRC for such Fiscal Year, by
the total Approved Maximum Landing Weight in thousand-pound units of all aircraft of all Signatory
Airlines Fee Landings during the previous Fiscal Year, adjusted based on preliminary projections of
the upcoming year's activity, as provided for in the Preliminary Projection of Airline Rates and Charges.
The cost of the Airside CRC for any Fiscal Year shall be Maintenance and Operations Expenses,
Reserve Fund deposit requirements and Debt Service allocable to the Airside CRC, less Non-Use
Agreement Revenues allocable to the Airside CRC, allocated in accordance with Section 1.18 to the
Airside CRC.
Section 5.05 Supplemental Space
Airline may elect to lease additional Supplemental Space at the Airport in the categories of
office trailer space, upstairs office space and open acreage. Rates shall be as established in the City's
Comprehensive Fee Schedule. Specific space requested by the airline shall be as shown of Exhibit
H.
The above referenced Supplemental Space may change from time to time with changes
occuring via letters of mutual agreement between Airline Property Manager and the Director of
Aviation.
Section 5.06 Special Capital Projects Fund
(A) The Fund. The City shall establish a separate airport budget activity, to be designated
"Special Capital Projects Fund" to be utilized for any Capital Project or a portion of the cost thereof
(including equipment purchases). Annual contributions to such Fund shall be made from a landing fee
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surcharge to all Airlines in the total amount not-to-exeed $260,000 for the first year. The $260,000
shall be increased by $10,000 annually until it reaches $300,000 annually, the level at which it shall
remain for the term of the agreement. No further contributions will be made when the Fund balance
is $750,000, except as provided in Section 5.09.
(B) Expenditures From the Fund. Single or multiple expenditures not exceeding the
aggregate of $250,000 in any Fiscal Year from the Fund may be made without the necessity for
consent by, or approval of, the Signatory Airlines. Expenditures of more than $250,000 in any Fiscal
Year will require approval as defined in Section 8.06 herein except when said expenditure is made as
a required matching fund to a Federal Grant. To further clarify, in any one fiscal year the Airport may
utilize any amount in the fund for grant matching plus utilize up to $250,000 for other projects and not
be required to seek Airline approval under Section 8.06. The Special Capital Project Fund may not
be listed as Airport revenue eligible for payment of debt service on any new (a refunding of the 1992
bond issue shall not be construed as new) bond issue issued after July 1, 1993.
(C) The Surcharge. The landing fee surcharge, billed on a per-passenger allocation, shall
be calculated each July 1 by dividing the amount of surcharge due for the corning year by the total
number of enplaned passengers for the previous twelve months. This equation shall determine the
per-enplaned passenger surcharge for the following twelve months. Said surcharge shall be collected
monthly, frorn all Airlines serving the Airport until the annual maximum amount is reached or until the
fund balance equals $750,000.
Section 5.07 Employee Ground Vehicle Parking
The City shall make available to Airline's employees assigned to duty at the Airport reasonably
adequate automobile parking facilities. The City may, at its discretion, charge employees of Airline
and others a reasonable vehicular parking fee based on City's actual costs of providing, operating, and
maintaining such facilities.
Section 5.08 Insufficiency of Airport Revenues. Adjustment of Airline Rates and Charges
(A) Right to Adjust. Notwithstanding any other provision hereof, if, at any time while this
Agreement shall remain in effect, City determines that Airport revenues being derived from the
Terminal, Landside and Airside CRCs are, or likely will be, insufficient to pay when due all costs and
expenses of annual debt service requirements on all bonds, maintenance of rate covenant on all
bonds, maintenance, repairs or replacements City may, upon thirty (30) days' notice to Airline, increase
Airline Rates and Charges provided for herein to such amount as is sufficient to assure that actual
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revenues shall be sufficient to pay all such costs and expenses. City agrees that prior to such action,
upon twenty (20) days' notice to Airline, City will hold a meeting with Signatory Airlines to discuss such
charges.
(B) 1992 Bond Issue Coverage. The depreciation of the City's investment in the Airport
(excluding federal gifts and grants in aid), and/or an amount necessary to produce for collection by the
City Net Revenues, as defined in that First Amended and Restated Installment Sale Agreement by and
between the City of Palm Springs (the "Ci4y") and the City of Palm Springs Financing Authority dated
as of August 1, 1992 relating to $16,265,000 City of Palm Springs Financing Authority (the "Authority")
(Palm Springs Regional Airport) Airport: Revenue Bonds, Series 1992 (the "Installment sales
Agreement") and that Master Trust Indenture by and between the Authority and First Interstate Bank
of California dated as of August 1, 1992 relating to $16,265,000 City of Palm Springs Financing
Authority (Palm Springs Regional Airport) Airport Revenue Bonds, 1992 Series (the "Master
Indenture"), in each fiscal year which, together with other available funds, as defined in the Installment
Sale Agreement, are at least equal to 1.25 times Maximum Annual Debt Service, all is provided in
Section 6.17 of the Installment Sale Agreement, or any amendment or supplement to said issuing
Parity Debt, as defined in the Master Indenture or otherwise. Further, and without limitation, the fees
established herein may be readjusted by the City either annually, or, in the City's discretion, upon thirty
(30) days notice to the Airline, on a residual cost basis as described in the Report of the Airport
Consultant delivered to the City dated February 15, 1991 and in such amount as to satisfy the
covenants contained in Section 6.17 of the Installment Sale Agreement, or any other rate installment
sale agreement adopted for the purposes of issuing Parity Debt or otherwise. In making the
adjustment described herein, consideration shall be given to all bonds and other forms of indebtedness
issued and outstanding at the time of the adjustment by the City, the Authority and any other issuer
which issues bonds or other forms of debt on behalf of the Airport provided, however, as to any one
item, consideration is to be given to either debt service or depreciation but not both. In allocating costs
and revenues to the various facilities as herein above defined, the City will apply and observe generally
accepted accounting principals.
Section 5.09 Annual Adjustment to Actual Airline Rates and Charges
Within one hundred twenty (120) days after the close of each Fiscal Year the City will
recompute the rates applicable to the fees and charges payable by Airline for its use of the Premises
and the Landing Fee Rate for the preceding Fiscal Year, based upon actual space utilization, activity,
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costs and expenses, and revenues. If the recalculation results in a variance from the rates charged
the Airline for that Fiscal Year, City will calculate an additional charge or credit against Airline's fees
and charges. Such charge or credit shall be payable in equal monthly installments over twelve (12)
months. Airline agrees to pay any such additional charge as billed in accordance with the foregoing.
Section 5.10 Costs Excluded
The portion of capital costs of the Airport, its facilities and improvements paid for from the
Special Capital Projects Fund, or by Federal Grants-in-Aid or by contributions from other Cities, and
depreciation, amortization and interest charged thereon, if any, shall not be included in the cost factor's
herein.
Section 5.11 Other Charges
In the event City is required to Furnish special law enforcement services under FAR, Part 107
and Part 108; fire and crash protection under FAR, Part 139; and a security access system under FAR,
Part 107.14; or is required to make additional expenditures by any Federal, State or other
governmental order, rule or regulation during the term of this Agreement, the cost and expense thereof
shall be allocated to the appropriate cost center.
City may from time to time, on reasonable notice, determine and impose compensatory service
charges for non-routine apron and ramp cleaning and scrubbing, apron housekeeping and other
special services requested by Airline or made necessary by non-compliance of Airline with City's rules
and regulations.
