TABLE OF CONTENTS
FOR
LEASE AYD-350
Section 1. Letting..................................................... 1
Section 2. Construction by the Lessee.................................. 5
Section 3. Term........................................................ 76
Section 4. Rental...................................................... 76
Section 5. Use of Premises............................................. 106
Section 6. Compliance with Governmental Requirements................... 109
Section 7. Rules and Regulations....................................... 110
Section 8. Various Obligations of the Lessee........................... 111
Section 9. Prohibited Acts............................................. 113
Section 10. Care, Maintenance, Rebuilding and Repair by the Lessee...... 116
Section 11. Insurance................................................... 118
Section 12. Damage to or Destruction of the Premises.................... 120
Section 13. Indemnity and Liability Insurance........................... 120
Section 14. Signs....................................................... 123
Section 15. Obstruction Lights.......................................... 124
Section 16. Additional Rent and Charges................................. 124
Section 17. Rights of Entry Reserved.................................... 125
Section 18. Condemnation................................................ 127
Section 19. Assignment and Sublease..................................... 129
Section 20. Termination by the Port Authority........................... 132
Section 21. Rights of Re-entry.......................................... 134
Section 22. Waiver of Redemption........................................ 134
Section 23. Survival of the Obligations of the Lessee................... 135
Section 24. Reletting by the Port Authority............................. 138
Section 25. Remedies to be Non-Exclusive................................ 139
Section 26. Surrender................................................... 139
Section 27. Acceptance of Surrender of Lease............................ 139
Section 28. Basic Lease................................................. 139
Section 29. Removal of Property......................................... 141
Section 30. Brokerage................................................... 141
Section 31. Limitation of Rights and Privileges Granted................. 142
Section 32. Notices..................................................... 142
Section 33. Other Construction by the Lessee............................ 142
Section 34. Place of Payments........................................... 143
Section 35. Construction and Application of Terms....................... 143
Section 36. Non-liability of Individuals................................ 144
Section 37. Abatement................................................... 144
Section 38. Services to the Lessee...................................... 144
Section 39. Hot Water and Chilled Water Requirements.................... 146
Section 40. JFK Flight Fees Agreement and Airport Fueling Agreements.... 150
Page i
Section 41. Federal Airport Aid......................................... 151
Section 42. Requesting Airlines at the Airport.......................... 151
Section 43. Additional Rights of Termination of the Port Authority as
to Portions of the Premises................................. 159
Section 44. Force Majeure............................................... 188
Section 45. ▇▇▇▇▇▇▇ and Egress.......................................... 188
Section 46. Restrictions on Use of Passenger Terminal Frontage
Roadways-Use of Airport Taxi Dispatchers and Roadways
Frontage ................................................... 189
Section 47. Maintenance Employees....................................... 191
Section 48. Quiet Enjoyment............................................. 191
Section 49. Lessee's Financial Condition - Limitation of Term Lease
-Triggering Events.......................................... 192
Section 50. Right of Termination - Securities Ownership................. 194
Section 51. Assignment to a Trust....................................... 196
Section 52. Purchase of Property........................................ 196
Section 53. Assumption of Maintenance and Repair of the Premises by the
Port Authority.............................................. 197
Section 54. Joint Periodic Condition Survey............................. 202
Section 55. Condition of the Premises................................... 206
Section 56. Environmental Obligations................................... 263
Section 57. Late Charges................................................ 206
Section 58. Airport Transportation Facilities and Operations Use of
Portions of the Premises.................................... 207
Section 59. Club Rooms.................................................. 208
Section 60. Lessee's Service Standards.................................. 209
Section 61. Storage Tanks............................................... 209
Section 62. Non-Discrimination.......................................... 212
Section 63. Affirmative Action.......................................... 213
Section 64. The Lessee's Ongoing Affirmative Action, Equal Opportunity
And Local Business Enterprises Commitment................... 213
Section 65. Books and Records........................................... 215
Section 66. Ground Transportation Services.............................. 219
Section 67. Ground Transportation....................................... 220
Section 68. Ground Transportation Within the Central Terminal Area...... 223
Section 69. Helicopter Operations....................................... 229
Section 70. Itinerant Aircraft.......................................... 229
Section 71. Construction Letter Agreement............................... 229
Section 72. In-Flight Meals............................................. 230
Section 73. Consumer Services........................................... 231
Section 74. Restaurant and Bar.......................................... 246
Section 75. Vending Machines, Public Telephones, Advertising Displays... 247
Section 76. Insurance Covering Air Transportation....................... 247
Section 77. Newsstands.................................................. 248
Section 78. Foreign Currency Exchange................................... 249
Section 79. Retail Banking.............................................. 250
Section 80. Other Consumer Services..................................... 251
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Section 81. Subletting of the Premises for Consumer Services............ 268
Section 82. Obligations in Connection with Consumer Services Agreements. 269
Section 83. Termination by the Lessee................................... 269
Section 84. Memorandum of Agreement..................................... 270
Section 85. No Waiver by the Lessee..................................... 271
Section 86. Roads-No Restriction of Port Authority Right................ 271
Section 87. Port Authority Payments For the Cost of the Redevelopment
Work........................................................ 271
Section 88. Parking Garage.............................................. 299
Section 89. Additional Right of the Port Authority to Terminate a
Portion of the Premises..................................... 299
Section 90. Waiver of Depreciation...................................... 301
Section 91. Port Authority's Rights and the Lessee's Continuing
Obligations with Respect to the Premises and the Terminal
6 Site...................................................... 301
Section 92. Security Agreements......................................... 303
Section 93. Effect of Termination by the Lessee......................... 284
Section 94. Definitions................................................. 285
Section 95. Entire Agreement............................................ 324
Page iii
Terminal Five
Lease
EXHIBITS*
Volume I
--------
Exhibit 1.1 Page 1 of 2 Premises
Exhibit 1.1 Page 2 of 2 Data Table
Exhibit 1.2 Height Elevation Limitations
Exhibit 1.3 Page 1 of 2 Terminal 4 Parcel
Exhibit 1.3 Page 2 of 2 Data Table
Exhibit 1.4 Page 1 of 2 Terminal 6 Parcel
Exhibit 1.4 Page 2 of 2 Data Table
Volume II
---------
Exhibit 2.1 Building No. 60 and Terminal 4, Terminal 6 and
Terminal 7
Exhibit 2.2 Parking Garage Basis of Design
Exhibit 2.3 Parking Garage Site, Off-Premises Roadways &
Utilities Work and various AirTrain components
Exhibit 2.4 Redevelopment of Terminal 5/6 FONSI/ROD
Volume III
----------
Exhibit 2.4 Redevelopment of Terminal 5/6 FONSI/ROD
Volume 2
* These exhibits, other than those that have been filed herewith, are not
available in electronic format and will be provided for inspection upon
written request.
i
Volume IV
---------
Exhibit 2.5 Remedial Action Work Plan
Exhibit 2.6 Terminal 5 Redevelopment Basis of Design
Exhibit 2.7 On-Premises Work
Exhibit 2.8 Off-Premises Work
Exhibit 2.9 Demolition of Structures
Exhibit 2.10 ▇▇▇▇▇▇'s Ongoing Operation including Temporary
Facilities
Volume V
--------
Exhibit 2.11 Stage 2 Construction Trade Cost Estimates
Exhibit 2.12 List of Cost Categories
Exhibit 2.13 Element Budget
Exhibit 2.14 Anticipated Monthly Expenditure Schedule
Exhibit 2.15 Redevelopment Work Project Schedule
Volume VI
---------
Exhibit 2.16 Long Island Well Permit
Exhibit 2.17 5kV Electrical Power and Sanitary Sewer Work
Exhibit 2.18 New Isolation Valve Pit
Exhibit 2.19 Assignment of Redevelopment Work Contracts and
Documents
Exhibit 2.20 Staging Areas
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Exhibit 4.1 Minimum Enplanement Rental
Exhibit 4.2 Per Emplanement Rental Rate
Exhibit 49.1 Triggering Events
Exhibit 56.1 Initial Post Construction Baseline Investigation
Exhibit 56.2 Sampling Locations for the Initial
Post-Construction Baseline
Exhibit 56.3 JFK Terminal 5 - Sampling Zones and Subzones
Exhibit 56.4 JFK Terminal 5 - Historical Port Authority
Analyzed Items
Exhibit 68.1 Central Terminal Area
Exhibit 87.1 Shell Completion Work
Exhibit 87.2 Release of Retainage
Exhibit 89.1 Page 1 of 2 Parcel T
Exhibit 89.1 Page 2 of 2 Data Table
Exhibit 90.1 Election
Exhibit 92.1 Security Agreement AX=782
Exhibit 94.1 Memorandum of Agreement
iii
Final Dated November 22, 2005
THIS AGREEMENT SHALL NOT BE BINDING UPON
THE PORT AUTHORITY UNTIL DULY EXECUTED BY
AN EXECUTIVE OFFICER THEREOF AND DELIVERED
TO THE LESSEE BY AN AUTHORIZED
REPRESENTATIVE OF THE PORT AUTHORITY
Port Authority Lease No. AYD-350
AGREEMENT OF LEASE
THIS AGREEMENT OF LEASE, made as of the 6th day of May, 2005 (which
date is hereinafter called the "Effective Date") by and between THE PORT
AUTHORITY OF NEW YORK AND NEW JERSEY (hereinafter called the "Port Authority"),
a body corporate and politic, established by Compact between the States of New
Jersey and New York with the consent of the Congress of the United States of
America, and having an office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ and State of New York, and JETBLUE AIRWAYS CORPORATION
(hereinafter called the "Lessee"), a corporation of the State of Delaware with
an office and place of business at ▇▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, whose representative is Vice President of Corporate Real Estate.
WITNESSETH, That:
The Port Authority and the Lessee, for and in consideration of the
rents, covenants and mutual agreements hereinafter contained, hereby covenant
and agree effective as of the Effective Date with respect to Sections 2, 6, 7,
28, 30, 32, 35, 36, 56, 62, 63, 65, 84, 85, 87 and 94 hereof and the exhibits
and schedules referred to in such Sections and effective as of November 22, 2005
(the "Lease Commencement Date") with respect to all other portions of this
Agreement as follows:
SECTION 1. LETTING
(a) The Port Authority hereby lets to the Lessee and the Lessee hereby
hires and takes from the Port Authority the land shown in stipple, stippled
diagonal hatching and stippled double parallel vertical hatching on the exhibit
attached hereto, hereby made a part hereof and marked Exhibit 1.1 (which exhibit
is hereinafter referred to as "Exhibit 1.1") at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International
Airport (sometimes hereinafter referred to as the "Airport") in the County of
Queens, City and State of New York, the aforesaid land, together with all
buildings, structures, fixtures, improvements and other property of the Port
Authority located therein, thereon or thereunder, and all structures,
improvements, additions, buildings, installations and facilities located,
constructed or installed, or which may be located, constructed or installed
therein, thereon or thereunder, and the equipment permanently affixed or
permanently located therein, such as electrical, plumbing, sprinkler, fire
protection and fire alarm, heating, steam, sewage, drainage, refrigerating,
communications, gas and other systems, and their pipes, wires, mains, lines,
tubes, conduits, equipment and fixtures, and all paving, drains, culverts,
ditches and catch-basins constructed therein, thereon or thereunder (all of the
foregoing being herein called the "Premises", provided, however, it is hereby
understood and agreed that the AirTrain, the Cogeneration Facility, the Traffic
Systems and the Distribution Portion of the System and Tanks
shall not be a part of the Premises and shall not be or become a part of the
Premises). The parties acknowledge that the Premises constitute non-residential
real property.
(b) Except to the extent required for the performance of any of the
obligations of the Lessee hereunder nothing contained in this Agreement shall
grant to the Lessee any rights whatsoever in the air space above the Premises in
excess of the height elevation limitations described in the exhibit attached
hereto, hereby made a part hereof and marked "Exhibit 1.2".
(c) (i) For the period from the Lease Commencement Date to the day
immediately preceding the Terminal 4 Parcel Tender Date, both dates inclusive,
the area of the Premises as shown in stippled double parallel vertical hatching
and identified as "Area 4" on Exhibit 1.1 together with the contiguous area of
land immediately abutting such portion of the Premises as shown in herringbone
hatching and identified as "Area 3" on Exhibit 1.1 shall be subject to a joint
and mutual easement for the taxiing, push-back, tug-in, turn around and other
operations of aircraft to be used jointly by the Lessee on one hand and the Port
Authority and the lessee(s), tenant(s), occupant(s) or users who pursuant to
Port Authority permission now or in the future lease, rent, occupy or use any of
said area shown in herringbone hatching or adjoining and abutting said area.
(ii) For the period from the Lease Commencement Date to the day
immediately preceding the Terminal 6 Parcel Tender Date, both dates inclusive,
the area of the Premises as shown in stippled diagonal hatching on Exhibit 1.1
together with the contiguous area of land immediately abutting such portion of
the Premises as shown in crosshatching on Exhibit 1.1 shall be subject to a
joint and mutual easement for the taxiing, push-back, tug-in, turn around and
other operations of aircraft to be used jointly by the Lessee on one hand and
the Port Authority and the lessee(s), tenant(s), occupant(s) or users who
pursuant to Port Authority permission now or in the future lease, rent, occupy
or use any of said area shown in crosshatching or abutting and adjoining said
area.
(iii) For the period from and after the Terminal 4 Parcel Tender
Date, the areas of the Premises as shown in crosshatching and dashed horizontal
hatching with crosshatching on the exhibit attached hereto, hereby made a part
hereof and marked "Exhibit 1.3" (herein referred to as "Exhibit 1.3") together
with the contiguous area of land immediately abutting such portion of the
Premises as shown in diagonal hatching and in shaded stipple with diagonal
hatching on Exhibit 1.3 shall be subject to a joint and mutual easement for the
taxiing, push-back, tug-in, turn around and other operations of aircraft to be
used jointly by the Lessee on one hand and the Port Authority and the lessee(s),
tenant(s), occupant(s) or users who pursuant to Port Authority permission now or
in the future lease, rent, occupy or use any of said area shown in shaded
stipple with diagonal hatching or adjoining and abutting said area.
(iv) For the period from and after the Terminal 6 Parcel Tender
Date the area of the Premises as shown in stippled diagonal hatching on the
exhibit attached hereto, hereby made a part hereof and marked "Exhibit 1.4"
(herein referred to as "Exhibit 1.4") together with the contiguous area of land
immediately abutting such portion of the Premises as shown in crosshatching on
Exhibit 1.4 shall be subject to a joint and mutual easement for the taxiing,
push-back, tug-in, turn around and other operations of aircraft to be used
jointly by the Lessee on one
2
hand and the Port Authority and the lessee(s), tenant(s), occupant(s) or users
who pursuant to Port Authority permission now or in the future lease, rent,
occupy or use any of said area shown in crosshatching or abutting and adjoining
said area.
(d) Without limiting any obligation of the Lessee to commence
operations hereunder at the time and in the manner stated elsewhere in this
Agreement, the Lessee agrees that no portion of the Premises will be used
initially or at any time during the letting which is in a condition unsafe or
improper for the conduct of the Lessee's operations hereunder so that there is
possibility of injury or damage to life or property. It is hereby understood and
agreed that whenever reference is made in this Agreement to the condition of the
Premises as of the commencement of the term thereof, the same shall be deemed to
mean the condition of the Premises as of the Lease Commencement Date, and as to
the improvements made and the alteration work performed during the term of this
Agreement, in the condition existing after the completion of the same.
(e) (i) Effective at 12:01 a.m. on the day of tender thereof by the
Port Authority to the Lessee, which tender shall be made upon thirty (30) days'
notice (the "Terminal 4 Notice") to the Lessee by the Port Authority (the
effective date of the Terminal 4 Notice being herein referred to as the
"Terminal 4 Parcel Tender Date"), in addition to the premises heretofore let to
the Lessee under this Lease, the letting of which shall continue in full force
and effect, the Port Authority shall let to the Lessee and the Lessee shall hire
and take from the Port Authority upon all the terms, provisions, conditions and
agreements of this Lease at the Airport in the County of Queens, City and State
of New York the land shown in dashed horizontal hatching with crosshatching on
Exhibit 1.3 (which land is hereinafter referred to as the "Terminal 4 Parcel"),
together with the fixtures, improvements and other property of the Port
Authority located or to be located therein, thereunder or thereon, and all
structures, improvements, additions, buildings and facilities, located,
constructed or installed or to be located, constructed or installed therein,
thereunder or thereon, all of the foregoing to be and become a part of the
Premises let under this Lease, subject to all of the terms, provisions,
covenants and conditions of this Lease, for and during the balance of the term
of the letting under this Lease subject to earlier termination as provided in
this Lease.
(ii) If the Port Authority shall not give possession of the
Terminal 4 Parcel during the Term by reason of the fact that the Terminal 4
Parcel or any part thereof are in the course of construction, repair, alteration
or improvement or by reason of the fact that the occupant thereof failed or
refused to deliver possession to the Port Authority, or by reason of any cause
or condition beyond the control of the Port Authority, the Port Authority shall
not be subject to any liability for the failure to give possession of the
Terminal 4 Parcel to the Lessee.
(f) (i) Effective as of the Terminal 4 Parcel Tender Date, the Lessee
shall and be deemed to have granted, bargained, sold, surrendered and yielded up
and by these presents have granted, bargained, sold, surrendered and yielded up
unto the Port Authority, its successors and assigns, forever, its rights in that
portion of the Premises shown in shaded stipple and shaded stipple with diagonal
hatching on Exhibit 1.3 (the "Terminal 4 Surrendered Parcel") and the term of
years with respect thereto under the Lease yet to come and shall and be deemed
to have given, granted, surrendered and by these presents does give, ▇▇▇▇▇ and
surrender to the
3
Port Authority, its successors and assigns, all the rights, rights of renewal,
licenses, privileges and options of the Lessee granted by the Lease with respect
to the Terminal 4 Surrendered Parcel, all to the intent and purpose that the
said term under the Lease and the said rights of renewal, licenses, privileges
and options may be wholly merged, extinguished and determined on the Terminal 4
Parcel Tender Date, with the same force and effect as if the said term were in
and by the provisions of the Lease originally fixed to expire on the Terminal 4
Parcel Tender Date, but the Lease and the letting thereunder shall continue in
full force and effect as to the remainder of the Premises under the Lease and in
accordance with all the terms and provisions thereof.
TO HAVE AND TO HOLD the same unto the Port Authority, its
successors and assigns forever.
(ii) The Lessee hereby covenants on behalf of itself, its
successors and assigns that (x) it has not done or suffered and will not do or
suffer anything whereby the Terminal 4 Surrendered Parcel or the Lessee's
leasehold therein, has been or shall be encumbered as of the Terminal 4 Parcel
Tender Date in any way whatsoever; (y) the Lessee is and will remain until the
Terminal 4 Parcel Tender Date the sole and absolute owner of the leasehold
estate in the Terminal 4 Surrendered Parcel and of the rights, rights of
renewal, licenses, privileges and options granted by the Lease with respect
thereto and that the same are and will remain until the Terminal 4 Parcel Tender
Date free and clear of all liens and encumbrances of whatsoever nature; and (z)
the Lessee has full right and power to make this agreement.
(iii) All promises, covenants, agreements and obligations of the
Lessee with respect to the Terminal 4 Surrendered Parcel which under the
provisions thereof would have matured upon the date originally fixed in the
Lease for the expiration of the term thereof, or upon the termination of the
Lease prior to the said date, or within a stated period after expiration or
termination shall, notwithstanding such provisions, mature upon the Terminal 4
Parcel Tender Date and shall survive the delivery of the Terminal 4 Notice by
the Port Authority to the Lessee.
(iv) As of the Terminal 4 Parcel Tender Date, the Lessee shall
and shall have released and discharged and does by these presents release and
discharge the Port Authority from any and all obligations on the part of the
Port Authority to be performed under the Lease with respect to the Terminal 4
Surrendered Parcel. The Port Authority does by these presents release and
discharge the Lessee from any and all obligations on the part of the Lessee to
be performed under the Lease with respect to the Terminal 4 Surrendered Parcel
for that portion of the term subsequent to the Terminal 4 Parcel Tender Date; it
being understood that nothing herein contained shall release, relieve or
discharge the Lessee from any liability for rentals or for other charges that
may be due or become due to the Port Authority for any period or periods prior
to the Terminal 4 Parcel Tender Date, or for breach of any other obligation on
the Lessee's part to be performed under the Lease for or during such period or
periods or maturing pursuant to the foregoing paragraph, nor shall anything
herein be deemed to release the Lessee from any liability for rentals or other
charges that may be due or become due to the Port Authority for any other
portion of the Premises or for breach of any other obligation on the Lessee's
part to be performed under the Lease.
4
(v) The Lessee hereby agrees to terminate its occupancy of the
Terminal 4 Surrendered Parcel and to deliver actual, physical possession of the
Terminal 4 Surrendered Parcel to the Port Authority, on or before the Terminal 4
Parcel Tender Date, in the condition required by the Lease upon surrender. The
Lessee further agrees that it shall remove all the Lessee's Personal Property
from Terminal 4 Surrendered Parcel prior to the Terminal 4 Parcel Tender Date,
and all the terms and conditions of Section 29 of the Lease with respect to
termination of the letting shall apply to any of the Lessee's Personal Property
not so removed.
(vi) The Lessee hereby acknowledges that each and every term,
provision and condition of the Lease shall continue to apply to the Premises
remaining after the termination of the Terminal 4 Surrendered Parcel.
(vii) From and after the day immediately following the Terminal 4
Parcel Tender Date, the Lessee shall be entitled to an abatement of the First
Ground Rental and/or the Second Ground Rental in accordance with Section 4
hereof.
(g) Effective at 12:01 a.m. on the day immediately following the
expiration or earlier termination (the "Terminal 6 Parcel Tender Date") of that
certain agreement of lease entered into between the Lessee and the Port
Authority as of the 1st day of November, 2002 covering Terminal 6 and bearing
Port Authority agreement no. AYD-265 ("Lease AYD-265") in addition to the
premises heretofore let to the Lessee under this Lease, the letting of which
shall continue in full force and effect, the Port Authority shall let to the
Lessee and the Lessee shall hire and take from the Port Authority upon all the
terms, provisions, conditions and agreements of this Lease at the Airport in the
County of Queens, City and State of New York the land shown in stipple and
stippled diagonal hatching on Exhibit 1.4 (which land is hereinafter referred to
as the "Terminal 6 Parcel"), together with the fixtures, improvements and other
property of the Port Authority located or to be located therein, thereunder or
thereon, and all structures, improvements, additions, buildings and facilities,
located, constructed or installed or to be located, constructed or installed
therein, thereunder or thereon, all of the foregoing to be and become a part of
the Premises let under this Lease, subject to all of the terms, provisions,
covenants and conditions of this Lease, for and during the balance of the term
of the letting under this Lease subject to earlier termination as provided in
this Lease.
(h) The Lessee shall have a non-exclusive right of way for the passage
of vehicles through the area shown in stippled cross hatching on Exhibit 1.1,
which area shall not in any event be obstructed by the Lessee or used by the
Lessee for any other purpose including without limitation for the parking or
storage of any equipment or vehicles.
SECTION 2. CONSTRUCTION BY THE LESSEE
(a) The following terms, when used in this Agreement, shall, unless
the context shall require otherwise, have the respective meanings given below:
(i) "Building No. 60" shall mean the TWA Main Terminal as shown
in stippled crosshatching on the exhibit attached hereto, hereby made a part
hereof and marked "Exhibit 2.1" (herein referred to as "Exhibit 2.1"), the
Flight Wing I Tube and the Flight Wing II Tube.
5
(ii) "Director of Redevelopment of the Port Authority" shall mean
the person or persons from time to time designated by the Port Authority to
exercise the powers and functions vested in the said Director of Redevelopment
of the Port Authority by this Agreement; but until further notice from the Port
Authority to the Lessee it shall mean the Program Director of the JFK
Redevelopment Program (or the temporary or acting Program Director of the JFK
Redevelopment Program) for the time being, or his duly designated representative
or representatives.
(iii) "Element of Work" shall mean each of and "Elements of Work"
shall mean all of the Passenger Terminal Work, the Landside Civil Work, the
Airside Civil Work, the MOA Curtain Wall Work, the Parking Garage Work, the MOA
Flight Wing II Work and the Terminal 5 AirTrain Connector Work.
(iv) "Flight Wing I Tube" shall mean the pedestrian bridge shown
in diagonal hatching and identified as the "Flight Wing I Tube" on Exhibit 2.1.
(v) "Flight Wing II Tube" shall mean the pedestrian bridge shown
in crosshatching on Exhibit 2.1 and identified as the "Flight Wing II Tube on
Exhibit 2.1.
(vi) "Group VI Aircraft" shall mean the FAA Airplane Design Group
for wingspans greater than 214 feet.
(vii) "New Passenger Terminal" shall mean the new passenger
terminal to be designed and constructed by the Lessee pursuant to and in
accordance with this Lease.
(viii) "Parking Garage" shall mean the parking garage to be built
by the Lessee pursuant to and in accordance with this Lease.
(ix) "Parking Garage Basis of Design" shall mean the document
attached hereto entitled "jetBlue Airways JFK International Airport Terminal 5
Redevelopment Basis of Design - Parking Garage, November 15, 2005" hereby made a
part hereof and marked "Exhibit "2.2".
(x) "Parking Garage Site" shall mean the area shown in stipple
and stippled crosshatching on the exhibit attached hereto, hereby made a part
hereof and marked "Exhibit 2.3" (which exhibit is herein referred to as "Exhibit
2.3").
(xi) "Port Authority Service Contract" shall mean each of the
Parking Garage Vertical Circulation Maintenance Contract, the Parking Garage
Fire Safety Equipment Maintenance Contract, the AirTrain Vertical Circulation
Maintenance Contract and the AirTrain Moving Sidewalk Maintenance Contract.
(xii) "Project Costs" shall mean the Cost of the Lessee's
Redevelopment Work Elements and all other costs and expenses of the Lessee to
comply with all
6
of the terms and conditions of this Section 2 with respect to the Redevelopment
Work except for the Cost of the Port Authority Redevelopment Work Elements.
(xiii) "Redevelopment of Terminal5/6 FONSI/ROD" shall mean the
United States of America, Federal Aviation Administration Finding of No
Significant Impact Record of Decision approved on February 7, 2005 for the
Redevelopment of Terminals 5 and 6 at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport, a
copy of which together with the Environmental Assessment dated October 2004 on
which it was based is attached hereto, hereby made a part hereof and marked
"Exhibit 2.4".
(xiv) "Redevelopment Work Construction Applications" shall mean
all of the Tenant Construction or Alteration Applications submitted by the
Lessee pursuant to Section 2 of this Lease as approved by the Port Authority.
(xv) "Redevelopment Work Contract" shall mean each agreement
entered into by the Lessee, including without limitation those entered into
prior to the Effective Date, relating to the Redevelopment Work including
without limitation all such agreements with architects, engineers, contractors,
consultants, subcontractors, the Contract Documents and all other agreements
entered into by the Lessee for the supply of labor, materials and equipment
relating to the Redevelopment Work (including without limitation to guaranties,
payment bonds and surety agreements) and all amendments, modifications,
supplements, extensions and renewals.
(xvi) "Redevelopment Work Contractor" shall mean each Person that
is or is to be a party to a Redevelopment Work Contract, except for the Lessee.
(xvii) "Redevelopment Work Contracts and Documents" shall mean
all Redevelopment Work Contracts, all Design Development Documents, all Contract
Documents and all plans and specifications for the development and construction
of the Redevelopment Work, all service, maintenance and warranties provided by a
Redevelopment Work Contractor related to the Redevelopment Work, all other
contracts and agreements related to the Redevelopment Work and all amendments,
modifications, supplements, extensions and renewals thereof.
(xviii) "Redevelopment Work Site" shall mean each of, and
"Redevelopment Work Sites" shall mean all of, the following areas: the area
shown in stipple on the exhibit attached hereto, hereby made a part hereof and
marked "Exhibit 2.7" (herein referred to as "Exhibit 2.7"), the area shown in
broken horizontal hatching on Exhibit 2.7, the area shown in crosshatching on
Exhibit 2.7, the area shown in broken horizontal hatching with crosshatching on
Exhibit 2.7, the area shown in crosshatching on the exhibit attached hereto,
hereby made a part hereof and marked "Exhibit 2.8" and the Parking Garage Site.
(xix) "Remedial Action Work Plan" shall mean the remedial action
work plan attached hereto, hereby made a part hereof and marked "Exhibit 2.5" as
the same may be amended and supplemented from time to time.
7
(xx) "Resident Engineer" shall mean the person or persons from
time to time designated by the Port Authority to exercise the powers and
functions vested in the said Resident Engineer by this Agreement; but until
further notice from the Port Authority to the Lessee it shall mean the Port
Authority Resident Engineer (or the temporary or acting Port Authority Resident
Engineer) located in Building 14 of the Airport for the time being, or his duly
designated representative or representatives.
(xxi) "Temporary Facilities" shall mean the facilities and
improvements constructed and installed on the Premises as part of the Temporary
Facilities Work.
(xxii) "Terminal 4", "Terminal 6" and "Terminal 7" shall mean the
passenger terminal buildings at the Airport identified as such on Exhibit 2.1.
(xxiii) "Terminal 5 AirTrain Connector Site" shall mean the area
shown in crosshatching and identified as such on Exhibit 2.3.
(xxiv) "Terminal 5/6 AirTrain Station" shall mean the AirTrain
station, identified as such on Exhibit 2.3 that serves Terminal 5 and Terminal
6.
(xxv) "Terminal 5 Redevelopment Basis of Design" shall mean the
document attached hereto, entitled "jetBlue Airways JFK International Airport
Terminal 5 Redevelopment - Basis of Design" dated November 1st, 2005 hereby made
a part hereof and marked "Exhibit 2.6".
(xxvi) "Terminal/5 6 AirTrain Connector" shall mean the AirTrain
Connector identified as such on Exhibit 2.3.
(b) ▇▇▇▇▇▇'s Comprehensive Plan for the Redevelopment Work:
(1) The Lessee shall, prior to its submission to the Port
Authority of the plans and specifications for the Redevelopment Work as
hereinafter provided for, submit to the Port Authority for its consent, the
Lessee's comprehensive plan for the planning, design and performance of the
Redevelopment Work including, but not limited to, renderings, layouts,
locations, models, functional plans, staging plans and project schedule. Said
comprehensive plan shall be based upon the Terminal 5 Redevelopment Basis of
Design and the Parking Garage Basis of Design together with the further design
development documents based thereon (which further design development documents
as approved by the Port Authority are herein called the "Design Development
Documents") which shall be prepared by the Lessee and submitted to the Port
Authority for its approval; said comprehensive plan as approved by the Port
Authority shall constitute the Lessee's "Comprehensive Plan" hereunder. The
Design Development Documents shall clearly delineate each Element of Work from
each other Element of Work and the Design Development Documents shall include a
composite drawing clearly depicting the limits of each Element of Work. The
Lessee shall keep the Comprehensive Plan up to date and shall submit to the Port
Authority for its approval all amendments, supplements or modifications thereto,
which amendments, supplements or modifications shall not become effective until
the same have been approved by the Port Authority. If the Port Authority
disapproves the Lessee's further design development documents or any portion
thereof, or any submittals in connection with the
8
Comprehensive Plan, it shall set forth, in writing, in reasonable detail the
reasons for such disapproval.
(2) Without limiting the foregoing the Lessee agrees that the
Comprehensive Plan shall include the design and construction of the Passenger
Terminal Work, the Landside Civil Work, the Airside Civil Work, the MOA Curtain
Wall Work, the MOA Flight Wing II Work, the Parking Garage Work and the Terminal
5 AirTrain Connector Work as more particularly described below:
(i) The "Passenger Terminal Work" shall mean and consist of
the work set forth in the following items (aa) through (jj) and all necessary
and appropriate work in connection therewith including without limitation the
work set forth in subparagraphs (2)(viii) and (2)(ix) of this paragraph (b) as
follows:
(aa) A main passenger terminal building of
approximately 635,000 square feet of floor space;
(bb) Space, facilities, equipment for passenger
departure functions including, but not limited to, sufficient curbside,
lobby and kiosk facilities for ticketing, baggage check-in, security
screening positions, gate holdroom and passenger arriving functions
including, but not limited to, facilities for not less than six (6) baggage
claim devices;
(cc) Twenty six (26) aircraft passenger enplaning and
deplaning contact gates, together with all associated preconditioned air
and ground power support and related areas and facilities including without
limitation 26 passenger boarding bridges and 13 fixed links;
(dd) All appropriate and necessary work for the
construction of Concession Areas consisting of a minimum of 50,000 total
square feet of floor space to be made available for consumer services as
more fully described and set forth in Sections 73 through 81 hereof
including without limitation the construction and installation of utility
lines which are to serve the Concession Areas;
(ee) All necessary and required work for the
construction of a Consolidated Counter for Ground Transportation Operators
for use in accordance with Section 66 hereof entitled "Ground
Transportation Services" at such location as may be specified by the Port
Authority as may reasonably be required for use as Consolidated Counters;
(ff) All interior vertical circulation areas,
facilities and systems in connection with the Terminal 5 AirTrain
Connector, including without limitation, escalators, elevators, stairs and
passageways, and all work to connect, extend, integrate, interface, support
and accept the Terminal 5 AirTrain Connector to the New Passenger Terminal
and to the Terminal 5/6 AirTrain Station, including without limitation
making the connections and integration water tight;
9
(gg) All departure level roadway structures including
piles, foundations, substructure, superstructure, structural slabs,
drainage and lighting infrastructure to support upper level roadways and
frontage to be built above the arrivals hall;
(hh) Structural modifications to the Flight Wing I
Tube, a new terminus and vertical circulation at the New Passenger Terminal
end of the Flight Wing I Tube and the retention of the entire visible
exterior length of the Flight Wing 1I Tube, as required in paragraph (c) of
this Section and;
(ii) Investigation of a hierarchy of options for the
Flight Wing I Tube as required in paragraph (c) of this Section for
presentation to the RAC and all work necessary and desirable to implement
the option selected by the Port Authority; and
(jj) Such public access to the New Passenger Terminal
from Building No. 60 through both the Flight Wing I Tube and the Flight
Wing II Tube as shall be determined by the Port Authority after
consultation with the RAC and the Lessee.
(ii) The "Landside Civil Work" which shall mean and consist
of the work set forth in the following items (aa) through (gg) and all necessary
and appropriate work in connection therewith including without limitation the
work set forth in subparagraphs (2)(viii) and (2)(ix) of this paragraph (b):
(aa) The construction in, on and under the area shown
in crosshatching and broken horizontal hatching with crosshatching on
Exhibit 2.7.
(A) All upper level and lower level roadways
exclusive of the upper level roadway substructure over the arrivals
hall included in the Passenger Terminal Work, and all other necessary
or appropriate ground and elevated roadways, ramps, sidewalks,
vehicular service areas, vehicular staging areas and pedestrian
circulation areas shown in crosshatching on Exhibit 2.8 together with
all related and associated areas and facilities including without
limitation associated drainage, street lighting, vehicular and
pedestrian signage, and traffic control infrastructure (the foregoing
being herein sometimes called the "Premises Circulation Facilities");
and
(B) New Airport roads and roadway ramps to provide
access to the New Passenger Terminal, recirculation roadways to the
Parking Garage and to connect certain portions of the Premises
Circulation Facilities to Building No. 60, the Parking Garage and
Terminal 6, and vehicular roadways and pedestrian walkways, and other
areas, structures and facilities related to or associated therewith,
including without limitation, ground lighting, the maintenance and
protection of traffic and the maintenance of temporary roads and
signage, such work to be performed generally in the area shown in
10
crosshatching on Exhibit 2.8, it being understood and agreed that such
roadways and roads shall allow vehicles to access all of the Building
No. 60 frontage roadway, Terminal 6 access roadways, adjacent
leaseholds or the arrivals and departures roadways of the New
Passenger Terminal or the Parking Garage;
(C) New roadways and all associated and related
extensions, widenings, relocations, and rehabilitation of existing
roadways to provide access to the New Passenger Terminal,
recirculation roadways to the Parking Garage and to connect certain
portions of the Premises Circulation Facilities to Building No. 60 and
Terminal 6, and vehicular roadways and pedestrian walkways, and other
areas, structures and facilities related to or associated therewith,
ground lighting, and the maintenance and protection of traffic, it
being understood and agreed that such roadways and roads shall allow
vehicles to access all of the arrivals and departures roadways of the
New Passenger Terminal, or Building No. 60 frontage roadways or
Terminal 6 access roadways or the Parking Garage; all of the foregoing
to be constructed in the area shown in crosshatching on Exhibit 2.8;
(bb) All required ground transportation functions,
including without limitation, all necessary and required work to
accommodate baggage cart racks and construct taxi dispatch booths
(including without limitation required and appropriate infrastructure for
communication and electrical power) and bus shelters as may be required to
adequately serve the Premises at such locations as may be determined by the
Port Authority;
(cc) All necessary and required work to conform to Port
Authority frontage control requirements including without limitation
signage, CCTV, public address systems, street lighting;
(dd) All necessary and required work to conform to Port
Authority requirements for access to passenger terminal areas and public
parking areas including static and dynamic sign systems and traffic lights
and other traffic control devices and systems including without limitation
associated overhead structures and foundations, as specified and required
by the Port Authority;
(ee) All necessary and required work to provide
canopies over all pedestrian waiting and crossing areas on the Premises,
including without limitation, all ground transportation waiting, loading
and unloading areas;
(ff) All necessary and required work to provide a
secure loading dock and trash containment/pick-up area; and
(gg) All grading and paving of ground areas and
appropriate landscaping together with all related and associated work
including without limitation all hardscape and irrigation of unpaved areas.
11
(iii) The "Airside Civil Work" shall mean and consist of the
work set forth in the following items (aa) through (dd) and all necessary and
appropriate work in connection therewith including without limitation the work
set forth in subparagraphs (2)(viii) and (2)(ix) of this paragraph (b):
(aa) All necessary and appropriate aircraft ramp and
apron areas for 26 aircraft passenger enplaning and deplaning contact gate
and remote parking positions;
(bb) Subject to and in accordance with paragraph (o) of
this Section, the construction and installation of additions and
modifications to and relocations of the underground fuel system, including
but not limited to additions and modifications to and relocations of the
Distribution Portion of the System and the Airline Terminal Portion of the
System and underground pipelines, fuel mains, and stubs necessary or
required to tie into the Distribution Portion of the System at the Airport
to accommodate and serve the Premises and all aircraft gate positions
located or to be located at the Premises and the construction and
installation of such additions and modifications to and relocations of the
Distribution Portion of the System and the Satellite Portion of the System
necessary or required by any changes to the Airline Terminal Portion of the
System or the Distribution Portion of the System made by the Lessee,
including but not limited to, transfer pumps, filter vessels, emergency
fuel shutdown, and control systems associated with Premises Distribution
Lines 402-1, 402-2, 402-3, it being understood that the maintenance,
operation and repair of the Satellite Portion of the System shall not be
part of the Redevelopment Work;
(cc) Appropriate measures to protect against jet blast
for areas adjacent to the Premises; and
(dd) All taxiway access stubs, taxilanes and associated
and related areas and facilities, including without limitation signage,
pavement markings, edge lights and lead-in lights, which taxilanes in the
area shown in stippled double parallel vertical hatching on Exhibit 1.1 and
in the area shown in shaded stippled diagonal hatching on Exhibit 1.3 and
in the area shown in stippled diagonal crosshatching on Exhibit 1.4. Any
new or reconstructed taxilanes to be constructed on the area shown in
stippled double parallel vertical hatching on Exhibit 1.1 shall be
constructed to accommodate use by Group VI aircraft.
(iv) The "MOA Curtain Wall Work" shall mean and consist of
work actually performed, labor actually furnished and materials actually
furnished and installed in connection with the construction of that portion of
the facade and curtain wall of the New Passenger Terminal which faces Building
No. 60, but only if such costs are required solely to satisfy the requirements
of the MOA and paragraph (c) of this Section. The MOA Curtain Wall Work, if
performed, shall be performed pursuant to a Port Authority Requested Change
Order.
(v) The "MOA Flight Wing II Work" shall mean and consist of
the relocation and incorporation of the Flight Wing II gate lounge "trumpets" as
shown in stipple
12
on Exhibit 2.1 and/or other architecturally significant elements as and if
required by and in accordance with the MOA and paragraph (c) of this Section
together all necessary and appropriate work in connection therewith including
without limitation the work set forth in subparagraphs (2)(viii) and (2)(ix) of
this paragraph (b). The MOA Flight Wing II Work, if performed, shall be
performed pursuant to a Port Authority Requested Change Order.
(vi) The "Parking Garage Work" shall mean and consist of the
work set forth in the following items (aa) through (ii) and all necessary and
appropriate work in connection therewith including without limitation the work
set forth in subparagraphs (2)(viii) and (2) (ix) of this paragraph (b) as
follows:
(aa) An elevated parking garage structure having a
minimum of 1500 public parking spaces;
(bb) All roadways and all other necessary or
appropriate ground roadways, ramps, sidewalks, vehicular service areas,
vehicular staging areas and pedestrian circulation areas, together with all
related and contiguous associated areas and facilities located within the
Parking Garage Site (the foregoing being herein sometimes called the
"Parking Garage Circulation Facilities");
(cc) Vehicular entry plaza(s) including without
limitation the Port Authority Airport parking revenue control system
("RCS") ticket dispensing equipment, communications and associated
infrastructure and vehicular exit plaza(s) including without limitation a
service building, toll booths containing RCS equipment, communications and
associated infrastructure, which equipment shall be procured from the Port
Authority's contractor for the RCS and the installation, testing,
commissioning and acceptance of the system shall be coordinated with such
RCS contractor;
(dd) All necessary or required work to conform to Port
Authority requirements for access to passenger terminal areas and public
parking areas including static and dynamic sign systems and traffic lights
and other traffic control devices and systems as specified and required by
the Port Authority;
(ee) All vertical circulation areas, facilities and
systems, including without limitation, a central core of elevators, stairs
and passageways and all work to connect, extend, integrate, support and
accept the vertical circulation to the Parking Garage, including without
limitation making the vertical circulation system water tight, and a
maintenance contract for the vertical circulation equipment and systems for
a period of one year from the date Port Authority issues a certificate to
use such portion of the Redevelopment Work as described in paragraph (n) of
this Section (the "Parking Garage Vertical Circulation Maintenance
Contract");
(ff) All work to connect, extend, integrate, support
and accept the Terminal 5/6 AirTrain Station to the Parking Garage;
13
(gg) All necessary or required work to connect the
Parking Garage fire alarm system to the Airport fire alarm system including
coordination for installation, testing, commissioning and acceptance of the
system and a maintenance contract for the fire alarm equipment and system
for a period of one year from the date the Port Authority issues a
certificate to use such portion of the Redevelopment Work as described in
paragraph (n) of this Section (the "Parking Garage Fire Safety Equipment
Maintenance Contract");
(hh) All necessary or required fencing at locations
identified by the Port Authority; and
(ii) All necessary or required work for communication
infrastructure for emergency phone service and elevator closed circuit TV
in accordance with Port Authority standards.
(vii) The "Terminal 5 AirTrain Connector Work" shall mean
and consist of the work set forth in the following items (aa) through (dd) and
all necessary and appropriate work in connection therewith including without
limitation the work set forth in subparagraphs (2)(viii) and (2)(ix) of this
paragraph (b) as follows:
(aa) An enclosed, climate controlled, pedestrian
connector from the Terminal 5/6 AirTrain Station connector to the New
Passenger Terminal providing grade separated crossing of all active
roadways (the "Terminal 5 AirTrain Connector");
(bb) All required vertical circulation elements
including escalators and elevators to provide for elevation changes to
access the Terminal 5 AirTrain Connector and at other necessary locations
and a maintenance contract for the vertical circulation equipment and
systems for a period of one year from the date Port Authority issues a
certificate to use such portion of the Redevelopment Work as described in
paragraph (n) of this Section (the "AirTrain Vertical Circulation
Maintenance Contract");
(cc) Moving walkways in the enclosed horizontal
elements of the connector and a maintenance contract for the moving walkway
equipment and systems for a period of one year from the date the Port
Authority issues a certificate to use such portion of the Redevelopment
Work as described in paragraph (n) of this Section (the "AirTrain Moving
Sidewalk Maintenance Contract"); and
(dd) Extension and modification of existing systems,
including but not limited to, mechanical, electrical, control, fire
protection, communication and security systems, from the Terminal 5/6
AirTrain Connector to provide an environment consistent with the AirTrain
systems.
14
(viii) All other necessary and appropriate work in
connection with the foregoing clauses (2)(i) through (2)(vii) of this paragraph
(b) including without limitation thereto:
(aa) All appropriate and necessary general utility and
mechanical equipment occupied and non-occupied rooms and spaces;
(bb) The construction and installation of all
appropriate lines, pipes, mains, cables, manholes, wires, conduits and
other facilities required in connection with or relating to the mechanical,
utility, electrical, storm sewer, sanitary sewer, communications, security,
water, telephone, fire alarm, fire protection, gas and other systems
including all necessary relocations, and all work necessary or required to
tie the foregoing to the utility access stubs now existing or to be
constructed as part of the Redevelopment Work, including but not limited to
all necessary valves and other equipment and accessories necessary to the
use and operation of the heating, cooling, electrical, water,
communications and other utility systems serving or which are to serve the
Redevelopment Work or other Airport facilities;
(cc) To the extent permitted by KIAC, all work
necessary or required to construct lateral mains to tie into the Central
Terminal Area ring supply lines for hot water for heating and domestic use
purposes only and chilled water for air conditioning purposes only, in
accordance with the requirements and specifications as set forth in Section
39 hereof entitled "Hot Water and Chilled Water Requirements", provided,
however, if KIAC does not so permit such work to be performed by the
Lessee, such work shall be performed by KIAC or KIAC's contractors, as
determined by KIAC, which costs and expense shall be a part of the Cost of
the Lessee's Redevelopment Work Elements. The work specified in this
paragraph (b)(2)(viii)(cc) shall become a part of the TDS at the Airport
and will become the property of the Port Authority or its designee and none
of the foregoing work shall become a part of the Premises; and
(dd) The complete demolition and removal of the
structures located on the Redevelopment Work Sites as shown in grey shading
on the exhibit attached hereto, hereby made a part hereof and marked
"Exhibit 2.9", and all other demolition and removal associated with the
Redevelopment Work including, without limitation, the removal of all
underground tanks and their appurtenances, pipes, lines, fixtures and other
related equipment associated with Building No. 296 or exposed during the
performance of the Redevelopment Work and the removal and disposal of all
contaminated soil associated with any such tanks which the DEC requires be
removed or remediated in connection with the closure of any such tanks
(which tank and soil removal and disposal except for the Fuel Line Work is
herein referred to as "Tank Removal Work"), and all other demolition and
removal associated with the Redevelopment Work, all of the foregoing to be
performed in accordance with applicable law, including without limitation
all applicable Environmental Requirements, and to include without
limitation all appropriate, required or necessary removal of all below
ground asbestos which is damaged or interferes with the performance of the
Redevelopment Work and all above
15
ground asbestos, lead, petroleum products and other Hazardous Substances
and the handling, transporting and off-Airport disposal thereof (including,
if required, disposal of asbestos in an off-Airport long-term asbestos-only
disposal facility), provided, however, that the costs of the performance of
the Tank Removal Work shall be paid for as provided in paragraph (g)(12) of
this Section and in Section 87 and provided, further, however, without
limiting any other term or condition hereof the Tank Removal Work shall
additionally be performed in accordance with the terms and conditions of
subparagraph (30) of paragraph (g) of this section.
(ee) In addition to any other excavation and removal
and disposal of soil which is appropriate or necessary in connection with
the performance of the Redevelopment Work, the excavation and removal and
disposal off the Airport in accordance with all of the terms and conditions
of this Lease, including without limitation this Section 2 and all
applicable Environmental Requirements, at a location that has been approved
by the Port Authority, of all soil required to be removed from the
Redevelopment Work Sites by the Remedial Action Work Plan.
(ix) All other appropriate or necessary work in connection
with the foregoing clauses (i) through (viii) of this paragraph (b)(2),
including without limitation thereto, all borings, surveys, route marker signs,
obstruction lights and material inspections and testing and also including all
other tie-ins, temporary and otherwise, to utility lines and roadway access
stubs and other temporary work necessary to maintain airport operations.
(3) The Lessee agrees that all Project Costs and the performance
of the design and construction of the work described in paragraph (b)(2) of this
Section and any other work which the Lessee includes in its comprehensive plan
and which is consented to by the Port Authority shall be at the Lessee's sole
cost and expense without any reimbursement from the Port Authority except as set
forth in paragraph (g)(12) of this Section and in Section 87 hereof and shall be
subject to and performed in accordance with all the terms, provisions and
conditions of this Lease. Further, without limiting any other term or provision
of this Lease, all of the design and construction of the work described in
paragraph (b)(2) of this Section, except for the Parking Garage Work, shall also
be in conformance with the Terminal 5 Redevelopment Basis of Design and the
Parking Garage Work shall be designed and constructed by the Lessee in
accordance with the Parking Garage Basis of Design and all of the foregoing and
any other work which the Lessee includes in its comprehensive plan and which is
consented to by the Port Authority shall be designed and constructed in
accordance with the design criteria as contained in the Port Authority Tenant
Construction Review Manual and in the Port Authority Aviation Department Tenant
Alteration Procedures and Standards Guide as the same may be amended from time
to time (such design and construction of the work described in paragraph (b)(2)
of this Section and any other work which the Lessee includes in its
comprehensive plan and which is consented to by the Port Authority being
sometimes hereinafter collectively referred to as the "Redevelopment Work"). The
Lessee agrees to perform the Redevelopment Work in accordance with all of the
terms and conditions of this Lease.
(4) The Lessee, its contractors, subcontractors, suppliers of
materials and furnishers of services shall have access to the Redevelopment Work
Sites which are not
16
located on the Premises and the Satellite Portion of the Distribution Portion of
the System at all reasonable times subject however to the terms and conditions
of paragraph (g)(29) of this Section and subject and pursuant to and in
accordance with the Port Authority's right of entry as to other tenant areas,
and such other areas immediately adjacent thereto under the control of the Port
Authority as necessary to perform the construction obligations set forth in
subparagraph (2) of this paragraph (b). The exercise of such right of access
shall at all times be done in a lawful manner and in accordance with the rules
and regulations of the Port Authority.
(5) Temporary Facilities:
(i) The "Temporary Facilities Work" shall mean and consist
of the work set forth in the following items (aa) through (ee) and all necessary
and appropriate work in connection therewith as follows:
(aa) The design and construction of a new temporary
remote gate concourse of approximately 24,000 square feet with seven (7)
boarding gates in the area shown in stippled crosshatching on the exhibit
attached hereto, hereby made a part hereof and marked "Exhibit 2.10"
(herein called "Exhibit 2.10");
(bb) The design and construction of an at grade busing
route connecting the temporary remote gate concourse with Terminal 6;
(cc) The design and construction of utilities solely to
serve the Temporary Facilities Work,
(dd) The demolition and removal of all of the Temporary
Facilities Work, including without limitation, the temporary remote gate
concourse, the ramp bus route, all conveyers and equipment installed
exterior to the temporary remote gate concourse for baggage handling
purposes and utilities serving the temporary remote gate concourse, which
demolition and removal shall be completed within one hundred eighty (180)
days after DBO; and
(ee) All other work in connection with the foregoing
and which is consented to by the Port Authority.
(ii) The performance of the Temporary Facilities Work, and
the Temporary Facilities and the use and operation thereof, shall not adversely
affect the Redevelopment Work including without limitation the cost or schedule
thereof. Additionally, none of the costs for the Temporary Facilities Work shall
be included in the Cost of the Redevelopment Work, except for the amounts
actually paid or payable by the Lessee to independent third party contractors
for the purchase of the jet bridges and lounge furniture that are installed at
the New Passenger Terminal. None of the Temporary Facilities Cost shall be a
part of the Cost of the Redevelopment Work.
(iii) The Lessee agrees that the performance of the
Temporary Facilities Work described in this paragraph (b)(5) shall be at the
Lessee's sole cost and expense
17
without any reimbursement from the Port Authority, shall be subject to and
performed in accordance with all the terms and provisions of this Lease and
shall be designed and constructed in accordance with the design criteria as
contained in the Port Authority Tenant Construction Review Manual and in the
Port Authority Aviation Department Tenant Alteration Procedures and Standards
Guide as the same may be amended from time to time (the Redevelopment Work and
such design and construction of the Temporary Terminal Work being sometimes
hereinafter collectively referred to as the "Construction Work").
(c) Memorandum of Agreement Requirements:
(1) The Lessee shall participate in all meetings with the
Redevelopment Advisory Committee ("RAC"), as defined in the MOA, in connection
with the Construction Work and the obligations of the Lessee set forth in
subparagraph (2) of this paragraph (c) and shall cooperate with the RAC and the
Port Authority and provide to the Port Authority a response to suggestions and
recommendations made by the RAC or any members thereof in connection with the
foregoing. Further, Port Authority approval of the Lessee's plans and
specifications shall not occur prior to all determinations having been made by
the Port Authority as to all of the matters covered by subparagraph (2) of this
paragraph (c).
(2) The Lessee shall comply with all of the terms and conditions
of the MOA which pertain or relate to the Construction Work (the "Terminal 5 MOA
Requirements") including without limitation the following requirements in the
MOA, such compliance to include without limitation preparing and submitting
associated studies, analyses and documentation in a prompt and timely manner and
as required by the MOA and the RAC:
(i) The Lessee shall cooperate fully with the formation and
operation of the Redevelopment Advisory Committee;
(ii) The Lessee shall comply with all of the requirements of
Stipulations 3, 9, 10, 13 and 14 of the MOA;
(iii) The Lessee shall comply with all of the requirements
of Stipulations 4 and 12 of the MOA with respect to the Redevelopment Work;
(iv) The Lessee shall comply with all of the requirements of
Stipulation 5 of the MOA with respect to the West Tube as defined in the MOA;
(v) The Lessee shall comply with all of the requirements of
Stipulation 15 of the MOA with respect to the removal of the south baggage
facility; and
(vi) The Lessee shall comply with all of the requirements of
guideline 4(b), 4(c), 4(e), 4(f) and 4(g) of Attachment D of the MOA.
(3) All of the costs paid for or incurred by the Lessee to comply
with this paragraph (c) shall be assigned to the appropriate Element of Work.
18
(4) Neither this Lease nor anything contained herein shall impose
or be deemed to have imposed any obligations whatsoever on the Port Authority
with respect to the MOA except as set forth in Section 87 hereof with respect to
the MOA Flight Wing II Work, the MOA Curtain Wall Work and the Building No. 60
AirTrain Connector Work.
(5) No delay in the performance of the Construction Work arising
from or in connection with the RAC or the MOA shall relieve the Lessee from any
of the obligations under this Lease.
(d) Changes to Contract Documents:
(1) Definitions:
The following terms, when used in this Agreement shall,
unless the context shall require otherwise, have the respective meanings given
below:
(i) "Authorized Change Order" shall mean an Immaterial
Change Order, a Material Change Order and a Port Authority Requested Change
Order.
(ii) "Change Order" shall mean any amendment, supplement or
other change to any of the Contract Documents.
(iii) "Immaterial Change" shall mean a Proposed Change that
is not a Material Change.
(iv) "Immaterial Change Order" shall mean a Change Order
that is not a Material Change Order that was submitted to the Port Authority
prior to execution thereof by the Lessee.
(v) "Lessee Change Order" shall mean any Change Order that
is not a Port Authority Requested Change Order.
(vi) "Lessee Proposed Change" shall mean a Proposed Change
that is not a Port Authority Requested Change.
(vii) "Material Change" shall mean a Proposed Change that:
(aa) increases or reduces the scope of, or the design
intent of, the Redevelopment Work as described in the Terminal 5
Redevelopment Basis of Design, the Parking Garage Basis of Design, the
Design Development Documents or the Redevelopment Work Construction
Applications;
(bb) changes one or more Port Authority approved
Contract Documents which (x) results in the issuance of a new or revised
drawing by the Architect or Engineer of Record and (y) the Resident
Engineer of the Port Authority
19
determines that such Proposed Change requires submission to the Port
Authority for approval;
(cc) adversely affects the Redevelopment Work so that
it will not deliver the same level of service, quality, functionality,
useful life, efficiency or cost and ease of maintenance as the
Redevelopment Work specified in the Terminal 5 Redevelopment Basis of
Design, the Parking Garage Basis of Design, the Design Development
Documents or the Redevelopment Work Construction Applications; or
(dd) impacts any construction other than the
Redevelopment Work, or any activity other than the activities permitted
under this Lease, or any portion of the Airport outside of the
Redevelopment Work Site; or
(ee) impacts the Redevelopment Work Project Schedule.
(viii) "Material Change Order" means a Material Change that
has been approved by the Port Authority.
(ix) "Port Authority Requested Change" shall mean a Proposed
Change requested by the Port Authority for purposes that include but are not
limited to operation and maintenance considerations, good practice, operational
requirements, and any further conditions which may be imposed by the General
Manager of the Airport, provided, however, any change (x) that is in response to
unforeseen conditions discovered in the area of work during construction that
requires adjustment or modification of the installation or construction to
accommodate the design intent or (y) that shall be required in order for the
Redevelopment Work to be performed and completed in compliance with all of the
terms and conditions of this Lease, including without limitation, those set
forth in paragraph (f) of this Section, shall not be a Port Authority Requested
Change notwithstanding such amendment, supplement or change is requested by the
Port Authority.
(vi) "Port Authority Requested Change Order" shall mean each
Port Authority Requested Change that has been approved by the Port Authority.
(vii) "Proposed Change" shall mean a proposed amendment,
supplement or other change to any of the Contract Documents.
(2) Lessee Proposed Changes:
Upon request by the Port Authority, the Lessee shall provide
to the Port Authority the written documentation described in paragraph
(e)(3)(iv) of this Section. In the event of any dispute as to whether a Lessee
Proposed Change is a Material Change, such dispute shall be referred to and
determined by the Chief Engineer of the Port Authority. The Port Authority shall
advise the Lessee in writing if a Lessee Proposed Change is a Material Change.
(3) Material Changes:
20
All Material Changes shall be subject to the prior written
approval of the Port Authority and the Lessee shall not authorize or permit any
Redevelopment Work Contractor to perform any work in connection with any
Material Change unless such prior approval of the Port Authority is obtained. If
the Lessee desires to make a Material Change, it shall request the approval of
the Port Authority and shall provide the Port Authority with a written statement
setting forth in detail the scope, impact on the level of service, quality,
functionality, useful life, efficiency and cost and ease of maintenance of the
Redevelopment Work and the Lessee's good faith cost estimate for each Material
Change for labor, materials and equipment and such other Cost Categories as may
be applicable (including without limitation, design and construction and the
costs of any changes in related work) and savings, if any, in the Cost of the
Redevelopment Work which would result from such Material Change and the impact
of the Material Change (either positive or negative), cumulatively with all
prior Change Orders on (A) the Cost of the Redevelopment Work (B) each Element
of Cost and (C) on the scheduled completion date for each Element of Work. Upon
the approval by the Port Authority of a Material Change, the Lessee may enter
into the Material Change and proceed with the work covered by such Material
Change.
(4) Port Authority Requested Changes:
(i) The Lessee shall provide the Port Authority with a
written statement within ten (10) Business Days after the Lessee's receipt of a
Port Authority Requested Change setting forth in detail the Lessee's good faith
cost estimate for such Port Authority Requested Change for labor, materials and
equipment and such other Cost Categories as may be applicable (including without
limitation design and construction and the costs of any changes in related work)
and savings, if any, in the Cost of the Redevelopment Work which would result
from such Port Authority Requested Change and the impact of the Port Authority
Requested Change (either positive or negative), cumulatively with all prior
Authorized Change Orders on (A) the Cost of the Redevelopment Work (B) each
Element of Cost and (C) on the scheduled completion date for each Element of
Work.
(ii) The Lessee shall design and make such changes or
modifications in the Redevelopment Work in accordance with each Port Authority
Requested Change Order, which changes and modifications will become a part of
the applicable Redevelopment Work Construction Application and the Redevelopment
Work.
(iii) The Lessee shall not authorize or permit any
Redevelopment Work Contractor to perform any work in connection with any Port
Authority Requested Change unless the Port Authority has approved such Port
Authority Requested Change.
(iv) The Lessee will use commercially reasonable efforts to
provide the Port Authority with an estimate for each Port Authority Requested
Change in the lowest lump sum amount. In the event that such lump sum amount is
not satisfactory to the Port Authority, the Port Authority will have the option
to have the Lessee proceed with the Port Authority Requested Change on a time
and materials basis not to exceed without prior approval of an agreed upon
maximum cost.
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(v) The Port Authority shall pay the Lessee for the cost of
all Port Authority Requested Change Orders in accordance with Section 87 of this
Agreement, provided, however, if the work, materials or equipment covered by a
Port Authority Requested Change is part of the Element Budget for the Cost of
the Lessee's Redevelopment Work Elements, then only the incremental cost of such
Port Authority Requested Change Order shall be included in any Cost of the Port
Authority Requested Change Order and in the Cost of the Port Authority
Redevelopment Work Elements and the remainder of the amounts paid or payable
under such Port Authority Requested Change Order shall be included in the Cost
of the Lessee's Redevelopment Work Elements.
(5) The Cost of the Redevelopment Work shall not include any
costs related to a Change Order for a Material Change that is not a Material
Change Order.
(e) Project Management:
(1) Prior to or promptly after the execution of this Agreement,
the Lessee shall submit a project management plan to the Port Authority for its
approval. Such plan shall describe in detail the organizational structure of the
Lessee's project team, including roles and responsibilities of all members, the
proposed plan for the procurement of design and construction services, the
proposed procedures and software to be used to provide cost control and
management of schedules and budgets, the administrative procedures for record
keeping and document control. The Lessee shall comply with such project
management plan as the same shall have been approved by the Port Authority.
(2) The Lessee shall be responsible for developing all
Redevelopment Work Contracts and Documents and for the coordination among all
design and construction Redevelopment Work Contracts and Documents. The
Redevelopment Work Contracts and Documents shall provide separate construction
cost estimates for each Element of Work as more fully described in paragraph (g)
hereof and shall provide construction schedules that coordinate all the Elements
of Work.
(3) Project Cost Plan, Budget and Reporting:
(i) The detailed Stage 2 construction trade cost estimates
for each Element of Work as shown in the exhibit attached hereto, hereby made a
part hereof and marked "Exhibit 2.11" (herein referred to as "Exhibit 2.11")
have been translated into cost budgets for each Element of Work in accordance
with the schedule of various cost categories comprising "construction costs" and
"soft costs" as set forth in the exhibit attached hereto, make a part hereof and
hereby marked "Exhibit 2.12" (herein referred to as "Exhibit 2.12") (each a
"Cost Category"). The term "Element Budget" shall mean with respect to each
Element of Work the sum of all of the Cost Categories for such Element of Work
as set forth in the exhibit attached hereto, make a part hereof and hereby
marked "Exhibit 2.13" (herein referred to as "Exhibit 2.13") and "Project
Budget" shall mean an amount equal to the sum of all Element Budgets.
22
(ii) The Lessee shall provide monthly reports and updates of
each Cost Category in the Element Budget for each Element of Work. The reports
shall include the original budget for each Cost Category set forth in Exhibit
2.12, approved budget transfers, current budget, actual costs incurred to date,
Port Authority Payments made with respect to the cost category, variances from
comparing actual costs to budgeted, and the estimated cost by Cost Category and
total thereof at completion for each Element of Work. Actual costs and forecasts
will include relevant details of contract costs and reflect the latest updated
Redevelopment Work Project Schedule information so as to accurately reflect the
project cash flows.
(iii) The exhibit attached hereto, hereby made a part hereof
and marked "Exhibit 2.14" (herein referred to as the "Anticipated Monthly
Expenditure Schedule") indicates anticipated expenditures by month for each Cost
Category and for each Element of Work for the performance of all of the
Redevelopment Work. The Lessee will provide updates to the Anticipated Monthly
Expenditure Schedule for the duration of the Redevelopment Work.
(iv) The Lessee shall maintain, make available for Port
Authority inspection and continuously update a tabulation of all pending Change
Orders and Change Orders. The tabulation shall include the description,
estimated cost, final cost schedule adjustments and additional costs resulting
from such pending Change Orders and Change Orders. The Lessee shall maintain
such documentation for Proposed Changes, pending Change Orders and Change Orders
in sufficient detail for the Port Authority to determine if a Change Order
covers a Material Change, including, but not limited to, drawings, sketches,
costs estimates and specifications. The Lessee shall provide the Port Authority
with copies of the foregoing and such additional information and documentation
as the Port Authority may request from time to time.
(v) The Lessee shall notify the Port Authority in writing
when the actual cost for an Element of Work reaches 80% of the Element Budget
for such Element of Work together with an estimated cost at completion of such
Element of Work by each Cost Category constituting a part of such Element
Budget, taking into account without limitation executed Change Orders and
pending Change Orders, if any, and other commitments and exposures related to
such Element of Work.
(4) Project Schedules:
(i) The exhibit attached hereto, hereby made a part hereof
and marked "Exhibit 2.15" (herein referred to as "Exhibit 2.15") sets forth a
comprehensive baseline project master schedule for the Redevelopment Work
including schedule information for each Element of Work and showing the
interrelationships and interfaces between and among design activities, the work
to be performed under each of the construction contracts, connection to airport
utility services, key milestones and major tasks for each Element of Work
including their associated durations and dates of placing into use and
completion (which comprehensive schedule is herein called the "Initial
Redevelopment Work Project Schedule").
(ii) The Lessee shall promptly revise the Redevelopment Work
Project Schedule to incorporate all updates thereto reflecting individual
construction contract schedule information and shall promptly provide the Port
Authority with all such revisions
23
(which revised Initial Redevelopment Work Project Schedule as so revised from
time to time as approved by the Port Authority is herein called the
"Redevelopment Work Project Schedule").
(iii) Additionally, the Lessee shall administer, revise and
provide updates on the progress of the Redevelopment Work in comparison to the
Redevelopment Work Project Schedule on a monthly basis. The initial
Redevelopment Work Project Schedule and all subsequent revisions and monthly
updates shall conform to standard industry practices for projects of similar
size including but not limited to critical path method format and a sufficient
level of detail to support milestone dates, and provide construction work
status. The schedule shall be provided in electronic primavera data base format
and printed format as may be requested by the Port Authority.
(iv) The Redevelopment Work Project Schedule shall reflect
that the existing Yellow Parking Lot including entry/exit plazas shall not be
closed before the pre-construction meeting for the Parking Garage Work is held
and that the Parking Garage Completion Date shall occur on or prior to the
earlier to occur of DBO or the Terminal Work Completion Date.
(5) Project Reports:
The Lessee shall provide the Port Authority a monthly
project management report in such form as shall be prescribed by the Port
Authority including an executive summary and describing project activities,
accomplishments, issues and concerns for the past month, and activities planned
for the next three months. Each report shall contain cost and schedule
information to reflect the progress and status of the Redevelopment Work. The
report shall identify and address any anticipated or potential problems, the
reason for any failure to meet targets, and proposals for correcting actual or
anticipated problems. The reports shall be provided to the Port Authority by the
20th day occurring after the last day of the calendar month covered by such
report.
(f) Plans and Specifications
(1) (i) Prior to the commencement of the Construction Work, the
Lessee shall submit to the Port Authority for the Port Authority's approval as
they are completed and with sufficient time to permit Port Authority staff to
review the submission to ensure that the Redevelopment Work Project Schedule is
complied with, complete plans and specifications for the Construction Work and
all required supporting information including, but not limited to, drawings,
reports, calculations and computer printouts of analysis therefor. Procedures
for submissions and reviews are described in the Port Authority Aviation
Department Tenant Alteration Procedures and Standards Guide.
(ii) In addition to the requirements set forth in
subparagraph (1)(i) of this paragraph (f), as they are completed and with
sufficient time to permit Port Authority staff to review the documents to ensure
that the Redevelopment Work Project Schedule for the Passenger Terminal Work,
Landside Civil Work, Airside Civil Work, MOA Curtain Wall Work, MOA Flight Wing
II Work, Parking Garage Work, Terminal 5 Airtrain
24
Connector Work and Temporary Facilities Work will be adhered to, the Lessee
shall submit to the Director of the Redevelopment of the Port Authority a
sufficient number of copies of the preliminary design development documents (60%
completed design) for each of the Elements of Work.
(iii) Further, in addition to the requirements set forth in
subparagraphs (1)(i) and (1)(ii) of this paragraph (f) for any work that is
performed on a design build basis, as they are completed and with sufficient
time to permit Port Authority staff to review the documents to ensure that
Redevelopment Work Project Schedule attached hereto will be adhered to, the
Lessee shall submit to the Director of Redevelopment of the Port Authority
Program fifteen (15) copies of the following drawings or documents:
(aa) preliminary concept development plans;
(bb) request for proposal and scope of work documents
including without limitation concept drawings and design criteria;
(cc) initial preliminary design documents which shall
be at a minimum 35% complete; and
(dd) preliminary design documents which shall be at a
minimum 60 -75% complete.
(2) Without limiting the generality of the foregoing, the
Construction Work as set forth in the Lessee's plans and specifications (all of
which shall be in such detail as may reasonably permit the Port Authority to
make a determination as to whether the requirements hereinafter referred to are
met) shall not:
(i) Be unsafe, unsound, hazardous or improper for the use
and occupancy for which it is designed, or
(ii) Not comply with the Port Authority's requirements for
harmony of external architecture of similar existing or future improvements at
the Airport, or
(iii) Not comply with the Port Authority's requirements with
respect to external and interior building materials and finishes of similar
existing or future improvements at the Airport, or
(iv) Not provide for sufficient clearances for taxiways,
runways and apron areas, or be designed for use for purposes other than those
authorized under this Agreement, or set forth ground elevations or heights other
than those prescribed by the Port Authority, or
(v) Be designed for use for purposes other than those
authorized under the Agreement, or
25
(vi) Set forth ground elevations or heights other than those
prescribed by the Port Authority, or
(vii) Not provide adequate and proper roadways and
pedestrian circulation areas, or
(viii) Not comply with the building height limitations in
connection with sight line requirements between the existing control tower and
the Public Aircraft Facilities at the Airport, or
(ix) Not be at locations or not be oriented in accordance
with the Comprehensive Plan, or
(x) Not comply with the provisions of the Basic Lease,
including without limiting the generality thereof, the provisions of Section 18
of the Basic Lease providing that the Port Authority will conform to the
enactments, ordinances, resolutions and regulations of the City of New York and
its various departments, boards and bureaus in regard to the construction and
maintenance of buildings and structures and in regard to health and fire
protection which would be applicable if the Port Authority were a private
corporation to the extent that the Port Authority finds it practicable so to do,
or
(xi) Permit aircraft to overhang the boundary of the
Premises, except when entering or leaving the Premises, or
(xii) Be in violation or contravention of any other
provisions and terms of the Lease, or
(xiii) Not comply with all applicable governmental laws,
ordinances, enactments, resolutions, regulations, rules and orders, or
(xiv) Not comply with all applicable requirements of the
National Board of Fire Underwriters and the Fire Insurance Rating Organization
of New York, or
(xv) Not comply with the Port Authority's requirements with
respect to landscaping, or
(xvi) Not comply with the Port Authority's requirements and
standards with respect to noise, air pollution, water pollution or other types
of pollution, or
(xvii) Not comply with the construction limitations set
forth in any of the Exhibits, or
(xviii) Without limiting any other term or provision hereof,
not comply with the Americans With Disabilities Act of 1990 and all federal
rules, regulations and guidelines pertaining thereto, or
26
(xix) Not comply with the Port Authority's standard design
details, or
(xx) Not comply with the Port Authority's plans and policies
with respect to ground transportation, signing and traffic control and frontage
control within the Central Terminal Area of the Airport, or
(xxi) Not be coordinated in design, functional planning,
construction or scheduling or staging with other Port Authority or tenant
construction in the Central Terminal Area at the Airport or with the Lessee's
staging of the Construction Work hereunder or other ongoing Airport construction
projects and operations, including without limitation the operation of the
AirTrain, or
(xxii) Not provide appropriate or adequate access for KIAC
to its cogeneration facility and the Central Heating and Refrigeration Facility
for all types of vehicular, including oversized, deliveries, or
(xxiii) Not comply with the Terminal 5 Redevelopment Basis
of Design, or
(xxiv) Not comply with or meet the requirements of the MOA,
or
(xxv) Not comply with the project or construction scheduling
set forth in the Redevelopment Work Project Schedule, or
(xxvi) Not comply with the Redevelopment of Terminal5/6
FONSI/ROD, or
(xxvii) Not comply with the Parking Garage Basis of Design.
