FIRSTGOLD CORP. AIRCRAFT TIME SHARING AGREEMENT
Exhibit
10.25
This
Aircraft Time Sharing Agreement ("Agreement")
by and
between Firstgold Corp. ("Lessee"),
a
Delaware corporation whose address is ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and A. ▇▇▇▇▇ ▇▇▇▇▇▇▇ ("Lessor"),
whose
address is ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ (collectively the
"Parties"),
is
effective December 1, 2006, and shall terminate on December 31, 2015 unless
terminated sooner by either party pursuant to Article 9 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;
and
WHEREAS,
Lessor and Lessee desire to lease said Aircraft on a non-exclusive time sharing
basis as defined in Section 91.501 (c) (1) of the Federal Aviation Regulations
("FAR");
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 Exhibit A hereto, currently owned by Lessor.
WHEREAS,
the use of the Aircraft will at all times be pursuant to and in full compliance
with the requirements of 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:
Use
of
Aircraft.
Lessee
may use the Aircraft from time to time, with the permission and approval of
Lessor, for any and all purposes allowed by FAR 91.501(b)(6). Lessee's use
shall
include the use of the Aircraft by any officer or employee of the Lessee who
has
been authorized by Lessee to use the Aircraft on an as needed basis
(“Authorized
Users”).
Lessee
represents, warrants and covenants to Lessor that:
Lessee
will use such Aircraft for and on Lessee’s own account only and will not use the
Aircraft for the purposes of providing transportation of passengers or cargo
in
air commerce for compensation or hire;
Lessee
shall refrain from incurring any mechanics 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 in 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;
1
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;
Lessee
shall only permit operation of the Aircraft by a fully qualified
pilot.
Lessee
shall provide Lessor with notice of its desire to use the Aircraft and proposed
flight schedules as far in advance of any 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 completed flight promptly upon the completion of each
flight:
departure
point;
destination;
date
and
time of flight;
the
number and identity of passengers and relationship to the Lessee;
the
nature and extent of luggage and/or cargo carried;
the
date
and time of return flight, if any; and
any
other
information concerning the flight that may be pertinent or required by Lessor.
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.
Lessee's
planned utilization of the Aircraft will take precedence over Lessor'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.
Lessor
shall have sole and exclusive authority over the scheduling of the Aircraft.
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 pursuant to this
Agreement for any reason.
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 to Lessee.
2
Cost
of Use of Aircraft.
In
exchange for use of the Aircraft, Lessee shall pay a flat rental rate of $200.00
per hour of flight time utilized by Lessee.
In
addition to the rental rate, 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:
Cost
of
Fuel, Oil, Lubricants and Other Additives;
Travel
expenses of the pilot (if other than an employee of Lessee), including food,
lodging, and ground transportation.
Hangar
and tie-down costs away from the Aircraft's base of operation.
Insurance
obtained for a specific flight.
Landing
fees, airport taxes, and similar assessments.
Customs,
foreign permit, and similar fees directly related to the flight.
Flight
planning and weather contract services.
Lessor
will invoice, and Lessee will pay, for all appropriate charges.
In
addition to the rental rate referenced in Section 3(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).
Invoicing
and Payment.
All
payments to be made to Lessor by Lessee hereunder shall be paid in the manner
set forth in this Paragraph 4. 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 flight time used
and the charges specified in Paragraph 3(b) 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, at its
option, may prepay for the expected use of the Aircraft but in any case, 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 amount upon receipt thereof. All such invoices shall separately itemize
the expenses in items (i) through (vii) of paragraph 3(b) 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 4 after delinquency, including court costs and reasonable attorneys'
fees.
3
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.
Insurance.
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 $______ 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 insurance maintained by Lessor that
may
be payable as a result of any incident or occurrence while an Aircraft is being
operated on behalf of Lessee under this Agreement.
Lessor
shall use his best efforts to procure such additional insurance coverage as
Lessee may request naming Lessee as an additional insured; provided, that the
cost of such additional insurance shall be borne by Lessee pursuant to Paragraph
3(b)(iv) above.
Limitation
of Liability.