Section 5.12 Non-Signatory Airlines Rates and Charges
It is acknowledged that the methodology for calculating rates and charges for Signatory Airlines
involves risk to the Signatory Airlines in that rates and charges imposed on Signatory Airlines could
in certain instances require the absorption of deficits due to shortfalls in non-airline revenues. In
recognition of this risk the methodology for calculating rates and charges for the Signatory Airlines
provides for the possibility of reduction of rates and charges by the crediting of surplus non-airline
revenues. In view of the fact that Non-Signatory Airlines will not assume the risk of deficits it is agreed
that they should not receive the benefits of any surplus. It is agreed that in view of the fact that non-
signatories will avoid the risks outlined above, that the City shall charge the non-signatories as follows:
(A) Landing Fees: 125% of the Landing Fee paid by the Signatory Airlines.
(B) Terminal Use: A fee per enplaning passenger based on dividing the total number of
Signatory Airline enplanements for the previous fiscal year, into the total dollars paid by the Signatory
Airport Use and Lease Agreement 20 Dated 07/01/94
Airlines for Joint Use Baggage Clairn/Common Areas, Walkway and public address maintenance times
a factor of 125%.
(C) Special Capital Projects Fund Surcharge: Per Section 5.06(A).
(D) Such other charges for special facilities or activities as deemed appropriate by the City.
ARTICLE VI
IDENTIFICATION AND ALLOCATION OF REVENUES AND EXPENSES
Section 6.01 Maintenance and Operations Expenses Reserve Fund Deposit Requirements and
Non-Use Agreement Revenues
City shall maintain accurate records allocating Maintenance and Operations Expenses, Reserve
Fund deposit requirements and Non-Use Agreement Revenues for each Fiscal Year among the CRCs.
Section 6.02 Disposition of Airport Revenues
All revenues received or otherwise realized by City, or remaining in reserves at the end of the
term of this Agreement, arising from its operation of the Airport shall remain the property of City, and
shall not be expended for any purpose other than the acquiring, establishing, developing, extending,
maintaining, operating and managing the Airport.
Section 6.03 Debt Service
City shall maintain accurate records allocating Debt Service for each Fiscal Year among the
CRCs. The allocation of Debt Service shall be based on actual expenditures made out of the proceeds
of bonds, notes, certificates of participation and/or other Airport obligations giving rise to such Debt
Service for each Capital Project.
Section 6.04 Maintenance and Operations Reserve Fund
The Maintenance and Operations Reserve Fund was established prior to the Effective Date of
this Agreement and shall be used only to make loans to the Maintenance and Operations Fund
whenever and to the extent moneys in the Maintenance and Operations Fund are insufficient to pay
Maintenance and Operations Expenses.
The Maintenance and Operations Reserve Fund deposit requirement for 1993 fiscal year and
the 1994 fiscal year shall be $250,000 and then only $100,000 for each year thereafter until it reaches
20% of the total Maintenance and Operations Expenses. Each year thereafter it shall be the amount
necessary to increase the amount on deposit therein (including amounts receivable from the
Maintenance and Operations Fund) to an amount equal to 20% of the Maintenance and Operations
Airport Use and Lease Agreement 21 Dated 07/01/94
Expenses amount provided in the Preliminary Projection of Airline Rates and Charges, as adjusted
from time to time for Maintenance and Operations Expenses for such Fiscal Year.
The Maintenance and Operations Reserve Fund payment requirements calculated in any Fiscal
Year shall be charged to the Indirect Cost Pool and allocated to the CRCs as prescribed in Section
1.34.
Section 6.05 Landside Development Reserve Fund
(A) The Fund. There is herein created a Landside Reserve Fund which shall be used for other
than terminal and airfield improvements and may be utilized for advertising. The Landside Reserve
Fund deposit shall be $200,000 per year. Contributions to such fund shall be obtained by adding
$200,000 annually as an expense in the Terminal Cost Revenue Center; provided that no further
contributions will be made when the fund balance is $600,000.
(B) Expenditures from the Fund. Single or multiple expenditures may be made without the
necessity for consent by, or approval of, the Signatory Airlines.
(C) Limitation on the Fund. The fund may be utilized for grant matches on Airport
Improvement Program eligible landside programs. Construction development expenditures from the
fund, on other than landside grant projects, are appropriate so long as these improvements lead to the
prudent development of facilities that are financially self sustaining. The fund may also be utilized for
Airport advertising.
ARTICLE VII
PAYMENT OF ,AIRLINE FEES AND CHARGES
Section 7.01 Preliminary Projection of Airline Rates and Charges
Not later than sixty (60) days prior to the end of each Fiscal Year, City shall furnish Airline with
a projection for the next ensuing Fiscal Year of Airline Rates and Charges. The projection
('Preliminary Projection of Airline Rates and Charges") shall incorporate such information, and shall
present, for the Airport in its entirety and for each CRC as defined in Section 1,18, the latest available
data on current operations of the Airport, a pro forma projection for the entire Fiscal Year, and an
estimate of each of the following items for the next ensuing Fiscal Year:
(a) Maintenance and Operations Expenses;
(b) Non-Use Agreement Revenues;
(c) Debt Service;
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(d) Capital Projects;
(e) Maintenance and Operations Reserve Fund deposit requirements and Fund payments;
(f) Special Capital Projects Fund deposit requirements and Fund payments;
(g) Any changes in the number of square feet of any Signatory Airline's Exclusive Use
Space;
(h) Allocation of Non-Use Agreement Revenues, Maintenance and Operations Expenses,
Capital Expenditures, Debt Service and Reserve Fund requirements to CRCs; and the
net cost of the Terminal CRC allocated to Existing or Future Exclusive Use, whichever
is applicable, Joint Use Baggage Claim/Common Area.
Existing Joint Use Walkway, if applicable, Preferential Use Space in the Second Level Concourse
Building, and Joint Use Space in the First Level Concourse Building; and
(i) Summary Schedule of Total Airline Rates and Charges for each Signatory Airline.
Section 7.02 Payment of Airline Rates and Charges
(A) Information to be Provided by Airline. Airline shall furnish to the City on or before the
tenth (10th) day of each month on forms to be supplied by City and signed by an authorized
representative of Airline, for the preceding month reporting (1) the number of Enplaned Passengers
and deplaned passengers; (2)Airline's total number of Fee Landings by type of aircraft and Certificated
Maximum Landing Weight of each type of aircraft; (3) the weight of air freight, air-express, and air mail,
loaded and unloaded by Airline at the Airport; (4) the 30-day projected published flight schedule for
arriving and departing flights at the Airport; (5) the number of Enplaned Passengers and deplaned
passengers and number Fee Landings, by type of aircraft, for which Airline provided handling services
of any kind for other Aircraft Operators, and the names and addresses of the Aircraft Operators so that
the City may submit to such operators appropriate invoices for Landing Fees and other charges; (6)
the number of training and test flights, the time of day during which these flights occurred, and the
Landing Weight of each type of aircraft; and (7) the number of seats per each type of aircraft utilized.
(B) Terminal Rates and Charges. Not later than the tenth (10th) day of each month of each
Fiscal Year, City shall furnish Airline with an invoice setting forth the amount of Airline's Terminal Rates
and Charges for the next ensuing month. Not later than the first (1 st) day of such next ensuing month,
Airline shall pay City an amount equal to Airline's total Terminal Rates and Charges for such month.