(3) The Lessee and the Port Authority shall establish a design
and redevelopment working group to review the development of the Redevelopment
Work and all drawings, specifications, calculations and reports and like items
prior to the submission of any drawings or plans to the Port Authority and
review the progress and conduct of the Redevelopment Work. The working group
shall meet on a regular basis in order that the Port Authority will generally be
informed of all areas of the design of the Redevelopment Work and be aware of
all construction approval dates. The meetings shall be informal to encourage a
full discussion of all appropriate issues and will not supersede the review or
approval process of the Comprehensive Plan, the Design Development Documents,
Tenant Construction or Alteration Applications and the contract documents as
described in this Section. The meetings shall continue until the Redevelopment
Work is completed.
(g) Performance of the Construction Work
27
All the Construction Work shall be done in accordance with the
following terms and conditions:
(1) (i) The Lessee hereby assumes the risk of loss or damage to
all of the Construction Work prior to the completion thereof and the risk of
loss or damage to all property of the Port Authority and others and the risk of
personal injury and death to all Persons arising out of or in connection with
the performance of the Construction Work including without limitation for all
Environmental Requirements and Environmental Damages, except as expressly set
forth in subparagraph (12) of this paragraph (g). In the event of such loss or
damage, the Lessee shall forthwith repair, replace and make good the
Construction Work and the property of the Port Authority as part of Project
Costs. The Lessee shall itself and shall also require its contractors to
indemnify and hold harmless the Port Authority, its Commissioners, officers,
agents and employees (each of the foregoing being hereinafter singularly
referred to as a "Construction Work Indemnified Party") from and against all
claims and demands, just or unjust, of third persons (including employees,
officers, and agents of the Port Authority) arising or alleged to arise out of
the performance of the Construction Work and for all expenses incurred by it and
by them in the defense, settlement or satisfaction thereof, including without
limitation thereto, claims and demands for death, for personal injury or for
property damage, direct or consequential, and whether they arise from the acts
or omissions of the Lessee, of any contractors of the Lessee, of the Port
Authority, or of third persons, or from acts of God or of the public enemy, or
otherwise excepting only claims and demands which result solely from affirmative
willful acts done by the Port Authority, all the foregoing to include without
limitation all claims and demands arising out of or in connection with any
Hazardous Substance and all claims of the City of New York against the Port
Authority pursuant to the provisions of the Basic Lease whereby the Port
Authority has agreed to indemnify the City against claims except claims and
demands of the City arising solely with respect to the Condition Exceptions
which the Lessee is not responsible for pursuant to paragraph (b)(2) of Section
56 hereof and claims and demands arising solely with respect to the terms and
conditions of the Remedial Action Work Plan which the Lessee is not responsible
for complying with pursuant this Lease, provided, however, that the Lessee shall
not be required to indemnify the Port Authority where indemnity would be
precluded pursuant to the provisions of Section 5-322.1 of the General
Obligations Law of the State of New York (each and every claim or demand for
which the Lessee has agreed to indemnify a Construction Work Indemnified Party
pursuant to this paragraph (g)(1)(i) being hereinafter called a "Construction
Work Indemnified Claim").
(ii) (aa) Except as set forth in subparagraph (g)(1)(ii)(bb)
of this Section, the Lessee shall at its own cost and expense defend each
and every suit based upon any Construction Work Indemnified Claim (even if
such claim or demand is groundless, false or fraudulent) with counsel
reasonably satisfactory to the Port Authority, and in defending such suit
the Lessee shall not, without obtaining express advance permission from the
General Counsel of the Port Authority, raise any defense involving in any
way the jurisdiction of the tribunal over the person of the Port Authority,
the immunity of the Port Authority, its Commissioners, officers, agents or
employees, the governmental nature of the Port Authority, or the provisions
of any statutes respecting suits against the Port Authority, provided,
however, the Port Authority shall have the right at its election to either
(x) participate in such defense or settlement with its own
28
counsel and at its sole expense except as set forth in subparagraph
(g)(1)(ii)(bb) of this Section, but the Lessee shall have the control of
the defense, judgment and settlement or (y) upon notice to the Lessee
relieve the Lessee from the obligation to defend any Construction Work
Indemnified Claim and itself defend such Construction Work Indemnified
Claim at its sole cost and expense except as set forth in subparagraph
(g)(1)(ii)(bb) of this Section and the settlement, judgment and
satisfaction thereof shall be paid by the Lessee if the Lessee has
consented to such settlement, judgment or satisfaction, which consent of
the Lessee will not be unreasonably withheld.
(bb) In the event that the defense of a Construction
Work Indemnified Claim which is to be provided by the Lessee (including
without limitation any defense provided by the Lessee's insurer, contractor
or subcontractor) has not been commenced within a reasonable time period
after receipt by the Lessee of notice of such Construction Work Indemnified
Claim, or if the Lessee, one of its contractors or subcontractors or its
insurer shall not use a counsel that is reasonably satisfactory to the Port
Authority in defending a Construction Work Indemnified Claim, then upon
notice to the Lessee the Port Authority may defend such Construction Work
Indemnified Claim at the sole cost and expense of the Lessee.
(cc) The Port Authority and the Lessee will reasonably
cooperate with each other in the defense of any Construction Work
Indemnified Claim.
(dd) In the event that the Lessee (including any of its
insurance carriers, contractors or subcontractors involved in the defense
of a Construction Work Indemnified Claim) has a conflict of interest with
the Port Authority or other Construction Work Indemnified Party or a
defense by the Lessee (including without limitation a defense by the
Lessee's insurer, contractor or subcontractor) adversely affects the
interests of the Port Authority or other Construction Work Indemnified
Party, then Lessee shall provide or cause to be provided separate counsel
approved by the Port Authority to defend such Construction Work Indemnified
Claim.
(2) (i) All the Redevelopment Work shall be done in accordance
with plans and specifications to be submitted to and approved by the Port
Authority prior to the commencement of the Redevelopment Work and until such
approval has been obtained the Lessee shall redo and resubmit such plans and
specifications until approval thereof by the Port Authority. Upon approval of
such plans and specifications by the Port Authority (such approved plans and
specifications as modified by an Authorized Change Order being herein sometimes
called the "Contract Documents"), the Lessee shall proceed diligently at its
sole cost and expense (except as provided in paragraph (g)(12) of this Section
and in Section 87 hereof) to perform the Redevelopment Work. All the
Redevelopment Work, including workmanship and materials, shall be of first class
quality. The Lessee shall redo, replace or construct at its own cost and expense
and without any reimbursement or payment by the Port Authority pursuant to
Section 87 hereof entitled "Port Authority Payments for the Cost of the
Redevelopment Work", any Redevelopment Work not done in accordance with the
approved plans and specifications, the terms, provisions and conditions of this
Lease or any further requirements of the Port Authority.
29
(ii) All the Temporary Facilities Work shall be done in
accordance with plans and specifications to be submitted to and approved by the
Port Authority prior to the commencement of the Temporary Facilities Work and
until such approval has been obtained the Lessee shall redo and resubmit such
plans and specifications until approval thereof by the Port Authority. Upon
approval of such plans and specifications by the Port Authority, the Lessee
shall proceed diligently at its sole cost and expense to perform the Temporary
Facilities Work. All the Temporary Facilities Work, including workmanship and
materials, shall be of first class quality. The Lessee shall redo, replace or
construct at its own cost and expense, any Temporary Facilities Work not done in
accordance with the approved plans and specifications, the terms, provisions and
conditions of this Lease or any further requirements of the Port Authority.
(3) (i) In addition to the requirements set forth in
subparagraphs (4) and (5) of this paragraph (g), the Lessee shall provide a list
of contracts and describe the scope of work for each contract it intends to
award for the performance of the Construction Work. Prior to entering into a
contract for any part of the Construction Work, the Lessee shall submit to the
Port Authority the names of the bidders for each contract and the name of the
contractor to whom the Lessee proposes to award said contract. The Port
Authority shall have the right to disapprove any contractor that may be
unacceptable to it. The Lessee shall include in all such contracts such
provisions and conditions as may be reasonably required by the Port Authority.
In addition, all contracts for the transportation and disposal of Shared Soil
shall be performed, billed and paid for on a per ton basis and shall further
include provisions covering the performance of transportation and disposal of
soil that is not Shared Soil pursuant to Port Authority Requested Change Order
at the same per ton costs as those for Shared Soil.
(ii) Without limiting the generality of the foregoing all of
the construction contracts for the Construction Work shall provide as follows:
"If (i) the Contractor fails to perform any of his obligations under the
Contract, including his obligation to the Lessee to pay any claims lawfully made
against him by any materialman, subcontractor or ▇▇▇▇▇▇▇ or other third person
which arises out of or in connection with the performance of the Contract or
(ii) any claim (just or unjust) which arises out of or in connection with the
Contract is made against the Lessee or (iii) any subcontractor under the
Contract fails to pay any claims lawfully made against him by any materialman,
subcontractor, ▇▇▇▇▇▇▇ or other third persons which arise out of or in
connection with the Contract or if in the Lessee's opinion any of the aforesaid
contingencies is likely to arise, then the Lessee shall have the right, in its
discretion, to withhold out of any payment (final or otherwise and even though
such payments have already been certified as due) such sums as the Lessee may
deem ample to protect it against delay or loss or to assume the payment of just
claims of third persons, and to apply such sums in such manner as the Lessee may
deem proper to secure such protection or satisfy such claims. All sums so
applied shall be deducted from the Contractor's compensation. Omission by the
Lessee to withhold out of any payment, final or otherwise, a sum for any of the
above contingencies, even though such contingency has occurred at the time of
such payment, shall not be deemed to indicate that the Lessee does not intend to
exercise its right with respect to such contingency. Neither the above
provisions for rights of the Lessee to withhold and apply monies nor any
exercise, or attempted exercise of, or omission to exercise such rights by the
Lessee shall create any obligation of any kind to such materialmen,
30
subcontractors, workmen or other third persons. Until actual payment is made to
the Contractor, his right to any amount to be paid under the Contract (even
though such amount has already been certified as due) shall be subordinate to
the rights of the Lessee under this provision."
(4) (i) Prior to engaging or retaining any Architect or Engineer
of Record for the Construction Work, the Lessee shall submit the name of each
such architect or engineer to the Port Authority for its approval. The Port
Authority shall have the right to disapprove any architect or engineer who may
be unacceptable to it. Additionally, prior to entering into any agreement with
any Architect or Engineer of Record, the Lessee shall submit such agreement to
the Port Authority for approval and the Port Authority shall have the right to
disapprove any such agreement within fifteen (15) Business Days after the
Lessee's submittal of such agreement to the Port Authority. No such agreement
shall be modified, supplemented or amended until the Lessee shall have submitted
such modification, supplement or amendment to the Port Authority for approval
and the Port Authority shall have the right to disapprove any such modification,
supplement or amendment within ten (10) Business Days after the Lessee's
submittal thereof to the Port Authority.
(ii) Prior to engaging or retaining a program manager to
monitor and supervise the Construction Work, the Lessee shall submit the name of
each such program manager to the Port Authority for its approval. Additionally,
prior to entering into any agreement with any program manager, the Lessee shall
submit such agreement to the Port Authority for approval and the Port Authority
shall have the right to disapprove any such agreement within fifteen (15)
Business Days after the Lessee's submittal of such agreement to the Port
Authority. No such agreement shall be modified, supplemented or amended until
the Lessee shall have submitted such modification, supplement or amendment to
the Port Authority for approval and the Port Authority shall have the right to
disapprove any such modification, supplement or amendment within 10 Business
Days after the Lessee's submittal thereof to the Port Authority.
(5) (i) The Lessee shall retain a construction manager to act as
the general contractor for the Construction Work. Prior to entering into a
contract with a construction manager for the Construction Work, the Lessee shall
submit to the Port Authority for its approval the name of each construction
manager. The Port Authority shall have the right to disapprove any construction
manager that may be unacceptable to it (each such construction manager that is
approved by the Port Authority being herein called a "General Contractor").
Additionally, prior to entering into any agreement with any General Contractor,
the Lessee shall submit such agreement to the Port Authority for approval and
the Port Authority shall have the right to disapprove any such agreement within
fifteen (15) Business Days after the Lessee's submittal of such agreement to the
Port Authority. No such agreement shall be modified, supplemented or amended
until the Lessee shall have submitted such modification, supplement or amendment
to the Port Authority for approval and the Port Authority shall have the right
to disapprove any such modification, supplement or amendment within ten (10)
Business Days after the Lessee's submittal thereof to the Port Authority.
(ii) At such times as the Lessee and the General Contractor
determine the identity of the proposed subcontractors and potential bidders for
the Construction Work, the Lessee shall submit to the Port Authority the names
of the proposed subcontractors and potential bidders and the portion of the
Construction Work which the Lessee anticipates will
31
be performed by such contractors, subcontractors and bidders. The Port Authority
may, within ten (10) business days of the submission of a list of the names of
such proposed subcontractors and bidders, comment thereon. The Lessee shall not
employ or approve any subcontractor or bidder to which the Port Authority has a
reasonable objection.
(iii) Each construction bid document, contract and other
construction document for the Redevelopment Work must comply with all of the
terms and conditions of this Section and of Section 87 hereof entitled "Port
Authority Payments for the Cost of the Redevelopment Work" and in addition to
the requirements set forth in this Section 2 and in Section 87 hereof, the
Lessee shall include in said construction documents, bid documents and contracts
such other terms, provisions and conditions as may be reasonably required by the
Port Authority prior to the execution thereof.
(iv) In addition to and without limiting any other right or
remedy of the Port Authority under this Lease or otherwise, the Port Authority
shall have the right to audit the books of any contractor (at any tier) with
respect to any contract covering the Construction Work, or any portion thereof
and each contract for the Construction Work shall so provide. In the event that
a Port Authority audit shall disclose that amounts paid by the Port Authority
exceed amounts incurred by the Lessee or the payments actually paid by the
Lessee for work actually performed and labor actually furnished and material and
equipment actually furnished and installed in connection with the performance of
the Redevelopment Work, the Lessee shall immediately pay to the Port Authority
an amount equal to the excess amount paid by the Port Authority.
(v) (aa) The Lessee shall provide on an ongoing basis, a
cost breakdown of all the Redevelopment Work separately detailing each of
the Elements of Work or any portion thereof, which separate detailed cost
breakdown shall be provided to the Port Authority. It is expressly
understood and agreed that in the event any proposed contract covers the
construction of more than one Element of Work, or any portion thereof, then
the cost breakdown shall contain an allocation of costs between each
Element of Work, or shall set forth a method for properly determining the
allocation of such costs, provided, however, that if such cost breakdown
does not properly allocate said costs or set forth a method for the
allocation of said costs the Port Authority shall determine the costs
thereof that are applicable to each individual Element of Work, or any
portion thereof.
(bb) No bid document and no contract for the Temporary
Facilities Work shall cover the performance of any of the Redevelopment
Work and no cost incurred for work performed under a contract covering the
Temporary Facilities Work shall be included in the Cost of the
Redevelopment Work.
(vi) It is further understood and agreed that the Port
Authority shall have as full a right to require the use of competitive bidding
and award, or other basis of
32
award, for the construction of the Redevelopment Work, or any portion thereof as
if such construction were to be performed by the Port Authority.
(vii) The Lessee shall file with the Port Authority two
copies of each of the contracts for the Redevelopment Work on the earlier of
within ten (10) days after the execution of such contract and prior to the start
of the portion of the Construction Work covered by such contract. Further, the
Lessee shall submit one copy of all approved shop drawings within 10 days after
approval thereof by the Architect or Engineer of Record for such drawings.
(6) (i) The Lessee shall or shall require its construction
manager, architect or engineer to furnish a full time resident engineer on site
at all times work is ongoing during the construction period and the Lessee shall
furnish a full time owner's representative authorized to act on behalf of the
Lessee for the Construction Work and shall be available on site at all times
work is ongoing during the construction period.
(ii) The Lessee shall require certification by a licensed
engineer of all controlled inspections and testing including, but not limited
to, pile driving data and all controlled concrete work and such other
certifications as may be requested by the Port Authority from time to time. The
Lessee shall submit all certifications and logs to the Port Authority's Resident
Engineer. Prior to the commencement of laboratory services the Lessee shall
submit to the Port Authority the names of all laboratories to be used for
testing and inspections. The Port Authority shall have the right to disapprove
any laboratory that may be unacceptable to it.
(7) The Lessee shall expend not less than Five Hundred Seventy
Million Dollars and No Cents ($570,000,000.00) with respect to the Redevelopment
Work and shall complete the Redevelopment Work by no later than day the
preceding the fifth (5th) anniversary of the Lease Commencement Date.
(8) The Lessee agrees to be solely responsible for any plans and
specifications used by it and for any loss or damages resulting from the use
thereof, notwithstanding the same have been approved by the Port Authority and
notwithstanding the incorporation therein of Port Authority recommendations or
requirements. Notwithstanding the requirement for approval by the Port Authority
of the contracts to be entered into by the Lessee or the incorporation therein
of Port Authority requirements or recommendations, and notwithstanding any
rights the Port Authority may have reserved to itself hereunder, the Port
Authority shall have no liabilities or obligations of any kind to any
contractors engaged by the Lessee or for any other matter in connection
therewith and the Lessee hereby releases and discharges the Port Authority, its
Commissioners, officers, representatives and employees of and from any and all
liability, claims for damages or losses of any kind, whether legal or equitable,
or from any action or cause of action arising or alleged to arise out of the
performance of any of the Construction Work pursuant to the contracts between
the Lessee and its contractors. Any warranties contained in any construction
contract entered into by the Lessee for the performance of the Construction Work
hereunder shall be for the benefit of the Port Authority as well as the Lessee,
and the contract shall so provide.
33
(9) The Port Authority shall have the right, through its duly
designated representatives, to inspect the Construction Work and the plans and
specifications thereof, at any and all reasonable times during the progress
thereof and from time to time, in its discretion, to take samples and perform
testing in any part of the Construction Work.
(10) The Lessee agrees that it shall deliver to the Port
Authority three (3) sets of "as built" drawings of the Construction Work in an
electronic CADD data file on a CD Rom in a format to be designated by the Port
Authority, all of which shall conform to the specifications of the Port
Authority (the receipt of a copy of said specifications prior to the Effective
Date being hereby acknowledged by the Lessee), and all engineering reports,
engineering analysis, boring logs, survey information and engineering design
calculations and operation and maintenance manuals in a comprehensive,
coordinated package. The Lessee shall, during the term of this Lease, keep said
digital electronic files of drawings and said electronic CADD data files current
showing thereon any changes or modifications which may be made and provide
copies thereof to the Port Authority as the Port Authority may request from time
to time. (No changes or modifications shall be made without prior Port Authority
consent).
(11) The Lessee shall, if requested by the Port Authority, take
all reasonable measures to prevent erosion of the soil and the blowing of sand
during the performance of the Construction Work, including but not limited to
the fencing of the Redevelopment Work Sites or portions thereof or other areas
and the covering of open areas with asphaltic emulsion or similar materials as
the Port Authority may direct.
(12) (i) The following terms, when used in this Agreement, shall,
unless the context shall require otherwise, have the respective meanings given
below:
(aa) "Eligible Below Ground Asbestos" shall mean only
that asbestos which meets all of the following criteria: It is (i) intact,
(ii) below-ground but not part of a below-ground structure and (iii)
contained within or around a utility line that has to be relocated or
removed as part of the Redevelopment Work, provided, however, no such
asbestos shall be Eligible Below Ground Asbestos unless the Lessee shall
have notified the Resident Engineer of the possible presence of such
eligible below ground asbestos and the Port Authority shall have inspected,
measured and documented the eligibility and quantity of the suspected
eligible below ground asbestos within two Business Days.
(bb) "Eligible Below Ground Asbestos Disposal Cost"
shall mean the amounts, and such amounts only, actually paid or payable by
the Lessee to independent third party contractors for the cutting,
wrapping, transporting and disposal off-Airport of Eligible Below Ground
Asbestos by a licensed asbestos contractor in accordance with this Lease,
including without limitation, all Environmental Requirements, but only to
the extent such amounts are included in Redevelopment Work Certificates as
defined in Section 87 hereof, and as such amounts may be adjusted pursuant
to the provisions of paragraphs (f) and (g) of Section 87 hereof.
34
(cc) "Free Product" shall mean the presence in ground
water of free phase petroleum hydrocarbons having a thickness of 0.01 feet
or greater.
(dd) "Incremental Dewatering Cost" shall mean the sum
of the following amounts, and such amounts only, actually paid or payable
by the Lessee (but only to the extent such amounts are included in
Redevelopment Work Certificates and as such amounts may be adjusted
pursuant to the provisions of paragraphs (f) and (g) of Section 87 hereof)
(it being understood and agreed that the cost of the transportation and
disposal of sediments from a Supplemental Treatment System if disposed of
as soil shall be Shared Soil and shall be included in the Incremental Soil
Disposal Costs and not in the Incremental Dewatering Cost):
(A) amounts actually paid or payable by the Lessee
to independent third party contractors on a per gallon basis for the
transportation and disposal in accordance with this Lease, including
without limitation, all Environmental Requirements, of liquid
sediments generated from the Lessee's Dewatering System in excess of
six cents ($0.06) per gallon, provided, however, in no event shall any
amounts which are not paid or payable on a per gallon basis be
includable as part of the Incremental Dewatering Cost, and, provided,
further, however, notwithstanding the foregoing "Incremental
Dewatering Cost" shall not include any amounts paid or payable to the
Lessee for the transportation and disposal of any liquid sediments
which contain any Lessee Hazardous Substances, and
(B) amounts actually paid or payable by the Lessee
to independent third party contractors for work actually performed,
labor actually furnished and materials and equipment actually
furnished for the purchase, installation and operation of the
Supplemental Treatment, if any, provided, however, notwithstanding the
foregoing "Incremental Dewatering Cost" shall not include any amounts
paid or payable to the Lessee for the purchase, installation and
operation of any Supplemental Treatment of volatile organics which are
a Lessee Hazardous Substance.
(ee) "Incremental Per Ton Cost of the Shared Soil
Disposal Work" shall mean for each ton of Shared Soil transported and
disposed of to a location off of the Airport in accordance with the terms
and conditions of this Lease, the amount that the Per Ton Cost of the
Shared Soil Disposal Work for such ton of Shared Soil exceeds the amount of
Twenty-two Dollars and No Cents ($22.00) per ton but does not exceed the
amount of Forty-two Dollars and No Cents ($42.00) per ton.
(ff) "Incremental Soil Disposal Costs" shall mean an
amount equal to the sum of the Incremental Per Ton Cost of the Shared Soil
Disposal Work for all tons of Shared Soil transported and disposed of off
of the Airport.
(gg) "Lessee's Dewatering System" shall mean the
treatment system which shall have been approved by the Port Authority and
is required to
35
satisfy all the requirements and conditions of the JFK SPDES Permit, with
the exception of volatile organics, as sampled from the final discharge
from such treatment system, and at a minimum said system shall include
settling tanks, provided, however, notwithstanding the foregoing, in the
event that the presence of any volatile organics is due to a Lessee's Act
or if the volatile organics are taken from or under the Premises and the
presence of such volatile organics on or under the Premises occurred after
the Effective Date and such Hazardous Substances were not added to or under
the Premises by the sole acts and omissions of the Port Authority, then the
"Lessee's Dewatering System" shall include the treatment system which shall
have been approved by the Port Authority and is required to satisfy the
requirements and conditions of the JFK SPDES Permit for such volatile
organics.
(hh) "Lessee's Eligible Below Ground Asbestos Disposal
Costs" shall mean an amount equal to 40% of the Eligible Below Ground
Asbestos Disposal Cost.
(ii) "Lessee's Incremental Dewatering Costs" shall mean
an amount equal to 40% of the Incremental Dewatering Cost.
(jj) "Lessee's Shared Environmental Costs" shall
collectively mean the Lessee's Soil Disposal Costs, the Lessee's
Incremental Dewatering Costs and the Lessee's Eligible Below Ground
Asbestos Disposal Costs.
(kk) "Lessee's Soil Disposal Costs" shall mean all
costs and expenses of the Lessee in performing the Redevelopment Work to
dispose of and transport soil off the Airport which costs and expenses are
not Port Authority Shared Soil Disposal Costs or Port Authority Non-Shared
Soil Disposal Costs.
(ll) "Per Ton Cost of the Shared Soil Disposal Work"
shall mean for each ton of Shared Soil that is transported and disposed of
off of the Airport the amounts, and such amounts only, actually paid or
payable by the Lessee to independent third party contractors on a per ton
basis for the transportation and disposal of each such ton of Shared Soil
but only to the extent such amounts are included in Redevelopment Work
Certificates as defined in Section 87 hereof and as such amounts may be
adjusted pursuant to the provisions of paragraphs (f) and (g) of Section 87
hereof.
(mm) "Port Authority Backfill Costs" shall mean the
amounts, and such amounts only, actually paid or payable by the Lessee to
independent third party contractors for the purchase, testing,
transportation and depositing of soil in the excavations from which Port
Authority Non-Shared Soil has been excavated but only to the extent such
backfill soil is not available from the performance of the Redevelopment
Work and further that such amounts are included in Redevelopment Work
Certificates as defined in Section 87 hereof and to the extent that such
purchase, testing, transportation and depositing of soil have been
performed pursuant to a Port Authority Requested Change Order, as such
amounts may be adjusted pursuant to the provisions of paragraphs (f) and
(g) of Section 87 hereof.
36
(nn) "Port Authority Eligible Below Ground Asbestos
Disposal Costs" shall mean an amount equal to 60% of the Eligible Below
Ground Asbestos Disposal Cost.
(oo) "Port Authority Incremental Dewatering Costs"
shall mean 60% of the Incremental Dewatering Cost and 100% of the
Supplemental Treatment Disposal Cost.
(pp) "Port Authority Non-Shared Soil" shall mean soils
that either (X) are classified as Hazardous Waste or (Y) meet all of the
following criteria: (i) they either are not excavated as part of the
Redevelopment Work or are excavated from the vicinity of a tank that is
removed as part of the Fuel Tank Work, (ii) they are not used at the
Redevelopment Work Site, (iii) they are excavated by the Lessee and
transported and delivered by the Lessee to an off Airport location approved
by the Port Authority pursuant to a Port Authority Requested Change Order,
(iv) the transportation and disposal thereof is performed and billed on a
per ton basis and at the best available price, and (v) the Lessee has
provided to the Port Authority the documentation required in subparagraph
(xii) of this paragraph (g)(12) for such soils, provided, however, "Port
Authority Non-Shared Soil" shall not include any soil which contains any
Lessee Hazardous Substance, and provided, further, however, soil shall not
be Port Authority Non-Shared Soil unless the Lessee shall have notified the
Resident Engineer of the possible presence of such Port Authority
Non-Shared Soil and the Port Authority shall have inspected, measured and
documented the eligibility and quantity of the suspected eligible Port
Authority Non-Shared Soil, and provided, further, however, notwithstanding
the foregoing, Port Authority Non-Shared Soil shall not include any soil
that requires excavation pursuant to subparagraph 7 of Section 3.1.1 of the
Remedial Action Work Plan or under the landside roadways.
(qq) "Port Authority Non-Shared Soil Disposal Costs"
shall mean the amounts, and such amounts only, actually paid or payable by
the Lessee to independent third party contractors for the excavation,
testing, transportation and disposal of Port Authority Non-Shared Soil but
only to the extent such amounts are included in Redevelopment Work
Certificates as defined in Section 87 hereof and only to the extent that
such excavation, testing, transportation and disposal Port Authority
Non-Shared Soil have been performed pursuant to a Port Authority Requested
Change Order, and further as such amounts may be adjusted pursuant to the
provisions of paragraphs (f) and (g) of Section 87 hereof.
(rr) "Port Authority Shared Soil Disposal Costs" shall
mean an amount equal to 60% of the Incremental Soil Disposal Costs and an
amount equal to 100% of the Per Ton Cost of the Shared Soil Disposal Work
in excess of $42.00 per ton.
(ss) "Port Authority Shared Soil" shall mean 50% of the
Shared Soil.
37
(tt) "Shared Soil" shall mean soil including, without
limitation, the sediment from the Lessee's Dewatering System that is
disposed of as soil, that meets all of the following criteria: (i) it is
excavated or removed as part of the Redevelopment Work, (ii) it is not used
or redeposited at the Redevelopment Work Site and (iii) it is transported
to and disposed by the Lessee at an off Airport location in accordance with
all of the terms and conditions of this Lease, including without limitation
all Environmental Requirements, (iv) the transportation and disposal
thereof is performed and billed on a per ton basis, (v) the Lessee has
provided to the Port Authority the documentation required in subparagraph
(xii) of this paragraph (g)(12) with respect to such soil, and (vi) it is
Hazardous Waste, provided, however, "Shared Soil" shall not include the
transportation and disposal of any soil or sediment which contains any
Lessee Hazardous Substances.
(uu) "Supplemental Treatment Disposal Cost" shall mean
the sum of the amounts, and such amounts only, actually paid or payable by
the Lessee to independent third party contractors for the transportation
and disposal in accordance with this Lease, including without limitation,
all Environmental Requirements, of Supplemental Treatment Waste, but only
to the extent such amounts are included in Redevelopment Work Certificates
as defined in Section 87 hereof, and as such amounts may be adjusted
pursuant to the provisions of paragraphs (f) and (g) of Section 87 hereof.
(vv) "Supplemental Treatment Waste" shall mean oil
impregnated absorbent pads and supernatant liquids generated from an oil
water separator and other wastes generated from the Supplemental Treatment,
provided, however, that "Supplemental Treatment Waste" shall not include
any oil impregnated absorbent pads, supernatant liquids and other wastes
generated from the Supplemental Treatment which contain any amount of
Lessee Hazardous Substances.
(ww) "Supplemental Treatment" shall mean an oil water
separator and such additional equipment, additives or treatments that shall
have been approved by the Port Authority to enhance the performance of the
Lessee's Dewatering System, which enhancement is required solely to satisfy
the JFK SPDES Permit requirements for volatile organics tested according to
test procedures approved under 40 CFR Part 136 and which volatile organics
do not contain any Lessee Hazardous Substance, it being understood that the
Port Authority, in its sole discretion, reserves the right to limit the
expenses associated with said Supplemental Treatment through the Lessee's
implementation of such alternative treatment methods as the Port Authority
may require.
(xx) "Unknown Environmental Condition" shall mean any
soil or ground water found in, on or under the Premises, the Terminal 4
Parcel and the Terminal 6 Parcel during the period from the Lease
Commencement Date to the date that the last sample is taken as part of the
Initial Post Construction Work, both dates inclusive, that contains any
Hazardous Substance.
38
(ii) Without limiting the generality of any other term or
condition of this Lease, any soil, dirt, sand, asbestos, sediment or other
material on the Premises or the Airport removed or excavated by the Lessee
during the course of Construction Work (all such material being hereinafter
collectively called the "Removed Material") and not used or redeposited at the
Redevelopment Work Site in accordance with this Lease shall be delivered and
deposited in accordance with the terms and conditions of this Lease, including
without limitation this Section 2 and all applicable Environmental Requirements
(including, if required, disposal of asbestos in a long-term disposal facility),
to a location off the Airport which has been approved by the Port Authority and
all in a manner satisfactory to the Port Authority. The Lessee shall submit to
the Port Authority for its approval all manifests, bills of lading and all other
documentation covering any Removed Material.
(iii) In the event the Lessee shall cause or discover an
Unknown Environmental Condition during its performance of the Construction Work,
the Lessee shall immediately notify the Resident Engineer. If the Unknown
Environmental Condition is not part of the Existing Condition, the Lessee shall
comply with paragraph (g)(34) hereof. In the event that the Unknown
Environmental Condition is part of the Existing Condition, the Lessee shall
survey and record the location of such Unknown Environmental Condition in such
manner and to the extent as shall have been approved by the Port Authority. The
Lessee shall not proceed with any Construction Work in the area of an Unknown
Environmental Condition subsequent to the discovery thereof until such survey
and recording has been performed as approved by the Port Authority and the
results of such survey and recordation delivered to the Resident Engineer and
further until either all such Unknown Subsurface Contamination has been removed
to the satisfaction of the Port Authority or the Lessee shall have received
notice from the Port Authority that the Construction Work can recommence.
Thereafter the Construction Work shall be performed in accordance with any
requirements of the DEC or such other Governmental Authority with respect to
such Unknown Environmental Condition.
(iv) The Port Authority shall take title to the Port
Authority Shared Soil, 100% of the Port Authority Non-Shared Soil and all
Supplemental Treatment Waste and the entire proceeds, if any, of the sale or
other disposition of the Port Authority Shared Soil, the Port Authority
Non-Shared Soil and the Supplemental Treatment Waste shall belong to the Port
Authority. The Lessee shall take title to all of the Removed Material that is
not Port Authority Non-Shared Soil, Port Authority Shared Soil or Supplemental
Treatment Waste and the entire proceeds, if any, of the sale or other
disposition thereof shall belong to the Lessee. The Lessee shall submit to the
Port Authority for its completion all manifests, bills of lading and all other
documentation covering any Port Authority Shared Soil, Port Authority Non-Shared
Soil and Supplemental Treatment Waste.
(v) The following shall be paid for by the Port Authority to
the extent and as provided for in Section 87 hereof:
(aa) Port Authority Shared Soil Disposal Costs,
39
(bb) Port Authority Eligible Below Ground Asbestos
Disposal Costs,
(cc) Port Authority Non-Shared Soil Disposal Costs,
(dd) Port Authority Backfill Costs,
(ee) Port Authority Incremental Dewatering Costs, and
(ff) Supplemental Treatment Disposal Cost.
(vi) The Lessee's Shared Environmental Costs and all other
dewatering costs and expenses and costs and expenses for the excavation,
testing, transportation and disposal of Removed Material not set forth in
subparagraph (12)(v) of this paragraph (g) shall be paid for by the Lessee,
shall be a portion of the Cost of the Lessee's Redevelopment Work Elements,
included in the appropriate Element of Cost and included in the Port Authority's
Share of the Cost of the Lessee's Redevelopment Work Elements to the extent and
as provided for in Section 87 hereof.
(vii) Promptly upon final disposition of any Hazardous
Substance in the performance of the Construction Work, the Lessee shall submit
to the Port Authority a "Certification of Final Disposal" stating the type and
amount of material disposed, the method of disposal and the owner and location
of the disposal facility. The format of such certification shall follow the
requirements, if any, of governmental agencies having jurisdiction as if the
Port Authority were a private organization and the name of the Port Authority
shall not appear on any certificate or other document as a generator or owner of
such material except for Port Authority Shared Soil, Port Authority Non-Shared
Soil and Supplemental Treatment Waste.
(viii) In the event any Hazardous Substance is discovered in
the performance of the Construction Work, the Lessee in reporting such Hazardous
Substance shall direct such report to the attention of such individual at the
subject governmental authority as the General Manager of the Airport shall
require in order to assure consistency in the environmental management of the
Airport.
(ix) In the performance of the Construction Work, the Lessee
shall not exacerbate the environmental condition of the Premises, the Airport or
any natural resource, including without limitation, any ground water or aquifer,
provided, however, the handling and re-depositing of soil in accordance with
this Section 2, the Remedial Action Work Plan and the Soil Management Plan as
approved by the Port Authority shall not be or be deemed to be an exacerbation
of the environmental condition of the Premises or the Airport
(x) In the event of any inconsistency between the terms of
the Remedial Action Work Plan and the Soil Management Plan, the terms of the
Remedial Action Work Plan shall prevail and control and in the event of any
inconsistency between the terms and conditions of this Lease and the Soil
Management Plan, the terms and conditions of this Lease shall prevail and
control.
40
(xi) The Lessee shall excavate, test and dispose of off of
the Airport all soils which the Remedial Action Work Plan requires to be removed
from the Premises in connection with or related to the performance of the
Construction Work.
(xii) The Lessee shall submit to the Port Authority for its
approval all manifests and bills of lading covering any Removed Material and in
addition shall prepare and submit to the Port Authority for its approval all
documentation that the Port Authority is required to submit to the DEC pursuant
to the Remedial Action Work Plan with respect to any Removed Material and that
the Lessee is required to submit to the disposal site or the DEC with respect to
any Removed Material. Further, the Lessee shall provide weight tickets from a
certified scale for each truckload of Shared Soil and Port Authority Non-Shared
Soil and for each such ticket such further evidence and documentation as to the
weight of each truck with no load and all manifests, bills of lading and such
other documentation that shall evidence to the satisfaction of the Port
Authority the per gallon cost of the Supplemental Treatment Disposal Cost.
(13) The Lessee shall pay or cause to be paid all claims lawfully
made against it by its contractors, subcontractors, materialmen and workmen, and
all claims lawfully made against it by other third persons arising out of or in
connection with or because of the performance of the Construction Work, and
shall cause its contractors and subcontractors to pay all such claims lawfully
made against them, provided, however, that nothing herein contained shall be
construed to limit the right of the Lessee to contest any claim of a contractor,
subcontractor, materialman, ▇▇▇▇▇▇▇ and/or other Person and no such claim shall
be considered to be an obligation of the Lessee within the meaning of this
Section unless and until the same shall have been finally adjudicated. The
Lessee shall diligently seek to resolve any such claims and shall keep the Port
Authority fully informed of its actions with respect thereto. Nothing herein
contained shall be deemed to constitute consent to the creation of any liens or
claims against the Construction Work, the Premises, the Redevelopment Work Site
or any other area of the Airport nor to create any rights in said third persons
against the Port Authority.
(14) (i) The Lessee in its own name as insured and also including
the Port Authority, the City Insureds and the Construction Work Indemnified
Parties as additional insureds, including without limitation for both
premises-operations and products-completed operations, shall procure and
maintain Commercial General Liability Insurance, including but not limited to
broad form property damage liability, completed operations for a minimum of
three (3) years after the Completion Date, explosion, collapse and underground
property damages, bodily injury (including death) and independent contractors,
none of the foregoing to contain care, custody or control exclusions, in not
less than the minimum limit set forth below, and with a contractual liability
endorsement covering the obligations assumed by the Lessee pursuant to
subparagraphs (1) and (8) of this paragraph (g) and the obligations required of
the Lessee's contractors pursuant to subparagraph (1) of this paragraph (g), and
Commercial Automobile Liability Insurance covering owned, non-owned and hired
vehicles and automatically covering newly acquired vehicles in not less than the
minimum limit set forth below, and Environmental Impairment Liability Insurance
covering both gradual and sudden and accidental occurrences with a 1 year
extended reporting period and including the Port Authority
41
and the City of New York as insureds, as owners, and which shall be site
specific and include on-site and off-site clean-up and with a contractual
liability endorsement covering the obligations assumed by the Lessee pursuant to
Section 56 hereof entitled "Environmental Obligations and Section 61 hereof
entitled "Storage Tanks", and providing for coverage in the minimum limit set
forth below, and such other insurance as the Port Authority may require in
connection with the performance of the Construction Work. The Lessee may provide
such insurance by requiring each contractor engaged by it for the Construction
Work to procure and maintain such insurance including such contractual liability
endorsement, said insurance, whether procured by the Lessee or by a contractor
engaged by it as aforesaid, not to contain any care, custody or control
exclusions, and not to contain any exclusion for bodily injury to or sickness,
disease or death of any employee of the Lessee or of any of its contractors
which would conflict with or in any way impair coverage under the contractual
liability endorsement. In addition, the said policy or policies of insurance
shall also provide or contain an endorsement providing that the protections
afforded the Lessee thereunder with respect to any claim or action against the
Lessee by a third person shall pertain and apply with like effect with respect
to any claim or action against the Lessee by the Port Authority, and shall also
provide or contain an endorsement providing that the protections afforded the
Port Authority thereunder with respect to any claim or action against the Port
Authority by the Lessee shall be the same as the protections afforded the Lessee
thereunder with respect to any claim or action against the Lessee by a third
person as if the Port Authority were the named insured thereunder, but such
provision or endorsement shall not limit, vary or affect the protections
afforded the Port Authority thereunder as an additional insured. In addition,
each of the said policy or policies of insurance shall be endorsed to state they
are primary in relation to any insurance carried or maintained by the Port
Authority, including without limitation, any self-insurance, regardless of type.
All the foregoing insurance requirements shall be in addition to all policies of
insurance otherwise required by the Lease.
Minimum Limits
Commercial General Liability
Combined single limit per
occurrence for death, bodily injury
and property damage liability: $100,000,000.00
Commercial Automobile Liability
(covering owned, non-owned and hired vehicles)
Combined single limit per occurrence
or death, bodily injury and property
damage liability: $25,000,000.00
Environmental Impairment Liability
Combined single limit per claim
for death, bodily injury and property
damage liability for both gradual and
42
sudden and accidental occurrences and
both on-site and off-site cleanup: $10,000,000.00
(ii) Without limiting the provisions hereof, in the event
the Lessee maintains the foregoing insurance in limits greater than aforesaid,
the Port Authority shall be included therein as an additional insured to the
full extent of all such insurance in accordance with all the terms and
provisions hereof.
(iii) The Lessee shall also procure and maintain in effect,
or cause to be procured and maintained in effect, Workers' Compensation
Insurance and Employer's Liability Insurance in accordance with and as required
by law and including coverage for asbestos exposure.
(iv) The insurance required hereunder in this subparagraph
(14) shall be maintained in effect during the performance of the Construction
Work and a certified copy of each of the policies or a certificate or
certificates evidencing the existence thereof, or binders, shall be delivered to
the Port Authority at least fifteen (15) days prior to the commencement of the
Construction Work or any portion thereof. In the event any binder is delivered,
it shall be replaced within thirty (30) days by a certified copy of the policy
or a certificate. Each copy, certificate and binder delivered by the Lessee to
the Port Authority pursuant to the foregoing shall bear the endorsement of or be
accompanied by evidence of payment of the premium thereof and, also, contain a
valid provision or endorsement that the policy may not be canceled or terminated
without giving thirty (30) days' written advance notice thereof to the Port
Authority and the City of New York and that the policy may not be changed or
modified in any way that would affect the Port Authority or the City of New York
without giving thirty (30) days' written advance notice thereof to the Port
Authority and the City of New York. Each such copy and each such certificate
with respect to the insurance required under this subparagraph (14) shall
contain an additional endorsement providing that the insurance carrier shall
not, without obtaining express advance permission from the General Counsel of
the Port Authority, raise any defense involving in any way the jurisdiction of
the tribunal over the person of the Port Authority, the immunity of the Port
Authority, its Commissioners, officers, agents or employees, the governmental
nature of the Port Authority or the provisions of any statutes respecting suits
against the Port Authority. Any renewal policy or certificate shall be delivered
to the Port Authority prior to the expiration of each expiring policy. The
aforesaid policies of insurance shall be written by a company or companies
approved by the Port Authority, the Port Authority agreeing not to withhold its
approval unreasonably. If at any time any of the insurance policies shall be or
become unsatisfactory to the Port Authority as to form, substance or limits or
if any of the carriers issuing such policies shall be or become unsatisfactory
to the Port Authority, the Lessee shall promptly obtain a new and satisfactory
policy in replacement, the Port Authority agreeing not to act unreasonably
hereunder. If the Port Authority at any time so requests, a certified copy of
each of the policies shall be delivered to the Port Authority.
(15) (i) The Lessee shall procure and maintain Builder's Risk
(All Risk) Completed Value Insurance with a deductible of not more than One
Hundred Thousand Dollars and No Cents ($100,000.00) covering loss or damage
(including any loss or damage resulting from flood or earthquake) to the
Construction Work during the performance thereof
43
including material located both on and off the Redevelopment Work Site but not
attached to the realty in an amount equal to the full replacement cost. Such
insurance shall also provide for full replacement value of materials stored
off-site and for materials in transit. Such insurance shall be in compliance
with and subject to the applicable provisions of Section 11 of the Lease
entitled "Insurance" and shall name the Port Authority, the City Insureds and
the Lessee and its contractors and subcontractors as insureds as their interests
may appear, the Port Authority shall be included as the loss payee, and such
policy shall be endorsed to provide that losses shall be adjusted with and
payable to the Port Authority. The Port Authority shall make such proceeds
available to the Lessee for and applied strictly and solely to the payment of
the cost of the repair, replacement, rebuilding or other performance of the
Construction Work and any excess shall be retained by the Port Authority. The
Lessee may provide such insurance by requiring the general contractor engaged by
it for the Construction Work to procure and maintain such insurance. In the
event the Construction Work or any part thereof shall be damaged by any casualty
against which insurance is carried pursuant to this subparagaph (15)(i), the
Lessee shall promptly furnish to the Port Authority such information and data as
may be necessary to enable the Port Authority to adjust the loss. The policies
or certificates representing insurance covered by this subparagraph (15) shall
be delivered by the Lessee to the Port Authority at least fifteen (15) days
prior to the commencement of construction of the Construction Work or any
portion thereof, and each policy or certificate delivered shall bear the
endorsement of or be accompanied by evidence of payment of the premium thereof
and also contain a valid provision obligating the insurance company to furnish
the Port Authority and the City of New York thirty (30) days' advance notice of
the cancellation or termination of the insurance evidenced by said policy or
certificate and thirty days' advance notice of any change or modification of the
insurance evidenced by said policy or certificate that would in any way the
affect the Port Authority or the City of New York. Renewal policies or
certificates shall be delivered to the Port Authority at least ten (10) days
before the expiration of the insurance which such policies are to renew.
(ii) The insurance covered by this subparagraph (15) shall
be written by companies approved by the Port Authority, the Port Authority
covenanting and agreeing not to withhold its approval unreasonably. If at any
time any of the insurance policies shall be or become unsatisfactory to the Port
Authority as to the form or substance or if any of the carriers issuing such
policies shall be or become unsatisfactory to the Port Authority, the Lessee
shall promptly obtain a new and satisfactory policy in replacement, the Port
Authority covenanting and agreeing not to act unreasonably hereunder. If at any
time the Port Authority so requests, a certified copy of each of the said
policies shall be delivered to the Port Authority.
(16) The Lessee shall be under no obligation to reimburse the
Port Authority for expenses incurred by the Port Authority in connection with
its normal review and approval of the original plans and specifications
submitted by the Lessee pursuant to this Section. The Lessee however agrees to
pay to the Port Authority upon its demand the expenses incurred by the Port
Authority in connection with any additional review for approval of any changes,
modifications or revisions of the original plans and specifications which may be
proposed by the Lessee for the Port Authority's approval. The expenses of the
Port Authority for any such additional review and approval shall be computed on
the basis of direct payroll time expended in connection therewith plus 100%.
Wherever in this Lease reference is made to "direct payroll time", costs
computed thereunder shall include a pro-rata share of the cost to the
44
Port Authority of providing employee benefits, including, but not limited to,
pensions, hospitalization, medical and life insurance, vacations and holidays.
Such computations shall be in accordance with the Port Authority's accounting
principles as consistently applied.
(17) The Lessee shall prior to the commencement of construction
of the Construction Work and at all times during such construction submit to the
Port Authority all engineering studies and environmental test results with
respect to the Construction Work and samples of construction materials as may be
required at any time and from time to time by the Port Authority.
(18) The Lessee shall at the time of submitting its comprehensive
plan to the Port Authority as provided in paragraph (b) hereof submit to the
Port Authority its forecasts of the number of people who will be working at
various times during the Construction Period at the Premises, the expected
utility demands of the Premises, noise profiles and such other information as
the Port Authority may require. The Lessee shall continue to submit its latest
forecasts and such other information as may be required as aforesaid as the Port
Authority shall from time to time and at any time request. The Lessee shall
comply with Port Authority requirements for security of the construction site
and badging of all workers on the Redevelopment Work Site.
(19) The Lessee shall execute and submit for the Port Authority's
approval a Tenant Construction or Alteration Application or Applications in the
form prescribed by the Port Authority covering the Construction Work or portions
thereof prior to the performance of the Construction Work. The Lessee shall
comply with all the terms and provisions of the approved Tenant Construction or
Alteration Application. In the event of any inconsistency between the terms of
any Tenant Construction or Alteration Application and the terms of this Lease,
the terms of this Lease shall prevail and control. No approval nor anything
contained in any approval granted by the Port Authority in connection with the
Construction Work shall constitute a determination or indication by the Port
Authority that the Lessee has complied with the applicable governmental laws,
ordinances, enactments, resolutions, rules and orders, including but not limited
those of the City of New York, which may pertain to the work to be performed.
(20) Nothing contained in this Lease shall grant or be deemed to
grant any contractor, architect, engineer, supplier, subcontractor or any other
Person engaged by the Lessee or any of its contractors in the performance of any
part of the Construction Work any right of action or claim against the Port
Authority, its Commissioners, officers, agents and employees with respect to any
work any of them may do in connection with the Construction Work. Nothing
contained herein shall create or be deemed to create any relationship between
the Port Authority and any such contractor, architect, engineer, supplier,
subcontractor or any other Person engaged by the Lessee or any of its
contractors in the performance of any part of the Construction Work and the Port
Authority shall not be responsible to any of the foregoing for any payments due
or alleged to be due thereto for any work performed or materials purchased in
connection with the Construction Work.
45
(21) (i) Without limiting any other terms, provisions and
conditions of the Lease, the Lessee understands and agrees that it shall put
into effect prior to the commencement of any of the Construction Work an
affirmative action program and Minority Business Enterprise (MBE) program and
Women-owned Business Enterprise (WBE) program in accordance with the provisions
of Schedule E attached hereto and hereby made a part hereof (hereinafter
"Schedule E"); as used in Schedule E the term "Construction Work" shall apply to
the Construction Work as defined in this Section. The provisions of said
Schedule E shall be applicable to the Lessee's contractor or contractors and
subcontractors at any tier of construction as well as to the Lessee itself and
the Lessee shall include the provisions of said Schedule E within all of its
construction contracts so as to make said provisions and undertakings the direct
obligation of the construction contractor or contractors and subcontractors at
any tier of construction. The Lessee shall and shall require its said
contractor, contractors and subcontractors to furnish to the Port Authority such
data, including but not limited to compliance reports relating to the operation
and implementation of the affirmative action, MBE and WBE programs called for
hereunder as the Port Authority may request at any time and from time to time
regarding the affirmative action, MBE and WBE programs of the Lessee and its
contractor, contractors, and subcontractors at any tier of construction, and the
Lessee shall and shall also require that its contractor, contractors and
subcontractors at any tier of construction make and put into effect such
modifications and additions thereto as may be directed by the Port Authority
pursuant to the provisions hereof and said Schedule E to effectuate the goals of
affirmative action and MBE and WBE programs.
(ii) In addition to and without limiting any terms and
provisions of this Lease, the Lessee shall provide in its contracts and all
subcontracts covering the Construction Work or any portion thereof, that:
(aa) The contractor shall not discriminate against
employees or applicants for employment because of race, creed, color,
national origin, sex, age, disability or marital status, and shall
undertake or continue existing programs of affirmative action to ensure
that minority group persons are afforded equal employment opportunity
without discrimination. Such programs shall include, but not be limited to,
recruitment, employment, job assignment, promotion, upgrading, demotion,
transfer, layoff, termination, rates of pay or other forms of compensation,
and selections for training or retraining, including apprenticeships and
on-the-job training;
(bb) At the request of either the Port Authority or the
Lessee, the contractor shall request such employment agency, labor union,
or authorized representative of workers with which it has a collective
bargaining or other agreement or understanding and which is involved in the
performance of the contract with the Lessee to furnish a written statement
that such employment agency, labor union or representative shall not
discriminate because of race, creed, color, national origin, sex, age,
disability or marital status and that such union or representative will
cooperate in the implementation of the contractor's obligations hereunder;
(cc) The contractor will state, in all solicitations or
advertisements for employees placed by or on behalf of the contractor in
the performance
46
of the contract, that all qualified applicants will be afforded equal
employment opportunity without discrimination because of race, creed,
color, national origin, sex, age, disability or marital status;
(dd) The contractor will include the provisions of
subparagraphs (21)(aa) through (21)(cc) of this paragraph (g) in every
subcontract or purchase order in such a manner that such provisions will be
binding upon each subcontractor or vendor as to its work in connection with
the contract;
"Contractor" as used herein shall include each contractor
and subcontractor at any tier of construction.
(iii) The Lessee in the performance of the Construction Work
shall commit itself to and use good faith efforts to implement an extensive
program to utilize Local Business Enterprises in accordance with and as set
forth in the schedule attached hereto, hereby made a part hereof and marked
"Schedule F".
(22) The Lessee shall not commence construction of the
Construction Work unless and until it has met with the General Manager of the
Airport, and has given him at least 72 hours advance notice of its intention to
commence construction of the Construction Work. Scheduling of the Construction
Work shall be coordinated with the General Manager of the Airport or his duly
authorized representative.
(23) In connection with the performance of the Construction Work
the Lessee shall be responsible for identifying the location of all utilities
and shall prior to the commencement of any of the Construction Work coordinate
the Construction Work with the New York City and Long Island One Call toll free
information service (▇-▇▇▇-▇▇▇-▇▇▇▇) and ascertain the location of underground
utilities, if any, at the Redevelopment Work Sites and in the vicinity where any
of the Construction Work is to be performed. The Lessee shall provide the Port
Authority with the written evidence of such coordination.
(24) In the performance of the Construction Work the Lessee shall
not employ any contractor nor shall the Lessee or any of its contractors employ
any Persons or use or have any equipment or materials or allow any condition to
exist if any such shall or, in the opinion of the Port Authority, may cause or
be conducive to any labor troubles at the Airport which interfere, or in the
opinion of the Port Authority are likely to interfere with the operations of
others at the Airport or with the progress of other Construction Work thereat.
The determinations of the Port Authority shall be conclusive to the Lessee. Upon
notice from the Port Authority, the Lessee shall immediately remove such
contractor or withdraw or cause its contractors to withdraw from the Airport,
the Persons, equipment or materials specified in the notice and replace them
with unobjectionable contractors, Persons, equipment and materials and the
Lessee shall or shall cause its contractor to immediately rectify any condition
specified in the notice. In the event of failure by the Lessee or any of its
contractors to immediately comply with the requirements of this subparagraph
(whether or not such failure is due to the Lessee's fault), the Port Authority
shall have the right to suspend the Lessee's right to perform the Construction
Work without prior notice; when the labor troubles shall be so settled that such
interferences or
47
the danger thereof no longer exists, the Port Authority, by notice to the
Lessee, shall reinstate said right on all the same terms and conditions as
before the suspension. "Labor troubles" shall mean and include strikes,
boycotts, picketing, work-stoppages, slowdowns, complaints, disputes,
controversies or any other type of labor trouble, regardless of the employer of
the Person involved or their employment status, if any.
(25) Dewatering and Discharge Permits:
(i) Attached hereto, hereby made a part hereof and
identified as "Exhibit 2.16" is a copy of Long Island Well Permit No.
▇-▇▇▇▇-▇▇▇▇▇/00005 effective for the period April 23, 2001 through December 31,
2006 issued by the DEC to the Port Authority covering the installation and
operation of temporary dewatering systems associated with 11 specific contracts
for the Central Terminal Area redevelopment program at the Airport (which permit
is hereinafter called the "Long Island Well Permit"). The Lessee has requested
that it be permitted to conduct dewatering performed by it in connection with
the Construction Work (the "Construction Work Dewatering") to be performed by
the Lessee hereunder. The Port Authority hereby grants its permission for the
Lessee to perform the Construction Work Dewatering under and pursuant to the
Long Island Well Permit on the following terms and conditions provided that, and
only to the extent that, the DEC concurs and permits the Construction Work
Dewatering to be performed by the Lessee under and pursuant to the Long Island
Well Permit, provided, however, that the permission granted hereunder with
respect to any extension of or replacement or succeeding permit to the Long
Island Well Permit shall not be effective if the conduct of Construction Work
Dewatering thereunder by the Lessee would be a violation of such permit.
(ii) (aa) The Lessee shall comply with all the terms and
conditions of the Long Island Well Permit and with all additional
requirements of the DEC in connection with the Construction Work Dewatering
performed under and pursuant to the Long Island Well Permit and all other
regulations in connection with any dewatering a performed by the Lessee or
contractor(s) of the Lessee at the Airport.
(bb) In addition, it is recognized that the Lessee will
be discharging wastewater under and pursuant to the New York State
Pollution Discharge Elimination System Permit No. NY 0008109 (the "JFK
SPDES Permit"). The Lessee shall comply with all the terms and conditions
of the JFK SPDES Permit and with all additional requirements of the DEC in
connection with any discharge of wastewater performed by the Lessee as part
of the Construction Work and all other regulations in connection with any
such discharge performed by the Lessee or contractor(s) of the Lessee at
the Airport.
(iii) It is specifically understood and agreed that the
permission of the Port Authority granted hereunder will allow the Lessee solely
to ▇▇▇▇▇▇▇ under the Long Island Well Permit for the Construction Work only if
approved by the DEC, and additionally the performance of the Construction Work
Dewatering and the discharge of wastewater shall be subject to the following
additional conditions:
48
(aa) Construction Work Dewatering shall take place at a
rate of no more than 1.5 million gallons in any 24 hour period. The
cumulative pump capacity of all active pumps operating pursuant to the
Construction Work Dewatering shall not exceed 1000 gallons per minute for
the duration of the Long Island Well Permit.
(bb) Dewatering and discharges must be monitored and
reported separately for individual contracts that comprise the Construction
Work. Accordingly, separate monitoring systems shall be used to track
dewatering and discharge activities performed under each contract for the
Construction Work and at each Redevelopment Work Site. In addition,
quantities allocated for one portion of the work or for one Redevelopment
Work Site may be applied to any other portion of the Construction Work or
any other Redevelopment Work Site provided that the cumulative rate does
not exceed 1.5 million gallons in any 24 hour period.
(iv) The Lessee shall designate, by written notice to the
Port Authority given not later than five (5) days after the Lessee's execution
of this Lease, a duly authorized representative of the Lessee (the "Lessee
Environmental Representative") who shall be responsible for the Lessee's
compliance with the Long Island Well Permit and the JFK SPDES Permit. The Lessee
shall install any and all pretreatment items requested by DEC, the General
Manager of the Airport, any approved Tenant Construction or Alteration
Application and/or indicated by water quality sampling results. All effluent
must be processed through settling tanks to reduce Total Suspended Solids to
achieve the JFK SPDES Permit limits.
(v) Upon written notice to the Lessee by the Port Authority
which may be given at any time upon any indication of non-compliance or
potential non-compliance by the Lessee with the Long Island Well Permit or the
JFK SPDES Permit, the Lessee shall immediately retain, at its own expense, under
contract a qualified environmental consultant, independent of the Lessee's
construction contractor, which qualified environmental consultant shall be
subject to the approval of the Port Authority and which qualified environmental
consultant shall provide liaison with the Port Authority and shall have the
obligation to submit any and all reports, and any other requested information,
directly to the Port Authority and to oversee installation of the dewatering
▇▇▇▇▇ by a licensed driller, and to monitor contractor compliance with all
dewatering operations. The aforesaid Lessee Environmental Representative and/or
the qualified environmental consultant of the Lessee shall promptly notify the
Port Authority's Resident Engineer of the progress of scheduled activities,
including initiation of dewatering activities and shall provide weekly updates
(by facsimile) on the activities at each Redevelopment Work Site, including the
status of dewatering activities (e.g. volumes removed, condition of waters).
Anything to the contrary in the foregoing notwithstanding, the said
environmental consultant shall at all times be a contractor of the Lessee. The
Port Authority shall not be responsible for any act or omission or fault or
neglect of the said environmental consultant nor shall the Port Authority have
any liabilities or obligations of any kind to said environmental consultant or
any responsibility for any payments due or alleged to be due thereto.
(vi) In addition to and without limiting paragraph
(g)(25)(viii) below or any other term or provision of this Lease, the Lessee
shall be solely responsible for any
49
and all fines, penalties, assessments, or levies assessed due to deviation from
or violation of the Long Island Well Permit and the requirements and conditions
thereof or due to deviation from or violation of the JFK SPDES Permit or of the
Lessee's authorization to discharge stormwater in the performance of the
Construction Work during construction or of any other permit, plan,
authorization or permission mentioned herein. All design planning shall be in
conformance with the requirements and conditions of the Long Island Well Permit,
of the JFK SPDES Permit and applicable Environmental Requirements and of any
other permit, plan, authorization or permission mentioned herein. The Lessee is
responsible for complete compliance with the said Environmental Requirements.
(vii) In the event that the projected zone of influence of
planned dewatering system is found to extend into any area outside of any
Redevelopment Work Site, the Lessee shall notify the Port Authority by
submitting to the Port Authority's Resident Engineer the proposed dewatering
design for review and approval. This proposed plan shall include the
identification of potentially affected non-pile supported structures and
pavements which may be impacted by drawdown effects during dewatering
operations.
(viii) The Lessee agrees to assume all risks arising out of
its performance of the Construction Work Dewatering and discharging of
wastewater at any portion or area of the Redevelopment Work Site under the Long
Island Well Permit, the JFK SPDES Permit or of any other permit, plan,
authorization or permission mentioned herein and, without limiting the
generality of any other term or provision contained in this Agreement, the
Lessee shall indemnify, hold harmless and reimburse the Port Authority, its
Commissioners, officers, employees and representatives from and against (and
shall reimburse the Port Authority for the Port Authority's costs and expenses
including, without limitation, legal costs and expenses incurred in connection
with the defense of) all claims and demands, penalties, fines, liabilities
(including, without limitation, strict liability), settlements, attorney and
consultant fees, investigation and laboratory fees, cleanup and remediation
costs, court costs and litigation expenses, damages, judgments, losses, costs
and expenses, including, without limitation, claims for personal injury,
including death, property damage and natural resources damage, of whatsoever
kind or nature and whether known or unknown, contingent or otherwise, just or
unjust, groundless or foreseeable or otherwise arising or alleged to arise out
of, or any way related to the Lessee's performance of the Construction Work
Dewatering or any discharging at any portion of the Redevelopment Work Site or
the Airport or the use of the Long Island Well Permit or the JFK SPDES Permit by
the Lessee or of any other permit, plan, authorization or permission mentioned
herein. If so directed, the Lessee shall at its own expense defend any suit
based upon the foregoing, and in handling such it shall not, without obtaining
express advance permission from the General Counsel of the Port Authority, raise
any defense involving in any way the jurisdiction of the tribunal over the
person of the Port Authority, the immunity of the Port Authority, its
Commissioners, officers, agents or employees, the governmental nature of the
Port Authority or the provisions of any statutes respecting suits against the
Port Authority.
(ix) The Lessee must provide all information to the Port
Authority required to obtain DEC authorization for it to discharge under the
Long Island Well Permit. Without limiting the generality of the foregoing
sentence, the Lessee shall submit to the Port Authority's Resident Engineer all
information required by the Long Island Well Permit
50
prior to the performance of any Construction Work Dewatering, including without
limitation the information set forth in Special Condition No. 3 of the Long
Island Well Permit, at least 60 days prior to commencement of construction under
each individual contract covering Construction Work Dewatering and discharge.
(x) Monthly volume logs, water quality results, visual
inspection logs and photographs required by the Special Conditions of the Long
Island Well Permit covering each Redevelopment Work Site and each contract for
Construction Work Dewatering are to be submitted by the Lessee to the
Supervisor, Permits and Government Approvals of the Port Authority's
Environmental Engineering Division by the 5th day of the month following the
month in which the foregoing are recorded or obtained. The parameters to be
analyzed and reported will be specified by the DEC pursuant to the Special
Conditions of the Long Island Well Permit.
(xi) The permission granted pursuant to this subparagraph
(25) for the Lessee to perform dewatering pursuant to the Long Island Well
Permit and discharging pursuant to the JFK SPDES Permit, as aforesaid, and any
other related matter may be revoked by the Port Authority upon twenty-four (24)
hours' notice to the Lessee if the Lessee fails, within seven (7) days after
receipt by the Lessee of notice of default from the Port Authority identifying
the breach or breaches of this subparagraph (25), to cure any default of the
terms and conditions of this subparagraph (25) so identified.
(xii) Not later than ten (10) days after completion by the
Lessee of dewatering activities and receipt of any approvals by a Governmental
Authority, the Lessee shall perform and complete a closure of all ▇▇▇▇▇ in
conformance with DEC requirements. As part of the closure of these ▇▇▇▇▇, the
Lessee and its contractor (s) shall notify both the Port Authority and the DEC
of this action.
(xiii) Prior to the expiration of the Long Island Well
Permit, the Lessee shall, as part of General Construction Costs, obtain from the
DEC and maintain in effect its own permit for dewatering performed in connection
with the Construction Work (the "Lessee's Dewatering Permit"). The Lessee shall
comply with all the terms and conditions of the Lessee's Dewatering Permit and
with any and all additional requirements of the DEC and notwithstanding anything
in the Lessee's Dewatering Permit to the contrary, the use of the Lessee's
Dewatering Permit shall not violate or be the cause of the violation of any
existing and future dewatering or SPDES permits at the Airport. In the event
that the projected zone of influence of any planned dewatering system is found
to extend into any area outside of the Premises or the Redevelopment Work Sites,
the Lessee shall notify the Port Authority by submitting to the Residential
Engineer the proposed dewatering design for review and approval.
(xiv) The Lessee shall keep full documentation of all ground
water volumes treated, sampled and discharged, including without limitation all
documentation which the Port Authority is required to report to the DEC pursuant
to the Remedial Action Work Plan and shall provide all such documentation to the
Port Authority.
51
(xv) The Lessee shall design and implement suitable
appropriate engineering practices and controls for all dewatering activities in
the performance of the Construction Work to prevent contamination of the lower
aquifer.
(26) Without limiting the generality of any other term or
condition hereof, the performance of the Construction Work shall be in
accordance with the MOA and the Redevelopment of Terminal 5/6 FONSI/ROD,
including without limitation FAA AC 150/5370-10A Standards for specifying
construction of Airports" item P-156 and AC 150/5320-5B "Airport Drainage" and a
storm water pollution prevention plan which includes best management practices.
(27) The performance of the Construction Work shall be in
accordance with the Port Authority Tenant Construction Review Manual and the
Port Authority Aviation Department Tenant Alteration Procedures and Standards
Guide. In the event of any inconsistency between the terms of the Port Authority
Tenant Construction Review Manual or the Port Authority Aviation Department
Tenant Alteration Procedures and Standards Guide on one hand and the terms of
this Lease on the other hand, the terms of this Lease shall prevail and control.
(28) The Port Authority shall have no obligation to provide any
parking facilities or area to any workers performing any of the Construction
Work and the Lessee shall not provide parking to any of the construction workers
at the Redevelopment Work Sites or anywhere else at the Airport without the
prior written approval of the General Manager of the Airport. Further, the
Lessee shall as part of General Construction Costs provide bus or van
transportation for such workers between the Redevelopment Work Sites and the
area or areas on or off the Airport, if any, where the Lessee has provided
parking to such workers.
(29) The transportation of materials and equipment on the Airport
in connection with the performance of the Construction Work shall be conducted
only at the times and on the routes as shall be designated therefor from time to
time by the General Manager of the Airport. Further, access to the Public
Aircraft Facilities shall only be at such guard post or posts as shall be
designated from time to time by the General Manager of the Airport.
(30) In addition to all the other requirements set forth in this
Lease for the performance of the Construction Work, the Tank Removal Work shall
be performed in accordance with and subject to the following additional terms
and conditions.
(i) The Lessee shall schedule and coordinate the Tank
Removal Work with the Port Authority to insure that the Port Authority can
monitor the performance thereof. The Lessee shall perform all soil and ground
water sampling required by any Environmental Requirement, including without
limitation the Remedial Action Work Plan, or the DEC in connection with the
performance of the Tank Removal Work. No Tank Removal Work shall be commenced
unless the Lessee shall have given the General Manager of the Airport at least
72 hours notice of the date that the Tank Removal Work shall begin and of the
anticipated schedule for the performance of the Tank Removal Work. No Tank
Removal Work shall be performed during any period that an environmental
representative from the Port
52
Authority as designated by the General Manager of the Airport is not present at
the Premises to oversee and monitor the performance of the work.
(ii) The parties recognize that the Tank Removal Work will
require various submissions be made to the DEC including without limitation test
results of soil and groundwater impacted by any underground tank and
documentation and certifications relating to the tank and soil disposal. The
Lessee shall provide the Port Authority, its representatives, contractors and
designees access to the Premises to perform such sampling of the ground water
and soil in the tank excavation area as the Port Authority shall in its sole
discretion determine is required. The Lessee shall remove and dispose of all
contaminated soil which the
DEC requires be removed or remediated in connection with the closure of any
tanks as shall be required by the Port Authority pursuant to a Port Authority
Requested Change Order.
(iii) No tank and related soil excavation area shall be
backfilled without the prior written approval of the Port Authority. If any area
is backfilled, whether with or without the approval of the Port Authority, prior
to the removal of all of the soil that has been contaminated as a result of a
leak, spill or discharge from or in connection with a tank, no Redevelopment
Work shall be constructed over or on such area or in the vicinity thereof until
the Lessee shall have received notice from the Port Authority that no further
soil removal is required.
(iv) The Lessee shall provide and prepare such documentation
and certifications as shall be required by the approved Tenant Construction or
Alteration Applications covering the Tank Removal Work, such as but not limited
to, an underground storage tank closure assessment and closure report as
stipulated under 40 CFR Part 280, Subpart G, Section 280, a certificate of
disposal for each tank removed, a bill of lading or manifest for all soil
disposed of and required documentation in connection with the cleaning of each
tank that is removed from any Redevelopment Work Site and the Lessee's contracts
covering the Tank Removal Work shall so provide.
(v) The Port Authority shall have no liability to the Lessee
or any Tank Removal Work contractor for any delay in the performance of the
Construction Work resulting from or in connection with the Tank Removal Work,
including without limitation, any delay resulting from soil and ground water
testing to be performed by the Port Authority or any delay in back filling the
excavation resulting from the tank and related soil removal or any delay in
construction over or in the vicinity of a backfilled area as provided for in
subparagraph (30)(ii) of this paragraph (g).
(31) Prior to backfilling any excavations in which the
construction of utilities has been completed, the Lessee shall notify the
Resident Engineer that such excavations are ready to be backfilled. Such
excavations shall not be backfilled until the Port Authority shall have
documented and surveyed the line and grade of such utilities. Nothing in this
paragraph (31) shall relieve the Lessee from its obligation to provide as built
drawings in accordance with this Section of all completed construction.
(32) In the performance of the Construction Work, the Lessee
shall perform all soil handling in accordance with the Remedial Action Work Plan
and the Soil
53
Management Plan and shall promptly comply with, observe and execute all the
terms and conditions of Section 3 of the Remedial Action Work Plan. In addition,
the Construction Work shall be performed in compliance with all of the terms and
conditions of the Remedial Action Work Plan.
(33) As a part of the Construction Work the Lessee shall submit
to the Port Authority for its approval prior to the commencement of the
Construction Work a soil management plan setting forth in detail how all
handling, excavation, depositing, testing, screening, backfilling, removal,
storage, transportation, disposal and other handling of soil in the performance
of the Construction Work shall be managed and performed (such plan as approved
by the Port Authority is hereinafter called the "Soil Management Plan").
(34) Without limiting any of the other terms and conditions of
this Lease, including without limitation paragraph (m) of Section 9 and
paragraph (d)(1) of Section 56 hereof and in addition thereto, in the event that
any Hazardous Substances are spilled, released, discharged, disposed on the
Airport in the performance of the Construction Work or on the Premises after the
Effective Date and which Hazardous Substances were not caused by the sole acts
or omissions of the Port Authority, the Lessee shall immediately (i) notify the
Port Authority of such spill, release, discharge or disposal, (ii) excavate all
soil containing any such Hazardous Substances, (iii) pump and treat all ground
water containing such any Hazardous Substances, and (iv) delineate such spill,
release, discharge or disposal to the satisfaction of the Port Authority. Such
pumping and treatment shall continue until all such Hazardous Substances that
have been so spilled, released, discharged or disposed of have been removed.
Further, the Lessee shall perform such sampling, testing and analysis as shall
be necessary or required to fingerprint or otherwise identify such Hazardous
Substances from similar pre-existing Hazardous Substances. Additionally, no
Construction Work shall be or continued to be performed in the area of such
spill, release, discharge or disposal until all such Hazardous Substances have
been removed by the Lessee, except, however, in the event of contamination of
the ground water by any petroleum hydrocarbons, construction can commence,
continue or recommence, as the case may be, in the event that free phase
petroleum hydrocarbons have a thickness of less than 0.01 foot and the Lessee
shall have delineated such free phase to the satisfaction of the Port Authority,
provided, further, that the remedial action work plan that has been approved by
the DEC covering such spill, release, discharge or disposal shall permit such
free phase petroleum hydrocarbons to remain in the ground water during
construction and the Lessee shall subsequent to the completion of the
Construction Work and as soon as practicable pump and treat the remainder of
such free phase petroleum hydrocarbons from the ground water and the Lessee
shall have delineated such spill, release, discharge or disposal to the
satisfaction of the Port Authority.
