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03/10/1964 Lease THIS INDENTURE OF LEASE, made and entered into by and between MONROE COUNTY, FLORIDA {hereinafter referred to as "LESSOR "}, and SOUTH CENTRAL AIRLINES, INC., a Florida corporation (hereinafter re- ferred to as "LESSEE"), WITNESSETH WHEREAS, Lessor owns an airport known as Key West International Airport, located in Monroe County, State of Florida {hereinafter called the "AIRPORT "}, and WHEREAS, Lessee is engaged in the business of transportation with respect to persons, property, cargo and mail at the Airport, and WHEREAS, Lessee desires to lease certain premises,' facilities and rights in connection with and on the Airport and Lessor is willing to lease same to Lessee upon the terms and conditions hereinafter stated, NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants and agreements herein contained, and other valuable considerations, Lessor does hereby demise and let unto Lessee and Lessee does hereby hire and take from Lessor certain premises, facilities and rights in connection with and on the Airport as follows, to-wit: ARTICLE I - TERM: The term of this lease shall be for a period of one year, commencing on the 1st day of and ending on the 28th day of February March , A. D. 1964 , A. D. 196 5 ARTICLE II - RENTAL: Lessee agrees to pay Lessor for the use of the Airport, all premises, facilities and rights granted hereunder for demes- tic operations only, except as hereinafter set forth, an annual rental of $3, 000. 00, payable in equal monthly amounts of $250.00 each, such payments to be made within ten days of receipt of Lessorfs billing therefor; but not earlier than the first day of each month for which the rent is applicable. The above payments are based upon the Lesseefs use of facilities assigned to it in the Airport Terminal Building, and the privilege of operating three (3) flights per day. In the event Lessee operates more than three flights per day, Lessee shall then pay to the Lessor an additional sum of $2.50 per flight over and above the three (3) flights per day, such payments to be in addition to the monthly payments contemplated hereunder. ARTICLE III - EXCLUSIVE SPACE IN ADMINISTRATION BUILDING: The exclusive use of the space referred to under Article II herein for such uses as the Lessee may desire to make thereof in connection with or inciden- tal to its operation of a domestic air transportation system, including spe- cifically but not by way of limitation the use of said space for ticket counter area, operations room and cargo storage area. ARTICLE IV - GENERAL U.SE OF AIRPORT, LEASED PREMISES AND FACILITIE.S: As duly authorized by competent Governmental authority, Lessee shall have the right to operate a domestic transportation system, at the Airport, by aircraft, for the carriage of persons, property, cargo and mail, which right shall include the following: (I) The right to use, in common with other domestic operators authorized to do so, the common areas of the Airport and appurtenances there- to, which have been designated by Lessor for common use, including, but not limited to, landing areas, aprons, taxiways, roadways, flood lights, ramp lighting, beacons, signals, radio aids, sewerage, control tower, fire and crash equipment and other conveniences for flying, landing, and take-offs of aircraft of Lessee. (2) The right to land, take-off, fly, taxi, tow on the ground, load and unload aircraft and equipment used by Lessee in its operation of a domestic air transportation system on the Airport. f3} The right to make repairs, test, maintain, condition, service with fuel, oil, greases or other supplies, park or store aircraft or other equipment of Lessee or, with prior permission of Lessor, of any other scheduled domes- tic air transportation company, on premises leased to Lessee or on premises leased to such other scheduled domestic air transportation companies. (4) The right to train personnel in the employ of, or to be employed by, the Lessee. -2- (5) The right to install, maintain and operate, at lessee's expense, by Lessee alone or in conjunction with any other air transportation companies who are lessees at the Airport, or through a nominee, radio, telephone, tele- type and other communications equipment, meteorological and aerial navi- gation equipment and facilities in or on premises leased exclusively to Les- see, subjec t to the approval of Lessor so as to enable Lessor to prevent in- terference with the reasonable use of the Airport by other authorized persons, such approval not to be unreasonably withheld. (6) The right to buy, sell, exchange or otherwise dispose of Lesseers aircraft, engines, accessories, gasoline, oil, greases, lubricants, fuel, food and other equipment or supplies, including any article or goods used by or bought for use by Lessee in connection with its conduct of domestic air transportation, provided that such right shall not be construed as authorizing the conduct of a separate business by Lessee, but shall permit Lessee to per- form such functions as are incident to its conduct of domestic air transporta- tion and further provided that Lessee shall not sell gasoline, fuel, propellants, greases and other lubricants, except to a subsidiary or affiliated company, un- less authorized so to do by Lessor. (7) The right to install, maintain and operate, or cause to be installed, maintained