(C) Landing Fees. Upon furnishing City with the information described in Section
7.02(A), City shall forthwith furnish Airline with an invoice setting forth the amount of Landing Fees
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payable by Airline for such preceding month, calculated by multiplying the total Approved Maximum
Landing Weight for Airline's Fee Landings at the Airport during such preceding month by the Landing
Fee Rate for such preceding month. Within thirty (30) days after the date of such invoice, Airline shall
pay to City the amount of Landing Fees :set forth herein.
Section 7.03 Late Charges
All fees and charges not timely received by City and within fifteen (15) days after receipt by
Airline of a written notice of delinquency will bear a late charge equal to five percent (5%) of the
payment due and owing. If such rentals, flees and other charges are not received with thirty (30) days,
interest shall accrue on the unpaid balance plus the unpaid late charge at the rate of eighteen percent
(18%) per annum or the highest rate which may be legally charged, whichever is lower, from the due
date until paid in full.
Section 7.04 Provision Against Set-Offs
It is the obligation of Airline to pay all fees and charges, free of any set-offs or claims, in the
amount and at the times specified in this Agreement. In the event that Airline desires to contest the
validity or amount of any such fees and charges, Airline shall first pay the same to City and may then
seek a refund in any appropriate forum.
ARTICLE VIII
PRINCIPLES RELATING TO RATES AND CHARGES
With respect to the Airline Rates and Charges imposed by this Agreement, it is agreed that the
following principles shall be observed.
Section 8.01 General Concepts
The administration and control of all concessions (including vending machines and pay
telephones) in the Terminal Building Complex and elsewhere on the Airport is exclusively reserved to
the City.
Airline shall not install or operate pay telephones, vending machines or amusement machines
and devices of any kind in the Terminal Building Complex or elsewhere on the Airport however, subject
to City's approval, Airline may have such machines and devices installed if such shall be for the use
of Airline's employees only and shall be located in Airline leased areas not accessible to the general
public.
Airport Use and Lease Agreement 24 Dated 07/01/94
Section 8.02 Accounting Principles and Audit Report
Generally accepted accounting principles, consistently applied, recognizing the special
requirements of airports, will be used by the City for keeping the books, accounts and records of the
Airport and in the computation of all rates and charges.
Within nine (9) months, and upon request, after the close of each Fiscal Year, City shall furnish
Airline with a copy of an annual audit report, prepared in accordance with generally accepted
accounting principles and certified by an Independent Accountant, covering the operation of the Airport
for such preceding Fiscal Year.
Section 8.03 Cost or Expense Allocation
All costs or expenses directly attributable to each Cost Revenue Center shall be charged to the
appropriate Cost Revenue Center.
All overhead or other indirect costs or expenses shall be allocated to each Cost Revenue
Center on the basis of work orders, value of asset, space footage or other appropriate method
determined by the City, but in the event that a cost or expense cannot be so allocated the cost shall
be charged to the Indirect Cost Pool and allocated as follows: 50% of such cost or expense shall be
allocated in the ratio of all direct costs or expenses allocated to each CRC, and the remaining 50%
of such cost or expense shall be allocated in the ratio of revenue received from each CRC.
Section 8.04 City to Exercise Prudence
The City agrees to exercise prudence in the operation, maintenance, improvement, expansion,
management and financing of the Airport.
Section 8.05 Additional Capital Expenditures
It is understood that from time to time the City will make additional expenditures for capital
improvements and capital asset purchases at the Airport, or in relation to the Airport such as:
a) Projects that are mandated by the Federal Aviation Administration or are necessary in
order to comply with laws, rules and regulations of Federal Aviation Administration or
any other government agency.
b) Projects relating to the Airside Areas that are indicated in the Airport Layout Plan, as
it may be amended from time to time, that have been reviewed and conditionally
approved by the Federal Aviation Administration, and that will be undertaken by the City
when federal grants are available to fund a substantial portion of the expenditure and
it is prudent to undertake the Project.
Airport Use and Lease Agreement 25 Dated 07/01/94
c) Projects that would enhance the safety and security of the Airport.
d) Projects to repair casualty damage to Airport property, preventative pavement
maintenance and the repair, replacement or unscheduled maintenance of equipment
used in the operation of the Airport.
e) Purchase of land that may be required for any of the foregoing projects when prudent
to do so when the majority of the cost is funded by the Federal Aviation Administration.
f) Special projects, including but not limited to international arrivals facilities the cost of
which shall be entirely borne by the beneficial user of the improvement or asset for
which the expenditure was made.
g) Projects to be funded with the Special Capital Projects Fund pursuant to Section 5.05.
h) Projects to be funded from the Landside Development Reserve Fund pursuant to
Section 6.05.
i) Projects to be funded from ,any special contribution received from any Coachella Valley
city.
j) Other projects, not described above that may be prudent, in the operation and
maintenance of the Airport or in the preparation for the prudent expansion of the Airport
and/or any of the Airport's facilities.
k) Such other projects and expenses as the Signatory Airlines may authorize for their own
purposes.
The amortization of costs plus interest and other expenses associated therewith not covered
by funding previously contributed by the Signatory Airlines, grants and participating funds from the
United States of America and the State of California, County or any special contribution from other
cities or any agency thereof, including all payments, deposits and other requirements relating to the
issuance of bonds, notes, certificates of participation and payments to banks and other lenders shall
constitute an expense when such projects are on or at the Airport and shall be chargeable to the
appropriate Airport CRC; provided that prior to making any expenditure for projects in c), i), j) and k)
above, the City has received Airline approval, per Section 8.06. It is agreed that City may proceed with
projects described in a), b), d), e), f), g) and h) above without Airline Approval.
Section 8.06 Airline Approval
The Airline approval of Capital Projects outlined in Section 8.05 c), i),j) and k) shall be obtained
by the City submitting a proposal in writing therefor to all Signatory Airlines which proposal shall
Airport Use and Lease Agreement 26 Dated 07/01/94
include an estimate of the budget for and a description of such Capital Project and the Maintenance
and Operation Expenses resulting therefrom; and the construction schedules for such Capital Project,
if applicable. Airline may within ten (10) days request a meeting with the City's representatives to
discuss the project and parties agree to schedule said meeting within twenty (20) days after said
request. Airline agrees to furnish City in writing, its approval or disapproval of the project within thirty
(30) days after said meeting or thirty (30) days after the initial notice from City, if a meeting was not
requested; it being agreed that the Airline's failure to timely furnish its approval or disapproval will be
deemed to be Airline's approval of the project. Approval shall be based on Signatory Airlines
representing 50% of the Signatory Airlines and 50% of the Enplaned Passengers at the Airport.
Section 8.07 Grants
Consistent with good business practices, the City agrees to prudently seek the maximum
amount of grants and participating funds for the Airport from the United States of America and the
State of California, and any agency thereof, and advise the Airlines of such application by direct notice
or by incorporating anticipated amounts in proposed budgets.
Section 8.08 Bonded Indebtedness
City shall issue no additional bonded indebtedness for airport improvements, except for a
refunding of the 1992 Bond Issue or except for the Airport Terminal Development Program outlined
in Article IX, for the First five years of this Agreement without first receiving Airline approval via the
process outlined in Section 8.06.