(h) Provisional Approvals
The Lessee may wish to commence construction of portions of the
Redevelopment Work prior to the approval by the Port Authority of its complete
plans and specifications for the same as required in this Section and if the
Lessee does it shall submit a written request to the Port Authority setting
forth the work it proposes to then do. The Port Authority shall have full and
complete discretion as to whether or not to permit the Lessee to
54
proceed with said work. Further, the Lessee may wish to commence construction of
portions of the Temporary Facilities Work prior to the approval by the Port
Authority of its complete plans and specifications for the same as required in
this Section and if the Lessee does it shall submit a written request to the
Port Authority setting forth the work it proposes to then do. The Port Authority
shall have full and complete discretion as to whether or not to permit the
Lessee to proceed with said work. If the Port Authority has no objection to the
Lessee's proceeding with the work, it shall do so by writing a letter to the
Lessee to such effect. If the Lessee performs the work covered by said letter,
it agrees all such work shall be performed subject to and in accordance with all
of the provisions of the approval letter and subject to and in accordance with
the following terms and conditions:
(1) The performance by the Lessee of the work covered by any
request as aforesaid will be at its sole risk. Until the complete plans and
specifications for the Temporary Facilities Work have been approved by the Port
Authority or if the approval thereof calls for modifications or changes in the
work undertaken by the Lessee under any approval granted by the Port Authority
pursuant to this paragraph (h), the Lessee will, as directed by the Port
Authority, at its sole cost and expense, either restore the area affected to the
condition prior to the commencement of any such work or make such modifications
and changes in any such work as may be required by the Port Authority. Until the
complete plans and specifications for the Redevelopment Work have been approved
by the Port Authority or if the approval thereof calls for modifications or
changes in the work undertaken by the Lessee under any approval granted by the
Port Authority pursuant to this paragraph (h), the Lessee will, as directed by
the Port Authority, at its sole cost and expense either restore the area
affected to the condition prior to the commencement of any such work or make
such modifications and changes in any such work as may be required by the Port
Authority.
(2) Nothing contained in any approval hereunder shall constitute
a determination or indication by the Port Authority that the Lessee has complied
with the applicable governmental laws, ordinances, enactments, resolutions,
rules and orders, including but not limited to those of the City of New York,
which may pertain to the work to be performed.
(3) The approved work will be performed in accordance with and
subject to the terms, conditions, indemnities and provisions of the Lease
covering the Construction Work and with the terms, conditions, indemnities and
provisions of any Tenant Construction or Alteration Application which the Port
Authority may request the Lessee to submit even though such Tenant Construction
or Alteration Application may not have, at the time of the approval under this
paragraph (h), been approved by the Port Authority.
(4) No work under any such approval shall affect or limit the
obligations of the Lessee under all prior approvals with respect to its
construction of the Construction Work.
(5) The Lessee shall comply with all requirements, stipulations
and provisions as may be set forth in the letter of approval.
55
(6) In the event that the Lessee shall at any time during the
construction of any portion of the Construction Work under the approval granted
by the Port Authority pursuant to this paragraph (h) fail, in the opinion of the
General Manager of the Airport, to comply with all of the provisions of the
Lease with respect to such work, the Tenant Construction or Alteration
Application or the approval letter covering the same or be, in the opinion of
the said General Manager of the Airport, in breach of any of the provisions of
the Lease, the Tenant Construction or Alteration Application or the approval
letter covering the same, the Port Authority shall have the right, acting
through said General Manager of the Airport, to cause the Lessee to cease all or
such part of the Construction Work as is being performed in violation of the
Lease, the Tenant Construction or Alteration Application or the approval letter.
Upon such written direction from the General Manager of the Airport the Lessee
shall promptly cease construction of the portion of the Construction Work
specified. The Lessee shall thereupon submit to the Port Authority for its
written approval the Lessee's proposal for making modifications, corrections or
changes in or to the Construction Work that has been or is to be performed so
that the same will comply with the provisions of this Lease, the Tenant
Construction or Alteration Application and the approval letter covering the
Construction Work. The Lessee shall not commence construction of the portion of
the Construction Work that has been halted until such written approval has been
received.
(7) It is hereby expressly understood and agreed that neither the
Resident Engineer nor the field engineer(s) mentioned in paragraph (i) below has
any authority to approve any plans and specifications of the Lessee with respect
to the Construction Work, to approve the construction by the Lessee of any
portion of the Construction Work or to agree to any variation by the Lessee from
compliance with the terms of the Lease, or the Tenant Construction or Alteration
Application or the approval letter with respect to the Construction Work.
Notwithstanding the foregoing, should the Resident Engineer or any field
engineer give any directions or approvals with respect to the Lessee's
performance of any portion of the Construction Work which are contrary to the
provisions of the Lease, the Tenant Construction or Alteration Application or
the approval letter, said directions or approvals shall not affect the
obligations of the Lessee as set forth herein nor release or relieve the Lessee
from strict compliance therewith.
(8) It is hereby further understood and agreed that the Port
Authority has no duty or obligation of any kind whatsoever to inspect or police
the performance of the Construction Work by the Lessee and the rights granted to
the Port Authority hereunder shall not create or be deemed to create such a duty
or obligation. Accordingly, the fact that the General Manager of the Airport has
not exercised the Port Authority's right to require the Lessee to cease its
construction of all or any part of the Construction Work shall not be or be
deemed to be an agreement or acknowledgment on the part of the Port Authority
that the Lessee has in fact performed such portion of the Construction Work in
accordance with the terms of the Lease, the Tenant Construction or Alteration
Application or the approval letter nor shall such fact be or be deemed to be a
waiver by the Port Authority from the requirement of strict compliance by the
Lessee with the provisions of the Lease, the Tenant Construction or Alteration
Application and the approval letter with respect to such work.
56
(9) Without limiting the discretion of the Port Authority
hereunder, the Port Authority hereby specifically advises the Lessee that even
if the Port Authority hereafter in the exercise of its discretion wishes to
grant approvals under this paragraph (h), it may be unable to do so, so as to
permit the Lessee to continue work without interruption following its completion
of the work covered by any prior approval hereunder. The Lessee hereby
acknowledges that if it commences work pursuant to this paragraph (h) it shall
do so with full knowledge that there may not be continuity by it in the
performance of its Construction Work under the procedures of this paragraph (h).
(10) No prior approval of any work in connection with the
Construction Work shall create or be deemed to create any obligation on the part
of the Port Authority to permit subsequent work to be performed in connection
therewith prior to the approval by the Port Authority of the Lessee's complete
plans and specifications therefor. It is understood that no such prior approval
shall release or relieve the Lessee from its obligation to submit complete plans
and specifications for the Construction Work and to obtain the Port Authority's
approval of the same as set forth in paragraph (f) hereof. It is further
understood that in the event the Lessee elects not to continue to seek further
approval letter(s) pursuant to this paragraph (h), the Port Authority shall have
the right to suspend the obligations of the Lessee to restore the area with
respect to the Construction Work and to make modifications and changes to the
Construction Work as set forth in subparagraph (1) of this paragraph (h) until
the Port Authority shall have approved the complete plans and specifications for
the Construction Work in accordance with paragraph (f) hereof.
(i) Commencement of Construction Work and Assignment of Port
Authority Field Engineer
The Lessee will give the General Manager of the Airport at least
72 hours advance notice prior to the commencement of construction. The Port
Authority will assign to the Construction Work a full time field engineer or
engineers during such time that any Construction Work is being performed
pursuant to paragraph (h) hereof and may assign to the Construction Work a full
time field engineer or engineers during any time that no Construction Work is
being performed pursuant to paragraph (h) hereof. The Lessee shall pay to the
Port Authority for the services of said engineer or engineers an amount equal to
the Cost of Port Authority Construction Inspection. The Lessee shall pay for the
Cost of Port Authority Construction Inspection by having such amount deducted
from the amount of the Port Authority Payments made to the Lessee by the Port
Authority pursuant to Section 87 hereof and as provided for in such Section 87.
Nothing contained herein shall affect any of the provisions of paragraph (n)
hereof or the rights of the Port Authority thereunder.
(j) Additional Environmental Obligations
(1) The Construction Work shall be constructed in such a manner
that there will be at all times a minimum of air pollution, water pollution or
any other type of pollution and a minimum of noise emanating from, arising out
of or resulting from the operation, use or maintenance of the Premises by the
Lessee and from the operations of the Lessee under this Agreement. Accordingly,
and in addition to all other obligations imposed on the Lessee
57
under this Agreement and without diminishing, limiting, modifying or affecting
any of the same, the Lessee shall be obligated to construct as part of the
Construction Work hereunder such structures, fences, equipment, devices and
other facilities as may be necessary or appropriate to accomplish the foregoing
and each of the foregoing shall be and become a part of the Construction Work
hereunder.
(2) Notwithstanding the provisions of subparagraph (1) of this
paragraph (j) and in addition thereto, the Port Authority hereby reserves the
right from time to time and at any time during the term of the Lease to require
the Lessee, subsequent to the completion of the Construction Work to design and
construct at its sole cost and expense on the Premises such further reasonable
structures, fences, equipment, devices and other facilities as maybe necessary
or appropriate to accomplish the objectives as set forth in the first sentence
of subparagraph (1) of this paragraph (j). All locations, the manner, type and
method of construction and the size of any of the foregoing shall be determined
by the Port Authority. The Lessee shall submit for Port Authority approval its
plans and specifications covering the required work and upon receiving such
approval shall proceed diligently to construct the same. All other provisions of
this Section with respect to the Construction Work shall apply and pertain with
like effect to any work which the Lessee is obligated to perform pursuant to
this paragraph (j) and upon completion of each portion of such work it shall be
and become a part of the Premises.
(k) Title to Construction Work
Title to all the Construction Work except for any Tanks shall
pass to the City as the same or any part thereof is erected, constructed or
installed. All of the Construction Work, except for the Terminal 5 AirTrain
Connector Work, any Tank and the work as set forth in paragraph (b)(2)(viii)(cc)
hereof, shall be and become a part of the Premises hereunder if located on the
Premises, it being understood that all personal property for which the Lessee
shall have received a Port Authority Payment for shall not be the personal
property of the Lessee but instead shall be the property of the Port Authority.
The foregoing provisions of this paragraph (k) shall not affect the risks and
obligations assumed by the Lessee hereunder nor release the Lessee from the
performance of its rebuilding and restoration obligations set forth in this
Section 2.
(l) Minimization of Disruption of and Coordination with Other Airport
Operations, Activities and Construction:
(1) The Lessee acknowledges that the Port Authority as well as
other users, lessees, tenants, airport patrons, contractors and invitees and
others will be continuing their operations in the Central Terminal Area during
the period of time the Lessee is performing the Construction Work hereunder and
that this will involve among other things inconvenience, noise, dust,
interference and disturbance to said operations and possibly other risks as
well. The Lessee further acknowledges that the Construction Work hereunder will
impact traffic flow and control on the roadways in the CTA as well as the
terminal frontage roads in front of the Premises and in front of Terminal 6 and
the use thereof by customers, patrons, invitees and employees. The Lessee hereby
expressly assumes all of the foregoing risks. Without limiting the foregoing,
the Lessee shall and expressly hereby agrees to perform, and to require each of
its contractors and subcontractors to perform, the Construction Work and each
portion thereof in
58
such a manner so as to minimize the impact and any disruption resulting
therefrom on said operations and on traffic control and traffic flow in the CTA
and on the operation and use of the AirTrain. The Lessee shall, without limiting
any other term or provision hereof, communicate and cooperate (and require each
of its contractors to communicate and cooperate) with the Port Authority and
with each of the users, lessees, tenants, airport patrons, invitees, contractors
and others in all aspects of the Construction Work, and the Lessee shall
coordinate and work in harmony with all said Persons, including without
limitation the users, occupants and operators of the Premises, Building No. 60,
the AirTrain, Terminal 4, Terminal 6, and Terminal 7 and Port Authority
contractors. The Lessee shall also communicate and cooperate (and require each
of its contractors to communicate and cooperate) with all ground transportation
operators and providers including all taxi, limousine and bus operators and the
AirTrain operator throughout the entire period of time of the performance of the
Construction Work. The Lessee shall include in each of its contracts and
subcontracts covering the Construction Work or any portion thereof the foregoing
requirements for minimization of disruption and for contractor cooperation,
communication and coordination.
(2) The Lessee acknowledges that the Construction Work may impact
on the fuel distribution system at the Airport as well as other utilities on or
adjoining the Airport and that the Construction Work may disrupt or interfere
with or interrupt the operation and performance of such utilities. The Lessee
hereby expressly assumes all of the risks from such disruption, interference and
interruption. Without limiting the foregoing, the Lessee shall and expressly
hereby agrees to perform, and to require each of its contractors and
subcontractors to perform, the Construction Work and each portion thereof in
such a manner so as to minimize the disruption, interference and interruption
resulting therefrom on said utilities. The Lessee shall, without limiting any
other term or provision hereof, determine which utilities may be affected by the
performance of the Construction Work and communicate and cooperate (and require
each of its contractors to communicate and cooperate) with the Port Authority
and with each of the users of such utilities in all aspects of the Construction
Work, and the Lessee shall coordinate and work in harmony with all said Persons.
The Lessee shall include in each of its contracts and subcontracts covering the
Construction Work or any portion thereof the foregoing requirements for
minimization of disruption, interference and interruption and for contractor
cooperation, communication and coordination.
(3) Without limiting any other term or provision hereof, the
Lessee shall complete the design and perform the Construction Work in a manner
consistent with roadway, frontage and utility improvements of the Port Authority
at the Airport and with the operation of the AirTrain.
(4) Temporary Construction Program: In order to ensure
appropriate levels of service to the users, occupants, and Airport patrons and
others using the Airport during the performance of the Construction Work, the
Lessee, not less than sixty (60) days prior to the commencement of any portion
of the Construction Work and the implementation of each construction stage,
shall prepare and submit to the Port Authority for its prior approval a
temporary construction program (including, but not limited to, drawings,
sketches, schedules and narrative descriptions) which sets forth plans for the
continuing provision of all patron services and landside operations at or
adjacent to the Redevelopment Work Site. Without limiting any
59
other term or provision hereof, any temporary construction is and shall be
subject to paragraph (n) of this Section, including, but not limited to,
certifications of the Lessee and the Lessee's licensed architect or engineer and
the issuance of a certificate of completion therefor by the Port Authority.
(m) Utility Lines
(1) The Port Authority shall have no responsibility for bringing
to the Premises or the Redevelopment Work Site any utility service lines for the
supply of cold water, or any other utility or service lines, except for the work
described in the exhibit attached hereto, hereby made a part hereof and marked
"Exhibit 2.17" (which work is herein called the "5kV Electrical Power and
Sanitary Sewer Work"). If the Lessee determines that it will require that
additional utility service lines be brought to the Redevelopment Work Site or
that the capacity of one or more of the existing utility service lines serving
the Redevelopment Work Sites be greater than the capacity which existed on the
Effective Date, except for the 5kV Electrical Power and Sanitary Sewer Work, the
Lessee shall submit to the Port Authority for the Port Authority's approval a
Tenant Construction or Alteration Application covering the work to provide the
additional utility service line capacity to the Redevelopment Work Sites
(hereinafter called the "Off-Premises Utility Service Line Work") which work
when and if approved by the Port Authority shall be performed by the Lessee at
the Lessee's sole cost and expense except as set forth in Section (g)(12) and
Section 87 hereof, in accordance with all the terms and provisions of this
Section, provided, however, that the Off-Premises Utility Service Line Work
shall not be or become a part of the Premises hereunder.
(2) The Lessee understands that there may be communications and
utility lines and conduits located on or under the Redevelopment Work Site which
do not, and may not in the future, serve the Redevelopment Work Site and are
located on or under the Redevelopment Work Site where the Construction Work is
or is to be performed or for which currently or in the future the operation,
maintenance, replacement, repair are or maybe affected by the Construction Work
or the performance thereof. The Lessee agrees, if directed by the Port Authority
so to do, to relocate and reinstall such communications and utility lines and
conduits on the Redevelopment Work Site or off the Redevelopment Work Site as
directed by the Port Authority and to restore all affected areas (such work
being hereinafter collectively called the "Relocation Work"). The Lessee shall
perform the Relocation Work subject to and in accordance with all the terms and
provisions of this Section and the Relocation Work shall be and become a part of
the Redevelopment Work, it being understood, however, that the Relocation Work
shall not be or become a part of the Premises hereunder.
(3) In the event KIAC does not permit the Lessee to relocate or
perform any other work in connection with the TDS (including without limitation
the lateral mains and heat exchangers) constituting a portion of the
Redevelopment Work, such relocation and other work shall be performed by KIAC or
KIAC's contractors, as determined by KIAC. Such work, upon completion, will
become a part of the TDS at the Airport and will become the property of the Port
Authority or of its designee and will not be a part of the Premises.
(n) Completion of the Construction Work:
60
(1) When the Temporary Facilities Work is substantially completed
and ready for use, the Lessee shall advise the Port Authority to such effect and
shall deliver to the Port Authority a certificate signed by an authorized
officer of the Lessee and also signed by the Lessee's licensed architect or
engineer certifying that the Temporary Facilities Work has been constructed in
accordance with the approved plans and specifications and the provisions of the
Lease and in compliance with all applicable laws, ordinances and governmental
rules, regulations and orders. Thereafter the Temporary Facilities Work will be
inspected by the Port Authority and if the same has been completed as certified
by the Lessee and the Lessee's licensed architect or engineer, as aforesaid, a
certificate to such effect shall be delivered to the Lessee, subject to the
condition that all risks thereafter with respect to the construction and
installation of the same and any liability therefor for negligence or other
reason shall be borne by the Lessee. The Lessee shall not use or permit the use
of the Temporary Facilities Work for the purposes set forth in paragraph (d) of
Section 5 of the Lease until such certificate is received from the Port
Authority, and the Lessee shall not use or permit the use of the Temporary
Facilities Work or any portion thereof even if such certificate is received if
the Port Authority states in any such certificate that the same cannot be used
until other specified portions are completed.
(2) (i) When all of the Passenger Terminal Work, the Landside
Civil Work, the Airside Civil Work, the MOA Curtain Wall Work, if any, and the
Terminal 5 AirTrain Connector Work (collectively the "Terminal Work") are
substantially completed and ready for use, the Lessee shall advise the Port
Authority to such effect and shall deliver to the Port Authority a certificate
signed by an authorized officer of the Lessee and also signed by the Lessee's
licensed architect or engineer certifying that the Terminal Work has been
constructed in accordance with the approved plans and specifications and the
provisions of the Lease and in compliance with all applicable laws, ordinances
and governmental rules, regulations and orders. Thereafter the Terminal Work
will be inspected by the Port Authority and if the same has been completed as
certified by the Lessee and the Lessee's licensed architect or engineer, as
aforesaid, a certificate to such effect shall be delivered to the Lessee,
subject to the condition that all risks thereafter with respect to the
construction and installation of the same and any liability therefor for
negligence or other reason shall be borne by the Lessee. The Lessee shall not
use or permit the use of the Terminal Work for the purposes set forth in the
Lease until such certificate is received from the Port Authority, and the Lessee
shall not use or permit the use of the Terminal Work or any portion thereof even
if such certificate is received if the Port Authority states in any such
certificate that the same cannot be used until other specified portions are
completed. The term "Terminal Work Completion Date" for the purposes of the
Lease shall mean the date appearing on the certificate issued by the Port
Authority pursuant to this subparagraph (2)(i) of this paragraph (n) after the
substantial completion of the Terminal Work.
(ii) In addition to and without affecting the obligations of
the Lessee under the preceding paragraph (n)(2)(i) of this Section when an
integral and material portion of the Terminal Work is substantially completed or
is properly usable the Lessee may advise the Port Authority to such effect and
may deliver to the Port Authority a certificate signed by an authorized officer
of the Lessee and also signed by the Lessee's licensed architect or engineer
certifying that such portion of the Terminal Work has been constructed in
accordance
61
with the approved plans and specifications and the provisions of the Lease and
in compliance with all applicable laws, ordinances and governmental rules,
regulations and orders, and specifying that such portion of the Terminal Work
can be properly used even though the Terminal Work has not been completed and
that the Lessee desires such use. The Port Authority may in its sole discretion
deliver a certificate to the Lessee with respect to each such portion of the
Terminal Work permitting the Lessee to use such portion thereof for the purposes
set forth in the Lease. In such event the Lessee may use such portion subject to
the condition that all risks thereafter with respect to the construction and
installation of the same and any liability therefor for negligence or other
reason shall be borne by the Lessee, and subject to the risks as set forth in
paragraph (h) hereof in the event that the Port Authority shall not have then
approved the complete plans and specifications for the Terminal Work. Moreover,
at any time prior to the issuance of the certificate required in subparagraph
(2)(i) of this paragraph (n) for the Terminal Work, the Lessee shall promptly
upon receipt of a written notice from the Port Authority cease its use of such
portion of the Terminal Work which it had been using pursuant to permission
granted in this paragraph (n)(2)(ii).
(3) (i) When the Parking Garage Work is substantially completed
and ready for use, the Lessee shall advise the Port Authority to such effect and
shall deliver to the Port Authority a certificate signed by an authorized
officer of the Lessee and also signed by the Lessee's licensed architect or
engineer certifying that the Parking Garage Work has been constructed in
accordance with the approved plans and specifications and the provisions of the
Lease and in compliance with all applicable laws, ordinances and governmental
rules, regulations and orders. Thereafter the Parking Garage Work will be
inspected by the Port Authority and if the same has been completed as certified
by the Lessee and the Lessee's licensed architect or engineer, as aforesaid, a
certificate to such effect shall be delivered to the Lessee, subject to the
condition that all risks thereafter with respect to the construction and
installation of the same and any liability therefor for negligence or other
reason shall be borne by the Lessee. The Lessee shall not use or permit the use
of the Parking Garage Work for the purposes set forth in the Lease until such
certificate is received from the Port Authority, and the Lessee shall not use or
permit the use of the Parking Garage Work or any portion thereof even if such
certificate is received if the Port Authority states in any such certificate
that the same cannot be used until other specified portions are completed. The
term "Parking Garage Work Completion Date" for the purposes of the Lease shall
mean the date appearing on the certificate issued by the Port Authority pursuant
to this paragraph (n)(3)(i) of this Section after the substantial completion of
the Parking Garage Work.
(ii) In addition to and without affecting the obligations of
the Lessee under the preceding paragraph (n)(3)(i), when an integral and
material portion of the Parking Garage Work is substantially completed or is
properly usable the Lessee may advise the Port Authority to such effect and may
deliver to the Port Authority a certificate signed by an authorized officer of
the Lessee and also signed by the Lessee's licensed architect or engineer
certifying that such portion of the Parking Garage Work has been constructed in
accordance with the approved plans and specifications and the provisions of the
Lease and in compliance with all applicable laws, ordinances and governmental
rules, regulations and orders, and specifying that such portion of the Parking
Garage Work can be properly used even though the Parking Garage Work has not
been completed and that the Lessee desires such use. The Port Authority may in
62
its sole discretion deliver a certificate to the Lessee with respect to each
such portion of the Parking Garage Work permitting the Lessee to use such
portion thereof for the purposes set forth in the Lease. In such event the
Lessee may use such portion subject to the condition that all risks thereafter
with respect to the construction and installation of the same and any liability
therefor for negligence or other reason shall be borne by the Lessee, and
subject to the risks as set forth in paragraph (h) hereof in the event that the
Port Authority shall not have then approved the complete plans and
specifications for the Parking Garage Work. Moreover, at any time prior to the
issuance of the certificate required in paragraph (n)(3)(i) of this Section for
the Parking Garage Work, the Lessee shall promptly upon receipt of a written
notice from the Port Authority cease its use of such portion of the Parking
Garage Work which it had been using pursuant to permission granted in this
paragraph (n)(3)(ii).
(4) The term "Completion Date" for the purposes of the Lease
shall mean the later to occur of the Parking Garage Work Completion Date and the
Terminal Work Completion Work Date, provided, however, and if the Parking Garage
Work Completion Date and the Terminal Work Completion Work Date shall be the
same date, then "Completion Date" shall mean such same date.
(5) At the same time that the Lessee shall deliver any
certificate pursuant to paragraph (n)(3) of this Section covering all or any
portion of the Parking Garage Work or the Terminal 5 AirTrain Connector Work the
Lessee shall deliver to the Port Authority all warranties, guarantees, manuals,
maintenance contracts and spare parts for or associated with such Parking Garage
Work or Terminal 5 AirTrain Connector Work The Lessee shall have assigned all
warranties, guarantees and maintenance contracts to the Port Authority in
accordance with paragraph (q) of this Section. All Port Authority Service
Contracts and other maintenance contracts and warranties and guarantees related
to such Parking Garage Work shall commence on the date of the first certificate
of the Port Authority issued pursuant to paragraph (n)(3) of this Section
covering that portion of the Parking Garage Work and all Port Authority Service
Contracts and other maintenance contracts and warranties and guarantees related
to such Terminal Work shall commence on the date of the first certificate of the
Port Authority issued pursuant in paragraph (n)(3) of this Section covering that
portion of the Terminal Work
(o) Fuel Line Work:
(1) The following terms when used in this paragraph (o) shall
have the respective meanings given below:
(i) "Abandoned Fuel Lines" shall mean any portion of the
System which is taken out of service as part of the Fuel Line Work and is
abandoned in place or is abandoned and removed from the Airport as a part of the
Fuel Line Work.
(ii) "Acceptance Date" shall mean with respect to each
portion of the Distribution Portion Work, the date appearing on the certificate
delivered to the Lessee by the Port Authority pursuant to subparagraph (3) of
this paragraph (o) covering such portion of the Distribution Portion Work and
shall mean with respect to each portion of the Satellite Portion
63
Work, the date appearing on the certificate delivered to the Lessee by the Port
Authority pursuant to subparagraph (3) of this paragraph (o) covering such
portion of the Satellite Portion Work.
(iii) "Airport Fueling Agreements" shall mean the General
Airport Agreement (also commonly known as the "▇▇▇▇▇ Leases") and any other
agreements covering aircraft fueling at the Airport which are contemplated by
the Airport Fueling Agreements, it being understood and agreed that the term
"Airport Fueling Agreements" shall continue to include the General Airport
Agreement upon the expiration thereof as the same may continue to be operative,
and shall also include the New Airport Fueling Agreements.
(iv) "Airline Terminal Portion" shall mean that portion of
the System that is located on the Premises, including without limitation all of
the Airline Terminal Portion of the Work and all of the Premises Distribution
Lines which are located on the Premises.
(v) "Airline Terminal Portion of the Work" shall mean all
portions of the Fuel Line Work performed and located on the Premises and the
Terminal 4 Parcel.
(vi) "Defect" shall have the meaning given such term in
subparagraph (2)(xi) of this paragraph.
(vii) "Distribution Portion Work" shall mean any of the Fuel
Line Work that is performed by the Lessee or on behalf of the Lessee to the
Distribution Portion of the System and such work is not performed on the
Premises or the Terminal 4 Parcel.
(viii) "Fuel Line Risks" shall mean any and all risks,
costs, expenses, damages, responsibilities and liabilities arising out of, in
connection with or resulting from the Fuel Line Work, the New System Components,
or the Abandoned Fuel Lines, including but not limited to, each Warranty, all
Defects, the failure to have, or the inclusion of (whether proper or improper),
any maintenance, repair, replacement, operation or other costs or expenses
incurred in connection with the Fuel Line Work, New System Components or the
Abandoned Lines included in the System Costs, or the failure or refusal of the
Users or any of them to pay any such costs or expenses, or the failure to obtain
the agreement or approval of the Other Users for the Fuel Line Work, including
without limitation the payment of the costs thereof and its design.
(ix) "Fuel Line Work" shall have the meaning set forth in
subparagraph (2) of this paragraph (o).
(x) "New Isolation Valve Pit" shall mean all of the new
associated pig indicator and receiver pits, isolation valves, and related
appurtenances to be constructed, provided and installed by the Lessee in
connection with the proposed location of the New Isolation Valve Pit as shown on
Exhibit 2.18, attached hereto, hereby made an part hereof and marked "Exhibit
2.18" (herein referred to as "Exhibit 2.18") with respect to Premises
Distribution Lines 402-1, 402-2, 402-3 as part of the Fuel Line Work.
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(xi) "New System Components" shall collectively mean all
improvements, facilities, structures, additions, installations and equipment
installed or constructed as part of the Fuel Line Work.
(xii) "Other Users" shall mean all Users except for the
Lessee.
(xiii) "Permitted Modification" shall mean a modification,
relocation, alteration, addition, replacement or capital improvement made to the
System by any Person, provided, however, that (i) the costs and expenses of such
modification, relocation, alteration, addition, replacement or capital
improvement are not includable or included in Systems Costs by reason that one
or more persons have agreed to pay for such costs and expenses (which person may
be one of the Users and if so such agreement to pay such costs and expenses has
not been made by such person pursuant to the Airport Fueling Agreements) or was
performed by or on behalf of the Port Authority and is not "An Additional
Facility Improvement" (as such term is defined in Section 4.021F of the General
Airport Agreement) and/or the Port Authority has not proposed to the Lessee or
the other Basic Aircraft Operators (as such term is used in Section 12.14 of the
General Airport Agreement) that such modification, relocation, alteration,
addition, replacement or capital improvement be made to the Distribution Portion
of the System pursuant to Section 4.021 K of the General Airport Agreement
and/or is any other work which is not included or includable in System Costs
pursuant to the General Airport Agreement or the New Airport Fueling Agreements
and (ii) such modification, relocation, alteration, addition, replacement or
capital improvement shall have been approved or performed by the Port Authority.
(xiv) "Premises Distribution Line" shall mean each of those
distribution fuel lines identified as Line 402-1, Line 402-2, Line 402-3 on
Exhibit 2.18 as such Lines recommence at the dike wall of the Satellite Portion
of the System and their related facilities and appurtenances.
(xv) "Re-designated Airline Terminal Portion of the System"
shall mean all portions of Premises Distribution Lines 402-1, 402-2, 402-3
existing prior to the commencement of the Fuel Line Work and which are located
on the Premises and the Terminal 4 Parcel.
(xvi) "Redesignation Date" shall mean with respect to each
Premises Distribution Line the date that the Lessee shall first commence any of
the Fuel Line Work with respect to such Premises Distribution Line.
(xvii) "Satellite Portion Work" shall mean that portion of
the Fuel Line Work, if any, that is performed at the Satellite Portion of the
System.
(xviii) "System" shall have the meaning given such term in
Section 4.021A of the General Airport Agreement.
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(xix) "System Costs" shall mean all costs and expenses
incurred in connection with the System, including without limitation capital,
operation, maintenance and repair costs and expenses, paid or to be paid for
collectively by the Users pursuant to the Airport Fueling Agreements (including
without limitation Sections 4.02 and 4.021 of the General Airport Agreement and
the New Airport Fueling Agreements).
(xx) "System License" shall mean the Major Petroleum
Facility License issued by the New York State Department of Environmental
Conservation bearing license number 2-2380.
(xxi) "System Operator" shall mean Allied New York Services,
Inc., the Port Authority's independent contractor presently operating the
System, or any other Person who shall operate, repair or maintain the System
pursuant to the General Airport Agreement.
(xxii) "Users" shall mean any Persons who use the System or
are obligated (whether by agreement or otherwise) to pay any System Costs.
(xxiii) "Warranty" shall have the meaning given such term in
subparagraph (2) (xi) of this paragraph (o).
(2) As part of the Lessee's Redevelopment Work, the Lessee has
advised the Port Authority that it desires to relocate, remove, replace and
abandon portions of the Distribution Portion of the System located on the
Premises as well as make certain replacements and modifications to the Satellite
Portion of the System and other portions of the Distribution Portion of the
System as shall be required, necessary or desirable for such relocation,
removal, replacement and abandonment (any work performed on the System and any
replacements and abandonment of the System to be performed by the Lessee as part
of the Construction Work as the same may be approved by the Port Authority being
herein referred to as the "Fuel Line Work", it being understood that the
maintenance, operation and repair of the Satellite Portion of the System shall
not be part of the Fuel Line Work). In addition to all the other terms and
conditions of this Lease, all Fuel Line Work performed by the Lessee shall be
performed subject to and in accordance the following additional terms and
conditions:
(i) None of the Fuel Line Work shall become part of System
Costs. The Lessee further agrees that if any costs and expenses for the repair,
operation, replacement, maintenance or use of the Distribution Portion Work, the
Satellite Portion Work for any reason whatsoever are not included or includable
in, or not allowed to become a part of, System Costs, that the Lessee shall bear
and pay for any and all such costs and expenses inclusive of the associated
costs for the proper handling and disposing of removed fuel and the removed fuel
lines which are taken out of the System and off the Airport by the Lessee as a
part of the Fuel Line Work.
(ii) The Fuel Line Work shall be performed in accordance
with all the terms and conditions of this Lease and of the General Airport
Agreement and the other Airport Fueling Agreements.
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(iii) In addition to and without limiting the obligations
set forth in paragraph (g) of this Section, any portion of the Fuel Line Work
performed by the System Operator shall be performed by the System Operator on
behalf of the Lessee. The Lessee shall assure that the costs and expenses of all
Fuel Line Work are separately allocated and billed to the Lessee by each of its
contractors, including without limitation, by the System Operator, and in no
event are any such costs and expenses to be allocated or billed as, or to become
a part of, System Costs. Further, the Lessee shall communicate and cooperate
(and require each of its contractors to communicate and cooperate) with the
System Operator in all aspects of the Fuel Line Work and shall coordinate the
performance of the Fuel Line Work with the System Operator. The Lessee shall
include in each of its contracts and subcontracts covering the Fuel Line Work or
any portion thereof the foregoing requirements for cooperation, communication,
coordination, allocation and billing.
(iv) In addition to and without limiting the obligations set
forth in paragraph (l) of this Section, the Lessee shall in the performance of
the Fuel Line Work and in fulfillment of its obligations pursuant to
subparagraph (xi) of this paragraph (o)(2) minimize to the greatest extent
possible any disruption, interruption, delay or interference in the operation,
performance, maintenance, repair or use of the System. To that end, prior to the
Lessee's commencement of the Fuel Line Work or any portion thereof, the Lessee
shall submit to the Port Authority for the Port Authority's approval a plan to
accomplish the foregoing and shall revise and update such plan as desirable or
required throughout the performance of the Fuel Line Work. Such plan shall
include without limitation the sequencing and scheduling of all shut downs of
any portion of the System such as but not limited to the sequencing and
scheduling of all work to tie-in any portion of the Fuel Line Work to the System
and flushing and testing the Fuel Line Work, and that no section of the
Satellite Portion Work shall be taken or kept out of service during peak travel
periods. Further, such plan shall include actions and procedures to be
undertaken and followed in the event of any unscheduled or unexpected shut down
or disruption of or interference with the operation or use of the of the System.
The Lessee understands and agrees that no approval of the Port Authority shall
relieve or release the Lessee from its obligations under this paragraph (o). The
Port Authority shall have the right from time to time to require the Lessee to
make changes to the plan and the Lessee shall comply therewith and with any and
all such required changes.
(v) All Fuel Line Work shall comply in all respects with the
System License and all other Environmental Requirements and the Lessee shall
take all actions to ensure such compliance. Further, if required or permitted by
the DEC or any other applicable Governmental Authority, the Lessee shall
register, license and/or permit the Airline Terminal Portion of the System in
accordance with Environmental Requirements in the name of the Lessee as the
owner thereof and in the name of the System Operator as the operator thereof.
(vi) Title to the Airline Terminal Portion of the Work shall
remain in the Lessee as the same or any part thereof is erected, constructed or
installed and upon such erection, construction or installation the same shall be
and become a part of the Airline Terminal Portion of the System for the purposes
of this Agreement and the Airport Fueling Agreements including without
limitation the Lessee assuming all risks, costs, expenses,
67
responsibilities and liabilities in connection therewith and the same shall be
and become a Tank (as such term is defined in Section 61 hereof entitled
"Storage Tanks") and all the terms and conditions of Section 61 shall apply
thereto.
(vii) Notwithstanding any terms or conditions in the Airport
Fueling Agreements to the contrary, effective as of the Redesignation Date with
respect to each Premises Distribution Line, that portion of such Premises
Distribution Line constituting a portion of the Re-designated Airline Terminal
Portion of the System shall be and become for the purposes of this Agreement and
of the Airport Fueling Agreements a part of the Airline Terminal Portion of the
System and a Tank and all the terms and conditions of Section 61 hereof shall
apply thereto. Without limiting the generality of any other term or provision of
this Agreement, from and after the Redesignation Date for such Re-designated
Airline Terminal Portion of the System shall no longer be or be deem to be a
part of the Distribution Portion of the System and the Lessee shall take title
to the same in its "as is" condition and shall release and relieve the Port
Authority and Other Users from and shall assume all risks, costs, expenses,
responsibilities and liabilities in connection with such Re-designated Airline
Terminal Portion of the System.
(viii) Title to all the Distribution Portion Work and the
Satellite Portion Work shall pass to the City of New York as the same or any
portion thereof is erected, constructed and installed and effective upon the
Acceptance Date of each portion of the Distribution Portion Work, such
Distribution Portion Work shall be and become for the purposes of this Agreement
and of the Airport Fueling Agreements a part of the Distribution Portion of the
System and effective upon the Acceptance Date of each portion of the Satellite
Portion Work, such Satellite Portion Work shall be and become for the purposes
of this Agreement and of the Airport Fueling Agreements a part of the Satellite
Portion of the System.
(ix) The Lessee shall take all actions to maintain and
protect all manufacturer, contractor and vendor warranties (express and implied)
of any New System Components.
(x) The Lessee hereby agrees as the lessee hereunder, and as
a User under the General Airport Agreement and, if as a party to any of the New
Airport Fueling Agreements, if it becomes such a party, that it shall not object
to, challenge or make any claim or demand (including without limitation one for
or concerning arbitration), whether under this Agreement or the Airport Fueling
Agreements or otherwise, with respect to, on account of or arising out of any
Permitted Modification, including without limitation, (aa) the failure of the
Port Authority to have entered into any written agreement with, or to have
obtained consents or approvals from, one or more Users in connection with any
Permitted Modification or (bb) the inclusion or the failure to be included in
the System Costs any maintenance, repair, replacement, operational or other
costs and expenses with respect to a Permitted Modification.
(xi) Notwithstanding any other term or provision of this
Agreement or any review by the Port Authority of the plans and specifications
for the Fuel Line Work or any comment of the Port Authority on or failure of the
Port Authority to comment on the design, performance or installation of the Fuel
Line Work, or any inspection or approval by the Port Authority or by the System
Operator of the Fuel Line Work, or any terms or conditions
68
of any Port Authority approval covering the Fuel Line Work, or the existence of
any patent or trade name, or any other facts or circumstances which could or
could be construed to affect or relieve the Lessee from its obligations under
this paragraph (o)(2)(xi), the Lessee unconditionally guarantees, warrants and
represents to the Port Authority and the Other Users that:
(aa) the Fuel Line Work shall be performed in
accordance with and subject to all the terms and conditions of this Agreement
and the General Airport Agreement as the same may be replaced by New Airport
Fueling Agreements,
(bb) the New System Components shall comply with all
industry standards and Environmental Requirements applicable thereto and shall
at all times be fully fit to perform all the functions and purposes for which
they were designed and as required by and set forth in the General Airport
Agreement as the same may be replaced by New Airport Fueling Agreements,
(cc) the New System Components and the System shall at
all times meet or exceed all aspects of the System as it existed prior to the
commencement of the Fuel Line Work, including without limitation, in capacity,
integrity, functional capability, efficiency and operation,
(dd) the Fuel Line Work shall not be included or
includable in System Costs,
(ee) the New System Components shall not increase the
costs and expenses to operate, maintain, repair or use the Distribution Portion
of the System or the Satellite Portion of the System, or any portion thereof or
increase the System Costs,
(ff) the New System Components shall at all times
throughout their expected useful life operate free from any defects,
deficiencies or failures of any kind, including without limitation, any leaks or
any defects, deficiencies or failures in design, workmanship, construction or
materials,
(gg) neither the Fuel Line Work nor the New System
Components shall violate any Environmental Requirement or cause or result in any
Environmental Damages, and
(hh) the New System Components, including without
limitation, the cathodic protection system to be installed by the Lessee as part
of the Airline Terminal Portion of the Work, shall be designed to be and shall
be fully integrated into and compatible with the Distribution Portion and the
Satellite Portion of the System (each of the foregoing described in items (aa),
(bb), (cc), (dd), (ee), (ff), (gg) and (hh) of this paragraph (o)(2)(xi) and the
warranties described in paragraph (g)(8) of this Section being herein called a
"Warranty").
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Upon the Lessee's receipt at any time and from time to time of notice from the
Port Authority or any Governmental Authority or other Person that a Warranty has
been breached or not complied with or in the event the Lessee becomes aware of
or receives any other notice (constructive or otherwise) of a breach of or
noncompliance with a Warranty (any such breach or noncompliance being herein
called a "Defect"), the Lessee shall in accordance with all the terms and
conditions of this Agreement including without limitation Section 33 hereof and
at its sole cost and expense, repair, modify or replace such Defect or do
whatever else shall be required to correct such Defect, including without
limitation, removing, relocating and replacing all or a part of the New System
Components and all necessary and required work to accomplish the foregoing and
none of such costs and expenses shall be or become System Costs. The foregoing
warranty, representation and guarantee shall not be a limitation on any
expressed or implied warranty or guaranty otherwise available to the Port
Authority or the Other Users or any of them, under this Agreement, any of the
contracts for the Fuel Line Work, law, equity or otherwise or a limitation on
any other rights or remedies which the Port Authority and/or any Other Users may
have in connection with the Fuel Line Work, the System or the New System
Components whether pursuant to the Airport Fueling Agreements, this Agreement,
at law or equity, or otherwise.
(xii) Without limiting any other term or condition of this
Agreement and in addition to the terms and conditions set forth elsewhere in
this Lease, the Lessee hereby relieves and releases the Port Authority and the
Other Users from and assumes all the Fuel Line Risks.
(xiii) (aa) Without limiting any other term or provision
hereof and in addition thereto, the Lessee shall release, hold harmless and
indemnify the Other Users and each of them and the Port Authority and its
Commissioners, officers and employees and representatives from and against,
including without limitation, reimbursing the Other Users and the Port
Authority for their costs and expenses (including without limitation all
legal costs and expenses including the costs and expenses of the Port
Authority's own in-house legal staff), incurred in connection with the
defense, settlement or satisfaction of all claims and demands, just or
unjust, arising or alleged to arise out of the Fuel Line Work, the New
System Components, the Abandoned Fuel Lines, the Fuel Line Risks, each
Warranty, any Defects, or any breach by the Lessee of any term or provision
of this paragraph (o), or any breach of the General Airport Agreement or of
the New Airport Fueling Agreements with respect to this paragraph (o),
including without limitation, for death, personal injury or property
damage, whether pursuant to contract, permit, lease, law, equity or
otherwise, whether direct or consequential, and whether they arise from the
acts or omissions of the Lessee or of any contractors of the Lessee, or of
the Port Authority or any contractor of the Port Authority or of third
persons, or of the Other Users or any of them, or from acts of God or a
public enemy or otherwise (including claims of the City of New York against
the Port Authority pursuant to the provisions of the Basic Lease whereby
the Port Authority has agreed to indemnify the City against claims),
provided, however, that the Lessee shall not be required to indemnify the
Port Authority pursuant to this paragraph (o)(2)(xiii) where indemnity
would be precluded pursuant to provisions of any statute.
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(bb) If so directed, the Lessee shall at its own
expense defend any suit based upon any such claim or demand (even if such
suit, claim or demand is groundless, false or fraudulent), and in handling
such it shall not, without obtaining express advance written permission
from the General Counsel of the Port Authority, raise any defense involving
in any way the jurisdiction of the tribunal over the person of the Port
Authority, the immunity of the Port Authority, its Commissioners, officers,
agents or employees, the governmental nature of the Port Authority, or the
provisions of any statutes respecting suits against the Port Authority.
(xiv) The terms and conditions set forth in subparagraphs
(i), (vii), (viii), (ix), (xi), (xii) and (xiii) of this paragraph (o)(2) shall
inure to the benefit of the Other Users.
(xv) No acceptance or approval of the Fuel Line Work by the
Port Authority in part or in whole whether as set forth in paragraphs (f) and
(n) of this Section or in subparagraph (3) of this paragraph (o) or otherwise,
shall in part or in whole, release or relieve the Lessee from its obligations
under this paragraph (o) or otherwise. Moreover, neither the enumeration in this
paragraph (o) nor the enumeration elsewhere in this Agreement of particular
risks assumed by the Lessee or of particular claims for which it is responsible
shall be deemed (x) to limit the effect of the provisions of this paragraph (o)
or of any other Section of this Agreement relating to such risks or claims, (y)
to imply that the Lessee assumes or is responsible for risks or claims only of
the type enumerated in this paragraph (o) or in any other portion of this
Agreement, or (z) to limit the risks which the Lessee would assume or the claims
or demands for which it would be responsible in the absence of such enumeration.
(3) In addition to and without affecting the obligations of the
Lessee pursuant to paragraph (n) of this Section, when an integral and material
portion of the Distribution Portion Work and/or the Satellite Portion Work is
fully operational, has been successfully tested and properly flushed and is
ready to be placed in service, the Lessee shall so advise the Port Authority and
shall deliver to the Port Authority a certificate signed by an authorized
officer of the Lessee and also signed by the Lessee's licensed architect or
engineer certifying that such portion of the Fuel Line Work has been
constructed, inspected and tested in accordance with approved plans and
specifications, the provisions of the Lease and the General Airport Agreement
and, if, there is in effect, the New Airport Fueling Agreements and in
compliance with all applicable laws, ordinances and governmental rules,
regulations and orders, including without limitation the System License, and
specifying the portion of the Distribution Portion Work and/or the Satellite
Portion that has been so completed, inspected and tested. The Port Authority may
in its sole discretion deliver a certificate to the Lessee with respect to such
portion of the Distribution Portion Work and/or Satellite Portion Work stating
that such portion may be placed in operation for the purposes set forth in the
General Airport Agreement and, if, there is in effect, the New Airport Fueling
Agreements and subject to and in accordance with all the terms and conditions of
this Lease and the General Airport Agreement and, if, there is in effect, the
New Airport Fueling Agreements and subject to the risks set forth in paragraph
(h) hereof in the event that the Port Authority has not approved the plans and
specifications for the Redevelopment Work.
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(p) ▇▇▇▇▇▇'s Ongoing Operations:
The Lessee acknowledges that it may be conducting on that portion
of the Premises shown in stipple, stippled cross hatching and stippled diagonal
hatching on Exhibit 2.10 the operations permitted by Section 5 hereof and at
Terminal 6 the operations permitted under Lease AYD-265 made as of December 1,
2003 between the Port Authority and the Lessee ("Lease AYD-265"), during the
period of time it is performing a portion of the Construction Work hereunder.
The Lessee further acknowledges that this may involve among other things
inconvenience, noise, dust, interference and disturbance to the Lessee in its
operations at the Premises and at Terminal 6 as well as to its customers,
patrons, invitees and employees and possibly other risks as well. The Lessee
hereby expressly assumes all of the foregoing risks and agrees that there will
be no reduction or abatement of any of the rentals, fees or charges payable by
the Lessee under this Lease, under Lease AYD-265 or otherwise on account of its
performance of the Construction Work and that the performance of the
Construction Work shall not constitute an eviction or constructive eviction of
the Lessee nor be grounds for any abatement of rentals, fees or charges payable
by the Lessee under this Lease, under Lease AYD-265 or otherwise nor give rise
to or be the basis of any claim or demand by the Lessee against the Port
Authority, its Commissioners, officers, employees or agents for damages,
consequential or otherwise, under this Lease or otherwise.
(q) Assignment of Contracts and Plans and Specifications:
(1) As part of the consideration in entering into this Agreement,
the Lessee shall execute and deliver to the Port Authority for the Port
Authority's execution at the same time that the Port Authority shall execute
this Agreement an agreement in the form attached hereto, hereby made a part
hereof and marked "Exhibit 2.19" covering the assignment of the Redevelopment
Work Contracts and Documents to the Port Authority (such agreement as duly
executed by the Port Authority and the Lessee, as the same may be amended,
supplemented, or otherwise modified from time to time, is herein referred to as
the "Assignment of Redevelopment Work Contracts and Documents"). The Lessee
hereby agrees that a breach or failure to perform or comply with any of the
terms and conditions of the Assignment of Redevelopment Work Contracts and
Documents shall constitute a breach of this Lease thereby entitling the Port
Authority to immediately exercise any and all rights available to it as fully as
if such breach, failure or non-compliance was a breach of this Lease, including
without limitation, the right to terminate this Lease pursuant to Section 20
hereof.
(2) The Lessee shall not enter into a Redevelopment Work Contract
with a Redevelopment Work Contractor for the Parking Garage Work unless
simultaneously with the Lessee's execution of such Redevelopment Work Contract
the Redevelopment Work Contractor shall duly execute and deliver to the Port
Authority a consent and agreement in the form attached to the Assignment of
Redevelopment Work Contract and Documents attached thereto as "Exhibit A"
covering all warranties, guaranties and maintenance contracts, including without
limitation any Port Authority Service Contract relating to the Parking Garage
Work and which is covered by such Redevelopment Work Contract.
(r) ▇▇▇▇▇▇'s Obligations for Costs and Delays:
72
(1) The Lessee shall be solely and fully responsible for all
Project Costs except for the Net Cost of Port Authority Requested Change Orders
without any payment or reimbursement or claim or right to payment or
reimbursement from the Port Authority except as otherwise expressly provided in
paragraph (g)(12) of this Section and in Section 87 hereof entitled "Port
Authority Payments For the Cost of the Redevelopment Work".
(2) Except as set forth in paragraph (s) of this Section and as
set forth in paragraph (a)(14) of Section 87 hereof, the Lessee shall be solely
and fully responsible for all delays in connection with the Construction Work
and all costs associated therewith (which costs shall be included as a Project
Cost), including without limitation all delays associated or in connection with
the MOA, and the Port Authority shall not in any event have any liability or
obligation to the Lessee or to any other person, party or entity, including
without limitation any contractor or subcontractor (at any tier) of the Lessee,
for any delay in the Construction Work or for any increase in the costs of the
Construction Work, or any portion thereof, or for any remedy or damages,
monetary or otherwise, at law or in equity, arising from, relating to or in any
way in connection with any such delay (including stoppage) or increase in costs;
nor shall any such cause, delay, stoppage or increase in costs result in or
entitle the Lessee to any abatement, reduction, diminution or suspension of any
rental or other payment obligation hereunder.
(3) The Lessee agrees that the Lessee's $80 Million Work shall be
completed on or before the Tentative Final Certificate Date and shall not be
paid for by the Port Authority pursuant to Section 87 hereof or otherwise.
(s) Parking Garage DEC Delays:
(1) The following terms, when used in this Agreement, shall,
unless the context shall require otherwise, have the respective meanings given
below:
(i) "Parking Garage DEC Delay" shall mean that in the sole
and reasonable opinion of the Chief Engineer of the Port Authority the Parking
Garage Completion Date shall have been actually and necessarily delayed beyond
the later to occur of the Second Enplanement Rental Abatement End Date and the
Extended Second Enplanement Rental Abatement End Date, if any, directly and
solely because of remediation required by the DEC of one or more Hazardous
Substances in the soil or ground water in, on or under the Parking Garage Site,
provided, however, that there shall be no Parking Garage DEC Delay for any
remediation of any Lessee Hazardous Substance.
(ii) "Parking Garage DEC Delay Costs" shall mean that
portion of the Cost of the Parking Garage Work that in the sole and reasonable
opinion of the Chief Engineer of the Port Authority were incurred directly and
solely because of a Parking Garage DEC Delay and would not have for any other
reason but for the Parking Garage DEC Delay have been incurred.
(2) If a Parking Garage DEC Delay shall have occurred, then,
provided and subject to all of the following terms and conditions the Parking
Garage DEC Delay
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Costs shall not be included as a part of the Cost of the Lessee's Redevelopment
Work Elements and shall be and become a part of the Cost of the Port Authority
Redevelopment Work Elements and be paid to the Lessee by the Port Authority
pursuant to Section 87 hereof as a part of the Cost of the Port Authority
Redevelopment Work Elements:
(i) No Parking Garage DEC Delay shall occur or be deemed to
have occurred if such delay could have been avoided or mitigated by the exercise
of all reasonable precautions, efforts and measures (including, without
limitation, planning, scheduling and rescheduling and the cooperation and
coordination called for under subparagraph (4) of this paragraph (s)), whether
before or after the occurrence of the cause of delay; or was due in whole or in
part due to the performance of the Construction Work, or portion thereof, any
fault of the Lessee or any contractor or subcontractor (at any tier) of the
Lessee or for any other delay for which the Lessee or any contractor or
subcontractor (at any tier) of the Lessee is entitled to an extension of time.
Further, no Parking Garage DEC Delay Costs shall be or be deemed to have
incurred if such costs could have been avoided or mitigated by the exercise of
all reasonable precautions, efforts and measures (including, without limitation,
planning, scheduling and rescheduling and the cooperation and coordination
called for under subparagraph (4) of this paragraph (s)), whether before or
after the incurrence of any costs; or were due in whole or in part due to the
performance of the Construction Work, or portion thereof, any fault of the
Lessee or any contractor or subcontractor (at any tier) of the Lessee or for any
other costs for which the Lessee is entitled to be paid by any Person other than
the Port Authority.
(ii) The Chief Engineer of the Port Authority may defer all
or part of his or her decision on whether a Parking Garage DEC Delay has
occurred or any Parking Garage DEC Delay Costs have been incurred and any such
decision may be rescinded or shortened if it subsequently is found that the
delay can be overcome or reduced or the costs be avoided or reduced by the
exercise of reasonable precautions, efforts and measures (including, without
limitation, the coordination and cooperation called for under subparagraph (4)
of this paragraph (s)).
(3) (i) As a condition precedent to the occurrence of a Parking
Garage DEC Delay and the incurring of Parking Garage DEC Delay Costs, the Lessee
shall give written notice to the Chief Engineer of the Port Authority promptly
after the time when the Lessee knows of any cause which might result in a
Parking Garage DEC Delay or result in the incurring of any Parking Garage DEC
Delay Costs (including those causes which the Port Authority is responsible for
or has knowledge of), specifically stating that a Parking Garage DEC Delay is or
may be claimed or Parking Garage DEC Delay Costs have or may be incurred,
identifying such cause and describing, as fully as practicable at the time, the
nature and expected duration of the delay and its effect on the completion of
the Parking Garage Work and the estimate of the Parking Garage DEC Delay Costs.
Since a possible Parking Garage DEC Delay and the possible incurring of Parking
Garage DEC Delay Costs may materially alter the scheduling, plans and other
actions of the Port Authority, and since, with sufficient opportunity, the Port
Authority might, if it so elects, attempt to mitigate the effect of a Parking
Garage DEC Delay and the delay for which a Parking Garage DEC Delay might be
claimed, and since merely oral notice may cause disputes as to the existence or
substance thereof, the giving of written notice as above required shall be of
the essence of the Lessee's rights and obligations under this
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paragraph (s) and failure of the Lessee to give written notice as above required
shall be a waiver of the assumption of any Parking Garage DEC Delay Costs by the
Port Authority unless the ability of the Chief Engineer of the Port Authority to
evaluate whether a Parking Garage DEC Delay has occurred or whether any Parking
Garage DEC Delay Costs have incurred, if any, has not been actually prejudiced
by such failure.
(ii) It shall in all cases be presumed that no Parking
Garage DEC Delay has occurred and no Parking Garage DEC Delay Costs shall have
been incurred unless the Lessee shall affirmatively demonstrate to the
satisfaction of the Chief Engineer of the Port Authority that a Parking Garage
DEC Delay has occurred and Parking Garage DEC Delay Costs have been incurred. To
this end, and in addition to and without limiting any other term or provision of
this Agreement, the Lessee shall maintain adequate records supporting any claim
for a Parking Garage DEC Delay and Parking Garage DEC Delay Costs, and in the
absence of such records, the foregoing presumption shall be deemed conclusive.
(4) It is recognized that the Lessee may be performing the
Parking Garage Work, or portions thereof as the case may be, concurrently with
the performance of remediation of the Parking Garage Site by the Port Authority
or its designee that is required by the DEC (the "DEC Required Remediation". The
Port Authority and the Lessee agree to consult with each other, and to cause
each of their respective contractors to cooperate, in the scheduling of the DEC
Required Remediation and to coordinate such scheduling with the scheduling of
the performance of the Parking Garage Work, subject to the requirements of the
DEC, so as to provide minimum interference with the Lessee's scheduling of the
Parking Garage Work. Solely for purposes of the foregoing (and not for any right
of review or approval by the Lessee) the Port Authority and the Lessee will
provide to the other a copy of the remedial work plan or plans, including the
scheduling, for any DEC Required Remediation as and when the same are available
and at such time notify the other party of the estimated completion dates (if
there are phased completion dates) and the estimated completion date of any DEC
Required Remediation.
(t) The Port Authority shall make available to the Lessee, during the
performance of the Redevelopment Work, at no additional rental to the Lessee, a
material and staging area as shown on the exhibit attached hereto, hereby made a
part hereof and marked "Exhibit 2.20" (which exhibit is herein referred to
"Exhibit 2.20" and which area is herein referred to as the "Staging Area"). The
location of the Staging Area may be changed and/or moved by the Port Authority
at any time and from time to time on ninety (90) days' notice to the Lessee. The
Lessee shall have the exclusive use of the Staging Area in connection with the
completion of all the Redevelopment Work until sixty (60) days after the
Completion Date (the "Staging Area Termination Date"). The Lessee shall be
responsible for constructing any necessary improvements to the Staging Area
including but not limited to utilities, fencing and lighting and the demolition
and removal of same prior to the Staging Area Termination Date and for security
and any other services at the Staging Area. The Staging Area and the use thereof
by the Lessee for the purposes set forth above shall be subject to all of the
appropriate terms and provisions of this Agreement including, but not limited
to, indemnity and insurance.
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SECTION 3. TERM
(a) The term of the letting under this Lease (the "Term") shall
commence on the Lease Commencement Date and shall expire ("the "Expiration
Date"), on the earlier to occur of (x) the day preceding the thirty-fourth
(34th) anniversary of the Lease Commencement Date and (y) the thirtieth (30th)
anniversary of DBO, unless sooner terminated in accordance with the terms and
provisions of the Lease, provided, however, in the event there is a Second
Enplanement Rental Abatement End Date and/or an Extended Second Enplanement
Rental Abatement End Date, then unless sooner terminated in accordance with the
terms and provisions of the Lease, the Term shall expire on the earlier to occur
of (x) the day preceding the thirty-fourth (34th) anniversary of the Lease
Commencement Date and (y) the thirtieth (30th) anniversary of the later to occur
of the Second Enplanement Rental Abatement End Date and the Extended Second
Enplanement Rental Abatement End Date.
(b) The Lessee shall have the right to terminate the letting under
this Lease in its entirety, without cause, upon notice to the Port Authority
given by the Lessee at any time during the twelve month period (and only during
such twelve month period) commencing on the twenty-third (23rd) anniversary of
the later to occur of the Third Additional Rental Commencement Date, the Second
Enplanement Rental Abatement End Date and the Extended Second Enplanement Rental
Abatement End Date, and ending on the day immediately preceding the
twenty-fourth (24th) anniversary of the later to occur of the Third Additional
Rental Commencement Date, the Second Enplanement Rental Abatement End Date and
the Extended Second Enplanement Rental Abatement End Date, which termination
shall become effective on (and only on) the day immediately preceding the
twenty-fifth (25th) anniversary of the later to occur of the Third Additional
Rental Commencement Date, the Second Enplanement Rental Abatement End Date and
the Extended Second Enplanement Rental Abatement End Date, (the "Optional
Expiration Date"), provided, however, the letting shall not terminate on the
Optional Expiration Date if the Lessee shall be under notice of default as to
which any applicable period to cure has passed, or under notice of termination,
from the Port Authority, either on the date of its giving of such notice to the
Port Authority or on the Optional Expiration Date. Termination by the Lessee
under the provisions of this paragraph (b) shall have the same effect as if the
Optional Expiration Date were the date of expiration of the term of the letting
under this Agreement.
SECTION 4. RENTAL
I. Definitions
For the purposes of this Lease the following terms shall have the
respective meanings given below:
(a) "Adjustment Period" shall mean, as the context requires, the
period commencing on January 1, 2006 and expiring on December 31, 2006 (the
"First Adjustment Period") and each of the succeeding twelve-month periods
beginning on each January 1st thereafter occurring to and including the
Expiration Date, provided, however, in the event the Expiration Date is on other
than the last day of a calendar year then in such event the last "Adjustment
Period" shall expire on the Expiration Date.
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(b) "Annual Period" shall mean, as the context requires, the
twelve-month period commencing with the Full Enplanement Rental Commencement
Date and each twelve-month period thereafter occurring, each such Annual Period
to commence on the anniversary of the Full Enplanement Rental Commencement Date,
provided, however, that if the Full Enplanement Rental Commencement Date is
other than the first day of a calendar month, the first Annual Period shall
include the portion of the month in which the Full Enplanement Rental
Commencement Date occurs following such date plus the succeeding eleven calendar
months and each such subsequent Annual Period shall commence on the anniversary
of the first day of the first full calendar month in which the first anniversary
of the Full Enplanement Rental Commencement Date occurs, provided, further, that
the last Annual Period shall end on the Expiration Date.
(c) "Base Enplanement Rental" shall mean for each Annual Period
the Initial Base Enplanement Rental for such Annual Period, as the same may have
been adjusted pursuant to the terms of Sections 42 and 43 hereof.
(d) "CPI" or "Consumer Price Index" shall mean the Consumer Price
Index for all Urban Consumers, New York-Northern New Jersey, Long Island,
NY-NJ-CT (All Items, unadjusted 1982-84=100) published by the Bureau of Labor
Statistics of the United States Department of Labor.
(e) "CPI Percentage Increase" shall mean the annual percentage
increase, if any, in the CPI yielded by dividing the amount of the increase, if
any, in the CPI for one Reference Month as compared to the CPI for the
immediately preceding Reference Month, by the CPI for the earlier of the two
Reference Months; as determined by the Port Authority.
(f) "DBO" and "Date of Beneficial Occupancy" shall each mean the
date of the issuance of a certificate issued by the Port Authority pursuant to
Section 2(n)(2) covering the completion, or partial completion, of the Terminal
Work so that with the issuance of such certificate, 13 or more Gates and Gate
Related Premises at the New Passenger Terminal are sufficiently completed so as
to allow the use and occupancy thereof.
(g) "Enplanement" shall mean each aircraft passenger that departs
by aircraft from the Premises, provided, however, Enplanements shall not include
aircraft passengers that are employees of a Scheduled Aircraft Operator for whom
the Lessee does not receive any monies or other revenue or that are employees of
a wholly owned subsidiary of the Lessee for whom the Lessee does not receive any
monies or other revenue.
(h) "Enplanement Rental"shall mean in the singular each of, and
"Enplanement Rentals" shall collectively mean, the First Enplanement Rental and
the Second Enplanement Rental.
(i) "Fifth Ground Rental" shall mean the rental payable by the
Lessee to the Port Authority pursuant to and calculated in accordance with the
terms of paragraph (a)(5) of Subdivision II of this Section.
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(j) "Fifth Variable Per Enplanement Rental Rate" shall mean with
respect to each Annual Period, an amount equal to the product obtained by
multiplying the Per Enplanement Rental Rate for such Annual Period, as the same
may have been reduced and adjusted by the provisions of paragraph (b)(3) of
Subdivision II hereof, by Forty-eight Percent (48%).
(k) "Final Payment Date" shall mean the date that the last Port
Authority Payment shall be made to the Lessee.
(l) "First Additional Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
the terms of paragraph (c)(1) of Subdivision II of this Section.
(m) "First Enplanement Date" shall mean the date that the first
Enplanement shall occur from the New Passenger Terminal.
(n) "First Enplanement Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
the terms of paragraph (b)(1) of Subdivision II of this Section.
(o) "First Ground Rental" shall mean the rental payable by the
Lessee to the Port Authority pursuant to and calculated in accordance with the
terms of paragraph (a)(1) of Subdivision II of this Section.
(p) "First Temporary Enplanement Date" shall mean the date that
the first Enplanement shall occur from the Temporary Facilities.
(q) "First Variable Per Enplanement Rental Rate" shall mean with
respect to each Annual Period, an amount equal to the product obtained by
multiplying the Per Enplanement Rental Rate for such Annual Period, as the same
may have been reduced and adjusted by the provisions of paragraph (b)(3) of
Subdivision II hereof, by Ninety-Five Percent (95%).
(r) "Fourth Additional Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
the terms of paragraph (c)(4) of Subdivision II of this Section.
(s) "Fourth Ground Rental" shall mean the rental payable by the
Lessee to the Port Authority pursuant to and calculated in accordance with the
terms of paragraph (a)(4) of Subdivision II of this Section.
(t) "Fourth Variable Per Enplanement Rental Rate" shall mean with
respect to each Annual Period, an amount equal to the product obtained by
multiplying the Per Enplanement Rental Rate for such Annual Period, as the same
may have been reduced and
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adjusted by the provisions of paragraph (b)(3) of Subdivision II hereof, by
Sixty-Three Percent (63%).
(u) "Full Enplanement Rental Commencement Date" shall mean the
first to occur of (i) DBO and (ii) the fourth (4th) anniversary of the Lease
Commencement Date.
(v) "Ground Rental Base Rate" shall mean for the period from the
Lease Commencement Date to December 31, 2005, both dates inclusive, an annual
rate per square foot of ground area of $1.962534, which annual rate shall
thereafter be increased as follows:
(1) The Ground Rental Base Rate of $1.962534 set forth above
in this paragraph (v) shall be separately multiplied (A) by a percentage
composed of 1/2 of the CPI Percentage Increase as calculated using the two
immediately preceding Reference Months (i.e. October 2004 and October 2005)
plus 100% and (B) by 104%; and the greater of the amounts so obtained from
the foregoing calculations set forth in clauses (A) and (B) shall be and
become the Ground Rental Base Rate for the First Adjustment Period, as
defined in paragraph (a) of this Subdivision I of this Section.
(2) The Port Authority shall ascertain the CPI for the first
Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI
Percentage Increase.
(3) Effective on January 1, 2007 and on the first day of
each Adjustment Period thereafter, the Ground Rental Base Rate shall be
further increased for each Adjustment Period as follows: the amount of the
Ground Rental Base Rate set forth in paragraph (v)(1) above as the same may
have been last adjusted under this paragraph (v)(3), shall be separately
multiplied (A) by a percentage composed of 1/2 of the CPI Percentage
Increase as calculated using the two immediately preceding Reference Months
plus 100% and (B) by 104%; and the greater of the amounts so obtained from
the foregoing calculations set forth in clauses (A) and (B) shall be and
become the Ground Rental Base Rate for the subject Adjustment Period.
(w) "Guaranteed Annual Enplanements" shall mean the Initial Base
Guaranteed Annual Enplanements, for each Annual Period, as the same may have
been adjusted pursuant to the terms of Sections 42 and 43 hereof.
(x) "Initial Base Enplanement Rental" shall mean for each Annual
Period an amount equal to the product obtained by multiplying the Initial Base
Guaranteed Annual Enplanements for such Annual Period by the Per Enplanement
Rental Rate for such Annual Period as such Per Enplanement Rental Rate may have
been reduced and adjusted by the provisions of paragraph (b)(3) of Subdivision
II hereof.
(y) "Initial Base Guaranteed Annual Enplanements" shall mean for
each Annual Period the following number of Enplanements:
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(1) For the first Annual Period, Five Million Eight Hundred
Seventy-seven Thousand Three Hundred Seventy-six (5,877,376) Enplanements,
and
(2) For the second Annual Period, Six Million Seven Hundred
Eight Thousand Nine Hundred Ninety-two (6,708,992) Enplanements, and
(3) For the third Annual Period, Seven Million Five Hundred
Forty Thousand Six Hundred Eight (7,540,608) Enplanements, and
(4) For the fourth Annual Period, Seven Million Six Hundred
Seventy-one Thousand Four Hundred Twenty-four (7,671,424) Enplanements, and
(5) For each and every Annual Period after the fourth Annual
Period, Seven Million Eight Hundred Two Thousand Two Hundred Forty
(7,802,240) Enplanements.
(z) "Initial Minimum Enplanement Rental" shall mean for each
Annual Period the amount set forth for such Annual Period in the exhibit
attached hereto, hereby made a part hereof and marked "Exhibit 4.1" under the
column entitled "Initial Minimum Enplanement Rental".
(aa) "Minimum Enplanement Rental" shall mean for each Annual
Period the Initial Minimum Enplanement Rental for such Annual Period, as the
same may have been adjusted pursuant to the terms of Sections 42 and 43 hereof.
(bb) "Monthly Period" shall mean, as the context requires, the
period commencing on the First Enplanement Date and expiring at the end of the
calendar month in which the First Enplanement Date shall occur and each calendar
month thereafter occurring up to and including the day immediately preceding the
later to occur of (x) the day preceding the Full Enplanement Rental Commencement
Date,(y) the Second Enplanement Rental Abatement End Date and (z) the Extended
Second Enplanement Rental Abatement End Date, it being understood that if the
Full Enplanement Rental Commencement Date, the Second Enplanement Rental
Abatement End Date and the Extended Second Enplanement Rental Abatement End Date
shall be other than the first day of a calendar month, then the last Monthly
Period shall not be a full calendar month.
(cc) "Payment Date" shall mean with respect to each Port
Authority Payment, the date that such Port Authority Payment shall be made to
the Lessee.
(dd) "Per Enplanement Rental Rate" shall mean for each Annual
Period the amount set forth for such Annual Period in the exhibit attached
hereto, hereby made a part hereof and marked "Exhibit 4.2" (which exhibit is
herein referred to as "Exhibit 4.2") under the column entitled "Per Enplanement
Rental Rate", as the same may have been reduced and adjusted pursuant to
paragraph (b)(3) of Subdivision II of this Section.
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(ee) "Post-DBO Additional Rental Commencement Date" shall mean
the period commencing on the first day of the thirteenth (13th) calendar month
following the earlier to occur of (i) the calendar month in which DBO shall have
occurred and (ii) the calendar month in which the fifth (5th) anniversary of the
Lease Commencement Date shall have occurred.
(ff) "Reference Month" shall mean the calendar month of October
2004 (the first Reference Month) and each succeeding calendar month of October
thereafter occurring.
(gg) "Second Additional Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
the terms of paragraph (c)(2) of Subdivision II of this Section.
(hh) "Second Enplanement Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
the terms of paragraph (b)(2) of Subdivision II of this Section.
(ii) "Second Ground Rental" shall mean the rental payable by the
Lessee to the Port Authority pursuant to and calculated in accordance with the
terms of paragraph (a)(2) of Subdivision II of this Section.
(jj) "Second Variable Per Enplanement Rental Rate" shall mean
with respect to each Annual Period, an amount equal to the product obtained by
multiplying the Per Enplanement Rental Rate for such Annual Period, as the same
may have been reduced and adjusted by the provisions of paragraph (b)(3) of
Subdivision II hereof, by Eighty-eight Percent (88%).
(kk) " Temporary Facility Ground Rental" shall mean the rental
payable by the Lessee to the Port Authority pursuant to and calculated in
accordance with the terms of paragraph (a)(6) of Subdivision II of this Section.
(ll) "Third Additional Rental" shall mean the rental payable by
the Lessee to the Port Authority pursuant to and calculated in accordance with
paragraph (c)(3) of Subdivision II of this Section.
(mm) "Third Ground Rental" shall mean the rental payable by the
Lessee to the Port Authority pursuant to and calculated in accordance with the
terms of paragraph (a)(3) of Subdivision II of this Section.
(nn) "Third Variable Per Enplanement Rental Rate" shall mean for
each Annual Period, an amount equal to the product obtained by multiplying the
Per Enplanement Rental Rate for such Annual Period, as the same may have been
reduced and adjusted by the provisions of paragraph (b)(3) of Subdivision II
hereof, by Seventy-eight Percent (78%).