or operated, without cost to Lessor, in a hangar or any other buildings exclusively leased to the Lessee, a cafeteria, restaurant or other plant for the purpose of preparing, cooking and dispensing of foods and bev- erages for consumption on Lessee's aircraft, or for Lessee's employees, but shall not include the right to maintain or operate a public cafeteria or restau- rant for the purpose of selling food or beverages to the public. Any space ex- clusively leased to the Lessee hereunder shall require an additional rental to be paid other than the rental set forth in "Article II - Rental" herein, to be agreed upon by the Lessee and Lessor when said additional space is necessary. Neither shall said right be considered to authorize the installation and operation of auto- matic vending machines of any nature at any place on the Airport. -3- (8) The right to install, maintain and operate, without cost to Lessor, by Lessee alone, or in conjunction with any other air transportation compan- ies who are lessees at the Airport, or through a nominee, a message tube system and other communication systems between suitable locations in the aircraft loading areas and suitable locations in or about Lessee's hangars and between any or all of the said locations and Lessee's offices, the locations to be subject to the approval of Lessor, in so far as the interests of safety and convenience of all are concerned, which approval shall not be unreasonably withheld. (9) The right, directly, or through a contractor of Lessee es choice, to transport Lessee's cargo, property and mail to, from and at the Airport by such vehicles as Lessee or Lessee's contractor may desire or require. This operation of such vehicles shall be subject to the reasonable regulations of the Airport relative to the use of ground vehicles on Airport property. (IO) The right to install and operate on the interior of the premises ex- clusively leased, at Lessee's expense, advertising signs representing its busi- ness, which signs shall be substantially uniform in size, type and location with those of other air transportation companies leasing space on the premises. The number, size, type, design and location of all such signs shall be subject, however, to the prior written approval of the Lessor. (11) Consolidation of Ground Services: The rights and privileges granted the Lessee herein, with respect to the performance of ground services and ac- tivities in connection with its air transportation operation at the Airport, may be exercised by Lessee for and on behalf of any other domestic air transporta- tion company or companies authorized by Lessor to use the Airport. Without limitation, such rights and privileges shall be deemed to include all activities incidental to the handling of reservations, the ticketing of passengers, the re- ceipt, dispatch, loading, unloading and storage of passengers and their baggage, property, cargo and mail, and all ramp, repair, maintenance, storage, fueling and dispatching services incidental to the operations of aircraft at the Airport. -4- The foregoing shall not be construed to authorize such other company or com- panies to use the Airport without the payments of fees and charges established by Lessor. (I2) The right to purchase, on or off said ,Airport, of Lesseets re- quirements of gasoline, fuel, lubricating oil, grease, food and other passen- ger supplies, and any other materials and supplies, from any person or com- pany of Lesseets choice, and the right to make agreements with any person or company of Lessee I s choice for work to be done for Lessee. (13) The right to service, by Lessee, its suppliers or others, on leased premises, and upon the apron of the Terminal Building, Lesseets air- craft and other equipment, by truck or otherwise, subject to regulations of Lessor, concerning only the orderly operation of the Airport, with gasoline, oil, grease, and any other fuel, food or supplies to be used by Lessee; such right shall include, without limiting the generalities thereof, the right to erect, install and maintain on said Airport, on leased premises, in accordance with insurance underwriterst standards, adequate underground storage facilities for such gasoline, oil and other inflammable fuel or supplies, together with necessary pipes, pumps, motors, filters and other appurtenances, at con- venient locations, upon the payment of an additional rental other than the ren- tal set forth in "Article II - Rental" herein, to be agreed upon by the Lessee and Lessor, such storage locations to be subject to prior written approval of Lessor when said additional space is necessary, such approval not to be un- reasonably withheld. (I4) Parking Space: The use by Lessee and its employees in common only with the other air transport operators who may be lessees of space at the Airport and their employees, of adequate vehicular parking space located as near as possible to said Administration Building, without charge to Lessee or to said employees. (IS) Right of Ingress and Egress: The right of ingress to and egress from premises and facilities of the Airport herein leased, without charge to Lessee, its employees, agents, passengers, invitees, and suppliers of materials and furnishers of service. -5- (16) Maintenance and Operation of Airport: Lessor agrees that it will, at all times, maintain and operate and keep clean with