Section 8.09 Outside Storage
Airline takes notice of the fact that City has entered into various fixed based operators
agreements with third parties to provide aviation-related services to the public which include among
other things the rental of aircraft outside storage areas. In the event Airline requires outside storage
(i.e. storage other than on terminal aircraft aprons) of its aircraft, such storage shall be subject to user
charges adopted from time to time by such fixed based operators.
ARTICLE IX
AIRPORT TERMINAL DEVELOPMENT PROGRAM
Section 9.01 Approval of Airport Terminal Development Program
City and Airline each hereby approve the Airport Terminal Development Program ("Program")
attached hereto as Exhibit f , subject to attainment of an Enplaned Passenger level of 500,000, except
Airport Use and Lease Agreement 27 Dated 07/01/94
that irregardless of Enplaned Passenger levels, the project may be undertaken so that construction
begins prior to October 1, 2001.
Section 9.02 Sources of Funds
City shall have the right to issue bonds, notes, certificates of participation or other Airport
obligations sufficient to fund the cost of the Program, reimburse or refinance (a) the actual cost of
designing, constructing and equipping the Capital Projects described in the Program, (b) all related
costs of issuance and associated financing costs, including but not limited to, costs of capitalized
interest, insurance, debt service coverage requirements, credit facility fees, legal fees, consulting fees,
and required deposits into any debt service reserve fund or other fund established in an ordinance or
resolution authorizing the issuance of obligations, and (c) the remaining principle amount outstanding
and accrued interest of prior years' Airport obligations.
Section 9.03 Airline Cooperation
Airline shall use its best efforts to take such action as may be reasonably requested of it by
City, consistent with this Agreement and any other agreements in effect at such time between City and
Airline, to enable City to implement the Program in a timely and cost-effective manner. Airline shall
take no action which unreasonably impedes or hinders City from such implementation.
ARTICLE X
MAINTENANCE, OPERATION, USE
AND CONDITION OF PREMISES
Section 10.01 Maintenance and Operation of the Premises
The responsibility for maintaining, operating and repairing the Premises, including the cost of
utilities and energy consumption and the insurance referred to in Article XII hereof, shall be divided
between the City and Airline in accordance with Exhibit G, and the cost of such maintenance
operations and repairs shall be paid by Airline directly for those items and facilities designated on said
Exhibit as being its responsibility and indirectly through Airline Rates and Charges for those items and
facilities designated on said Exhibit as being the City's responsibility. City and Airline agree to
undertake their respective maintenance and operating responsibilities assigned to each by Exhibit L
in such a manner so as to maintain the Premises in a good, sanitary, safe and presentable order and
condition. In fulfilling said respective responsibilities, City and Airline may act on its own behalf using
its own personnel or may contract with a third party so long as the Premises are maintained and
Airport Use and Lease Agreement 28 Dated 07/01/94
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operated in such order and condition, provided that such personnel are properly permitted to operate
at the Airport.
Section 10.02 Maintenance and Operation of Airport by City
Subject to the other provisions of this Article X, including Section 10.01 thereof, City agrees that
it will, with reasonable diligence, prudently operate, develop, improve and keep in good repair, the
Airport and all appurtenances, facilities, and services now or hereafter connected therewith; and
maintain the Airport in all respects in a manner at least equal to an acceptable standard or rating
established by the Federal Aviation Administration.
Section 10.03 Accommodations of Other Incoming Aircraft Operators
Airline agrees to make every reasonable effort to offer to any incoming Aircraft Operator the
opportunity to share use of its Exclusive Use Space as described in Section 4.01 and Section 4.02.
In determining whether the use of another incoming Aircraft Operator is reasonable and possible,
Airline will have the right to consider the compatibility of the proposed operations of those with whom
Airline has subleases or handling arrangements, Airline's existing and future flight schedules, the need
for labor harmony, the adverse competitive impacts resulting from the presence of the other Aircraft
Operator on Airline's Existing or Future Exclusive Use Space, and the availability of other such space
at the Airport. Should Airline refuse another incoming Aircraft Operator the opportunity to use said
Airline's Existing or Future Exclusive Use Space, City may review Airline's space usage, and should
it reasonably determine, considering all the factors noted herein including Airline's reasons for such
refusal, that Airline unreasonably refused usage by such other Aircraft Operator, it may require Airline
to permit the Aircraft Operator to use Airline's Existing or Future Exclusive Use Space, subject to the
incoming Aircraft Operator executing an agreement with Airline acceptable to the City.
Section 10.04 Gate Positions and Loading Ramps
(A) Assignment of Gate Positions and Loading Ramps. All assignment of gate positions and
aircraft loading ramps shall be made in strict accordance with reasonable rules, regulations and
directives adopted and promulgated by the Director of Aviation consistent with the Airline Deregulation
Act of 1978. The Director of Aviation, in making preferential but non-exclusive assignments of gate
positions to Airline users, shall take into account the needs and requirements of Airline for use of gate
positions. As of the date of this Agreement, the gate allocation formula provided by the Director of
Aviation is shown in Exhibit I attached. A guarantee of one preferential gate position for the term of
the lease, so long as the Signatory Airline operates at least 6 months of the year, shall accrue to all
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Signatory Airlines executing this agreement prior to January 1, 1994. Each Signatory Airline executing
this agreement after January 1, 1994 may be guaranteed gates based on the Director's determination
of availability, consistent with the Airline Deregulation Act of 1978. If an Airline is reassigned to a
different gate, at the request of another Airline or the Airport, for its own reasons, the requesting Airline
or the Airport, as applicable, shall pay for the reasonable costs of relocation.
Section 10.05 Aircraft Parking Positioii(s)
Airline shall perform all services pertinent to the operations in keeping the loading ramps
adjacent to its Aircraft Parking Position(s) in a neat, clean and sanitary condition free of litter, trash,
debris and other waste and refuse matter, all in keeping and consistent with first-class passenger
terminal facilities of other major airports throughout the United States.
Section 10.06 Public Areas
Subject to the rights hereby reserved by City to license, permit, authorize, regulate and locate
concessionaires and other tenants therein, including, without limiting the generality thereof, booths,
counters, offices, lockers, wall space and vending machines, Airline, its passengers, patrons, business
invitees, agents, servants, officers, employees and the public shall have the free right of use of all of
the public unrented areas, as they may exist from time to time in the Terminal Building Complex.
City undertakes to so regulate, maintain and operate said public areas to best serve the interest
of the public, building tenants, patrons and visitors at the Airport and to permit, in said public areas,
only such functions and concessions that will not interfere with the public access to Airline's exclusive
or nonexclusive use areas and as are compatible to the purpose of providing a first-class Air
Transportation facility.
Section 10.07 Signs
(A) Signs Installed by Airline. Airline shall maintain all signs installed by it in the Premises
in a neat and attractive condition and appearance. Airline shall allow other secondary users and
itinerant operators of Airline's Preferential 'Space to install identifying signs when secondary users and
itinerant operators utilize Airline's Preferential Space for an aircraft arrival or departure for the purpose
of loading and unloading passengers.
