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HomeMy WebLinkAbout03325 - WESTAIR COMMUTER UNITED EXPRESS AIRPORT USE LEASE R18205 • Westair Commuter Airlines dba United Express Airport Use & Lease Agr AIRPORT USE AND LEASE AGREEMENT AGREEMENT #3325 CM Signed R18205, 10-20-93, 12-21-93 THIS AIRPORT USE AND LEASE AGREEMENT ("Agreement") made and entered into as of the 1s` day of July, 1994, by and between the CITY OF PALM SPRINGS, a municipal corporation organized WESTAIR COMMUTER AIRLINES, INC. and existing underthe laws of the State of California ("City"), and dbe UNITED EXPRESS a corporation organized and existing under the laws of the State of California ("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 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 Positions) 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 of 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 9 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. Airport Use and Lease Agreement 3 Dated 07/01/94 • • 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 facilites, public telephones, facilities for the furnishing of ground transportation services, hotels, and parking areas. Section 1.16 Concourses shall rnean 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 Concou7se Crate 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 arch itect/engineer. Airport Use and Lease Agreement 4 Dated 07/01/94 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 of the Director of Aviation under,this Agreement, orsuch otherperson, 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 July 1, 1994. Section 1.23 Enplaned or Enplaning Passenaers 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 Uses 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 Existina Joint Use INalkwav 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 Airport Use and Lease Agreement 5 Dated 07/01/94 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 1st day of July of any year or any 12-month period the City may designate. Section 1.33 Independent Accouintant 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 Airport Use and Lease Agreement 7 Dated 07/01/94 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; Airport Use and Lease Agreement 8 Dated 07/01/94 • ! (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 in-formation 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 ®aerations 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 Lounge(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. Airport Use and Lease Agreement 9 Dated 07/01/94 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 1, which includes Passenger Departure Lounges, Public Areas (including a portion of security screening), concession areas, and othertenant and City space thereon, if applicable. Section 1.50 Signatory Airlinetsll 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 11 of this Agreement. Section 1.51 Special Capital Projects 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 1.64 Total Landed Weig &shall mean the sum of the Certificated Maximum Landing Weights for all Fee Landings over a stated period of time. Airport Use and Lease Agreement 10 Dated 07/01/94 ARTICLE 11 TERM Section 2.01 Term of Agreement The term of this Agreement shall commence on the Effective Date, July 01, 1994, 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 Airport Use and Lease Agreement 11 Dated 07/01/94 0 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 senlices 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 (Nail. 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 0 • 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. (J) 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 forthe 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. Airport Use and Lease Agreement 13 Dated 07/01/94 ! • (IAA) Flight to Provide Curbside Bagciacie Check-ln 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 CRy and the rules and regulations of City. (CI) Eight to Provide Seoarices on Behalf of Other Aircraft Operators The rights and privileges granted Airline under this Article 1, with respect to the performance of ground services and activities in connection with its Air Transpou tabor 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 partics hereto to impede, hinder or negate the legislative intent of the Airline Deregulation Act of 197ft. (0) No Other Business Authorized. Clothing 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 senciee, and nothing herein contained shall be construed as authorizing Airline in its conduct of its Air Transportation service m inmrfere unreasonably with other persons or tenants leasing or lawfully using Airport facilities. Clothing 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. All activities of Airline pursuant to this section 3.01 shall be performed in compliance with ail applicable Federal, State and local laws, ordinances, and regulations. Ar,THC LE lV cURM MEFS PFRIER XES Section 4.01 PoJod,l Fronn oafs, Lo i=)fs 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 rootage of floor area as shown and delineated on Exhibit C shall apply to this agreement. (B) Joint Use Baggage Clairon/Common Area. A portion of the joint use space in the Terminal Building Complex known as Existing Joint Use Baggage Claim/Common Area containing Airport Use and Lease Agreement 14 Dated 07/01/94 • r 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 