AIRCRAFT INTERCHANGE AGREEMENTAircraft Lease Agreement |
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EXHIBIT 10.2
AIRCRAFT INTERCHANGE AGREEMENT
This AIRCRAFT INTERCHANGE AGREEMENT (the "Agreement") is made and entered into as of January 1, 2005, by and between Interface Operations LLC ("Interface"), and Las Vegas Sands Corp. ("LVSC").
In consideration of the mutual promises, agreements, covenants, warranties, representations and provisions contained herein, the parties agree as follows:
1. Interchange of the Aircraft. Each party represents to the other party that such party owns, leases or otherwise has exclusive possession and control of the aircraft set forth next to such party's name in Exhibit A (any one or more of such aircraft shall be referred to as the "Aircraft"). Subject to the terms and conditions contained herein, each party shall make available to the other party its Aircraft, with a flight crew, on an as-available basis, in exchange for equal flight time on such other party's Aircraft, together with a charge calculated in accordance with section 8(a) and Exhibit A to reflect the differential cost of owning, operating and maintaining the aircraft listed in Exhibit A which shall be paid as set forth in section 8(b). This Agreement is intended to be an interchange agreement within the meaning of 14 C.F.R. Section 91.501(c)(2).
2. Term. The term of this Agreement (the "Term") shall commence on the date of this Agreement and end one year thereafter (the "Expiration Date"). The Expiration Date (as it may be extended) shall be automatically extended by one year if neither party has given notice of non-renewal to the other at least 30 days before the then Expiration Date. Notwithstanding anything to the contrary in this section 2, either party may terminate this Agreement on 30 days' notice, provided that such party is not then in default.
3. Delivery. Upon the request of a party to the other party, subject to the availability of such other party's Aircraft at the time of such request for the flights proposed by such party, such other party shall deliver its Aircraft to such party at such location as such party may reasonably request. LVSC acknowledges that Interface currently bases its Aircraft at McCarran International Airport, Las Vegas, Nevada and Interface acknowledges that LVSC currently bases its Aircraft at McCarran International Airport, Las Vegas, Nevada (each base with respect to an Aircraft, as such base may be changed from time to time, shall be referred to as a "Home Base").
4. Return. On the earlier of the Expiration Date or the termination of this Agreement pursuant to section 14(a)(i) and, unless the other party agrees to the contrary, upon the conclusion of each flight of such other party's Aircraft on behalf of a party under this Agreement, such other party's Aircraft shall be returned to its Home Base or such other location as the parties may agree. For the sake of clarification, flight time to ferry an Aircraft to the delivery location specified by a party pursuant to section 3, and flights to return the Aircraft to the Home Base or such other location as the parties agree pursuant to this section 4, shall be deemed to be use of the Aircraft by such party.
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5. |
Use of Aircraft. |
(a) Each party shall use the other party's Aircraft only for the transportation of its employees and guests and shall not obtain compensation for such transportation from any person.
(b) With respect to the use by a party of the other party's Aircraft under this Agreement, such party shall not violate, and such party shall not permit any of its employees, agents or guests to violate, any applicable law, regulation or rule of the United States, and state, territory or local authority, or any foreign government or subdivision thereof and such party shall not bring or cause to be brought or carried on board such other party's Aircraft, or permit any employee, agent or guest to bring or cause to be brought or carried on board such other party's Aircraft, any contraband or unlawful articles or substances, or anything that is contraband or is an unlawful article or substance in any jurisdiction into or over which such other party's Aircraft is to operate on behalf of such party.
(c) Each party shall, and each party shall cause its employees, agents and guests to, comply with all lawful instructions and procedures of the other party and its agents and employees regarding such other party's Aircraft, its operation or flight safety.