(oo) "Variable Enplanement Rental" shall mean for each Annual
Period, the sum of the following amounts:
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(1) The product obtained by multiplying the First Variable
Per Enplanement Rental Rate by the number of Enplanements occurring during
such Annual Period in excess of the Guaranteed Annual Enplanements for such
Annual Period but not in excess of 500,000 Enplanements more than the
Guaranteed Annual Enplanements for such Annual Period; and
(2) The product obtained by multiplying the Second Variable
Per Enplanement Rental Rate by the number of Enplanements occurring during
such Annual Period in excess of 500,000 Enplanements above the Guaranteed
Annual Enplanements for such Annual Period but not in excess of 1,000,000
Enplanements more than the Guaranteed Annual Enplanements for such Annual
Period; and
(3) The product obtained by multiplying the Third Variable
Per Enplanement Rental Rate by the number of Enplanements occurring during
such Annual Period in excess of 1,000,000 Enplanements above the Guaranteed
Annual Enplanements for such Annual Period but not in excess of 1,500,000
Enplanements more than the Guaranteed Annual Enplanements for such Annual
Period; and
(4) The product obtained by multiplying the Fourth Variable
Per Enplanement Rental Rate by the number of Enplanements occurring during
such Annual Period in excess of 1,500,000 Enplanements above the Guaranteed
Annual Enplanements for such Annual Period but not in excess of 2,000,000
Enplanements more than the Guaranteed Annual Enplanements for such Annual
Period; and
(5) The product obtained by multiplying the Fifth Variable
Per Enplanement Rental Rate by the number of Enplanements occurring during
such Annual Period in excess of 2,000,000 Enplanements above the Guaranteed
Annual Enplanements for such Annual Period.
II. Rentals:
(a) Ground Rentals:
(1) First Ground Rental:
For the period from and including the Lease Commencement
Date to and including the earliest to occur of (x) the day immediately preceding
the fourth (4th) anniversary of the Lease Commencement Date, (y) the day
immediately preceding DBO and (z) the day immediately preceding the First
Enplanement Date, the Lessee shall pay to the Port Authority a rental (the
"First Ground Rental") for the ground area shown in stipple, stippled diagonal
hatching and stippled double parallel vertical hatching on Exhibit 1.1 in the
amounts set forth below.
(i) The First Ground Rental shall be in the amount of
Three Million Three Hundred Fifty-nine Thousand Six Hundred Seventy-eight
Dollars and No
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Cents ($3,359,678.00) per annum for the period from the Lease Commencement Date
to December 31, 2005, both dates inclusive, which First Ground Rental shall
thereafter be adjusted on an annual basis as hereinafter set forth.
(ii) The Port Authority shall ascertain the CPI for the
first Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI Percentage
Increase.
(iii) (aa) Effective on January 1, 2006 the First
Ground Rental in the amount of Three Million Three Hundred Fifty-nine Thousand
Six Hundred Seventy-eight Dollars and No Cents ($3,359,678.00) per annum as set
forth in paragraph (a)(1)(i) above shall be increased as follows: the First
Ground Rental set forth in paragraph (a)(1)(i) above shall be separately
multiplied (x) by a percentage composed of 1/2 of the CPI Percentage Increase as
calculated using the two immediately preceding Reference Months (i.e. October
2004 and October 2005) plus 100% and (y) by 104%; and the greater of the amounts
so obtained from the foregoing calculations set forth in clauses (x) and (y)
shall be and become the First Ground Rental in effect for the Adjustment Period
commencing on January 1, 2006.
(bb) Effective on January 1, 2007 and on the first
day of each Adjustment Period thereafter occurring up to and including the
earliest to occur of (x) the day immediately preceding the fourth (4th)
anniversary of the Lease Commencement Date, (y) the day immediately
preceding DBO and (z) the day immediately preceding the First Enplanement
Date, the First Ground Rental shall be further increased for each
Adjustment Period as follows: the amount of the First Ground Rental set
forth in paragraph (a)(1)(i) above as the same shall have been last
adjusted under this paragraph (a)(1)(iii), shall be separately multiplied
(x) by a percentage composed of 1/2 of the CPI Percentage Increase
calculated using the two Reference Months immediately preceding the first
day of the subject Adjustment Period plus 100% and (y) by 104%; and the
greater of the amounts so obtained from the foregoing calculations set
forth in clauses (x) and (y) shall be and become the First Ground Rental in
effect for the subject Adjustment Period.
(2) Second Ground Rental:
From and after the earliest to occur of (x) the fourth (4th)
anniversary of the Lease Commencement Date, (y) DBO and (z) the First
Enplanement Date (the "Second Ground Rental Commencement Date"), the Lessee
shall pay to the Port Authority an annual rental (the "Second Ground Rental")
for the ground area shown in stipple, stippled diagonal hatching and stippled
double parallel vertical hatching on Exhibit 1.1 calculated, and in the amounts
stated, as follows:
(i) The Port Authority shall determine the Second Ground
Rental in effect on the Second Ground Rental Commencement Date, which Second
Ground Rental shall be an annual amount equal to the product obtained from the
following calculation:
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(aa) First, the number of square feet of land area in
the Terminal 4 Parcel if the Terminal 4 Parcel is a part of the Premises on
the Second Ground Rental Commencement Date, the number of square feet of
land area in the Terminal 6 Parcel if the Terminal 6 Parcel is a part of
the Premises on the Second Ground Rental Commencement Date and the number
of square feet of land area in the remainder of the Premises all shall be
calculated to the second decimal place; then
(bb) Second, the number of square feet of land area in
the Terminal 4 Parcel if the Terminal 4 Parcel is a part of the Premises on
the Second Ground Rental Commencement Date and the number of square feet of
land area in the Terminal 6 Parcel if the Terminal 6 Parcel is a part of
the Premises on the Second Ground Rental Commencement Date, each of the
foregoing calculated to the second decimal place, shall be subtracted from
the number of square feet of land area in the Premises; then
(cc) Third, the difference resulting from the
subtraction performed in the foregoing clause (bb), if any, shall be
multiplied by the Ground Rental Base Rate in effect during the Adjustment
Period during which the Second Ground Rental Commencement Date shall occur.
The resulting product from the calculation in the foregoing clause (cc) shall be
and become the Second Ground Rental payable for the period from the Second
Ground Rental Commencement Date to and including the December 31st of the
calendar year in which the Second Ground Rental Commencement Date shall occur,
which Second Ground Rental shall thereafter be adjusted on an annual basis as
hereinafter set forth during the Term.
(ii) The Port Authority shall ascertain the CPI for the
first Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI Percentage
Increase.
(iii) (aa) Effective on the first January 1st following the
Second Ground Rental Commencement Date, the Second Ground Rental shall be
increased as follows: the Second Ground Rental set forth in paragraph
(a)(2)(i) above shall be separately multiplied (x) by a percentage composed
of 1/2 of the CPI Percentage Increase as calculated using the two Reference
Months immediately preceding such January 1st, plus 100% and (y) by 104%;
and the greater of the amounts so obtained from the foregoing calculations
set forth in clauses (x) and (y) shall be and become the Second Ground
Rental in effect for the Adjustment Period commencing on the first January
1st following the Second Ground Rental Commencement Date.
(bb) Effective on the second January 1st following the
Second Ground Rental Commencement Date and on the first day of each
Adjustment Period occurring during the remainder of the Term, the Second
Ground Rental shall be further increased for each Adjustment Period as
follows: the amount of the Second Ground Rental set forth in paragraph
(a)(2)(i) above as the same shall have been last adjusted under this
paragraph (a)(2)(iii), shall be separately multiplied (x) by a
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percentage composed of 1/2 of the CPI Percentage Increase calculated using
the two Reference Months immediately preceding the first day of the subject
Adjustment Period plus 100% and (y) by 104%; and the greater of the amounts
so obtained from the foregoing calculations set forth in clauses (x) and
(y) shall be and become the Second Ground Rental in effect for the subject
Adjustment Period.
(3) Third Ground Rental:
From and after the Terminal 6 Parcel Tender Date, the Lessee
shall pay to the Port Authority an annual rental (the "Third Ground Rental") for
the Terminal 6 Parcel in the amounts and as calculated as follows:
(i) The Port Authority shall determine the Third Ground
Rental in effect on the Terminal 6 Parcel Tender Date, which Third Ground Rental
shall be an annual amount equal to the product obtained by multiplying the
number of square feet of land area in the Terminal 6 Parcel on the Terminal 6
Parcel Tender Date, calculated to the second decimal place, by the Ground Rental
Base Rate in effect during the Adjustment Period during which the Terminal 6
Parcel Tender Date shall occur, and such product shall be and become the Third
Ground Rental payable for the period from the Terminal 6 Parcel Tender Date to
and including the December 31st of the calendar year in which the Terminal 6
Parcel Tender Date shall occur, which Third Ground Rental shall thereafter be
adjusted during the Term on an annual basis as hereinafter set forth.
(ii) The Port Authority shall ascertain the CPI for the
first Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI Percentage
Increase.
(iii) (aa) Effective on the first January 1st following the
Terminal 6 Parcel Tender Date, the Third Ground Rental shall be increased
as follows: the Third Ground Rental set forth in paragraph (a)(3)(i) above
shall be separately multiplied (x) by a percentage composed of 1/2 of the
CPI Percentage Increase as calculated using the two Reference Months
immediately preceding such January 1st, plus 100% and (y) by 104%; and the
greater of the amounts so obtained from the foregoing calculations set
forth in clauses (x) and (y) shall be and become the Third Ground Rental in
effect for the Adjustment Period commencing on the first January 1st
following the Terminal 6 Parcel Tender Date.
(bb) Effective on the second January 1st following the
Terminal 6 Parcel Tender Date and on the first day of each Adjustment
Period occurring during the remainder of the Term, the Third Ground Rental
shall be further increased for each Adjustment Period as follows: the
amount of the Third Ground Rental set forth in paragraph (a)(3)(i) above as
the same shall have been last adjusted under this paragraph (a)(3)(iii),
shall be separately multiplied (x) by a percentage composed of 1/2 of the
CPI Percentage Increase calculated using the two Reference Months
immediately preceding the first day of the subject Adjustment Period plus
100% and (y) by 104%; and the greater of the amounts so obtained from the
foregoing calculations set forth in clauses (x)
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and (y) shall be and become the Third Ground Rental in effect for the
subject Adjustment Period.
(4) Fourth Ground Rental:
From and after the Terminal 4 Parcel Tender Date, the Lessee
shall pay to the Port Authority an annual rental (the "Fourth Ground Rental")
for the Terminal 4 Parcel in the amounts and as calculated as follows:
(i) The Port Authority shall determine the Fourth Ground
Rental in effect on the Terminal 4 Parcel Tender Date, which Fourth Ground
Rental shall be an annual amount equal to the product obtained by multiplying
the number of square feet of land area in the Terminal 4 Parcel on the Terminal
4 Parcel Tender Date, calculated to the second decimal place, by the Ground
Rental Base Rate in effect during the Adjustment Period during which the
Terminal 4 Parcel Tender Date shall occur, and such product shall be and become
the Fourth Ground Rental payable for the period from the Terminal 4 Parcel
Tender Date to and including the December 31st of the calendar year in which the
Terminal 4 Parcel Tender Date shall occur, which Fourth Ground Rental shall
thereafter be adjusted during the Term on an annual basis as hereinafter set
forth.
(ii) The Port Authority shall ascertain the CPI for the
first Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI Percentage
Increase.
(iii) (aa) Effective on the first January 1st following the
Terminal 4 Parcel Tender Date, the Fourth Ground Rental shall be increased
as follows: the Fourth Ground Rental set forth in paragraph (a)(4)(i) above
shall be separately multiplied (x) by a percentage composed of 1/2 of the
CPI Percentage Increase as calculated using the two Reference Months
immediately preceding such January 1st, plus 100% and (y) by 104%; and the
greater of the amounts so obtained from the foregoing calculations set
forth in clauses (x) and (y) shall be and become the Fourth Ground Rental
in effect for the Adjustment Period commencing on the first January 1st
following the Terminal 4 Parcel Tender Date.
(bb) Effective on the second January 1st following the
Terminal 4 Parcel Tender Date and on the first day of each Adjustment
Period occurring during the remainder of the Term, the Fourth Ground Rental
shall be further increased for each Adjustment Period as follows: the
amount of the Fourth Ground Rental set forth in paragraph (a)(4)(i)above as
the same shall have been last adjusted under this paragraph (a)(4)(iii),
shall be separately multiplied (x) by a percentage composed of 1/2 of the
CPI Percentage Increase calculated using the two Reference Months
immediately preceding the first day of the subject Adjustment Period plus
100% and (y) by 104%; and the greater of the amounts so obtained from the
foregoing calculations set forth in clauses (x) and (y) shall be and become
the Fourth Ground Rental in effect for the subject Adjustment Period.
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(5) Fifth Ground Rental:
On the Lease Commencement Date and on the first day of each
and every month thereafter occurring up to and including the day preceding the
Shell Completion Date, the Lessee shall pay to the Port Authority a monthly
rental (the "Fifth Ground Rental"), which Fifth Ground Rental shall be in an
amount calculated for each and every full or partial calendar month occurring
during such period as follows in the following order:
(i) First, the annual Ground Rental Base Rate in effect for
the month for which the calculation is being made shall be divided by the whole
number 12, provided, however, in the event that that the Lease Commencement Date
is not the first day of a calendar month, or in the event that the Fifth Ground
Rental shall end on a day other than the last day of a calendar month, then for
the purpose of determining the quotient to be calculated pursuant to this
subparagraph (i), the quotient obtained from the foregoing division for such
month shall be prorated on a daily basis using the actual number of days in the
said month that the Fifth Ground Rental is in effect; then;
(ii) Second, the quotient derived in subparagraph (i) above,
as the same may have been prorated, shall be multiplied by the number fifty-six
and three tenths (56.3); then
(iii) Third, the monthly installment of First Ground Rental
payable for the month for which the calculation is being made shall be
subtracted from the product obtained from the calculation made pursuant to
paragraph (a)(5)(ii) of this Subdivision II; then
(iv) Fourth, the monthly installment of Temporary Facility
Ground Rental payable for the month for which the calculation is being made
shall be subtracted from the difference obtained from the calculation made
pursuant to paragraph (a)(5)(iii) of this Subdivision II, and the difference so
obtained shall be the Fifth Ground Rental for such month.
(6) Temporary Facility Ground Rental:
From and including the First Temporary Enplanement Date to
and including the day immediately preceding the Second Ground Rental
Commencement Date, the Lessee shall pay to the Port Authority an annual rental
(the "Temporary Facility Ground Rental") for the ground area shown in stipple
and stippled cross hatching on Exhibit 2.10 in the amount equal to the Annual
Temporary Facility Ground Rental Amount. The "Annual Temporary Facility Ground
Rental Amount" shall mean the amounts determined and calculated as follows:
(i) The Annual Temporary Facility Ground Rental Amount shall
be in the amount of One Million One Hundred Eleven Thousand Three Hundred
Forty-four Dollars and No Cents ($1,111,344.00) per annum for the period from
and including the Lease Commencement Date to and including December 31, 2005,
which Annual Temporary Facility Ground Rental Amount shall thereafter be
adjusted on an annual basis as hereinafter set forth.
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(ii) The Port Authority shall ascertain the CPI for the
first Reference Month and for each succeeding Reference Month after the same has
been published, and the Port Authority shall also determine each CPI Percentage
Increase.
(iii) (aa) Effective on January 1, 2006 the Annual Temporary
Facility Ground Rental Amount shall be increased as follows: the Annual
Temporary Facility Ground Rental Amount set forth in paragraph (a)(6)(i)
above shall be increased as follows: the amount of the Annual Temporary
Facility Ground Rental Amount set forth in paragraph (a)(6)(i), shall be
multiplied (x) by a percentage composed of 1/2 of the CPI Percentage
Increase as calculated using the two immediately preceding Reference Months
plus 100% and (y) by 104%; and the greater of the amounts so obtained from
the foregoing calculations set forth in clauses (x) and (y) shall be and
become the Annual Temporary Facility Ground Rental amount for the
Adjustment Period commencing on January 1, 2006.
(bb) Effective on January 1, 2007 and on each January 1st
thereafter occurring up to and including the day preceding the Second
Ground Rental Commencement Date, the Annual Temporary Facility Ground
Rental Amount shall be further increased for each Adjustment Period as
follows: the amount of the Annual Temporary Facility Ground Rental Amount
set forth in paragraph (a)(6)(i) above as the same shall have been last
adjusted under this paragraph (a)(6)(iii), shall be separately multiplied
(x) by a percentage composed of 1/2 of the CPI Percentage Increase
calculated using the two Reference Months immediately preceding the first
day of the subject Adjustment Period plus 100% and (y) by 104%; and the
greater of the amounts so obtained from the foregoing calculations set
forth in clauses (x) and (y) shall be and become the Annual Temporary
Facility Ground Rental Amount in effect for the subject Adjustment Period.
(7) Payment of Certain Ground Rentals:
(i) The First Ground Rental shall be payable by the Lessee
in advance in equal monthly installments on the Lease Commencement Date and on
the first day of each and every calendar month thereafter occurring up to and
including the day immediately preceding the Second Ground Rental Commencement
Date; and the Second Ground Rental shall be payable by the Lessee in advance in
equal monthly installments on the Second Ground Rental Commencement Date and on
the first day of each and every calendar month thereafter occurring during the
balance of the Term; and the Third Ground Rental shall be payable by the Lessee
in advance in equal monthly installments on the Terminal 6 Parcel Tender Date
and on the first day of each and every calendar month thereafter occurring
during the balance of the Term; and the Fourth Ground Rental shall be payable by
the Lessee in advance in equal monthly installments on the Terminal 4 Parcel
Tender Date and on the first day of each and every calendar month thereafter
occurring during the balance of the Term; and the Temporary Facility Ground
Rental shall by payable by the Lessee in advance in equal monthly installments
on the First Temporary Enplanement Date and on the first day of each and every
calendar month thereafter occurring up to and including the day preceding the
Second Ground Rental Commencement Date.
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(ii) If the First Ground Rental, the Second Ground Rental,
the Third Ground Rental, the Fourth Ground Rental or the Temporary Facility
Ground Rental shall be payable for less than a whole calendar year each monthly
installment payable during such year shall be equal to one-twelfth (1/12th) of
said rental and if any installment of such rental shall be payable for less than
a full calendar month then the rental payment for the portion of the month for
which such payment is due shall be the monthly installment prorated on a daily
basis using the actual number of days in the said month.
(b) Enplanement Rentals:
(1) First Enplanement Rental:
(i) For each and every Monthly Period the Lessee shall
pay a monthly enplanement rental (herein called the "First Enplanement Rental")
equal to the greater of (x) the product obtained by multiplying the amount of
Two Million Three Hundred Seventy-five Thousand Dollars and No Cents
($2,375,000.00) by a fraction the numerator of which shall be the maximum number
of gates at the Premises utilized by the Lessee during any Monthly Period
occurring from the First Enplanement Date through the end of the Monthly Period
for which the calculation is being made and the denominator of which shall be
twenty-four (24) (which product is herein referred to as "the "Minimum First
Enplanement Rental") and (y) the product obtained by multiplying the number of
Enplanements occurring at the Premises during such Monthly Period by $3.45
(which product is herein referred to as the "Activity Based First Enplanement
Rental"); and the greater of the Minimum First Enplanement Rental (as the same
may be pro-rated pursuant to paragraph (b)(1)(iii) of this Subdivision II) and
the Activity Based First Enplanement Rental shall be and become the amount of
the First Enplanement Rental payable by the Lessee to the Port Authority for
such Monthly Period.
(ii) The Lessee shall report the number of Enplanements
and shall pay the First Enplanement Rental as follows: on the 20th day of the
first calendar month following the First Enplanement Date and on the 20th day of
each and every calendar month thereafter including the calendar month following
the end of the last Monthly Period, the Lessee shall render to the Port
Authority a notarized statement signed by a responsible fiscal officer of the
Lessee showing the total number of Enplanements for the preceding Monthly
Period, the total monthly aircraft departures along with the gate designation
used for each such aircraft departure together with the total number of gates
used by the Lessee at the Premises during the preceding Monthly Period and the
maximum number of gates at the Premises utilized by the Lessee during any
Monthly Period occurring from the First Enplanement Date through the end of the
preceding Monthly Period and specifying the Minimum First Enplanement Rental and
the Activity Based First Enplanement Rental calculated for the previous Monthly
Period. The Lessee shall pay to the Port Authority an amount equal to the
greater of the Minimum First Enplanement Rental and the Activity Based First
Enplanement Rental calculated for the preceding Monthly Period at the time of
rendering such statement.
(iii) In the event that any Monthly Period is for less
than a calendar month, the Minimum First Enplanement Rental calculated for such
Monthly Period
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shall be the Minimum First Enplanement Rental calculated in accordance with
paragraph (b)(1)(i) above multiplied by a fraction, the numerator of which shall
be the number of days in such Monthly Period and the denominator of which shall
be the full number of days of the calendar month during which such Monthly
Period occurred.
(iv) The computation of the First Enplanement Rental
for each Monthly Period, or a portion of a Monthly Period, shall be individual
to such Monthly Period, or such portion of a Monthly Period, and without
relation to any other Monthly Period, or any other portion of any Monthly
Period.
(2) Second Enplanement Rental:
(i) Commencing on the Full Enplanement Rental
Commencement Date, the Lessee shall pay to the Port Authority a rental (the
"Second Enplanement Rental") for each Annual Period occurring during the Term in
an amount equal to the greater of (x) the Minimum Enplanement Rental for such
Annual Period and (y) the sum of the Base Enplanement Rental for such Annual
Period and the Variable Enplanement Rental for such Annual Period. The Second
Enplanement Rental shall be paid as follows:
(aa) On the Full Enplanement Rental Commencement
Date and on the first day of each and every calendar month thereafter
occurring during the Annual Period in which the Full Enplanement Rental
shall occur, the Lessee shall pay to the Port Authority a tentative Second
Enplanement Rental in an amount equal to one twelfth (1/12) of the Minimum
Enplanement Rental (without any pro-ration pursuant to paragraph (b)(2)(iv)
of this Subdivision II) for such Annual Period.
(bb) On the first day of each and every calendar
month of each Annual Period occurring after the Annual Period in which the
Full Enplanement Rental Commencement Date shall have occurred, the Lessee
shall pay to the Port Authority a tentative Second Enplanement Rental in an
amount equal to one twelfth (1/12) of the greater of (x) the Minimum
Enplanement Rental (without any pro-ration pursuant to paragraph (b)(2)(iv)
of this Subdivision II) for such Annual Period) and (y) an amount equal to
the sum of the Base Enplanement Rental (without any pro-ration pursuant to
paragraph (b)(2)(iv) of this Subdivision II)) for the immediately preceding
Annual Period and the Variable Enplanement Rental (without any pro-ration
pursuant to paragraph (b)(2)(iv) of this Subdivision II) for such
immediately preceding Annual Period.
(ii) On the first day of the second full calendar month
immediately following the last day of the first Annual Period, and on the first
day of the second full calendar month immediately following the last day of each
Annual Period thereafter, the Lessee shall render to the Port Authority a
notarized statement signed by a responsible fiscal officer of the Lessee showing
the following:
(aa) the total number of Enplanements which
occurred during the immediately preceding Annual Period,
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(bb) the Minimum Enplanement Rental for such
Annual Period and if applicable the prorated amount thereof as calculated
pursuant to paragraph (b)(2)(iv)(aa) of this Subdivision II,
(cc) the Base Enplanement Rental for such Annual
Period and if applicable the prorated amount thereof as calculated pursuant
to paragraph (b)(2)(iv)(bb) of this Subdivision II,
(dd) the Per Enplanement Rental Rate for such
Annual Period,
(ee) the number of Guaranteed Annual Enplanements
for such Annual Period and if applicable the prorated amount thereof as
calculated pursuant to paragraph (b)(2)(iv)(cc) of this Subdivision II, and
(ff) the Variable Enplanement Rental for such
Annual Period including each of the calculations provided for in paragraph
(nn) of Subdivision I of this Section for such Annual Period.
At the time of rendering the statement required
pursuant to this paragraph (b)(2)(ii) if the Second Enplanement Rental for such
Annual Period for which the statement is being provided exceeds the total
cumulative payments made by the Lessee to the Port Authority pursuant to
paragraph (b)(2)(i) above for such Annual Period, the Lessee shall pay to the
Port Authority an amount equal to such excess and if the total cumulative
payments made by the Lessee to the Port Authority pursuant to paragraph
(b)(2)(i) above for the Annual Period for which the statement is being provided
exceeds the Second Enplanement Rental for such Annual Period, then the amount of
such excess shall be credited against the Lessee's payment of future Second
Enplanement Rentals and for the last such statement required to be rendered
after the expiration of the Term, then the Port Authority shall at its election
credit such excess against amounts owed by the Lessee to the Port Authority or
pay such excess to the Lessee.
(iii) The computation of the Second Enplanement Rental
for each Annual Period, or a portion of an Annual Period, shall be individual to
such Annual Period, or such portion of an Annual Period, and without relation to
any other Annual Period, or any other portion of any Annual Period.
(iv) For any Annual Period which contains less than 365
days, the following pro-rated amounts shall be used to calculate the amount of
the Second Enplanement Rental due for such Annual Period:
(aa) The Minimum Enplanement Rental for such
Annual Period shall be prorated by multiplying the Minimum Enplanement
Rental for such Annual Period by a fraction, the numerator of which shall
be the number of days in such Annual Period and the denominator of which
shall be 365.
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(bb) The Base Enplanement Rental for such Annual
Period shall be prorated by multiplying the Base Enplanement Rental for
such Annual Period by a fraction, the numerator of which shall be the
number of days in such Annual Period and the denominator of which shall be
365.
(cc) The Guaranteed Annual Enplanements for such
Annual Period shall be prorated by multiplying the Guaranteed Annual
Enplanements for such Annual Period by a fraction, the numerator of which
shall be the number of days in such Annual Period and the denominator of
which shall be 365.
(v) Without affecting the terms and conditions of
Subdivision III of this Section and in addition thereto, in the event that DBO
has not occurred on or before the fourth (4th) anniversary of the Lease
Commencement Date, then the Second Enplanement Rental shall be abated in full
for the period from and including the fourth (4th) anniversary of the Lease
Commencement Date to and including the day preceding the earlier to occur of DBO
and the fifth (5th) anniversary of the Lease Commencement Date (the earlier to
occur of such date being herein referred to as the "Second Enplanement Rental
Abatement End Date"), provided, however, if DBO has not occurred by the fifth
(5th) anniversary of the Lease Commencement Date, the Lessee may request the
Director of the Aviation Department of the Port Authority (the "Director of
Aviation") that the abatement of the Second Enplanement Rental be extended to
the earlier to occur of DBO and the last day of the sixty-sixth (66th) full
calendar month occurring after the Lease Commencement Date, if the Lessee can
prove to the reasonable satisfaction of the Director of Aviation that failure of
DBO to occur prior to the fifth (5th) anniversary of the Lease Commencement Date
resulted solely from events or circumstances beyond the control of the Lessee.
Such request for extension of the abatement of the Second Enplanement Rental may
be made by the Lessee to the Port Authority at least sixty (60) but not more
than one hundred twenty (120) days prior to the fifth (5th) anniversary of the
Lease Commencement Date if the Lessee's Redevelopment Work Project Schedule
provides for DBO to occur after the fifth (5th) anniversary of the Lease
Commencement Date. Such request shall state in sufficient detail for the
Director of Aviation to reasonably determine that the failure of DBO to occur
prior to the fifth (5th) anniversary of the Lease Commencement Date resulted
solely from events or circumstances beyond the control of the Lessee. In the
event that the Director of Aviation determines that failure of DBO to occur
prior to the fifth (5th) anniversary of the Lease Commencement Date solely
resulted from events or circumstances beyond the control of the Lessee and the
Lessee is in compliance with all of the terms, provisions, covenants and
conditions of this Lease on its part to be kept, performed and observed, then
the Director of Aviation shall notify the Lessee that the Second Enplanement
Rental will continue to be abated until the earlier to occur of DBO and the last
day of the sixty-sixth (66th) full calendar month occurring after the Lease
Commencement Date, which day is herein referred to as the "Extended Second
Enplanement Rental Abatement End Date".
(3) Enplanement Rate Reduction:
(i) The following terms as used herein shall have the respective
meanings given below:
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(aa) "Associated Carrying Costs" shall mean with respect to
each of the Cost of the Passenger Terminal Work, the Cost of the Airside
Civil Work, the Cost of the Parking Garage Work, the Lessee's Shared
Environmental Costs, the Cost of the Landside Civil Work, the Cost of the
MOA Curtain Wall Work, the Cost of the Terminal 5 AirTrain Connector Work
and the Cost of the Building No. 60 AirTrain Connector Work, an amount
equal to the capitalized "Financial Expense" of the Port Authority
attributed to each such cost, as such Financial Expense is computed and
recorded by the Port Authority's accounting system.
(bb) "Cost of the $.01 Work" shall mean an amount equal to
the sum of the Cost of the Passenger Terminal Work and Associated Carrying
Costs, the Cost of the Airside Civil Work and Associated Carrying Costs,
the Cost of the Parking Garage Work and Associated Carrying Costs and the
Lessee's Shared Environmental Costs and Associated Carrying Costs.
(cc) "Cost of the $.008 Work" shall mean an amount equal to
the sum of the Cost of the Landside Civil Work and Associated Carrying
Costs and the Cost of the Terminal 5 AirTrain Connector Work and Associated
Carrying Costs.
(dd) "$.01 Work Cost Savings Sub-total" shall mean the
difference obtained by subtracting the Cost of the MOA Curtain Wall Work
and Associated Carrying Costs from the difference obtained by subtracting
the Cost of the $.01 Work from the amount of Five Hundred Fifty-eight
Million Four Hundred Thousand Dollars and No Cents ($558,400,000.00).
(ee) "$.008 Work Cost Savings Sub-total" shall mean the
difference obtained by subtracting the Cost of the Building No. 60 AirTrain
Connector Work and Associated Carrying Costs in excess of Two Million Five
Hundred Thousand Dollars and No Cents ($2,500,000.00) but not in excess of
Seven Million Five Hundred Thousand Dollars and No Cents ($7,500,000.00),
from the difference obtained by subtracting the Cost of the $.008 Work from
the amount of Ninety-six Million Three Hundred Thousand Dollars and No
Cents ($96,300,000.00).
(ff) "$.01 Work Cost Savings" shall mean the $.01 Work Cost
Savings Sub-total, except if the $.008 Work Cost Savings Sub-total is a
negative amount, the $.01 Work Cost Savings shall mean the sum of $.01 Work
Cost Savings Sub-total and the $.008 Work Cost Savings Sub-total.
(gg) "$.008 Work Cost Savings" shall mean the $.008 Work
Cost Savings Sub-total, except if the $.01 Work Cost Savings Sub-total is a
negative amount, the $.008 Work Cost Savings shall mean the sum of $.008
Work Cost Savings Sub-total and the $.01 Work Cost Savings Sub-total.
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(ii) In the event there is either a $.01 Work Cost Savings or a
$.008 Work Cost Savings, or both, the Per Enplanement Rental Rates set forth in
Exhibit 4.2 shall be subject to reduction as follows:
(aa) The Per Enplanement Rental Rate of $3.45 set forth in
Exhibit 4.2 for the first Annual Period shall be reduced by $.01 for each
entire One Million Dollars and No Cents ($1,000,000.00) of $.01 Work Cost
Savings.
(bb) In addition, the Per Enplanement Rental Rate of $3.45
for the first Annual Period, as the same may have been reduced pursuant to
the operation of subparagraph (aa) above, shall be further reduced by $.008
for each entire One Million
Dollars and No Cents ($1,000,000.00) of $.008 Work Cost Savings (which Per
Enplanement Rental Rate as so adjusted pursuant to this paragraph (b)(3) is
herein referred to as the "Adjusted Per Enplanement Rental Rate"), and such
Adjusted Per Enplanement Rental Rate shall be and become the Per
Enplanement Rental Rate for the First Annual Period, which Adjusted Per
Enplanement Rental Rate for the First Annual Period shall thereafter be
adjusted on an annual basis as hereinafter set forth.
(cc) If the Per Enplanement Rental Rate has been adjusted
pursuant to the provisions of paragraphs (b)(3)(ii)(aa) and/or
(b)(3)(ii)(bb) of this Subdivision II, then the Per Enplanement Rental
Rates for the second Annual Period and for each and every Annual Period
thereafter occurring shall not be the rates set forth in Exhibit 4.2 but
instead shall the rates calculated and increased as follows: For the second
Annual Period and for each Annual Period thereafter occurring to and
including the fifteenth (15th) Annual Period, the Adjusted Per Enplanement
Rental Rate, as the same shall have been increased for the immediately
preceding Annual Period pursuant to this paragraph (b)(3)(ii), shall be
further increased by multiplying the same by 102.5%, and the product so
obtained shall be and become the Per Enplanement Rental Rate for the Annual
Period for which the calculation is being made, and for the sixteenth
(16th) Annual Period and for each Annual Period thereafter, the Adjusted
Per Enplanement Rental Rate, as the same shall have been last increased
pursuant to this paragraph (b)(3)(ii), shall be further increased by
multiplying the same by 102%, and the product so obtained shall be and
become the Per Enplanement Rental Rate for the Annual Period for which the
calculation is being made.
(iii) In the event that either or both of the $.008 Work Cost
Savings and the $.01 Work Cost Savings can not be determined on the Full
Enplanement Rental Commencement Date, the Lessee shall pay to the Port Authority
the Second Enplanement Rental calculated on the basis of the Per Enplanement
Rental Rates set forth in Exhibit 4.2 without reduction as provided for in this
paragraph (b)(3). Upon the earlier to occur of the Final Payment Date and when
both of the $.008 Work Cost Savings and the $.01 Work Cost Savings have been
determined, the Second Enplanement Rentals which have been paid by the Lessee to
the Port Authority shall be recalculated based upon the $.008 Work Cost Savings
and the $.01 Work Cost Savings and the amount of the difference between the
Second Enplanement Rentals which have been paid to the Port Authority and the
amount of such recalculated Second Enplanement Rentals shall be credited against
the Lessee's payment of future Second Enplanement Rentals
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except that for the last such statement required to be rendered after the
expiration of the Term, the Port Authority shall at its election credit such
excess against amounts owed by the Lessee to the Port Authority or pay such
excess to the Lessee.
(4) No Partnership or Joint Venture:
Notwithstanding that the Enplanement Rentals hereunder are
calculated based upon the number of Enplanements, no joint adventure or
partnership relationship between the Lessee and the Port Authority is created by
this Lease.
(c) Additional Rentals:
(1) First Additional Rental:
On the Full Enplanement Rental Commencement Date and on the
first day of each calendar month thereafter occurring up to and including the
first day of the 240th full calendar month occurring subsequent to the Full
Enplanement Rental Commencement Date if the Full Enplanement Rental Commencement
Date shall occur on the first day of a calendar month and, if the Full
Enplanement Rental Commencement Date shall not occur on the first day of a
calendar month, then on the Full Enplanement Rental Commencement Date and on the
first day of each calendar month thereafter occurring up to and including the
first day of the 239th full calendar month occurring subsequent to the Full
Enplanement Rental Commencement Date, the Lessee shall pay to the Port Authority
a monthly rental (the "First Additional Rental") in the amount of Eight Thousand
Three Hundred Thirty-three Dollars and Thirty-Three Cents ($8,333.33), it being
understood that the Lessee shall make a total of 240 payments of First
Additional Rental in a total amount of One Hundred Thousand Dollars and No Cents
($100,000.00) per year for twenty years.
(2) Second Additional Rental:
If the Cost of the Lessee's $80 Million Work shall be less
than Eighty Million Dollars and No Cents ($80,000,000.00) on the Tentative Final
Certificate Date, then on the Tentative Final Certificate Date the Lessee shall
pay to the Port Authority a rental equal to the difference obtained by
subtracting an amount equal to the Lessee's Cost of the Shell Work from the
amount of Eighty Million Dollars and No Cents ($80,000,000.00), which difference
is herein called the "Second Additional Rental".
(3) Third Additional Rental:
(i) The following terms as used herein shall have the
respective meanings given below:
(aa) "Base Percentage" shall mean for each Project
Contingency Payment a percentage equal to the sum derived by adding the
percentage 2.5% to the percentage reported as the weekly index of the Bond
Buyer Revenue Bond Index in the publication "The Bond Buyer" for the week
in which the Payment Date for such Project Contingency Payment occurred.
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(bb) "Monthly Percentage" shall mean with respect to
each Project Contingency Payment, an amount equal to the quotient derived
by dividing the Base Percentage for such Project Contingency Payment by the
whole number twelve (12).
(cc) "Post-DBO Accrued Amount" shall mean with respect
to each Post-DBO Project Contingency Payment, the product obtained by
multiplying such Post-DBO Project Contingency Payment by the amount derived
from the following formula:
n
(1+j) - 1
Where "j" equals the Monthly Percentage, "n" a power that equals the number
of calendar months, both whole and partial, occurring from and including
the last day of the month in which the Payment Date for such Post-DBO
Project Contingency Payment shall have occurred up to and including the
last day of the calendar month immediately preceding the Post-DBO
Additional Rental Commencement Date, both dates inclusive, provided,
however, if such Payment Date for such Post-DBO Project Contingency Payment
shall not be the first day of a calendar month, then the number "1" shall
be subtracted from "n" and a fraction, the numerator of which shall be the
number of days from the Payment Date for such Post-DBO Project Contingency
Payment and the last day of the calendar month in which such Payment Date
occurred, both dates inclusive, and the denominator of which shall be the
number of days in such calendar month, shall be added to "n".
(dd) "Post-DBO Base Factor" shall mean an amount
derived as follows in the following order:
(A) First, the Post-DBO Accrued Amount for each
Post-DBO Project Contingency Payment shall be added to the amount of
such Post-DBO Project Contingency Payment (each such sum being herein
referred to as a "Total Post-DBO Project Contingency Payment"); then
(B) Second, the Total Post-DBO Project Contingency
Payment with respect to such Post-DBO Project Contingency Payment
shall be multiplied by the Base Percentage for such Post-DBO Project
Contingency Payment (each such product so obtained for each Total
Post-DBO Project Contingency Payment being herein referred to as a
"Post-DBO Base Factor Product"); then
(C) Third, all Post-DBO Base Factor Products shall
be added together (the sum being so derived being herein referred to
as the "Sum of the Post-DBO Base Factor Products"); then
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(D) Fourth, the Sum of the Post-DBO Base Factor
Products shall be divided by the Total Post-DBO Amount; then
(E) Fifth, the quotient obtained from the
calculation set forth in the foregoing subparagraph (D) of this
definition shall then be divided by the whole number twelve (12), and
the quotient so obtained shall be the "Post-DBO Base Factor".
(ee) "Post-DBO Project Contingency Payment" shall mean
each Project Contingency Payment made by the Port Authority to the Lessee
on or after the Third Additional Rental Commencement Date up to and
including the day preceding the Post-DBO Additional Rental Commencement
Date.
(ff) "Post-DBO Rental Factor" shall mean the factor
derived in accordance herewith from time to time by application of the
following formula:
i
------------ = Post-DBO Rental Factor
1 - 1
--------
t
(1 + i)
Where "i" equals the Post-DBO Base Factor, "t" a power that equals the
number of whole calendar months occurring from and after the Post-DBO
Additional Rental Commencement Date up to and including the twenty-fifth
(25th) anniversary of the Third Additional Rental Commencement Date, "1" is
the whole number one.
(gg) "Post-DBO Third Additional Rental Amount" shall
mean an amount calculated on a monthly basis equal to the product obtained
by multiplying the Post-DBO Rental Factor by the Total Post-DBO Amount.
(hh) "Pre-DBO Base Factor" shall mean the amount
derived as follows in the following order:
(A) First, the Pre-DBO Payment Accrued Amount for
each Pre-DBO Project Contingency Payment shall be added to the amount
of such Pre-DBO Project Contingency Payment (each such sum being
herein referred to as a "Total Pre-DBO Project Contingency Payment");
then
(B) Second: the Total Pre-DBO Project Contingency
Payment with respect to such Pre-DBO Project Contingency Payment shall
be multiplied by the Base Percentage for such Pre-DBO Project
Contingency Payment (each such product so obtained for each Total
Pre-DBO
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Project Contingency Payment being herein referred to as a "Pre-DBO
Base Factor Product"); then
(C) Third, all Pre-DBO Base Factor Products shall
be added together (the sum being so derived being herein referred to
as the "Sum of the Pre-DBO Base Factor Products"); then
(D) Fourth, the sum of the Pre-DBO Base Factor
Products shall be divided by the Total Pre-DBO Amount; then
(E) Fifth, the quotient obtained from the
calculation made pursuant subparagraph (D) of this definition shall
then be divided by the whole number twelve (12), and the quotient so
obtained shall be the "Pre-DBO Base Factor".
(ii) "Pre-DBO Additional Rental Amount" shall mean an
amount calculated on a monthly basis equal to the product obtained by
multiplying the Pre-DBO Rental Factor by the Total Pre-DBO Amount.
(jj) "Pre-DBO Payment Accrued Amount" shall mean with
respect to each Pre-DBO Project Contingency Payment, the product
obtained by multiplying such Pre-DBO Project Contingency Payment by
the amount derived from the following formula:
n
(1+j) - 1
Where "j" equals the Monthly Percentage, "n" a power that equals the number
of calendar months occurring from and including the last day of the month
in which the Payment Date for such Pre-DBO Project Contingency Payment
shall have occurred up to and including the last day of the calendar month
immediately preceding the Third Additional Rental Commencement Date, both
dates inclusive, provided, however, if such Payment Date for such Pre-DBO
Project Contingency Payment shall not be the first day of a calendar month,
then the number "1" shall be subtracted from "n" and a fraction, the
numerator of which shall be the number of days from the Payment Date for
such Pre-DBO Project Contingency Payment and the last day of the calendar
month in which such Payment Date occurred, both dates inclusive, and the
denominator of which shall be the number of days in such calendar month,
shall be added to "n".
(kk) "Pre-DBO Project Contingency Payment" shall mean
each Project Contingency Payment made by the Port Authority to the Lessee
up to and including the day immediately preceding the Third Additional
Rental Commencement Date.
(ll) "Pre-DBO Rental Factor" shall mean the factor or
factors derived in accordance herewith from time to time by the application
of the following formula:
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i
------------ = Pre-DBO Rental Factor
1 - 1
--------
t
(1 + i)
Where "i" equals the Pre-DBO Base Factor, "t" a power that equals 300, "1"
is the whole number one.
(mm) "Third Additional Rental Commencement Date" shall
be and mean the first to occur of (i) DBO if DBO is the first day of the
month, and if not, then the first day of the calendar month immediately
following DBO and (ii) the fourth anniversary of the Lease Commencement
Date if the Lease Commencement Date is the first day of the month, and if
not, then the first day of the calendar month immediately following the
fourth anniversary of the Lease Commencement Date.
(nn) "Total Post-DBO Amount" shall mean the sum of (x)
the total amount of all Post-DBO Project Contingency Payments and (y) the
total amount of all Post-DBO Accrued Amounts calculated for all Post-DBO
Project Contingency Payments.
(oo) "Total Pre-DBO Amount" shall mean the sum of (x)
the total amount of all Pre-DBO Project Contingency Payments and (y) the
total amount of all Pre-DBO Payment Accrued Amounts calculated for all
Pre-DBO Project Contingency Payments.
(ii) (aa) For the period commencing on the Third Additional
Rental Commencement Date up to and including the day immediately preceding
the twenty-fifth anniversary of the Third Additional Rental Commencement
Date, both dates inclusive, the Lessee shall pay to the Port Authority a
monthly rental in an amount equal to the Pre-DBO Additional Rental Amount
(which monthly rental is herein referred to as the "Pre-DBO Additional
Rental"). The Pre-DBO Additional Rental shall be paid on the Third
Additional Rental Commencement Date and on the first day of each and every
calendar month thereafter occurring to and including the day immediately
preceding the twenty-fifth (25th) anniversary of the Third Additional
Rental Commencement Date.
(bb) For the period commencing the Post-DBO Additional
Rental Commencement Date up to and including the day immediately preceding
the twenty-fifth anniversary of the Third Additional Rental Commencement
Date, both dates inclusive, the Lessee shall pay to the Port Authority a
monthly rental in an amount equal to the Post-DBO Third Additional Rental
Amount (which monthly rental is herein referred to as the "Post-DBO
Additional Rental" and the Post-DBO Additional Rental and the Pre-DBO
Additional Rental are herein collectively referred to as the "Third
Additional Rental"). The Post-DBO Additional Rental shall be paid on the
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Post-DBO Additional Rental Commencement Date and on the first day of each
and every calendar month thereafter occurring to and including the day
immediately preceding the twenty-fifth (25th) anniversary of the Third
Additional Rental Commencement Date.
(iii) Audit Findings:
(aa) In the event that an adjustment is made by the
Port Authority with respect to any Pre-DBO Project Contingency Payment pursuant
to paragraphs (f) or (g) of Section 87 hereof, then the amount of the Pre-DBO
Third Additional Rental Amount shall be recalculated based upon such adjustment.
In addition, there shall be credited against the Lessee's payment of future
Pre-DBO Additional Rentals an amount equal to the difference between the amount
of the Pre-DBO Additional Rentals which the Lessee has paid to the Port
Authority and the amount of the Pre-DBO Additional Rentals as so recalculated.
(bb) In the event that an adjustment is made by the
Port Authority with respect to any Post-DBO Project Contingency Payment pursuant
to paragraphs (f) or (g) of Section 87 hereof, then the amount of the Post-DBO
Third Additional Rental Amount shall be recalculated based upon such adjustment.
In addition, there shall be credited against the Lessee's payment of future
Post-DBO Additional Rentals an amount equal to the difference between the amount
of the Post-DBO Additional Rentals which the Lessee has paid to the Port
Authority and the amount of the Post-DBO Additional Rentals as so recalculated.
(4) Fourth Additional Rental:
(i) The following terms as used herein shall have the
respective meanings given below:
(aa) "Calculated Fourth Additional Rental Amount" shall
mean the quotient obtained by performing the following calculations in the
following order:
(A) First, the total monthly amounts of all Fifth
Ground Rental payable from the Lease Commencement Date through the day
preceding the Fourth Additional Rental Commencement Date shall be
calculated; then
(B) Second, an amount equal to the sum obtained
from the calculation made pursuant to subparagraph (A) of this
definition shall be subtracted from the amount of Eighteen Million
Five Hundred Thousand Dollars and No Cents ($18,500,000.00); then
(C) Third, the difference obtained from the
calculation made pursuant to subparagraph (B) of this definition shall
be divided by the whole number six (6), and the quotient so obtained
shall be the "Calculated Fourth Additional Rental Amount".
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(bb) "Fourth Additional Rental Adjustment" shall mean
an amount equal to the difference obtained by performing the following
calculations in the following order:
(A) First, the Calculated Fourth Additional Rental
Amount shall be multiplied by "t" where "t" equals the number of
calendar months, both whole and partial, from the Fourth Additional
Rental Commencement Date to the Shell Completion Date; then
(B) Second, the product obtained from the
calculation made pursuant to subparagraph (A) of this definition shall
be subtracted from the Fourth Pre-DBO Rental Factor, and the
difference so obtained shall be the "Fourth Additional Rental
Adjustment".
(cc) "Fourth Additional Rental Commencement Date" shall
mean the earlier to occur of (x) February 1, 2008 and (y) the Shell
Completion Date if the Shell Completion Date is on the first day of a
calendar month and if the Shell Completion Date is not on the first day of
a calendar month, then on the first day of the calendar month immediately
following the calendar month in which the Shell Completion Date shall
occur.
(dd) "Fourth Pre-DBO Rental Factor" shall mean the
amount calculated by the application of the following formula:
t+1
(1 + j) - (1 + j)
-------------------- * CFAR = Fourth Pre-DBO Rental Factor
j
Where "j" equals the "Fourth Additional Monthly Percentage" which shall
mean the quotient derived by dividing the percentage equal to the sum
derived by adding the percentage 2.5% to the percentage reported as the
weekly index of the Bond Buyer Revenue Bond Index in the publication "The
Bond Buyer" for the week ending immediately prior to the Fourth Additional
Rental Commencement Date, by the whole number twelve (12), "t" equals the
number of months, both whole and partial, from the Fourth Additional Rental
Commencement Date to the Shell Completion Date, both dates inclusive, and
"CFAR" equals the Calculated Fourth Additional Rental Amount.
(ii) The Lessee shall pay to the Port Authority a Fourth
Additional Rental. The Fourth Additional Rental shall be a monthly rental and
shall be paid, and in an amount calculated, as follows:
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(aa) If the Shell Completion Date occurs on or before
the Fourth Additional Rental Commencement Date, then the Lessee shall make
six payments of Fourth Additional Rental commencing on the Fourth
Additional Rental Commencement Date and on the first day of each and every
calendar month for the first five months occurring thereafter, the Lessee
shall pay to the Port Authority a Fourth Additional Rental in a monthly
amount equal to the Calculated Fourth Additional Rental Amount.
(bb) If the Shell Completion Date has not occurred on
or before the Fourth Additional Rental Commencement Date, commencing on the
Shell Completion Date if the Shell Completion Date is on the first day of a
calendar month and if the Shell Completion Date is not on the first day of
a calendar month, then on the first day of the calendar month immediately
following the calendar month in which the Shell Completion Date shall
occur, and on the first day of each and every calendar month for the first
five months occurring thereafter the Lessee shall pay to the Port Authority
a Fourth Additional Rental in six monthly payments, each such payment to be
in an amount equal to the quotient calculated as follows in the following
order:
(A) First, the amount of Eighteen Million Five
Hundred Thousand Dollars and No Cents ($18,500,000.00) and the amount
of the Fourth Additional Rental Adjustment shall be added together;
(B) Second, an amount equal to the sum of all
Fifth Ground Rental payments made from the Lease Commencement Date
through the Shell Completion Date shall be subtracted from the amount
obtained from the calculation made pursuant to paragraph
(c)(4)(ii)(bb)(A) of this Subdivision II; and
(C) Third, the amount obtained from the
calculation made pursuant to paragraph (c)(4)(ii)(bb)(B) of this
Subdivision II shall be divided by the whole number six (6), and the
quotient so obtained shall be the amount of the Fourth Additional
Rental.
(5) Fifth Additional Rental:
(i) The following terms as used herein shall have the
respective meanings given below:
(aa) "Fifth Accrued Amount" shall mean the product
obtained by multiplying each Fifth Project Contingency Payment by the
amount derived from the following formula:
n
(1+j) - 1
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Where "j" equals the Monthly Percentage as defined in paragraph (c)(3) of
this Subdivision II, "n" a power that equals the number of calendar months
occurring from and including the last day of the month in which the Payment
Date for such Fifth Project Contingency Payment shall have occurred up to
and including the last day of the calendar month in which the Final Payment
Date shall have occurred, both dates inclusive, provided, however, if such
Payment Date for such Fifth Project Contingency Payment shall not be the
first day of a calendar month, then the number "1" shall be subtracted from
"n" and a fraction, the numerator of which shall be the number of days from
the Payment Date for such Fifth Project Contingency Payment and the last
day of the calendar month in which such Payment Date occurred, both dates
inclusive, and the denominator of which shall be the number of days in such
calendar month, shall be added to "n".
(bb) "Fifth Additional Rental Amount" shall mean an
amount calculated on a monthly basis equal to the product obtained by
multiplying the Fifth Rental Factor by the Total Fifth Amount.
(cc) "Fifth Base Factor" shall mean an amount derived
as follows in the following order:
(A) First, the Fifth Accrued Amount for each Fifth
Project Contingency Payment shall be added to the amount of such Fifth
Project Contingency Payment (each such sum being herein referred to as
a "Total Fifth Project Contingency Payment"), then
(B) Second, the Total Fifth Project Contingency
Payment with respect to such Fifth Project Contingency Payment shall
be multiplied by the Base Percentage (as defined in paragraph (c)(3)
of this Subdivision II) for such Fifth Project Contingency Payment
(each such product so obtained for each Total Fifth Project
Contingency Payment being herein referred to as a "Fifth Base Factor
Product"), then
(C) Third, all Fifth Base Factor Products shall be
added together (the sum being so derived being herein referred to as
the "Sum of the Fifth Base Factor Products"), then
(D) Fourth, the Sum of the Fifth Base Factor
Products shall be divided by the Total Fifth Amount, then
(E) Fifth, the quotient obtained from the
calculation performed pursuant to subparagraph (D) of this definition
shall be divided by the whole number twelve (12), and the quotient so
obtained shall be the "Fifth Base Factor".
(dd) "Fifth Project Contingency Payment" shall mean
each Project Contingency Payment made by the Port Authority to the Lessee
on and after
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the Post-DBO Third Additional Rental Commencement Date up to and including
the Final Payment Date.
(ee) "Fifth Rental Factor" shall mean the factor
derived in accordance herewith from time to time by application of the
following formula:
i
------------ = Fifth Rental Factor
1 - 1
--------
t
(1 + i)
Where "i" equals the Fifth Base Factor, "t" a power that equals the number
of whole calendar months occurring from and after the Final Payment Date up
to and including the twenty-fifth (25th) anniversary of the Third
Additional Rental Commencement Date, "1" is the whole number one.
(ff) "Total Fifth Amount" shall mean the sum of (x) the
total amount of all Fifth Project Contingency Payments and (y) the total
amount of all Fifth Accrued Amounts as of Final Payment Date calculated for
all Fifth Project Contingency Payments.
(ii) If the Port Authority has made one or more Fifth
Project Contingency Payments, then for the period commencing on the day after
the Final Payment Date and, if the day after the Final Payment Date is not the
first day of a calendar month, then on the first day of the first full calendar
month occurring after the Final Payment Date up to and including the day
immediately preceding the twenty-fifth anniversary of the Third Additional
Rental Commencement Date, both dates inclusive, the Lessee shall pay to the Port
Authority a monthly rental (the "Fifth Additional Rental") in an amount equal to
the Fifth Additional Rental Amount.
(iii) Audit Findings:
In the event that an adjustment is made by the Port
Authority with respect to any Fifth Project Contingency Payment pursuant to
paragraphs (f) or (g) of Section 87 hereof, then the Fifth Additional Rental
Amount shall be recalculated based upon such adjustment. In addition, there
shall be credited against the Lessee's payment of future Fifth Additional
Rentals an amount equal to the difference between the amount of the Fifth
Additional Rentals which the Lessee has paid to the Port Authority and the
amount of the Fifth Additional Rentals as so recalculated.
(d) In the event that the Bond Buyer or its weekly Bond Buyer Revenue
Bond Index shall be discontinued, such other comparable substitute for such
Index shall be substituted as may be agreed to by the parties hereto. In the
event of the failure of the parties to so agree, the Port Authority may select
and use such index or indexes as it deems appropriate, provided,
104
however, that the foregoing shall not preclude the Lessee from contesting the
Port Authority's selection.
III. Abatement
In the event that the Lessee shall at any time by the provisions of
this Agreement expressly be entitled to abatement of the rentals for the
Premises, said abatement shall be computed as follows (it being understood that
there shall be no abatement of such rentals under the Lease for any portion of
the Premises or any portion of the term except as specifically provided in this
Subdivision III):
(a) First Ground Rental Abatement:
For each square foot of land in the Premises shown in stipple,
stippled diagonal hatching and stippled double parallel vertical hatching on
Exhibit 1.1 the use of which is denied to the Lessee the First Ground Rental
shall be abated as follows:
(1) For the portion of the Term from the Lease Commencement Date
through December 31, 2005, both dates inclusive, at the daily rate of $.0031872;
and
(2) For the portion of the Term from January 1, 2006 to the day
immediately preceding the Second Ground Rental Commencement Date, both dates,
inclusive, at the daily rate of $.0031872 as appropriately adjusted to reflect
any and all adjustments in the First Ground Rental pursuant to paragraph (a) of
Subdivision II of this Section.
(b) Second Ground Rental Abatement:
For each square foot of land in the Premises shown in stipple,
stippled diagonal hatching and stippled double parallel vertical hatching on
Exhibit 1.1 the use of which is denied to the Lessee, the Second Ground Rental
shall be abated as follows:
(1) For the portion of the Term from the Second Ground Rental
Commencement Date, through the first December 31st occurring after the Second
Ground Rental Commencement Date, at the daily rate equal to the quotient
obtained by dividing the Ground Rental Base Rate in effect during the Adjustment
Period during which the Second Ground Rental Commencement Date shall occur by
365 (the "Initial Second Ground Rental Abatement Rate"); and
(2) For the portion of the Term from and after the first January
1st occurring after the Second Ground Rental Commencement Date, at the daily
rate of the Initial Second Ground Rental Abatement Rate as appropriately
adjusted to reflect any and all adjustments in the Second Ground Rental pursuant
to paragraph (a)(2) of Subdivision II of this Section.
(c) Third Ground Rental Abatement:
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For each square foot of land in the Terminal 6 Parcel the use of
which is denied to the Lessee, the Third Ground Rental shall be abated as
follows:
(1) For the portion of the Term from the Terminal 6 Parcel Tender
Date, through the first December 31st occurring after the Terminal 6 Parcel
Tender Date, at the daily rate equal to the quotient obtained by dividing the
Ground Rental Base Rate in effect during the Adjustment Period during which the
Terminal 6 Parcel Tender Date shall occur by 365 (the "Initial Third Ground
Rental Abatement Rate"); and
(2) For the portion of the Term from and after the first January
1st occurring after the Terminal 6 Parcel Effective, at the daily rate of the
Initial Third Ground Rental Abatement Rate as appropriately adjusted to reflect
any and all adjustments in the Third Ground Rentals pursuant to paragraph (a)(3)
of Subdivision II of this Section.
(d) Fourth Ground Rental Abatement:
For each square foot of land in the Premises in the Terminal 4
Parcel the use of which is denied to the Lessee, the Fourth Ground Rental shall
be abated as follows:
(1) For the portion of the Term from the Terminal 4 Parcel Tender
Date, through the first December 31st occurring after the Terminal 4 Parcel
Tender Date, at the daily rate equal to the quotient obtained by dividing the
Ground Rental Base Rate in effect during the Adjustment Period during which the
Terminal 4 Parcel Tender Date shall occur by 365 (the "Initial Fourth Ground
Rental Abatement Rate"); and
(2) For the portion of the Term from and after the first January
1st occurring after the Terminal 4 Parcel Effective, at the daily rate of the
Initial Fourth Ground Rental Abatement Rate as appropriately adjusted to reflect
any and all adjustments in the Fourth Ground Rentals pursuant to paragraph
(a)(4) of Subdivision II of this Section.
(e) Temporary Facility Ground Rental Abatement:
For each square foot of land as shown in stipple and in stippled
crosshatching on Exhibit 2.10 the use of which is denied to the Lessee the
Temporary Facility Ground Rental shall be abated as follows:
(1) For the portion of the Term from the First Temporary
Enplanement Date through December 31, 2005, both dates inclusive, at the daily
rate of $.00537681; and
(2) For the portion of the Term from January 1, 2006 to the day
immediately preceding the Second Ground Rental Commencement Date, both dates,
inclusive, at the daily rate of $.00537681 as appropriately adjusted to reflect
any and all adjustments in the Temporary Facility Ground Rental pursuant to
paragraph (a)(6) of Subdivision II of this Section.
(f) Abatement of the Fifth Ground Rental, the First Enplanement
Rental, the Second Enplanement Rental, the First Additional Rental, the Second
Additional Rental, the
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Third Additional Rental, the Fourth Additional Rental and the Fifth Additional
Rental shall be made on an equitable basis giving effect to the amount, quality
and character of the space the use of which is denied the Lessee as compared
with the total amount of space in the Premises.
VI. For the purposes of this Section, all of the interior space shall be
measured and the same shall be ascertained by measuring between the interior
plaster surfaces of the exterior building walls, and no deductions will be made
therefrom for columns, pilasters, projections, partitions, toilets, vertical
shafts, elevator shafts, stairs, fire towers, vents, pipe shafts, meter closets,
flues, stacks, structures or facilities of any kind or anything else located
therein.
SECTION 5. USE OF PREMISES
(a) From and after DBO, the Lessee, in connection with its business of
transportation by aircraft, may use the Premises for the following purposes and
for activities reasonably required for such purposes and for such purposes and
activities only:
(1) For the reservation of space and the sale of tickets for
transportation on aircraft operated by the Lessee.
(2) For the reservation of space and the sale of tickets for
transportation by other carriers but only as an incident to or in connection
with transportation performed or to be performed by the Lessee or as an incident
to or in connection with the cancellation of such transportation, or for the
accommodation or convenience of the incoming or outbound passengers of the
Lessee at the Airport. The occasional reservation of space and the sale of
tickets for transportation by other carriers shall not be deemed to be
prohibited by this provision.
(3) For the clearance, checking and rendering of service to
passengers of the Lessee and for the furnishing of information service to such
passengers and the general public.
(4) For providing rooms or space for the special handling of or
the furnishing of special services (but not an observation deck unless the
Lessee receives the prior written approval of the Port Authority) to any of its
passengers, guests, or invitees, subject to the provisions of Sections 59, 60,
65 through 68 and 73 through 82 hereof.
(5) For the handling of baggage of passengers of the Lessee
including baggage and parcels such passengers decide to send as air cargo.
(6) For the handling of unclaimed baggage and lost and found
articles.
(7) For the conduct of operations, traffic, communications,
reservations and administrative and executive office functions and activities in
connection with air transportation performed by the Lessee.
(8) For the preparation, packaging and storage of food, beverages
and commissary supplies to be consumed on aircraft operated by the Lessee.
107
(9) For the storage of repair parts, supplies and other personal
property owned or leased by the Lessee and for the performance of minor repairs
to personal property of the Lessee.
(10) For the storage of such automotive fuel and lubricants as
may be approved by the Port Authority.
(11) For the operation of a cafeteria for over-the-counter sales
to officers and employees of the Lessee or of any Subsidiary or Affiliate of the
Lessee and their families and to occasional business guests of such officers and
employees (other than passengers of the Lessee), of food, beverages and other
merchandise normally sold in such an establishment at no profit to the Lessee
and either directly by the Lessee or through a Subsidiary thereof or by an
independent contractor who has received a permit from the Port Authority so to
do.
(12) For use as crew quarters to be used by personnel of the
Lessee during layovers between flights and for the establishment of lounges for
employees of the Lessee.
(13) For the loading and unloading of passengers, baggage, mail,
air cargo and commissary supplies, provided that the use of the Premises for the
unloading and loading of passengers and their baggage from ground transportation
vehicles shall be subject to limitation and restriction, from time to time, as
set forth in Section 58 hereof entitled "Airport Transportation Facilities and
Operations Use of Portions of the Premises" and Section 46 hereof entitled
"Restrictions on Use of Passenger Terminal Frontage Roadways-Use of Airport Taxi
Dispatchers and Roadway Frontage Management" and provided, further, that the
loading and unloading of passengers, baggage, mail, air cargo and commissary
supplies on and off of aircraft shall only be performed at Gates.
(14) For the parking and storage of aircraft and ramp equipment
operated by the Lessee.
(15) For the fueling and servicing of aircraft and ramp equipment
operated by the Lessee and for the maintenance of ramp equipment operated by the
Lessee.
(16) For the performance of aircraft maintenance, subject to the
limitations imposed by paragraph (r) of Section 9 hereof entitled "Prohibited
Acts".
(17) For the training of personnel employed or to be employed by
the Lessee or other Persons engaged in commercial transportation by aircraft,
provided, that unless consented to by the Port Authority, the Lessee shall not
engage in the training of persons employed by others or to be employed by others
if the training of such persons is in competition with any concessionaire,
permittee or licensee of the Port Authority at the Airport (other than another
Person engaged in the business of transportation by aircraft).
(18) For the temporary storage of baggage, mail and air cargo.
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(19) For any other purpose or activity, in addition to those
specified in this Section, for which the Premises are expressly authorized to be
used by any other provision of this Agreement.
(b) The loading or unloading on the Premises of all aircraft used
principally for cargo is expressly prohibited. Further, notwithstanding any
other term or provision of this Lease, including without limitation, any
reference to Handled Airlines, Requesting Airline, Accommodated Handled Airline
or Accommodated Sublessee Airline, it is understood and agreed that the Lessee
is prohibited hereunder from performing any services for any other Aircraft
Operator without the prior written consent of the Port Authority, which consent
the Port Authority shall have no obligation whatsoever to give.
(c) If the Lessee desires to use that portion of the Premises shown in
stippled diagonal hatching on Exhibit 2.10 ("Parcel Z") for the parking and
storage of aircraft and ramp equipment operated by the Lessee and for the
performance of deicing of the aircraft of the Lessee prior to DBO, then the
Lessee shall submit to the Port Authority its plan for such use of Parcel Z
setting forth the Lessee's plan for how such use will not interfere with the use
of the taxilane shown in stippled double parallel hatching on Exhibit 1.1(such
plan as approved by the Port Authority being herein called the "Parcel Z
Approved Plan"). Upon the approval of such plan by the Port Authority, from and
after the date of such approval the Lessee may use Parcel Z in accordance with
the Parcel Z Approved Plan for the parking and storage of aircraft and ramp
equipment operated by the Lessee and for the performance of deicing of the
aircraft of the Lessee, so long as such deicing is not a violation of any
Environmental Requirement or the Port Authority Rules and Regulations, provided,
however, such use shall in no event interfere with the use of the taxilane shown
in stippled double parallel hatching on Exhibit 1.1.
(d) For the period from and after the Temporary Facilities Completion
Date to and including the earlier to occur of DBO and the Terminal Work
Completion Date, the Lessee in connection with its business of transportation by
aircraft may use that portion of the Premises shown in stipple and stippled
crosshatching on Exhibit 2.10 for all of the purposes activities set forth in
paragraph (a) of this Section, except for those purposes and activities set
forth in subparagraphs (2), (4), (11), (12) and (17) of paragraph (a) of this
Section, and for such purposes and activities only.
SECTION 6. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS
(a) The Lessee shall promptly comply with, observe and execute all
laws and ordinances and governmental rules, regulations, orders, requirements
and similar items, including without limitation, all Environmental Requirements
(except as otherwise provided in Section 2(g)(12) and Section 56 hereof), now or
at any time during the term of this Agreement which as a matter of law are
applicable to or which affect (i) the Premises or the groundwater thereunder,
(ii) the operations of the Lessee at the Premises or the Airport, or (iii) the
occupancy and use of the Premises. The Lessee shall, in accordance with and
subject to the provisions of Section 2 hereof entitled "Construction by the
Lessee" or Section 33 hereof entitled "Other Construction of the Lessee", as the
case shall be, make any and all structural and non-structural improvements,
alterations or repairs of the Premises required in order to fully satisfy the
compliance obligations set forth herein.
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(b) The Lessee shall procure from all Governmental Authorities having
jurisdiction over the operations of the Lessee hereunder all licenses,
certificates, permits or other authorization which may be necessary for the
conduct of such operations. "Governmental Authority" shall not be construed as
intending to include The Port Authority of New York and New Jersey, the lessor
under this Agreement.
(c) The obligation of the Lessee to comply with governmental
requirements is provided herein for the purpose of assuring proper safeguards
for the protection of persons and property on the Premises. Such provision is
not to be construed as a submission by the Port Authority to the application to
itself of such requirements or any of them.
(d) Since the Port Authority has agreed in the Basic Lease to conform
to the enactments, ordinances, resolutions and regulations of the City of New
York and its various departments, boards and bureaus in regard to the
construction and maintenance of buildings and structures and in regard to health
and fire protection which would be applicable if the Port Authority were a
private corporation to the extent that the Port Authority finds it practicable
so to do, the Lessee shall comply with all such enactments, ordinances,
resolutions and regulations which would be applicable to its operations
hereunder if the Port Authority were a private corporation, except in cases
where the Port Authority either notifies the Lessee that it need not comply with
or directs it not to comply with any such enactments, ordinances, resolutions or
regulations which are applicable only because of the Port Authority's agreement
in the Basic Lease. The Lessee shall, for the Port Authority's information,
deliver to the Port Authority promptly after receipt of any notice, warning,
summons, or other legal process for the enforcement of any such enactment,
ordinance, resolution or regulation a true copy of the same. Any direction by
the Port Authority to the Lessee not to comply with any such enactment,
ordinance, resolution or regulation shall be given only pursuant to a resolution
duly adopted by the Board of Commissioners of the Port Authority or by an
authorized committee of its Board and if any such direction is given by the Port
Authority to the Lessee, the Port Authority, to the extent that it may lawfully
do so, shall indemnify and hold the Lessee harmless from and against all claims,
actions, damages, liabilities, fines, penalties, costs and expenses suffered or
incurred by the Lessee as a result of non-compliance with such enactment,
ordinance, resolution or regulation.
(e) The Lessee shall have such time within which to comply with the
aforesaid laws, ordinances, rules and regulations as the authorities enforcing
the same shall allow.
(f) Without limiting any other term or condition of this Lease, the
Lessee shall promptly comply with, observe and execute all the terms and
conditions of Sections 3, 4.2.2.1 and 4.2.2.2 of the Remedial Action Work Plan.
SECTION 7. RULES AND REGULATIONS
(a) The Lessee covenants and agrees to observe and obey (and to
require its officers, employees, guests, invitees and those doing business with
it to observe and obey) the existing Rules and Regulations of the Port
Authority, the Airport Standards Manual of the Port
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Authority, and such reasonable future Rules and Regulations and airport
standards of the Port Authority (including amendments and supplements thereto)
for the government of the conduct and operations of the Lessee and others on the
Premises as may from time to time during the letting be promulgated by the Port
Authority for reasons of safety, health, noise, sanitation, good order or
establishing airport standards. The obligation of the Lessee to require such
observance and obedience on the part of its guests, invitees and business
visitors shall obtain only while such Persons are on the Premises. The Port
Authority agrees that except in cases of emergency, it will give notice to the
Lessee of every such future rule, regulation, or airport standard adopted by it
at least ten (10) days before the Lessee shall be required to comply therewith.
(b) The use by the Lessee and its officers, employees, guests,
invitees, sublessees, and those doing business with it, of any and all portions
of the Airport which it may be entitled to use under this Lease (other than
space leased to the Lessee for its exclusive use and the Public Aircraft
Facilities) shall be subject to the Rules and Regulations and Airport Standards
Manual of the Port Authority in effect as of the Effective Date, and such
reasonable future rules and regulations and airport standards (including
amendments and supplements to the existing Rules and Regulations and the Airport
Standards Manual) as the Port Authority may from time to time promulgate in the
public interest and in the interest of health, safety, noise, sanitation, good
order and the economic and efficient operation of the Airport, including but not
limited to, the number and type of aircraft which at any particular time may use
the Public Aircraft Facilities and the time or times when such aircraft may use
the Public Aircraft Facilities. Without limiting the foregoing, the Port
Authority may take into account in adopting such Rules and Regulations the
adequacy, capacity and suitability of (i) aircraft using the Airport, (ii)
passenger handling facilities at the Airport including but not limited to the
AirTrain, (iii) the Public Aircraft Facilities at the Airport, (iv) the roadways
and (v) the parking facilities. In the event the Port Authority promulgates
rules and regulations and/or airport standards pursuant to this paragraph (b),
the Port Authority may devise and implement reasonable procedures including but
not limited to, allocations among Aircraft Operators at the Airport.
(c) If a copy of the Rules and Regulations and the Airport Standards
Manual is not attached, then the Port Authority will notify the Lessee thereof
either by delivery of a copy, or by making a copy available at the office of the
Secretary of the Port Authority.
SECTION 8. VARIOUS OBLIGATIONS OF THE LESSEE
(a) The Lessee shall conduct its operations hereunder in an orderly
and proper manner, so as not to unreasonably annoy, disturb or be offensive to
others at or off the Airport. The Lessee shall take all reasonable measures to
eliminate vibrations originating on the Premises tending to damage any
equipment, structure, building or portion of a building which is on the
Premises, or is a part thereof, or is located elsewhere on or off the Airport.
(b) The Lessee shall use its best efforts to conduct all its
operations at the Premises in a safe and careful manner, following in all
respects the best practices of the Lessee's industry in the United States.
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(c) If requested by the Port Authority the Lessee shall supply and
shall require its employees to wear or carry badges or other suitable means of
identification, which shall be subject to the prior and continuing approval of
the General Manager of the Airport.
(d) The Lessee shall control all vehicular traffic on the roadways or
other areas within the Premises or serving the same the use of which is granted
to the Lessee hereunder and shall take all precautions reasonably necessary to
promote the safety of its passengers and all other persons. The Lessee shall
employ such means as may be necessary to direct the movement of vehicular
traffic within the Premises to prevent traffic congestion on the public roadways
leading to the Premises.
(e) The Lessee shall remove from the Airport or otherwise dispose of
in a manner approved by the General Manager of the Airport all garbage, debris
and other waste materials (whether solid or liquid) arising out of its occupancy
of the Premises or out of its operations at the Airport. Any such waste material
which may be temporarily stored in the open, shall be kept in suitable garbage
and waste receptacles, the same to be made of metal or other suitable material,
and equipped with tight fitting covers, and to be of a design safely and
properly to contain whatever material may be placed therein. The Lessee shall
use extreme care when effecting removal of all such waste materials, and shall
effect such removal at such times and by such means as first approved by the
Port Authority. No such garbage, debris or other waste materials shall be or be
permitted to be thrown, discharged or deposited into or upon the waters at or
bounding the Airport.
