TIME SHARING AGREEMENT
This Agreement is made, effective as of November 29, 1999, by and between
ESA Management, Inc., a corporation organized under the laws of the State of
Delaware, with principal offices at 000 Xxxx Xxx Xxxx Xxxx., Xx. Xxxxxxxxxx, XX
00000 (hereinafter referred to as "Lessor"), and XXXXXX XXXX XXXXXXX, JR., with
principal offices at 000 Xxxx Xxxx Xxxxxx, Xxxxxxxxxxx, XX 00000 (hereinafter
referred to as "Lessee");
RECITALS
WHEREAS, Lessor is the owner of that certain civil Aircraft bearing the
United States Registration Number NI22SU ("the Aircraft" or "Aircraft"), a
LearJet, Model 55B, Manufacturer's Serial Number 132;
WHEREAS, Lessor employs a fully qualified flight crew to operate the
Aircraft; and
WHEREAS, Lessor and Lessee desire to lease said Aircraft with flight crew
on a non-exclusive time sharing basis as defined in Section 91.501(c)(1) of the
Federal Aviation Regulations ("FAR");
The parties agree as follows:
1. Lessor agrees to lease the Aircraft to Lessee pursuant to the
provisions of FAR 91.501(c)(1) and to provide a fully qualified flight
crew for all operations. This Agreement shall commence on the date
that it is signed and continue for one year after said date.
Thereafter, this Agreement shall be automatically renewed on a month
to month basis, unless sooner terminated by either party as
hereinafter provided. Either party may at any time terminate this
Agreement upon thirty (30) days written notice to the other party,
delivered personally or by certified mail, return receipt requested,
at the address for said other party as set forth above.
2. Lessee shall pay Lessor for each flight conducted under this Agreement
the actual expenses of each specific flight as authorized by FAR Part
91.501(d). These expenses include:
(a) Fuel, oil, lubricants, and other additives;
(b) Travel expenses of the crew, including food, lodging and ground
transportation;
(c) Hangar and tie down costs away from the Aircraft's base of
operation;
(d) Insurance obtained for the specific flight;
(e) Landing fees, airport taxes and similar assessments including,
but not limited to IRC Section 4261 and related excise taxes;
(f) Customs, foreign permit, and similar fees directly related to the
flight;
(g) In-flight food and beverages;
(h) Passenger ground transportation;
(i) Flight planning and weather contract services; and
(j) An additional charge equal to 100% of the expenses listed in
subparagraph (a) of this paragraph.
3. Lessor will pay all expenses related to the operation of the Aircraft
when incurred, and will provide an invoice and xxxx Lessee for the
expenses enumerated in paragraph 2 above on the last day of the month
in which any flights for the account of Lessee occur. Lessee shall
pay Lessor for said expenses within fifteen (15) days of receipt of
the invoice and xxxx therefor.
4. Lessee will provide Lessor with requests for flight time and proposed
flight schedules as far in advance of any given flight as possible,
and in any case, at least twenty-four (24) hours in advance of
Lessee's planned departure. Requests for flight time shall be in a
form whether written or oral, mutually convenient to, and agreed upon
by the parties. In addition to the proposed schedules and flight
times Lessee shall provide at least the following information for each
proposed flight at some time prior to scheduled departure as required
by the Lessor or Lessor's flight crew:
(a) proposed departure point;
(b) destination;
(c) date and time of flight;
(d) the number of anticipated passengers;
(e) the nature and extent of luggage and/or cargo to be carried;
(f) the date and time of return flight, if any; and
(g) any other information concerning the proposed flight that may be
pertinent or required by Lessor or Lessor's flight crew.
5. Lessor shall have final authority over the scheduling of the Aircraft,
provided, however, that Lessor will use its best efforts to
accommodate Lessee's needs and to avoid conflicts in scheduling.
6. Lessor shall be solely responsible for securing maintenance,
preventive maintenance and required or otherwise necessary inspections
on the Aircraft, and shall take such requirements into account in
scheduling the Aircraft. No period of maintenance, preventative
maintenance or inspection shall be delayed or postponed for the
purpose of scheduling the Aircraft, unless said maintenance or
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inspection can be safely conducted at a later time in compliance with
all applicable laws and regulations, and within the sound discretion
of the pilot in command. The pilot in command shall have final and
complete authority to cancel any flight for any reason or condition
which in his judgment would compromise the safety of the flight.
7. Lessor shall employ, pay for and provide to Lessee a qualified flight
crew for each flight undertaken under this Agreement.
8. In accordance with applicable Federal Aviation Regulations, the
qualified flight crew provided by Lessor will exercise all of its
duties and responsibilities in regard to the safety of each flight
conducted hereunder. Lessee specifically agrees that the flight crew,
in its sole discretion, may terminate any flight, refuse to commence
any flight, or take other action which in the considered judgment of
the pilot in command is necessitated by considerations of safety. No
such action of the pilot in command shall create or support any
liability for loss, injury, damage or delay to Lessee or any other
person. The parties further agree that Lessor shall not be liable for
delay or failure to furnish the Aircraft and crew pursuant to this
Agreement when such failure is caused by government regulation or
authority, mechanical difficulty, war, civil commotion, strikes or
labor disputes, weather conditions, or acts of God.