(B) Signs Installed by City. City shall install all signs necessary or required for the direction
of pedestrian and vehicular traffic on the sidewalks, ways and roads within the Terminal Building
Complex, including such signs as it determines are necessary on the roadways leading from the public
streets to said Terminal Building Complex. All directional signs in the Terminal Building Complex
Airport Use and Lease Agreement 30 Dated 07/01/94
including any additions thereto shall be installed by City. No signs or advertisements pertaining to
Airline's Air Transportation business shall be installed or maintained outside of or within the Premises
on the Airport until Airline shall have submitted to the Director of Aviation for his approval, in writing,
such drawings, sketches, design dimension and type and character of such signs and advertisements
proposed to be placed therein or thereon and any payment, conditions, restrictions or limitations in
respect to the use thereof stated by the Director of Aviation in his written approval therefor shall
become conditions hereof as if set forth herein at length.
Section 10.08 Alteration, Repair, Maintenance, Remodeling, Expansion Removal and/or
Improvement of the Facilities of Terminal Building Complex or Its Appurtenances
It is understood and agreed by and between the parties hereto that the City may alter, repair,
maintain, remodel, expand, remove or improve any of the facilities of the Terminal Building Complex
or any of its appurtenances, including space leased to Airline pursuant to this Agreement or other
agreements related to such facilities at any time during the term hereof subject to the provisions of this
Agreement.
If however, it becomes necessary for the City to reassign or relocate Airline space, City shall
give Airline reasonable advance notice of such action and shall make available alternative space that
is reasonably comparable for Airline's operations at the same rates and charges which Airline would
have paid for the space being surrendered. Airline shall surrender its space promptly to City, provided
that Airline shall be reimbursed for the reasonable cost of any such reassignment, reallocation or
relocation and the cost of Airline's unamortized investment, if any. All of such costs, as well as City's
cost of providing the alternative space aforementioned, shall be included in the cost of the particular
Capital Project requiring such reassignment, reallocation or relocation.
Section 10.09 Airport Security - Federal Aviation Regulations
(A) Security Screening Facilities. It is recognized that Airline and other Aircraft Operators
which are engaged in the transportation of persons and property by air are required by the Federal
Aviation Regulations ("FAR") to provide, at their expense, certain security measures for the screening
of persons, baggage and other property entering aircraft boarding areas of the Terminal Building
Complex.
Airline agrees to provide (along with other Aircraft Operators) such security screening facilities
and equipment in the Passenger Screening Area, including X-ray machines, other devices, and guard
services, as are required by the FAR, as amended. City shall have no obligations whatsoever relating
Airport Use and Lease Agreement 31 Dated 07/01/94
to the provision or the administration of such security screening facilities and equipment; the collection
of use charges therefor; or the payment of the costs of such facilities to vendors or service companies.
Airline agrees to comply with the requirements of FAR 107.3b and to execute any Agreements
that may be required by the FAA in relation thereto.
(B) Airport Access Control System. Airline agrees to pay its prorata share of the costs
associated with the Airport access control system as is or may be required to be implemented by FAR,
Part 107.14. The pro rated costs of implementing, operating and maintaining the access control
system will be recovered through Airline Rates and Charges, and allocated to the appropriate CRCs
in accordance with Article VI.
Section 10.10 Utilities
Airline may use all the electrical power outlets of City located in or about the Premises
including this Aircraft Parking Positions and ramp area or adjacent thereto and the cost thereof shall
be charged to the Terminal Cost Recovery Center and Airfield Cost Recovery Center based on the
area of useage.
However, wherever meters are installed in the Premises for measuring the quantity of public
utility services used by Airline, all charges for water, gas, heat, light, power, telephone or other utility
services used by Airline in connection with its occupancy of the Premises, including deposits,
connection fees or charges and meter rental required by the supplier of any such utility service, and
the costs of all equipment or improvements necessary for connecting the Premises to such utility
services facilities shall be paid by Airline. Charges shall be paid by the Airline within twenty (20) days
of receipt of City's invoice. Airline expressly waives any and all claims against City for compensation
for any and all loss or damage sustained by reason of any defect, deficiency or impairment of any
water supply system, drainage or sewer system, gas supply system, telephone, system, electrical
supply system, or electrical apparatus or wires serving the Premises. All costs for water, gas, heat
or electricity used in connection with the heating or air conditioning furnished to the Premises by City
as part of the basic charge for said Premises shall be paid by City. Notwithstanding, should Airline
use electrical power in excess of what is reasonably required for its normal operations, City reserves
the right to require Airline, at its expenses, to promptly install meters as provided above and pay for
all electrical power consumed thereafter.
Airport Use and Lease Agreement 32 Dated 07/01/94
•
Section 10.11 Trash, Garbage, Aircraft Sewage and Other Refuse
City shall provide a complete and proper arrangement for the adequate, sanitary handling and
disposal, away from the Airport, of all trash, garbage, aircraft sewage and other refuse caused as a
result of the operation of its Air Transportation business and charges therefor shall be allocated to the
appropriate Cost Recovery Center. Piling of boxes, cartons, barrels or other similar items in an
unsightly or unsafe mariner on or about the Premises by Airline is forbidden.
Section 10.12 Vehicles and Automotive Equipment on Airside Area and Aircraft Parking
Positions
City reserves the right to regulate, by adoption of rules or other means, subject to Section
3.01(K,) hereof, the use of vehicles and automotive equipment upon, over and across the Airside Area.
In the event of an emergency not specifically provided for in said rules and regulations, the Director
of Aviation or a designated representative on duty at the time of such emergency shall have the power
to take charge of the direction of such vehicle and automotive traffic in the area affected and regulate
the same until the cause of such emergency has been removed. The existence of an emergency,
other than an aircraft emergency, shall be determined by the Director of Aviation or a designated
representative.
Section 10.13 Security Deposit
Airline, on execution of this Agreement, shall deposit with City an aggregate sum in cash, letter
of credit or bond, which letter of credit or bond shall be in a form and content satisfactory to the City,
equal to two (2) month's Airline's Terminal Rates and Charges and Landing Fees specified in Article
V hereof, as a security deposit to guarantee the faithful performance by Airline of its obligations under
this Agreement and the payment of all fees and charges due hereunder. Airline shall be obligated to
maintain such security deposit in effect until the Expiration Date of this Agreement. In each Fiscal
Year, Airline will be required to adjust the amount of such security deposit to reflect Airline's current
Fiscal Year's terminal fees and charges and Landing Fees as projected by the Preliminary Projection
of Airline Rates and Charges and Mid-Year Adjustment of Airline Rates and Charges for such Fiscal
Year. If Airline has not been in default of any of the provisions of this Agreement as prescribed in
Section 19.01, or earlier Agreements for a continuous eighteen (18) month period City will waive the
requirement for security deposit and return the security deposit to Airline, if such a deposit has been
made.
Airport Use and Lease Agreement 33 Dated 07/01/94
0 0
Security deposits provided by third parties, including bonding companies and financial
institutions, shall be properly licensed to do such business in the State of California and subject to the
approval of City. In the event that any such security deposit shall be for a period of less than the full
period required by this Agreement, or if such security deposit may be cancelled, Airline shall provide
a renewal or replacement security deposit for the period following the expiration or cancellation of such
security deposit previously provided at least sixty (60) days prior to the date on which such previous
security deposit expires or at least sixty (60) days prior to the effective date of such cancellation.
If Airline shall commit an Event of Default under Section 19.01 of this Agreement, City shall
have the right to use the security deposit, or any portion thereof, to cure the default or to compensate
City for all damage sustained by City resulting from Airline's default. Airline shall immediately on
demand pay to City a sum equal to the portion of the security deposit expended or applied by City, as
provided in this Section, so as to maintain the security deposit in the sum initially deposited with City
or renew said bond.