Lessee
agrees that the insurance specified in paragraph 5(a) shall provide its sole
recourse for all claims, losses, liabilities, obligations, demands, suits,
judgments or causes of action, penalties, fines, costs and expenses of any
nature whatsoever, including attorneys' fees and expenses for or on account
of
or arising out of, or in any way connected with the use of the Aircraft by
Lessee or its guests, including injury to or death of any persons, including
Lessee’s employees and its guests which may result from or arise out of the use
or operation of the Aircraft during the term of this Agreement ("Claims").
This
Section 5 shall survive termination of this Agreement.
Lessee
agrees that when, in the reasonable view of the Pilot-In-Command of the
Aircraft, safety may be compromised, Lessor or the pilot may terminate a flight,
refuse to commence a flight, or take other action necessitated by such safety
considerations without liability for loss, injury, damage, or delay. Lessee
agrees that Lessee's operation of the Aircraft will be within the operation
guidelines of any pilot operating the Aircraft on behalf of the Lessee who
will
be responsible to operate within the guidelines of FAR 91 and the pilot’s
private pilot certification.
In
no
event shall Lessor be liable to Lessee or its employees, agents,
representatives, guests, or invitees for any claims or liabilities, including
property damage or injury and death, and expenses, including attorney's fees,
in
excess of the amount paid by Lessor's insurance carrier in the event of such
loss.
4
LESSOR
SHALL IN NO EVENT BE LIABLE TO LESSEE OR ITS EMPLOYEES, AGENTS, REPRESENTATIVES,
GUESTS, OR INVITEES FOR ANY INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES AND/OR
PUNITIVE DAMAGES OF ANY KIND OR NATURE UNDER ANY CIRCUMSTANCES OR FOR ANY REASON
INCLUDING ANY DELAY OR FAILURE TO FURNISH THE AIRCRAFT OR CAUSED OR OCCASIONED
BY THE PERFORMANCE OR NON-PERFORMANCE OF ANY SERVICES COVERED BY THIS AGREEMENT.
Covenants
Regarding Aircraft Maintenance.
The
Aircraft has been inspected and maintained in the twelve-month period preceding
the date hereof in accordance with the provisions of FAR Part 91. Lessor shall,
at its own expense, inspect, maintain, service, repair, overhaul, and test
the
Aircraft in accordance with FAR Part 91. The Aircraft will remain in good
operating condition and in a condition consistent with its airworthiness
certification, including all FAA-issued airworthiness directives and mandatory
service bulletins. In the event that any non-standard maintenance is required
during any applicable lease term, Lessor shall immediately notify Lessee of
the
maintenance required, the effect on the ability to comply with Lessee's use
requirements and the manner in which the Parties will proceed with the
performance of such maintenance and conduct of the balance of the planned
flight(s).
No
Warranty.
NEITHER
LESSOR (NOR HIS AFFILIATES) MAKES, HAS MADE OR SHALL BE DEEMED TO MAKE OR HAVE
MADE ANY WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WRITTEN OR
ORAL,
WITH RESPECT TO THE AIRCRAFT TO BE USED HEREUNDER OR ANY ENGINE OR COMPONENT
THEREOF INCLUDING, WITHOUT LIMITATION, ANY WARRANTY AS TO DESIGN, COMPLIANCE
WITH SPECIFICATIONS, QUALITY OF MATERIALS OR WORKMANSHIP, MERCHANTABILITY,
FITNESS FOR ANY PURPOSE, USE OR OPERATION, AIRWORTHINESS, SAFETY, PATENT,
TRADEMARK OR COPYRIGHT INFRINGEMENT OR TITLE.
Operational
Control.
Lessee
shall be responsible for the physical and technical operation of the Aircraft
and the safe performance of all flights performed on behalf of the Lessee.
However, Lessor shall retain ultimate authority and control and possession
of
the Aircraft at all times during the term of this Agreement. In accordance
with
applicable FARs, the qualified pilot provided by Lessee will exercise all
required and/or appropriate duties and responsibilities in regard to the safety
of each flight conducted hereunder. The Pilot-In-Command shall have absolute
discretion in all matters concerning the preparation of the Aircraft for flight
and the flight itself, the load carried and its distribution, the decision
whether or not a flight shall be undertaken, the route to be flown, the place
where landings shall be made and all other matters relating to operation of
the
Aircraft.