(f) From time to time and as often as reasonably required by the Port
Authority, the Lessee shall conduct pressure, water-flow, and other appropriate
tests of the fire extinguishing system and apparatus, fire-alarm and smoke
detection systems and any other fire protection systems which constitute a part
of the Premises. The Lessee shall keep in proper functioning order all
fire-fighting equipment, fire-alarm and smoke detection equipment on the
Premises and the Lessee shall at all times maintain on the Premises adequate
stocks of fresh, usable chemicals for use in such systems, equipment and
apparatus. The Lessee shall notify the Port Authority prior to conducting such
tests. If requested by the Port Authority, the Lessee shall furnish the Port
Authority with a copy of written reports of such tests.
(g) In addition to compliance by the Lessee with all laws, ordinances,
governmental rules, regulations and orders now or at any time in effect during
the term of the letting hereunder which as a matter of law are applicable to the
operation, use or maintenance by the Lessee of the Premises or the operations of
the Lessee under this Agreement (the foregoing not to be construed as a
submission by the Port Authority to the application to itself of such
requirements or any of them), the Lessee agrees that it shall exercise the
highest degree of safety and care and shall conduct all its operations under
this Lease and shall operate and maintain the Premises and shall use the
Premises in accordance with the highest standards and in such manner that there
will be at all times a minimum of air pollution, water pollution or any other
type of pollution and a minimum of noise emanating from, arising out of or
resulting from the operation, use or maintenance of the Premises by the Lessee
and from the operations of the Lessee under this Agreement. The Port Authority
hereby reserves the right from time to time and at any time during the term of
this Lease to require the Lessee, and the Lessee agrees to design and construct
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at its sole cost and expense such reasonable structures, fences, equipment,
devices and other facilities as may be necessary or appropriate to accomplish
the objectives as set forth in the first sentence of this paragraph. All
locations, the manner, type and method of construction and the size of any of
the foregoing shall be determined by the Port Authority. The Lessee shall submit
for Port Authority approval its plans and specifications covering the required
work and upon receiving such approval shall proceed diligently to construct the
same. The obligations assumed by the Lessee under this paragraph shall continue
throughout the term of this Lease and shall not be limited, affected, impaired
or in any manner modified by the fact that the Port Authority shall have
approved any construction application and supporting plans, specifications and
contracts covering construction work and notwithstanding the incorporation
therein of the Port Authority's recommendations or requirements and
notwithstanding that the Port Authority may have at any time during the term of
the Lease consented to or approved any particular procedure or method of
operation which the Lessee may have proposed or the Port Authority may have
itself prescribed the use of any procedure or method. The agreement of the
Lessee to assume the obligations under this paragraph is a special inducement
and consideration to the Port Authority in entering into this Lease with the
Lessee.
(h) The Lessee shall periodically inspect, clean out and maintain the
oil separators serving the Premises which are located on the Premises and the
oil separators located outside the Premises if they exclusively serve the
Premises.
(i) It is the intention of the parties hereto that noise caused by
aircraft engine operations shall be held to a minimum considering the nature of
the Lessee's operations. To this end the Lessee will conduct its operations in
such a manner as to keep the noise produced by aircraft engines to a minimum and
where appropriate shall employ noise arresting and noise reducing devices that
are suitable. Aircraft testing and aircraft run-ups will be conducted only in
such areas as shall meet with the prior and continuing approval of the Port
Authority. The obligations assumed by the Lessee under this paragraph (i) shall
not diminish, limit, modify or affect all other obligations of the Lessee with
respect to noise under this Agreement.
(j) In its use of the Premises, the Lessee shall use its best efforts
to minimize jet or prop blast interference to aircraft operating on or to
buildings and structures now located on or which in the future may be located on
areas adjacent to the Premises. In the event the Port Authority determines at
any time and from time to time that the Lessee has not so minimized the jet or
prop blast interference, it may serve a notice on the Lessee to such effect and
if the condition is not corrected to the satisfaction of the Port Authority
within thirty (30) days after the service of said notice, the Lessee hereby
covenants and agrees to erect and maintain at its own expense such structure or
structures as may be necessary to minimize the said jet or prop blast
interference, subject, however, to the prior written approval of the Port
Authority as to the type, manner and method of construction. The obligations
assumed by the Lessee under this paragraph shall not diminish, limit, modify or
affect all other obligations of the Lessee with respect to interference under
this Agreement.
SECTION 9. PROHIBITED ACTS
(a) The Lessee shall commit no unlawful nuisance, waste or injury on
the Premises or at the Airport, and shall not do or permit to be done anything
which may result in the
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creation or commission or maintenance of such nuisance, waste or injury on the
Premises or at the Airport.
(b) The Lessee shall not create nor permit to be caused or created
upon the Premises any obnoxious odors or smokes, or noxious gases or vapors. The
creation of exhaust fumes by the operation of the Lessee's internal-combustion
engines or aircraft engines of other types, so long as such engines are
maintained and are being operated in a proper manner, shall not be a violation
of this paragraph.
(c) The Lessee shall not do or permit to be done anything which may
interfere with the effectiveness or accessibility of the drainage and sewerage
system, water system, communications system, electrical fire-protection system,
sprinkler system, alarm system, fire hydrants and hoses and other systems, if
any, installed or located on, under, or in the Premises.
(d) The Lessee shall not do or permit to be done any act or thing upon
the Premises (1) which will invalidate or conflict with any fire insurance,
extended coverage or rental insurance policies covering the Premises or any part
thereof, or the Airport, or any part thereof, or (2) which, in the opinion of
the Port Authority, may constitute an extra-hazardous condition, so as to
increase the risks normally attendant upon the operations contemplated by
Section 5 hereof entitled "Use of Premises". The Lessee shall promptly observe,
comply with and execute the provisions of any and all present and future rules
and regulations, requirements, orders and directions of the National Board of
Fire Underwriters and the Fire Insurance Rating Organization of New York, or of
any other board or organization exercising or which may exercise similar
functions, which may pertain or apply to the operations of the Lessee on the
Premises, and the Lessee shall, subject to and in accordance with the provisions
of Section 33 hereof entitled "Other Construction by the Lessee", make any and
all structural and non-structural improvements, alterations or repairs of the
Premises that may be required at any time hereafter by any such present or
future rule, regulation, requirement, order or direction. If by reason of any
failure on the part of the Lessee to comply with the provisions of this
paragraph any fire insurance rate, extended coverage or rental insurance rate on
the Premises or any part thereof, or on the Airport or any part thereof, shall
at any time be higher than it would be if the Premises were properly used for
the purposes permitted by Section 5 hereof entitled "Use of Premises", then the
Lessee shall pay to the Port Authority, as an item of additional rental, that
part of all insurance premiums paid by the Port Authority which shall have been
charged because of such violation or failure by the Lessee.
(e) The Lessee agrees that it will not erect, construct or maintain or
otherwise create or continue any obstacle or so park or store any aircraft or
other object on the Premises so as to create any obstacle that will hamper or
interfere with the free, orderly, unobstructed and uninterrupted passage of
vehicles, aircraft or of the wings or other integral part of aircraft of any
type, nature or description, while such vehicle is operating or aircraft is
taxiing or being transported or towed along the runways, taxiways and roads
outside of and adjacent to the Premises.
(f) The Lessee shall not keep or store during any 24-hour period
flammable liquids within any enclosed portion of the Premises (other than in
rooms or areas expressly
114
constructed for the storage of such liquids) in excess of the Lessee's working
requirements during the said 24-hour period. Any such liquids having a flash
point of less than 110 DEG. F. shall be kept and stored in safety containers of
a type approved by the Underwriters Laboratories or the Factory Mutual Insurance
Association.
(g) The Lessee shall not operate any engine or any item of automotive
equipment in any enclosed space on the Premises unless such space is adequately
ventilated and unless such engine is equipped with a proper spark-arresting
device which has been approved by the Port Authority.
(h) The Lessee shall not do or permit anything to be done which will
interfere with the free access and passage of others to space adjacent to the
Premises or in any streets, ways and walks adjacent or near the Premises.
(i) The Lessee shall not overload any floor and shall repair any
floor, including supporting members, and any paved area damaged by overloading.
Nothing in this paragraph or elsewhere in this Agreement shall be or be
construed to be a representation by the Port Authority of the weight any floor
or paved area will bear.
(j) The Lessee shall not use or permit the use of any structural
supporting member of the buildings or roofs or any part thereof for the storage
of any material or equipment, or hoist, lift, move or support any material or
equipment or other weight or load, by means of said trusses or structural
supporting members, without prior approval of the Port Authority.
(k) The Lessee shall not use any cleaning materials having a harmful
corrosive effect, on any part of the Premises.
(l) The Lessee shall not fuel or defuel any equipment in the enclosed
portions of the Premises without prior approval of the General Manager of the
Airport.
(m) The Lessee shall not dispose of, release or discharge nor permit
anyone to dispose of, release or discharge any Hazardous Substance on the
Premises or at the Airport, provided, however, that the redepositing of soil in
compliance with Section 2 hereof in the performance of the Construction Work
shall not be or be deemed to be a breach of this paragraph (m).
(n) (1) The Lessee shall prevent access by persons or vehicles (unless
duly authorized by the Port Authority) to the Public Landing Area from the
Premises except for aircraft, which aircraft shall be equipped with radio
receivers tuned to control tower frequencies and adequately manned in accordance
with applicable Port Authority Rules and Regulations. Such aircraft may be towed
by a motor vehicle equipped with a radio receiver tuned to the appropriate
control tower frequency and adequately manned or such other means as may be
approved by the Port Authority. The Lessee shall control access by its
passengers and patrons from and to aircraft ramp, apron and parking areas on the
Premises and shall maintain control of its passengers and patrons while they are
upon said areas by proper measures to insure that the highest standards of
safety are maintained.
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(2) The Lessee shall furnish adequate security and guard service
or such comparable means as approved by the Port Authority from time to time, on
a 24 hour, seven day-a-week basis for the prevention of access to and control of
persons on the aeronautical operations areas of the Premises and the prevention
of access to the Public Landing Area.
(o) The Lessee shall not operate or cause to be operated aircraft
engines in any portions of the Premises other than for the purpose of taxiing
aircraft to and from the Premises or in connection with authorized aircraft
maintenance on the Premises.
(p) The Lessee shall not keep or store aviation fuel on the Premises
except that fueling equipment may be operated on the Premises in accordance with
the provisions of the Airport Fueling Agreements covering the underground
fueling system and with the Port Authority Rules and Regulations pertaining
thereto.
(q) The Lessee shall not do or permit anything to be done which will
interfere with the free access and passage of others to space adjacent to the
Premises or in any streets, ways and walks adjacent or near the Premises.
(r) The Lessee shall not perform any aircraft maintenance on the
Premises except that emergency aircraft maintenance and transit or turn around
aircraft maintenance shall not be deemed to be prohibited by this provision.
SECTION 10. CARE, MAINTENANCE, REBUILDING AND REPAIR BY THE LESSEE
(a) The Lessee shall repair, replace, rebuild and paint all or any
part of the Premises which may be damaged or destroyed by the acts or omissions
of the Lessee or by those of its officers or employees or of other persons on or
at the Premises with the Lessee's consent and shall pay to the Port Authority
the costs and expenses of the Port Authority to repair, replace, rebuild and
paint all or any part of the Airport which may be damaged or destroyed by the
acts or omissions of the Lessee or by those of its officers or employees or of
other Persons on or at the Premises with the Lessee's consent but as to areas
outside of the Premises only by the acts or omissions of the Lessee and its
officers or employees, provided, however, the foregoing obligations of the
Lessee shall not apply to the repair of damage to the Premises caused solely by
the Port Authority in the exercise of its rights under paragraph (l) of Section
56 hereof.
(b) Except for the restoration of any excavation, demolition or other
damage to the Premises resulting as part of the Utility Servicing (as defined in
Section 17 hereof) to its original state by the Port Authority as required by
Section 17(b) hereof, the Lessee shall, throughout the term of this Lease,
assume the entire responsibility and shall relieve the Port Authority from all
responsibility for all repair, rebuilding and maintenance whatsoever in the
Premises, whether such repair, rebuilding or maintenance be ordinary or
extraordinary, partial or entire, inside or outside, foreseen or unforeseen,
structural or otherwise, and without limiting the generality of the foregoing,
the Lessee shall:
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(1) Keep at all times in a clean and orderly condition and
appearance, the Premises and all the Lessee's fixtures, equipment and personal
property which are located in any part of the Premises which is open to or
visible by the general public;
(2) Remove all snow and ice and perform all other activities and
functions necessary or proper to make the Premises available for use by the
Lessee;
(3) Take good care of the Premises and maintain the same at all
times in good condition except for reasonable wear and tear which does not
adversely affect the proper utilization of the Premises; perform all necessary
preventive maintenance, including but not limited to painting (the exterior of
the Premises and areas visible to the general public to be painted only in
colors which have been approved by the Port Authority); and make all repairs and
replacements, and do all rebuilding, inside and outside, ordinary and
extraordinary, partial and entire, foreseen and unforeseen, structural or
otherwise, which repairs, rebuilding and replacements by the Lessee shall be in
quality and class not inferior to the original in materials and workmanship;
(4) Provide and maintain all obstruction lights and similar
devices on the Premises and provide and maintain all fire protection and safety
equipment and all other equipment of every kind and nature required by any law,
rule, ordinance, resolution or regulation of the type and nature described in
Section 6 hereof entitled "Compliance with Governmental Requirements" and
Section 7 hereof entitled "Rules and Regulations". The Lessee shall enter into
and keep in effect throughout the term of the Lease a contract or contracts with
a central station alarm company acceptable to the Port Authority to provide
continuous and automatic surveillance of the fire protection system on the
Premises. The Lessee shall insure that all fire alarm signals with respect to
the Premises shall also be transmitted to the Airport's police emergency alarm
board or to such other location on the Airport as the General Manager of the
Airport may direct. The Lessee's obligations hereunder shall in no way create
any obligation whatsoever on the part of the Port Authority;
(5) Take such anti-erosion measures and maintain the landscaping
at all times in good condition, including but not limited to periodic
replanting, as the Port Authority may require, and perform and maintain such
other landscaping with respect to all portions of the Premises not paved or
built upon as the Port Authority may require;
(6) Be responsible for the maintenance and repair of all utility
service lines, including but not limited to, service lines for the supply of
water, electric power and telephone conduits and lines, sanitary sewers and
storm sewers, located upon the Premises or located adjacent to the Premises and
exclusively serving the Premises;
(7) Be responsible for the maintenance and repair of any damage
to the paving or other surface of the Premises caused by any oil, gasoline,
grease, lubricants or other flammable liquids and substances having a corrosive
or detrimental effect thereon;
(8) Be responsible for all paving, line-stripping, lighting,
signage, storm drains, culverts, cables, supporting structures, cleaning and
snow removal in connection
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with existing and future access roadways which are located off of the Premises
and serve the Premises exclusively;
(9) Be responsible for the operation, maintenance, repair and
replacement of building systems located on the Premises that serve the Flight
Wing I Tube, and
(10) If any of the area shown in stippled double parallel
vertical hatching on Exhibit 1.1 shall be repaved, such pavement and any related
or required work shall be performed so that the taxilanes on such area can
accommodate use by Group VI aircraft.
(c) In the event the Lessee fails to commence so to maintain, clean,
repair, replace, rebuild or paint within a period of twenty (20) days after
notice from the Port Authority so to do in the event that the said notice
specifies that the required work to be accomplished by the Lessee includes
maintenance and/or repair other than preventive maintenance; or within a period
of one hundred eighty (180) days if the said notice specifies that the work to
be accomplished by the Lessee involves preventive maintenance only, or fails
diligently to continue to completion the repair, replacement, rebuilding or
painting of all of the Premises required to be repaired, replaced, rebuilt or
painted by the Lessee under the terms of this Agreement, the Port Authority may,
at its option, and in addition to any other remedies which may be available to
it, repair, replace, rebuild or paint all or any part of the Premises included
in the said notice, and the cost thereof shall be payable by the Lessee upon
demand.
(d) Notwithstanding the terms and conditions of Section 5 of this
Lease entitled "Use of Premises", paragraph (d) of Section 8 of this Lease
entitled "Various Obligations of the Lessee" and this Section, it is hereby
agreed and understood, the Lessee shall have no right nor obligation to operate,
control, maintain, rebuild or repair (i) the traffic signaling system located on
the roadway frontage of the Premises and the roadways located off the Premises
and generally consists of traffic lights and signals and associated wiring and
control panels, or (ii) the variable message sign system located on the roadway
frontage of the Premises and the roadways located off the Premises and generally
consists of message signs, lights, wiring and control panels (which traffic
signaling system and variable message sign system are hereinafter collectively
called the "Traffic Systems"), provided, however, the Lessee shall pay to the
Port Authority as additional rent all costs and expenses to repair, replace and
rebuild all or any portion of the Traffic Systems which may be damaged or
destroyed by the acts or omissions of the Lessee or by those of its officers or
employees or of other Persons on or at the Premises. Further, the Port Authority
shall not have any obligation hereunder or otherwise to operate, maintain,
control or continue the operation of the Traffic Systems and may at any time and
from time to time discontinue the operation of any or all of the Traffic Systems
and/or disable such Traffic Systems and/or remove them from the Premises and
from the roadways located off of the Premises. The Port Authority shall have the
right at its sole discretion to modify, replace and substitute the Traffic
Systems with identical or different systems as the Port Authority shall elect
and to operate and control the Traffic Systems, including without limitation, to
determine the content of and to place messages on the variable message system
and to determine the operating mode of the traffic signaling system.
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(e) If the performance of any of the foregoing repair, maintenance,
replacement, repainting or rebuilding obligations of the Lessee requires work to
be performed near an active taxiway or taxilane or where safety of operations is
involved, the Lessee agrees, unless otherwise permitted by the Port Authority in
writing, that it will, at its own expense, post guards or take such other
appropriate measures as may be directed by the General Manager of the Airport to
insure the safety of the work performed thereat.
SECTION 11. INSURANCE
(a) The Lessee shall, during the term of this Agreement, insure and
keep insured to the extent of 100% of the replacement value thereof, the entire
Premises and all other buildings, structures, improvements, installations,
facilities and fixtures now or in the future located on the Premises against all
risks of physical loss or damage (including, but not limited to flood and
earthquake risks if commercially available), if available, and if not available,
then against such hazards and risks as may now or in the future be included
under the Standard Form of Fire Insurance Policy of the State of New York and
also against damage or loss by windstorm, cyclone, tornado, hail, explosion,
riot, civil commotion, aircraft, vehicles and smoke, under the Standard Form of
Fire Insurance Policy of New York and the form of extended coverage endorsement
prescribed as of the effective date of the said insurance by the rating
organization having jurisdiction, and if the Port Authority so requests, also
covering contamination hazards and, if the Premises contains a boiler, then
boiler and machinery hazards and risks, in a separate insurance policy or
policies or as an additional coverage endorsement to the aforesaid policies in
the form as may now or in the future be prescribed as of the effective date of
said insurance by the rating organization having jurisdiction and/or the
Superintendent of Insurance of the State of New York and the Lessee shall
furthermore provide additional insurance covering any other peril of loss or
damage that the Port Authority at any time during the term of this Agreement
covers by carrier or self-insurance covered by appropriate reserves at other
locations at the Airport upon ninety days' (90) written notice to the Lessee to
such effect.
(b) The aforesaid insurance coverages and renewals thereof shall
insure the Port Authority, the Lessee and the City of New York, as insureds, as
their interests may appear, and shall provide that the loss, if any, shall be
adjusted with and payable to the Port Authority.
(c) In the event the Premises or any part thereof shall be damaged by
any casualty against which insurance is carried pursuant to this Section, the
Lessee shall promptly furnish to the Port Authority such information and data as
may be necessary to enable the Port Authority to adjust the loss.
(d) The policies or certificates representing insurance covered by
this Section shall, if not already delivered, shall be delivered by the Lessee
to the Port Authority prior to the Lease Commencement Date and each policy or
certificate delivered shall bear the endorsement of or be accompanied by
evidence of payment of the premium thereon, and also shall contain a valid
provision obligating the insurance company to furnish the Port Authority and the
City of New York thirty (30) days' advance notice of the cancellation or
termination of the insurance evidenced by said policy or certificate and that
the policy may not be changed or modified in any way that would affect the Port
Authority or the City of New York without giving thirty (30) days' written
advance notice thereof to the Port Authority and the City of New York. Renewal
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policies or certificates shall be delivered to the Port Authority before the
expiration of the insurance which such policies are to renew.
(e) Regardless, however, of the Persons whose interests are insured,
the proceeds of all policies covered by this Section shall be applied as
provided in Section 12 hereof entitled "Damage to or Destruction of the
Premises"; and the word "insurance" and all other references to insurance in
said Section 12 shall be construed to refer to the insurance which is the
subject matter of this Section, and to refer to such insurance only.
(f) The insurance covered by this Section shall be written by
companies approved by the Port Authority, the Port Authority covenanting and
agreeing not to withhold its approval unreasonably. If at any time any of the
insurance policies shall be or become unsatisfactory to the Port Authority as to
form or substance or if any of the carriers issuing such policies shall be or
become unsatisfactory to the Port Authority, the Lessee shall promptly obtain a
new and satisfactory policy in replacement, the Port Authority covenanting and
agreeing not to act unreasonably hereunder. If at any time the Port Authority so
requests, a certified copy of each of said policies shall be made available by
the Lessee to the Port Authority for inspection and reproduction at an office of
the Lessee within the Port of New York District.
SECTION 12. DAMAGE TO OR DESTRUCTION OF THE PREMISES
(a) Removal of Debris. If the Premises or any part thereof, shall be
damaged by fire, the elements, the public enemy or other casualty, the Lessee
shall promptly remove all debris resulting from such damage from the Premises,
and to the extent, if any, that the removal of debris under such circumstances
is covered by insurance, the proceeds thereof shall be made available to and be
used by the Lessee for such purpose.
(b) Minor Damage. If the Premises or any part thereof, shall be
damaged by fire, the elements, the public enemy or other casualty but not
rendered untenantable or unusable for a period of ninety (90) days, the Premises
shall be repaired with due diligence in accordance with the plans and
specifications for the Premises as they existed prior to such damage by and at
the expense of the Lessee and if such damage is covered by insurance the
proceeds thereof shall be made available by the Port Authority to and be used by
the Lessee for that purpose.
(c) Major Damage to or Destruction of the Premises. If the Premises or
any part thereof, shall be destroyed or so damaged by fire, the elements, the
public enemy or other casualty as to be untenantable or unusable for ninety (90)
days, or if within ninety (90) days after such damage or destruction the Lessee
notifies the Port Authority in writing that in its opinion said Premises as the
case shall be, will be untenantable or unusable for ninety (90) days then the
Lessee shall proceed with due diligence to make the necessary repairs or
replacements to restore the Premises in accordance with the plans and
specifications for the Premises as the same existed prior to such damage or
destruction; or with the approval in writing of the Port Authority make such
other repairs, replacements or changes as may be desired by the Lessee. If such
destruction or damage was covered by insurance, the proceeds thereof shall be
made available by the Port Authority to and used by the Lessee for such
restoration.
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(d) The obligation of the Lessee to repair or replace shall be limited
to the amount of the insurance proceeds provided the Lessee has carried
insurance to the extent and in accordance with Section 11 hereof entitled
"Insurance". Any excess of the proceeds of insurance over the costs of the
restoration shall be retained by the Port Authority.
(e) The parties hereby stipulate that neither the provisions of
Section 227 of the Real Property Law of New York nor those of any other similar
statute shall extend or apply to this Agreement.
SECTION 13. INDEMNITY AND LIABILITY INSURANCE
(a) (1) The Lessee shall indemnify and hold harmless the Port
Authority, its Commissioners, officers, employees and representatives (each of
the foregoing being hereinafter singularly referred to as an "Indemnified
Party"), from and against (and shall reimburse each Indemnified Party for its
costs and expenses including legal expenses, whether those of the Port
Authority's Law Department or otherwise, incurred in connection with the defense
of) all claims and demands of third persons including, but not limited to,
claims and demands for death or personal injuries, or for property damages,
arising out of a breach or default of any term or provision of this Agreement by
other than the Port Authority, or out of the use or occupancy of the Premises by
the Lessee or by others with its consent, or out of any other acts or omissions
of the Lessee, its officers, employees, guests, representatives, customers,
contractors, invitees or business visitors on the Premises, or arising out of
the acts or omissions of the Lessee, its officers and employees elsewhere at the
Airport (excepting only claims and demands arising solely from the willful
misconduct or the sole negligence of the Port Authority), including claims and
demands of the City of New York from which the Port Authority derives its rights
in the Airport, for indemnification, arising by operation of law or through
agreement of the Port Authority with the said City (excepting claims and demands
of the City arising solely with respect to the Condition Exceptions which the
Lessee is not responsible for pursuant to paragraph (b)(2) of Section 56 hereof
and claims and demands of the City arising solely with respect to those terms
and conditions of the Remedial Action Work Plan which the Lessee is not
responsible for complying with pursuant this Lease)(each and every claim or
demand for which the Lessee has agreed to indemnify an Indemnified Party
pursuant to this paragraph (a)(1) being hereinafter called as "Indemnified
Claim").
(2) (i) Except as set forth in subparagraph (a)(2)(ii) of this
Section, the Lessee shall at its own cost and expense defend each and every suit
based upon any Indemnified Claim (even if such claim or demand is groundless,
false or fraudulent) with counsel reasonable satisfactory to the Port Authority,
and in defending such suit the Lessee shall not, without obtaining express
advance permission from the General Counsel of the Port Authority, raise any
defense involving in any way the jurisdiction of the tribunal over the person of
the Port Authority, the immunity of the Port Authority, its Commissioners,
officers, agents or employees, the governmental nature of the Port Authority, or
the provisions of any statutes respecting suits against the Port Authority,
provided, however, the Port Authority shall have the right at its election to
either (x) participate in such defense or settlement with its own counsel and at
its sole expense except as set forth in subparagraph (a)(2)(ii) of this Section,
but the Lessee shall have the control of the defense, judgment and settlement or
(y) upon notice to the Lessee relieve the Lessee from the obligation to defend
any Indemnified Claim and itself defend such Indemnified
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Claim at its sole cost and expense except as set forth in subparagraph
(a)(2)(ii) of this Section and the settlement, judgment and satisfaction thereof
shall be paid by the Lessee if the Lessee has consented to such settlement,
judgment or satisfaction, which consent of the Lessee will not be unreasonably
withheld.
(ii) In the event that the defense of an Indemnified Claim
which is to be provided by the Lessee (including without limitation any defense
provided by the Lessee's insurer, contractor or subcontractor) has not been
commenced within a reasonable time period after receipt by the Lessee of notice
of such Indemnified Claim, or if the Lessee, one of its contractors or
subcontractors or its insurer shall not use a counsel that is reasonably
satisfactory to the Port Authority in defending an Indemnified Claim, then upon
notice to the Lessee the Port Authority may defend such Indemnified Claim at the
sole cost and expense of the Lessee.
(iii) The Port Authority and the Lessee will reasonably
cooperate with each other in the defense of any Indemnified Claim.
(iv) In the event that the Lessee (including any of its
insurance carriers, contractors or subcontractors involved in the defense of an
Indemnified Claim) has a conflict of interest with the Port Authority or an
Indemnified Party or a defense by the Lessee (including without limitation a
defense by the Lessee's insurer, contractor or subcontractor) adversely affects
the interests of the Port Authority or other Indemnified Party, then Lessee
shall provide or cause to be provided separate counsel approved by the Port
Authority to defend such Indemnified Claim.
(b) (1) In addition to the obligations set forth in paragraph (a) of
this Section and all other insurance required under this Agreement, the Lessee
during the term of this Agreement in its own name as insured and also including
the Port Authority, the other Indemnified Parties and the City Insureds as
additional insureds including without limitation for premises-operations and
products-completed operations, shall maintain and pay the premiums on a policy
or policies of (i) Commercial General Liability Insurance, and covering bodily
injury, including death, and property damage liability, broadened to include or
equivalent separate policies covering aircraft liability, none of the foregoing
to contain care, custody or control exclusions, and providing for coverage in
the limits set forth below, and (ii) Commercial Automobile Liability Insurance
covering owned, non-owned and hired vehicles and automatically covering newly
acquired vehicles in not less than the minimum limit set forth below and in lieu
of the foregoing requirements pertaining to care, custody or control exclusions
Baggage Legal Liability Insurance providing for coverage in not less than the
limit set forth below. Said policy of Baggage Legal Liability Insurance shall
cover and insure against such hazards and risks as are customarily insured under
such a policy, shall cover the operations of the Lessee under this Lease, shall
be effective throughout the term of the letting hereunder, and shall contain an
endorsement waiving any rights of subrogation of the insurer against the Port
Authority. In addition, each of the said policy or policies of insurance shall
also provide or contain an endorsement providing that the protections afforded
the Lessee thereunder with respect to any claim or action against the Lessee by
a third person shall pertain and apply with like effect with respect to any
claim or action against the Lessee by the Port Authority and any claim or action
against the Port Authority by the Lessee as though the Port Authority were a
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named insured but such endorsement shall not limit, vary, change, or affect the
protection afforded the Port Authority thereunder as an additional insured. In
addition, the said policy or policies of Commercial General Liability Insurance
shall also provide or contain a contractual liability endorsement covering the
obligations assumed by the Lessee under paragraph (a) hereof, Section 1 hereof
entitled "Letting", Section 19 hereof entitled "Assignment and Sublease",
Section 29 hereof entitled "Removal of Property", Section 30 hereof entitled
"Brokerage", and paragraph (d) of Section 62 hereof entitled
"Non-Discrimination".
Minimum Limits
Commercial General Liability
Combined single limit per
occurrence for death, bodily injury
and property damage liability: $100,000,000.00
Commercial Automobile Liability
(covering owned, non-owned and
hired vehicles)
Combined single limit per occurrence
for death, bodily injury and property
damage liability: $25,000,000.00
Baggage Legal Liability $10,000,000.00
(2) The Lessee shall also procure and maintain in effect, or
cause to be procured and maintained in effect, Workers' Compensation Insurance
and Employer's Liability Insurance in accordance with and as required by law and
including coverage for asbestos exposure.
(3) Without limiting the provisions hereof, in the event the
Lessee maintains the foregoing insurance in limits greater than aforesaid, the
Port Authority shall be included therein as an additional insured to the full
extent of all such insurance in accordance with the terms and provisions hereof.
(c) Notwithstanding the foregoing, it is specifically understood and
agreed that the Port Authority shall have the right upon notice to the Lessee
given from time to time and at any time to require the Lessee to increase any or
all of the foregoing limits to commercially reasonable amounts and the Lessee
shall promptly comply therewith and shall promptly submit a certificate or
certificates evidencing the same to the Port Authority.
(d) As to the insurance required by the provisions of this Section, a
certified copy of each of the policies or a certificate or certificates
evidencing the existence thereof, or binders shall be delivered to the Port
Authority prior to the Lease Commencement Date. In the event any binder is
delivered, it shall be replaced within thirty (30) days by a certified copy of
the policy or a certificate. Each such copy or certificate shall contain a valid
provision or endorsement that the policy may not be canceled or terminated
without giving thirty (30) days'
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written advance notice thereof to the Port Authority and the City of New York
and that the policy may not be changed or modified in any way that would affect
the Port Authority or the City of New York without giving thirty (30) days'
written advance notice thereof to the Port Authority and the City of New York.
Each such copy or certificate shall contain an additional endorsement providing
that the insurance carrier shall not, without obtaining express advance
permission from the General Counsel of the Port Authority, raise any defense
involving in any way the jurisdiction of the tribunal over the person of the
Port Authority, the immunity of the Port Authority, its Commissioners, officers,
agents or employees, the governmental nature of the Port Authority or the
provisions of any statutes respecting suits against the Port Authority. Renewal
policies or certificates shall be delivered to the Port Authority prior to the
expiration of the insurance which the policies are to renew. The aforesaid
insurance shall be written by a company or companies approved by the Port
Authority, the Port Authority agreeing not to withhold its approval
unreasonably. If at any time any of the insurance policies shall be or become
unsatisfactory to the Port Authority as to form or substance or if any of the
carriers issuing such policies shall be or become unsatisfactory to the Port
Authority, the Lessee shall promptly obtain a new and satisfactory policy in
replacement, the Port Authority covenanting and agreeing not to act unreasonably
hereunder. If the Port Authority at any time so requests, a certified copy of
each of the policies shall be made available by the Lessee to the Port Authority
for inspection and reproduction at an office of the Lessee within the Port of
New York District.
SECTION 14. SIGNS
(a) Except with the prior written approval of the Port Authority, the
Lessee shall not erect, maintain or display any signs or advertising at or on
the exterior parts of the Premises or in the Premises so as to be visible from
outside the Premises or at or on any other portion of the Airport outside the
Premises. Interior and exterior signs affecting public safety and security shall
be in accordance with established Port Authority standards.
(b) Upon the expiration or termination of the letting, the Lessee
shall remove, obliterate or paint out, as the Port Authority may direct, any and
all signs and advertising on the Premises or elsewhere on the Airport and in
connection therewith shall restore the portion of the Premises and the Airport
affected by such signs or advertising to the same condition as existing prior to
the installation of such signs and advertising. In the event of a failure on the
part of the Lessee so to remove, obliterate or paint out each and every such
sign or advertising and so to restore the Premises and the Airport, the Port
Authority may perform the necessary work and the Lessee shall pay the cost
thereof to the Port Authority on demand.
SECTION 15. OBSTRUCTION LIGHTS
The Lessee shall install, maintain and operate at its own expense such
obstruction lights on the Premises as the Federal Aviation Administration may
direct or as the General Manager of the Airport may reasonably direct, and shall
energize such lights daily for a period commencing thirty (30) minutes before
sunset and ending thirty (30) minutes after sunrise (as sunset and sunrise may
vary from day to day throughout the year) and for such other period as may be
directed or requested by the control tower of the Airport.
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SECTION 16. ADDITIONAL RENT AND CHARGES
(a) If the Port Authority has paid any sum or has incurred any
obligations or expenses (including without limitation payments to third persons
and internal Port Authority costs and expenses) for which the Lessee has agreed
to pay or reimburse the Port Authority pursuant to the terms and conditions of
this Lease or if the Port Authority is required or elects to pay any sum or sums
or incurs any obligations or expense (including without limitation payments to
third persons and internal Port Authority costs and expenses) by reason of the
failure, neglect or refusal of the Lessee to perform one or more of the
conditions, covenants or agreements contained in this Agreement or as a result
of an act or omission of the Lessee contrary to the said conditions, covenants
and agreements, the Lessee agrees to pay the sum or sums so paid or the expense
so incurred, including all interest, costs, damages and penalties, and the same
may be added to any installment of rent thereafter due hereunder, and each and
every part of the same shall be and become additional rent, recoverable by the
Port Authority in the same manner and with like remedies as if it were
originally a part of the rent as set forth in Section 4 hereof entitled
"Rental".
(b) For all purposes under this Section and in any suit, action or
proceeding of any kind between the parties hereto, any receipt showing any
payment of a sum or sums by the Port Authority for any work done or material
furnished shall be prima facie evidence against the Lessee that the amount of
such payment was necessary and reasonable. Should the Port Authority elect to
use its operating and maintenance staff in performing any work and to charge the
Lessee with the cost of same, any time report of any employee of the Port
Authority showing hours of labor or work allocated to such work, or any stock
requisition of the Port Authority showing the issuance of materials actually
used in the performance thereof, shall likewise be prima facie evidence against
the Lessee that the amount of such charge was necessary and reasonable.
SECTION 17. RIGHTS OF ENTRY RESERVED
(a) The Port Authority, by its officers, employees, agents,
representatives and contractors shall have the right at all reasonable times to
enter upon the Premises for the purpose of inspecting the same, for observing
the performance by the Lessee of its obligations under this Agreement, and for
the doing of any act or thing which the Port Authority may be obligated or have
the right to do under this Agreement or otherwise.
(b) Without limiting the generality of the foregoing, the Port
Authority, by its officers, employees, agents, representatives, and contractors,
and furnishers of utilities and other services, shall have the right, for its
own benefit, for the benefit of the Lessee, or for the benefit of others than
the Lessee at the Airport, to maintain existing and future utility, mechanical,
electrical and other systems and to enter upon the Premises at all reasonable
times to make such repairs, replacements or alterations as may, in the opinion
of the Port Authority, be deemed necessary or advisable and, from time to time,
to construct or install over, in or under the Premises new systems or parts
thereof, and to use the Premises for access to other parts of the Airport
otherwise not conveniently accessible (any such repairs, replacements,
alterations, construction, installation or use for access being herein referred
to as a "Utility Servicing"); provided, however, that in the conduct of such
Utility Servicing the Port Authority shall (i) not
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unreasonably interfere with the use and occupancy of the Premises by the Lessee,
(ii) provide the Lessee notice of any Utility Servicing (except in cases of
emergency) and (iii) restore or cause the restoration of any excavation,
demolition or other damage to the Premises resulting as part of the Utility
Servicing to its original state.
(c) (1) Further, without limiting the generality of this Section, the
Port Authority, by its officers, employees, agents, representatives and
contractors and furnishers of service shall have the right, for its own benefit,
for the benefit of the Lessee, or for the benefit of others than the Lessee at
the Airport to maintain the portions of the Distribution Portion of the System,
the Traffic Systems and the Cogeneration Facility located under or on the
Premises and to enter upon the Premises at all times to make such repairs,
replacements or alterations to the Distribution Portion of the System, the
Traffic Systems, the AirTrain and the Cogeneration Facility as may, in the
opinion of the Port Authority, be deemed necessary or desirable and, from time
to time to construct or install over, in or under the Premises additions or
extensions to said Distribution Portion of the System, the Traffic Systems,
AirTrain and the Cogeneration Facility; provided, however, that in the exercise
of such rights of access, repair, alteration or new construction the Port
Authority shall not unreasonably interfere with the use and occupancy of the
Premises by the Lessee pursuant to the provisions of this Agreement.
(2) Neither the Distribution Portion of the System, the AirTrain,
the Traffic Systems or the Cogeneration Facility nor any part of any of the
foregoing shall be or be deemed to be a part of the Premises under the Lease.
(d) In the event that any property of the Lessee shall obstruct the
access of the Port Authority, its employees, agents or contractors to any of the
existing or future utility, mechanical, electrical and other systems and thus
shall interfere with the inspection, maintenance or repair of any such system,
the Lessee shall move such property, as directed by the Port Authority, in order
that access may be had to the system or part thereof for its inspection,
maintenance or repair, and, if the Lessee shall fail to so move such property
after direction from the Port Authority to do so, the Port Authority may move it
and the Lessee hereby agrees to pay the cost of such moving upon demand.
(e) Nothing in this Section shall or shall be construed to impose upon
the Port Authority any obligations so to construct or maintain or to make
repairs, replacements, alterations or additions, or shall create any liability
for any failure so to do. The Lessee is and shall be in exclusive control and
possession of the Premises and the Port Authority shall not in any event be
liable for any injury or damage to any property or to any Person happening on or
about the Premises nor for any injury or damage to the Premises except as set
forth in paragraph (b) of this Section nor to any property of the Lessee or of
any other Person located in or thereon (other than those occasioned by the
affirmative acts of the Port Authority, its employees, agents and
representatives).
(f) At any time and from time to time during ordinary business hours
within the six (6) months next preceding the expiration of the letting, the Port
Authority, for and by its agents and employees, whether or not accompanied by
prospective lessees, occupiers or users of
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the Premises, shall have the right to enter thereon for the purpose of
exhibiting and viewing all parts of the same.
(g) If, during the last month of the letting, the Lessee shall have
removed all or substantially all its property from the Premises, the Port
Authority may, with the prior written consent of the Lessee, immediately enter
and alter, renovate and redecorate the Premises.
(h) Without limiting the generality of this Section, the Port
Authority, by its officers, employees, agents, representatives, contractors and
furnishers of services, and the Port Authority's lessees, permittees and other
Persons which now or in the future are occupants or users of the Terminal 6 Site
with the permission of the Port Authority, by its and their contractors,
employees, agents, representatives and furnishers of services shall have the
right, for the benefit of the Port Authority, or for the benefit of such
lessees, permittees and other Persons or for the benefit of the Lessee to enter
upon the Premises at all times to construct such modifications, additions,
installations, equipment, fixtures, structures, improvements and facilities on
the Premises as may in the opinion of the Port Authority be necessary or
desirable in connection with the use, occupancy and or redevelopment of the
Terminal 6 Site, including without limitation modifications, additions,
installations, equipment, fixtures, structures, improvements and facilities to
signage, arrivals level roadways and frontages, departures level roadways and
frontages, fire alarm systems and that portion of the New Passenger Terminal
adjoining the Terminal 6 Site as shall be necessary or desirable to permit the
free flow and circulation of the public and other users and occupants of the
Terminal 6 Site and their vehicles, aircraft and other equipment between the
Terminal 6 Site and the Premises, between the Terminal 6 Site and the Terminal 5
AirTrain Connector and as shall be necessary or desirable to connect a new
passenger terminal on the Terminal 6 Site to the New Passenger Terminal in such
a manner as the two terminals would function as one continuous terminal.
(i) The exercise of any or all of the foregoing rights by the Port
Authority or others shall not be or be construed to be an eviction of the Lessee
nor be made the grounds for any abatement of rental nor any claim or demand for
damages, consequential or otherwise.
SECTION 18. CONDEMNATION
(a) Definitions:
The following terms, when used in this Section 18, shall, unless
the context shall require otherwise, have the respective meanings given below:
(1) "Date of the Taking" shall be deemed to be the date on which
title to Premises or a portion thereof shall have vested in any lawful power or
authority pursuant to the provisions of the applicable federal or New York State
law.
(2) "Material Part" with reference to the Premises or with
reference to the Public Landing Area shall mean such portion of the Premises or
the Public Landing Area as when so taken would leave remaining a balance of the
Premises, whether due either to the area so taken or the location of the part so
taken in relation to the part not so taken, would not under economic conditions
and after performance by the Lessee of all covenants, agreements, terms
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and provisions contained herein or by law required to be observed or performed
by the Lessee, permit the restoration of the Premises so as to enable the Lessee
to operate, maintain and develop the Premises in accordance with Sections 2 and
5 of this Agreement.
(b) Permanent Taking of All or a Portion of the Premises and the
Public Landing Area
(1) If a taking covers the entire Premises, then this Agreement
shall, as of the date possession is taken, or as of the effective date of such
termination, cease and determine in the same manner and with the same effect as
if the date were the original date of expiration hereof.
(2) If less than all of the Premises shall be so taken, this
Agreement and the Term shall continue as to the portion of the Premises not so
taken, and the letting as to the part of the Premises so taken shall, as of the
date possession thereof is taken, or as of the effective date of such
termination, cease and determine in the same manner and with the same effect as
if the term of the letting had on that date expired, and the rentals shall be
abated as provided in Section 4 hereof.
(3) If the taking covers only a Material Part of the Premises or
of the Public Landing Area, then the Lessee and the Port Authority shall each
have an option exercisable by notice given within ten (l0) days after the Date
of the Taking to terminate the letting hereunder with respect to the Premises
not taken, as of the Date of the Taking, and such termination shall be effective
as if the Date of the Taking were the original date of expiration hereof. If the
Port Authority exercises this option, it shall purchase from the Lessee the
Lessee's leasehold interest (excluding any personal property whatsoever) in the
Premises not taken for a consideration equal to the Lessee's Unamortized
Investment, if any, in the Premises not taken. If the letting of the entire
Premises is not terminated, the settlement or abatement of rentals after the
date the body exercising such taking takes possession shall be abated in
accordance with Section 4 hereof entitled "Rental".
(4) If less than the entire Premises is so taken and the letting
of the Premises not taken is not terminated pursuant to paragraph (b)(3) of this
Section, the Lessee (subject to Section 33 hereof entitled "Other Construction
by the Lessee and Section 44 hereof entitled "Force Majeure" and all other
applicable terms and provisions of this Lease) shall proceed diligently to
restore any remaining part of the Premises not so taken so that the Premises
shall be a complete, operable, self-contained architectural unit in good
condition and repair and the proceeds of that portion of any award paid in trust
to the Port Authority pursuant to Section 23.3 of the Basic Lease attributable
to the improvements on the Premises not so taken shall be made available by the
Port Authority to and be used by the Lessee for that purpose. The Port Authority
shall retain any excess of such award over the costs of the restoration.
(c) Taking of a Temporary Interest in All or Any Part of the Premises
or the Public Landing Area:
(1) If the temporary use of the whole or any part of the Premises
shall be taken for any public or quasi-public purpose by any lawful power or
authority by the exercise
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of the right of condemnation or eminent domain or by agreement between the Port
Authority and those authorized to exercise such right, (w) the Lessee shall give
prompt notice thereof to the Port Authority, (x) the Term shall not be reduced
or affected in any way and (y) the Lessee shall continue to pay in full all
rentals payable by the Lessee hereunder without reduction or abatement except as
set forth in paragraph (c)(2) below.
(2) If a temporary taking covers all or a Material Part of the
Premises or the Public Landing Area, then the Lessee and the Port Authority
shall each have an option, exercisable by notice given within ten (10) days
after the Date of the Taking, to suspend the term of the letting of such of the
Premises as are not so taken during the period of the taking, and, in that
event, the rentals for such portion of the Premises not so taken shall ▇▇▇▇▇ for
the period of the suspension in accordance with Section 4 hereof entitled
"Rental". If the Port Authority exercises this option, it shall purchase from
the Lessee the Lessee's leasehold interest (excluding any personal property
whatsoever) in the Premises not taken for the period of suspension for a
consideration equal to the Lessee's Unamortized Investment, if any, in such
Premises which is to be amortized over the period of such suspension.
(d) The Lessee shall execute any and all documents that may be
reasonably required in order to facilitate collection by the appropriate party
of awards or payments covered by this Section.
(e) To the extent a condemnation claim by the Lessee shall not
diminish any claim, award, compensation or damages of or to the City or of the
Port Authority on account of any condemnation and such condemnation claim is
permitted by Section 23 of the Basic Lease, the Lessee may file a claim in a
condemnation proceeding.
SECTION 19. ASSIGNMENT AND SUBLEASE
(a) (1) The Lessee covenants and agrees that it will not sell, convey,
transfer, mortgage, pledge or assign this Agreement or any part thereof, or any
rights created thereby or the letting thereunder or any part thereof without the
prior written consent of the Port Authority provided, however, that this
Agreement may be assigned in its entirety (by operation of law or otherwise)
without such consent to any successor in interest of the Lessee which is or is
to be a Scheduled Aircraft Operator (as defined in Section 94 of this
Agreement), and into which the Lessee may merge or with which the Lessee may
consolidate, or which may succeed to the assets of the Lessee or the major
portion of its assets related to its air transportation system (any such
successor in interest of the Lessee being hereinafter called a "Qualified
Assignee"), if immediately following the merger, consolidation or succession of
assets the Qualified Assignee has a financial standing at least as good as that
of the Lessee immediately preceding the merger, consolidation or succession of
assets (by which is meant that the Qualified Assignee's tangible net worth shall
be at least as favorable as the tangible net worth of the Lessee immediately
preceding the merger, consolidation or succession of assets).
(2) In the event that this Agreement shall be assigned in its
entirety (by operation of law or otherwise) without the prior written approval
of the Port Authority to a successor in interest of the Lessee which is or is to
be a Scheduled Aircraft Operator (as defined in Section 94 of this Agreement),
and into which the Lessee may merge or with which the Lessee may consolidate, or
which may succeed to the assets of the Lessee or the major portion of
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its assets related to its air transportation system the Lessee shall submit to
the Port Authority prior to the tenth (10th) day after but not earlier than
thirty (30) days prior to such transfer of this Agreement all appropriate
information and documentation sufficient to allow the Port Authority to
determine whether immediately following the merger, consolidation or succession
of assets such successor in interest of the Lessee has a financial standing at
least as good as that of the Lessee immediately preceding the merger,
consolidation or succession of assets (by which is meant that the successor in
interest's tangible net worth shall be at least as favorable as that of the
Lessee immediately preceding the merger, consolidation or succession of assets).
(b) (1) The Lessee shall not sublet the Premises or any part thereof,
without the prior written consent of the Port Authority.
(2) (i) "Affiliated Scheduled Aircraft Operator" shall mean a
Person that is a Scheduled Aircraft Operator and if such Scheduled Aircraft
Operator is a corporation, then to be an "Affiliated Scheduled Aircraft
Operator", the Lessee shall be the absolute and unconditional owner of all of
the issued and outstanding stock of such corporation and if such Scheduled
Aircraft Operator is not a corporation, then to be an "Affiliated Scheduled
Aircraft Operator", the Lessee shall be the absolute and unconditional owner of
all of the ownership interests of such Scheduled Aircraft Operator and such
Scheduled Aircraft Operator shall be a wholly owned subsidiary of the Lessee.
(ii) Notwithstanding any provision of this Lease and in
addition thereto, and without the requirement for any permit, consent to
sublease or other use agreement from the Port Authority, the Port Authority
hereby grants its consent to the use of the Premises by an Affiliated Scheduled
Aircraft Operator for the purposes set forth in Section 5 hereof, such use being
without payment of the Port Authority fees for such use, in accordance with the
terms and conditions of the Lease for so long as such Scheduled Aircraft
Operator meets all of the requirements to qualify as an Affiliated Scheduled
Aircraft Operator. In the event said Scheduled Aircraft Operator shall cease to
qualify as an Affiliated Scheduled Aircraft Operator, the Lessee shall
immediately so inform the Port Authority and deliver to the Port Authority a
copy of the agreement between the Lessee and the former Affiliated Scheduled
Aircraft Operator covering the use and occupancy of the Premises by such former
Affiliated Scheduled Aircraft Operator. Thereafter a document or documents shall
be prepared by the Port Authority and sent to the Lessee for execution by the
Lessee and said former Affiliated Scheduled Aircraft Operator which document(s)
shall be effective as of the date that the Affiliated Scheduled Aircraft
Operator no longer qualifies as an Affiliated Scheduled Aircraft Operator and
shall include, among other things, the right of said former Affiliated Scheduled
Aircraft Operator to continue to use the Premises on the terms and conditions of
the Lease, and the joint and several obligation of the Lessee and said former
Affiliated Scheduled Aircraft Operator to pay to the Port Authority the then
appropriate Port Authority fees therefore.
(iii) It is specifically understood and agreed that any
sublease or other agreement or arrangement (hereinafter called the "Affiliated
Scheduled Aircraft Operator Arrangement") covering an Affiliated Scheduled
Aircraft Operator's use and/or occupancy of the Premises shall be for a term
expiring no later than the day before the expiration date of this
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Agreement and shall provide that the portion of the Premises to be used by the
Affiliated Scheduled Aircraft Operator shall be used solely for the purposes set
forth in Section 5 hereof.
(iv) Without limiting any rights or remedies of the Port
Authority or obligations of an Affiliated Scheduled Aircraft Operator, the
Lessee hereby assumes all risks and responsibilities for each Affiliated
Scheduled Aircraft Operator's operations at the Airport including without
limitation the payment of fees and charges payable by said Affiliated Scheduled
Aircraft Operator to the Port Authority and the Lessee hereby agrees that all
acts and omissions of said Affiliated Scheduled Aircraft Operator at the Airport
shall be and be deemed to be acts and omissions of the Lessee. Without limiting
the generality of the foregoing or any other term or provision of this
Agreement, the failure of an Affiliated Scheduled Aircraft Operator to comply
with any agreement, term, covenant or condition of the Lease shall be and be
deemed to be a failure of the Lessee to have complied with such agreement, term,
covenant or condition and further the Lessee shall indemnify and hold harmless
the Port Authority, its Commissioners, officers, employees and representatives,
from and against (and shall reimburse the Port Authority for the Port
Authority's costs and expenses, whether those of the Port Authority's Law
Department or otherwise, including legal expenses incurred in connection with
the defense of) all claims and demands of third persons including but not
limited to claims and demands for death or personal injuries, or for property
damages, arising out of a breach or default of any term or provision of this
Agreement by each Affiliated Scheduled Aircraft Operator, or out of the use or
occupancy of the Premises by each Affiliated Scheduled Aircraft Operator or by
others with its consent, or out of any other acts or omissions of each
Affiliated Scheduled Aircraft Operator, its officers, employees, guests,
representatives, customers, contractors, invitees or business visitors on the
Premises, or arising out of the acts or omissions of each Affiliated Scheduled
Aircraft Operator, its officers and employees elsewhere at the Airport
(excepting only claims and demands arising solely from the willful misconduct or
the sole negligence of the Port Authority), including claims and demands of the
City of New York, from which the Port Authority derives its rights in the
Airport, for indemnification, arising by operation of law or through the Basic
Lease. If so directed, the Lessee shall at its own expense defend any suit based
upon any such claim or demand (even if such suit, claim or demand is groundless,
false or fraudulent), and in handling such it shall not, without obtaining
express advance permission from the General Counsel of the Port Authority, raise
any defense involving in any way the jurisdiction of the tribunal over the
person of the Port Authority, the immunity of the Port Authority, its
Commissioners, officers, agents or employees, the governmental nature of the
Port Authority or the provision of any statutes respecting suits against the
Port Authority.
(c) Any sale, assignment, transfer, sublease, mortgage, pledge,
hypothecation, encumbrance or disposition of the Premises or of the rents,
revenues or any other income from the Premises, or this Agreement or any part
thereof, or any license or other interest of the Lessee therein not made in
accordance with the provisions of this Agreement shall be null and void ab
initio and of no force or effect.
(d) If without the prior written consent of the Port Authority, the
Lessee assigns, sells, conveys, transfers, mortgages, pledges or sublets in
violation of paragraphs (a) or (b) of this Section or if the Premises are
occupied by anybody other than the Lessee, the Port Authority may collect rent
from any assignee, sublessee or anyone who claims a right under this Agreement
or letting or who occupies the Premises, and the Port Authority shall apply the
net
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amount collected to the rental herein reserved; but no such collection shall be
deemed a waiver by the Port Authority of the covenants contained in paragraphs
(a) and (b) of this Section or an acceptance by the Port Authority of any such
assignee, sublessee, claimant or occupant as Lessee, nor a release of the Lessee
by the Port Authority from the further performance by the Lessee of the
covenants contained herein.
(e) Any consent granted by the Port Authority to any assignment or
subletting to any sublease pursuant to the provisions hereof shall not be
construed or deemed to release, relieve or discharge any succeeding assignee,
successor or transferee of the Lessee or any other Person claiming any right,
title or interest in this Agreement from the requirement of obtaining the prior
written consent of the Port Authority in the event it wishes to sell, convey,
transfer, mortgage, pledge, sublet or assign this Agreement or any part thereof,
or any rights created thereby or the letting hereunder or any part thereof, or
any rights created thereby without such prior written consent of the Port
Authority.
(f) The Lessee shall not use or permit any Person to use the Premises
or any portion thereof for any purpose other than the purposes stated in Section
5 hereof entitled "Use of Premises". Except as provided in this Agreement or
otherwise permitted in writing by the Port Authority, the Lessee shall not
permit the Premises to be used or occupied by any Person other than its own
officers, employees, passengers, contractors and representatives.
(g) The Port Authority shall not assign or otherwise transfer this
Lease or any of its rights hereunder (i) to any private Person without written
consent duly executed by the Lessee; or (ii) to the City of New York, unless the
City of New York at the time of such assignment or transfer assumes the
obligations of the Port Authority under this Lease.
SECTION 20. TERMINATION BY THE PORT AUTHORITY
(a) If any one or more of the following events shall occur (each an
"Event of Default"), that is to say:
(1) The Lessee shall become insolvent or shall take the benefit
of any present or future insolvency statute, or shall make a general assignment
for the benefit of creditors, or file a voluntary petition in bankruptcy or a
petition or answer seeking an arrangement or its reorganization or the
readjustment of its indebtedness under the federal bankruptcy laws or under any
other law or statute of the United States or of any state thereof, or consent to
the appointment of a receiver, trustee, or liquidator of all or substantially
all of its property; or
(2) By order or decree of a court the Lessee shall be adjudged
bankrupt or an order shall be made approving a petition filed by any of its
creditors or by any of the stockholders of the Lessee, seeking its
reorganization or the readjustment of its indebtedness under the federal
bankruptcy laws or under any law or statute of the United States or any state
thereof, provided that if any such judgment or order or decree is stayed or
vacated within sixty (60) days after the entry thereof, any notice of
cancellation shall be and become null, void and of no effect; or
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(3) By or pursuant to, or under authority of any legislative act,
resolution or rule, or any order or decree of any court or governmental board,
agency or officer having jurisdiction, a receiver, trustee, or liquidator shall
take possession or control of all or substantially all of the property of the
Lessee, and such possession or control shall continue in effect for a period of
sixty (60) days; or
(4) The Lessee shall voluntarily abandon, desert or vacate the
Premises or discontinue its operations at the Airport, or after exhausting or
abandoning any right of further appeal, the Lessee because of an act or omission
of the Lessee, shall be prevented for a period of sixty (60) days by action of
any Governmental Agency other than the Port Authority having jurisdiction
thereof, from conducting its operations at the Airport; or
(5) Any lien is filed against the Premises because of any act or
omission of the Lessee and shall not be discharged or bonded within ninety (90)
days after the Lessee has received notice thereof; or
(6) Except as set forth in paragraph (a) of Section 19 hereof and
in Sections 42 and 43 with respect to Gates and Gate Related Premises, the
letting hereunder or the interest or estate of the Lessee under this Agreement
shall be transferred directly by the Lessee or shall pass to or devolve upon, by
operation of law or otherwise, any other Person, firm or corporation; or
(7) A petition under any part of the federal bankruptcy laws or
an action under any present or future insolvency law or statute shall be filed
against the Lessee and shall not be dismissed within ninety (90) days after the
filing thereof; or
(8) If either (i) the Lessee shall, without the prior written
approval of the Port Authority, become a merged (non-surviving) corporation in a
merger, a constituent corporation in a consolidation, or a corporation in
dissolution, except as otherwise expressly permitted in paragraph (a) of Section
19 hereof, or (ii) the Lessee shall, without the prior written approval of the
Port Authority, become a possessor (surviving) corporation in a merger and
either is not a Scheduled Aircraft Operator after such merger or immediately
after the merger the Lessee's tangible net worth is not at least as favorable as
the Lessee's tangible net worth was immediately preceding the merger; or
(9) The Lessee shall fail duly and punctually to pay the rentals
or to make any other payment required hereunder when due to the Port Authority
and shall continue in its failure to pay rentals or to make any other payments
required hereunder for a period of twenty (20) days after receipt of written
notice by it from the Port Authority to make such payments; or
(10) The Lessee shall fail to keep, perform and observe each and
every other promise, covenant and agreement set forth in this Agreement on its
part to be kept, performed, or observed, within thirty (30) days after receipt
of notice of default thereunder from the Port Authority (except where
fulfillment of its obligation requires activity over a period of time, and the
Lessee shall have commenced to perform whatever may be required for fulfillment
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within thirty (30) days after receipt of written notice of default by it from
the Port Authority and continues such performance without interruption except
for causes beyond its control);
then upon the occurrence of any such event or at any time thereafter during the
continuance thereof, the Port Authority may upon twenty (20) days' notice (such
notice a "Notice of Termination" terminate the rights of the Lessee hereunder
and the letting, such termination to be effective upon the date specified in
such notice. Such right of termination and the exercise thereof shall be and
operate as a conditional limitation.
(b) The rights of termination described above shall be in addition to
any other rights of termination provided in this Agreement and in addition to
any rights and remedies that the Port Authority would have at law or in equity
consequent upon any breach of this Agreement by the Lessee, and the exercise by
the Port Authority of any right of termination shall be without prejudice to any
other such rights and remedies.
(c) No failure by the Port Authority to insist upon the strict
performance of any agreement, term, covenant or condition of the Lease or to
exercise any right or remedy consequent upon a breach or default thereof, and no
extension, supplement or amendment of the Lease during or after a breach
thereof, unless expressly stated to be a waiver, and no acceptance by the Port
Authority of rentals, fees, charges or other payments in whole or in part after
or during the continuance of any such breach or default, shall constitute a
waiver of any such breach or default of such agreement, term, covenant or
condition. No agreement, term, covenant or condition of the Lease to be
performed or complied with by the Lessee, and no breach or default thereof,
shall be waived, altered or modified except by a written instrument executed by
the Port Authority. No waiver by the Port Authority of any default or breach on
the part of the Lessee in performance of any agreement, term, covenant or
condition of this Lease shall affect or alter the Lease, but each and every
agreement, term, covenant and condition thereof shall continue in full force and
effect with respect to any other then existing or subsequent breach or default
thereof.
(d) In the event that the Lessee shall, without the prior written
approval of the Port Authority, become a possessor (surviving) corporation in a
merger and is a Scheduled Aircraft Operator after such merger, the Lessee shall
submit to the Port Authority prior to the tenth (10th) day after, but not
earlier than thirty (30) days prior to, such merger all appropriate information
and documentation sufficient to allow the Port Authority to determine whether
immediately following the merger the Lessee has a financial standing at least as
good as the Lessee's financial standing was immediately preceding the merger (by
which is meant that the Lessee's tangible net worth immediately after the merger
shall be at least as favorable as the Lessee's tangible net worth immediately
preceding the merger).
SECTION 21. RIGHTS OF RE-ENTRY
The Port Authority shall, as an additional remedy upon the giving of a
notice of termination as provided in Section 20 hereof entitled "Termination by
the Port Authority" or any other Section hereof, have the right to re-enter the
Premises and every part thereof upon the effective date of termination without
further notice of any kind, and may regain and resume possession either with or
without the institution of summary or any other legal proceedings or
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otherwise. Such re-entry, or regaining or resumption of possession, however,
shall not in any manner affect, alter or diminish any of the obligations of the
Lessee under this Agreement, and shall in no event constitute an acceptance of
surrender.
SECTION 22. WAIVER OF REDEMPTION
The Lessee hereby waives any and all rights to recover or regain
possession of the Premises and all rights of redemption, granted by or under any
present or future law in the event it is evicted or dispossessed for any cause,
or in the event the Port Authority obtains possession of the Premises in any
lawful manner.
SECTION 23. SURVIVAL OF THE OBLIGATIONS OF THE LESSEE
(a) In the event that the letting shall have been terminated in
accordance with a notice of termination as provided in Section 20 hereof
entitled "Termination by the Port Authority", or the interest of the Lessee
canceled pursuant thereto, or in the event that the Port Authority has
re-entered, regained or resumed possession of the Premises in accordance with
the provisions of Section 21 hereof entitled "Right of Re-entry", all the
obligations of the Lessee under this Agreement shall survive such termination or
cancellation, or re-entry, regaining or resumption of possession and shall
remain in full force and effect for the full term of the letting under this
Agreement, and the amount or amounts of damages or deficiency shall become due
and payable to the Port Authority to the same extent, at the same time or times
and in the same manner as if no termination, cancellation, re-entry, regaining
or resumption of possession had taken place. The Port Authority may maintain
separate actions each month to recover the damage or deficiency then due or at
its option and at any time may sue to recover the full deficiency less the
proper discount, for the entire unexpired term.
(b) The amount of damages for rentals for the period of time
subsequent to termination or cancellation (or re-entry, regaining or resumption
of possession) shall be the sum of the following:
(1) On account of the Lessee's obligation for the First Ground
Rental, the amount of the total of all annual First Ground Rentals less the
amount attributable to the installments of such annual First Ground Rentals
payable prior to the effective date of termination or cancellation, except that
the credit to be allowed for the installment thereof payable on the first day of
the month in which the termination or cancellation is effective shall be
prorated for the part of the month the letting remains in effect on the basis of
the actual number of days in such month, and
(2) On account of the Lessee's obligation for the Second Ground
Rental, the amount of the total of all annual Second Ground Rentals less the
amount attributable to the installments of such annual Second Ground Rentals
payable prior to the effective date of termination or cancellation, except that
the credit to be allowed for the installment thereof payable on the first day of
the month in which the termination or cancellation is effective shall be
prorated for the part of the month the letting remains in effect on the basis of
the actual number of days in such month, and
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(3) On account of the Lessee's obligation for the Third Ground
Rental, the amount of the total of all annual Third Ground Rentals less the
amount attributable to the installments of such annual Third Ground Rentals
payable prior to the effective date of termination or cancellation, except that
the credit to be allowed for the installment thereof payable on the first day of
the month in which the termination or cancellation is effective shall be
prorated for the part of the month the letting remains in effect on the basis of
the actual number of days in such month, and
(4) On account of the Lessee's obligation for the Fourth Ground
Rental, the amount of the total of all annual Fourth Ground Rentals less the
amount attributable to the installments of such annual Fourth Ground Rentals
payable prior to the effective date of termination or cancellation, except that
the credit to be allowed for the installment thereof payable on the first day of
the month in which the termination or cancellation is effective shall be
prorated for the part of the month the letting remains in effect on the basis of
the actual number of days in such month, and
(5) On account of the Lessee's obligation for the Fifth Ground
Rental, the amount of the total of all annual Fifth Ground Rentals less the
amount attributable to the installments of such annual Fifth Ground Rentals
payable prior to the effective date of termination or cancellation, except that
the credit to be allowed for the installment thereof payable on the first day of
the month in which the termination or cancellation is effective shall be
prorated for the part of the month the letting remains in effect on the basis of
the actual number of days in such month, and
(6) On account of the Lessee's obligation for the Temporary
Facility Ground Rental, the amount of the total of all annual Temporary Facility
Ground Rental less the amount attributable to the installments of such annual
Temporary Facility Ground Rentals payable prior to the effective date of
termination or cancellation, except that the credit to be allowed for the
installment thereof payable on the first day of the month in which the
termination or cancellation is effective shall be prorated for the part of the
month the letting remains in effect on the basis of the actual number of days in
such month, and
(7) On account of the Lessee's obligation for the First
Enplanement Rental, the amount of the total of all monthly First Enplanement
Rentals which would have been paid by the Lessee during the balance of the term
as if there had been no termination or cancellation, or re-entry, regaining, or
resumption or possession; and for the purpose of calculation hereunder from and
after the date of such termination, or cancellation the such First Enplanement
Rental shall be the greater of the Minimum First Enplanement Rental for each
Annual Period and the Activity Based First Enplanement Rental, the number of
Enplanements to be used to calculate such Activity Based First Enplanement
Rental for each Monthly Period after the date of such termination or
cancellation shall be the total number of Enplanements for the most recent
Monthly Period which occurred prior to the effective date of termination or
cancellation, and
(8) On account of the Lessee's obligation for the Second
Enplanement Rental, the amount of the total of all annual Second Enplanement
Rentals which would have
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been paid by the Lessee during the balance of the term as if there had been no
termination or cancellation, or re-entry, regaining, or resumption or
possession; and for the purpose of calculation hereunder from and after the date
of such termination, or cancellation the amount of the Second Enplanement Rental
shall be calculated for each Annual Period using just the Minimum Enplanement
Rental for such Annual Period, and
(9) On account of the Lessee's obligation for First Additional
Rental, the amount of the total of all monthly First Additional Rental payments
payable under Section 4 of this Agreement, less the amount attributable to the
installments of such First Additional Rental payable prior to the effective date
of termination or cancellation, except that the credit to be allowed for the
installment thereof payable on the first day of the month in which the
termination or cancellation is effective shall be prorated for the part of the
month the letting remains in effect, on the basis of the actual number of days
in such month, and
(10) On account of the Lessee's obligation for Second Additional
Rental, the amount equal to the difference obtained by subtracting the amount of
Cost of the Lessee's $80 Million Work as of the effective date of termination or
cancellation from the amount of Eighty Million Dollars and No Cents
($80,000,000.00), and
(11) On account of the Lessee's obligation for Third Additional
Rental, the amount of the total of all monthly Third Additional Rental payments
required under Section 4 of this Agreement, less the amount attributable to the
installments of such Third Additional Rental payable prior to the effective date
of termination or cancellation, except that the credit to be allowed for the
installment thereof payable on the first day of the month in which the
termination or cancellation is effective shall be prorated for the part of the
month the letting remains in effect, on the basis of the actual number of days
in such month, and
(12) On account of the Lessee's obligation for Fourth Additional
Rental, the amount of the total of all monthly Fourth Additional Rental payments
payable under Section 4 of this Agreement, less the amount attributable to the
installments of such Fourth Additional Rental payable prior to the effective
date of termination or cancellation, except that the credit to be allowed for
the installment thereof payable on the first day of the month in which the
termination or cancellation is effective shall be prorated for the part of the
month the letting remains in effect, on the basis of the actual number of days
in such month, and
(13) On account of the Lessee's obligation for Fifth Additional
Rental, the amount of the total of all monthly Fifth Additional Rental payments
payable under Section 4 of this Agreement, less the amount attributable to the
installments of such Fifth Additional Rental payable prior to the effective date
of termination or cancellation, except that the credit to be allowed for the
installment thereof payable on the first day of the month in which the
termination or cancellation is effective shall be prorated for the part of the
month the letting remains in effect, on the basis of the actual number of days
in such month, and
(14) On account of the Lessee's obligations to pay the Cost of
Assumable Maintenance and Repair set forth in Section 53 hereof entitled
"Assumption of Maintenance and Repair of the Premises by the Port Authority", an
amount equal to the total sum
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of the Capital Cost under said Section 53 hereof less the amount thereof payable
prior to the effective date of termination, and
(15) On account of the Lessee's obligations to pay the Costs of
the Condition Survey set forth in Section 54 hereof entitled "Joint Periodic
Condition Survey", an amount equal to the Costs of the Condition Survey under
said Section 54 hereof less the amount thereof payable prior to the effective
date of termination,
(16) An amount equal to all expenses reasonably incurred by the
Port Authority in connection with regaining possession and restoring and
reletting the demised premises, for legal expenses (including but not limited to
the cost to the Port Authority of in-house legal services), the care and
maintenance of the Premises during any period of vacancy, putting the premises
in order including, without limitation, cleaning, decorating and restoring (on
failure of the Lessee to restore), maintenance and brokerage fees and
commissions, and
(17) On account of the Lessee's obligations to pay the fifty
percent (50%) of the Port Authority's Cost of the Exit Baseline set forth in
Section 56 hereof, an amount equal to fifty percent (50%) of the Port
Authority's Cost of the Exit Baseline, less the amount thereof payable prior to
the effective date of termination.
(c) In addition to and without limiting the foregoing or any other
right, claim or remedy of the Port Authority, legal or equitable, under this
Lease or otherwise, in the event this Lease shall be terminated pursuant to
Section 20 hereof entitled "Termination by the Port Authority" and the Lessee
shall not have completed the Redevelopment Work, as defined in Section 2 hereof,
or any portion thereof, on the effective date of termination or cancellation,
the Lessee shall and hereby agrees to pay to the Port Authority any and all
amounts, costs and expenses, of any type whatsoever, paid or incurred by the
Port Authority by reason of the failure of the Lessee to complete the
Redevelopment Work, or any portion thereof, including without limitation all
interest, completion and other costs, damages, direct, indirect and
consequential, losses and penalties less the amount of Six Hundred Fifty-four
Million Seven Hundred Thousand Dollars and No Cents ($654,700,000.00), and all
of the same shall survive the termination or cancellation of this Agreement and
shall be deemed treated as survived damages hereunder in addition to those set
forth in paragraphs (a), (b) and (d) of this Section.
(d) Notwithstanding anything to the contrary herein contained but
subject to the terms and conditions of paragraph (u) of Section 56 hereof, all
of the obligations of the Lessee under this Lease with respect to Environmental
Damages and Environmental Requirements shall survive the expiration or
termination of this Agreement.
SECTION 24. RELETTING BY THE PORT AUTHORITY
The Port Authority upon termination or cancellation pursuant to
Section 20 hereof entitled "Termination by the Port Authority", or upon any
re-entry, regaining or resumption of possession pursuant to Section 21 hereof
entitled "Right of Re-entry", may occupy the Premises or may relet the Premises,
and shall have the right to permit any Persons, firm or corporation to enter
upon the Premises and use the same. Such reletting may be of part only of the
Premises or a part thereof together with other space, and for a period of time
the same as or different from the
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balance of the term hereunder remaining, and on terms and conditions the same as
or different from those set forth in this Agreement. The Port Authority shall
also, upon termination or cancellation pursuant to the said Section 20, or upon
its re-entry, regaining or resumption of possession pursuant to the said Section
21, have the right to repair or to make structural or other changes in the
Premises, including changes which alter the character of the Premises and the
suitability thereof for the purpose of the Lessee under this Agreement, without
affecting, altering or diminishing the obligations of the Lessee hereunder. In
the event either of any reletting or of any actual use and occupancy by the Port
Authority (the mere right of the Port Authority to use and occupy not being
sufficient however) there shall be credited to the account of the Lessee against
its survived obligations hereunder any net amount remaining after deducting from
the amount actually received from any lessee, licensee, permittee or other
occupier in connection with the use of the said Premises or portion thereof
during the balance of the letting as the same is originally stated in this
Agreement, or from the market value of the occupancy of such portion of the
Premises as the Port Authority may during such period actually use and occupy,
all expenses, costs and disbursements incurred or paid by the Port Authority in
connection therewith. No such reletting shall be or be construed to be an
acceptance of a surrender.