ARTICLE XI
NO OTHER CHARGES
Section 11.01 No Other Charges
The City agrees that no fees or charges other than those expressly set forth in this Agreement,
shall be charged or collected by it from Airline or Airline's passengers or employees for the use of any
of the premises, facilities, rights, licenses and privileges granted by this Agreement, however,
notwithstanding the foregoing, City shall riot be prevented from:
(a) entering into use agreements or leases with others for space and facilities at the Airport
or from requiring and issuing permits for the use of such space and facilities, or
(b) levying uniform catering fees on in-flight food and beverage caterers which service
aircraft operating at the Airport and charge such caterers rentals for any facilities which they lease on
the Airport for their exclusive use or for their joint use with others, or
(c) assessing and collecting a head tax, passenger boarding tax, passenger facility charge,
use fee, or similar charge upon passengers using the Airport, or any of its facilities or services as, if,
and when such tax, fee or similar charge becomes lawful by the repeal or modification of the Federal
Anti-Head Tax Act (49 USCA Section 1513), or otherwise, or
Airport Use and Lease Agreement 34 Dated 07/01/94
r i
(d) entering into agreements wuth Airline for additional facilities which provide for a separate
and additional charge to Airline, or
(e) imposing a charge for public vehicular parking at the Airport or employee vehicular
parking referred to in Section 5.07 of this Agreement, or
(f) imposing ground transportation fees, or
(g) imposing a fuel flowage fee on fixed base operators and other similar service contractors
using space and facilities at the Airport who may be engaged by Airline or other aircraft operators to
provide and dispense fuel to their aircraft, or
(h) imposing a fee for the issuance of security badges, access cards, and other access
media at the Airport.
ARTICLE XII
INDEMNITY AND INSURANCE
Section 12.01 Indemnification of Airport
Airline agrees to indemnify the City, its officers, agents and employees against, and will hold
and save them and each of them harmless from, any and all actions, suits, claims, damages to
persons or properly, losses, costs, penalties, obligations, errors, omissions or liabilities, of or in
connection with the negligent performance of the work, operations or activities of Airline, its agents,
employees, subcontractors, or invitees, provided for herein, or arising from the use of the Premises
or the Airport by Airline or its employees and customers, or arising from the failure of Airline to keep
its exclusive Premises in good condition and repair, as herein provided, or arising from the negligent
acts or omissions of Airline hereunder, or arising from Airline's negligent performance of or failure to
perform any tern, provision covenant or condition of this Agreement, whether or notthere is concurrent
passive or active negligence on the part of the City, its officers, agents or employees 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:
(a) Airline 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) Airline 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
Airport Use and Lease Agreement 35 Dated 07/01/94
0 0
negligent performance of or failure to perform such work, operations or activities of
airline hereunder; and Airline agrees to save and hold the City, its officers, agents, and
employees harmless therefrom;
(c) In the event the City, its officers, agents or employees is made a party to any action or
proceeding filed or prosecuted against Airline 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 Airline hereunder, Airline 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, legal
costs and attorneys' fees.
Section 12.02 Airline Public Liability Insurance
Airline agrees to carry and keep in force public liability insurance with an insurance company
of recognized responsibility, or provide self insurance, covering personal injury, death and property
damage to protect the City, its commissioners, directors, agents, officers, and employees, from liability
covered by the indemnification provisions of this Article. Without limiting its liability as aforesaid, Airline
agrees to carry and keep in force such insurance, written on a per occurance basis, with limits of
liability for death, personal injury and property damage in a combined single limit not less than Fifty
Million Dollars ($50,000,000). An Airline shall have the right to self-insure the items specified in this
Section 12.02, Section 12.03 and Section 12.05 so long as Airline maintains a net worth satisfactory
to the City's Risk Manager.
Section 12.03 Workers Compensation Insurance
Airline shall, at the Airline'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 Airline 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 Airline in the course of conducting Airline's business in the Airport.
Section 12.04 City Public Liability Insurance
The City shall maintain in force during the term of this Agreement public liability insurance
protecting the City from claims of bodily injury and property damage liability arising out of the
ownership, maintenance, use and occupancy of the premises for amounts to be determined by the
City.
Airport Use and Lease Agreement 36 Dated 07/01/94
Section 12.05 Fire and Extended Coverage Insurance - Terminal Building Complex
The City agrees to maintain in force during the term of this Agreement fire and extended
coverage insurance on the Terminal Building Complex and any additions, alterations, or modifications
thereto and on all contents owned by the City usual and incidental to the Terminal Building Complex
for an amount of not less than ninety (90) percent of the full replacement value thereof (hereinafter
referred to as "City Insurance").
Airline shall purchase similar insurance on its contents, improvements, betterments and other
incidental personal property (hereinafter referred to as "Airline Insurance"), or shall self insure.
The City and Airline hereby mutually release and discharge each other from all claims or
liabilities arising from or caused by fire or other casualty covered by the aforementioned insurance on
the Terminal Building Complex or contents and personal property in, at or on the Terminal Building
Complex. All such policies shall include a waiver of subrogation with respect to the provisions of this
Agreement to the extent insurance proceeds are actually received.
Section 12.06 Airline Insurance on Automobiles and Other Ground Vehicles
Airline shall maintain at is sole expense and cause to be kept in force at all times during the
term of this Agreement, liability insurance in the form of primary and excess, or layered amounts of
insurance covering the operation of Airline's owned or non-owned automobiles and other ground
vehicles at the Airport, written on a per occurance basis in a combined single limit of not less than
Twenty Five Million Dollars ($25,000,000) for bodily injury and property damage liability per any one
occurrence.
Section 12.07 General Provision Applicable to Airline's Insurance
All of the policies of insurance required to be procured by Airline pursuant to this Article XII
shall (i) in a form and content common to the industry and reasonably satisfactory to the City and
written by insurers satisfactory to the City; be (ii) primary insurance; and shall (iii) name the City, its
officers, employees and agents as additional insureds to the extent of their indemnified interest. All
of said policies of insurance shall provide that said insurance may not be amended or cancelled
without providing 30 days prior written notice by registered mail to the City. Prior to the Effective Date
or such earlier date as Airline takes possession of the Premises for any purpose; and at least 30 days
prior to the expiration of any insurance policy, Airline shall provide City with certificates of insurance
or appropriate insurance binders evidencing the above insurance coverages written by insurance
companies acceptable to the City. licensed to do business in the state where the Premises are located.
Airport Use and Lease Agreement 37 Dated 07/01/94
In the event the Risk Manager of City ("Risk Manager") determines that (i) the Airline's activities in the
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 (iii) changes in the industry require different coverages be
obtained, Airline agrees that the minimum limits of any insurance policy and the types of insurance
policies required to be obtained by Airline may be changed accordingly upon receipt of written notice
from the Risk Manager; provided that Airline shall have the right to appeal a determination of increased
coverage by the Risk Manager to the City Council of City within ten (10) days of receipt of notice from
the Risk Manager. City and Airline hereby waive any rights each may have against the other on
account of any loss or damage occasioned by property damage to the Premises, its contents, or
airline'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 Airport or Airline against such loss, waive any
right of subrogation and contribution 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
in invalidated thereby.
ARTICLE XIII
QUIET ENJOYMENT
Section 13.01 Quiet Enjoyment
The City agrees that on payment of the rents, fees and other charges provided for herein and
the performance of the covenants and agreements on the part of Airline to be performed hereunder,
Airline shall peaceably have and enjoy the Premises, appurtenances, facilities, rights, licenses and
privileges granted herein.