5
Lessee
specifically agrees that the flight crew shall have final and complete authority
to delay or cancel any flight for any reason or condition which, in sole
judgment of the Pilot-In-Command, could compromise the safety of the flight
and
to take any other action which, in the sole judgment of the Pilot-In-Command,
is
necessitated by considerations of safety. No such action of the Pilot-In-Command
shall create or support any liability to Lessee or any other person for loss,
injury, damages or delay. The Parties further agree that Lessor shall not be
liable for delay or failure to furnish the Aircraft pursuant to this Agreement
which failure is caused by government regulation or authority, mechanical
difficulty or breakdown, war, civil commotion, strikes or labor disputes,
weather conditions, acts of God or other circumstances beyond Lessor's
reasonable control. Lessee represents that Lessee's operation of the Aircraft
is
within the operational guidelines of the Lessor's Flight Requirements and the
Lessee’s pilots are responsible to operate within the guidelines of FAR 91 and
the pilot’s flight certifications.
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.
Upon
a
termination of this Agreement pursuant to Paragraph 9(a) above, Lessee shall
pay
any and all amounts due to Lessor within ten (10) days of Lessor’s presentment
of a final invoice to Lessee. If Lessee has prepaid for use of the Aircraft,
Lessor shall refund any remaining credit balance to Lessee within twenty (20)
days of the termination date of this Agreement.
Governing
Law.
The
Parties hereto acknowledge that this Agreement shall be governed by and
construed in all respects in accordance with the laws of the State of
California.
Counterparts.
This
Agreement may be executed in one or more counterparts each of which will be
deemed an original, all of which together shall constitute one and the same
agreement.
Entire
Agreement.
This
Time
Sharing Agreement constitutes the entire understanding among the Parties with
respect to its subject matter, and there are no representations, warranties,
rights, obligations, liabilities, conditions, covenants, or agreements other
than as expressly set forth herein.
6
Notices
and Communications.
All
notices, requests, demands and other communications required or desired to
be
given hereunder shall be in writing (except as permitted pursuant to Paragraph
1(c)) and shall be deemed to be given: (i) if personally delivered, upon such
delivery; (ii) if mailed by certified mail, return receipt requested, postage
pre-paid, addressed as follows (to the extent applicable for mailing), upon
the
earlier to occur of actual receipt, refusal to accept receipt or three (3)
days
after such mailing; (iii) if sent by regularly scheduled overnight delivery
carrier with delivery fees either prepaid or an arrangement, satisfactory with
such carrier, made for the payment of such fees, addressed (to the extent
applicable for overnight delivery) as follows, upon the earlier to occur of
actual receipt or the next "Business Day" (as hereafter defined) after being
sent by such delivery; or (iv) upon actual receipt when sent by fax, mailgram,
telegram or email:
If
to
LESSOR:
A.
▇▇▇▇▇
▇▇▇▇▇▇▇
c/o
ASD
Aviation, Inc.
▇▇▇
▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
If
to
LESSEE:
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn:
Corporate Secretary
Notices
given by other means shall be deemed to be given only upon actual receipt.
Addresses may be changed by written notice given as provided herein and signed
by the party giving the notice.
Further
Acts.
Lessor
and Lessee shall from time to time perform such other and further acts and
execute such other and further instruments as may be required by law or may
be
reasonably necessary to: (i) carry out the intent and purpose of this Agreement;
and (ii) establish, maintain and protect the respective rights and remedies
of
the other party.
Successors
and Assigns.
Neither
this Agreement nor any party's interest herein shall be assignable to any other
party whatsoever. This Agreement shall inure to the benefit of and be binding
upon the Parties hereto, their heirs, representatives and successors.
Severability.
In
the
event that any one or more of the provisions of the Agreement shall for any
reason be held to be invalid, illegal, or unenforceable, those provisions shall
be replaced by provisions acceptable to both Parties to this Agreement.
7
Flight
Crew.
Lessee
shall employ, pay for and provide a qualified pilot for all flight operations
under this Agreement performed on behalf of Lessee.
Base
of Operations.
For
purposes of this Agreement, the base of operation of the Aircraft is ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇; provided that such base may be changed
permanently upon notice from Lessor to Lessee.
Taxes.