Wall(way., 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 Pe7lad rrom. IX30 UnVo E:np rraUgn Dana of Thy a 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 Sloace 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. AF,17tCLH= V CALCULA70H OF AORL@NE RA7ES AND CHARGES Section 6.01 Gancra9 C®mm tment For the purpose of fairly allocating 9m 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 Fircrin Effec&o Data Co ©D® 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 Airport Use and Lease Agreement 15 Dated 07/01/94 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 Di3C Until l_xplration 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 Airport Use and Lease Agreement 17 Dated 07/01/94 0 • 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 coming 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, from 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 dletermines 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 Airport Use and Lease Agreement 18 Dated 07/01/94 0 0 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 Forst Amended and Restated Installment Sale Agreement by and between the City of Palm Springs (the "City") 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 Adiustment 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, Airport Use and Lease Agreement 19 Dated 07/01/94 0 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 The 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 Excki tad 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 factors 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 Airiinas 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 Claim/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 IDENTIRCATION AND ALLOCATION OF REVENUES AND EXPENSES Section 6.01 Maintenance and Operad ns Expenses. Reserve Fund Deposit Requirements and Non-Use Agreement Revenuues 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 Dispositian of airport Revenuea 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 Deist 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 Maintena"ce and Oper&d ns Deserve 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 i 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 6.06 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 WII 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; Airport Use and Lease Agreement 22 Dated 07/01/94 0 0 (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 numbeir 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 (1st) 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 Airport Use and Lease Agreement 23 Dated 07/01/94 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, fees 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-®ems 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 0 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 tome the City will make additional expenditures for capital improvements and capital asset purchase:, 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, pales 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 • 0 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 0 • 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 • • 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 rnanner 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 Facture 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 Airport Use and Lease Agreement 29 Dated 07/01/94 • ! 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 Position(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 0 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 • 0 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 0 Section 10.11 Trash, Garbaae 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 manner on or about the Premises by Airline is forbidden. Section 10.12 Vehicles and Automotiare 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 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 not 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 0 • (d) entering into agreements with 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 INDEM14ITY 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 property, 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 term, provision covenant or condition of this Agreement, whether or not there 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 16 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 12.06 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 oc:curance 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 0 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 Eniovment 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 0 • . 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 treasonable 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 time 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 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 not 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 concert, 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 assiglnee'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 terms 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 togetherwith 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 SURRE14DER 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. Airport Use and Lease Agreement 41 Dated 07/01/94 i • 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 to 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 DEFAULIr 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 • 0 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 Airport Use and Lease Agreement 43 Dated 07/01/94 discounting such amount at the discount irate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%), but in no event greater than ten percent (10%). 