(d) Each party acknowledges that its discretion in determining the origin and destination of its flights on the other party's Aircraft under this Agreement shall be subject to the following: (i) such origin and destination, and the routes to reach such origin and destination, are not within or over (A) an area of hostilities, (B) an area excluded from coverage under the insurance policies maintained by such other party with respect to such other party's Aircraft or (C) a country or jurisdiction for which exports or transactions are subject to specific restrictions under any United States export or other law or United Nations Security Council Directive, including without limitation, the Trading With the Enemy Act, 50 U.S.C. App. Section 1 et seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et seq. and the Export Administration Act, 50 U.S.C. App. Section 2401 et seq.; (ii) the flights proposed by such party shall not cause (A) such other party's Aircraft or any part thereof (1) to be used predominately outside of the United States within the meaning of the Section 168(g)(1)(A) of the Internal Revenue Code of 1986, as amended (the "Code"), and (2) to fail to be operated to and from the United States within the meaning of Section 168(g)(4)(A) of the Code; or (B) any item of income, gain, deduction, loss or credit with respect to the transactions contemplated by this Agreement to be treated as derived from, or allocable to, sources without the United States within the meaning of Section 862 of the Code; or (C) such other party or such other party's Aircraft to become liable for any personal property, ad valorem, rental, sales, use, excise, value-added, leasing, leasing use, stamp, or other similar tax, levy, impost, duty, charge, fee or withholding; (iii) the proposed flights do not require the flight crew to exceed any flight or duty time limitations that such other party imposes upon its flight crews; and (iv) in the judgment of the such other party, the safety of flight is not jeopardized.
(e) Each party acknowledges that, if, in the opinion of the other party (including, its pilot-in-command), flight safety may be jeopardized, such other party may terminate a flight or refuse to commence it without liability for loss, injury or damage occasioned by such termination or refusal. Each party acknowledges that the other party
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shall not be liable for any loss, damage, cost or expense arising from or related to, directly or indirectly, any delay, cancellation or failure to furnish any transportation pursuant to this Agreement, including, without limitation, when caused by government regulation, law or authority, mechanical difficulty or breakdown, war, civil commotion, strikes or other labor disputes, weather conditions, acts of God, public enemies or any other cause beyond such other party's control.
(f) LVSC acknowledges that (i) Interface's Aircraft is owned by Yona Aviation Corp. ("Yona Aviation") and is leased to Interface (the "G-III Lease"), and (ii) LVSC's rights in and to Interface's Aircraft under this Agreement are subject and subordinate to all terms of the G-III Lease and all rights of Yona Aviation in and to the Aircraft and under the G-III Lease, including, without limitation, the right of Yona Aviation to inspect and take possession of the Aircraft from time to time in accordance with the GIII-Lease and applicable law. LVSC acknowledges that Yona Aviation has not made any warranty or representation, either express or implied, as to the design, compliance with specifications, operation, or condition of, or as to the quality of the material, aircraft, or workmanship in, Interface's Aircraft or any component thereof delivered to Interface, and Yona Aviation does not make any warranty of merchantability or fitness of Interface's Aircraft or any component thereof for any particular purpose, or any other representation or warranty, express or implied, with respect to Interface's Aircraft or component thereof.
6. Pilots. For all flights pursuant to this Agreement, each party shall cause its Aircraft to be operated by pilots who are duly qualified under the Federal Aviation Regulations, including without limitation, with respect to currency and type-rating, who meet all other requirements established and specified by the insurance policies required hereunder.
7. Operation and Maintenance Responsibilities. Each party shall be in operational control of its Aircraft for all flights on such Aircraft by the other party pursuant to this Agreement. As between the parties, each party shall be solely responsible for the operation and maintenance of its Aircraft.
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8. |
Flight Specific Expenses. |
(a) The differential cost of operating the Aircraft shall include the differential amount of costs specifically incurred with respect to each flight (including ferry or positioning flights) that are not directly associated with operating the Aircraft, including:
(i) all fees, including fees for landing, parking, hangar, tie-down, handling, customs, use of airways and permission for overflight;
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(ii) |
all expenses for flight planning and weather contract services; |
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(iii) |
all expenses for catering and in-flight entertainment materials; |
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(iv) all travel expenses for pilots, flight attendants and other flight support personnel, including food, lodging and ground transportation;
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(v) |
all communications charges, including in-flight telephone. |
Costs specifically incurred for a flight are not intended to include costs ordinarily incurred with respect to the operation of the Aircraft such as: hangaring at the Home Base, insurance, crew training, crew salaries and benefits, maintenance, fuel and oil. Each party shall be responsible for arranging and paying for all passenger ground transportation and accommodation in connection with such party's use of the other party's Aircraft.
(b) Each party shall deliver to the other party an itemized statement of all costs described in section 8(a) and Exhibit A incurred in the previous month with respect to flights by the other party. If the amount of such costs incurred by LVSC exceeds the amount of such costs incurred by Interface, then Interface shall pay LVSC such excess no later than 30 days after receiving LVSC's statement of such costs. If the amount of such costs incurred by Interface exceeds the amount of such costs incurred by LVSC, then LVSC shall pay Interface such excess no later than 30 days after receiving Interface's statement. Each party shall, on request of the other party, provide documentation to support the amount of costs reflected on such party's statements.
