Exhibit 10.34
QWEST BUSINESS RESOURCES,
INC.
AIRCRAFT TIME SHARING
AGREEMENT
This Aircraft Time Sharing Agreement
(“Agreement”) by and between Qwest Business Resources,
Inc. (“Lessor”), a Colorado corporation whose address
is 1801 California Street, Denver, Colorado 80202 and Barry Allen
(“Lessee”), whose address is 256 Cook Street, Denver,
Colorado 80206 (collectively the “Parties”), is
effective February 14, 2006 and shall terminate on
December 31, 2008, unless terminated sooner by either party
pursuant to Article 1 below.
WHEREAS, Lessor is legal owner of an
aircraft (“Aircraft”), equipped with engines and
components as described in the Aircraft Subject to the Time Sharing
Agreement attached hereto and made a part hereof, as Exhibit
A;
WHEREAS, Lessor has the right of
possession of an aircraft (“Aircraft”), equipped with
engines and components as described in the Leased Aircraft Subject
to the Time Sharing Agreement attached hereto and made a part
hereof, as Exhibit B;
WHEREAS, Lessor has contracted for a
fully qualified flight crew to operate the Aircraft; and
WHEREAS, Lessor desires to provide
to Lessee, and Lessee desires to have the use of 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”);
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WHEREAS, this Agreement sets forth
the understanding of the Parties as to the terms under which Lessor
will provide Lessee with the use, on a periodic basis, of the
Aircraft as described in Exhibits A and B hereto, currently owned
or operated by Lessor.
WHEREAS, the use of the Aircraft
will at all times be pursuant to and in full compliance with the
requirements of Federal Aviation Regulations (“FAR”)
91.501(b)(6), 91.501(c)(1), and 91.501(d);
NOW, THEREFORE, in consideration of
the mutual covenants and agreements herein contained, the Parties
agree as follows:
1. Termination.
Either party may terminate this Agreement for
any reason upon written notice to the other, such termination to
become effective ten (10) days from the date of the notice;
provided that this Agreement may be terminated on such shorter
notice as may be required to comply with applicable laws,
regulations, the requirements of any financial institution with a
security or other interest in the Aircraft, insurance requirements
or in the event the insurance required hereunder is not in full
force and effect.
2. Use of Aircraft.
(a) Lessee may use the Aircraft from time to
time, with the permission and approval of Lessor’s Flight
Operations Department, for any and all purposes allowed by FAR
91.501(b)(6) at such times as the Lessor does not require the use
of the Aircraft for the business purposes of Lessor or an
affiliate. Lessee’s use
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shall include the use of the Aircraft by his
Spouse or related family member (including children or
grandchildren) (“Related Family”) if they accompany him
on the flight.
(b) Lessee represents, warrants and covenants to
Lessor that:
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1.
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Lessee will use
each Aircraft for and on his own account only and will not use any
Aircraft for the purposes of providing transportation of passengers
or cargo in air commerce for compensation or hire;
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2.
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Lessee shall
refrain from incurring any mechanics lien or other lien in
connection with inspection, preventative maintenance, maintenance
or storage of the Aircraft, whether permissible or impermissible
under this Agreement, and Lessee shall not attempt 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;
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3.
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During the term
of this Agreement, Lessee 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 time-sharing
Lessee;
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(c) Lessee shall provide Lessor’s Flight
Operations Department with notice of his desire to use the Aircraft
and proposed flight schedules as far in advance of any
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given flight as possible, and in any case, at
least forty-eight (48) 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:
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1.
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proposed
departure point;
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3.
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date and time
of flight;
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4.
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the number and
identity of anticipated passengers and relationship to the
Lessee;
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5.
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the nature and
extent of luggage and/or cargo to be carried;
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6.
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the date and
time of return flight, if any; and
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7.
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any other
information concerning the proposed flight that may be pertinent or
required by Lessor or Lessor’s flight crew.
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(c) Lessor shall notify Lessee as to whether or
not the requested use of the Aircraft can be accommodated and, if
not, the Parties shall discuss alternatives.
(d) Lessor’s prior planned utilization of
the Aircraft will take precedence over Lessee’s use.
Additionally, any maintenance and inspection of the Aircraft takes
precedence over scheduling of the Aircraft unless such maintenance
or inspection can be safely deferred in accordance with applicable
laws and regulations and within the sound discretion of the
Pilot-In-Command.
