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2012-04-01 FBO Franchise AgreementBLAIR AIRPORT AUTHORITY FBO FRANCHISE AGREEMENT THIS AGREEMENT, made and entered into this 1" day of April, 2012, by and between the Airport Authority of the City of Blair, a municipal corporation organized and existing under the laws of the State of Nebraska, (`GLAIR AIRPORT AUTHORITY"), and SKYWERX AVIATION, INC a corporation organized and existing under the laws of the State of Nebraska; WHEREAS, the BLAIR AIRPORT AUTHORITY owns and operates an airport known as the Blair Municipal Airport, and BLAIR AIRPORT AUTHORITY is desirous of granting a Non Exclusive FBO franchise to SKYWERX Aviation, INC for the right to engage in the business of providing Blair Municipal Airport with Aviation services only and as outlined in Section 10.12 of the Blair Municipal Airport Rules and Regulations as adopted by the Blair Airport Authority on February 20, 2007 and attached as reference to this agreement as Exhibit A. NOW, THEREFORE, for and in consideration of the fees and covenants of this agreement,,BLAIR AIRPORT AUTHORITY grants to SKYWERX AVIATION, INC the following rights as a FBO at the Blair Municipal Airport upon the following terms and conditions; 1. Term. The term of this right shall be for a period of twenty (20) years, commencing on the 1St day of April, 2012. This agreement shall run concurrent with the Land Lease Agreement for the construction of a Hangar between 125 and 140 foot by 90 foot Hangar dated April 1, 2012. An extension beyond 120 foot shall be subject to written approval by BLAIR AIRPORT AUTHORITY. If SKYWERX AVIATION, INC. and BLAIR AIRPORT AUTHORITY mutually agree to renewal of the aforementioned Land Lease Agreement, then SKYWERX AVIATION, INC. and BLAIR AIRPORT AUTHORITY may mutually agree to renew this FBO Franchise Agreement for up to two (2) addition five (5) years terms by submitting a written notice of intent to exercise renewal at least ninety (90) days prior to the end of the then current franchise agreement term. Consideration for such renewal shall be mutually agreed between the parties pursuant to paragraph 2.c.- herein. 2. User Fees; a. SKYWERX AVIATION, INC agrees to pay a flowage fee of twelve cents per gallon ($.12/gallon) or the fee as may be adjusted periodically under 2.c. of this agreement for all fuel sold for aviation use, including but not limited to Jet A and 10OLL fuel delivered to SKYWERX AVIATION, INC at the airport for sale or use by SKYWERX AVIATION, INC by any supplier for the term of this agreement. b. SKYWERX AVIATION, INC agrees to pay monthly in accordance with the terms as identified herein. Payments shall be due and payable on or before the tenth (1 OtV) day of each calendar month for all fuel delivered during the previous calendar month with or without the demand of the BLAIR AIRPORT AUTHORITY. c, It is expressly understood between the BLAIR AIRPORT AUTHORITY and the SKYWERX AVIATION, INC that the rate of the fuel flowage fee, shall be subject to examination and adjustment at the end of each three (3) year period of this Agreement. Fuel Dispensing a) Fuel. SKYWERX AVIATION, INC shall furnish a letter of product commitment from an oil vendor acceptable to the Blair Airport Authority prior to the effective date of this agreement. SKYWERX AVIATION, INC shall provide at least two (2) grades of aircraft fuel, including 10OLL and JET A. Said fuel shall be that of a vendor acceptable to the BLAIR AIRPORT AUTHORITY, but SKYWERX AVIATION, INC, shall not be required to sell "branded" fuel. Fuel prices shall be posted in public view. b) Fueling Facilities 1) SKYWERX AVIATION, INC shall utilize Blair Airport Authority fuel storage and dispensing pumps and meter, BLAIR AIRPORT AUTHORITY shall be required to maintain all fuel facilities so that they fully comply with requirements set out by the Environmental Protection Agency (EPA), the FAA, and all State of Nebraska Environmental regulations. Maintenance of the facilities shall include maintenance of all fuel dispensing and storage equipment owned by the BLAIR AIRPORT AUTHORITY. SKYWERX AVIATION, INC shall notify BLAIR AIRPORT AUTHORITY immediately in writing should a possible or actual maintenance problem exist with the fuel facilities and such problem is discovered by an agent of SKYWERX AVIATION, INC. 2) SKYWERX AVIATION, INC. shall be required to operate all fuel facilities so that they fully comply with requirements set out by the Environmental Protection Agency (EPA), the FAA, and all State of Nebraska Environmental regulations. 