SECTION 25. REMEDIES TO BE NON-EXCLUSIVE
All remedies provided in this Agreement shall be deemed cumulative and
additional and not in lieu of or exclusive of each other or of any other remedy
available to the Port Authority or to the Lessee at law or in equity, and the
exercise of any remedy, or the existence herein of other remedies or indemnities
shall not prevent the exercise of any other remedy.
SECTION 26. SURRENDER
The Lessee covenants and agrees to yield and deliver peaceably to the
Port Authority possession of the Premises on the date of cessation of the
letting, whether such cessation be by termination, expiration or otherwise,
promptly and in good condition excepting reasonable wear and tear which does not
adversely affect the proper utilization of the Premises, and all of the Premises
shall be free and clear of all liens, encumbrances, and security interests and
of any rights of any sublessees or other occupants of the Premises, provided,
however, the foregoing provisions with respect to reasonable wear and tear shall
not apply to the environmental condition of the Premises and the obligations of
the Lessee with respect to the environmental condition of the Premises shall be
as set forth in Section 56 hereof.
SECTION 27. ACCEPTANCE OF SURRENDER OF LEASE
No agreement of surrender or to accept a surrender shall be valid
unless and until the same shall have been reduced to writing and signed by the
duly authorized representatives of the Port Authority and of the Lessee. Except
as expressly provided in this Section, neither the doing of, nor any omission so
to do, any act or thing, by any of the officers, agents or employees of the Port
Authority, shall be deemed an acceptance of a surrender of the letting or of
this Agreement.
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SECTION 28. BASIC LEASE
(a) The Lessee acknowledges that it has received a copy, and is
familiar with the contents, of the Basic Lease. The rights of the Port Authority
in the Premises are those granted to it by the Basic Lease, and no greater
rights are granted or intended to be granted to the Lessee than the Port
Authority has power thereunder to grant.
(b) In accordance with the provisions of the Basic Lease, the Port
Authority and the Lessee hereby agree as follows:
(1) This Lease is subject and subordinate to the Basic Lease and
to any interest superior to that of the Port Authority;
(2) The Lessee shall not pay rent or other sums under this
Agreement for more than one (1) month in advance (excluding security and other
deposits required under this Agreement);
(3) With respect to this Lease, the Lessee on the termination of
the Basic Lease will, at the option of The City of New York, attorn to, or enter
into a direct lease on identical terms with, the City;
(4) The Lessee shall indemnify the City, as a third party
beneficiary, with respect to all matters described in Section 31 of the Basic
Lease;
(5) The Lessee shall not use the Premises hereunder or any other
portion of the Airport for any use other than as permitted under the Basic
Lease;
(6) The Lessee shall use, operate and maintain the Premises
hereunder in a manner consistent with the Port Authority's obligations under
Section 28 of the Basic Lease;
(7) The failure of the Lessee to comply with the foregoing
provisions shall be an event of default under this Lease, which, after the
giving of reasonable notice, shall provide the Port Authority with the right to
terminate this Lease and exercise any other rights that the Port Authority may
have as the landlord hereunder; and
(8) The City shall be named as an additional insured or loss
payee, as applicable, under each policy of insurance procured by the Lessee
pursuant to this Lease.
(c) The rights and obligations of the Lessee with respect to
continuance of this Agreement upon the expiration or termination of the Basic
Lease shall be as set forth in paragraph (b)(3) of this Section and the Lessee
shall not enter into any recognition or nondisturbance agreement with the City
with respect to the continuance of this Lease after the termination or
expiration thereof or into any other agreement covering the Lessee's use and
occupancy of the Premises hereunder without the prior written consent of the
Port Authority.
(d) (i) Notwithstanding the provisions of paragraph (b)(4) of this
Section, it is hereby agreed that the Port Authority shall indemnify the Lessee
from and against all claims
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and demands of the City arising solely out of the contractual obligation of the
Lessee set forth in paragraph (b)(4) of this Section to the extent such claims
and demands do not relate to (w) the Lessee's use or occupancy of the Demised
Premises (as defined in the Basic Lease), or (x) the Lessee's exercise of rights
or privileges at the Demised Premises pursuant to a license, lease, permit or
other agreement (y) to the Lessee's ownership of any property at the Demised
Premises or (z) to any act, omission, inaction or neglect of the Lessee, except,
however, the foregoing clauses (w), (x), (y) and (z) shall not include any claim
or demand of the City arising out of any of the Condition Exceptions for which
the Lessee is not responsible for pursuant to paragraph (b)(2) of Section 56
hereof and claims and demands arising solely with respect to those terms and
conditions of the Remedial Action Work Plan which the Lessee is not responsible
for complying with pursuant to this Lease), (each claim and demand of the City
for which the Port Authority has agreed to indemnify the Lessee pursuant to this
paragraph (d)(i) is hereinafter referred to as an "Unrelated Claim").
(ii) The Lessee shall give prompt notice to the Port Authority of
the assertion of any Unrelated Claim, or the commencement of any action or
proceeding relating to an Unrelated Claim, specifying with reasonable
particularity the damages, loss, liability, or expense for which the Lessee
seeks indemnification, and the basis for the indemnity, and shall thereafter
promptly give the Port Authority all such information with respect thereto as
the Port Authority may request. The Lessee and its officers, directors,
employees and representatives shall fully cooperate in the defense of any action
or proceeding based upon any Unrelated Claim. The Port Authority shall have the
right to select the counsel, or to utilize counsel for its insurer, in
connection with the defense of any such action or proceeding, and shall have the
right to settle or compromise any such Unrelated Claim without the consent of
the Lessee, provided that such settlement or compromise does not require payment
from the Lessee and will result in a full release of the Lessee from any further
liability with respect to such Unrelated Claim. The Lessee shall have the right
to settle or compromise any Unrelated Claim only with the consent of the Port
Authority. A failure by the Lessee to give the Port Authority notice of an
Unrelated Claim shall relieve the Port Authority from its obligations under this
paragraph (d) to the extent the defense of such claim is prejudiced by the
Lessee's failure to give prompt notice thereof.
SECTION 29. REMOVAL OF PROPERTY
(a) Except as set forth in Sections 52 and 61 hereof, all personal
property (including trade fixtures) removable without material damage to the
Premises installed by the Lessee in or on the Premises and which is not owned by
the City of New York or the Port Authority pursuant to paragraph (k) of Section
2 hereof or otherwise shall be deemed to be and remain the property of the
Lessee (which personal property of the Lessee is hereinafter called the
"Lessee's Personal Property").
(b) All of the Lessee's Personal Property, provided that the Lessee
shall install suitable replacements therefor if such property is necessary to
operate the Premises in accordance with the terms and provisions hereof, may at
the Lessee's option be removed by the Lessee from the Premises at any time
during the term of the letting hereunder. Furthermore, notwithstanding the
previous sentence, all of the Lessee's Personal Property shall, unless otherwise
agreed in writing by the parties hereto, be removed by the Lessee on or before
the expiration or other termination of the term of the letting hereunder. Any of
the Lessee's Personal
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Property, except for Tanks (as defined in Section 61 hereof entitled "Storage
Tanks"), remaining on the Premises thereafter shall be deemed abandoned by the
Lessee. Without limiting any other term or provision of this Agreement, the
Lessee shall indemnify and hold harmless the Port Authority, its Commissioners,
officers, agents, employees and contractors from all claims of third persons
arising out of the Port Authority's removal and disposition of property so
abandoned by the Lessee, including claims for conversion, claims for loss of or
damage to the Lessee's Personal Property, claims for injury to Persons
(including death), and claims for any other damages, consequential or otherwise.
(c) The Lessee shall not remove from the Premises any property of the
City of New York or of the Port Authority without the prior written approval of
the Port Authority.
SECTION 30. BROKERAGE
Each party represents and warrants to the other that no real estate
broker has been concerned on its behalf in the negotiation of this Agreement and
that there is no real estate broker who is or may be entitled to be paid a
commission in connection therewith. Each party shall indemnify and save harmless
the other party of and from any claim for commission or brokerage made by any
and all Persons whatsoever for services to or on behalf of the indemnifying
party in connection with the negotiation and execution of this Agreement.
SECTION 31. LIMITATION OF RIGHTS AND PRIVILEGES GRANTED
(a) No greater rights or privileges with respect to the use of the
Premises or any part thereof are granted or intended to be granted to the Lessee
by this Agreement, or by any provision thereof, than the rights and privileges
expressly and specifically granted hereby.
(b) The Premises are let to the Lessee and the Lessee takes the same
subject to all the following: (i) easements, restrictions, reservations,
covenants and agreements, if any, to which the Premises are subject, rights of
the public in and to any public street, (ii) rights, if any, of any enterprise,
public or private which is engaged in furnishing heating, lighting, power,
telegraph, telephone, steam, or transportation services and of the City and
State of New York and (iii) permits, licenses, regulations and restrictions, if
any, of the United States, the City of New York or State of New York or other
Governmental Authority.
SECTION 32. NOTICES
Except where expressly required or permitted herein to be oral, all
notices, directions, requests, consents and approvals required to be given to or
by either party shall be in writing, and all such notices and requests shall be
personally delivered to the duly designated officer or representative of such
party or delivered to the office of such officer or representative during
regular business hours, or forwarded to him or to the party at such address by
certified or registered mail. The Lessee shall from time to time designate in
writing an office within the Port of New York District and an officer or
representative whose regular place of business is at such office upon whom
notices and requests may be served. Until further notice, the Port Authority
hereby designates its Executive Director, and the Lessee designates its Vice
President of Corporate Real Estate, as their officers upon whom notices and
requests may be served, and the
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Port Authority designates its office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, and the Lessee designates its office at ▇▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as their respective offices where notices and
requests may be served. If mailed, the notices herein required to be served
shall be deemed effective and served as of the date of the certified or
registered mailing thereof. The Port Authority may for informational purposes
only send a copy by regular first class mail of all such notices and requests to
the Lessee's General Counsel at the following address: ▇▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. Failure on the part of the Port Authority to send
the informational copy shall not however be or be deemed to be a breach of this
Agreement or impair or affect the validity of the notice or request actually
given.
SECTION 33. OTHER CONSTRUCTION BY THE LESSEE
(a) Except as expressly provided in Section 2 hereof, the Lessee shall
not erect any structures, make any improvements or do any other construction
work on the Premises or alter, modify, or make additions or improvements to any
structure now existing or built at any time during the letting, or install any
fixture (other than trade fixtures, removable without material damage to the
freehold, any such damage to be immediately repaired by the Lessee) without the
prior written approval of the Port Authority. In the event any construction,
improvement, alteration, modification or addition, is made without such prior
written approval of the Port Authority, then upon reasonable notice so to do,
the Lessee will remove the same, or at the option of the Port Authority cause
the same to be changed to the satisfaction of the Port Authority. In case of any
failure on the part of the Lessee to comply with such notice, the Port Authority
may effect the removal or change and the Lessee shall pay the cost thereof to
the Port Authority. In addition all the Construction Work shall be performed in
accordance with the terms and conditions of Section 2 hereof.
(b) Without limiting the generality of the foregoing paragraph the
Lessee acknowledges and agrees that the notes and their associated reference
lines set forth in the Exhibits to the Lease shall not constitute or be deemed
to constitute or imply that approval of the Port Authority will be granted to
any proposed construction by the Lessee nor shall the same grant or be deemed to
grant any right or permission to the Lessee now or in the future to erect any
structures, make any improvements or do any other construction work in the
Premises, including but not limited to paving, or to alter, modify or make
additions, improvements or repairs to or replacements of, any structure now
existing or built at any time during the letting or install any fixtures on the
Premises, including but not limited to paving, and that the provisions of the
foregoing paragraph of this Section shall be read and construed as if there were
no notes on the Exhibits and their associated reference lines, which were placed
on such Exhibits solely and exclusively for the benefit of the Port Authority.
(c) Notwithstanding the obligation of maintenance imposed upon the
Lessee by the provisions of Section 10 hereof, the Lessee shall not make any
repairs or replacements (except emergency repairs or replacements) unless and
until it has first obtained an approved Port Authority alteration application
for such repairs or replacements which shall then be performed in full
accordance with the terms of said alteration application.
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SECTION 34. PLACE OF PAYMENTS
All payments required of the Lessee by this Agreement shall be sent to the
following address:
THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY
P.O. BOX 95000-1517
PHILADELPHIA, PENNSYLVANIA 19195-1517
or via the following wire transfer instructions:
Bank: Commerce Bank
Bank ABA Number: ▇▇▇▇▇▇▇▇▇
Account Number: 5950011618
or to such other address, office or location as may hereafter be substituted
therefor by the Port Authority, from time to time, by notice to the Lessee.
SECTION 35. CONSTRUCTION AND APPLICATION OF TERMS
(a) The Section and paragraph headings, if any, in this Agreement, are
inserted only as a matter of convenience and for reference and in no way define,
limit or describe the scope or intent of any provision hereof.
(b) Unless otherwise expressly specified, the terms, provisions and
obligations contained in the Exhibits and Schedules attached hereto (whether
such terms, provisions and obligations are therein set out in full or as
amendments of, or supplements to provisions elsewhere in the Agreement stated)
shall have the same force and effect as if herein set forth in full.
(c) If any clause, provision or section of this Agreement shall be
ruled invalid by any court of competent jurisdiction, the invalidity of such
clause, provision or section shall not affect any of the remaining provisions
hereof.
(d) The fact that certain of the terms and provisions hereunder are
expressly stated to survive the expiration or termination of the letting
hereunder does not mean nor shall be construed to mean that those provisions
hereunder which are not expressly stated to survive shall terminate or expire on
the expiration or termination of the letting hereunder and do not survive such
termination or expiration.
(e) The parties agree that any rule of construction to the effect that
any ambiguities are to be resolved against the drafting party shall not be
applicable to the interpretations of this Agreement or any amendments, addenda
or supplements hereto or any Exhibits or Schedules hereto.
SECTION 36. NON-LIABILITY OF INDIVIDUALS
No Commissioner, director, officer, agent or employee of either party
shall be charged personally or held contractually liable by or to the other
party under any term or
144
provision of this Agreement or of any supplement, modification or amendment to
this Agreement or because of any breach thereof, or because of its or their
execution or attempted execution.
SECTION 37. ABATEMENT
If the Port Authority shall, for safety or other reasons, prohibit the
use of the Public Landing Area at the Airport or of any substantial part thereof
for foreign or domestic scheduled air transport operations for a period covering
more than sixty (60) consecutive days and the Lessee shall thereby be prevented
from conducting those operations at the Airport enumerated in Section 5 hereof
entitled "Use of Premises", then upon the occurrence of such event, the Lessee
at its option shall be entitled to abatement of rental during such period of
prohibition and prevention. In the event that the Lessee shall exercise such
option the Lessee shall be deemed to have released and discharged the Port
Authority of and from all claims and rights which the Lessee may have hereunder
arising out of or consequent upon such closing and the subsequent interrupted
use of such Public Landing Area or part thereof during the period of
prohibition.
SECTION 38. SERVICES TO THE LESSEE
Except as provided in this Section 38, the Port Authority shall not be
obligated to perform or furnish any services or utilities whatsoever in
connection with this Lease or the use and occupancy of the Premises.
(a) The Port Authority shall sell, furnish and supply to the Lessee
for use on the Premises and the Lessee agrees to take from the Port Authority
and pay for electricity of the same voltage, phase and cycle as supplied to the
Premises by the public utility in the vicinity, but limited however, to serve a
maximum of 10,400 KVA installed transformer capacity, at the same charge which
would be made by such public utility for the same quantity under the same
conditions and in the same service classification but in no event less than an
amount that would reimburse the Port Authority for its cost of obtaining and
supplying electricity to the Lessee hereunder; charges shall be payable by the
Lessee when billed and the quantity of electricity consumed shall be measured by
the meter or meters installed for the purpose; provided, however, that if for
any reason any meter or meters fail to record the consumption of electricity,
the consumption during the period such meter or meters are out of service will
be considered to be the same as the consumption for a like period either
immediately before or after the interruption as elected by the Port Authority.
The Port Authority shall not discontinue the supply of electricity except upon
fifteen (15) days' notice to the Lessee and unless a supply of electricity of
the same voltage, phase and cycle (subject to the KVA limitation aforesaid)
shall be available from another supplier and upon any such discontinuance the
Lessee shall be at liberty to contract or otherwise arrange for the supply of
such current after the expiration of said fifteen (15) days from any other
Person, firm or corporation. The Port Authority shall install and maintain the
appropriate meters.
(b) The Port Authority agrees to sell, furnish and supply to the
Lessee for use on the Premises cold water (of the character furnished by the
City of New York) in reasonable quantities through existing pipes, mains and
fittings and the Lessee agrees to take such water from the Port Authority and to
pay the Port Authority therefor an amount equal to that which
145
would be charged by the municipality or other supplier of the same (whether or
not representing a charge for water or other services measured by water
consumption) for the same quantity, used under the same conditions and in the
same service classification plus the cost to the Port Authority of supplying
such water which shall not be less than ten percent (10%) nor in excess of fifty
percent (50%) of the amount charged. The charge therefor shall be payable by the
Lessee when billed and the quantity of water consumed shall be measured by the
meter or meters installed for the purpose; provided, however, that if for any
reason, any meter or meters fail to record the consumption of water, the
consumption during the period such meter or meters are out of service will be
considered to be the same as the consumption for a like period immediately
before or after the interruption, as elected by the Port Authority. The Port
Authority shall install and maintain the appropriate meters. In the event meters
are not installed to measure the consumption of water under high pressure, the
quantity of such water used by the Lessee will be based upon equitable estimates
of consumption, which estimates shall be deemed binding on the Lessee.
(c) The Lessee shall pay to the Port Authority such of the existing
and future charges for sewerage services furnished by the City of New York as
are presently or may hereafter be imposed or assessed against the Port Authority
in respect of the Premises or its use and occupancy thereof. In the event that
the City or the State of New York is now furnishing services with or without
charge therefor, which are beneficial to the Lessee in its use and occupancy of
the Premises, and shall hereafter impose charges or increase existing charges
for such services, the Lessee agrees to pay to the Port Authority such of the
charges or the increase in charges as may be imposed or assessed against the
Port Authority in respect to the Premises or its use and occupancy thereof.
(d) In the event the Port Authority shall provide extermination
service for the enclosed areas of the Premises, the Lessee agrees to utilize the
same and to pay its pro rata share of the reasonable cost thereof upon demand.
This paragraph does not impose any obligation on the Port Authority to furnish
such service.
(e) The Port Authority shall be under no obligation to supply services
if and to the extent and during any period that the supplying of any such
service or the use of any component necessary therefor shall be prohibited or
rationed by any federal, state or municipal law, rule, regulation, requirement,
order or direction and if the Port Authority deems it in the public interest to
comply therewith, even though such law, rule, regulation, requirement, order or
direction may not be mandatory on the Port Authority as a public agency.
(f) No failure, delay or interruption in supplying agreed services
(whether or not a separate charge is made therefor) shall be or be construed to
be an eviction of the Lessee or grounds for any diminution or abatement of
rental, or (unless resulting from the negligence or wilful failure of the Port
Authority) shall be grounds for any claim by the Lessee for damages,
consequential or otherwise.
SECTION 39. HOT WATER AND CHILLED WATER REQUIREMENTS
(a) (1) The Port Authority has entered into agreements consisting of
an Energy Purchase Agreement, dated as of April 28, 1993, a Construction and
Operations
146
Agreement, dated as of April 28, 1993, and an Agreement of Lease, dated as of
April 28, 1993, (all of the foregoing Agreements hereinafter as the same may be
supplemented, amended and extended from time to time collectively and
individually called the "Cogeneration Agreement") with KIAC Partners, a New York
general partnership (hereinafter called "KIAC"), for the construction,
installation and operation of a cogeneration facility at the Airport which
includes portions of the central heating and refrigeration facility previously
operated by the Port Authority at the Airport and which cogeneration facility
produces electricity, hot water (hereinafter called "Hot Water") and chilled
water (hereinafter called "Chilled Water") and which cogeneration facility is
hereinafter called the "Cogeneration Facility". The Cogeneration Facility shall
include a thermal distribution system (the "TDS") including distribution lines
extending to the Premises as provided in paragraph (f) below.
(2) The Lessee acknowledges that it has received a copy of the
Cogeneration Agreement and agrees that the supply by KIAC of Hot Water and
Chilled Water to the Premises is subject to all of the terms and provisions of
the Cogeneration Agreement. The Lessee agrees that the Port Authority may grant
waivers, consents and approvals to KIAC from time to time and the Port Authority
and KIAC may, except to the extent provided in paragraph (i) below, supplement,
amend or extend the Cogeneration Agreement from time to time and that the Lessee
shall be subject to any such waivers, consents and approvals and supplements,
amendments, and extensions as part of the Cogeneration Agreement. Copies of any
such supplements, amendments and extensions will be made available to the Lessee
upon request by the Lessee therefor.
(b) (1) The Cogeneration Agreement provides, among other things, that
the Port Authority will purchase from KIAC for resale to the Lessee, and the
Lessee hereby agrees that it will accept and purchase from the Port Authority
subject to all of the terms and conditions of the Cogeneration Agreement, for
use on the Premises, to the extent the same is delivered by KIAC to the Port
Authority and by the Port Authority to the Lessee, all of the Lessee's
requirements at the Premises for Hot Water and Chilled Water (excluding
requirements exclusively for aircraft and loading bridges leading to aircraft);
and the Lessee hereby agrees to pay the Port Authority therefor as follows:
(i) The Lessee acknowledges and agrees that the charge to
the Lessee by the Port Authority for the Lessee's consumption of Hot Water and
Chilled Water at the Premises and Chilled Water makeup water and chemical
treatment of makeup water (due to system leakage at the Premises or otherwise)
shall be the sum of (A) the amount payable by the Port Authority to KIAC
therefor pursuant to the Cogeneration Agreement, plus (B) Five Percent (5%) of
the foregoing and plus (C) all applicable taxes.
(ii) The Lessee acknowledges that pursuant to the
Cogeneration Agreement KIAC will furnish the Port Authority with measurements of
the Lessee's consumption of (A) Hot Water based upon energy drawn by the Lessee
from KIAC's Hot Water distribution lines, (B) Chilled Water based upon the
energy absorbed from the Lessee by KIAC's Chilled Water distribution lines and
(C) Chilled Water makeup water and chemical treatment of makeup water consumed
on the Premises, and the Lessee agrees that the provisions of the Cogeneration
Agreement with respect to the accuracy of such measurements, the
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determination of such measurements in the event of inaccurate registration by
metering devices, and the use of estimates in the event of the failure of such
metering devices shall all be applicable to the Lessee under this Agreement as
though set forth in full herein.
(iii) The Lessee acknowledges that the Cogeneration
Agreement provides that KIAC shall provide estimated bills to the Port Authority
for consumption of Hot Water and Chilled Water on a monthly basis on or about
the tenth (10th) day of the month for each calendar month. KIAC is then to
render a final bill with respect to each estimated bill approximately ten (10)
days after the conclusion of the said month together with the estimated bill for
the then current month.
(iv) Notwithstanding such arrangement between KIAC and the
Port Authority, the Port Authority shall, with respect to each calendar year or
fraction thereof, establish estimated unit rates, subject to change from time to
time by the Port Authority, for the consumption on the Premises of Hot Water and
Chilled Water and shall render an estimated bill to the Lessee for the
consumption at the Premises at such estimated rates monthly on the last day of
the calendar month following each full or partial calendar month during the term
hereof which bill shall be payable on receipt.
(v) As soon as practicable after the expiration of each
calendar year, the Port Authority shall determine the amounts payable by the
Lessee in accordance with the provisions of subparagraphs (i), (ii) and (iii) of
this paragraph (b)(1). A corrected billing based upon such determination shall
thereupon be rendered by the Port Authority to the Lessee and if any monies are
due to the Port Authority they shall be promptly paid by the Lessee and if any
monies are due to the Lessee they shall be credited to it. In the event the term
of this Agreement expires or is sooner terminated on a date other than the last
day of a calendar year, the Port Authority shall have no obligation to
immediately make the computations as hereinabove provided which would determine
the amounts payable by the Lessee in accordance with subparagraphs (i), (ii) and
(iii) of this paragraph (b)(1) for the period during said year when this
Agreement was in effect. In the event this Agreement expires on a day other than
the last day of a calendar month and the actual consumption of and charges to
the Lessee for such portion of the calendar month are not available, the charge
to the Lessee shall be equitably prorated. Said computations shall be made
subsequent to the end of the calendar year as hereinabove provided, and if any
monies are due to the Port Authority they shall be paid by the Lessee and if any
monies are due to the Lessee they shall be paid to it by the Port Authority less
such amounts, if any, then due and owing to the Port Authority from the Lessee.
(vi) The Port Authority shall render a bill to the Lessee
from time to time for the Lessee's Chilled Water distribution gallonage which
shall be payable upon receipt. The charge therefor shall be based on KIAC's
charge to the Port Authority for makeup water and chemical treatment of makeup
water and shall be determined in accordance with subparagraphs (i) and (ii) of
this paragraph (b)(1).
(vii) In the event that the Lessee disputes any item of an
estimated or final bill, the Lessee shall promptly pay the bill in full and the
Port Authority shall make any necessary adjustments only after resolution of
such dispute.
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(2) The Lessee agrees that in order that KIAC or any successor
thereto may maintain the status of the Cogeneration Facility as a "qualifying
cogeneration facility" under applicable Federal laws, rules and regulations ("QF
Status") including the Public Utility Regulatory Policies Act of 1978 as the
same may be amended and any successor statute thereto, the Lessee shall, at all
times it is operating at the Premises for the purposes permitted in this
Agreement, purchase from the Port Authority and use on an annual basis a minimum
amount of thermal energy contained in Hot Water and Chilled Water produced by
use of steam from the Cogeneration Facility equivalent to the lesser of (1) an
amount that, together with all thermal energy contained in Hot Water and Chilled
Water purchased and used by the Port Authority and all other lessees of premises
in the Central Terminal Area, is sufficient to maintain the QF Status of the
Cogeneration Facility and (2) the product of (x) 167,379 mm BTUs of thermal
energy, which is one-third of the use of thermal energy contained in Hot Water
and Chilled Water in the Central Terminal Area of the Port Authority and the
lessees of premises in the Central Terminal Area in the year ending December 31,
1989, and (y) a fraction, the numerator of which is the amount of the use of
thermal energy contained in Hot Water and Chilled Water at the Premises in the
most recent complete calendar year preceding the applicable date of
determination and the denominator of which is the amount of all use in the
Central Terminal Area of thermal energy contained in Hot Water and Chilled Water
in such calendar year.
(3) It is agreed that during or subsequent to the expiration of
this Agreement no charge to or payment by the Lessee with respect to Hot Water,
Chilled Water or Chilled Water distribution gallonage shall be included in,
affect, or change in any way the calculation and determination of Port Authority
costs or charges under any other agreement between the Lessee and the Port
Authority at the Airport and any such Port Authority cost or charge shall be
calculated and determined as if no charge to or payment by the Lessee with
respect to Hot Water, Chilled Water or Chilled Water distribution gallonage had
been incurred.
(c) THE LESSEE HEREBY WAIVES AND RELINQUISHES for itself, its
successors and assigns any right it may have, and further agrees that it, its
successors and assigns shall have no right, to manufacture or produce, to cause
to be manufactured or produced, or to purchase or receive from any third party,
Hot Water or Chilled Water for use on the Premises or to use any other manner of
air cooling or air heating at the Premises except to purchase, receive and use
Hot Water and Chilled Water from the Port Authority pursuant to this Agreement.
(d) There shall be no obligation to the Lessee by either KIAC or the
Port Authority to furnish the goods and services covered by this Section at any
time (i) while any component necessary therefor shall be prohibited or rationed
by any federal, state or municipal, law, rule, regulation, requirement, order or
direction or while the Port Authority deems it in the public interest to comply
therewith even though such law, rule, regulation, requirement, order or
direction may not be mandatory on the Port Authority as a public agency, (ii)
while the same are curtailed or stopped because of the need to repair, replace,
rebuild or alter the Cogeneration Facility, (iii) during the continuance of any
event of Force Majeure, as such term is defined in the Cogeneration Agreement or
(iv) that the Lessee shall be in default under this Agreement after the period,
if any, herein granted to cure such default shall have expired. No failure,
delay or interruption in supplying said goods and services shall be or be
construed to be an eviction of the
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Lessee or grounds for the diminution or abatement of rentals, fees or other
charges, nor shall any such failure, delay or interruption be grounds for any
claim by the Lessee for damages, consequential or otherwise, against the Port
Authority or KIAC.
(e) Without limiting any other provision of this Section, any supply
of Hot Water or Chilled Water to the Premises from the Cogeneration Facility
shall be limited by the safe and efficient operating capacity of the
Cogeneration Facility as determined by KIAC and as approved by the Port
Authority.
(f) (1) The Lessee shall install all machinery, equipment and
facilities, including heat exchangers, required to be installed in the Premises
in order to utilize Hot Water and Chilled Water to be distributed and shall tie
into the TDS in the mechanical equipment rooms constructed by the Lessee on the
Premises.
(2) The Lessee hereby agrees that the Port Authority, KIAC and
the contractors or suppliers of either of them shall have the right to enter
upon the Premises to install, operate and maintain any part of the Cogeneration
Facility located thereon including but not limited to the TDS and any heat
exchangers installed by the Port Authority or KIAC.
(g) In the event the Cogeneration Agreement is terminated and the
facilities for the production of Hot Water and Chilled Water at the Airport
exist and are, in the opinion of the Port Authority, economically operable, the
Port Authority itself or pursuant to agreement with a contractor or permittee
shall supply Hot Water and Chilled Water to the Premises and the Lessee shall
take and pay therefor at the same charge to the Lessee which would be applicable
as if the Cogeneration Agreement had been in full force and effect, provided,
however, that notwithstanding any other provision of this Section, the charge
therefor to the Lessee shall in no event be less than an amount that would
reimburse the Port Authority for its capital and operating costs in connection
therewith determined in accordance with the Port Authority's normal accounting
practice. In addition, the Port Authority may, in its discretion, make or
consent to arrangements on one or more occasions with a third party or parties
to succeed to KIAC's operation of all or any part of the Cogeneration Facility
and the Lessee shall continue to be obligated to purchase Hot Water and Chilled
Water from the Port Authority pursuant to this Agreement, at the rates provided
for in the Cogeneration Agreement.
(h) The Port Authority shall have no liability to the Lessee for any
facilities installed by the Lessee on the Premises in connection with the use of
Hot Water and Chilled Water hereunder or for any investment made in connection
with the use of Hot Water and Chilled Water.
(i) The Port Authority shall have the right to grant waivers, consents
and approvals with respect to the Cogeneration Agreement and to enter into
amendments, supplements or extensions of the Cogeneration Agreement with KIAC or
any similar agreement with any successor operator of the Cogeneration Facility
or other provider of Hot Water and Chilled Water at the Airport, provided,
however, that the Port Authority will not enter into any amendment, supplement
or extension of the Cogeneration Agreement which will result in a change in the
formula used to calculate the Hot Water and Chilled Water rates payable by the
Lessee which change results in an increase in the rates payable by the
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Lessee pursuant to such formula (the Lessee hereby acknowledging that such
formula may, according to its terms, provide for such rates to be adjusted from
time to time) without the consent of the lessees (including the Port Authority
as and to the extent that the Port Authority uses Hot Water and Chilled Water)
of premises that purchased and used at least Fifty-one percent (51%) of the
aggregate Hot Water and Chilled Water purchased and used in the Central Terminal
Area during the last full calendar year preceding the effective date of such
amendment, supplement or extension.
SECTION 40. JFK FLIGHT FEES AGREEMENT AND AIRPORT FUELING AGREEMENTS
(a) It is recognized that the JFK Flight Fees Agreements and the
principles and formula set forth therein for the calculation of flight fees,
including the costs recovery accounting principles, have by agreement become the
basis for determining flight fees payable by various Aircraft Operators at the
Airport who are the actual signatories to JFK Flight Fees Agreements. In the
event of the expiration and non-extension or non-renewal of the JFK Flight Fees
Agreement, the same formula, accounting principles and costs recovery
methodology now set forth in the JFK Flight Fees Agreements for the calculation
of flight fees shall continue to be utilized for the calculation of flight fees
at the Airport for the Lessee until such time as the JFK Flight Fees Agreements
are formally replaced by a new agreement or agreements or by a new policy or
policies. The Port Authority has advised the Lessee that it is the intention of
the Port Authority that with respect to the formula, accounting principles and
the costs recovery methodology for the calculation of flight fees upon the
expiration and non-extension or non-renewal of the JFK Flight Fees Agreements
all Aircraft Operators at the Airport which are similarly situated will be
treated in a similar manner.
(b) The parties hereto agree that in the event any provisions
contained in the Lessee's JFK Flight Fees Agreement conflict with any one or
more provisions of this Lease, the provisions this Lease shall control with
respect to all areas and subject matters covered by this Lease, except only as
to the Lessee's operations on the Public Aircraft Facilities at the Airport and
to the extent that any of the provisions of this Lease conflict with the
provisions of the Lessee's JFK Flight Fees Agreement concerning the rights and
obligations as to operations on the Public Aircraft Facilities at the Airport,
the Lessee's JFK Flight Fees Agreement shall control with respect to rights and
obligations as to operations of the Public Aircraft Facilities at the Airport.
SECTION 41. FEDERAL AIRPORT AID
The Port Authority has applied for and received a grant or grants of
money from the Administrator of the Federal Aviation Administration pursuant to
the Airport and Airways Development Act of 1970, as the same has been amended
and supplemented or superseded by similar federal legislation, and under prior
federal statutes which said Act superseded and the Port Authority may in the
future apply for and receive further such grants. In connection therewith the
Port Authority has undertaken and may in the future undertake certain
obligations respecting its operation of the Airport and the activities of its
contractors, lessees and permittees thereon. The performance by the Lessee of
the covenants and obligations contained in this Lease is therefore a special
consideration and inducement to the making of this Agreement by the Port
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Authority, and the Lessee further covenants and agrees that if the Administrator
of the Federal Aviation Administration or any other governmental officer or body
having jurisdiction over the enforcement of the obligations of the Port
Authority in connection with Federal Airport Aid shall make any orders,
recommendations or suggestions respecting the performance by the Lessee of its
covenants and obligations under this Agreement, the Lessee will promptly comply
therewith at the time or times, when and to the extent that the Port Authority
may direct.
SECTION 42. REQUESTING AIRLINES AT THE AIRPORT
(a) Requesting Airlines:
(1) If at any time from and after the First Enplanement Date to
and including the day preceding the fifth (5th) anniversary of DBO, a Scheduled
Aircraft Operator advises the Lessee that it would like the Lessee to make
Accommodations available to it at the Premises, the Lessee in furtherance of the
public interest of having the Premises fully and most effectively utilized shall
use reasonable efforts to provide Accommodations to said Scheduled Aircraft
Operator. If the Lessee fails to reach agreement with said Scheduled Aircraft
Operator for such Accommodations, the Lessee shall advise the Port Authority to
such effect. Thereafter, the Port Authority shall make a determination as to
whether the Lessee should provide Accommodations to the Scheduled Aircraft
Operator as requested and if so, whether there are any limitations on the
nature, cost, duration and extent of such Accommodations.
(2) If at any time from and after the fifth (5th) anniversary of
DBO, a Scheduled Aircraft Operator advises the Lessee that it would like the
Lessee to make Accommodations available to it at the Premises, the Lessee in
furtherance of the public interest of having the Premises fully and most
effectively utilized shall use its best efforts to provide Accommodations to
said Scheduled Aircraft Operator. If the Lessee fails to reach agreement with
said Scheduled Aircraft Operator for such Accommodations, the Lessee shall
advise the Port Authority to such effect. Thereafter, the Port Authority shall
make a determination as to whether the Lessee should provide Accommodations to
the Scheduled Aircraft Operator as requested and if so, whether there are any
limitations on the nature, cost, duration and extent of such Accommodations.
(3) The term "Requesting Airline" shall mean any Scheduled
Aircraft Operator which has advised the Lessee that it would like the Lessee to
make Accommodations available to it at the Premises and any Scheduled Aircraft
Operator that the Port Authority has determined must be accommodated at the
Premises as provided for in this paragraph (a).
(4) The determinations made by the Port Authority pursuant to
subparagraphs (a)(1) and (a)(2) of this Section shall be made on a reasonable
basis taking into consideration at a minimum the following factors: (i) the
requirements and obligations of the Port Authority pursuant to law, grant
assurances, agreement and otherwise, including without limitation, as the
operator of the Airport and as an applicant for and recipient of governmental
grants, federal airport aid, passenger facility charges and other monies, (ii)
operational considerations of the Port Authority and of the Airport, (iii) the
then existing utilization of Gates at the Premises by the Lessee compared with
the then existing utilization of aircraft gates at the other passenger terminals
in the CTA, (iv) the actual and projected growth of the number of
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Enplanements of the Lessee, (v) the compatibility of the flights, schedules,
flight times, operations, operating practices and aircraft equipment of the
Requesting Airline with those of the Lessee and (vi) the need for labor harmony.
(5) Any Accommodation Agreement between the Lessee and the
Requesting Airline made in accordance with any of the foregoing provisions of
this Section 42, shall be submitted by the Lessee to the Port Authority for its
consent, which will be in the form of a consent agreement prepared by the Port
Authority and to be executed by the Lessee, the Requesting Airline and the Port
Authority.
(6) Nothing in this Section shall be deemed to abrogate, change
or affect any restrictions, limitations or prohibitions on assignment,
subletting or use of the Premises by others under this Lease and shall not in
any manner affect, waive or change any of the provisions thereof.
(b) Section 42 Notice to Provide Accommodations to a Requesting
Airline:
(1) If the Port Authority shall make a determination under
paragraph (a) of this Section 42 that the Lessee is to provide Accommodations to
a Requesting Airline, then in addition to and without limiting each and every
other right the Port Authority has under this Agreement or otherwise, the Port
Authority as to any and each such Requesting Airline, shall have the right, upon
ninety (90) days' notice to the Lessee (each such notice a "Section 42 Notice to
Provide Accommodations" and each said 90-day period, the "Section 42 Notice
Period") to require the Lessee to make available and provide Accommodations to
such Requesting Airline at the Premises as directed by the Port Authority.
(2) The Lessee shall, and hereby agrees, on or before the
expiration of the Section 42 Notice Period under each such Section 42 Notice to
Provide Accommodations, to provide Accommodations to the Requesting Airline in
accordance with said Section 42 Notice to Provide Accommodations, provided,
however, the Lessee shall not be relieved from its obligation to provide such
Accommodations to the Requesting Airline if Lessee and the Requesting Airline
shall have failed to execute an Accommodations Agreement unless the Lessee shall
have tendered to the Requesting Airline a form of Accommodations Agreement
described in paragraph (c)(6) of this Section and which is in accordance with
the Section 42 Notice to Provide Accommodations and the Requesting Airline shall
not have executed such form of Accommodations Agreement after tender thereof to
it for execution. The Lessee shall accept information from the Requesting
Airline and/or the Port Authority with respect to the Requesting Airline's
scheduled arrivals and departures for each Gate specified in the Section 42
Notice to Provide Accommodations and the Lessee shall provide Accommodations to
the Requesting Airline in such manner so as to properly meet the Requesting
Airline's schedule and needs for Accommodations as to each applicable Gate for
its said scheduled arrivals and departures.
(3) Without limiting the foregoing, upon its receipt of such
Section 42 Notice to Provide Accommodations the Lessee shall use its best
efforts to enter into an Accommodations Agreement in the form described in
paragraph (c)(6) of this Section with the
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Requesting Airline in accordance with the Section 42 Notice to Provide
Accommodations; provided, however, that any failure of the Lessee and the
Requesting Airline to execute such Accommodations Agreement shall not relieve or
release the Lessee from its obligations hereunder to provide Accommodations to
the Requesting Airline in accordance with all of the foregoing and the Section
42 Notice to Provide Accommodations unless the Lessee shall have tendered to the
Requesting Airline a form of Accommodations Agreement described in paragraph
(c)(6) of this Section and which is in accordance with the Section 42 Notice to
Provide Accommodations and the Requesting Airline shall not have executed such
form of Accommodations Agreement after tender thereof to it for execution.
(c) Accommodations:
(1) The Requesting Airline may handle itself or may be handled by
any Person who holds a permit from the Port Authority to provide handling
services at the Airport.
(2) In addition, the Requesting Airline may be handled by the
Lessee subject to the terms and conditions of this Lease, including without
limitation the following. Each sublease or Handling Agreement entered into
between the Requesting Airline and the Lessee shall be subject to the prior and
continuing approval of the Port Authority and the execution among the Port
Authority, the Lessee, and the Requesting Airline of a form of consent agreement
prepared by the Port Authority.
(3) Except for the requirements set forth in subparagraph (6) of
this paragraph (c), nothing contained in this Section shall in any way affect
the discretion of the Port Authority in granting or withholding its consent to
an Accommodations Agreement proposed by the Lessee or directed by the Port
Authority and such consent may contain such terms and conditions including but
not limited to such financial or other conditions which may include a fixed
charge or a charge based upon a percentage of the Lessee's gross receipts
arising therefrom, as the Port Authority may, at that time, elect, and all
provisions of the Lease requiring the prior written consent or approval of the
Port Authority.
(4) Notwithstanding anything to the contrary contained herein the
Lessee understands and agrees that the Lessee shall not perform any services and
functions for a Requesting Airline pursuant to an Accommodations Agreement with
respect to which the Port Authority has specifically withheld consent and
approval in the consent agreement to such Accommodations Agreement. The
Requesting Airline may either perform said services and functions itself or use
the services of the service organization authorized by the Port Authority,
including but not limited to in-flight caterers, aircraft fuelers, and ramp
handlers performing such services or functions at the Airport. The Lessee
however may make the necessary arrangements (subject to Port Authority consent
where required) with the authorized service organization performing such
services and functions performed for the Requesting Airline.
(5) The Lessee shall furnish to the Port Authority from time to
time such itemization, details and information pertaining to the Accommodations
provided to each Requesting Airline and Accommodations Agreement as the Port
Authority may from time to
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time request. Moreover, and without limiting the foregoing, the Lessee will at
all times keep the Port Authority informed and advised and will consult with the
Port Authority from time to time as to all aspects of its Accommodations of
Scheduled Aircraft Operators hereunder.
(6) The Lessee agrees that all services, facilities, equipment
and other items provided by the Lessee to each Requesting Airline under an
Accommodations Agreement (or otherwise) shall be at reasonable and at
non-discriminatory rates, fees and charges, which rates, fees and charges shall
be based upon the proper recovery by the Lessee of a pro rata share of the
Lessee's costs of (i) operation and maintenance of the Premises, (ii) the
services provided to the Accommodated Handled Airline or the Accommodated
Sublessee Airline, (iii) the Lessee's investment in the Premises not otherwise
included in the above and (iv) the fees and rentals paid to the Port Authority
under this Agreement. Further, each Accommodations Agreement shall include
(unless not required by the Lessee) that the Requesting Airline indemnify and
hold the Lessee harmless from any injury, loss and/or damages associated with
the Requesting Airline's use or occupancy of the applicable portions of the
Premises; that the Requesting Airline provide the Lessee with a certificate of
insurance evidencing that the Requesting Airline maintains insurance in
accordance with the requirements set forth in the Port Authority's consent to
the Accommodations Agreement and that the Lessee is named as an additional
insured on such insurance; that the Requesting Airline agrees to be bound by
those terms and conditions of the Lease applicable to the Requesting Airline;
and that the Requesting Airline deposit with the Lessee a security deposit with
the Lessee in an amount equivalent to all charges, fees, rentals, and other
amounts payable by the Requesting Airline to the Lessee pursuant to the
Accommodations Agreement for a period of not greater than two months.
(d) Section 42 Gate Termination:
(1) The terms and provisions of this paragraph (d) shall become
and be effective from and after the fifth (5th) anniversary of DBO.
(2) In the event that at the expiration of the Section 42 Notice
Period the Lessee shall fail to provide Accommodations to the Requesting Airline
named in the Section 42 Notice to Provide Accommodations triggering such Section
42 Notice Period, the Port Authority may, upon at least thirty (30) days' notice
to the Lessee (each a "Section 42 Gate Termination Notice"), terminate the
letting of any number or all of the Gates specified in said Section 42 Notice to
Provide Accommodations and all Gate Related Premises applicable thereto as
specified in such Section 42 Notice to Provide Accommodations. In the event the
Port Authority gives a Section 42 Gate Termination Notice in accordance with the
foregoing, the termination of the Gate or Gates and Gate Related Premises
specified in such notice shall be effective on the date set forth in said
Section 42 Gate Termination Notice ("Section 42 Gate Termination Date").
(3) The Port Authority's rights to terminate one or more Gates
and Gate Related Premises as set forth in this Section 42 may be exercised from
time to time and as to one or more than one Requesting Airline, without waiving,
limiting or impairing any other rights and remedies of the Port Authority under
this Agreement or otherwise.
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(4) As to each Section 42 Gate Termination Notice, upon such
termination, the term of the letting as to the terminated portion or portions of
the Premises (i.e. Gate(s) and Gate Related Premises) shall cease and expire on
the effective date set forth in said Section 42 Gate Termination Notice with the
same force and effect as if said date were the date originally stated in this
Agreement for the expiration of the term of the letting as to said portion or
portions of the Premises. This Agreement and the letting as to all other
portions of the Premises (excluding all other previously terminated portions
thereof) shall continue in full force and effect.
(5) "Section 42 Terminated Gate" shall mean each Gate and its
Gate Related Premises for which the letting is terminated pursuant to the
provisions of this Section 42.
(e) Adjustment of Rentals in the Event of a Section 42 Gate
Termination:
In the event of the termination of any portion or portions of the
Premises (i.e. Gate(s) and Gate Related Premises) pursuant to a Section 42 Gate
Termination Notice the rentals payable under this Lease shall not be abated but
instead the following rentals, and only such rentals, shall be adjusted as
follows, which adjustment shall be subject to and conditioned on the Lessee's
continued compliance with the terms and conditions set forth in paragraphs (g)
and (h) below, and shall be made only during such times that the Lessee shall be
in compliance with paragraphs (g) and (h) below and shall provide full and
unrestricted access, ingress and egress to the Section 42 Terminated Gate(s) to
the Port Authority and each user of the Section 42 Terminated Gate(s) and their
employees, agents, representative and contractors:
(i) For each Section 42 Terminated Gate, from and after the
later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Second Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Second Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 43 hereof, by
the Pro-Rata Share.
(ii) For each Section 42 Terminated Gate, from and after the
later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Third Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Third Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 43 hereof, by
the Pro-Rata Share.
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(iii) For each Section 42 Terminated Gate, from and after
the later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Fourth Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Fourth Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 43 hereof, by
the Pro-Rata Share.
(iv) With respect to each Section 42 Gate Termination
Notice, for the purpose of calculating the Second Enplanement Rental payable by
the Lessee to the Port Authority hereunder from and after the later to occur of
the Section 42 Gate Termination Date applicable to such Section 42 Terminated
Gate and the date that the Lessee shall have actually surrendered and vacated
such Section 42 Terminated Gate in accordance with all the applicable provisions
of this Lease, (x) the amount of the Base Enplanement Rental, as the same may
have been previously reduced pursuant to the provisions of this Section 42 or
Section 43 hereof, shall be reduced by subtracting therefrom an amount equal to
the product obtained by multiplying the number of Gates terminated by such
Section 42 Gate Termination Notice by the product obtained by multiplying the
Initial Base Enplanement Rental by the Pro-Rata Share, and (y) the amount of the
Minimum Enplanement Rental, as the same may have been previously reduced
pursuant to the provisions of this Section 42 and Section 43, shall be reduced
by subtracting therefrom, an amount equal to the product obtained by multiplying
the number of Gates terminated by such Section 42 Gate Termination Notice by the
product obtained by multiplying the Initial Minimum Enplanement Rental by the
Pro-Rata Share, and (z) the Variable Enplanement Rental, as the same may have
been previously reduced pursuant to the provisions of this Section and Section
43 hereof, shall be reduced by subtracting therefrom an amount equal to the
product obtained by multiplying the number of Gates terminated by such Section
42 Gate Termination Notice by the product obtained by multiplying such Variable
Enplanement Rental, by the Pro-Rata Share.
(v) For each Section 42 Terminated Gate, from and after the
later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the First
Additional Rental payable by the Lessee to the Port Authority hereunder shall be
reduced by an amount equal to the product obtained by multiplying the amount of
such installment of First Additional Rental that would have been payable by the
Lessee under this Lease if there had not been any termination at any time of any
Gates and Gate Related Premises pursuant to this Section or pursuant to Section
43 hereof, by the Pro-Rata Share.
(vi) For each Section 42 Terminated Gate, from and after the
later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Third
Additional Rental payable by the Lessee to the Port Authority hereunder shall be
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reduced by an amount equal to the product obtained by multiplying the amount of
such installment of Third Additional Rental that would have been payable by the
Lessee under this Lease if there had not been any termination of any Gates and
Gate Related Premises pursuant to this Section or pursuant to Section 43 hereof,
by the Pro-Rata Share.
(vii) For each Section 42 Terminated Gate, from and after
the later to occur of the Section 42 Gate Termination Date applicable to such
Section 42 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 42 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Fifth
Additional Rental payable by the Lessee to the Port Authority hereunder shall be
reduced by an amount equal to the product obtained by multiplying the amount of
such installment of Fifth Additional Rental that would have been payable by the
Lessee under this Lease if there had not been any termination of any Gates and
Gate Related Premises pursuant to this Section or pursuant to Section 43 hereof,
by the Pro-Rata Share.
(f) Payment of Pro-Rata Share of ▇▇▇▇▇▇'s Unamortized Investment in
the Event of a Section 42 Gate Termination:
Within sixty (60) days after the later to occur of a Section 42
Gate Termination Date and the date that the Lessee shall have actually
surrendered and vacated in accordance with all applicable provisions of this
Lease all of the Section 42 Terminated Gate(s) for which such Section 42 Gate
Termination Date is applicable, the Port Authority shall, with respect to each
such Section 42 Terminated Gate, make a one-time payment to the Lessee in the
amount equal to the product obtained by multiplying the Pro-Rata Share by the
Lessee's Unamortized Investment. The foregoing payments shall be subject to the
Port Authority's rights of audit and inspection and shall be subject to the
record-keeping obligations of the Lessee under Section 65 hereof.
(g) Services to Section 42 Terminated Gate(s):
The Lessee shall cooperate with the Port Authority in
arrangements at the Premises so that each Aircraft Operator who uses a Section
42 Terminated Gate may handle itself or be handled by a handling permittee of
the Port Authority of its choice, subject to prior written consent of the Port
Authority and payment of all applicable fees to the Port Authority. In the event
that the Lessee wishes to perform handling services for any such Aircraft
Operator, the Lessee shall not do so unless the Lessee has obtained an
appropriate handling permit from the Port Authority covering the Lessee's
handling of such Aircraft Operator to be subject to the prior and continuing
approval of the Port Authority and payment of all applicable fees to the Port
Authority, and if the Port Authority deems appropriate, the execution among the
Port Authority, the Lessee, and such Aircraft Operator of a form of consent
agreement prepared by the Port Authority. Nothing contained herein shall in any
way affect the discretion of the Port Authority in granting or withholding a
permit or its consent to a Handling Agreement proposed by the Lessee and any
such permit and/or consent may contain such terms and conditions including but
not limited to such financial or other conditions which may include a fixed
charge or a charge based upon a percentage of the Lessee's gross receipts
arising therefrom, as the Port Authority
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may, at that time, elect. All such rates, fees and charges pursuant to any such
Handling Agreement shall be at reasonable and at non-discriminatory rates, fees
and charges.
(h) Rights of Users of Terminated Gate(s):
Effective from and after a Section 42 Gate Termination Date as to
each Section 42 Terminated Gate, the Port Authority and each user of a Section
42 Terminated Gate, and their respective officers, employees, passengers,
patrons, invitees, contractors, suppliers of material and furnishers of
services, shall have the right of ingress and egress between the Section 42
Terminated Gates and Gate Related Premises and the public streets outside the
Premises, and also the right of ingress and egress between the Premises and the
Public Landing Area at the Airport, by means of existing taxiways to be used in
common with others having rights of passage thereon, as well as over the taxiway
areas of the Premises.
(i) No Waiver:
The failure of the Port Authority to exercise any of its rights
under this Section 42 during any period in which it may have such a right shall
not affect, waive or limit its right to exercise said rights or any other of its
rights or remedies under this Agreement or otherwise at any subsequent time.
SECTION 43. ADDITIONAL RIGHTS OF TERMINATION OF THE PORT AUTHORITY AS TO
PORTIONS OF THE PREMISES
(a) It is hereby agreed that for the purpose of this Section the term
the "Lessee's Commencement Basic Schedule" shall be and mean the following:
(1) for the first full calendar year occurring from and after the
Completion Date (the "First Commencement Period"), the Lessee's Commencement
Basic Schedule shall mean the Revenue Seats Daily Average, as defined in
paragraph (f) hereof, for the immediately preceding calendar year; and
(2) for the second full calendar year occurring after the First
Commencement Period, the Lessee's Commencement Basic Schedule shall mean the
Revenue Seats Daily Average for the immediately preceding calendar year; and
(3) for the third full calendar year occurring after the First
Commencement Period, the Lessee's Commencement Basic Schedule shall mean the
Revenue Seats Daily Average for the immediately preceding calendar year; and
(4) for the fourth full calendar year occurring after the First
Commencement Period the Lessee's Commencement Basic Schedule shall mean the
Revenue Seats Daily Average for the immediately preceding calendar year; and
(5) for the fifth full calendar year occurring after the First
Commencement Period the Lessee's Commencement Basic Schedule shall mean the
Revenue Seats Daily Average for the immediately preceding calendar year; and
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(6) for the sixth full calendar year occurring after the First
Commencement Period and each and every calendar year thereafter the Lessee's
Commencement Basic Schedule shall mean the Revenue Seats Daily Average for the
fifth full calendar year occurring after the Completion Date.
(b) Commencing with the First Commencement Period, and for each and
every calendar year thereafter, the Port Authority may ascertain the Revenue
Seats Daily Average of the Lessee for the Airport for the preceding calendar
year in accordance with the provisions of paragraph (f) hereof, which Revenue
Seats Daily Average shall be the Lessee's Basic Schedule for the preceding
calendar year and shall be referred to as such. Thus, for example, if the first
calculation was based on the calendar year 2009 experience, said Revenue Seats
Daily Average shall be called the "Lessee's Basic Schedule for 2009".
(c) If as of the first January 1st occurring after the First
Commencement Period, and as of the January 1st of each succeeding calendar year
(i) the Lessee's Basic Schedule for the immediately preceding calendar year for
the Airport is less than sixty-seven percent (67%) of the Lessee's Commencement
Basic Schedule for such year or (ii) because of reasons beyond the control of
the Lessee the Lessee's Basic Schedule for the immediately preceding two
calendar years is less than sixty-seven percent (67%) of the Lessee's
Commencement Basic Schedule, then in either of such events set forth in the
foregoing clauses (i) and (ii) and in addition to and without limiting each and
every other right the Port Authority has under this Agreement or otherwise, the
Port Authority shall have additional rights exercisable at its sole option, upon
six (6) months written notice to the Lessee, (i) to require the Lessee (and the
Lessee hereby agrees) to make available Accommodations at the Premises as
directed by the Port Authority in the amount and to the extent set forth in
paragraph (g) hereof to Aircraft Operators (each a "Section 43 Notice to Provide
Accommodations"); or (ii) to terminate the letting under the Lease as to such
number of Gates and all Gate Related Premises applicable thereto (each a
"Section 43 Gate Termination Notice") set forth in paragraph (g) hereof; or
(iii) to serve both a Section 43 Notice to Provide Accommodations and a Section
43 Gate Termination Notice as to any combination of the Gates (and all Gate
Related Premises applicable thereto) ) set forth in paragraph (g) hereof.
(d) Accommodations:
(1) The Lessee's obligation under this Section 43 to provide
Accommodations to Scheduled Aircraft Operators shall be effective on the date
set forth in each Section 43 Notice to Provide Accommodations from the Port
Authority to such effect, as aforesaid. Upon such Section 43 Notice to Provide
Accommodations the Lessee shall use its best efforts to secure an arrangement
with a Scheduled Aircraft Operator as directed by the Port Authority for
Accommodations in the Premises and shall in good faith negotiate with any such
Scheduled Aircraft Operator as the Port Authority shall direct for
Accommodations in the Premises, all in accordance herewith. With respect to each
Section 43 Notice to Provide Accommodations served on the Lessee by the Port
Authority, the Lessee shall make such Accommodations, as specified in the
Section 43 Notice to Provide Accommodations, available from time to time during
the entire period commencing on the effective date set forth in the
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aforesaid Section 43 Notice to Provide Accommodations and ending when the
Lessee's Basic Schedule for a calendar year, determined in accordance with the
foregoing shall have been sixty-seven percent (67%) or more of the Lessee's
Commencement Basic Schedule (a "Period of Underutilization").
(2) (i) Such Accommodations may be accomplished by the Lessee by
making available and providing non-exclusive use of Gates and Gate Related
Premises to Scheduled Aircraft Operators pursuant to a Handling Agreement
between the Lessee and any such Scheduled Aircraft Operator. Each such Handling
Agreement shall be subject to the prior and continuing approval of the Port
Authority and the execution among the Port Authority, the Lessee, and the
Accommodated Handled Airline of a form of consent agreement prepared by the Port
Authority.
(ii) It is understood furthermore that the Accommodations
contemplated hereunder may involve the use of subleases of portions of the
Premises in addition to or in lieu of Handling Agreements. Any sublease with a
Scheduled Aircraft Operator, will similarly be subject to the prior and
continuing approval of the Port Authority and the execution of a consent
agreement prepared by the Port Authority, and executed by the Port Authority,
the Lessee and the Accommodated Sublessee Airline.
(3) Nothing contained herein shall in any way affect the
discretion of the Port Authority in granting or withholding its consent to a
Handling Agreement or a sublease with a Accommodated Sublessee Airline, proposed
by the Lessee or directed by the Port Authority whether or not during a Period
of Underutilization, and such consent may contain such terms and conditions
including but not limited to such financial or other conditions which may
include a fixed charge or a charge based upon a percentage of the Lessee's gross
receipts arising therefrom, as the Port Authority may, at that time, elect, and
all provisions of the Lease requiring the prior written consent or approval of
the Port Authority.
(4) Notwithstanding anything to the contrary contained herein the
Lessee understands and agrees that the Lessee shall not perform any services and
functions pursuant to any Handling Agreement or sublease with a Accommodated
Handled Airline or a Accommodated Sublessee Airline with respect to which the
Port Authority has specifically withheld consent and approval in the consent
agreement to such Handling Agreement or sublease. The Accommodated Handled
Airline and the Accommodated Sublessee Airline may either perform said services
and functions themselves or use the services of the authorized service
organization, including but not limited to in-flight caterers, aircraft fuelers,
and ramp handlers performing such services or functions at the Airport. The
Lessee however may make the necessary arrangements with the authorized service
organization performing such services and functions performed for the
Accommodated Handled Airline or the Accommodated Sublessee Airline.
(5) The Lessee shall furnish to the Port Authority from time to
time such itemization, details and information pertaining to the Handling
Agreements and subleases as the Port Authority may from time to time request.
Moreover, and without limiting the foregoing, the Lessee shall at all times keep
the Port Authority informed and advised and will
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consult with the Port Authority from time to time as to all aspects of its
Accommodations of Scheduled Aircraft Operators hereunder.
(6) The Lessee agrees that all services, facilities, equipment
and other items covered by Handling Agreements and subleases shall be at
reasonable and at non-discriminatory rates, fees and charges, which rates, fees
and charges shall be based upon the recovery by the Lessee of a pro rata share
of the Lessee's costs of (i) operation and maintenance of the Premises, (ii) the
services provided to the Accommodated Handled Airline or the Accommodated
Sublessee Airline and (iii) the Lessee's investment in the Premises not
otherwise included in the above, and (iv) fees and rents paid to the Port
Authority under this Agreement. Further, each Accommodations Agreement shall
include (unless not required by the Lessee) that the Requesting Airline
indemnify and hold the Lessee harmless from any injury, loss and/or damages
associated with the Requesting Airline's use or occupancy of the applicable
portions of the Premises; that the Requesting Airline provide the Lessee with a
certificate of insurance evidencing that the Requesting Airline maintains
insurance in accordance with the requirements set forth in the Port Authority's
consent to the Accommodations Agreement and that the Lessee is named as an
additional insured on such insurance; that the Requesting Airline deposit with
the Lessee a security deposit with the Lessee in an amount equivalent to all
charges, fees, rentals, and other amounts payable by the Requesting Airline to
the Lessee pursuant to the Accommodations Agreement for a period of not greater
than two months; and that the Requesting Airline agrees to be bound by the terms
and conditions of the Lease applicable to the Requesting Airline.
(7) It is understood and agreed that the following shall not be a
reason for the Lessee to refuse a sublease or Handling Agreement or to impose
any conditions or limitations on operations in connection therewith under this
Section: (aa) possible or potential labor disharmony with an Accommodated
Handled Airline or Accommodated Sublessee Airline, (bb) compatibility of
schedules and operations between the Lessee or another user or occupant of the
Premises and an Accommodated Handled Airline or Accommodated Sublessee Airline,
or (cc) competitive nature of the routes, schedules or type of air
transportation service to be provided by an Accommodated Handled Airline or
Accommodated Sublessee Airline, provided, further, however, that with respect to
item (aa) above if, after notice from the Port Authority to provide
Accommodations to a specific Scheduled Aircraft Operator, the Lessee shall, in
good faith, believe that the operations of such specific Scheduled Aircraft
Operator on the Premises would cause such significant, immediate and
irremediable labor disharmony which would seriously affect the operations of the
Lessee then, upon request by the Lessee to the Port Authority setting forth in
specific detail satisfactory to the Port Authority the nature of the anticipated
labor disharmony and requesting that the Lessee not be obligated under this
Section to provide Accommodations for such specific Scheduled Aircraft Operator,
the Port Authority shall, in good faith, consider the Lessee's request and if
the Port Authority finds that the labor disharmony described by the Lessee is
reasonably likely to result if the Lessee were to provide Accommodations to such
Scheduled Aircraft Operator on the Premises then the Port Authority shall notify
the Lessee that the Port Authority's discretion to provide Accommodations to
such Scheduled Aircraft Operator is rescinded.
(e) Section 43 Gate Termination:
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(1) In the event the Port Authority serves a Section 43 Gate
Termination Notice in accordance with the foregoing paragraph (c), the
termination of the Gate or Gates and the Gate Related Premises specified in such
Notice shall be effective on the date set forth in said Section 43 Gate
Termination Notice (each a "Section 43 Gate Termination Date").
(2) As to each Section 43 Gate Termination Notice, upon such
termination, the term of the letting as to the terminated portion or portions of
the Premises (i.e. Gate(s) and Gate Related Premises) shall cease and expire on
the effective date set forth in said Section 43 Gate Termination Notice with the
same force and effect as if said date were the date originally stated in this
Agreement for the expiration of the term of the letting as to said portion or
portions of the Premises. This Agreement and the letting as to all other
portions of the Premises (excluding all other previously terminated portions
thereof) shall continue in full force and effect.
(3) In the event of the termination of any portion or portions of
the Premises (i.e. Gate(s) and Gate Related Premises) pursuant to a Section 43
Gate Termination Notice the rentals payable under this Lease shall not be abated
but instead the following rentals, and only such rentals, shall be adjusted as
follows, which adjustment shall be subject to and conditioned on the Lessee's
continued compliance with the terms and conditions set forth in paragraphs (h)
and (i) below, and shall be made only during such times that the Lessee shall be
in compliance with paragraphs (h) and (i) below and shall provide full and
unrestricted access, ingress and egress to the Section 43 Terminated Gate(s) to
the Port Authority and each user of the Section 43 Terminated Gate(s) and their
employees, agents, representative and contractors:
(i) For each Section 43 Terminated Gate, from and after the
later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Second Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Second Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 42 hereof, by
the Pro-Rata Share.
(ii) For each Section 43 Terminated Gate, from and after the
later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Third Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Third Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 42 hereof, by
the Pro-Rata Share.
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(iii) For each Section 43 Terminated Gate, from and after
the later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Fourth Ground
Rental payable by the Lessee to the Port Authority hereunder shall be reduced by
an amount equal to the product obtained by multiplying the amount of such
installment of Fourth Ground Rental that would have been payable by the Lessee
under this Lease (including without limitation taking into account any abatement
thereof) if there had not been any termination at any time of any Gates and Gate
Related Premises pursuant to this Section or pursuant to Section 42 hereof, by
the Pro-Rata Share.
(iv) With respect to each Section 43 Gate Termination
Notice, for the purpose of calculating the Second Enplanement Rental payable by
the Lessee to the Port Authority hereunder from and after the later to occur of
the Section 43 Gate Termination Date applicable to such Section 43 Terminated
Gate and the date that the Lessee shall have actually surrendered and vacated
such Section 43 Terminated Gate in accordance with all the applicable provisions
of this Lease, (x) the amount of the Base Enplanement Rental, as the same may
have been previously reduced pursuant to the provisions of this Section 43 or
Section 42 hereof, shall be reduced by subtracting therefrom an amount equal to
the product obtained by multiplying the number of Gates terminated by such
Section 43 Gate Termination Notice by the product obtained by multiplying the
Initial Base Enplanement Rental by the Pro-Rata Share, and (y) the amount of the
Minimum Enplanement Rental, as the same may have been previously reduced
pursuant to the provisions of this Section 43 and Section 42, shall be reduced
by subtracting therefrom, an amount equal to the product obtained by multiplying
the number of Gates terminated by such Section 43 Gate Termination Notice by the
product obtained by multiplying the Initial Minimum Enplanement Rental by the
Pro-Rata Share, and (z) the Variable Enplanement Rental, as the same may have
been previously reduced pursuant to the provisions of this Section and Section
42 hereof, shall be reduced by subtracting therefrom an amount equal to the
product obtained by multiplying the number of Gates terminated by such Section
43 Gate Termination Notice by the product obtained by multiplying such Variable
Enplanement Rental, by the Pro-Rata Share.
(v) For each Section 43 Terminated Gate, from and after the
later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the First
Additional Rental payable by the Lessee to the Port Authority hereunder shall be
reduced by an amount equal to the product obtained by multiplying the amount of
such installment of First Additional Rental that would have been payable by the
Lessee under this Lease if there had not been any termination at any time of any
Gates and Gate Related Premises pursuant to this Section or pursuant to Section
42 hereof, by the Pro-Rata Share.
(vi) For each Section 43 Terminated Gate, from and after the
later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment
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of the Third Additional Rental payable by the Lessee to the Port Authority
hereunder shall be reduced by an amount equal to the product obtained by
multiplying the amount of such installment of Third Additional Rental that would
have been payable by the Lessee under this Lease if there had not been any
termination of any Gates and Gate Related Premises pursuant to this Section or
pursuant to Section 42 hereof, by the Pro-Rata Share.
(vii) For each Section 43 Terminated Gate, from and after
the later to occur of the Section 43 Gate Termination Date applicable to such
Section 43 Terminated Gate and the date that the Lessee shall have actually
surrendered and vacated such Section 43 Terminated Gate in accordance with all
the applicable provisions of this Lease, each installment of the Fifth
Additional Rental payable by the Lessee to the Port Authority hereunder shall be
reduced by an amount equal to the product obtained by multiplying the amount of
such installment of FifthAdditional Rental that would have been payable by the
Lessee under this Lease if there had not been any termination of any Gates and
Gate Related Premises pursuant to this Section or pursuant to Section 42 hereof,
by the Pro-Rata Share.
(4) Within sixty (60) days after the later to occur of a Section
43 Gate Termination Date and the date that the Lessee shall have actually
surrendered and vacated in accordance with all applicable provisions of this
Lease all of the Section 43 Terminated Gate(s) for which such Section 43 Gate
Termination Date is applicable, the Port Authority shall, with respect to each
such Section 43 Terminated Gate, make a one-time payment to the Lessee in the
amount equal to the product obtained by multiplying the Pro-Rata Share by the
Lessee's Unamortized Investment. The foregoing payments shall be subject to the
Port Authority's rights of audit and inspection and shall be subject to the
record-keeping obligations of the Lessee under Section 65 hereof.
(5) The Port Authority's rights to terminate one or more Gates
and Gate Related Premises set forth above may be exercised one or more times
until the total applicable Gates and Gate Related Premises have been terminated,
without waiving, limiting or impairing any other rights or remedies of the Port
Authority under this Agreement or otherwise.
(f) (1) In the event the Port Authority decides to ascertain the
Revenue Seats Daily Average of the Lessee for the preceding calendar year it
shall do so as follows: based upon the Official Airlines Guide (herein called
the "Guide"), or in the event that the Guide shall not list the Lessee's
schedules, then based upon the generally accepted United States aviation
industry standard published airline schedule reference which shall include the
Lessee's published schedules, the Port Authority shall ascertain the total
number of revenue seats that were accommodated on the aircraft equipment
scheduled to have been used by the Lessee on its published aircraft arrivals at
the Airport as set forth in the Guide during two specified calendar weeks
(Sunday through Saturday), the first of which weeks is the one during which the
fifteenth (15th) day of February of the prior calendar year fell and the second
being the one during which the fifteenth (15th) day of August of the said prior
calendar year fell (said week of February together with said week of August
being hereinafter collectively called the "Measuring Period"), and shall total
the said number of revenue seats which are hereinafter called the "Total Revenue
Seats" of the Lessee. In determining the Total Revenue Seats of the Lessee, the
Total Revenue Seats as defined above of those Accommodated Handled Airlines, if
any, of the Lessee who were
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Accommodated Handled Airlines as of the date of such determination and
Accommodated Sublessee Airlines at the Premises who were Accommodated Sublessee
Airlines on the date of such determination, with respect to the aircraft of the
Accommodated Handled Airlines and aircraft of the Accommodated Sublessee
Airlines operating at the Premises, shall be included.
(2) In making said determination, the Port Authority shall use
the aircraft configurations as supplied by the Lessee for the Measuring Period
in question with respect to the number of revenue seats that can be accommodated
on the particular aircraft equipment scheduled to be used by the Lessee at the
Airport. The Total Revenue Seats of the Lessee shall then be divided by
fourteen, the resulting quotient being herein called the "Revenue Seats Daily
Average" of the Lessee.
(g)
(1) Column A Column B
-------- --------
Percentage of the Lessee's Number of Gate Positions the Port
Basic Schedule Compared to Authority May Require
▇▇▇▇▇▇'s Commencement Accommodations at the Premises
Basic Schedule and/or May Terminate from the Premises
66% 9
59% 11
51% 13
43% 15
35% 17
27% 19
19% 21
10% 23
0% 26
(2) The following shall apply when at any time the total number
of Gates in the Premises is other than 26.
If the number of Gates in the Premises shall decrease as a result
of the Port Authority having exercised its rights of termination under the Lease
as to a portion or portions of the Premises as set forth above in this Section
or in Section 42 hereof (the date of each such decrease in the number of Gates
in the Premises being hereinafter called a "Change Date") then: commencing with
the immediately succeeding Measuring Period following such Change Date the
number of Gates which the Port Authority may require Accommodations or may
terminate set forth in each Column B above for each percentage set forth in each
Column A above shall be adjusted to equal the difference obtained by subtracting
from the total number of Gates in the Premises on the Change Date, the product
obtained by multiplying said percentage by the number of Gates in the Premises
on the Change Date, in accordance with the following formula:
G - (P X G) = U
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Where, G equals the total number of Gates in the Premises on the Change Date
P equals the applicable percentage under Column A
U equals the number of Gates that the Port Authority may require Accommodations
or may terminate from the Premises
(h) Services to Section 43 Terminated Gate(s):
The Lessee shall cooperate with the Port Authority in
arrangements at the Premises so that each Aircraft Operator who uses a Section
43 Terminated Gate may handle itself or be handled by a handling permittee of
the Port Authority of its choice, subject to prior written consent of the Port
Authority and payment of all applicable fees to the Port Authority. In the event
that the Lessee wishes to perform handling services for any such Aircraft
Operator, the Lessee shall not do so unless the Lessee has obtained an
appropriate handling permit from the Port Authority covering the Lessee's
handling of such Aircraft Operator to be subject to the prior and continuing
approval of the Port Authority and payment of all applicable fees to the Port
Authority, or if the Port Authority deems appropriate, the execution among the
Port Authority, the Lessee, and such Aircraft Operator of a form of consent
agreement prepared by the Port Authority. Nothing contained herein shall in any
way affect the discretion of the Port Authority in granting or withholding a
permit or its consent to a Handling Agreement proposed by the Lessee and such
permit and/or consent may contain such terms and conditions including but not
limited to such financial or other conditions which may include a fixed charge
or a charge based upon a percentage of the Lessee's gross receipts arising
therefrom, as the Port Authority may, at that time, elect. All such rates, fees
and charges pursuant to any such Handling Agreement shall be at reasonable and
at non-discriminatory rates, fees and charges.