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(e) Lessor shall have sole and exclusive
authority over the scheduling of the Aircraft, including which
Aircraft is used for any particular flight.
(f) Lessor shall not be liable to Lessee or any
other person for loss, injury, or damage occasioned by the delay or
failure to furnish the Aircraft and crew pursuant to this Agreement
for any reason.
3. Time-Sharing Arrangement.
It is intended that this Agreement will meet the
requirements of a “Time Sharing Agreement” as that term
is defined in FAR Part 91.501(c)(1) whereby Lessor will lease its
Aircraft and flight crew to Lessee.
4. Cost of Use of Aircraft.
(a) In exchange for use of the
Aircraft, Lessee shall pay the direct operating costs of
the Aircraft permitted pursuant to FAR 91.501 for any flight
conducted under this Agreement or a lesser amount as mutually
agreed to by the Parties. Pursuant to FAR 91.501(d), those direct
operating costs shall be limited to the following expenses for each
use of the Aircraft:
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(1)
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Twice the cost
of fuel, oil, lubricants and other additives;
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(2)
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Travel expenses
of the crew, including food, lodging, and ground
transportation.
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(3)
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Hangar and
tie-down costs when the Aircraft is required by the Lessee to be
away from the Aircraft’s base of operation.
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(4)
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Insurance
obtained for the specific flight.
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(5)
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Landing fees,
airport taxes, and similar assessments.
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(6)
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Customs,
foreign permit, and similar fees directly related to the
flight.
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(7)
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In flight food
and beverages.
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(8)
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Passenger
ground transportation.
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(9)
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Flight planning
and weather contract services.
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(b)
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Lessor will
invoice, and Lessee will pay, for all appropriate
charges.
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(c)
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In addition to
the rental rate referenced in Section 4(a) above, Lessee shall
also be assessed the Federal Excise Taxes as imposed under
Section 4261 of the Internal Revenue Code, and any segment and
landing fees associated with such flight(s).
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5. Invoicing and Payment.
All payments to be made to Lessor by Lessee
hereunder shall be paid in the manner set forth in this Paragraph
5. Lessor will pay to suppliers, employees, contractors and
government entities all expenses related to the operations of the
Aircraft hereunder in the ordinary course. As to each flight
operated hereunder, Lessor shall provide to Lessee an invoice for
the charges specified in Paragraph 4 of this Agreement (plus
domestic or international air transportation Excise Taxes, as
applicable, imposed by the Internal Revenue Code and collected by
Lessor), such invoice to be issued within thirty (30) days
after the completion of each such flight. Lessee shall pay Lessor
the full amount of such invoice upon receipt of the invoice. In the
event Lessor has not received a supplier invoice for reimbursable
charges relating to such flight prior to such invoicing, Lessor
shall issue a supplemental invoice for such charges to Lessee
within thirty (30) days of the date of receipt of the supplier
invoice and Lessee shall pay such supplemental invoice
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amount upon receipt thereof. All such invoices
shall separately itemize the expenses in items (1) through
(9) of paragraph 4(a) for each flight included in that
invoice. Delinquent payments, defined as payments received more
than thirty (30) days after invoice, to Lessor by Lessee
hereunder shall bear interest at the rate of ten percent
(10%) per annum from the due date until the date of payment.
Lessee shall further pay all costs incurred by Lessor in collecting
any amounts due from Lessee pursuant to the provisions of this
Paragraph 5 after delinquency, including court costs and reasonably
attorneys’ fees.
6. Insurance and Limitation of
Liability.
Lessor represents that the flight operations for
the Aircraft as contemplated in this Agreement will be covered by
the Lessor’s aircraft all-risk physical damage insurance
(hull Coverage), aircraft bodily injury and property damage
liability insurance, passenger, pilot and crew voluntary settlement
insurance and statutory workers compensation and employer’s
liability insurance.
(a) Insurance.
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1.
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Lessor will
maintain or cause to be maintained in full force and effect
throughout the term of this Agreement aircraft liability insurance
in respect of the Aircraft in an amount at least equal to $100
million combined single limit for bodily injury to or death of
persons (including passengers) and property damage liability.
Lessor will retain all rights and benefits with respect to the
proceeds payable under policies of hull insuran
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