ARTICLE XIV
INSPECTION BY CITY
Section 14.01 Inspection by City
The City may enter upon the premises including the Premises that are leased exclusively,
preferentially, or jointly to Airline and others, during normal business hours and at such times as may
be reasonable under the circumstances for any purpose necessary, incidental to or connected with the
Airport Use and Lease Agreement 38 Dated 07/01/94
performance of its obligations hereunder or in the exercise of its governmental functions relating to the
public health, safety, good conduct and the proper management of the Airport.
ARTICLE XV
RULES AND REGULATIONS
Section 15.01 Rules and Regulations
The City may adopt and enforce reasonable rules and regulations, which Airline agrees to
observe and obey, with respect to the use of the Airport and its appurtenances, facilities,
improvements, equipment and services; provided that such rules and regulations shall be consistent
with safety and with rules, regulations and orders of the Federal Aviation Administration with respect
to all operations of the Airport and, provided further, that such rules and regulations shall not be
inconsistent with the provisions of this Agreement or other agreements between the City and Airline
relating to the use of the Airport or inconsistent with the procedures prescribed or approved from time
to tirne by the Federal Aviation Administration with respect to the operation of aircraft operated by
Airline at the Airport.
In addition to the foregoing, Airline shall observe, obey, comply with and not otherwise hinder
or obstruct any and all applicable rules, regulations, laws, ordinances, statutes or orders of any
governmental authority, Federal, State or local, lawfully exercising authority over the Airport or Airline's
conduct of its Air Transportation business hereunder.
In the event City shall be subject to any fine or penalty by reason of Airline's violation of any
governmental rules, regulations or standards as now or hereafter may be promulgated or enacted, the
cost of such fine or penalty shall be borne by Airline. Furthermore, Airline agrees to indemnify,
defend, and save City harmless from any and all fines or penalties charged against City by reason of
Airline's violation of any governmental rules, regulations or standards.
City shall not be liable to Airline for any diminution or deprivation of possession, or of its rights
hereunder, on account of the exercise of any such right or authority as in this Section provided, nor
shall Airline be entitled to terminate the whole or any portion of the leasehold estate herein created,
by reason of the exercise of such right or authority, unless the exercise thereof shall so interfere with
Airline's use and occupancy of the leasehold estate herein created as to constitute a termination in
whole or in part of this Agreement by operation of law in accordance with the laws of the State of
California.
Airport Use and Lease Agreement 39 Dated 07/01/94
_ • BOND •
BOND No. 83SUN470224
PREMIUM, $124. 00
KNOW ALL HEN BY THESE PRESENTS,
That we , TRANS WORLD AIRLINES, INC. as Principal, and Hartford
£i.re Insurance Company, a corporation , duly organized and existing
under and by virtue of the laws of the State of Connecticut, as
Surety, are held and firmly bound unto the City of Palm Springs , CA
in
the sum of Twelve Thousand Three Hundred Seventy Eight .& no/1"ful money
of the United States of America, to be paid to the
City of Palm n S r' s CA for which
payment, well an� �troUry jointly and severally, firmly by these
presents .
THE CONDITION OF THE FOREGOING OBLIGATION IS SUCH THAT,
WHEREAS , said Principal is an air carrier conducting commercial
operations into and out of Palm Springs Regional Airport and is
required by saldCity of Palm Springs , CA to give this bond in
connection with certain fees and charges incurred in such
operations .
NOW, THEREFORE, the condition of this obligation is such that if
the Principal shall faithfully pay all Landing and Office Rental
fees and charges levied by the Department of Airports as a result
of Principal ' s operation at the Palm Springs Regional Airport then
this obligation shall be null and void , otherwise to remain in full
force and effect, and shall be effective 12/18/97 , and be
effective for the period OjE one year unless extended.
SUBJECT, HOWEVER, TO THE FOLLOWING CONDITIONS,
The liability of the Surety under this bond shall not be cumlative.
The Surety shall have the right to terminate its liability
under this bond, except as to any liability already incurred or
accrued, it being understood, however, that cancellation or
material change of the bond shall not become effective until
days from receipt by certified or registered mail of a wri-tter-- - =_
notice to the
from the Surety. -~ -
SIGNED, SEALED AND DATED THIS 17th day of DecemLer 1997 . _
TRANS WORLD AIRILIN/ES, INC.
HARTFORD FIRE INSURANCE COMPANY
SUSAN A. Attorney-In-Fact
14ELSH
HARTFORD FIRE INSURANCE COMPANY
_Hartford,Connecticut
POWER OF ATTORNEY
Know all men by these Presents,That the HARTFORD FIRE INSURANCE COMPANY,a corporation duly organized
under the laws of the State of Connecticut,and having its principal office in the City of Hartford,County of Hartford,State of Connecticut,
does hereby make,constitute and appoint
RALPHE.NOSAL,SUSANA. WELSHANDICATHEREVEJ.SBARBORO
ofCHICAGO,ILLINOIS
its true and lawful Attorney(s)-in-Fact,with full power and authority to each of said Attorney(s)-in-Fact,in their separate capacity if more
than one is named above,to sign,execute and acknowledge any and all bonds and undertakings and other writings obligatory in the
nature thereof on behalf of the Company in its business of guaranteeing the fidelity of persons holding places of public or private trust;
guaranteeing the performance of contracts other than insurance policies; guaranteeing the performance of insurance contracts where
surety bonds are accepted by stales and municipalities,and executing or guaranteeing bonds and undertakings required or permitted in
all actions or proceedings or by law allowed, and to bind the HARTFORD FIRE INSURANCE COMPANY thereby as fully and to the
same extent as if such bonds and undertakings and other writings obligatory in the nature thereof were signed by an Executive Officer of
the HARTFORD FIRE INSURANCE COMPANY and sealed and attested by one other of such Officers,and hereby ratifies and confirms
all that its said Attorney(s)-in-Fact may do in pursuance hereof.
This power of attorney is granted by and under authority of the following provisions:
(1)By-Laws adopted by the Stockholders of the HARTFORD FIRE INSURANCE COMPANY at a meeting duly_called and held on_
the 9th day of March,1971. -- - - - - - - - -"- - -
ARTICLE IV
SECTION S.The President or any Vice-President,siding with any Secretary or Assistant Secretary,shall have power and authority to appoint,for
purposes only of executing and attesting bonds and undertakings and other writings obligatory in the nature thereof, one or more Resident Vice
Presidents, Resident Assistant Secretaries and Attorneys-in-Fact and at any time to remove any such Resident Vice-President, Resident Assistant
Secretary,or Attomey-in-Fact,and revoke the power and authority given to him.
SECTION 11.Attorneys-in-Fad shall have power and authority,subject to the terms and limitations of the power of attorney issued to them,to
execute and deliver on behalf of the Company and to attach the seal of the Company thereto any and all bonds and undertakings, and other writings
obligatory in the nature thereof,and any such instrument executed by any such Attorney-in-Fad shall be as binding upon the Company as if signed by an
Executive Officer and sealed and attested by one other of such Officers
This power of attorney is signed and sealed by facsimile under and by the authority of the following Resolution adopted by the
Directors of the HARTFORD FIRE INSURANCE COMPANY at a meeting duly called and held on the 12th day of February,1993.