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9. |
Taxes. |
(a) Except for any taxes on, or measured by, the net income of a party imposed by the United States Government or any state or local government or taxing authority in the United States, which shall be the sole responsibility of such party, the other party shall pay to and indemnify such party and its employees and agents (collectively, the "Indemnitees") for, and hold each Indemnitee harmless from and against, on an after-tax basis, all other income, franchise, gross receipts, rental, sales, use, excise, personal property, ad valorem, value added, leasing, leasing use, stamp, landing, airport use, or other taxes, levies, imposts, duties, charges, fees or withholdings of any nature, together with any penalties, fines, or interest thereon ("Taxes") arising out of such party's use of such other party's Aircraft and imposed against any Indemnitee, lessee, or the Aircraft, or any part thereof, by any federal or foreign government, any state, municipal or local subdivision, any agency or instrumentality thereof or other taxing authority upon or with respect to the Aircraft, or any part thereof, or upon the ownership, delivery, leasing, possession, use, operation, return, transfer or release thereof, or upon the rentals, receipts or earnings arising therefrom, or upon or with respect to this Agreement. The indemnifying party shall have the right to contest any Taxes, provided that (a) the indemnifying party shall have given to such other party written notice of any such Taxes, which notice shall state that such Taxes are being contested by the indemnifying party in good faith with due diligence and by appropriate proceedings and that the indemnifying party has agreed to indemnify each Indemnitee against any cost, expense, liability or loss (including, without limitation, reasonable attorneys' fees) arising from or in connection with such contest; (b) in such other party's sole judgment, such other party has received adequate assurances of payment of such contested Taxes; and (c) counsel for such other party shall have determined that the nonpayment of any such Taxes or the contest of any such payment in such proceedings does not, in the sole opinion of such counsel, adversely affect the title, property or rights of such other party. In case any report or return is required to be made with respect to any Taxes, the indemnifying party will either (after notice to the other party) make such report or return in such manner as will show that such party owns, leases or otherwise has exclusive possession
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and control of the Aircraft and send a copy of such report or return to such other party or will notify such other party of such requirement and make such report or return in such manner as shall be satisfactory to such other party. Such other party agrees to cooperate fully with the indemnifying party in the preparation of any such report or return.
(b) Without limiting the generality of section 9(a), a party using the other party's Aircraft pursuant to this Agreement shall pay to such other party any federal excise taxes applicable with respect to such party's use, or such party's payment for such party's use, of such other party's Aircraft.
10. Insurance. Each party shall be responsible for all costs to maintain in effect, throughout the Term, insurance policies with respect to its Aircraft providing public liability, property and environmental damage coverage with a combined per occurrence limit of liability of no less than Three Hundred Million Dollars ($300,000,000) and medical expense coverage with a per person limit of liability of no less than Ten Thousand Dollars ($10,000) and providing such other coverages as such party deems appropriate. All insurance policies shall (a) name the other party as an additional insured with respect to such other party's use of such party's Aircraft, (b) not be subject to any offset by any other insurance carried by either party with respect to such other party's use of such party's Aircraft (except for any non-owned insurance coverage that a party may carry that is underwritten by the underwriter(s) of the other party's insurance policies), (c) contain a waiver by the insurer of any subrogation rights against such other party with respect to such other party's use of such party's Aircraft, (d) insure the interest of such other party, regardless of any breach or violation by the party holding the policy or of any other person (other than is solely attributable to the gross negligence or willful misconduct of such other party) of any warranty, declaration or condition contained in such policies, (e) provide that any cancellation or any reduction in the coverage shall not be effective as to such other party until 30 days (or, with respect to war risk insurance, 7 days or such shorter period as may then be customary on the London market, and with respect to cancellation on account of non-payment of premium, 10 days) after receipt by such other party of written notice from the insurer of such cancellation or reduction in coverage, and (f) include a severability of interests endorsement providing that such policy shall operate in the same manner (except for the limits of coverage) as if there were a separate policy covering each insured.
Each party shall submit a copy of this Agreement to the issuer(s) of the insurance policies such party maintains in accordance with this section 10 and shall cause such issuer(s) to provide to the other party a certificate of insurance evidencing compliance with the requirements of this section 10.