(i) Rights of users of Section 43 Terminated Gate(s)
Effective from and after a Section 43 Gate Termination Date as to
each Section 43 Terminated Gate and applicable Gate Related Premises, the Port
Authority and each user of a Section 43 Terminated Gate and Gate Related
Premises, and their respective officers, employees, passengers, patrons,
invitees, contractors, suppliers of material and furnishers of services, shall
have the right of ingress and egress between the Section 43 Terminated Gate and
applicable Gate Related Premises and the public streets outside the Premises,
and also the right of ingress and egress between the Premises and the Public
Landing Area at the Airport, by means of existing taxiways to be used in common
with others having rights of passage thereon, as well as over the taxiway areas
of the Premises.
(j) The failure of the Port Authority to exercise any of its rights
under this Section during any period in which it may have such a right, shall
not affect, waive or limit its right to exercise said rights at any subsequent
time or any other of its rights and remedies under this Agreement or otherwise.
(k) Nothing in this Section shall be deemed to have abrogated, changed
or affected any restrictions, limitations or prohibitions on assignment,
subletting or use of the
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Premises by others under this Lease nor shall in any manner affect, waive or
change any of the provisions thereof.
SECTION 44. FORCE MAJEURE
Neither the Port Authority nor the Lessee shall be deemed to be in
violation of this Agreement if it is prevented from performing any of its
obligations hereunder by reason of strikes, boycotts, labor disputes, embargoes,
shortages of material, acts of God, acts of the public enemy, acts of superior
governmental authority, weather conditions, tides, riots, rebellion, sabotage or
any other circumstances for which it is not responsible and which are not within
its control; provided, however, that this provision shall not apply to failures
by the Lessee to pay the rentals specified in Section 4 hereof entitled "Rental"
and shall not apply to any other charges or money payments under this Agreement;
and, provided, further, that this provision shall not prevent either party from
exercising its respective right of termination under Section 20 hereof entitled
"Termination by the Port Authority", Section 83 hereof entitled "Termination by
the Lessee", Section 49 entitled "Lessee's Financial Condition-Limitation of
Lease Term-Triggering Events and Section 50 entitled "Right of
Termination-Securities Ownership" and shall not prevent the Lessee from
exercising its right to an abatement of rental under Section 37 hereof entitled
"Abatement".
SECTION 45. INGRESS AND EGRESS
(a) The Lessee, its officers, employees, passengers, patrons,
invitees, contractors, suppliers of material and furnishers of services, shall
have the right of ingress and egress between the Premises and the city streets
outside the Airport over such highways at the Airport as may be made available
from time to time by the Port Authority for use by the public, provided,
however, that the Lessee hereby expressly understands and agrees that the Lessee
shall have no right of ingress and egress or access hereunder or otherwise for
its employees, customers, patrons, invitees and their baggage between the
Premises and the city streets or public ways outside the Airport by means of any
mode of transportation or any vehicle which may be limited or restricted in
accordance with Section 46 hereof, it being understood that access to the
Premises for emergency response for reasons of safety or health shall not be
deemed a breach hereof. Such right shall be exercised in common with others
having rights of passage within the Airport.
(b) The Lessee shall have the right of ingress and egress between the
Premises and the Public Landing Area at the Airport, by means of existing
taxiways to be used in common with others having rights of passage thereon,
provided, however, that the Port Authority may from time to time substitute
other reasonably equivalent means of ingress and egress.
(c) The use of all roadways and taxiways shall be subject to the Rules
and Regulations of the Port Authority which are now in effect or which may
hereafter be promulgated for the safe and efficient operation of the Airport. In
addition to the rights of closure granted above, the Port Authority may, at any
time, temporarily or permanently close, or consent to or request the closing of,
any such roadway, taxiway and any other area at the Airport presently or
hereafter used as such, so long as a reasonably equivalent means of ingress and
egress remains available to the Lessee. The Lessee hereby releases and
discharges the Port
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Authority, and all municipalities and other governmental authorities, and their
respective successors and assigns of and from any and all claims, demands or
causes of action which the Lessee may now or at any time hereafter have against
any of the foregoing, arising or alleged to arise out of the closing of any way
or other area, whether within or outside the Airport provided a reasonably
equivalent means of access is available. The Lessee shall not do or permit
anything to be done which will interfere with the free access and passage of
others to space adjacent to the Premises or in any streets, ways and walks near
the Premises.
SECTION 46. RESTRICTIONS ON USE OF PASSENGER TERMINAL FRONTAGE ROADWAYS-USE OF
AIRPORT TAXI DISPATCHERS AND ROADWAYS FRONTAGE
(a) The Lessee understands that the Port Authority presently has in
effect and has planned various physical improvements and policies concerning and
affecting the use of vehicular roadways in the Central Terminal Area ("CTA") of
the Airport for the limitation and control of traffic thereon including the
limitation and control of vehicular traffic on the Premises and vehicular
traffic moving between the Air Terminal Highways, as designated from time to
time by the Port Authority in the CTA of the Airport, and the vehicular roadways
on the Premises connecting to the said Air Terminal Highways. These improvements
and policies, both in existence and planned, generally include the following:
(1) Restrictions on the use of roadways in the CTA as set forth
in Section 68 hereof entitled "Ground Transportation Within the Central Terminal
Area" and Section 67 hereof entitled "Ground Transportation."
(2) The use of airport taxi dispatching services (as generally
set forth in paragraph (b) hereof) where the Port Authority, either itself or
through its contractor, utilizes at passenger terminals under the control of the
Port Authority and makes available to passenger terminals at the Airport
operated by others, the services of taxi dispatchers to assist in the
expeditious and orderly flow of taxicabs to and from passenger terminals at the
Airport.
(3) The use of a central taxi holding and dispatching system for
the Airport in conjunction with the use of taxi dispatchers at the passenger
terminals at the Airport.
(4) The designation of specified portions of the vehicular
roadways on the Premises for limited use exclusively by certain types of ground
transportation vehicles and/or certain types of ground transportation carriers
for the loading and unloading of passengers and their baggage.
(5) The planning and construction of improvements to increase the
capacity of roadway frontages at the passenger terminals.
(b) The Lessee agrees to restrict from the Premises during the time
period or time periods, as may be specified by the Port Authority from time to
time (each such period being herein referred to as a "Taxi Dispatcher Period"),
all taxicabs except those taxicabs which are discharging passengers at the
Premises and those taxicabs which are requested by a taxi dispatcher stationed
on the Premises and dispatched through the airport central taxi holding and
dispatching facility (herein called the "Airport Central Taxi Stack") to the
Premises. Further,
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during any Taxi Dispatcher Period the Lessee agrees to take and accept from the
Port Authority, and permit the stationing at an appropriate location or
locations on the Premises, of a taxi dispatcher or taxi dispatchers and the
establishment of a taxicab waiting line on the Premises of such number of
vehicles as shall be specified by the Port Authority from time to time. A taxi
dispatcher or taxi dispatchers when located on the Premises shall provide the
sole and exclusive dispatch of taxicabs to the Lessee's passengers and others
desiring the use of a taxicab from the Premises and shall perform such other
duties and functions in connection therewith as may be specified by the Port
Authority from time to time. The Lessee agrees to permit the Port Authority to
install on the Premises such fixtures, equipment and improvements including, but
not limited to, taxi dispatcher shelters, telephones, radio transceiver and
transponder receiving devices as may be necessary or reasonably desired by the
Port Authority in connection with the activities and operations of the taxi
dispatchers. The Lessee understands and agrees that all expenses of the Port
Authority associated with the implementation and operation of the taxi
dispatchers on the Airport including, but not limited to, the taxi dispatchers
on the Premises and the construction, maintenance and operation of the Airport
Central Taxi Stack shall be included in and payable through the aircraft flight
fees at the Airport and will be accorded the same cost recovery treatment as the
Air Terminal Highway is accorded for such purposes under the JFK Flight Fees
Agreements and the calculation of other fees and charges under other existing
agreements and policies at the Airport, and under any agreements which may be
entered into and any policies which may be implemented, in the future, including
agreements and policies to replace such existing agreements and policies or the
JFK Flight Fees Agreements.
(c) In connection with and furtherance of the Port Authority's
policies concerning ground transportation on the Airport, the operation of the
Consolidated Counters as set forth in Section 66 entitled "Ground Transportation
Services", the operation of taxi dispatchers and the Airport Central Taxi Stack
as set forth in this Section, and the provisions governing ground transportation
within the Central Terminal Area as set forth in Section 68 hereof entitled
"Ground Transportation within the Central Terminal Area", the Lessee hereby
agrees that, from time to time, the Port Authority may designate and specify
appropriate areas of roadways and curbs located on the Premises, for the purpose
of segregated and exclusive use by separate categories of vehicles, including
but not limited to buses, taxicabs, private automobiles and other vehicles, and
use by separate categories of ground transportation carriers (including but not
limited to Port Authority permittees) as may be designated by the Port
Authority, from time to time, for the purpose of loading and unloading
passengers and their baggage. The Lessee shall prohibit the operation of all
other types of vehicular traffic on the roadways on the Premises used for the
loading and unloading of passengers and their baggage and shall prohibit parking
or stopping except in the areas designated as aforesaid. Designated areas shall
be clearly indicated by the Lessee by appropriate signing and marking on the
Premises as shall be directed or approved from time to time by the Port
Authority. The Lessee shall permit the Port Authority to install on the Premises
such fixtures, equipment and improvements, including, but not limited to
transponder receiving devices and other vehicular tracking and monitoring
devices; and the Lessee shall, through the use of appropriate and sufficient
means including, but not limited to, removing unauthorized parked vehicles from
the Premises, security guards and other personnel stationed on the Premises in
the area of the said roadways, require that the limitations and restrictions
established hereunder by the Port Authority on the use of the said roadways are
complied with and enforced during any Taxi Dispatcher Period and at other times
as may be
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directed by the Port Authority (which compliance and enforcement may
be directed on a 24-hour basis).
(d) The Lessee understands that the proper limitation and control of
traffic on passenger terminal frontage roads has an impact on the proper and
efficient operation of the Air Terminal Highway system of the Airport and the
Lessee agrees, for so long as the same is made available by the Port Authority,
to either accept from the Port Authority or from the Port Authority contractor
providing the service of limiting and controlling traffic on passenger terminal
frontage roads from time to time and to pay for the frontage management services
at the rate and in a manner which shall be applicable uniformly throughout the
Airport or to provide substantially similar services itself.
(e) The Lessee understands that the Port Authority considers the
provisions of this Section and the use of the Lessee's passenger terminal
roadway areas of the utmost importance to the efficient operation of the Air
Terminal Highway on the Airport and to the fulfillment of the Port Authority's
governmental function to provide, maintain, develop, and operate the Airport;
that the efficient use and operation of the Air Terminal Highway requires that
the Lessee, in the operation and use of its passenger terminal facilities under
this Lease shall utilize and cooperate fully in all respects in the operation
and implementation of the provisions of this Section to the end that the Air
Terminal Highway, including ingress thereto and egress therefrom, will operate
in the most efficient manner; and that the Port Authority does not by this Lease
intend to enter into any agreement, understanding, or commitment which will
interfere with, limit, restrict, hinder, or prevent in any way, the efficient
development, implementation and operation of the Air Terminal Highway and the
rights and discretion of the Port Authority with respect thereto.
(f) The Port Authority has advised the Lessee that it is the intention
of the Port Authority that all Aircraft Operators which are similarly situated
will be treated in a similar manner with respect to the payment, operation and
use of the taxi dispatchers and the Airport Central Taxi Stack as generally set
forth in paragraph (b) above and with respect to the separation, designation and
use of specific areas of roadways and curbs in the Premises for exclusive use by
separate categories of vehicles and ground transportation carriers as generally
set forth in paragraph (c) above.
SECTION 47. MAINTENANCE EMPLOYEES
The Lessee shall at all times during the term of this Agreement on a
twenty-four hour, seven-day a week basis maintain sufficient qualified personnel
at the Airport including but not limited to licensed electricians and plumbers,
who shall be qualified to perform the maintenance obligations of the Lessee
under this Agreement and particularly be able to respond to all emergencies,
provided, however, the Lessee shall not be required to maintain licensed
electricians or plumbers at the Airport twenty-four hours, seven-days a week if
the Lessee shall have submitted a plan to the General Manager of the Airport for
his or her approval setting forth the plans and procedures pursuant to which the
Lessee would respond to all emergencies at the Premises twenty-four hours,
seven-days a week and such plan shall have been approved by the General Manager
of the Airport.
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SECTION 48. QUIET ENJOYMENT
The Port Authority covenants and agrees that as long as the Port
Authority remains the lessee of the Airport the Lessee, upon paying all rentals
hereunder and performing all the covenants, conditions and provisions of this
Agreement on its part to be performed, shall and may peacefully and quietly have
and enjoy the Premises free of any act or acts of the Port Authority except as
expressly agreed upon in this Agreement.
SECTION 49. LESSEE'S FINANCIAL CONDITION - LIMITATION OF TERM LEASE -TRIGGERING
EVENTS
(a) If any one or more of the Triggering Events listed in the exhibit
annexed hereto, hereby made a part hereof and marked "Exhibit 49.1" (hereinafter
called "Exhibit 49.1"), shall occur, then:
(1) with respect to the Triggering Event listed in paragraph (1)
of Subdivision II of Exhibit 49.1, seven (7) days following the occurrence of
such Triggering Event; or
(2) with respect to the Triggering Event listed in paragraph (3)
of Subdivision II of Exhibit 49.1, ten (10) business days following the
occurrence of any such Triggering Event the term of this Agreement and the
letting hereunder shall be deemed terminated, and the Lessee shall thereafter be
a hold-over tenant, on a month-to-month periodical basis, of the Port Authority.
Termination hereunder shall be and operate as a conditional limitation. In the
event any court of competent jurisdiction shall not give full and complete
effect to this termination provision and its operation as a conditional
limitation, the Lessee and the Port Authority agree, as a condition of this
Agreement, and not merely as a covenant, that this Agreement and the stated term
of the letting hereunder shall nonetheless, from and after the effective date of
termination provided above, be deemed to have expired.
(b) Without limiting this Section or any term or provision hereof, and
without limiting any term or provision of Exhibit 49.1, the Lessee agrees that:
(1) It shall meet with representatives of the Port Authority as
described below and provide to said representatives the information described
below during such scheduled meetings and at any other time as requested by the
Port Authority; and
(2) If requested by the Port Authority, the Lessee shall deliver
to the Port Authority, (a) as soon as available, but not later than forty-five
(45) days after the close of each fiscal quarter, the consolidated
profit-and-loss statement of the Lessee or of the Lessee's parent company which
shall fairly and substantially reflect the Lessee's financial and operating
condition for such fiscal quarter, to be accompanied by a schedule setting forth
for each fiscal quarter the Lessee's enplanement load factor, available seat
miles ("ASM"), revenue passenger miles ("RPM"), cost per ASM and yield per RPM,
each certified by a responsible officer of the Lessee as accurate and complete,
(b) within five (5) days after filing with the Department of Transportation, a
copy of each Form 41 and (c) within five (5) days after the same becomes
available, but not later than ninety (90) days after the close of each of its
fiscal years, a complete copy of the Lessee's Annual Report or equivalent which
shall fairly and substantially reflect the
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Lessee's financial and operating condition for such fiscal year, which shall
include consolidated financial statements of the Lessee which shall include the
consolidated balance sheet of the Lessee as of the close of such year, and the
consolidated statement of operations and statement of changes in financial
position of the Lessee for such year, certified by an independent certified
public accountant.
(c) There shall be an annual meeting with representatives of the Port
Authority and with the chief operating officer or principal financial officer of
the Lessee on the last business day of the month of April, or on such other day
as may, from time to time, be agreed upon by the Lessee and the Port Authority
to review the financial and operating performance of the Lessee. The foregoing
provisions with respect to the said meetings on the last business day of the
month of April shall be subject to the Lessee's right to reschedule by sending
to the Port Authority a written notice prior to the first day of said month
setting forth four (4) alternative business days within said month of April. The
Port Authority shall notify the Lessee of its selection of the day for the next
annual meeting within ten (10) days of its receipt of the said notice of the
Lessee, if any. The review shall include but not be limited to the furnishing of
the following information regarding the Lessee to the Port Authority by the
Lessee and the discussion of same:
(1) Financial data including without limitation Form 41 filings
with the Department of Transportation and any other statement which will reflect
the financial and operating condition of the Lessee.
(2) Monthly traffic data including passengers, aircraft
departures, available seat miles and revenue passenger miles.
(3) Monthly load factors and any performance indicator filed with
the United States Department of Transportation including, without limitation,
on-time performance and customer complaints received.
(d) It is the position of the Lessee that all or portions of the
information it has agreed to furnish the Port Authority hereunder is of a
confidential nature. The Port Authority agrees that, unless required to do so
pursuant to any legal obligations imposed upon the Port Authority requiring
public disclosure of information, or pursuant to freedom of information policy
adopted or which may be adopted by its Commissioners, it shall not deliberately
convey the same to any private Person.
(e) The Lessee shall submit to the Port Authority a statement at any
time during the term of the letting signed by the Treasurer of the Lessee
notifying the Port Authority that a Triggering Event or Triggering Events listed
in Exhibit 49.1 has or have occurred and the date of the occurrence thereof,
provided, however, that failure to give any such notice shall not affect the
occurrence of any Triggering Event or the consequences thereof hereunder.
(f) If the Lessee has, by notice, advised the Port Authority that it
reasonably believes that any of the Triggering Events which are listed in
Exhibit 49.1 hereof and constitute events which would result in termination
pursuant to this Section either are anticipated to occur
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within forty-five (45) days of said notice, or has or have already occurred, or
if in fact any Triggering Event or Triggering Events has or have occurred, or
the Port Authority believes that the same has or have occurred without receipt
of any notice from the Lessee, as aforesaid, then:
(1) the Lessee may, at any time prior to the termination of the
letting, by notice, request that the Port Authority waive the occurrence of one
or more of the Triggering Events, and the effect thereof hereunder, for a period
of time to be determined by the Port Authority and to be contained in a letter
agreement to be prepared by the Port Authority and executed by the Port
Authority, which shall be effective upon its execution by the Lessee; or
(2) the Port Authority may, at any time prior to the termination
of the letting, in its sole discretion and without a prior request from the
Lessee, waive the occurrence of one or more of the Triggering Events, and the
effect thereof hereunder, for a period of time to be determined by the Port
Authority and to be set forth in a notice from the Port Authority to the Lessee.
Service of a notice hereunder shall not in and of itself imply or be deemed to
imply that a Triggering Event has occurred.
(3) The Port Authority shall have no obligation to take either of
the above two actions in paragraphs (f) (1) and (f)(2) above.
(g) Although it is hereby specifically acknowledged and agreed that
the aforesaid month-to-month periodical tenancy described in paragraph (a) above
of this Section, if any should occur hereunder, is terminable by either party in
accordance with law and that the following provision shall have no effect
whatsoever on the right of either party to so terminate. It is further
understood that if four (4) consecutive calendar quarters have elapsed after a
Triggering Event has occurred during which time the Lessee is in occupancy of
the Premises as a month-to-month tenant, and during such period none of the
Triggering Events listed in Exhibit 49.1 have occurred or continue to occur, the
Lessee is not in default in the payment of rental or any other provision of its
month-to-month tenancy and neither the Port Authority nor the Lessee has
terminated the month-to-month tenancy by notice to the other, then upon request
by either party to the other, the parties will enter into a supplementary
agreement to be prepared by the Port Authority and to be promptly executed by
the parties hereto which would provide for the re-establishment of a tenancy
between the Port Authority and the Lessee on a fixed term basis in accordance
with all of the terms and provisions of this Lease, and upon said execution the
Lease, as the same may theretofore have been supplemented, amended or extended,
shall have the fixed term stated in the Lease.
SECTION 50. RIGHT OF TERMINATION - SECURITIES OWNERSHIP
(a) The following terms when used in this Agreement shall have the
respective meanings given below:
(1) "Change in Control" shall mean the happening of any of the
following:
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(i) When any individual, corporation, partnership or other
entity shall have Direct or Indirect Beneficial Ownership of a portion of 33.3%
or more of any class of outstanding Voting Securities of the Lessee;
(ii) There shall be an issuance, transfer, purchase or
exchange of all or a portion of the securities of the Lessee or of a subsidiary
corporation of the Lessee or the creation, transfer, purchase or exchange of any
rights or privileges thereunder, or the transfer, purchase or exchange of all or
a portion of the assets of the Lessee or of a subsidiary corporation of the
Lessee, which causes or results in a change in the relationship between the
Lessee and a subsidiary corporation of the Lessee, or the Lessee and the holders
of the securities of the Lessee, or the creation of another corporation for the
purpose, among others, of accepting and holding securities of the Lessee, or
which places control of the Lessee in a single entity, or which effects, causes
or results in a transfer or change in the entity exercising control over the
Lessee, provided, however, that the provisions of this subdivision (ii) shall
not apply to any subsidiary corporation of the Lessee that is not a Scheduled
Aircraft Operator.
(iii) The occurrence of a transaction requiring stockholder
approval for the acquisition of the Lessee by an entity other than the Lessee or
through purchase of assets, or by merger, or otherwise.
(2) "Direct or Indirect Beneficial Ownership" shall include
without limiting the generality thereof the direct or indirect power through
contract, arrangement, understanding, relationship or to otherwise to dispose of
or to direct the disposal of, or to vote or to direct the voting of, any Voting
Security of the Lessee.
(3) "Voting Security" or "Voting Securities" shall include any
stock, bond or other obligation of the Lessee the holder of which has any voting
rights including but not limited to the right to vote for the election of
members of the board of directors of the Lessee and shall include any security
convertible into a Voting Security and any right, option or warrant to purchase
a Voting Security.
(4) "Change of Control Date" shall mean with respect to each
Change of Control, the date that such Change of Control shall have occurred.
(b) In addition to and without limiting Section 20 hereof entitled
"Termination by the Port Authority" or any other term or provision of this Lease
or of any of the rights and remedies of the Port Authority thereunder, the
occurrence of a Change in Control which either (i) results in a detectable
decrease in the amount of, and a change in the nature of, the Lessee's scheduled
passenger aircraft operations at the Airport or (ii) shall have the effect of
causing this Lease to become the only asset or a greater portion of the assets
of the Lessee than prior to such Change in Control, shall be and shall be deemed
an event of default under Section 20 hereof and upon the occurrence of any such
event or at any time thereafter during the continuance thereof the Port
Authority shall have the right to terminate the Lease and the letting hereunder
pursuant to the provisions of said Section 20.
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(c) The foregoing right of termination shall be in addition to all
other rights of termination the Port Authority has under this Agreement and the
failure of the Port Authority to exercise its right of termination under this
Section at any time in which it may have such right shall not affect, waive or
limit its right to exercise said right of revocations at any subsequent time.
(d) The Lessee represents and warrants to the Port Authority, knowing
that the Port Authority is relying on the accuracy of such representations and
warranties, that, as of the Lease Commencement Date, the Lessee is a corporation
organized and existing under the laws of the State of Delaware, and has issued
and has outstanding 110,826,000 Voting Securities which constitute all its
outstanding Voting Securities.
(e) The Lessee shall promptly advise the Port Authority in writing
addressed to the Port Authority's Director of Aviation of any change in the
representations and warranties made in paragraph (d) of this Section.
SECTION 51. ASSIGNMENT TO A TRUST
In the event that the Port Authority is of the opinion that it is
advisable due to statutory changes occurring after the Lease Commencement Date
in the laws of the United States of America regarding bankruptcy and insolvency,
which changes materially lessen or limit the rights or remedies of a landlord
should a tenant under a lease of non-residential real property become a debtor
pursuant to the aforesaid laws (such changes being hereinafter called "Changes
in Landlord Rights"), the Port Authority and the Lessee agree that this
Agreement, as the same may have been theretofore amended, supplemented or
extended and as then amended by a supplement to be prepared by the Port
Authority and executed by the Lessee and the Trust (described below) and
delivered to the Port Authority for its execution, shall be assigned to a Trust,
created as provided herein. The Trust shall be created by a trust indenture to
be prepared by the Port Authority and executed by the Port Authority and the
Lessee. The Trust would be under the voting control of the trustee designated by
the Lessee, unless and until stipulated events of the type set forth as
Triggering Events in Exhibit 49.1 occurred, in which event voting control would
shift to the trustee designated by the Port Authority. The occurrence of such
Triggering Events would be as certified by the independent trustee jointly
designated by the Port Authority and the Lessee. The Port Authority agrees that
it will simultaneously with the assignment of this Agreement, as the same may
have been theretofore amended, supplemented or extended, to the Trust, consent
to the Trust entering into a sublease with the Trust as landlord and the Lessee
as sublessee, provided, however, that such sublease shall be a month-to-month
periodical tenancy and the trust indenture shall provide for the same. If four
consecutive calendar quarters shall elapse after voting control of the Trust has
shifted to the trustee designated by the Port Authority and (i) the trustee
designated by the Port Authority shall not have, by notice, advised the Lessee
that it may no longer occupy the Premises as a month-to-month periodical tenant
pursuant to the aforesaid sublease and the Lessee in fact is so occupying and
(ii) none of the aforesaid stipulated events shall have occurred or continued to
occur or shall have again occurred, the Port Authority will, at the request of
the Lessee, prepare a supplemental agreement to be executed by the Trust and the
Lessee, and delivered to the Port Authority for its execution reassigning this
Agreement to the Lessee. If the Trust becomes the assignee of this Agreement as
provided above, and there are further Changes in Landlord Rights such that the
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rights and remedies of a landlord, as aforesaid, are restored, the Port
Authority shall prepare and tender to the Lessee and the Trust a supplemental
agreement to be executed and delivered by each of them and returned to the Port
Authority for its execution, reassigning this Agreement, as the same may have
been theretofore amended, supplemented or extended, to the Lessee.
SECTION 52. PURCHASE OF PROPERTY
The Port Authority shall have the option from time to time exercisable
by notice to the Lessee effective on the expiration or earlier termination of
the letting of the Premises hereunder, or any part thereof, to purchase all, or
such part as the Port Authority elects, of the Lessee's Personal Property
(including trade fixtures) including without limiting the generality of the
foregoing any system for handling baggage, any counters, and any passenger
loading bridges, as and to the extent any of the foregoing are personal
property, which may at the time of the giving of such notice have been installed
or placed on the Premises. In the event the Port Authority exercises its option
to make a purchase, the Port Authority shall pay to the Lessee a sum equal to
the reasonable value of such personal property (including trade fixtures)
purchased. The Lessee hereby agrees that it shall use reasonable commercial
efforts so that on the effective date of the purchase and sale none of the
aforesaid items shall be subject to any lien, security interest or other
encumbrance, and if after the Lessee having used such reasonable commercial
efforts any such property remains subject to any lien, security interest or
other encumbrance the reasonable value of such property shall be reduced to
properly reflect such lien, security interest or other encumbrance provided that
the indebtedness is assumed by the Port Authority with the consent of the
applicable lien holder. The Lessee hereby agrees that on the effective date of
the purchase and sale and upon request of the Port Authority the Lessee will
execute a bill of sale or such other document of conveyance as the Port
Authority may request to transfer title to the aforesaid items to the Port
Authority (including a warranty of title to the Port Authority) and the Port
Authority shall pay the purchase price. Further, the Lessee shall from time to
time execute such other documentation as the Port Authority may require and
prepare evidencing the option of the Port Authority, as herein provided, to
purchase the aforesaid personal property, including without limitation, security
agreements and filings pursuant to the Uniform Commercial Code.
SECTION 53. ASSUMPTION OF MAINTENANCE AND REPAIR OF THE PREMISES BY THE PORT
AUTHORITY
(a) The following terms when used in this Agreement shall have the
respective meanings given below:
(1) "Assumable Maintenance and Repair" shall mean the obligation
of the Lessee to clean, maintain, perform janitorial services and perform
structural and non-structural improvements, repairs and rebuilding at the
Premises as such obligations are set forth in:
(i) paragraphs (a) and (b) of Section 10 hereof entitled
"Care, Maintenance, Rebuilding and Repair by the Lessee"; and
(ii) Section 6 hereof entitled "Compliance with Governmental
Requirements" insofar as laws, ordinances and governmental rules, regulations,
orders,
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requirements and directions require structural and non-structural improvements,
alterations or repairs of the Premises.
(2) The "Cost of Assumable Maintenance and Repair" shall, for
each calendar year, consist of the sum of the "Operation and Maintenance Cost"
and the "Annual Capital Cost" which shall both be determined as follows:
(i) The Port Authority will determine the total of all costs
incurred or accrued during each calendar year in connection with the Assumable
Maintenance and Repair in accordance with normal Port Authority accounting
practice and as follows: The Port Authority will apportion Assumable Maintenance
and Repair performed between "operation and maintenance" and "capital work". The
cost of operation and maintenance is hereinafter called the "Operation and
Maintenance Cost" and the cost of the capital work is hereinafter called the
"Capital Cost".
(A) Operation and Maintenance Cost for each calendar
year shall consist of the following expenditures for, in connection with, or
related to operation and maintenance:
(aa) On-the-job payroll costs of employees and
supervisory personnel (including Airport supervisors, ▇▇▇▇▇▇▇ and clerks),
including, but not limited to, contributions to any retirement system or
the cost of or participation in any pension plans or the like, social
security, old age, survivor's, disability and unemployment insurance and
other insurance costs, sick leave pay, holiday, vacation, authorized
absence and severance pay, other employee fringe benefits and any other
payments made or costs incurred whether pursuant to law or by Port
Authority policy to or with respect to said employees and personnel;
(bb) The cost (including rental charges) of
materials, equipment, supplies and utilities (including but not limited to,
electricity, water and phone);
(cc) Payments to contractors and any other third
persons, firms or corporations for work performed or services rendered;
(dd) The cost of any performance bond or bonds;
(ee) The cost of insurance;
(ff) Any other direct costs as charged under the
Port Authority's normal accounting practice;
(gg) Twenty-five percent (25%) of the sum of all
of the foregoing items (aa) through (ff).
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(B) "Capital Cost" for each calendar year shall consist
of the following expenditures, for, in connection with, or related to capital
work:
(aa) On-the-job payroll costs of employees and
supervisory personnel (including Airport supervisors, foremen and clerks)
including but not limited to, contributions to any retirement system or the
cost of or participation in any pension plans or the like, social security,
old age, survivor's, disability and unemployment insurance and other
insurance costs, sick leave pay, holiday, vacation, authorized absence and
severance pay, other employee fringe benefits and any other payments made
or costs incurred whether pursuant to law or by Port Authority policy to or
with respect to said employees and personnel;
(bb) The cost (including rental charges) of
materials, supplies, equipment and utilities (including but not limited to
electricity, water and phone);
(cc) Payments to contractors and any other third
persons, firms or corporations for work performed or services rendered;
(dd) The cost of any performance bond or bonds;
(ee) The cost of any insurance;
(ff) Payments to independent consultants,
architects and engineers engaged or retained by the Port Authority;
(gg) Any other direct costs as charged under the
Port Authority's normal accounting practice;
(hh). Financial expense on the foregoing computed
in accordance with Port Authority accounting practice;
(ii) Ten percent (10%) of the sum of all the
foregoing items (aa) through (hh).
(C) "Annual Capital Cost" shall mean the total of all
annual amounts based upon the amortization of the Capital Cost for each calendar
year over the shorter of the weighted average period of the useful life of the
capital work for each calendar year, or the remaining term of this Agreement as
determined by the Port Authority. Each annual amount shall be determined on the
basis of an equal annual payment method. The rate used in determining the Annual
Capital Cost for all of the annual amounts shall be for each successive calendar
year an annual percentage rate equal to the sum of (i) the average of all the
weekly indices of the Bond Buyer Revenue Bond Index as reported in the
publication "The Bond Buyer" for the 52-week period in the immediately preceding
calendar year and (ii) three percentage points. For purposes of example and
illustration only, The Bond Buyer Revenue Bond Index for the week ending January
20, 2005 was 4.89% as set forth under the column "25-Bond Revenue"
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in the table entitled "Bond Buy Indexes" on page 37 of the Bond Buyer, Vol. 351
No. 32054, New York, N.Y., dated January 21, 2005. In the event that The Bond
Buyer or its weekly Bond Buyer Revenue Bond Index shall be discontinued during
the term of the letting hereunder, a comparable substitute for such Index shall
be mutually agreed upon in writing by the Lessee and the Port Authority within
thirty (30) days after discontinuance. In the event that the Port Authority and
the Lessee shall fail to agree upon such a substitute within the time
hereinabove specified then upon notice of either party such dispute shall be
disposed of by arbitration in accordance with the then existing rules of the
American Arbitration Association or any successor association. One half of the
cost of said arbitration shall be borne by the Port Authority and the other half
of said cost shall be borne by the Lessee.
(b) Commencement of Performance of Assumable Maintenance and Repair
(1) The "Assumable Maintenance and Repair Date" shall be the
date, from time to time, determined as follows:
(i) The Port Authority may at any time and from time to time
during the term of this Agreement advise the Lessee, by notice, of one or more
deficiencies in the performance by the Lessee of the Assumable Maintenance and
Repair, or in any portion, or portions, thereof. Such notice shall specify the
aforesaid deficiencies in reasonable detail. In such notice the Port Authority
shall also advise the Lessee of what reasonable period of time shall be afforded
the Lessee to cure such deficiencies and the Port Authority shall advise the
Lessee therein when and where its representatives may meet with representatives
of the Port Authority to discuss the foregoing. The Port Authority will consider
the response, if any, of representatives of the Lessee, as given at the
aforesaid meeting, or during such period for a further response from the Lessee,
as the Port Authority may, in its sole discretion, afford the Lessee. The Port
Authority may, after the occurrence of the above, advise the Lessee, by notice,
that it has elected not, at that time, to assume the performance of the
Assumable Maintenance and Repair. The Port Authority, in its sole discretion,
may condition such an election on such terms as it chooses to include in the
notice, including the taking of certain remedial or other actions by the Lessee
to the continuing satisfaction of the Port Authority. The fact that the Port
Authority may previously have given a notice under this subparagraph but has
subsequently elected on one or more occasions not to assume the performance of
the Assumable Maintenance and Repair or having on one or more occasions assumed
the Assumable Maintenance and Repair and thereafter returned the said
obligations to the Lessee pursuant to the provisions hereof, shall not be deemed
to limit the right of the Port Authority to, at any time, give another notice of
one or more deficiencies pursuant to this subparagraph or notice pursuant to
paragraph (b)(1)(ii) below.
(ii) The Port Authority may at any time and from time to
time during the term of this Agreement, but only after the issuance of a notice
described above and giving the opportunity to cure as provided above, advise the
Lessee, by notice, that commencing on a date to be specified in such notice,
which shall be not less than ninety (90) days after the giving thereof, the Port
Authority will perform the Assumable Maintenance and Repair. Such
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date as the same may be established from time to time shall be the "Assumable
Maintenance and Repair Date".
(c) Performance of the Assumable Maintenance and Repair
(1) The Port Authority shall perform the Assumable Maintenance
and Repair from and after the Assumable Maintenance and Repair Date with the
Cost of Assumable Maintenance and Repair to be paid by the Lessee as provided in
paragraph (d) below.
(2) The Lessee and the Port Authority each acknowledge and agree
that the rights and obligations of the Port Authority and the Lessee hereunder
are limited to the performance of all of the Assumable Maintenance and Repair by
the Port Authority and not of particular portions thereof.
(3) The Lessee shall give its full cooperation to the Port
Authority so as to better enable the Port Authority and its contractors to
perform the Assumable Maintenance and Repair and the Port Authority and its
employees, agents and contractors shall have the right to enter the Premises at
all reasonable times to perform the Assumable Maintenance and Repair.
(d) Payment for the Assumable Maintenance and Repair
The Cost of the Assumable Maintenance and Repair shall be payable
by the Lessee from and after the Assumable Maintenance and Repair Date as
follows:
(1) The Port Authority shall establish monthly interim billing
rates. Such billing rates shall be based upon determinations by the Port
Authority of its estimate of the Cost of the Assumable Maintenance and Repair
for the calendar year or; for the portion of the calendar year in which the
Assumable Maintenance and Repair Date, if less than a calendar year, shall occur
or for the portion of the calendar year during which the term of this Agreement
shall expire, if less than a calendar year. Such determinations shall be based
upon the prior calendar year's experience, if any, and upon other such
reasonable basis as the Port Authority shall select. The Port Authority may
prospectively revise its billing rates during any calendar year. The Lessee
shall pay current ▇▇▇▇▇▇▇▇ they are received.
(2) As soon as practicable after the expiration of each calendar
year, the Port Authority shall determine the actual Cost of the Assumable
Maintenance and Repair for the preceding calendar year and shall determine the
amounts payable by the Lessee. In the event the Assumable Maintenance and Repair
Date does not fall on the first day of a calendar year or in the event the term
of this Agreement expires on a day other than the last day of a calendar year
the Annual Capital Cost for said calendar year shall be prorated based on the
number of days during said calendar year during which the Port Authority
provides the Assumable Maintenance and Repair. Corrected ▇▇▇▇▇▇▇▇ based upon
such determination shall thereupon be rendered by the Port Authority to the
Lessee and if any monies are due to the Port Authority they shall be promptly
paid by the Lessee and if any monies are due to the Lessee they shall be
credited to it.
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(e) Limitation of Port Authority Obligations and No Waiver of Rights
of the Port Authority
(1) The right and obligation of the Port Authority to perform the
Assumable Maintenance and Repair shall not release, waive or affect the
obligations of the Lessee with respect thereto set forth in any provision of
this Agreement, nor limit, waive or effect any rights of termination with
respect thereto, including but not limited to, the right of the Port Authority
to terminate this Agreement, whether before or after the occurrence of the
Assumable Maintenance and Repair Date pursuant to Section 20 hereof entitled
"Termination by the Port Authority".
(2) The Port Authority shall not be obligated to the Lessee to
furnish the Assumable Maintenance and Repair at any time while the Lessee shall
be in default under this Agreement.
(3) No failure, delay or interruption in performing the Assumable
Maintenance and Repair by the Port Authority shall be or be construed to be an
eviction of the Lessee or grounds for the diminution or abatement of rentals,
fees, or other charges, or (unless resulting from the negligence or wilful
failure of the Port Authority) shall be grounds for any claims by the Lessee for
damages, consequential or otherwise.
(4) The Port Authority shall be under no obligation to perform
the Assumable Maintenance and Repair if and to the extent that during any period
such performance shall be prohibited, limited or rationed by any federal, state
or municipal law, rule, regulation, requirement, order or direction and if the
Port Authority deems it in the public interest to comply therewith, even though
such law, rule, regulation, requirement, order or direction may not be mandatory
on the Port Authority as a public agency. Furthermore, the obligation of the
Port Authority to perform the Assumable Maintenance and Repair shall be deemed
limited and modified during any period that repair or rebuilding of the Premises
is required pursuant to Section 10 hereof entitled "Care, Maintenance,
Rebuilding and Repair by the Lessee" or Section 12 hereof "Damage to or
Destruction of the Premises".
(f) Return of the Assumable Maintenance and Repair to the Lessee
(1) At any time and from time to time after the Port Authority
may have exercised its rights under this Section to perform the Assumable
Maintenance and Repair the Port Authority shall have the right, upon notice to
the Lessee to return the obligation to perform the Assumable Maintenance and
Repair to the Lessee commencing on a date to be specified in such notice which
date shall be not less than thirty (30) nor more than ninety (90) days from the
giving of such notice. Such date shall be the "Return Date of the Assumable
Maintenance and Repair". From and after the Return Date of the Assumable
Maintenance and Repair the Lessee shall perform the Assumable Maintenance and
Repair pursuant to and in accordance with all the terms and provisions of the
Lease including, but not limited to, this Section.
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(2) From and after the Return Date of Assumable Maintenance and
Repair the Lessee shall continue to pay the Cost of Assumable Maintenance and
Repair for all Assumable Maintenance and Repair performed prior to the Return
Date of the Assumable Maintenance and Repair, it being understood, that nothing
herein shall release or be deemed to release the Lessee from the payment to the
Port Authority of the Cost of Assumable Maintenance and Repair including that
portion thereof consisting of the Annual Capital Cost in accordance with
paragraph (d) hereof arising prior to the Return Date of the Assumable
Maintenance and Repair; nor shall anything herein require the Port Authority to
make any calculation or determination with respect to the Cost of Assumable
Maintenance and Repair prior to the time specified therefor in paragraph (d)
hereof.
SECTION 54. JOINT PERIODIC CONDITION SURVEY
In addition to and without limiting, Section 6 hereof entitled
"Compliance with Governmental Requirements", Section 7 hereof entitled "Rules
and Regulations", Section 8 hereof entitled "Various Obligations of the Lessee",
Section 9 hereof entitled "Prohibited Acts", Section 10 hereof entitled "Care,
Maintenance, Rebuilding and Repair by the Lessee", Section 11 hereof entitled
"Insurance", Section 12 hereof entitled "Damage to or Destruction of Premises",
Section 15 hereof entitled "Obstruction Lights", Section 16 hereof entitled
"Additional Rent and Charges", Section 17 hereof entitled "Rights of Entry
Reserved", Section 26 hereof entitled "Surrender", Section 53 hereof entitled
"Assumption of Maintenance and Repair of the Premises by the Port Authority",
Section 56 entitled "Environmental Obligations" and Section 61 entitled "Storage
Tanks" or any other term, provision, covenant or condition of this Agreement,
the Lessee and the Port Authority hereby agree that, in addition to any other
inspection of the Premises which may be made under any other Section of this
Agreement or otherwise, a Condition Survey (as hereinafter defined) of the
Premises shall be conducted by the Condition Survey Contractor (as hereinafter
defined) at the time period specified below subject to and in accordance with
the following terms and conditions:
(a) As used herein the following terms shall have the following
meanings:
(1) "Condition Survey" shall mean an inspection by the Condition
Survey Contractor of the Premises, including without limitation the then current
state of cleaning, maintenance, janitorial services, painting, structural and
nonstructural conditions, surface and subsurface conditions, environmental
conditions, lighting of building areas, ramp and apron areas, and the condition
of utilities and utility systems, fire-fighting and fire protection equipment
and systems, communications and communications systems, antipollution systems
and devices, fuel facilities and systems, and the Lessee's fixtures, equipment
and personal property, and also including the items mentioned or covered by
Sections 6, 7, 8, 9, 10, 11, 12, 15, 16, 17, 26, 53, 56 and 61 of this
Agreement;
(2) "Condition Survey Contract" shall mean and refer to a
contract awarded to a Condition Survey Contractor, or entered into between the
Port Authority and a Condition Survey Contractor, for the performance by such
Condition Survey Contractor of a Condition Survey at any of the applicable times
as specified in subparagraph (b) hereof;
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(3) "Condition Survey Contractor" shall mean and refer to the
contractor to whom the Condition Survey Contract is awarded pursuant to
subparagraph (b) hereof which Condition Survey Contractor shall be an
independent and reputable engineering firm, licensed or authorized to do
business in the State of New York;
(4) "Condition Survey Report" shall mean the report prepared by
the Condition Survey Contractor under its Condition Survey Contract after its
completion of the Condition Survey work under its Condition Survey Contract
including without limitation any and all recommendations for repair,
maintenance, rebuilding and cleaning of all items or areas covered by the
Condition Survey;
(5) "Costs of the Condition Survey" shall mean and include with
respect to each Condition Survey all amounts paid and expenses incurred by the
Port Authority, including all interest, costs, damages and penalties, in
accordance with the provisions of Section 16 entitled "Additional Rent and
Charges" for, relating to or in connection with Condition Survey work to be
performed under the Condition Survey Contract;
(6) "Report Date" shall mean the date of the Port Authority's
written notice to the Lessee by which the Port Authority delivers to the Lessee
the Condition Survey Report.
(b) No earlier than sixty (60) days preceding the expiration of each
period consisting of five (5) consecutive years occurring during the Term,
beginning with the first such five-year period which commences on DBO and ends
on the fifth anniversary of DBO and no earlier than sixty (60) days preceding
the last day of the month which constitutes the twelfth month preceding the
Expiration Date, the Port Authority may advise the Lessee of a proposed
Condition Survey Contract (which may include all or particular portions of the
items described in paragraph (a)(1) above) and including the name of the
proposed Condition Survey Contractor who will perform a Condition Survey and the
proposed scope of the proposed Condition Survey Contract and the proposed fee
structure of the contract. Within thirty (30) days after the Port Authority's
notice to the Lessee, the Lessee shall advise the Port Authority in writing of
its concurrence or objection to the proposed Condition Survey Contract. In the
event the Lessee fails to respond during the said time period, said nonresponse
shall be deemed a concurrence and the Port Authority shall proceed with the said
Condition Survey Contract for purposes of performing a Condition Survey. In the
event the Lessee notifies the Port Authority of its objections to the proposed
Condition Survey Contract or Condition Survey Contractor, the parties hereby
agree to consult with each other in good faith to resolve such dispute. If such
resolution is not reached within a reasonable period of time not to exceed
thirty (30) days, then the Port Authority, if it so elects, shall make a
determination as to the issue or issues in dispute. The parties hereby agree
that the Port Authority's determination of said issues, including the Condition
Survey Contract and the Condition Survey Contractor shall be final.
(c) It is hereby expressly understood and agreed that the selection of
each Condition Survey Contractor for the purposes of a Condition Survey and
including the award of any Condition Survey Contract to such Condition Survey
Contractor shall be subject to and consistent with the Port Authority's policies
and practices for the selection and award of similar
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contracts and the Port Authority shall have as full a right to require the use
of competitive bidding and award, or other basis of award, for any such
Condition Survey Contract as if the work on such contract were being performed
solely for the Port Authority; and further that the Condition Survey Contract
shall contain terms and conditions which are standard to Port Authority
contracts or consistent with such standard provisions.
(d) With respect to each Condition Survey, all Costs of the Condition
Survey shall be shared equally between the Port Authority and the Lessee.
Accordingly, the Lessee hereby agrees to pay to the Port Authority fifty percent
(50%) of the Costs of the Condition Survey with respect to each Condition Survey
as follows:
(1) The Lessee shall pay to or reimburse the Port Authority for
the Costs of the Condition Survey as follows: The Port Authority shall after the
completion of the Condition Survey work under a Condition Survey Contract and,
if it elects, also from time to time during the course of the performance of the
Condition Survey work under such Condition Survey Contract, submit to the Lessee
a certificate or certificates setting forth the Costs of the Condition Survey at
the date of each such certificate together with copies of all invoices in the
possession of the Port Authority for that portion of the Costs of the Condition
Survey covered by such certificate. Within thirty (30) days after the delivery
of each such certificate, the Lessee shall pay to the Port Authority an amount
representing fifty percent (50%) of said Costs of the Condition Survey as such
amount is set forth in said certificate. Upon its final determination of the
Costs of the Condition Survey, the Port Authority shall submit to the Lessee a
certificate marked "Final" setting forth the final determination of the Costs of
the Condition Survey with respect to each Condition Survey Contract as reduced
by any previous payment with respect to such Condition Survey Contract together
with copies of all invoices in the possession of the Port Authority for the
Costs of the Condition Survey not previously provided to the Lessee by the Port
Authority, and the Lessee shall and hereby agrees to pay to the Port Authority
within thirty (30) days of such certificate an amount representing fifty percent
(50%) of said Costs of the Condition Survey as such amount is set forth in said
certificate; provided, however, that neither the foregoing nor any certificate
delivered by the Port Authority, nor any payment made by the Lessee shall waive,
affect, or impair any right of the Port Authority of review and audit with
respect to the Costs of the Condition Survey and with respect to each Condition
Survey Contract and provided, further, however, that in the event any such
review or audit by the Port Authority requires an adjustment of the Costs of the
Condition Survey the Lessee shall be promptly credited with or shall pay to the
Port Authority all amounts required by such adjustment.
(2) Without limiting any of the terms and provisions of Section
16 hereof entitled "Additional Rent and Charges", any and all amounts required
to be paid by the Lessee hereunder may be added to any installment of rent
thereafter due under this Section and each and every part of the same shall be
and become additional rent, recoverable by the Port Authority in the same manner
and with like remedies as if it were part of the rent as set forth in Section 4
hereof entitled "Rental".
(e) The Lessee hereby agrees to and shall commence within ninety (90)
days after the Report Date all items and all action required or recommended to
be taken as set forth in each Contract Condition Survey Report that are
necessary or required to meet the Lessee's
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maintenance or repair or any other of its obligations, duties or
responsibilities under this Agreement and the written notice of the Port
Authority delivering said Report, unless the Port Authority expressly advises
the Lessee to the contrary as to any particular item(s), and the Lessee shall
diligently continue the same to completion; provided, however, that if the
Lessee notifies the Port Authority within thirty (30) day's after the Report
Date that it believes an item or action required or recommended to be taken by
the Condition Survey Report is not based upon sound engineering principles
together with the basis upon which the Lessee believes that such item or action
is not so based, the Lessee shall not be required to commence such item or
action unless and until the Port Authority shall have notified the Lessee that
the Chief Engineer of the Port Authority has determined that such item or action
is required or recommended based upon sound engineering principles, provided,
further, however, that notwithstanding the foregoing any and all items, action
or work related to or affecting or involving fire safety, health, structural
integrity, life safety, security and other emergency response systems shall be
promptly commenced.
(f) The Lessee hereby agrees that the Condition Survey Contractor
shall have all rights of entry to the Premises during all reasonable times as
appropriate or required to perform or complete the Condition Survey and the
Condition Survey Report under the Condition Survey Contract.
(g) It is expressly understood and agreed that neither the provisions
of this Section including without limitation the right of the Port Authority to
have the Lessee perform and complete the work required by the Condition Survey
Report, the obligation of the Lessee so to perform and complete such work, or
any such performance thereof by the Lessee, any failure of the parties to select
a Condition Survey Contractor, any failure of any Condition Survey Contractor to
perform and complete a Condition Survey Contract, nor any failure by the Lessee
or the Port Authority to pay the Costs of the Condition Survey with respect to
any Condition Survey Contract, or any portion thereof, shall or shall be deemed
to release, waive, affect, restrict or impair any of the obligations, duties,
responsibilities or liabilities of the Lessee under any term, provision,
covenant or condition of this Agreement nor to limit, waive, affect, restrict or
impair any right or remedy of the Port Authority including without limitation
any right of the Port Authority to terminate the letting hereunder whether
before or after the Report Date. Without limiting the foregoing, it is expressly
understood and agreed that the Lessee shall not postpone or delay any action,
maintenance, rebuilding or repair or other item or thing required to be taken by
the Lessee under any other section of this Agreement.
(h) Notwithstanding anything to the contrary, the Port Authority shall
have the right, exercisable in its sole and complete discretion, to exclude from
the scope of a Condition Survey with respect to any Condition Survey Contract
those items covered by Section 53 hereof for or during such period or periods,
if any, when the Port Authority has elected to exercise its rights under Section
53 hereof to perform the Assumable Maintenance and Repair.
SECTION 55. CONDITION OF THE PREMISES
The Lessee accepts the Premises in its "as is" condition and the Port
Authority shall not have any responsibility for any work or installation to the
Premises to make the same usable by the Lessee, to place it in any particular
condition or to reimburse the Lessee for any
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work or installation as may be made by or on behalf of the Lessee except as
expressly set forth in Sections 2, 28, 56 and 87 hereof, the Lessee having
exclusive responsibility therefore. The Lessee hereby acknowledges that it has
not relied upon any representation or statement of the Port Authority or its
Commissioners, officers, employees or agents as to the condition of the
Premises. The Lessee, prior to any portion of the Premises becoming a part of
the Premises hereunder, thoroughly examined or shall examine, as the case shall
be, such portion of the Premises and determined it to be suitable for the
Lessee's operations under the Lease.
SECTION 56. ENVIRONMENTAL OBLIGATIONS
(a) For the purposes of this Lease, the following terms shall have the
respective meaning provided below:
(1) "Additional Baseline" shall mean a report prepared by the
Port Authority summarizing all test results from the soil and groundwater
samples taken as part of Additional Baseline Work and as set forth in paragraphs
(9) and (10) of Exhibit 56.1 and showing all the calculations to determine for
each Additional Zone and each Zone that has been reconfigured as a result of the
creation of an Additional Zone, the Soil Threshold Level and the Ground Water
Threshold Level for each Analyzed Item in accordance with paragraph (j) of
Section 56 of the Lease.
(2) "Additional Baseline Work" shall mean the subsurface testing
of the soil and ground water of the Premises, the Terminal 4 Parcel and the
Terminal 6 Parcel performed by the Port Authority to delineate the extent of
Free Product that is identified in the Initial Post Construction Baseline. Such
testing shall be performed in accordance with paragraphs 5, 7, 8, 9 and 10 of
Exhibit 56.1.
(3) "Analyzed Item" shall mean each of the parameters set forth
in paragraph 9 of Exhibit 56.1 and for which test results are set forth in the
Initial Post Construction Baseline.
(4) "Condition Exceptions" shall mean the following:
(i) The remediation or removal (including investigation
conducted as part of such remediation or removal but in no event shall the
performance or costs of the testing and the preparation of the report performed
as part of the Exit Baseline or the Initial Post Construction Baseline Work, as
opposed to the results, be a Condition Exception) of the Existing Condition;
(ii) The remediation or removal (including investigation
conducted as part of such remediation or removal but in no event shall
performance or costs of the testing and the preparation of the report performed
as part of the Exit Baseline or the Initial Post Construction Baseline Work, as
opposed to the results, be a Condition Exception) of Hazardous Substances in the
soil or ground water in, on or under the Premises caused by the sole acts or
omissions of the Port Authority on or after the Effective Date,
(iii) Fines and penalties arising out of the Existing
Condition if the fines and penalties are imposed due to the failure to have
remediated or removed the Existing
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Condition, provided, however, if the Lessee shall not have complied with the
terms and conditions of paragraph (l) of this Section or of Section 17 hereof,
then the foregoing shall not be a Condition Exception;
(iv) The remediation or removal of Migrated Hazardous
Substances; and
(v) For the period from and after the Initial Post
Construction Baseline Effective Date only, the remediation or removal of any
Hazardous Substance discovered subsequent to the Initial Post Construction
Baseline Effective Date (x) that is not an Analyzed Item and (y) that the Lessee
is able to establish or prove to the reasonable satisfaction of the Port
Authority existed in or on the Premises prior to the Effective Date and, if such
Hazardous Substance existed on the Premises prior to the Effective Date, that
its presence on the Premises was not caused by or resulted from a Lessee's Act.
(5) "Exhibit 56.1" shall mean the exhibit attached hereto, hereby
made a part hereof and marked "Exhibit 56.1" and entitled "Initial Post
Construction Baseline Investigation".
(6) "Exhibit 56.2" shall mean the exhibit attached hereto, hereby
made a part hereof and marked "Exhibit 56.2" and entitled "Sampling Locations
for the Initial Post-Construction Baseline".
(7) "Exhibit 56.3" shall mean the exhibit attached hereto, hereby
made a part hereof and marked "Exhibit 56.3" and entitled "JFK Terminal 5 -
Sampling Zones and Subzones".
(8) "Exhibit 56.4" shall mean the exhibit attached hereto, hereby
made a part hereof and marked "Exhibit 56.4 and entitled "JFK Terminal 5 -
Historical Port Authority Analyzed Items".
(9) "Existing Condition" shall mean:
(i) for the period from and including the Effective Date to
and including the day prior to the Initial Post Construction Baseline Effective
Date for any portion of the Premises, the Existing Condition shall mean the
levels and types of Hazardous Substances in the soil and ground water located
in, on and under the Premises except for Lessee Hazardous Substances or
Hazardous Substances which were added to the Premises or the ground water in or
thereunder on or after the Effective Date, and
(ii) for the period from and after the Initial Post
Construction Baseline Effective Date and subject to the terms and provisions of
paragraph (q) of this Section, with respect to the soil within each Zone, the
Soil Threshold Level for each Analyzed Item in such Zone and with respect to the
ground water within each Zone, the Ground Water Threshold Level for each
Analyzed Item for such Zone.
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(10) "Exit Baseline" shall mean the sampling and testing of the
soil and groundwater in, on and under the Premises between eight and six months
immediately preceding the expiration of the letting hereunder or, in the case of
an earlier termination of the letting hereunder, then within ninety (90) days
the effective date of such termination and the preparation of the Exit Baseline
Report, such sampling, testing and report to be performed and prepared in
accordance with the terms and conditions set forth in paragraph (v) of this
Section, the following additional requirements and in accordance with such
further standards, methods, protocol and procedures as shall be required by the
Port Authority in it sole discretion. Such sampling, testing and the preparation
of any associated report shall be performed by a New York State certified
independent consultant and laboratory. Soil and water samples shall be taken
from not less than one location within each area identified on Exhibit 56.3 and
in not less than the number of locations in each Additional Zone upon which the
Existing Condition for such Additional Zone is based. Each sample shall be
tested for all Analyzed Items. If the Lease has not been terminated by the Port
Authority, then the Port Authority shall consult with the Lessee on the
standards, methods, protocol and procedures to be used in the Exit Baseline and
the Lessee shall select the sampling locations in those areas that are shown in
shading on Exhibit 56.3 and the Port Authority shall select the sampling
locations in all the remainder of the areas identified on Exhibit 56.3, except,
however, the Lessee shall select half of the sampling locations in each
Additional Zone and the Port Authority shall select half of the sampling
locations in each Additional Zone.
(11) "Exit Baseline Report" shall mean a report summarizing all
of the test results from the soil and groundwater samples taken as part of the
Exit Baseline compiled and entered into both Excel spreadsheets as well as
electronic data deliverable format for import into EquIS database and if Excel
and or EquiIS database are no longer available then in such spreadsheet and
format as shall be determined by the Port Authority. All test results from
samples taken within a Zone shall be grouped into sub-data sets. The sampling
results that fall within the boundaries of a Zone shall be associated with that
Zone. Additionally, such report shall show all the calculations to determine for
each Zone the Exit Soil Threshold Level and the Exit Ground Water Threshold
Level for each Analyzed Item in accordance with paragraph (v) of this Section.
(12) "Free Product" shall mean ground water that contains free
phase petroleum hydrocarbons having a thickness of 0.01 feet or greater.
(13) "Initial Post Construction Baseline Work" shall mean the
subsurface testing of the soil and ground water in and under the Premises, the
Terminal 4 Parcel and Terminal 6 Parcel and the preparation of the Initial Post
Construction Baseline performed in accordance with the terms and conditions set
forth in paragraph (m) of this Section and in Exhibit 56.1, Exhibit 56.2 and
Exhibit 56.3.
(14) "Lessee's Act" shall mean any act or omission of the Lessee
or of any affiliated company of the Lessee or of any of their agents,
contractors, sublessees, representatives, or others on the Premises with the
consent of the Lessee or any affiliated company of the Lessee (excluding,
however, use by third parties of any right of way through the Premises granted
by this Agreement) or over whom the Lessee has control.
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(15) "Lessee's Cost of the Exit Baseline" shall mean the sum of
the amounts paid by the Lessee to independent third party engineers, architects,
consultants and other professionals, construction supervisors and contractors
for work actually performed and labor and materials actually furnished in
connection with the Exit Baseline inclusive of sales, use and like taxes where
applicable, and such amounts only (but only to the extent such amounts are
included in the Exit Baseline Certificate, as such amounts may be adjusted
pursuant to the provisions of subparagraph (8) of paragraph (v) of this Section)
actually paid by the Lessee for the Exit Baseline, to the extent that the
inclusion of the same is permitted by generally accepted accounting principles
consistently applied, provided, however, (x) the Lessee's Cost of the Exit
Baseline shall be limited to work covered by the Exit Baseline Certificate
submitted by the Lessee pursuant to and in accordance with subparagraph (4) of
paragraph (v) of this Section; and (y) it is specifically understood and agreed
that no amounts paid for or in connection with any trade fixtures or other
personal property of the Lessee or any payment or payments on account of any
administrative or other overhead costs of the Lessee whether or not allocated to
the Exit Baseline by the Lessee's own accounting practices shall be included in
the Lessee's Cost of the Exit Baseline; and (z) the Lessee's Cost of the Exit
Baseline shall not include any payment to a firm or corporation wholly or
partially owned by or in common ownership with the Lessee or any Exit Baseline
that is not performed in accordance with all of the terms and provisions of this
Agreement.
(16) "Lessee's Cost of the Initial Post Construction Baseline "
shall mean the sum of the amounts paid by the Lessee to independent third party
engineers, architects, consultants and other professionals, construction
supervisors and contractors for work actually performed and labor and materials
actually furnished in connection with the Initial Post Construction Baseline
inclusive of sales, use and like taxes where applicable, and such amounts only
(but only to the extent such amounts are included in the Initial Post
Construction Baseline Certificate, as such amounts may be adjusted pursuant to
the provisions of subparagraph (7) of paragraph (m) of this Section) actually
paid by the Lessee for the Initial Post Construction Baseline, to the extent
that the inclusion of the same is permitted by generally accepted accounting
principles consistently applied, provided, however, (x) the Lessee's Cost of the
Initial Post Construction Baseline shall be limited to work covered by the
Initial Post Construction Baseline Certificate submitted by the Lessee pursuant
to and in accordance with subparagraph (3) of paragraph (m) of this Section; and
further (y) it is specifically understood and agreed that no amounts paid for or
in connection with any trade fixtures or other personal property of the Lessee
or any payment or payments on account of any administrative or other overhead
costs of the Lessee whether or not allocated to the Initial Post Construction
Baseline Work by the Lessee's own accounting practices shall be included in the
Lessee's Cost of the Initial Post Construction Baseline; and (z) the Lessee's
Cost of the Initial Post Construction Baseline shall not include any payment to
a firm or corporation wholly or partially owned by or in common ownership with
the Lessee or any Initial Post Construction Baseline Work that is not performed
in accordance with all of the terms and provisions of this Agreement.
(17) "Migrated Hazardous Substances" shall mean (i) any Hazardous
Substance that has migrated onto the Premises from outside the Premises and (ii)
any Hazardous Substance constituting a part of the Existing Condition that has
migrated within or from the
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Premises, provided, however, in each case, except in the case of excavated soils
used or redeposited at the Redevelopment Work Sites pursuant to and in
accordance with the all Environmental Requirements, including without limitation
the Remedial Action Work Plan, Migrated Hazardous Substances shall in no event
include any Hazardous Substances that have migrated as a result of or in
connection with any Lessee's Act.
(18) "Port Authority's Cost of the Exit Baseline" shall mean and
include all amounts paid and expenses incurred by the Port Authority, including
all interest, costs, damages and penalties, in accordance with the provisions of
Section 16 entitled "Additional Rent and Charges" for, relating to or in
connection with the Exit Baseline.
(19) "Post Construction Baseline " shall mean the Initial Post
Construction Baseline, as the same may be supplemented and amended pursuant and
subject to paragraph (n) of this Section by the test results set forth in all
Remediation Completion Reports and/or by the test results in all Additional
Baselines.
(20) "Zone" shall mean each of the 8 zones identified in Exhibits
56.2 and 56.3 and each Additional Zone.
(b) (1) Without limiting the generality of any of the other terms and
provisions of this Lease and subject to the terms and provisions of paragraph
(b)(2) of this Section, the Lessee hereby expressly agrees to assume all
responsibility for, relieve the Port Authority from, and reimburse the Port
Authority for, any and all risks, claims, penalties, costs and expenses of any
kind whatsoever caused by, arising out of or in connection with, the condition
of the Premises whether any aspect of such condition existed prior to, on or
after the Lease Commencement Date, including without limitation all
Environmental Requirements and all Environmental Damages and to indemnify and
hold harmless the Port Authority for all such risks, claims, penalties,
responsibilities, costs and expenses.
(2) It is hereby agreed and understood that except as set forth
in paragraphs (k), (q) and (r) of this Section and in Sections 2(g)(12) and 87
of this Lease, the Lessee shall not be responsible for the Condition Exceptions.
(c) Without limiting the Lessee's obligations elsewhere under this
Agreement to comply with all laws, ordinances, governmental rules, regulations
and orders which were or at any time are in effect during the term of the
letting under this Agreement, the Lessee understands and agrees that, except
with respect to the Condition Exceptions for which the Lessee is not responsible
for pursuant to paragraph (b)(2) of this Section, it shall be obligated, at its
cost and expense, to comply with and relieve the Port Authority from compliance
with all Environmental Requirements which are applicable to or which affect (i)
the Premises with the exception only of Migrated Hazardous Substances, (ii) the
operations of, or work performed by, the Lessee or others with the consent of
the Lessee at the Premises or the Lessee's operations at the Airport, (iii) the
occupancy and use of the Premises by the Lessee or by others with its consent or
(iv) any Hazardous Substance which has migrated from the Premises with the
exception only of Migrated Hazardous Substances and shall in accordance with and
subject to the provisions of Section 2 hereof entitled "Construction by the
Lessee" or Section 33 hereof entitled "Other Construction of the Lessee", as the
case shall be, perform all remediation, containment and clean-up of
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Hazardous Substances required in order to fully satisfy the compliance
obligations set forth herein. Nothing in the foregoing shall be construed as a
submission by the Port Authority to the application to itself of any
Environmental Requirements; provided, however, that no immunity or exemption of
the Port Authority from any Environmental Requirements shall excuse compliance
or be grounds for noncompliance on the part of the Lessee. Except with respect
to the Condition Exceptions for which the Lessee is not responsible for pursuant
to paragraph (b)(2) of this Section and without limiting the generality of the
foregoing and as part of the Lessee's fulfillment of the foregoing obligations,
the Lessee shall be responsible, at its sole cost and expense and subject to the
direction of the Port Authority, for:
(1) the preparation of and submission to all applicable
Governmental Authorities of any notice, negative declaration, remedial action
workplan, no further action letter, remediation agreement or any other
documentation or information;
(2) the obtaining of any surety bond or the giving of any other
financial assurances; and
(3) complying with the provisions of all Environmental
Requirements becoming effective on or relating to the termination, expiration or
surrender of the letting of the Premises or of any portion thereof under this
Agreement, or on the closure or transfer of the Lessee's operations at the
Premises.
(d) In addition to and without limiting the generality of the
obligations of the Lessee set forth above and elsewhere in this Agreement, the
Lessee shall, at its sole cost and expense and in accordance with and subject to
the provisions of Section 33 of this Agreement, upon notice from the Port
Authority, promptly take all actions to:
(1) (i) completely remove and remediate (i) all Hazardous
Substances in, on and under the Premises and at the Airport resulting from or in
connection with the use and occupancy of the Premises by the Lessee or any
affiliated company of the Lessee or which have been or permitted to be disposed
of, released, discharged or otherwise placed in, on or under the Airport by the
Lessee or any affiliated company of the Lessee and (ii) all Hazardous Substances
which have been disposed of, released, discharged or otherwise placed in, on or
under the Premises during the term of the letting of the Premises under this
Agreement or during the term of any previous agreement between the Lessee or any
affiliated company of the Lessee and the Port Authority covering the Lessee's or
any such affiliated company's use and/or occupancy of the Premises or any
portion thereof, except for Hazardous Substances caused by the sole acts or
omissions of the Port Authority or Port Authority contractors on or after the
Effective Date, provided, however, Port Authority contractors shall for the
purpose of this paragraph (d) shall in no event include the System Operator even
when acting as the contractor of the Port Authority, and further, provided,
however, that the redepositing of soil in compliance with Section 2 hereof in
the performance of the Construction Work shall not be or be deemed to resulting
from or in connection with the use and occupancy of the Premises or a Hazardous
Substance disposed of, released, discharged or otherwise placed in, on or under
the Premises for the purposes of this paragraph (d)(1);
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(2) except with respect to the Condition Exceptions which the
Lessee is not responsible for pursuant to paragraph (b)(2) of this Section,
remove and remediate all Hazardous Substances in, on or under the Premises or
which have migrated from or from under the Premises to any other property which
any Governmental Authority or any Environmental Requirement or any violation
thereof require to be remediated or removed; and
(3) except with respect to the Condition Exceptions which the
Lessee is not responsible for pursuant to paragraph (b)(2) of this Section,
remove and remediate all Hazardous Substances which were in, on or under the
Premises and which have migrated from or from under the Premises necessary to
mitigate any Environmental Damages.
(e) The obligations set forth in paragraphs (c) and (d) of this
Section shall include but not be limited to the investigation of the
environmental condition of the area to be remediated, the preparation of
feasibility studies, reports and remedial plans and the performance of any
removal, remediation, containment, operation, maintenance, monitoring or
restoration work and shall be performed in a good, safe and workmanlike manner.
The Lessee shall promptly provide the Port Authority with copies of all test
results and reports generated in connection with such obligations. The Lessee
shall seal or cap all monitoring ▇▇▇▇▇ and test holes as required by all
Environmental Requirements, remove all associated equipment and restore the
remediated property.
(f) Subject to the terms and conditions of paragraph (u) of this
Section and without limiting the Port Authority's remedies under this Agreement
or at law or in equity, the Port Authority shall have the right during and after
the term of the letting of the Premises under this Agreement to such equitable
relief, including restraining injunctions and declaratory judgments, to enforce
compliance by the Lessee of its environmental obligations under this Agreement
including without limitation all the Lessee's obligations under this Section. In
the event that the Lessee fails to comply with or perform any of such
obligations, the Port Authority at any time during the term or subsequent to the
termination, expiration or surrender of the letting of the Premises or any
portion thereof may elect (but shall not be required) to perform such
obligations and upon demand the Lessee shall pay to the Port Authority as
additional rent its costs thereof, including all overhead costs as determined by
the Port Authority. For the purposes of this paragraph, the term "cost" shall be
as defined in Section 16 of this Agreement.
(g) Without limiting any other of the Lessee's obligations under the
Lease and except with respect to the Condition Exceptions which the Lessee is
not responsible for pursuant to paragraph (b)(2) of this Section, the Lessee
shall provide the General Manager of the Airport at the cost and expense of the
Lessee with such information, documentation, records, correspondence, notices,
reports, tests, results, and certifications and any other information as the
Port Authority shall request in connection with any Environmental Requirements
which the Lessee is obligated to comply with pursuant to this Agreement or
Environmental Damages and the Lessee shall promptly acknowledge, swear to (if
required ), sign or otherwise fully execute the same. The Lessee agrees that any
of the foregoing may be filed by the Port Authority with the appropriate
Governmental Authority on behalf of the Lessee at the Lessee's cost and expense.
Further, the Lessee agrees unless directed otherwise by the Port Authority, to
provide the General Manager of the Airport with copies of all information,
documentation, records,
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correspondence, notices, certifications, reports, test results and all other
submissions provided by the Lessee to a Governmental Authority and by a
Governmental Authority to the Lessee within five (5) days that the same are made
available to or received by the Lessee with respect to any Environmental
Requirements or any Environmental Damages.
(h) Without limiting the generality of any other provision contained
in this Agreement and except with respect to Condition Exceptions which the
Lessee is not responsible for pursuant to paragraph (b)(2) of this Section, the
Lessee shall indemnify, hold harmless and reimburse the Port Authority, its
Commissioners, officers, employees and representatives from all claims, demands,
penalties, fines, liabilities (including strict liability), settlements,
attorney and consultant fees, investigation and laboratory fees, removal and
remediation costs, court costs and litigation expenses, damages, judgments,
losses, costs and expenses of whatsoever kind or nature and whether known or
unknown, contingent or otherwise, just or unjust, groundless, unforeseeable or
otherwise, arising or alleged to arise out of or in any way related to any
Environmental Damages or any Environmental Requirement which the Lessee is
obligated to comply with pursuant to this Agreement, or the risks and
responsibilities assumed hereunder by the Lessee for the condition of the
Premises or a breach or default of the Lessee's obligations under this Section
and under paragraphs (b)(2)(iii)(bb), (b)(2)(viii)(dd), (g)(12), (g)(25),
(g)(26), (g)(30), (g)(32), (g)(33), (g)(34) and (o) of Section 2 hereof. If so
directed, the Lessee shall at its own expense defend any suit based upon the
foregoing, and in handling such it shall not, without obtaining express advance
permission from the General Counsel of the Port Authority, raise any defense
involving in any way the jurisdiction of the tribunal over the person of the
Port Authority, the immunity of the Port Authority, its Commissioners, officers,
agents or employees, the governmental nature of the Port Authority or the
provisions of any statutes respecting suits against the Port Authority.