The
Parties acknowledge that reimbursement of all items specified in Paragraph
3 are
subject to the Federal Excise Tax imposed under Internal Revenue Code 4261
(the
"Commercial
Transportation Tax").
Lessee shall pay to Lessor (for payment to the appropriate governmental agency)
any Commercial Transportation Tax applicable to flights of the Aircraft
conducted hereunder. Lessor shall indemnify Lessee for any claims related to
the
Commercial Transportation Tax to the extent that Lessee has paid Lessor the
amounts necessary to pay such taxes.
Title.
Legal
title to the Aircraft shall remain in the Lessor at all times.
Truth-in-Leasing.
The
Lessor shall mail a copy of this Agreement for and on behalf of both Parties
to:
Flight Standards Technical Division, ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, within twenty-four (24) hours of its execution, as provided by FAR
91.23(c)(1). Additionally, Lessor agrees to comply with the notification
requirements of FAR Section 91.23 by notifying by telephone or in person the
Sacramento FAA Flight Standards District Office at least forty-eight (48) hours
prior to the first flight under this Agreement.
LESSOR
CERTIFIES THAT THE AIRCRAFT HAS BEEN INSPECTED AND MAINTAINED WITHIN THE
12-MONTH PERIOD PRECEDING THE DATE OF THIS AGREEMENT IN ACCORDANCE WITH THE
PROVISIONS OF PART 91 OF THE FEDERAL AVIATION REGULATIONS AND THAT ALL
APPLICABLE REQUIREMENTS FOR THE AIRCRAFT'S MAINTENANCE AND INSPECTION THEREUNDER
HAVE BEEN MET AND ARE VALID FOR THE OPERATIONS TO BE CONDUCTED UNDER THIS
AGREEMENT.
LESSEE,
WHOSE ADDRESS APPEARS IN PARAGRAPH 13 ABOVE AND WHOSE AUTHORIZED SIGNATURE
APPEARS BELOW, AGREES, CERTIFIES AND ACKNOWLEDGES THAT WHENEVER THE AIRCRAFT
IS
OPERATED UNDER THIS AGREEMENT, A QUALIFIED PILOT, WHO MAY BE AN EMPLOYEE OF
LESSEE, SHALL BE KNOWN AS, CONSIDERED AND SHALL IN FACT BE THE OPERATOR OF
THE
AIRCRAFT AND THAT LESSEE UNDERSTANDS ITS RESPONSIBILITIES TO INSURE ITS PILOT
COMPLIES WITH APPLICABLE FEDERAL AVIATION REGULATIONS.
8
THE
PARTIES UNDERSTAND THAT AN EXPLANATION OF FACTORS AND PERTINENT FEDERAL AVIATION
REGULATIONS BEARING ON OPERATIONAL CONTROL CAN BE OBTAINED FROM THE NEAREST
FAA
FLIGHT STANDARDS DISTRICT OFFICE.
IN
WITNESS WHEREOF, the Parties hereto have each caused this Agreement to be duly
executed on the date first set forth above.
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LESSEE:
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| By: | /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ | |
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| Its: Chief Financial Officer | ||
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LESSOR:
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A. ▇▇▇▇▇ ▇▇▇▇▇▇▇ |
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9
EXHIBIT
A
AIRCRAFT
SUBJECT TO TIME SHARING AGREEMENT
Each
of
the undersigned is a party to the Time Sharing Agreement dated
_____________________, 2007, by and between Firstgold Corp. ("Lessee"),
and
A. ▇▇▇▇▇ ▇▇▇▇▇▇▇ ("Lessor")
(collectively the "Parties"),
and
agrees that from and after the date below, until this Exhibit A shall be
superseded and replaced through agreement of the Parties or the Time Sharing
Agreement shall be terminated pursuant to its terms, the Aircraft described
below shall constitute the "Aircraft"
described in and subject to the terms of the Time Sharing Agreement.
Manufacturer's
Serial Number - 1981 Cessna - Centurion P-210
FAA
Registration Number - N168SQ
Engine
Model - Io-540
Dated:
December 1, 2006
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LESSEE:
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| By: | /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ | |
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▇▇▇▇▇ ▇▇▇▇▇▇ |
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| Its: Chief Financial Officer | ||
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LESSOR:
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A. ▇▇▇▇▇ ▇▇▇▇▇▇▇ |
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