9. At all times during the term of this Lease, Lessor shall cause to be
carried and maintained, at Lessor's cost and expense, physical damage
insurance with respect to the Aircraft in the amount set forth below:
Aircraft Physical Damage $5,650,000.00
(No Deductible While
In Motion or Not in Motion)
At all times during the term of this Lease, Lessor shall also cause to
be carried and maintained, at Lessor's cost and expense, third party
aircraft liability insurance, passenger legal liability insurance,
property damage liability insurance, and medical expense insurance in
the amounts set forth below:
Combined Liability Coverage for
Bodily Injury and Property Damage
Including Passengers -
Each Occurrence $100,000,000.00
Medical Expense Coverage -
Each Person $5,000.00
Lessor shall also bear the cost of paying any deductible amount on any
policy of insurance in the event of a claim or loss.
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Any policies of insurance carried in accordance with this Lease: (i) shall
name Lessee as an additional insured; and (ii) shall contain a waiver by the
underwriter thereof of any right of subrogation against Lessee; and (iii) shall
provide that in respect of the interests of Lessee, such policies of insurance
shall not be invalidated by any action or inaction of Lessor or any other person
and shall insure Lessee (subject to the limits of liability and war risk
exclusion set forth in such policies) regardless of any breach or any violation
of any warranty, declarations or conditions contained in such policies by Lessor
or any other person; and (iv) shall provide that if the insurers cancel
insurance for any reason whatsoever, or the same is allowed to lapse for non-
payment of premium, or if there is any material change in policy terms and
conditions, such a cancellation, lapse or change shall not be effective as to
Lessee. Each liability policy shall be primary without right of contribution
from any other insurance which is carried by Lessee or Lessor and shall
expressly provide that all of the provisions thereof, except the limits of
liability, shall operate in the same manner as if there were a separate policy
covering each insured.
Lessor shall submit this Lease for approval to the insurance carrier for
each policy of insurance on the aircraft. Lessor shall arrange for a
Certificate of Insurance evidencing appropriate coverage as to the Aircraft and
the satisfaction of the requirements set forth above to be given by its
insurance carriers to Lessor.
10. Lessee warrants that:
(a) It will use the Aircraft for and on account of its own business
only, and will not use the Aircraft for the purpose of providing
transportation of passengers or cargo in air commerce for
compensation or hire;
(b) It shall refrain from incurring any mechanics or other lien in
connection with inspection, preventative maintenance, maintenance
or storage of the Aircraft, whether permissible or impermissible
under this Agreement, nor shall there be any attempt by any party
hereto to convey, mortgage, assign, lease or any way alienate the
Aircraft or create any kind of lien or security interest
involving the Aircraft or do anything or take any action that
might mature into such a lien; and
(c) During the term of this Agreement, it will abide by and conform
to all such laws, governmental and airport orders, rules and
regulations, as shall from time to time be in effect relating in
any way to the operation and use of the Aircraft by a timesharing
Lessee.
11. For purposes of this Agreement, the permanent base of operation of the
Aircraft shall be Spartanburg, SC.
12. Neither this Agreement nor any party's interest herein shall be
assignable to any other party whatsoever. This Agreement shall inure
to the benefit of and be binding upon the parties hereto, their heirs,
representatives and successors.
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13. TRUTH IN LEASING STATEMENT
THE AIRCRAFT, A LEARJET 55B MODEL, MANUFACTURER'S SERIAL NO. 132,
CURRENTLY REGISTERED WITH THE FEDERAL AVIATION ADMINISTRATION AS N122SU HAS
BEEN MAINTAINED AND INSPECTED UNDER FAR PART 91 DURING THE 12 MONTH PERIOD
PRECEDING THE DATE OF THIS LEASE.
THE AIRCRAFT WILL BE MAINTAINED AND INSPECTED UNDER FAR PART 91 FOR
OPERATIONS TO BE CONDUCTED UNDER THIS LEASE. DURING THE DURATION OF THIS
LEASE, XXXXXX XXXX XXXXXXX, JR., 000 Xxxx Xxxx Xxxxxx, Xxxxxxxxxxx, XX
00000, IS CONSIDERED RESPONSIBLE FOR OPERATIONAL CONTROL OF THE AIRCRAFT
UNDER THIS LEASE.
AN EXPLANATION OF FACTORS BEARING ON OPERATIONAL CONTROL AND PERTINENT
FEDERAL AVIATION REGULATIONS CAN BE OBTAINED FROM THE NEAREST FAA FLIGHT
STANDARDS DISTRICT OFFICE.
THE "INSTRUCTIONS FOR COMPLIANCE WITH TRUTH IN LEASING REQUIREMENTS"
ATTACHED HERETO ARE INCORPORATED HEREIN BY REFERENCE.
I, THE UNDERSIGNED, XXXXXX XXXX XXXXXXX, JR., 000 Xxxx Xxxx Xxxxxx,
Xxxxxxxxxxx, XX 00000 CERTIFY THAT IT IS RESPONSIBLE FOR OPERATIONAL
CONTROL OF THE AIRCRAFT AND THAT IT UNDERSTANDS ITS RESPONSIBILITIES FOR
COMPLIANCE WITH APPLICABLE FEDERAL AVIATION REGULATIONS.
IN WITNESS WHEREOF, the parties have executed this Agreement.
ESA Management, Inc.
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxx, Vice-President
By: /s/ Xxxxxx Xxxx Xxxxxxx, Jr.
---------------------------------
Xxxxxx Xxxx Xxxxxxx, Jr.
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