adequate and efficient personnel, and keep in good repair, said Airport and the appurten- ances, facilities and services connected therewith, and keep said Airport and its approaches free from obstruction, congestion and interference for the safe, convenient and proper use thereof by Lessee and will maintain and operate said Airport so as to entitle it to the approved rating by the Federal A viation Agency and all other appropriate regulatory authorities. (17) Building by Lessee: Lessee, at its own cost and expense, may construct and install, in accordance with applicable laws and ordinances, in or on any space which is exclusively leased to Lessee, any buildings, struc- tures or improvements, including equipment and underground storage tanks necessary for use in connection with its domestic air transportation operations, the locations to be subject to prior written approval by Lessor, such approval not to be unreasonably withheld. Lessee may at its own cost and expense al- ter, modify, repair and maintain any buildings, structures or improvements constructed or installed on premises leased hereunder, plans for which are to be subject to prior written approval of Lessor, such approval not to be unrea- sonably withheld. Any space exclusively leased to the Lessee hereunder shall require an additional rental to be paid by the Lessee to the Lessor other than the rental set forth in l1Article II - Rentall1 hereunder, to be agreed upon by the Lessee and Lessor when said additional space is necessary. Any building so constructed on the leased premises by the Lessee shall at the termination of this lease revert to the Lessor. (18) Use of Public Address System: Lessee shall have the privilege of using the Airport public address system and operating a sufficient number of microphones and units to properly conduct their busines s in the area in the Terminal Building leased hereunder, without further charge. Lessee shall have the use of such units presently installed in the leased space. However, additional units used by Lessee may be procured and installed at Lesseels ex- pense and any expense involved in relocation of any units will be borne by Lessee. -6 - (19) Alterations and Improvements: Lessee is not authorized to make any alterations or improvements to the herein leased premises without prior written approval of Lessorl such approval not to be unreasonably withheld. ARTICLE V - USE OF TERMINAL BUILDING: The use of space in the Terminal Building leased hereby shall be for purposes incidental to the operation of Lessee's domestic air transportation business and will be in accordance with the following conditions: (I) General: It is expressly understood that Lessor will keep the public space in the Terminal Building attractively furnishedl and will provide and supply adequate lightl electricity and water for the public space; janitors and other cleaners necessary to keep the public space in the Terminal Building at all times clean, neat, orderly, sanitary and presentable. (2) Electricity: Lessee agrees to pay Lessor for all electricity used by it in the space leased and solely occupied by it hereunder. Such electricity will be separately metered. (3) Janitor and Cleaning Services: Lessee shall, at its own expense, provide janitor and cleaning services within the exclusive space leased and occupied hereunder, and shall keep the space in a clean and sanitary condition at all times. Lessor agrees to provide adequate rubbish containers into which Lessee may, with its own personnel, dump rubbish which may accumulate in Lessee's normal use of the Terminal Building. (4) The operations of Lessee shall be conducted in an orderly and pro- per manner and so as not to annoy, disturb or be offensive to others at the Airport. (5) It shall be Lessor1s responsibility to maintain and replace all glass bordering both on the field side of the leased space and on the public corridor of leased space, except in instances where damage to such glas s should occur through the acts of Lessee, its agent, suppliers, passengers, or others doing business with it at the Airport, in which event Lessee will assume such re- sponsibility. -7- (6) The personal property placed or installed by Lessee in the exclusive- ly leased area shall remain the property of Lessee and must be removed on or before the expiration of the term hereby granted. In the event of expiration or other termination, Lessee shall have 10 days, exclusive of Saturdays, Sun- days or holidays, after such termination, in which to remove its property. (7) If Lessee shall fail to remove its property upon the expiration or termination hereof, Lessor may, at its option, after expiration of period of grace granted by the preceding paragraph hereof, as agent for Lessee and at Lessee IS expense and risk, remove such property to a public warehouse for deposit, or retain the same in its own possession, and after the expiration of 30 days therefrom, sell the same at public auction, the proceeds of which shall be applied first to the expenses of sale, second to any sums owed by Lessee to Lessor, and any balance remaining shall be paid Lessee, or may take such other action as may be necessary or desirable. (8) Unless otherwise expressly provided or agreed, Lessee shall not use the leased space (or permit it to be used) for the sale to its employees or to any other person, of any beverages, food, candy, gum, ice