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 (S) Cessation of Use. If Airline 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 Cancelladon by Airriine 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 lave 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 46 Dated 07/01/94 • • (a) The material restriction of Airline's ruse of the Premises and facilities herein and the continuance thereof for a period of not doss than suety (60) days by reason of any future agreement between the City and the United States. QR` M712 2tf Section 20.01 ®amago ar DoMpuu8l©rn rda f1rGFjaige,- A. Partialhf Insured Casualtas. 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 irnprovernents, alterations or additions,trade fixtures, signs or other personal property) suPdsiantdally to the condition "thereof immediately prior to said damage or destruction, hmKod, 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 Promises or the buildings constituting the Airport shall be destroyed or damaged as a result of a rdsk not required to be insured i®y 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 shad) be performed by City's contractor. Airline, at its sole cost and Airport Use and Lease Agreement 46 Dated 07/01/94 • • expense, shall be responsible for the replacement 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 lutes 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. AR a ICLE M PR OMTED LASES 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, orwith 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 • 0 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 Comiiance 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 Ac"t 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; (vl) California Health and Safety Code Section 25915; (vii) Airport Use and Lease Agreement 4.8 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 Alrllne 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, painting 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 shah 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 bit 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 IFAA 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, Airport Use and Lease Agreement 51 Dated 07/01/94 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 any 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 Rands 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. Bn 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 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 Invalidity of Clauses The invalidity of any Article, Section, portion, paragraph, provision, or clause of this Agreement shall have no effect upon the validity of ary 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 26.04 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 there, 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 tae 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: U '--�tY= ialri rN t-=s r c ti. Attention: 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. Airport Use and Lease Agreement 56 Dated 07/01/94 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 Agreement This Agreement, together with all Exhibits and Appendices hereto, constitutes the entire agreement between the parties hereto relaiting 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 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 City M ger Approved as to Form RUTTAN & TUCKER a id J. Aleshire ity Attorney (Al L)NE) By AppP 'OVED BY THE CYN COlJNCII 6Y RES. RO. t Y)G�- C n �r tiz�ld -d-r Airport Use and Lease Agreement 58 Dated 07/01/94 EXHIBIT A LbAWDSI U ERii INAUAIRSIDE w 51 AIRSIDE e TERMINAL LANDSIDE j— , EXHIBIT B Page 1 of 3 EXCLUSIVE USE SPACE u 'o 0 79 s �a `' 0 EXHIBIT B Pa e2of3 JOINT USE BAGGAGE CLAIM/COMMON AREAS 0�0 a i DO. j EXHIBIT B Page 3 of 3 JOINT USE WALKWAY u � � o r a° r . a or ooao 0 EXHIBIT C EXCLUSIVE USE SPACE IFv � SPACE SQ.FT. 1 Exclusive Outbound 2453.00 2 Exclusive 1208.0 FT 1 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 2 Outbound 450.0 8 Exclusive 821.0 Outbound 450.0 - 9 Exclusive 286.0 Outbound 136.0 t 3 C � 5 6 f "L 7 8 9* 1 - * Note: This section is counter space and front office only. 0 EXHIBIT D FIRST LEVEL. CONCOURSE BUILDING o " ,o a° a o° o° ° i i I l / i 0 • EXHIBIT" E SECOND LEVEL CONCOURSE BUILDING u o 1_ 0 a° . o o° o° 0 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. 