Resolved.but the signatures of such Officers and the seal of the Company may he affixed to any arch power of attorney or to any reconcile relating thereto by
facsimJe,and any such power of a0omey or oerbncate beanng such facsimile signatures or facsimile seal shall be valid and binding upon the Company and any such power so
executetl and certified by facsimile signatures and bcsimJe seal shall bu valid and binding upon the Company in the future win aspect to any bond or undenaking to which it is
altached.
In Witness Whereof, the HARTFORD FIRE INSURANCE COMPANY has caused these presents to be signed by its Vice-
President,and its corporate seal to be hereto affixed,duly attested by its Secretary,this 1 st day of May,1995.
Attest: ,,!!/��''--••MM HARTFORD FIRE INSURANCE COMPANY
1r4
Skill R u.FWmoon 3
Sknlvy �'�lAl.ltibl
STATE OF CONNECTICUT '�`�"�•v
�. Paul L.Marabella
COUNTY OF HARTFORD Vice-President
On this 1st day of May,A.D.1995,before me personally came Paul L.Marabella,to me known,who being by me duly swom,did depose
and say: that he resides in the County of Hartford, State of Connecticut; that he is the Vice-President of the HARTFORD FIRE
INSURANCE COMPANY,the corporation described in and which executed the above instrument;that he knows the seal of the said
corporation;that the seal affixed to the said instrument is such corporate seal;that it was so affixed by order of the Board of Directors of
said corporation and that he signed his name thereto by like order
w coo
STATE OF CONNECTICUT ss / lI Wozniak
.
COUNTY OF HARTFORD may. Noting,gtbic
My Commission Expires June 30,1999
CERTIFICATE
I,the undersigned,Secretary of the HARTFORD FIRE INSURANCE COMPANY,a Connecticut Corporation,DO HEREBY
CERTIFY that the foregoing and attached POWER OF ATTORNEY remains in full force and has not been revoked;and furthermore,that
the Resolutions of the Board of Directors,set forth in the Power of Attorney,are now in force.
Signed and sealed at the City of Hartford. Dated the day of 'be(_ 19
1r4 tx
cVIM FZ� ?
N N..`a
Robert L Post
Secrtary
Form S-3507-9 (111)) Printed in U.S.A.
STATE OF ILLINOIS
COUNTY OF COOK
I, Christina T. Thompson, Notary Public of Cook County, in the State of Illinois, do
hereby certify that Ralph E. Nosal, Attorney-in-fact of the Hartford Fire Insurance
Company, who is personally known to me to be the same person whose name is
subscribed to the foregoing instrument, appeared before me this day in person, and
acknowledged that he signed, sealed, and delivered said instrument for and on
behalf of Hartford Fire Insurance Company for the uses and purposed therein set
forth.
Given under my hand and notarial seal at my office in the City of Chicago in said
County, this day of _ �P A.D. 1997.
F
AL SE]
AL "
T. THOMPSON
STATE OF ILLINOIS —
EXPIRES 1/30/2001+,+v.r
Notary Public
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THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION
JOHNSON&HIGGINS OF MISSOURi ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE
200 NORTH BROADWAY,SUITE 1400 HOLDER, THIS CERTIFICATE DOES NOT AMEND, EXTEND OR
ST.LOUIS,MO 83102 ALTER T142 COVERAGE AFFORDED BY THE POLIOMS BELOW.
COMPANIES AFFORD] OVERAGE
OCMFANY
A HARTFORD ACCIDENT&INDEMNITY
kkaupim COMPANY
TRANS WORLD AIRLINES a INSURANCE CO.OF STATE OF PENNSYLVANIA
INSURANCE DEPARTMENT
11500 AMBASSADOR DR. COWAKY
P.C.BOX 213007 c
KANSAS CITY,MO 64195 pPMA n '
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THIS IS TO CERTIFY THATTHE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD
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CERTIFICATE MAY SE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED By THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,
EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.LIMITS SHOWN MAY HAVE BEEN REDUCED By PAID CLAIMS,
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CERTIFICATE HOLDER IS INCLUDED AS AN ADDITIONAL INSURED WITH RESPECTS TO AUTO LIABILITY.
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DEPARTMENT OF AVWrION "MRAIM DATE ADIRR*W, no "UING COMPANY VALL WEAVOR TO MAIL
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90 B '9 T T
CERTIFICATE OF INSURANCE
Issued By J&H Marsh&McLennan,Inc. on Behalf of Insurer
This is to certify to: City of Palm Springs.
(Certificate Holder) Department of Aviation
Attn: Catherine M. Wilson
Whose address is: P. 0.Box 2743
Palm Springs, CA 92263-2743
that Insurers,Each For Its Own Part And Not One For The Other, are providing the following insurance:
Named Insured: Trans World Airlines,Inc.
Address of Named Insured: 11500 Ambassador Drive
Kansas City,MO 64153
Period of Insurance: See Addendum A
Geographical Limits: Worldwide
Description of Coverage: Comprehensive Airline Liability Insurance including Aircraft Liability and
Comprehensive General Liability
Aircraft Insured: Any aircraft owned,used, operated or maintained by the Named Insured
Premises Insured: Any premises owned,used or occupied by the Named Insured
Limit of Liability: Combined Single Limit Bodily Injury (including passengers) and Property
Damage Liability$50,000,000 each occurrence/aircraft
Special Provisions
To the extent required, but only in connection with the Airline Use Agreement between Trans World Airlines, Inc.
and City of Pahn Springs, California, dated July 1, 1994, in connection with use of Palm Springs Municipal Airport,
Pahn Springs,California. Such insurance as is afforded under the policies shall apply as follows:
1. City of Palm Springs, its appointive or elective officers, servants, agents,employees, and other
representatives are included as Additional Insureds as respects Liability Coverages but solely with respect
to the operations of Trans World Airlines, Inc.
2. Such insurance as is afforded under the above policies applies to the Liability assumed by the Named
Insured under the subject contract.
3. In the event Insurers cancel or adversely materially change the above policies, they will give thirty (30)
days(ten(10)days with respect to non-payment of premium)advance written notice of such cancellation
or material change to the Certificate Holder.
4. The above limits include Excess Automobile Liability for a limit of$24,000,000 Combined Seigle Limit
excess of a primary limit of$1,000,000.
J&H MARSH&MCLENNAN,INC.
December 1. 1998 �. ,
Issue Date
Certificate No. 425
TWA-P.SAM
Addendum A 0
Policy Period: December 1, 1998 to December 1, 1999
12:01 a.m. Local Standard Time
Security:
Hull All Risks and Liability
Insurers Policy Number Participation
United States Aviation Underwriters STHL-1-8533 25%
Lloyd's and otherLondon Companies AW769498 35%
Generali France Assurances 98/27832 15%
Assurance France Aviation 98.0828 10%
Associated Aviation Underwriters SP-6406 10%
Mutual Marine Office 11323AV598 5%
The above described coverages are subject to policy terms, conditions, limitations and exclusions.
Each of the above Insurers, individually and for its policy only, has authorized the undersigned to issue
this Certificate on its behalf as a matter of convenience. The undersigned is not an insurer and has no
liability as an insurer as a result of issuing this Certificate or under the above policies.
If Certificates have been issued prior to the Date of Issue of this Certificate, this Certificate cancels and
supersedes each such Certificate.
J&I-I MARSH & McLENNAN, INC.