cream or ice cream products, tobacco or tobacco products, periodicals, books, drugs, toys, garnes, souvenirs, jewelry, novelties, clothing, flowers, sporting goods, pho- tographic goods, or toilet articles, or for the furnishing, for a consideration, of theatre tickets, shoe shines, pressing and cleaning (except of its employeest uniforms), developing and printing of photographs and films, ground baggage checking services or for the display of the advertising of third parties, except in cases in which Lessee handles ground services for another air transportation company, pursuant to paragraph (11) of ARTICLE IV, or for the installation of any coin-operated machines or devices, or for any other purpose beyond those herein expressly authorized. (9-) The Lessor, or its authorized representative, shall have the right at any time and as often as it considers necessary, upon request to Lessee, to inspect the space and-Jwithout obligation to do so) to enter thereon to make or- dinary repairs and, in the event of an emergency, to take such action therein -8- as may be required for the protection of persons or property or otherwise to execute the terms and conditions of this lease. (10) The Lessee shall, at its expense, repair or replace, as may be required, all electical incandescent bulbs or flourescent tubes or other lighting devices located within the space leased hereunder. (11) Improvements: During the term of this lease, neither Lessor nor Lessee is obligated by this lease to make any repairs, replacements, improvements, alterations or additions of any nature, other than those spe- cifically agreed upon in this lease, except that Lessor shall make such struc- tural repairs as may be required to keep the leased space usable for the pur- poses leased. ARTICLE VI - INSURANCE AND INDEMNITY: Lessee shall maintain public liability, Airport liability, aircraft liability, fire and property damage insurance, and shall carry Workmen fS Compensation and employers f liability insurance as required by law. Lessee shall indemnify and hold harmless Lessor from any and all demands, losses, liabilities or judgments, together with costs and expenses incident thereto, which may accrue against, be charged to, or be recoverable from Lessor as a result of the negligent acts or omis- sions of Lessee, its employees or agents in connection with Lesseefs use and occupancy of the demised premises, excluding, however, such as may be occasioned by the negligence of Lessor, its employees or agents. Lessor shall give to Lessee prompt and timely notice of any claim made or suit insti- tuted, which in any way, directly or indirectly, contingently or otherwise, affect or might affect, Lessee and Lessee shall have the right to compromise or participate in the defense of the same to the extent of its own interests. ARTICLE VII - QUIET ENJOYMENT: Lessor agrees that, on payment of the rentals, fees and charges herein provided for, and performance of the covenants and agreements on the part of Lessee to be performed hereunder, Lessee shall peaceably have and enjoy the leased premises, rights and facili- ties herein granted. -9- ARTICLE VIII - CANCELLATION BY LESSOR: In the event Lessee shall file a voluntary petition in bankruptcy or proceedings in bankruptcy shall be instituted against it and Lessee is thereafter adjudicated bankrupt, pursuant to such proceedings, or that the court take jurisdiction of Lessee and its assets, pursuant to proceedings brought under the provisions of any Federal reorganization act, or that a receiver of Lessee's assets shall be appointed, or that Lessee shall be prevented by any final action of any Fed- eral or State authority from conducting and operating its transportation sys- tern for the carriage of persons, property and mail by aircraft at the Airport, or that Lessee shall fail to perform, keep and observe any of the terms, cove- nants or conditions herein contained on the part of Lessee to be performed, kept or observed, Lessor may give Lessee notice in writing to correct such condition or cure such default, and, if any such condition or default shall con- tinue for 30 days after the receipt of such notice by Lessee, the Lessor may, after the lapse of said 30 days period and prior to the correction or curing of such condition or default, terminate this lease by a 20 days written notice and the term hereby demised shall thereupon cease and expire at the end of such 20 days in the same manner and to the same effect as if it were the ex- piration of the original term. ARTICLE IX - CANCELLATION BY LESSEE: Lessee, in addition to any right of cancellation or any other right herein given to Lessee, may can- cel this lease in its entirety and terminate all or any of its obligations here- under at any time by 30 days written notice upon or after the happening of any one of the following events: A. Any failure or refusal by the Federal Aviation Agency to permit Lessee to operate into, from or through said Airport with the type of equip- ment which Lessee happens to own at any time. B. The breach by Lessor of any of the covenants or agreements here- in contained and the failure of Lessor to remedy such breach for a period of 30 days after receipt of written notice of the existence of such breach. -10- C. The inability of Lessee to use said premises and facilities con- tinuing for a longer period than 30 days due