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 EXHi0T 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 So 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 EXHIMT I PPEFSI2EH T IAL 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 Concevu se Gate PoMMona Airlines who are a Signatory Airline as of the Pffrective 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 "tames 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 gong 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; 0 0 2. An adjustment of a parrdcular 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 ol'Airline's Concourse Gate Positlon(s) (or component thereon when they are not required by Airline. However, Alrllne well not be required to make such Concourse Gate Positions(s) available to an itinerant operator of a Concourse Gate Position(s) (or component thereon not preferentially used by another Aircraft Operator and meeting alb 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 P'osKt on(s) is available during the time period involved. In determining which Concourse Gate Position (or ccrn pone nt thereon will be assigned to the itinerant operator, City shall consider- the High'¢ 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 thereon, 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. PrefererAW Use of Gornmautav Cord omwos G,&CG F„@Rt Ono 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 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%. i 000000000000 Airline Use Agreement Number 33 23-- Standard Form Approved October 20, 1993 Resolution #t 18205 .E'''k 1^+s.?^+� I.M<_4.i+r,.,M4...:N`I; *M.11>>� M`}s s*"4_ ih'yt 1W��iWlc>lVI� hl.l:,4,� .W�c'lyvl�'11v'f!rAc�l"I�Y,WF J3 �— C S SJ 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 WESTAIR COMMUTER AIRLINES, INC. dbe UNITED EXPRESS [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 Section1.20 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 Section1.32 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 1.33 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 ARTICLEII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 2.01 Term of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 ARTICLEIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 3.01 Rights of Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 ARTICLEIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 ARTICLEVI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 ARTICLEVII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 ARTICLEVIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 ARTICLEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 0 Section 10.06 Public Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Section10.07 Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Section 10.06 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 ARTICLEXI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Section 11.01 No Other Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 ARTICLEXII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Section 12.01 Indernnificatlon of Airport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Section 12.02 Airline Public Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Section 12.03 Workers Cormpensation Insurance 36 Section 12.04 City Public Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Section 12.05 Fore 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 ARTICLEXIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Section 13.01 Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 ARTICLEXIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Section 14.01 Inspection by City . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 ARTICLEXV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Section 15.01 Rules and Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 ARTICLE1XVI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Section 16.01 Assignment and Sublease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 ARTICLEXVII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Section 17.01 Surrender of Possession - Holding Over . . . . . . . . . . . . . . . . . . . . . . . . . . 41 ARTICLEXVIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Section18.01 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 ARTICLEXIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 ARTICLEXX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 Section 20.01 Damage or Destruction of Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 ARTICLEon 2 Prohibited Uses . . . . .11.01 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Sec Section 21.02 OII, Fuel and Other Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Section 21.03 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 ARTICLEXXII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 Section 22.01 Improvements by Airline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 Section 22.02 Conditions Covering Improvements and Alterations . . . . . . . . . . . . . . . . . . 49 Section 22.03 Ownership of Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 ARTICLEXXIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Airport Use and Lease Agreement iii Dated 07/01/94 0 0 Section 23.01 Non-Discri m!nation and FAA Required Clauses . . . . . . . . . . . . . . . . . . . . . 51 Section 23.02 Feder2i Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 ARTICLEXXIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 Section 221.01 Condernnadon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 ARTICLEXXV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.01 Non-Waiver of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.02 Invalidity of Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.03 Approval by the Paff as . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.04 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.05 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 25.06 Governing Levy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 26.14 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 1 Preferential Use of Concourse Gate Positions Airport Use and Lease Agreement v Dated 07/01/94 w CERTYFIC4E O ]INSUUNCE CSR PG ISBUEDAT6/13 a'�'�'��� WESTR-1 06/13/94 PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER.THIS CERTIFICATE SCHREIBER BRANCH/WMK DOES NOT AMEND,EXTEND OR ALTER THE COVERAGE AFFORDED BY THE P.O. BOX 10 POLICIES BELOW. FARMINGTON NM 87499 COMPANIES AFFORDING COVERAGE 505-325-1849 COMPANY A USF&G Insurance Company LETTER p COMPANY INSURED LETTER � 'J 'f7 COMPANY Cv LETTER WESTAIR COMMUTER AIRLINES COMPANY LORRAINE TRAVIS LETTER D 5570 AIR TERMINAL FRESNO CA 93727 LETTER"Y E COVERAGES' ., THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED,NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE 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. GO TYPE OF INSURANCE POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION LIMITS L R DATE(MM/DD/YY) DATE(MM/DD/YY) GENERAL LIABILITY GENERAL AGGREGATE $ COMMERCIAL GENERAL LIABILITY PRODUCTS-COMP/OP AGO. $ CLAIMS MADE OCCUR. PERSONAL&ADV.INJURY S OWNER'S&CONTRACTOR'S PROT. EACH OCCURRENCE $ FIRE DAMAGE(Any one fine) $ MED.EXPENSE(Anyone person) $ AUTOMOBILE LIABILITY COMBINED SINGLE A X ANY AUTO 1CP 300152127 01 03/23/94 03/23/95 LIMIT S1,000,000 ALL OWNED AUTOS BODILY INJURY SCHEDULED AUTOS (Per person) $ X HIRED AUTOS BODILY INJURY X NON-OWNED AUTOS (1'er acc,den[) GARAGE LIABILITY PROPERTY DAMAGE $ EXCESS LIABILITY , EACH OCCURRENCE .$ UMBRELLA FORM AGGREGATE $ OTHER THAN UMBRELLA FORM WORKER'S COMPENSATION STATUTORY LIMITS EACH ACCIDENT S AND DISEASE—POLICY LIMIT $ EMPLOYERS'LIABILITY DISEASE—EACH EMPLOYEE $ OTHER A Property 1CP 300152127 01 03/23/94 03/23/95 A Misc. Equip. 1CP 300152127 01 03/23/94 03/23/95 inc. DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS Commuter Airlines Waiver of subrogation and additional insured are added in favor of City of Palm Springs. CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF,THE ISSUING COMPANY WILLENDEAVOR TO Palm Springs, City of MAIL30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE Dept. of Aviation LEFT,BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR Attn: Catherine M. Wilson LIABILITY OF ANY KIND UPON THE COMPANY,ITS AGENTS OR REPRESENTATIVES. P.O. Box 2743 Palm Springs CA 92263-2743 AUTIIORIZEDREPRE '�.r 411 I CORD 25-S(7/90) ORD CORFORATTON Y`99`0 W RE�a(y l4� .JA.:�L/ JUN 15 1994 DEPARTMENT OFT AVIATION MAR-24-9B TUE 12:47 PM SCHREIBER INSURANCE FAX N0, 5053265825 P. 05 ACORa_ I CERTIFIC TE OF LIABILITY INSU NC R DR DATEiMMIDONY) 3TA-1 03/05/98 PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE Schreiber Insurance Agency HOLDER.THIS CERTIFICATE DOES NOT AMEND,EXTEND OR P.C. Box 10 ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW, Fazmington NM 87499 _ COMPANIES AFFORDING.COVERAGE COMPANY Pxnno Nn. 505-325-1849 Fap NC_.„ A OSFLG Insurance Company UNMREOWE5TAIR COW OTP',R AIRLINES m ' " of its wholly owned subsid COMPANY iari es (all wholly awned aubsidiar - Ses of Mesa Air GTOV.p, Inc. co OANY ,. COMPANY Pam Stone C --- 5598 Aircorp Way FRESNO CA 93727 --- - COVERAGES THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED,NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACTOR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE 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. CO TYPE OF INSURANCE POLICY NUMBER POLICYEFFECTNE POUOYEAPIRANON T LTR DATE(MMILWIYY) DATE(MMICVNY) LIMITS GENERAL LIABILITY GENERAL AGOREGATE S COMMERCIAL GENERAL LIABILITY PRUpOCTS-COMPIOP AGO S CLAIMS MADE OOCCUR PERSONAL S ADV INJURY_ $ — OWNERSRCONTRACTOR'SPROT EACH OCCURRENCE S ^ FIRE DAMAGE(Anyone ire) S MED SAP(Any one Person) S AUTOMOBILE uABILITY A X ANY AUTO 1CP3 0 0 152127 0 5** 03/23/98 03/23/99 COMRIN(:D SINOLE LIMIT s 2,000,000 ALL OWNED AUTOS ""•'"' BODILY INJURY S SCHEDULED AUTO& AVIATION P5LTCT PAwxuaB 09/15/97 09/15/98 (Pelperon) X HIRED AUTOS EXCESS ADTO UP 7!0 BODILY INJURY ' X NON-OWNED AUTOS $25,000,000 (Peracnlden0 5 PROPERTYOAMAGE S =A�0 AUTO ONLY-EA ACCIDENT 5 OTHER THAN AUTO ONLY: EACH ACCIDENT S — AGGREGATE S m EkcE55 LIABILITY EACH OCCURRENCE _ 5 — UMDRELLAFORM AGGREGATE l S n OTHER THAN UMBRELLA FORM S WORKERS COMPENSATION AND wC SYAT ITS URY LIMITS ER EL EACH ACCIDENT S TFIE FROPRIETPW _ INCL PARTNERS/EXECUTIVE EL DISEASE-POLICY LIMIT S OFFICERS ARE• EXCL EL DISEASE,EA EMPLOYEE S OTHER A Property 1CP300152 12705 03/23/99 03/23/99 various self-insd DESCRIPTION OF OPERATIONSILOCATIONMOHICLEWSPECIAL ITEMS ComIm;ter Airlines Waiver of subrogation and Additional inElured are added in favor Of the City of Palm Springs, CERTIFICATE HOLDER CANCELLATION PALMS-1 SHOULD ANY OF THE ADOYE DESCRIBED POLICIE50E CANCELLED BEFORE THE EXPIRATION DATB THEREOF.THE ISSUING COMPANY WILL IITO MAIL Palm Springs, City of Dept of Aviation 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, Attn: Catherine N. Wilson B UT PAILUR E TO MAIL SUCH NOTICE SHALL IMPOSE NO ORLIUATION OR LIABILITY P.O. BOX 2743 OF ANY KIND UPON jokCOMPANY,ITS AGE S OR REPRESENTATIVES. Palm Springs CA 922 63-2 7 4 3 AUTHORIM RE se u E ACORD 2"(1/96) OArA A •C O ION TiYY OCT-06-98 TUE 11 .55 AM SCHREIBER INSURANCE FAX N0. 5053265826 p, 01 C 0 V E R FAX S H E E T To: Judith Sumich '- Fax#: 760-322-8320 Subject; Westair Commuter J)xte: October 6, 1998 Pages: 2, including this cover sheet. COMMENTS: Judith: Westair Commuter no longer flies in Palm Springs therefore no renewal insurance certificate Was sent and it is no longer needed. to,a4tet-� From the desk of... Diana Hobbs,ctc Schreiber Insurance Agency,Ina P0Box 10 Farmington,NM 87499 (505)325-1849 Fax:(505)328.5825