3) Nothing in this agreement will prevent SKYWERX AVIATION, INC., at its sole expense, from securing and operating fuel trucks for refueling provided that all applicable airport, State of Nebraska, and Federal rules, regulations and laws are observed. 4) The FBO shall store, handle and dispose of any hazardous waste or contaminated fuel in accordance with Federal, State and local laws, regulations and ordinances now or hereafter enacted. FBO shall bear all costs for cleanup of hazardous waste or contaminated fuel, consequent to its failure to properly store, handle and dispose of said hazardous waste or contaminated fuel. All hazardous waste, including contaminated fuels, shall be disposed of off the airport property. The 2 FBO shall make available at the request of the Blair Airport Authority or his designated representative, copies of all manifested waste and certification of approved sites. S) SKYWERX AVIATION, INC. shall keep true and accurate records of all fuel procured for use or sale at the Blair Airport 40TA) by SKYWERX AVIATION, INC., and shall keep accurate records of all fuel used or sold by SKYWERX AVITION, INC. at the Blair Airport (KBTA). Simultaneously with the payment of flowage fees, SKYWERX AVIATION, INC. shall provide monthly reports to the Blair Airport Authority regarding such fuel, in a form acceptable to BLAIR AIRPORT AUTHORITY, documenting: a) Fuel procured for use or sale at the Blair Airport. b) Transfers of such fuel into the Blair airport tank farm, and into other storage facilities at the Blair Airport, if applicable. c) Copies of bills of lading, delivery tickets, invoices, or other documents verifying actual quantities of such fuel. d) Fuel meter readings evidencing actual quantities of fuel sold or used. 6) SKYWERX AVIATION, INC shall be responsible for maintaining the registration of all fuel tanks with the appropriate Federal, State, and Local agencies, and any other agency now or hereafter requiring so, and be solely responsible for payment of all registration fees and other associated costs. SKYWERX AVIATION, INC shall annually provide the Blair Airport Authority with copies of all registrations referenced herein. 7) SKYWERX AVIATION, INC shall be responsible for all costs associated with the dispensing of aviation fuel under this agreement for both fill -service and self-service usage. This includes, but is not limited to credit card charges for the sale of Aviation Fuel, all normal operations, excluding all maintenance costs of all fuel dispensing and storage equipment owned by the BLAIR AIRPORT AUTHORITY, and including all costs associated with licensing and monitoring of fuel facilities to meet all Federal and State of Nebraska rules and regulations for sale and storage of fuel for aviation. c) Annual Report Within thirty (30) days after the end of each of the Blair Airport Authority's fiscal years, SKYWERX AVIATION, INC shall submit to the Blair Airport Authority a detailed statement of total gallons of fuel procured for use or sale at the Blair Airport. d) Audit. The Blair Airport Authority, may, at its sole expense, request an independent audit, by a Certified Public Accountant, of fuel flowage hereunder. Any adjustment to fuel flowage payments consequent to any audit made hereunder shall be made forthwith upon completion of such audit, In addition, the Blair. Airport Authority shall have the right at any time during the term of its agreement with the SKYWERX AVIATION, INC to authorize an audit of SKYWERX AVINAON'S records pertaining to its FBO operation on the airport. Such audits shall be undertaken by an independent Certified Public Accountant, satisfactory to the Blair Airport Authority. The cost of such audit shall be borne by the Blair Airport Authority. 4. Insurance and Indemnification a) Fire Insurance. During the fall term of this FBO Franchise agreement, SKYWERX AVIATION, INC shall, at its sole cost and expense, cause all improvements constructed or installed by SKYWERX AVIATION, INC to be kept -insured to the full insurable value atereof against the perils of fire, extended coverage, vandalism, and explosion and like perils, Said insurance shall be procured from a company authorized to do business in the State of Nebraska, including non -admitted insurers, and FBO shall provide the Blair Airport Authority with evidence satisfactory to the Blair Airport Authority that such coverage has been procured and is being maintained. The proceeds of any such insurance, paid on account of any of the perils aforesaid, shall be used to defray the