to any law or order, rule or regulation of any appropriate governmental authority having jurisdiction over the premises or the operations of Lessee, except that, upon the in- ability of Lessee to use the Airport and leased premises because of war, earthquake, or other casualty, Lessee may suspend this lease during such inability. During the period of any such suspension the Lessor retains the right to utilize the leased premises as it deems advisable. The inability of the Lessee to use said premises and facilities due to strikes of its em- ployees shall not be considered grounds for the Les see to terminate or cancel this lease. D. The termination of Lesseefs obligations or right to carry passengers and/ or United States Air Mail to, from or through Key West, Florida. ARTICLE X - ASSIGNMENT AND SUBLETTING: Lessee shall not, at any time, unless provided for elsewhere in this lease, assign this lease or any part thereof, nor shall Lessee sublet the premises nor any part thereof herein leased to Lessee, without the prior written consent of Lessor, except that, without such consent, Lessee may as sign this lease to any corporation with which Lessee is affiliated, may merge, consolidate, or which may suc- ceed to the business of Lessee. ARTICLE XI - SUCCESSORS AND ASSIGNS BOUND BY THIS AGREE- MENT: All the covenants and agreements in this lease shall extend to and bind the legal representatives, successors and assigns of the respective par- ties hereto. ARTICLE Xli - DAMAGE OR DESTRUCTION OF PREMISES: If any building of Lessor in which Lessee occupies exclusive space hereunder shall be partially damaged by fire, the elements, the public enemy or other casual- ty but not rendered untenantable, the same shall be repaired with due diligence by Lessor at its own cost and expense. If the damage shall be so extensive as to render such building untenantable but capable of being repaired in 30 days, the same shall be repaired with due diligence by Lessor at its own cost and -11- expense and the rent payable hereunder, with respect to Lessee's exclusive space in such building, shall be proportionately paid up to the time of such damage and shall thenceforth cease until such time as such building shall be fully restored. In case any such building is completely destroyed by fire, the elements, the public enemy or other casualty, or so damaged that it will or does remain untenantable for more than 30 days, at the option of Lessee, either: (1) said building shall be repaired or reconstructed with due diligence by Lessor at its own cost and expense, and the rent payable hereunder with respect to Lessee's exclusive space in said building shall be proportionately paid up to the time of such damage or destruction and shall thenceforth cease until such time as said building shall be fully restored; or (2) if within 12 months after the time of such damage or destruction, said building shall not have been repaired or reconstructed for Lessee's use, Lessee may give Lessor written notice of its intention to then cancel this lease in its entirety or to cancel as of the date of such damage or destruction, such part of this lease as relates only to said building. In the event that the Airport, or any other premises herein leased, shall be rendered urtenantable or unusable because of the condition thereof, there shall be a reasonable and proportionate abatement of the rentals, fees and charges provided for herein during the period that the same are so un- tenantable or unusable. ARTICLE XIII - NOTICES: A bill or statement may be rendered or any notice or communication which Lessor may desire to give Lessee shall be deemed sufficiently rendered or given if the same be in writing and sent by registered or certified mail, addressed to Lessee at the Jim Taylor Air- port, Ocala, Florida, or at the address Lessee may substitute therefor by notice to Lessor, or left at such address, and the time of rendition of such bill or statement and the giving of such notice or communication shall be deemed to be the time when the same is mailed, left or delivered as herein provided. Any notice from Lessee to Lessor shall be validly given if sent by registered or certified mail, addressed to the Board of County Commissioners, -12 - Monroe County Court House, Key West, Florida, or such other address as Lessor shall hereafter designate by notice to Lessee. ARTICLE XIV: In the event the Lessee and/or its legal representatives, successors and assigns, during the term of this lease engage in flying inter- national flights from and to the Airport, then and in that event the Lessee shall pay an additional rental other than the rental set forth in "Article II - Rental" herein, to be agreed upon by the Lessee and Lessor, which said rental will be for the additional use of the Airport and additional services furnished by the Lessor. ARTICLE XV: The Lessee shall have the right to renew this lease for an additional term of 1 year, at rentals to be mutually agreed upon at the time of such renewal between Lessor and Lessee. IN WITNESS WHEREOF, the parties have caused these presents to be executed as of the 10th day of March , A. D. 196.!L: Attest: /g~..,! U4?JA Clerk of the Circuit Court of Monroe County, Florida, and ex officio Clerk of the Board of County Commissioners of Monroe County, Florida. SOUTH CENTRAL AIRLINES, INC. By Attest: H. A. Emery - Seely. - Treas. -13-