Exhibit 10.4
THIRD AMENDMENT
TO
LEASE AGREEMENT
AAR AIRCRAFT SERVICES,
INC.
INDIANAPOLIS AIRPORT
AUTHORITY
THIS THIRD AMENDMENT made and entered into the
16th day of May, 2008 by and between the Indianapolis Airport
Authority, (hereinafter referred to as Authority) and AAR Aircraft
Services, Inc. (hereinafter referred to as Tenant),
W I T N E S S E T H:
WHEREAS, Authority and Tenant
entered into a Lease Agreement dated June 17, 2004, providing
for Tenant’s occupancy of a portion of the Indianapolis
Maintenance Center as the Leased Premises; and
WHEREAS, Authority and Tenant
entered into Amendment No. 1 dated January 21, 2005
amending the Leased Premises described in Exhibit B, revised
the terms of Article XII, Financial Security and revised
Exhibit K, Operating Rules; and
WHEREAS, Authority and Tenant
entered into Amendment No. 2 dated May 19, 2006 amending
the Leased Premises described in Exhibit B, revised Activation
Notice language in Article II, revised rental language in
Article VI, addition of language in Article II and
Article VI for the activation of On-Call Bays, and addition of
language in Article VI for training grant aid including an
update to Exhibit G and the addition of Exhibit L;
and
WHEREAS, Tenant desires to modify
Bay 5B so as the Bay can be utilized to paint Tenant’s
customers aircraft; and
WHEREAS, Authority and Tenant find
it necessary to update use of premises, environmental, expiration
and maintenance/services language due to Tenants desire to modify
Bay 5B to paint Tenant’s customers aircraft;
NOW THEREFORE, in consideration of
the mutual covenants and considerations contained herein, the
parties agree that Article II, Lease of Leased Premises;
Ownership of Improvements and Equipment; Use of Premises,
Section 206. Use of Leased Premises; Prohibited Uses
(A), Article V, Term; Extension Periods, Section 503.
Rights at Expiration/Termination , Article X,
Maintenance, Repairs and Replacements, Section 1001.
Maintenance, Repairs and Replacements to Facilities and Leased
Premises (other than Equipment) and Section 1002.
Maintenance Repairs and Replacements of and to Equipment ,
Article XI, Facilities Operations and Services,
Section 1101. Services and Section 1103.
Utilities to be Obtained and Maintained by Tenant , and
Exhibit K, Operating Rules are hereby deleted and the
following are substituted:
ARTICLE
II
LEASE OF LEASED PREMISES;
OWNERSHIP OF IMPROVEMENTS
AND EQUIPMENT; USE OF LEASED PREMISES
Section 206.
Use of Leased Premises; Prohibited Uses .
(A)
Tenant may only use the Leased Premises for operation of an
aircraft, airframe, engine and component maintenance, repair and
overhaul (“MRO”) facility for the commercial airlines
and other owners, operators or service/maintenance providers of
aircraft (including without limitation military and governmental
operators of aircraft), including the operation and use of aircraft
bays, aircraft engine and component overhaul and repair shops, test
cells, aircraft wash and enclosed paint areas, including Bay 5B for
aircraft painting, component, part and tooling production,
reproduction, or construction (i.e., make from raw materials or
piece parts) for MRO, component maintenance, and modification
activities. In addition, Tenant may use the Leased Premises
for activities functionally related and subordinate to the uses
permitted above, including warehouse and storage areas, common
areas, facilities maintenance shops, administrative and support
areas, truck docks and aprons, special materials storage areas,
aircraft taxiways and parking areas, fire protection facilities and
employee and visitor parking so long as such activities are of a
size commensurate with such operation.
ARTICLE
V
TERM; EXTENSION
PERIODS
Section 503.
Rights at Expiration/Termination .
(A)
In no event shall Tenant or any of its subtenants continue to
possess, occupy or use the Leased Premises beyond the expiration or
sooner termination of the Term without the Authority’s
written consent, which consent may be withheld in the
Authority’s sole and absolute discretion.
(B)
Tenant further agrees that upon the expiration or earlier
termination of the Term, the Leased Premises shall be delivered to
the Authority in at least as good condition as originally delivered
to Tenant, (provided that Hangar 5B may be returned in the
condition as modified by Tenant for aircraft painting), reasonable
wear and tear and matters covered by insurance excepted, and
subject to performance by the Authority of the Authority’s
maintenance, repair and replacement obligations under this Lease,
including but not limited to its maintenance, repair and
replacement obligations pursuant to Sections 1001 and 1002 below,
and the Authority’s obligations under Article VII and
Section 1702 of this Lease.
2
ARTICLE
X
MAINTENANCE, REPAIRS AND
REPLACEMENTS
Section 1001.
Maintenance, Repairs and Replacements to Facilities and Leased
Premises (other than Equipment) . Except to the extent
Tenant is responsible therefor under this Section 1001, and
subject to Article XVI of this Lease and subject to the
Authority’s obligations under Articles VII and XVII of this
Lease, the Authority shall, at its cost and expense, be responsible
during the Term for (a) performing all maintenance, repairs
and replacements with respect to the Facilities and the Leased
Premises (other than Equipment, which is covered under
Section 1002 below), including without limitation foundations,
exterior Facility walls (including door frames, window frames,
doors and windows), exteriors of the Facilities, interior demising
walls (including door frames and window frames), roof, drains,
gutters, and all structural parts of the Facilities,
(b) periodically painting the interior walls, and sealing the
concrete floors, within the Leased Premises in order to maintain
them in a reasonably neat, safe condition, and (c) performing
all maintenance, repairs and replacements with respect to the air
conditioning, electrical, heating, mechanical and plumbing systems
in the Facilities, all in at least as good condition as exists on
the Effective Date of this Lease Agreement or in such condition as
may be required by applicable Law. However, the Authority
shall not be required to pay for, and Tenant shall indemnify,
defend, save and hold harmless the Authority from and against
(without reimbursement from Grant Proceeds or Leasehold Improvement
Credits), the cost and expense (including without limitation
reasonable attorneys’ fees) of, any such maintenance, repairs
or replacements that become necessary as a result of or by reason
of Tenant’s, its subtenants’ or its or their respective
agent’s, contractor’s, Employee’s, or
Invitee’s negligence or willful misconduct.