cost of repairing, restoring, or reconstructing said improvements, as necessary; provided, however, that if the permit is canceled, such proceeds shall be used to restore the leased premises to its original condition, including the removal of all buildings, structures and debris. Property insurance policies required by this paragraph shall contain waiver of subrogation endorsements and shall provide that the Blair Airport Authority shall be notified by the insurance company of any renewals, changes or cancellations of such insurance coverage by at least thirty (30) days written notice to the Blair Airport Authority, and shall name the Blair Airport Authority as an additional insured. b) Indemnification. The Blair Airport Authority shall stand indemnified by SKYWERX AVIATION, INC as herein provided. SKYWERX AVIATION is and shall be deemed to be an independent contractor and operator responsible to all parties for its respective acts or omissions, and the Blair Airport Authority shall in no way be responsible therefore. SKYWERX AVIATION, INC covenants and agrees to indemnify, hold harmless and defend Blair Airport Authority, its officers, agents, servants and employees from and against any and all claims for property damage or bodily injury to persons or property arising out of or incident to the leasing of or the use and occupancy of the premises by SKYWERX AVIATION, INC, its 4 employees, patrons, contractors of subcontractors, and SKYWERX AVIATION, INC does hereby assume all liability and responsibility for all claims or suits for damages for bodily injury to persons or damage to property of whatsoever kind or chafacter whether real or asserted, occurring during the term of this FBO FRANCHISE AGREEMENT in connection with the use or occupancy of the premises by SKYWERX AVIATION, INC, its employees, patrons, contractors or subcontractors. SKYWERX AVIATION, INC shall pay promptly when due all bills or charges for construction or maintenance as well as any other amounts due for material or services furnished in connection therewith, and SKYWERX AVIATION, INC shall indemnify the Blair Airport Authority against any and all mechanics liens imposed upon the premises demised hereunder arising as a result of SKYWERX'S conduct or inactivity. SKYWERX AVIATION, INC shall promptly and prior to the effective date of this agreement provide public liability insurance for personal injuries, including death, . growing out of any one accident or other cause in a minimum sum of One Million and No/100 dollars ($1,000,000.00) per occurrence, Two Hundred Thousand and No/100 dollars ($200,000.00) per person. Shall provide property damage liability insurance in a minimum sum of One Million and No/100 dollars ($1,000,000.00) for property damage growing out of any one accident or other cause; shall provide products and completed operations liability insurance in a minimum sum of One Million and No/100 dollars ($1,000,000.00), and shall provide hangar keeper's liability in in a minimum amount of One Hundred Thousand and No/100 dollars ($100,000.00). The Blair Airport Authority may periodically require the above limits of coverage to be adjusted as deemed prudent, but in no case more than once annually. SKYWERX AVIATION, INC shall maintain said insurance with insurance underwriters authorized to do business in the State of Nebraska, including non - admitted insurers, satisfactory to the Blair Airport Authority. SKYWERX AVIATION, INC shall furnish the Blair Airport Authority with a certificate from the insurance carrier showing such insurance to be in full force and effect during the entire term of this agreement. Said certificates shall contain a provision that written notice of cancellation of any material change in said policy to the insurer shall be delivered to the Blair Airport Authority thirty (30) days in advance of the effective date thereof, and said policy shall name the Blair Airport Authority as an additional insured. c. Primary Insurance: Consistent with the indemnification provisions of this Agreement, SKYWERX AVIATION, INC' S insurance policies will respond on a primary basis if the damage or claim is the responsibility and/or caused by the SKYWERX AVIATION, INC, with any insurance carried by BLAIR AIRPORT AUTHORITY to be considered as secondary or excess insurance. 5 5. SKYWERX Aviation, INC Rights. SKYWERX AVIATION, INC shall have the right: a. In common with others so authorized, to use common areas of the airport, including runways, taxiways, aprons, roadways, floodlights, landing lights, signals and other conveniences for the take -off, flying and landing of aircraft. b, To the nonexclusive use, in common with others, of the airport parking areas, appurtenances and improvements thereon, but this shall not restrict the right of the BLAIR AIRPORT AUTHORITY to charge visitors a fee for the use of such areas. c. To operate, maintain, repair and store subject to approval of BLAIR AIRPORT AUTHORITY in the interests of safety and convenience of all concerned, all equipment necessary for the conduct of SKYWERX AVIATION, INC'S business. d. Of access to and from the premises, limited to streets, driveways or sidewalks designated for such purposes by the BLAIR AIRPORT AUTHORITY, and which right shall extend to SKYWERX AVIATION, INC'S employees, passengers, guests, invitces, and patrons. e. All activities of in accordance with this agreement shall comply with laws of the Federal Government, the State of Nebraska, the regulations of the Blair Airport Authority, and the requirements of the Federal Aviation Administration and any other duly authorized governmental agency. 6. Right to Inspect. BLAIR AIRPORT AT_1THORTTY reserves the right to enter upon the premises at any reasonable time for the purpose of malting any inspection it may deem expedient to the proper enforcement of any of the covenants or conditions of this agreement. 7. Transfer. SKYWERX AVIATION, INC may not, at any time during the term of this agreement, assign, or transfer this agreement or any interest therein, without. the written consent of BLAIR AIRPORT AUTHORITY, which consent shall not unreasonably be withheld. 8. Laws and Regulations. SKYWERX AVIATION, INC agrees to observe and obey during the term of this agreement, all laws, ordinances, rules and regulations promulgated and enforced by BLAIR AIRPORT AUTHORITY, and by any other proper authority having jurisdiction over the conduct of the operations at the airport. 9. Hold Harmless. SKYWERX AVIATION, INC agrees to hold BLAIR AIRPORT AUTHORITY free and Harmless from loss from each and every claim and demand of whatever nature, made on behalf of or by any person or persons, for any wrongful, careless or negligent act or omission on the part of SKYWERX AVIATION, INC, it's agents; servants and employees, and from all loss and damages, resulting in bodily injury or property damage, by reason of such acts or omissions. 10. Quiet Enjoyment. So long as SKYWERX AVIATION, INC conducts its business in a fair, reasonable and workmanlike manner, SKYWERX AVIATION, INC shall peaceably have all the rights and privileges granted in this agreement. 11. Signs. SKYWERX AVIATION, INC agrees that no signs or advertising matter may be erected without the written consent of BLAIR AIRPORT AUTHORITY, which consent shall not be unreasonably withheld. 12. Fair and Nondiscriminatory Services. SKYWERX AVIATION, INC in the conduct of furnishing services to the public at the Airport, shall famish services on a fair, equal and not unjustly discriminatory basis to all users, and shall charge fair, reasonable and not unjustly discriminatory prices for each unit or service. 13. Title VI, Civil Rights Assurances. SKYWERX AVIATION, INC, for themselves, their personal representatives, successors in interest, and assigns, agree that (1) no person on the grounds of race, color, or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities, (2) that SKYWERX AVIATION, INC shall use the fuel facilities in compliance with all other requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Department of Transportation, Subtitle A, Office of the Secretary, Pant 21, Nondiscrimination, in Federally Assisted Programs of the Department of Transportation - Effectuation of Title VI of the Civil Rights Act of 1964, and as the Regulations may be amended. 14. Nonexclusive Rights. SKYWERX AVIATION, INC shall have the right and privilege of engaging in and conducting a FBO business on the premises of the airport under the terms and conditions as set forth, provided, however, that this agreement shall not be� construed in any manner to grant SKYWERX AVIATION, INC or those claiming under it the exclusive right to the use of the premises and facilities of the airport other than expressly described herein. 15. Aircraft Service by Owner or Operator. It is clearly understood by SKYWERX AVIATION, INC that no right or privilege has been granted which would operate to prevent any person, firm, or corporation operating aircraft on the airport from performing any, services on its own aircraft with its own regular employees (including, but not limited to, routine maintenance) that it may choose to perform. 