Furthermore, provided that the Authority delivered the Paint Booths
to Tenant in good working order and condition and in compliance
with all Laws, Tenant shall, at its cost and expense, be
responsible for all maintenance and repairs (but not replacements,
except to the extent described in the proviso to this sentence) of
any paint booths now or hereafter located at the Leased Premises
(the “Paint Booths”), and shall perform such
maintenance and repairs (but not replacements, except as described
in the proviso to this sentence) as are necessary or appropriate in
order to cause the Paint Booths to remain in the same condition and
repair as when the Paint Booths were first delivered by the
Authority to Tenant (ordinary wear and tear excepted); provided,
however, that if the replacement of the Paint Booths becomes
necessary as a result of or by reason of Tenant’s, its
subtenants’, or its or their respective agent’s,
contractor’s, Employee’s, or Invitee’s negligence
or willful misconduct, Tenant shall be responsible, at its cost and
expense, for those replacements (without reimbursement from Grant
Proceeds or Leasehold Improvement Credits). Provided that the
Authority delivered the Paint Booths to Tenant in good working
order and condition and in compliance with all Laws, Tenant hereby
acknowledges and agrees that the Authority will have no liability,
obligation, or responsibility for maintaining, repairing or
replacing the Paint Booths or any components thereof. Tenant hereby
further acknowledges and agrees that if Tenant replaces the Paint
Booths and is reimbursed for the cost thereof through Grant
Proceeds or Leasehold Improvement Credits, the replacement Paint
Booths shall also be deemed to belong to the Authority.
Furthermore, as Tenant shall provide modifications to Bay 5B at its
sole cost and expense to support Tenant’s operation in the
painting of Tenant’s customers aircraft, Tenant shall, at its
sole cost and expense, be responsible for all maintenance, repairs
and replacements to any modifications to Bay 5B, which installation
is associated with Tenant transforming Bay 5B into a paint hangar
to paint Tenant’s customers aircraft. Tenant shall
perform such maintenance, repairs and replacements as are necessary
or
3
appropriate in order to
cause Bay 5B to remain in the same condition and repair as when Bay
5B was first delivered by the Authority to Tenant (ordinary wear
and tear excepted); provided, however, that if the replacement of
any of the modifications to Bay 5B becomes necessary as a result of
or by reason of Authority, its respective agent’s,
contractor’s, Employee’s, or Invitee’s negligence
or willful misconduct and Authority shall be responsible, at its
cost and expense, for those repairs or replacements. Provided that
the Authority delivered Bay 5B to Tenant in good working order and
condition and in compliance with all Laws, Tenant hereby
acknowledges and agrees that the Authority will have no liability,
obligation, or responsibility for maintaining, repairing or
replacing any components thereof associated with Tenant’s
modifications to Bay 5B related to transforming Bay 5B into an
aircraft painting operation. Tenant hereby further acknowledges and
agrees the proposed modifications to Bay 5B shall also be deemed to
belong to the Authority.
To the extent
that, during the Term of this Lease, it becomes necessary to
install and/or operate any air pollution control equipment at,
within or upon the Facilities as a result of Tenant’s or its
subtenants’ operations at the Facilities, and if such air
pollution control equipment is not a part of the Facilities on the
Effective Date of this Lease, Tenant shall be responsible, at
Tenant’s cost and expense, for purchasing, installing and
operating such equipment and the Authority shall have no
responsibility or liability therefor. Tenant shall obtain the
Authority’s prior written consent to Tenant’s
installation of any such equipment at the Facilities, which consent
shall not be unreasonably withheld. Any such equipment that is
installed at, within or upon the Facilities and which is a fixture
shall be deemed a part of the Facilities and shall belong to the
Authority unless the Authority otherwise agrees in writing that it
belongs to Tenant. Tenant may seek reimbursement for the cost and
expense it incurs in purchasing and installing such equipment at
the Facilities through Grant Proceeds (if any Grant Proceeds are
then available) or Leasehold Improvement Credits, subject to the
terms and conditions of Section 605(A) and
(C) above.
Tenant’s
obligations under this Section shall survive the expiration or
sooner termination of the Term of this Lease.
Section 1002.
Maintenance Repairs and Replacements of and to Equipment
.
(A)
Repairs, Replacements and Maintenance by the Authority
. Except to the extent Tenant is responsible therefor as
provided under this Section 1002, the Authority shall, at its
cost and expense, be responsible during the Term of this Lease
Agreement for performing all maintenance, repairs, and replacements
with respect to the Equipment furnished by the Authority to Tenant
(whether that Equipment is furnished pursuant to an Activation or
as replacement Equipment) including without limitation preventive
maintenance upon a periodic schedule in accordance with
manufacturers’ recommendations. The Authority’s
maintenance, repair and replacements obligations shall also extend
to any Equipment for which Tenant receives reimbursement from the
Authority through Grants or Leasehold Improvement Credits. To
the extent that it becomes necessary to replace any item of
Equipment, the Authority shall only be obligated to replace it from
then Available Equipment on the Master List of Equipment; the
Authority shall in no circumstance be obligated to purchase a new
item of replacement equipment, tooling or other personal property.
As part of the Authority’s obligations hereunder, the
Authority will provid
|