16. Hours of Operations. SKYWERX AVIATION, INC agrees to maintain operations during a schedule of hours, which schedule shall be filed with and approved by BLAIR AIRPORT AUTHORITY. Hours of operation shall not be reduced below the minimum without written consent of the BLAIR AIRPORT AUTHORITY, except during any period when the airport is closed by any lawful authority restricting the use in such a 7 manner as to interfere with use by SKYWERX AVIATION, INC for its business operation. Blair Airport Authority shall not be liable for any costs incurred or profits lost by SKYWERX AVIATION, INC due to the closure of the airport due to any lawiifl cause. 17. Jet A Fuel Testing: SKYWERX AVIATION, INC shall pay for any and all fees for testing the fuel used in accordance with this agreement. The testing must be in compliance with the minimum requirements of the Fuel vender and shall comply with the operable Fuel Service Contract between SKYWERX AVIATION and the Fuel vender. 18. Taxes, SKYWERX AVIATION, INC shall pay all taxes or assessments that may be levied against the personal property of SKYWERX AVIATION, INC and/or any and all property taxes assessed on the hangar property subject to this lease throughout the duration of the lease. 19. Airport Development. BLAIR AIRPORT AUTHORITY reserves the right to further develop or improve the airport as it sees fit, regardless of the desires or view of SKYWERX AVIATION, INC, and without interference or hindrance. 20. Blair Airport Authority Rights. BLAIR AIRPORT AUTHORITY reserves the right, but shall not be obligated to SKYWERX AVIATION, INC, to maintain and keep in repair the landing area of the airport and all publicly owned facilities of the airport, together with the right to direct and control all activities of SKYWERX AVIATION, INC in this regard. 21. Subordination Provision. This agreement shall be subordinate to the provisions of any existing or future agreement between BLAIR AIRPORT AUTHORITY and the United States or the State of Nebraska, relative to the operation or maintenance of the airport, the execution of which has been or may be required as a condition precedent to the expenditure of federal or state funds for the development of the airport. Furthermore, this agreement may be amended to include provisions required by those agreements with the United States or the State of Nebraska. 22, Financial Disclosure. SKYWERX AVIATION, INC shall furnish such evidence as maybe reasonably requested by BLAIR AIRPORT AUTHORITY (including Completion of a credit application) to show SKYWERX AVIATION, INC is financially capable of providing the services and facilities set forth in the this agreement. 23. Default. SKYWERX AVIATION, INC shall be deemed in default upon: a. The filing of a petition under the Federal Bankruptcy Act or any amendment, including a petition for reorganization or an arrangement; b. Violation of any restrictions in this agreement, or failure to keep any of its covenants after written notice to cease such violation and failure to correct such violation within thirty (30) days; c. Abandonment of the facilities. d. non-payment of flowage fees at agreed-upon rates; e. non-payment of reimbursements to BLAIR AIRPORT AUTHORITY according to the terms of this agreement. 24. Rights after Termination. In the event of termination for default by SKYWERX AVIATION, INC, the BLAIR AIRPORT AUTHORITY shall have the right at once and without further notice to SKYWERX AVIATION, INC, or surety to take possession of the fuel farms and fuel business inventory of SKYWERX AVIATION, INC, and any and all goods and chattels belonging to SKYWERX AVIATION, INC or its associates which may be found related to this agreement, without being liable for prosecution or to any claim for damages. Upon such termination by default, all rights, powers and privileges of SKYWERX AVIATION, INC shall cease, and SKYWERX AVIATION, INC shall immediately vacate any and all use of fuel facilities occupied by SKYWERX AVIATION, INC under this agreement, and shall make no claim of any kind whatsoever against the BLAIR AIRPORT AUTHORITY, its agents or representatives, by reason of such termination, or any act incident thereto. 25. Choice of Law. This contract shall be governed by Nebraska law and any dispute arising out of or under said agreement shall be heard in the court system of Washington County, Nebraska. Said court system shall be the forum of choice by both parties to this agreement. fl. DATED this 5 day of ly akeA 12 OF 6 AVIATION, INC OF THE