(i) (1) Without limiting the generality of any provision of this
Agreement, in the event that any Environmental Requirement sets forth more than
one compliance standard, the Lessee agrees that the standard or standards to be
applied in connection with any obligation it may have under this Agreement with
respect to said Environmental Requirement shall be that which requires or
permits the lowest level of a Hazardous Substance, provided, however, in the
event such lowest level of a Hazardous Substance requires or allows the
imposition of any restriction of any nature whatsoever upon the use or occupancy
of the Premises or any other portion of the Airport or upon any operations or
activities conducted or to be conducted on the Premises or the Airport or upon
the transfer of the Premises or the Airport, then the Lessee shall remediate to
such a level so that there is no such restriction placed upon the use and
occupancy of the Premises or the Airport or upon any operations or activities
conducted or to be conducted on the Premises or the Airport.
(2) Nothing in this paragraph (i) shall require or be construed
to require the Lessee to remediate below the Existing Condition except as
otherwise required by or as set forth in this Agreement including without
limitation as required by or as set forth in paragraphs (k), (q) and (r) of this
Section and Section 2 hereof.
(j) From and after the Initial Post Construction Baseline Effective
Date, the methodology to be used to determine the Ground Water Threshold Level
for each and every
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Analyzed Item within each Zone and to determine the Soil Threshold Level for
each and every Analyzed Item within each Zone shall be as follows:
(1) Only the ground water and soil test results set forth in the
Post Construction Baseline shall be used to calculate the Ground Water Threshold
Levels and the Soil Threshold Levels.
(2) No test results from soil samples containing any Lessee
Hazardous Substance shall be used to calculate any Soil Threshold Level and no
test results from ground water samples containing any Lessee Hazardous Substance
shall be used to calculate any Ground Water Threshold Level.
(3) Analyzed Items not detected for a given ground water sample
shall be assigned a concentration equal to half of the ground water detection
limit for such Analyzed Item and Analyzed Items not detected for a given soil
sample shall be assigned a concentration equal to half of the soil detection
limit for such Analyzed Item.
(4) The maximum concentration of each Analyzed Item in the ground
water samples taken from a location shall be used to represent the concentration
of that Analyzed Item in the ground water at that location and the maximum
concentration of each Analyzed Item in the soil samples taken from a location
shall be used to represent the concentration of that Analyzed Item in the soil
at that location.
(5) The mean concentration of an Analyzed Item in the ground
water (i.e. the "WM") shall be calculated for each Zone using the following
equation: WM = (X1 + X2 + .....+ Xn) / n; where "X" shall equal the maximum
concentration of an Analyzed Item in the ground water at one sample location and
"n" shall equal the number of ground water sample locations in such Zone.
(6) The mean concentration of an Analyzed Item in the soil (i.e.
the "SM") shall be calculated for each Zone using the following equation: SM =
(Y1 + Y2 + .....+ Yn) / n; where "Y" shall equal the maximum concentration of an
Analyzed Item in the soil at one sample location and "n" shall equal the number
of soil sample locations in such Zone.
(7) The standard deviation for each Analyzed Item in the ground
water shall be calculated for each Zone using the following equation:
(2) (2) (2) (1/2)
SD ={[(X1 - WM) + (X2 - WM) +...+ (Xn - WM) ]/(n -1)}
(8) The standard deviation for each Analyzed Item in the soil
shall be calculated for each Zone using the following equation:
(2) (2) (2) (1/2)
SD ={[(Y1 - SM) + (Y2 - SM) +...+ (Yn - SM) ]/(n -1)}
(9) A ground water threshold level for each Analyzed Item shall
be calculated for each Zone using the following equation: Ground Water Threshold
Level = 1.3 x (WM + SD). The ground water threshold level as so calculated for
each Analyzed Item in ground water of a Zone is herein called a "Ground Water
Threshold Level").
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(10) A soil threshold level for each Analyzed Item shall be
calculated for each Zone using the following equation: Soil Threshold Level =
1.3 x (SM + SD). The soil threshold level as so calculated for each Analyzed
Item in soil of a Zone is herein called a "Soil Threshold Level").
(k) (1) Except as provided in paragraph (g)(12) of Section 2 and in
Section 87 hereof, it is expressly understood and agreed that the proper
handling, delivery, treatment, storage, transportation, disposal and depositing
(all of the foregoing being hereinafter collectively called "Disposal"), whether
on or off the Airport, of any soil, dirt, sand, silt, water, asbestos, lead,
PCB's, demolition or construction debris or other matter (hereinafter
collectively called the "Matter") excavated, disturbed or removed by the Lessee
(or by any contractor or contractors of the Lessee) at, from or under the
Premises (or any other area of the Airport ) at any time or times and regardless
of the nature or composition of such Matter, including without limitation, any
and all Disposal of said Matter in connection with the performance of the
Construction Work or the repair, replacement or rebuilding of the Premises as
required under Section 10 of this Agreement, and any and all remediation and
Disposal of said Matter and any and all other remediation and Disposal (whether
soil, upper aquifer or otherwise) necessary, required or appropriate as a result
of, caused by, incidental to or triggered by such excavation, disturbance or
removal of the Matter or arising therefrom, and the taking or doing of any and
all other action or actions necessary, required or appropriate in connection
therewith shall be the sole and complete responsibility of the Lessee,
including, without limitation, all costs and expenses thereof and any and all
Environmental Damages, applicable Environmental Requirements, claims, penalties
and other expenses relating thereto. The foregoing obligations of the Lessee
shall obtain and apply with full force and effect irrespective of the nature or
source of any contaminant, pollutant, chemical, waste or other substance or
whether any of the same is a Hazardous Substance or whether any of the same is
at a level or levels above or below the Existing Condition or whether there has
or has not been any decrease or increase in such level or levels. The Lessee
shall perform all of the foregoing in accordance with and subject to all the
terms, provisions, covenants and conditions of this Agreement.
(2) Without limiting the generality of any other term or
condition of this Agreement, title to any Matter on the Premises or the Airport
excavated or removed by the Lessee and not used at the Premises shall vest in
the Lessee upon the excavation or removal thereof, except as set forth in
paragraph (g)(12) of Section 2 hereof, and all such Matter shall be delivered
and deposited by the Lessee at the Lessee's sole cost and expense to a location
off the Airport in accordance with the terms and conditions of this Agreement
and all applicable Environmental Requirements.
(3) In the event the Lessee discovers any Hazardous Substance in,
on or under the Premises, the Lessee in reporting such Hazardous Substance shall
direct such report to the attention of such individual at the subject
governmental authority as the General Manager of the Airport shall require in
order to assure consistency in the environmental management of the Airport,
provided, however, notwithstanding the foregoing in no event shall the Lessee be
required by this paragraph (k)(3) to violate any Environmental Requirement.
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(4) Promptly upon final disposition by the Lessee of any
Hazardous Substance from the Premises or the Airport, the Lessee shall submit to
the Port Authority a "Certification of Final Disposal" stating the type and
amount of material disposed, the method of disposal and the owner and location
of the disposal facility. The format of such certification shall follow the
requirements, if any, of governmental agencies having jurisdiction as if the
Port Authority were a private organization and the name of the Port Authority
shall not appear on any certificate or other document as a generator or owner of
such material, except as provided in paragraph (g)(12) of Section 2 hereof.
(l) Without limiting the foregoing and without limiting the generality
of the provisions of Section 17 of this Lease and subject to and in accordance
with said Section 17, the Port Authority and its designees, shall have the right
but not the obligation to enter upon the Premises upon forty-eight (48) hours'
notice to the Lessee or on such shorter notice if any Environmental Requirement
or the DEC or other governmental entity should require more immediate action by
the Port Authority, to conduct testing and related activities from existing
▇▇▇▇▇, if any, to make additional ▇▇▇▇▇ and borings and to conduct testing and
related activities therefrom and to perform such activities as shall be
necessary to remediate the Existing Condition, including but not limited to,
conducting pumping operations from said ▇▇▇▇▇. In the exercise of the foregoing
rights the Port Authority and its designees shall not unreasonably interfere
with the use and occupancy of the Premises by the Lessee. From and after the use
of any Gate, if any of the foregoing activities are required to be performed in
the vicinity of such Gate, the Port Authority and its designees shall at a
minimum, have unrestricted access to such Gate and adjoining areas daily between
the hours of 11:00 p.m. and 5:00 a.m.
(m) Initial Post Construction Baseline:
(1) Establishment of Initial Post Construction Baseline Sampling
Locations:
In the event that during the period from the Effective Date
to the date that the last sample is taken as part of the Initial Post
Construction Work (the "Initial Post Construction Baseline Effective Date"),
both dates inclusive, an Unknown Environmental Condition shall have been
discovered and such Unknown Environmental Condition shall not contain any Lessee
Hazardous Substances, then in addition to the locations set forth in Exhibits
56.2 and 56.3, the Initial Post Construction Baseline Work shall include, at a
minimum, the installation of one monitoring well and the taking of one soil and
one ground water sample and the testing thereof as provided in this paragraph
(m) and in Exhibit 56.1 hereof from such location or locations as shall be
determined by the Port Authority within the area where the Unknown Environmental
Condition was recorded pursuant to paragraph (g)(12) of Section 2 hereof (each
such location an "Additional Sampling Location").
(2) Performance of the Initial Post Construction Baseline:
The Lessee shall perform the Initial Post Construction
Baseline Work in accordance with the terms and conditions set forth in this
paragraph (m), Section 33 hereof and in Exhibit 56.1, Exhibit 56.2 and Exhibit
56.3. Such post construction baseline shall
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be performed on the Premises, the Terminal 4 Parcel and Terminal 6 Parcel as
soon as practicable subsequent to the completion of the Airside Civil Work or a
portion thereof that is to be performed on the Premises as part of the
Redevelopment Work but not later than the earlier to occur of the date of
delivery of the first certificate delivered by the Lessee pursuant to paragraph
(n)(2)(ii) of Section 2 hereof for the Airside Civil Work and the date that the
first Enplanement shall occur. The draft post construction baseline test results
referred to in Exhibit 56.1 shall be delivered by the Lessee to the Port
Authority within ninety (90) days after the last sample is taken in the
performance of the Initial Post Construction Baseline Work and, subject to the
terms and conditions of paragraph (n) of this Section, from and after the
Initial Post Construction Baseline Effective Date, the Initial Post Construction
Baseline shall be and become the test results used to calculate the Existing
Condition in accordance with this Section.
(3) Payment for the Cost of the Initial Post Construction
Baseline:
The Lessee's Cost of the Initial Post Construction Baseline
shall be shared equally between the Port Authority and the Lessee. Accordingly,
the Port Authority shall pay to the Lessee an amount equal to 50% of the
Lessee's Cost of the Initial Post Construction Baseline within ninety (90) days
after the date that the Lessee shall have delivered to the Port Authority the
Initial Post Construction Baseline Certificate.
(4) Initial Post Construction Baseline Certificate:
The Lessee shall deliver to the Port Authority within ninety
(90) days after the Initial Post Construction Baseline Effective Date a
notarized certificate of the Lessee covering the Lessee's Cost of the Initial
Post Construction Baseline meeting all the requirements set forth in this
paragraph (m)(4) (such certificate meeting all of the requirements of this
paragraph (m)(4) and which is delivered to the Port Authority on or before the
ninetieth (90th) day after the Initial Post Construction Baseline Effective Date
is hereinafter referred to as the "Initial Post Construction Baseline
Certificate"), which certificate shall be signed by a responsible fiscal officer
of the Lessee, notarized and shall further:
(i) set forth, in reasonable detail, the amounts paid to
specified independent third party contractors and the amounts of payments made
to other specified Persons for the Lessee's Cost of the Initial Post
Construction Baseline and certify that such amounts constitute portions of the
Lessee's Cost of the Initial Post Construction Baseline;
(ii) have attached thereto reproduction copies or duplicate
originals of the invoices of such independent third party contractors and other
Persons and an acknowledgment by such independent contractors and other Persons
of the receipt by them of such amounts and payments;
(iii) certify that the amounts and payments therein set
forth constitute all of the Initial Post Construction Baseline Work; that the
Initial Post Construction Baseline covered by the certificate has been
accomplished and that it has been performed in accordance with all the terms and
provisions of this Lease; and that the work covered by the
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certificate was performed by the Lessee prior to the Initial Post Construction
Baseline Effective Date; and
(iv) certify there is no outstanding indebtedness known to
the Lessee, after due and diligent inquiry, then due on account of the Initial
Post Construction Baseline Work which, if unpaid, might become the basis of a
vendor's, mechanic's, laborer's or materialmen statutory or other lien or
alleged lien upon the Airport or any part thereof, or upon the Lessee's
leasehold interest therein, provided that the foregoing shall not limit or
impair Section 20 hereof or any rights or remedies of the Port Authority under
this Lease or otherwise.
(5) Nothing contained herein shall be deemed or construed as a
submission by the Port Authority to the application to itself of any lien
described in this paragraph (m) or to limit or impair Section 20 hereof or any
rights or remedies of the Port Authority under this Lease or otherwise.
(6) The Lessee shall promptly supply to the Port Authority such
supporting documents, agreements, contracts and records as the Port Authority
shall deem necessary to substantiate the matters set forth in the Initial Post
Construction Baseline Certificate.
(7) No amount paid by the Port Authority to the Lessee pursuant
to this paragraph (m) shall be deemed final until the Lessee's Cost of the
Initial Post Construction Baseline has been finally determined by the Port
Authority. Such final determination shall occur only after the Port Authority
has examined and approved the Initial Post Construction Baseline Certificate and
the Lessee's Books and Records covering the Initial Post Construction Baseline
Work. In no event whatsoever shall the cost of any portion of the Lessee's Cost
of the Initial Post Construction Baseline as finally determined and computed in
accordance with the provisions of this Section include any expenses, outlays or
charges whatsoever by or for the account of the Lessee for or in connection with
the performance of any Initial Post Construction Baseline Work unless such work
is actually performed nor the costs of any work which is secured by liens,
mortgages, other encumbrances or conditional bills of sale, it being understood
that the foregoing prohibition on liens, mortgages, other encumbrances and
conditional bills of sale is not meant to apply to equipment which is used to
perform the Initial Post Construction Baseline Work.
(8) In the event that a Port Authority audit completed within
three (3) years after the date that the Lessee shall have delivered a complete
Initial Post Construction Baseline Certificate to the Port Authority meeting all
the requirements set forth in this paragraph (m), shall disclose that the amount
of the Lessee's Cost of the Initial Post Construction Baseline is not the amount
set forth in the Initial Post Construction Baseline Certificate, then the
Lessee's Cost of the Initial Post Construction Baseline shall be recalculated as
determined by the Port Authority audit and in the event that the Lessee's Cost
of the Initial Post Construction Baseline as so recalculated is less than the
amount of the Lessee's Cost of the Initial Post Construction Baseline paid by
the Port Authority to the Lessee, the amount of any excess payment received by
the Lessee on account of the Initial Post Construction Baseline Work resulting
from such recalculation shall be immediately payable by the Lessee to the Port
Authority upon demand and in the event that the Lessee's Cost of the Initial
Post Construction Baseline as so recalculated is
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more than the amount of the Lessee's Cost of the Initial Post Construction
Baseline paid by the Port Authority to the Lessee, the amount of such excess
resulting from such recalculation shall be credited by the Port Authority to the
Lessee's Ground Rental payments under Section 4 hereof.
(9) If the Lessee has included in any portion of the Lessee's
Cost of the Initial Post Construction Baseline any item as having been incurred,
but which in the reasonable opinion of the Port Authority was not so incurred,
or which in the reasonable opinion of the Port Authority if so incurred is not
an item properly chargeable to such element of cost under sound accounting
practice or to the Lessee's Cost of the Initial Post Construction Baseline, or
does not represent an appropriate division of the costs of a particular contract
according to time of performance or delivery and the parties have been unable to
resolve their differences within ninety (90) days after the Port Authority gives
its notice to the Lessee objecting to the same, then such dispute shall be
decided by the Chief Engineer of the Port Authority.
(n) Adjustments to the Existing Condition:
(1) If the Port Authority wishes to revise any Ground Water
Threshold Level or any Soil Threshold Level after any Person performs
remediation on the Premises and such remediation is performed or completed after
the date that the last sample was taken in the performance of the Initial Post
Construction Baseline Work, then the Port Authority, may but shall not be
obligated to, supplement or amend any of the Ground Water Threshold Levels and
Soil Threshold Levels as follows: The Port Authority may but shall not be
obligated to take soil and water samples from such areas, test such samples for
one or more Analyzed Items and set forth any or all of such test results in a
report. If any such report is delivered by the Port Authority to the Lessee,
upon the date of such delivery each such report shall be referred to for
purposes of this Agreement as a "Remediation Completion Report"). The tests
results set forth in each Remediation Completion Report shall supersede and
replace the test results in the existing Post Construction Baseline if such test
results are of samples of Analyzed Items taken from the same well or boring or a
new well or boring which is immediately adjacent to such well or boring and
shall supplement and be in addition to the test results in the existing Post
Construction Baseline if such test results are of samples of Analyzed Items
taken from any other location on the Premises. Further for each Remediation
Completion Report, the Port Authority shall recalculate all of the Ground Water
Threshold Levels and the Soil Water Threshold Levels in each Zone for which test
results are set forth in such Remediation Completion Report. Such recalculation
shall be based upon the Post Construction Baseline as the same has been
supplemented and amended by the test results set forth in such Remediation
Completion Report in accordance with paragraph (j). Such calculations of the new
Ground Water Threshold Levels and Soil Threshold Levels shall be set forth in
such Remediation Completion Report. Further, from and after the delivery of such
Remediation Completion Report to the Lessee the Existing Condition for each such
Zone shall be determined on the basis of such recalculated Ground Water
Threshold Levels and Soil Thresholds Levels.
(2) In the event that any ground water test result of a sample
taken in any Zone as part of the Initial Post Construction Baseline Work shows
the presence of Free Product, the Port Authority may but shall not be obligated
to delineate the extent of such Free
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Product. If the Port Authority wishes that such delineated area become an
Additional Zone, it shall perform Additional Baseline Work for such area and
prepare an Additional Baseline. Upon the delivery of such Additional Baseline
covering such Additional Baseline Work, which baseline report shall contain the
coordinates of such delineated area, such delineated area shall become an
"Additional Zone". Additionally, upon such delivery any portion of such
Additional Zone that was formerly a portion of one or more existing Zones shall
no longer be a portion of such Zone. Each Additional Baseline shall further set
forth the calculation of new Soil Threshold Levels and Ground Water Thresholds
for the Additional Zone and each of the reconfigured Zones. From and after the
delivery of such Additional Baseline Report to the Lessee the Existing Condition
for such Zones shall be determined on the basis of such recalculated Ground
Water Threshold Levels and Soil Threshold Levels.
(o) Protection of ▇▇▇▇▇:
Without limiting the generality of the provisions of Section 10
of the Lease, from and after DBO the Lessee agrees to protect and maintain the
accessibility of all ground monitoring ▇▇▇▇▇ installed as part of the Initial
Post Construction Baseline Work or installed by the Port Authority on the
Premises pursuant to any Environmental Requirement, including without limitation
the Remedial Action Work Plan, and to repair any damage thereto not caused by
the activities of the Port Authority or its designee(s). Upon notice from the
Port Authority, the Lessee shall close all such ▇▇▇▇▇ in accordance with all
Environmental Requirements at its sole cost and expense except for ▇▇▇▇▇
installed by the Port Authority and in addition to the requirements of paragraph
(g) of this Section, provide the Port Authority with all documentation and any
other information required to close out such ▇▇▇▇▇ in accordance with all
Environmental Requirements.
(p) The terms and conditions of this Section are intended to allocate
the obligations and responsibilities between the Lessee and the Port Authority,
and nothing in this Section or elsewhere in this Lease shall, or shall be deemed
to, limit, modify waive or otherwise alter the rights, claims and remedies which
the Port Authority or the Lessee may have against third parties at law, equity
or otherwise.
(q) Notwithstanding any other term or provision of this Agreement, the
Existing Condition shall in no event include and the Condition Exceptions shall
not apply to any Hazardous Substance whose presence in, on or under the Premises
was caused by or resulted from the use and occupancy of the Premises by the
Lessee or by any affiliated company of the Lessee, or the performance of any
work by any of them, or the acts or omissions of the Lessee, its officers,
agents or employees, or the acts or omissions of any affiliated company of the
Lessee or of any sublessees or others who occupied the Premises with the
permission of the Lessee or with the permission of an affiliated company of the
Lessee or their officers, agents or employees or any Hazardous Substance that
was added to or under the Premises on or after the Effective Date and was not
added by the sole acts or omissions of the Port Authority (any for the foregoing
Hazardous Substance is herein referred to as a "Lessee Hazardous Substance"), it
being understood that for the purposes of this paragraph (q) that the act of
reusing and re-depositing soil that is excavated as part of the Construction
Work in compliance with the terms and conditions of Section 2 hereof shall not
be or be deemed to have been caused by or resulted from
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the use and occupancy of the Premises by the Lessee or by any affiliated company
of the Lessee, or the performance of any work by any of them, or the acts or
omissions of the Lessee, its officers, agents or employees, or the acts or
omissions of any affiliated company of the Lessee or of any sublessees or others
who occupied the Premises with the permission of the Lessee or with the
permission of an affiliated company of the Lessee or their officers, agents or
employees.
(r) Notwithstanding any other term or condition of this Agreement, it
is hereby understood and agreed that the Lessee's obligations under this
Agreement for remediation and removal of Hazardous Substances shall not be nor
be deemed to be affected in any way whatsoever if the Existing Condition or any
portion thereof, is or will be remediated or removed by the Lessee in whole or
in part in the fulfillment of any of the Lessee's obligations under this
Agreement, whether due to the fact the Lessee cannot remediate or remove one or
more Hazardous Substances for which it is responsible to remediate or remove
without remediating or removing one or more Hazardous Substances for which it is
not responsible for remediating or removing or due to cost or expedience or for
any other reason or that it is responsible for removing a Hazardous Substance to
a related Ground Water Threshold Level or Soil Threshold Level and it can not do
so without removing a Hazardous Substance to or below its related Ground Water
Threshold Level or Soil Threshold Level, and in no event shall the Port
Authority have any responsibility for such remediation or removal, including
without limitation, any obligation to share in the cost of such remediation or
removal except as set forth in Section 2(g)(12) and Section 87 hereof.
(s) The Port Authority has advised the Lessee that it is the intention
of the Port Authority with respect to the application of pollution prevention
programs, "best management practices plans" and other voluntary programs adopted
and agreements made by the Port Authority with any governmental agencies,
departments, commissions, boards, bureaus or instrumentalities of the United
States, states and political subdivisions thereof constituting Environmental
Requirements that the Port Authority will treat the Lessee in a similar manner
as similarly situated Persons at the Airport.
(t) In addition to and without limiting any other term or condition of
this Lease, including without limitation, Sections 6, 9 and 26 hereof and any
other term or condition of this Section, the Exit Ground Water Threshold Level
for each Analyzed Item within each Zone shall be compared to the Ground Water
Threshold Level for such Analyzed Item within such Zone and if any Exit Ground
Water Threshold Level exceeds the Ground Water Threshold Level for such Analyzed
Item within such Zone, the Lessee shall on or before the cessation of the
letting hereunder or any portion thereof and subject to the provisions of
Section 33 hereof, remediate such Analyzed Item within such Zone to the Ground
Water Threshold Level for such Analyzed Item, and the Exit Soil Threshold Level
for each Analyzed Item within each Zone shall be compared to the Soil Threshold
Level for such Analyzed Item within such Zone and if any Exit Soil Threshold
Level exceeds the Soil Threshold Level for such Analyzed Item within such Zone,
the Lessee shall on or before the cessation of the letting hereunder or any
portion thereof and subject to the provisions of Section 33 hereof, remediate
such Analyzed Item within such Zone to the Soil Threshold Level for such
Analyzed Item.
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(u) Without limiting any other term or provision hereof, all the
obligations of the Lessee under this Section shall survive the expiration or
termination of the letting of the Premises or any portion thereof, provided,
however, the obligations of the Lessee under this Section in connection with or
arising out of Hazardous Substances that were not caused by a Lessee's Act shall
expire and terminate on the tenth (10th) anniversary of such termination or
expiration except that that the foregoing shall not release the Lessee from any
obligations or liabilities which may independently arise or accrue at law or in
equity, provided, further, however, the Lessee shall not be responsible for any
Hazardous Substances in, on, under or about the Premises which the Lessee can
prove occurred after the date that the Lessee shall have surrendered the
Premises to the Port Authority and were not due to a Lessee's Act.
(v) (1) Performance of the Exit Baseline by the Lessee:
Unless the Port Authority shall have notified the Lessee
that it has elected to perform the Exit Baseline as provided for in subparagraph
(v)(2) of this paragraph, subject to the terms and provisions of Section 33
hereof entitled "Other Construction by the Lessee" the Lessee shall perform the
Exit Baseline between the eight month and sixth month immediately preceding the
expiration of the letting hereunder or, in the case of an earlier termination of
the letting hereunder, within three months after the effective date of such
termination. The Lessee shall deliver the Exit Baseline to the Port Authority
within ninety (90) days after the completion of the Exit Baseline by the Lessee.
(2) Right of Port Authority to Perform the Exit Baseline:
The Port Authority shall have the right to elect to perform
the Exit Baseline upon notice given to the Lessee on the later to occur of (x)
nine (9) months prior to the expiration date of the term of the letting
hereunder or (y) on or prior to the termination of such letting. In the event
such notice shall be given to the Lessee, the Port Authority shall perform the
Exit Baseline in accordance with the terms and conditions set forth in this
paragraph (v). Such Exit Baseline shall be performed by the Port Authority
within six (6) months after the earlier to occur of the expiration or
termination of the Lease. The Port Authority shall deliver the Exit Baseline to
the Lessee within ninety (90) days after the completion of the Exit Baseline by
the Port Authority.
(3) Payment for the Cost of the Exit Baseline:
If the Port Authority shall not have elected to perform the
Exit Baseline and the Lessee shall have performed the Exit Baseline, the
Lessee's Cost of the Exit Baseline shall be shared equally between the Port
Authority and the Lessee. Accordingly, the Port Authority shall pay to the
Lessee an amount equal to 50% of the Lessee's Cost of the Exit Baseline within
ninety (90) days after the date that the Lessee shall have delivered to the Port
Authority the Exit Baseline Certificate. If the Port Authority shall have
performed the Exit Baseline, the Port Authority's Cost of the Exit Baseline
shall be shared equally between the Port Authority and the Lessee. Accordingly,
the Lessee shall pay to the Port Authority fifty percent (50%) of the Port
Authority's Cost of the Exit Baseline after demand therefor by the Port
Authority.
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(4) Exit Baseline Certificate:
If the Port Authority shall not have elected to perform the
Exit Baseline and the Lessee shall have performed the Exit Baseline, the Lessee
shall deliver to the Port Authority within ninety (90) days after the Lessee
shall have completed the Exit Baseline a notarized certificate of the Lessee
covering the Lessee's Cost of the Exit Baseline meeting all the requirements set
forth in this paragraph (v) (such certificate meeting all of the requirements of
this paragraph (v)(4) and which is delivered to the Port Authority on or before
ninety (90) days after the Lessee shall have completed the Exit Baseline is
hereinafter referred to as the "Exit Baseline Certificate"), which certificate
shall be signed by a responsible fiscal officer of the Lessee and notarized and
further shall:
(i) set forth, in reasonable detail, the amounts paid to
specified independent third party contractors and the amounts of payments made
to other specified Persons for the Lessee's Cost of the Exit Baseline and
certify that such amounts constitute portions of the Lessee's Cost of the Exit
Baseline;
(ii) have attached thereto reproduction copies or duplicate
originals of the invoices of such independent third party contractors and other
Persons and an acknowledgment by such independent contractors and other Persons
of the receipt by them of such amounts and payments;
(iv) certify that the amounts and payments therein set forth
constitute all or a portion of the Exit Baseline; that the Exit Baseline covered
by the certificate has been accomplished and that it has been performed in
accordance with all the terms and provisions of this Lease; and
(v) certify there is no outstanding indebtedness known to
the Lessee, after due and diligent inquiry, then due on account of the Exit
Baseline which, if unpaid, might become the basis of a vendor's, mechanic's,
laborer's or materialmen statutory or other lien or alleged lien upon the
Premises or any part thereof, or upon the Lessee's leasehold interest therein,
provided that the foregoing shall not limit or impair Section 20 hereof or any
rights or remedies of the Port Authority under this Lease or otherwise.
(5) Nothing contained herein shall be deemed or construed as a
submission by the Port Authority to the application to itself of any lien
described in this paragraph (v) or to limit or impair Section 20 hereof or any
rights or remedies of the Port Authority under this Lease or otherwise.
(6) The Lessee shall promptly supply to the Port Authority such
supporting documents, agreements, contracts and records as the Port Authority
shall deem necessary to substantiate the matters set forth in the Exit Baseline
Certificate.
(7) No amount paid by the Port Authority to the Lessee pursuant
to this paragraph (v) shall be deemed final until the Lessee's Cost of the Exit
Baseline has been
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finally determined by the Port Authority. Such final determination shall occur
only after the Port Authority has examined and approved the Exit Baseline
Certificate and the Lessee's Books and Records covering the Exit Baseline. In no
event whatsoever shall the cost of any portion of the Lessee's Cost of the Exit
Baseline as finally determined and computed in accordance with the provisions of
this Section include any expenses, outlays or charges whatsoever by or for the
account of the Lessee for or in connection with the performance of any Exit
Baseline unless such work is actually performed nor the costs of any work which
is secured by liens, mortgages, other encumbrances or conditional bills of sale,
it being understood that the foregoing prohibition on liens, mortgages, other
encumbrances and conditional bills of sale is not meant to apply to equipment
which is used to perform the Exit Baseline.
(8) In the event that a Port Authority audit completed within
three (3) years after the date that the Lessee shall have delivered a complete
Exit Baseline Certificate to the Port Authority meeting all the requirements set
forth in this paragraph (v), shall disclose that the amount of the Lessee's Cost
of the Exit Baseline is not the amount set forth in the Exit Baseline
Certificate, then the Lessee's Cost of the Exit Baseline shall be recalculated
as determined by the Port Authority audit and in the event that the Lessee's
Cost of the Exit Baseline as so recalculated is less than the amount of the
Lessee's Cost of the Exit Baseline paid by the Port Authority to the Lessee, the
amount of any excess payment received by the Lessee on account of the Exit
Baseline resulting from such recalculation shall be immediately payable by the
Lessee to the Port Authority upon demand and in the event that the Lessee's Cost
of the Exit Baseline as so recalculated is more than the amount of the Lessee's
Cost of the Exit Baseline paid by the Port Authority to the Lessee, the amount
of such excess resulting from such recalculation shall at the election of the
Port Authority be credited against amounts owed by the Lessee to the Port
Authority or the Port Authority shall pay such excess to the Lessee.
(9) If the Lessee has included in any portion of the Lessee's
Cost of the Exit Baseline any item as having been incurred, but which in the
reasonable opinion of the Port Authority was not so incurred, or which in the
reasonable opinion of the Port Authority if so incurred is not an item properly
chargeable to such element of cost under sound accounting practice or to the
Lessee's Cost of the Exit Baseline, or does not represent an appropriate
division of the costs of a particular contract according to time of performance
or delivery and the parties have been unable to resolve their differences within
ninety (90) days after the Port Authority gives its notice to the Lessee
objecting to the same, then such dispute shall be decided by the Chief Engineer
of the Port Authority.
(10) It is hereby understood and agreed that the Exit Baseline
and the test results therefrom may be used by the Lessee to evidence that a
Hazardous Substance in, on or under the Premises occurred after the date that
the Lessee shall have surrendered the Premises to the Port Authority and that
the Exit Baseline and the test results therefrom may be used by the Port
Authority to evidence that a Hazardous Substance in, on or under the Premises
occurred on or prior to the date that the Lessee shall have surrendered the
Premises to the Port Authority.
(11) The methodology to be used to determine the Exit Ground
Water Threshold Level for all Analyzed Items within each Zone and to determine
the Exit Soil Threshold Level for all Analyzed Items within each Zone shall be
as follows:
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(i) Only the ground water and soil test results set forth in
the Exit Baseline Report shall be used to calculate the Exit Ground Water
Threshold Levels and the Exit Soil Threshold Levels.
(ii) Analyzed Items not detected for a given ground water
sample shall be assigned a concentration equal to half of the ground water
detection limit for such Analyzed Item and Analyzed Items not detected for a
given soil sample shall be assigned a concentration equal to half of the soil
detection limit for such Analyzed Item.
(iii) The maximum concentration of each Analyzed Item in the
ground water samples taken from a location shall be used to represent the
concentration of that Analyzed Item in the ground water at that location and the
maximum concentration of each Analyzed Item in the soil samples taken from a
location shall be used to represent the concentration of that Analyzed Item in
the soil at that location.
(iv) The mean concentration of an Analyzed Item in the
ground water (i.e. the "WM") shall be calculated for each Zone using the
following equation: WM = (X1 + X2 + .....+ Xn) / n; where "X" shall equal the
maximum concentration of an Analyzed Item in the ground water at one sample
location and "n" shall equal the number of ground water sample locations in such
Zone.
(v) The mean concentration of an Analyzed Item in the soil
(i.e. the "SM") shall be calculated for each Zone using the following equation:
SM = (Y1 + Y2 + .....+ Yn) / n; where "Y" shall equal the maximum concentration
of an Analyzed Item in the soil at one sample location and "n" shall equal the
number of soil sample locations in such Zone.
(vi) The standard deviation for each Analyzed Item in the
ground water shall be calculated for each Zone using the following equation:
(2) (2) (2)
Ground Water SD = {[( X1 - WM) + ( X2 - WM) +...+ ( Xn - WM) ]/( n
(1/2)
-1 )} .
(vii) The standard deviation for each Analyzed Item in the
soil shall be calculated for each Zone using the following equation:
(2) (2) (2) (1/2)
Soil SD={[( Y1 - SM) + ( Y2 - SM) +...+ ( Yn - SM) ]/( n -1 )}.
(viii) An exit ground water threshold level for each
Analyzed Item shall be calculated for each Zone using the following equation:
Exit Ground Water Threshold = (WM + Ground Water SD). The exit ground water
threshold levels as so calculated for each Analyzed Item in the soil of a Zone
is herein called an "Exit Ground Water Threshold Level".
(ix) An exit soil threshold level for each Analyzed Item
shall be calculated for each Zone using the following equation: Exit Soil
Threshold = (SM + Soil SD). The exit ground water threshold level as so
calculated for each Analyzed Item in the soil of a Zone is herein called an
"Exit Soil Threshold Level".
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(w) In the event of the termination or surrender of a portion of the
Premises then all of the terms and conditions of paragraphs (u) and (v) shall
apply to such termination or surrender.
(x) Exhibit 56.4 may be used by either party to establish the presence
or non-presence of any Hazardous Substance on the Premises prior to, on or after
the Effective Date.
SECTION 57. LATE CHARGES
If the Lessee should fail to pay any amount required to be paid by the
Lessee under this Agreement when due to the Port Authority, including without
limitation any payment of rental or any payment of utility or other charges or
if any such amount is found to be due as the result of an audit, then, in such
event, the Port Authority may impose (by statement, bill or otherwise) a late
charge with respect to each such unpaid amount for each late charge period
(hereinbelow described) during the entirety of which such amount remains unpaid,
each such late charge not to exceed an amount equal to eight tenths of one
percent of such unpaid amount for each late charge period. There shall be
twenty-four late charge periods on a calendar year basis; each late charge
period shall be for a period of at least fifteen (15) calendar days except one
late charge period each calendar year may be for a period of less than fifteen
(but not less than thirteen) calendar days. Without limiting the generality of
the foregoing, late charge periods in the case of amounts found to have been
owing to the Port Authority as the result of Port Authority audit findings shall
consist of each late charge period following the date the unpaid amount should
have been paid under this Agreement. Each late charge shall be payable
immediately upon demand made at any time therefor by the Port Authority. No
acceptance by the Port Authority of payment of any unpaid amount or of any
unpaid late charge amount shall be deemed a waiver of the right of the Port
Authority of payment of any late charge or late charges payable under the
provisions of this Section with respect to such unpaid amount. Each late charge
shall be and become additional rent, recoverable by the Port Authority in the
same manner and with like remedies as if it were originally a part of the
rental. Nothing in this Section is intended to, or shall be deemed to, affect,
alter, modify or diminish in any way (i) any rights of the Port Authority under
this Agreement, including without limitation the Port Authority's rights set
forth in Section 20 hereof entitled "Termination by the Port Authority" or (ii)
any obligations of the Lessee under this Agreement. In the event that any late
charge imposed pursuant to this Section shall exceed a legal maximum applicable
to such late charge, then in such event such charge payable under this Agreement
shall be payable instead at such legal maximum.
SECTION 58. AIRPORT TRANSPORTATION FACILITIES AND OPERATIONS USE OF PORTIONS OF
THE PREMISES
(a) The Lessee understands that the Port Authority has constructed
certain ground transportation facilities at the Airport including, but not
limited to, a light rail passenger distribution system ("AirTrain"). The Lessee
acknowledges and agrees that the AirTrain is intended to be a benefit and
enhancement to the Airport and to the Lessee's operations thereon.
(b) (1) The Lessee understands that the construction and operation of
the AirTrain may require the location on the terminal of a passenger station
(including pedestrian access between it and the passenger terminal building)
and, in addition, requires the use of a
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portion or portions of the Premises for and in connection with the construction,
maintenance or operation of other portions of the AirTrain. The Lessee agrees
that it shall make available to the Port Authority upon demand such use for or
in connection with the construction, maintenance and operation of the AirTrain
for such purposes as may be required or be appropriate therefor and, where such
portion of the AirTrain exclusively serves the Premises, the same shall be made
available by the Lessee without abatement of rental or charges hereunder or any
payments by the Port Authority to the Lessee therefor. Where such portion of the
AirTrain does not exclusively serve the Premises then the rental hereunder shall
be abated in accordance with the rental abatement provisions of this Lease.
(2) Without limiting the terms and provisions of paragraph (b)(1)
above, the Lessee shall comply with the provisions of Section 2 hereof entitled
"Construction by the Lessee" with respect to the coordination of the AirTrain
with the Construction Work as set forth in said Section 2.
(c) The Lessee understands that the Port Authority considers the
construction, operation and maintenance of the AirTrain of the utmost importance
to the efficient operation of the Airport and to the fulfillment of the Port
Authority's governmental function to provide, maintain, develop and operate the
Airport; that the efficient use and operation of the AirTrain will require that
the Lessee in the operation and use of its passenger terminal facilities under
this Lease shall utilize and cooperate in the operation of the AirTrain to the
end that the AirTrain shall be utilized to the fullest extent possible so that
its advantages and efficiencies can be fully realized; and that the Port
Authority does not by this Lease intend to enter into any agreement,
understanding or commitment which will interfere with, limit, restrict, hinder
or prevent in any way the development, construction, maintenance, operation or
efficient use of the AirTrain.
(d) The Lessee also understands and acknowledges that the cost of
planning, design, construction, maintenance and operation of the AirTrain will
be accorded the same cost recovery treatment as the similar elements of the Air
Terminal Highway is accorded in the JFK Flight Fees Agreements for calculation
of the flight fees under the JFK Flight Fees Agreements and the same cost
recovery treatment as the Air Terminal Highway is accorded for the calculation
of other fees and charges under other existing agreements and policies at the
Airport, and under any agreements which may be entered into in the future
including agreements to replace such existing agreement(s) or the JFK Flight
Fees Agreements.
(e) The Port Authority has also advised the Lessee that it is the
intention of the Port Authority that with respect to the maintenance, operation,
use and payment for the AirTrain all Aircraft Operators at the Airport which are
similarly situated will be treated in a similar manner including the treatment
of the cost, if any, of each in connecting its airport terminal facility to the
AirTrain.
(f) Without limiting any other provisions of this Section the Lessee
understands and agrees that changes and modifications to certain provisions of
the Lease including, but not limited to, Section 45 hereof entitled "Ingress and
Egress", and Section 68 hereof entitled "Ground Transportation Within the
Central Terminal Area" and Section 46 hereof entitled "Restrictions on Use of
Passenger Terminal Frontage Roadways - Use of Airport Taxi
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Dispatchers and Roadway Frontage Management", may be required or appropriate to
conform the provisions of these Sections to the operation of the AirTrain and
the Lessee agrees that upon the presentation to it of a form of supplemental
agreement to this Lease which includes such modifications it will execute and
return the same to the Port Authority. The Port Authority and the Lessee agree
that each will consult with the other, from time to time, and will provide
information to the other, from time to time, with respect to the study,
planning, design, construction, maintenance and operation of the AirTrain and
its interconnection with the Lessee's passenger terminal facilities at the
Premises.
SECTION 59. CLUB ROOMS
In the event the Lessee provides any rooms or space for the special
handling of or the furnishing of special services to any of its passengers,
guests or invitees it shall furnish such rooms or space at its expense and
without cost to the Port Authority. The Lessee agrees that any food, alcoholic
or non-alcoholic beverages and similar items sold or furnished to the Lessee's
passengers, guests or invitees shall be obtained by the Lessee from a Restaurant
Operator who has been authorized by the Port Authority to operate establishments
for the sale of food, alcoholic and non-alcoholic beverages and similar items
for consumption in passenger terminal facilities at the Airport. All monies paid
or payable to a Restaurant Operator for such sales shall be included in the
Gross Receipts of such Restaurant Operator. In the event the Lessee wishes to
use its own personnel for serving food, alcoholic or non-alcoholic beverages and
similar items it may do so; provided that the food, alcoholic and non-alcoholic
beverages are obtained by the Lessee from a Person who has been issued a permit
by the Port Authority granting such Person permission to provide such food and
beverages and provided that monies paid therefor, in that event, shall not be
included in the Gross Receipts of such Person. If the Lessee uses its own
personnel for serving food, alcoholic or non-alcoholic beverages and similar
items, the Lessee will not be obligated to pay a fee to the Port Authority which
would be greater than the fee that would be retained by the Port Authority if
the food, alcoholic or non-alcoholic beverages and similar items were served by
a Restaurant Operator.
SECTION 60. LESSEE'S SERVICE STANDARDS
Subject to and without limiting or affecting any other term or
provision of the Lease, the Lessee agrees to provide services at the Premises
for the benefit of the traveling public in a manner consistent with generally
accepted airline industry standards for airport terminals, and to use good faith
efforts to comply with the existing Port Authority Airport Standards Manuals
(copies available from the Aviation Department) in effect at the time, and such
reasonable future airport standards (including amendments or supplements) as the
Port Authority may from time to time promulgate in the public interest and in
the interest of health, safety, noise, sanitation, good order and customer
service and statisfaction. The Lessee agrees to cooperate with the Port
Authority and other airlines serving the traveling public at the Airport in
maintaining these standards through organized airport service improvement
working groups.
SECTION 61. STORAGE TANKS
(a) (1) The Lessee shall not use any of the underground or above
ground storage tanks installed in the Premises as of the Lease Commencement Date
and its or their
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appurtenances, pipes, lines, fixtures and other related equipment (which tanks
and appurtenances, pipes, lines, fixtures and equipment are hereinafter
collectively called the "Existing Tanks" and singularly called an "Existing
Tank"). In the event that notwithstanding the foregoing the Lessee shall use any
of the Existing Tanks, then such use shall be subject to all of the terms and
conditions of this Section. For the purpose of the foregoing, "use" shall not
include the removal or abandonment of any Tanks performed as part of the
Redevelopment Work.
(2) Each Existing Tank used by the Lessee and all underground
storage tanks and all above ground storage tanks installed in the Premises
during the term of the letting hereunder or during the letting or use of the
Premises by the Lessee under any previous agreement, and its or their
appurtenances, pipes, lines, fixtures and other related equipment are
hereinafter collectively called the "Lessee's Tanks" and singularly called a
"Lessee Tank". Notwithstanding any other facts or circumstances to the contrary
including without limitation any vesting of title to the Lessee's Tanks in the
City of New York pursuant to any construction or alteration application or
otherwise, the Lessee hereby agrees that title and ownership of the Lessee's
Tanks shall be and remain in the Lessee, that all Lessee's Tanks shall be
registered by the Lessee in the name of the Lessee as operator and owner and
that the Lessee shall have full and sole responsibility for all the Lessee's
Tanks, and shall release and relieve the Port Authority from all costs and
responsibility for the Lessee's Tanks. The Port Authority has made no
representations or warranties with respect to the Lessee's Tanks or their
location and shall assume no responsibility for the Lessee's Tanks. All Lessee's
Tanks installed by the Lessee shall be installed pursuant to the terms and
conditions of the Lease including without limitation Section 33 hereof entitled
"Other Construction by the Lessee" and nothing in this Section shall or shall be
deemed to be permission or authorization to install any Lessee's Tanks.
(b) Without limiting the generality of any of the provisions of the
Lease, the Lessee agrees that it shall be solely responsible for maintaining,
testing and repairing the Lessee's Tanks. The Lessee shall not perform any
servicing, repair or non-routine maintenance to the Lessee's Tanks without the
prior written approval of the Port Authority. In addition, the Lessee, at its
sole cost and expense, shall make all modifications to the Lessee's Tanks and
take all other actions so that the Lessee's Tanks shall at all times comply with
all applicable Environmental Requirements.
(c) (1) The Lessee shall remove all the Lessee's Tanks from the
Premises on or before the expiration of the Lease (unless the Lessee shall have
received the prior written approval of the Port Authority to have abandoned a
tank in place and such abandonment continues to meet all applicable
Environmental Requirements) and the Lessee agrees to dispose of the Lessee's
Tanks off the Airport in accordance with all applicable Environmental
Requirements.
(2) Any removal of the Lessee's Tanks shall be performed pursuant
to an alteration application prepared by the Lessee and submitted to the Port
Authority for the Port Authority's approval and in connection with such removal,
the Lessee shall restore the Premises to the same condition existing prior to
the installation of the Lessee's Tanks, shall perform such testing of the
Lessee's Tanks and of the soil, sub-soil and ground water in the vicinity of the
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Lessee's Tanks as shall be required by the Port Authority and shall clean-up and
remediate any Discharge disclosed by said testing. In the event the Lessee does
not remove the Lessee's Tanks as required by subparagraph (l) above, the Port
Authority may enter upon the Premises and effect the removal and disposal of the
Lessee's Tanks, restoration of the Premises and such remediation and the Lessee
hereby agrees to pay all costs and expenses of the Port Authority arising out of
such removal, disposal, restoration and remediation.
(d) Without limiting the generality of any other term or provision of
the Lease, the Lessee shall at its cost and expense comply with all
Environmental Requirements applicable to the Lessee's Tanks, including without
limitation any modifications or closures required thereby, and any Discharge (as
defined in paragraph (i) hereof) including without limitation testing the
Lessee's Tanks and registering the Lessee's Tanks in the name of the Lessee as
owner and operator, submitting all required clean-up plans, bonds and other
financial assurances, performing all required clean-up and remediation of
Discharges and filing all reports, making all submissions to, providing all
information required by, and complying with all requirements of, all
Governmental Authorities pursuant to all such Environmental Requirements.
Nothing in the foregoing shall be construed as a submission by the Port
Authority to the application to itself of the Environmental Requirements,
provided, however, no immunity or exemption of the Port Authority from the
Environmental Requirements shall excuse the compliance therewith by the Lessee
or shall be grounds for non-compliance therewith by the Lessee.
(e) (1) Without limiting the terms and provisions of Section 2 hereof
entitled "Construction by the Lessee" and Section 13 hereof entitled "Indemnity
and Liability Insurance", the Lessee hereby assumes all risks arising out of or
in connection with the Lessee's Tanks and all Discharges whether or not foreseen
or unforeseen and shall indemnify and hold harmless the Port Authority, its
Commissioners, officers, agents and employees from and against (and shall
reimburse the Port Authority for their costs and expenses including without
limitation penalties, fines, liabilities, settlements, damages, attorney and
consultant fees, investigation and laboratory fees, clean-up and remediation
costs, court costs and litigation expenses), all claims and demands, just or
unjust, of third persons (such claims and demands being hereinafter in this
Section referred to as "Claims" and singularly referred to as a "Claim")
including but not limited to those for personal injuries (including death),
property damages, or environmental impairment, arising or alleged to arise out
of or in any way related to, the failure of the Lessee to comply with each and
every term and provision of the Lease relating to the Lessee's Tanks or to any
Discharge, or the Lessee's Tanks, or any Discharge, or any lawsuit brought or
threatened, settlement reached or any governmental order relating to the
Lessee's Tanks or a Discharge, or any violation of any Environmental Requirement
or demands of any Governmental Authority based upon or in any way related to the
Lessee's Tanks or a Discharge, and whether such arise out of the acts or
omissions of the Lessee or of the contractors of the Lessee or of third persons
or out of the acts of God or the public enemy or otherwise including Claims by
the City of New York against the Port Authority pursuant to the provisions of
the Basic Lease whereby the Port Authority has agreed to indemnify the City
against claims. It is understood the foregoing indemnity shall cover all claims,
demands, penalties, settlements, damages, fines, costs and expenses of or
imposed by any Governmental Authority under the aforesaid Environmental
Requirements.
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(2) If so directed the Lessee shall at its expense defend any
suit based upon any such Claim (even if such Claim is groundless, false or
fraudulent) and in handling such it shall not without first having express
advance permission from the General Counsel of the Port Authority raise any
defense involving in any way the jurisdiction of the tribunal over the person of
the Port Authority, the immunity of the Port Authority, its Commissioners,
officers, agents or employees, the governmental nature of the Port Authority or
the provisions of any statutes respecting suits against the Port Authority.
(3) The terms and conditions of this paragraph (e) are intended
to allocate obligations and responsibilities between the Lessee and the Port
Authority only, and nothing in this paragraph (e) shall limit, modify or
otherwise alter the rights and remedies which the Port Authority or the Lessee
may have against third parties at law, equity or otherwise.
(f) Without limiting or affecting the terms and provisions of Section
23 hereof entitled "Survival of the Obligations of the Lessee", the Lessee's
obligations under this Section shall survive the expiration or earlier
termination of the Lease as provided in Section 56 hereof.
(g) In addition to the requirements of Section 6 hereof entitled
"Compliance with Governmental Regulations" and paragraph (d) of this Section,
the Port Authority shall have the right upon notice to the Lessee to direct the
Lessee, at the Lessee's sole cost and expense, (i) to perform such reasonable
testing of the Lessee's Tanks as the Port Authority shall direct and to perform
such testing of the soil, subsoil and ground water of the Premises and of such
surrounding area as the Port Authority shall direct, and (ii) to clean-up and
remediate any Discharge, regardless of whether any Environmental Requirement or
Governmental Authority shall require such testing, clean-up or remediation,
which testing, clean-up and remediation shall be performed pursuant to an
alteration application prepared by the Lessee and submitted to the Port
Authority for the Port Authority's approval.
(h) In the Lessee's use and operation of the Lessee's Tanks, the
Lessee shall not permit any Hazardous Substance from entering the ground
including without limitation (subject to Section 33 hereof entitled "Other
Construction by the Lessee") by the Lessee installing appropriate spill and
overfill devices and placing an impervious material, such as asphalt or
concrete, over the ground area above or under, as the case shall be, and in the
vicinity of the Lessee's Tanks.
(i) As used in this Section, "Discharge" shall mean the presence,
pumping, pouring, venting, emitting, emptying, leakage, deposit, spill,
discharge or other release of Hazardous Substances from the Lessee's Tanks or in
connection with their use, operation, maintenance, testing or repair.
SECTION 62. NON-DISCRIMINATION
(a) Without limiting the generality of any of the provisions of this
Agreement, the Lessee, for itself, its successors in interest, and assigns, as a
part of the consideration hereof, does hereby covenant and agree as a covenant
running with the land that (1) no person on the
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ground of race, creed, color, sex or national origin shall be excluded from
participation in, denied the benefits of, or be otherwise subjected to
discrimination in the use of the Premises, (2) that in the construction of any
improvements on, over, or under the Premises and furnishing of services thereon,
no person on the ground of race, creed, color, sex or national origin shall be
excluded from participation in, denied the benefits of, or otherwise be subject
to discrimination, (3) that the Lessee shall use the Premises 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,
Part 21, Non-discrimination in Federally-assisted programs of the Department of
Transportation-Effectuation of Title VI of the Civil Rights Act of 1964, and as
said Regulations may be amended, and any other present or future laws, rules,
regulations, orders or directions of the United States of America with respect
thereto which from time to time may be applicable to the Lessee's operations at
the Airport, whether by reason of agreement between the Port Authority and the
United States Government or otherwise.
(b) The Lessee shall include the provisions of paragraph (a) of this
Section in every sublease, agreement or concession it may make pursuant to which
any Person or Persons, other than the Lessee, operates any facility at the
Airport providing services to the public and shall also include therein a
provision granting the Port Authority a right to take such action as the United
States may direct to enforce such covenant.
(c) The Lessee's noncompliance with the provisions of this Section
shall constitute a material breach of this Agreement. In the event of the breach
by the Lessee of any of the above nondiscrimination provisions the Port
Authority may take appropriate action to enforce compliance; or in the event
such noncompliance shall continue for a period of twenty (20) days after receipt
of written notice from the Port Authority, the Port Authority shall have the
right to terminate this Agreement and the letting hereunder with the same force
and effect as a termination under Section 20 hereof entitled "Termination by the
Port Authority", or may pursue such other remedies as may be provided by law;
and as to any or all the foregoing, the Port Authority may take such action as
the United States may direct.
(d) The Lessee shall indemnify and hold harmless the Port Authority
from any claims and demands of third persons, including the United States of
America resulting from the Lessee's noncompliance with any of the provisions of
this Section and the Lessee shall reimburse the Port Authority for any loss or
expense incurred by reason of such noncompliance.
(e) Nothing contained in this Section shall grant or shall be deemed
to grant to the Lessee the right to transfer or assign this Agreement, to make
any agreement or concession of the type mentioned in paragraph (b) hereof, or
any right to perform any construction on the Premises.
SECTION 63. AFFIRMATIVE ACTION
The Lessee assures that it will undertake an affirmative action
program as required by 14 CFR Part 152, Subpart E, to insure that no person
shall on the grounds of race, creed, color, national origin, or sex be excluded
from participating in any employment activities covered in 14 CFR Part 152,
Subpart E. The Lessee assures that no person shall be excluded on these grounds
from participating in or receiving the services or benefits of any program or
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activity covered by this subpart. The Lessee assures that it will require that
its covered suborganizations provide assurances to the Lessee that they
similarly will undertake affirmative action programs and that they will require
assurances from their suborganizations, as required by 14 CFR Part 152, Subpart
E, to the same effect.
SECTION 64. THE LESSEE'S ONGOING AFFIRMATIVE ACTION, EQUAL OPPORTUNITY ANDLOCAL
BUSINESS ENTERPRISES COMMITMENT
I. The Lessee's Ongoing Affirmative Action and Equal Opportunity
Commitment
(a) In addition to and without limiting any other term or provision of
this Agreement, the Lessee shall not discriminate against employees or
applicants for employment because of race, creed, color, national origin, sex,
age, disability or marital status and shall undertake or continue existing
programs of affirmative action to ensure that minority group persons and women
are afforded equal employment opportunity without discrimination in connection
with the operation, repair and maintenance of the Premises by the Lessee. Such
programs shall include, but not be limited to, recruitment, employment, job
assignment, promotion, upgrading, demotion, transfer, layoff, termination, rates
of pay or other forms of compensation, and selections for training or
retraining, including apprenticeship and on-the-job training.
(b) In addition to and without limiting the foregoing, and without
limiting the provisions of Section 62 hereof entitled "Non-Discrimination" and
Schedule E, it is hereby agreed that the Lessee in connection with its
continuing operation, maintenance and repair of the Premises, or any portion
thereof, and in connection with every award or agreement for concessions or
consumer services at the Airport, shall throughout the term of the letting
hereunder commit itself to and use good faith efforts to implement an extensive
program of affirmative action, including specific affirmative action steps to be
taken by the Lessee, to ensure maximum opportunities for employment and
contracting by minorities and women, and by Minority Business Enterprises
("MBE") and Women-owned Business Enterprises ("WBE"). In meeting the said
commitment the Lessee agrees to submit to the Port Authority for its review and
approval its said extensive affirmative action program, including the specific
affirmative action steps to be taken by the Lessee to meet its aforesaid
commitment, within sixty (60) days after the Lease Commencement Date. The Lessee
shall incorporate in its said affirmative action program such revisions and
changes which the Port Authority initially or from time to time may reasonably
require. The Lessee throughout the term of the Lease shall document its efforts
in implementing the said program, shall keep the Port Authority fully advised of
the Lessee's progress in implementing the said affirmative action program and
shall supply to the Port Authority such information, data and documentation with
respect thereto as the Port Authority may from time to time and at any time
reasonably request, including but not limited to annual reports.
(c) Good faith efforts to include meaningful participation by MBEs and
WBEs shall include at least the following:
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(1) Dividing the work to be subcontracted into smaller portions
where feasible.
(2) Actively and affirmatively soliciting bids for subcontracts
from MBEs and WBEs, including circulation of solicitations to minority and
female contractor associations. The Lessee shall maintain records detailing the
efforts made to provide for meaningful MBE and WBE participation as called for
in paragraph (b) above, including the names and addresses of all MBEs and WBEs
contacted and, if any such MBE or WBE is not selected as a joint venturer or
subcontractor, the reason for such decision.
(3) Making plans and specifications for prospective work
available to MBEs and WBEs in sufficient time for review.
(4) Utilizing the list of eligible MBEs and WBEs maintained by
the Port Authority or seeking minorities and women from other sources for the
purpose of soliciting bids for subcontractors.
(5) Encouraging the formation of joint ventures, partnerships or
other similar arrangements among subcontractors, where appropriate, to insure
that the Lessee will meet its obligations hereunder.
(6) Insuring that provisions are made to provide progress
payments to MBEs and WBEs on a timely basis, preferably biweekly, and that
retainage it paid to MBEs and WBEs when they have completed their work.
(7) Submitting quarterly reports to the Port Authority Office of
Business and Job Opportunity detailing its compliance with the provisions
hereof.
(8) Requiring each contractor to submit to the Lessee with each
payment request evidence that all MBE and WBE contractors have been paid in
accordance with their contract.
(d) The Lessee's non-compliance with the provisions of this Section
shall constitute a material breach of this Agreement. In the event of the breach
by the Lessee of any of the above provisions the Port Authority may take any
appropriate action to enforce compliance; or in the event such non-compliance
shall continue for a period of twenty (20) days after receipt of written notice
from the Port Authority, the Port Authority shall have the right to terminate
this Agreement and the letting hereunder with the same force and effect as a
termination for default by the Lessee in the performance or observance of any
other term or provision of this Agreement, or may pursue such other remedies as
may be provided by law.
(e) In the implementation of this Section, the Port Authority may
consider compliance by the Lessee with the provisions of any federal, state or
local law concerning affirmative action equal employment opportunity which are
at least equal to the requirements of this Section, as effectuating the
provisions of this Section. If the Port Authority determines that by virtue of
such compliance with the provisions of any such federal, state or local law that
the
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provisions hereof duplicate or conflict with such law the Port Authority may
waive the applicability of the provisions of this Section to the extent that
such duplication or conflict exists.
(f) Nothing herein provided shall be construed as a limitation upon
the application of any laws which establish different standards of compliance or
upon the application of requirements for the hiring of local or other area
residents.
(g) Nothing in this Section shall grant or be deemed to grant the
Lessee the right to make any agreement or award for concessions or consumer
services at the Airport.
II. The Lessee's Local Business Enterprise Commitment
The Lessee in connection with any construction work on the Premises,
or any portion thereof, shall throughout the term of the letting hereunder
commit itself to and use good faith efforts to implement an extensive program to
utilize Local Business Enterprises in accordance with and as set forth in
Schedule F.
SECTION 65. BOOKS AND RECORDS
(a) The Lessee shall maintain, in English and in accordance with
generally accepted accounting principles full and complete records and books of
account for at least seven (7) years or such longer period with respect to
certain record and books of account as required in other terms and provisions of
this Agreement, (unless any such records and books are material to litigation
initiated within that time in which event they shall be maintained until final
determination of the controversy), which records and books shall include without
limitation all agreements and all source documents such as but not limited to
original invoices, invoice listings, timekeeping records, and work schedules and
the records and books that the Lessee is required to keep pursuant to Section 2
hereof entitled "Construction by the Lessee", Section 56 hereof entitled
"Environmental Obligations", Section 73 hereof entitled "Consumer Services" and
Section 87 hereof entitled "Port Authority Payments for the Cost of the
Redevelopment Work", and shall record (i) all matters which the Lessee is
required to certify to the Port Authority pursuant to this Lease, (ii) all
transactions of the Lessee at, through, or in anyway connected with the Airport,
and outside the Airport if the order therefor is received at the Airport, in
connection with all activities conducted by the Lessee or a third person
relating to the Cost of the Redevelopment Work, In-Flight Meals (including
without limitation all payments by the Lessee to its independent contractors
which furnish In-Flight Meals or any portion thereof), services provided to
Handled Airlines, ground transportation, subleasing of the Premises or any other
activity at the Airport or outside the Airport if the order therefor is received
at the Airport and which may require pursuant to the terms of this Lease, any
other agreement between the Lessee and the Port Authority except for the JFK
Flight Fees Agreement or otherwise the payment by the Lessee to the Port
Authority of fees, rentals or other amounts in connection with the conduct
thereof, and (iii) any other matter concerning the Lessee's operations at the
Airport with respect to which the Port Authority may reasonably need information
to fulfill its obligations or exercise its rights under this Lease whether or
not of the type enumerated above and whether or not an express obligation to
keep books and records with regard thereto is expressly set forth elsewhere in
this Lease, which records and books of account shall be kept at all times within
the Port of New York District and shall separately state and identify each of
the
216
foregoing items, matters, transactions and activities, it being understood
and agreed that nothing in this Section shall grant or shall be deemed to have
granted any rights in the Lessee or any third person to conduct any business,
privilege or other activity or transaction at the Airport or off the Airport,
provided, however, on the condition that the Lessee shall comply with all of the
terms and conditions of paragraph (e)(ii) hereof, the Lessee may maintain said
books and records and make them available to the Port Authority at the Lessee's
principal office, which currently is located at ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇.
(b) The Lessee shall cause any Affiliate, if any such Affiliate
performs services similar to those performed by the Lessee, to maintain, in
English and in accordance with accepted accounting practice full and complete
records and books of account for at least seven (7) years (unless such records
and books are material to litigation initiated within that time in which event
they shall be maintained until final determination of the controversy), which
records and books of account shall include without limitation all agreements and
all source documents such as but not limited to original invoices, invoice
listings, timekeeping records, and work schedules and shall record all
transactions of each Affiliate at, through, or in anywise connected with the
Airport, which records and books of account shall be kept at all times within
the Port of New York District and shall separately state and identify each
activity performed at the Airport and off the Airport if the order therefor is
received at the Airport;
(c) The Lessee shall permit and/or cause to be permitted in ordinary
business hours during the term of the letting under this Lease, for one (1) year
thereafter, and during such further period as is mentioned in the preceding
paragraphs (a) and (b), the examination and audit by the officers, employees and
representatives of the Port Authority of all the records and books of account of
the Lessee (including without limitation all corporate records and books of
account which the Port Authority in its sole discretion believes may be relevant
for the identification, determination or calculation of all fees, rentals and
other amounts paid or payable to the Port Authority, all amounts paid or payable
by the Port Authority to the Lessee under this Lease and of all agreements, and
all source documents) and all the records and books of account of all Affiliates
(including without limitation all corporate records and books of account which
the Port Authority in its sole discretion believes may be relevant for the
identification, determination or calculation of all fees, rentals and other
amounts paid or payable to the Port Authority, all agreements, and all source
documents) (all of the foregoing records and books described in this paragraph
(c) being hereinafter collectively referred to as the "Books and Records")
within ten (10) days following any request by the Port Authority from time to
time and at any time to examine and audit any Books and Records; it being
specifically understood that the Port Authority shall not be bound by any prior
audit or examination conducted by it.
(d) The Lessee shall install and use such equipment and devices,
including without limitation computerized record keeping systems, for recording
orders taken, or services rendered, as may be appropriate to the Lessee's
business and necessary or desirable to keep accurate Books and Records, and
without limiting the generality of the foregoing, for any activity involving
cash sales, install and use cash registers or other electronic cash control
equipment that provides for non-resettable totals and shall permit the
inspection by the officers, employees and representatives of the Port Authority
of any equipment used by the Lessee, including but not limited to any of the
foregoing equipment. In those situations where the Books
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and Records have been generated from computerized data (whether mainframe,
minicomputer, or PC-BASED computer systems), the Lessee agrees to provide, or
cause to be provided, to the Port Authority's representative extracts of data
files in a computer readable format on data disks, E-mail with attached files or
alternative computer data exchange formats suitable to the Port Authority in its
sole discretion.
(e) Without implying any limitation on the right of the Port Authority
to terminate this Lease, including but not limited to, for breach of any term,
condition or provision of paragraphs (a) through (d) above, the Lessee
understands that the full reporting and disclosure to the Port Authority of all
of the information described in paragraphs (a) through (d) above and provided by
the equipment and devices set forth in paragraphs (a) through (d) above and the
Lessee's compliance with all the provisions of said paragraphs (a) through (d)
are of the utmost importance to the Port Authority. In the event any Books and
Records are maintained outside the Port of New York District or in the event of
the failure of the Lessee to comply with all the provisions of paragraphs (a)
through (d) above then, in addition to all, and without limiting any other,
rights and remedies of the Port Authority under this Lease or otherwise and in
addition to all of the Lessee's other obligations under this Lease:
(i) the Port Authority may estimate any amount paid or payable to
the Port Authority on any basis that the Port Authority, in its sole discretion,
shall deem appropriate, such estimation to be final and binding on the Lessee
and the amounts payable to the Port Authority based thereon shall be payable to
the Port Authority when billed; and/or
(ii) if any Books and Records are maintained outside of the Port
of New York District, then the Port Authority in its sole discretion may (x)
require on ten (10) days' notice to the Lessee that any such Books and Records
be made available to the Port Authority within the Port of New York District for
examination and audit pursuant to paragraph (c) hereof and/or (y) examine and
audit any such Books and Records pursuant to paragraph (c) hereof at the
location(s) they are maintained and if such Books and Records are maintained
within the contiguous United States the Lessee shall pay to the Port Authority
when billed all travel costs and related expenses, as determined by the Port
Authority, for Port Authority auditors and other representatives, employees and
officers in connection with such examination and audit (all the foregoing costs
and expenses being hereinafter referred to as the "Contiguous Travel Costs"),
and if such Books and Records are maintained outside the contiguous United
States the Lessee shall pay to the Port Authority when billed all costs and
expenses of the Port Authority, as determined by the Port Authority, of such
examination and audit, including but not limited to, salaries, benefits, travel
costs and related expenses, overhead costs, and fees and charges of third party
auditors retained by the Port Authority for the purpose of conducting such audit
and examination (all the foregoing costs and expenses together with the
Contiguous Travel Costs being hereinafter referred to as the "Travel Costs").
Upon the request of the Lessee, the Port Authority shall provide to the Lessee
copies of invoices that the Port Authority has in its possession, if any, for
the Travel Costs and a certificate of the Port Authority setting forth the
Travel Costs.
(f) Without implying any limitation on the rights or remedies of the
Port Authority under this Lease or otherwise including without limitation the
right of the Port
218
Authority to terminate the Lease for breach of any term or provision of this
Section and in addition thereto, in the event any of the Books and Records are
not maintained in English, then the Lessee shall pay to the Port Authority when
billed, all costs and expenses of the Port Authority, as determined by the Port
Authority, to translate such Books and Records into English.
(g) In the event that, upon conducting an examination and audit as
described in this Section, the Port Authority determines that unpaid fees and/or
costs thereon are due and payable to the Port Authority by the Lessee, in
addition to any other amounts required by this Section to be paid by the Lessee
to the Port Authority, the Lessee shall pay to the Port Authority a service
charge in an amount equal to five percent (5%) of the amount determined by the
Port Authority to be unpaid. Such service charge shall be payable by the Lessee
upon demand therefor by the Port Authority and is exclusive of any and all other
moneys due to the Port Authority by the Lessee under this Lease or otherwise.
(h) Without limiting the generality of Section 16 hereof entitled
"Additional Rent and Charges", the foregoing auditing costs, expenses and
amounts of the Port Authority set forth in paragraphs (e), (f) and (g) above
shall be deemed rentals hereunder payable to the Port Authority with the same
force and effect as the rentals payable to the Port Authority pursuant to
Section 4 hereof entitled "Rental".
SECTION 66. GROUND TRANSPORTATION SERVICES
(a) The Lessee shall make available within the Premises at reasonable
rental rates, such counter spaces, wall telephone installations and self service
telephone kiosks at such locations as may be determined by the Port Authority
and the Lessee for use by limousine, bus, car rental, taxi and other ground
transportation operators at the Airport, all of the foregoing being hereinafter
called the "Ground Transportation Operators". The Lessee shall enter into an
agreement only with Ground Transportation Operators designated or approved by
the Port Authority, covering the occupancy of said counter space, which
agreement may provide for the payment of a basic rental (but no other rental,
charge or fee of any kind) to the Lessee for the counter space, provided that
such basic rental shall represent a fair and reasonable rental for the counter
space. The Port Authority shall have the right to, in its agreement with any
Ground Transportation Operator, impose obligations on the Ground Transportation
Operator with respect to its operation at the counter space, including but not
limited to the dissemination of information applicable to said service, and may
charge such fees payable to the Port Authority as it may determine.
(b) (1) In lieu of the provisions of paragraph (a) of this Section
obligating the Lessee to make available counter spaces, wall telephone
installations and self service telephone kiosks with respect to limousine, bus
and other Ground Transportation Operators at the Airport (but not including car
rental operators as to which the provisions of paragraph (a) shall be and
continue in full force and effect) the Lessee shall provide to the Port
Authority or its contractor, without charge, such counter space at such
locations as may be specified by the Port Authority within the Premises as may
reasonably be required for use as consolidated ground transportation reservation
and information counters (hereinafter called the "Consolidated Counters") to be
operated by the Port Authority or its contractors.
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(2) The Lessee agrees to provide access to and from the public
ways outside the Premises to the Port Authority, its employees and its
contractors and the ground transportation patrons and other users of the
Consolidated Counters; to permit use of such portions of the public pedestrian
circulation areas of the Premises as may reasonably be required for the
operation of the Consolidated Counters and the accommodation of the users
thereof; and to permit the installation of such telephone and other
communication lines, cables and conduits on and across the Premises as may be
required for the operation of the Consolidated Counters. The Lessee acknowledges
and agrees that the Consolidated Counters shall at all times be a part of the
Premises under this Agreement and subject to all the terms and provisions
thereof including, but not limited to indemnity, the payment of rentals, repair
and maintenance (it being understood that this shall not be deemed to limit the
liability of any independent contractor providing such service). The Lessee
shall, at its sole cost and expense, supply all utilities necessary for the
operation of the Consolidated Counters including but not limited to heat, light,
ventilation, air conditioning and electricity on a twenty-four (24) hour, seven
(7) day a week basis. The Lessee shall not be required to provide telephone
service to the Consolidated Counters hereunder.
(3) The Port Authority shall have the right at any time, without
cause, on one hundred eighty (180) days' notice to the Lessee to terminate and
discontinue the operation of the Consolidated Counters and from and after the
effective date stated in said notice the operation of the Consolidated Counters
shall terminate and cease and the provisions of this paragraph (b) shall be
null, void and of no further force and effect and the provisions of paragraph
(a) of this Section and the Lessee's obligations as set forth therein with
respect to limousine, bus, car rental and other Ground Transportation Operators
shall be deemed reinstated and in full force and effect.
(c) The Lessee shall provide appropriate seating for the public
waiting for Ground Transportation Operators, such seating to be conveniently
located to the Consolidated Counters and the counter spaces, wall telephone
installations and self service telephone kiosks described in paragraphs (a) and
(b) of this Section.
SECTION 67. GROUND TRANSPORTATION
(a) The Lessee may arrange for the transportation to and from the
Airport of its employees and their baggage (and such employees and baggage only)
either directly or by contract with a surface carrier or carriers (hereinafter
called the "Employee Surface Carrier(s)") of its choice, provided, that such
Employee Surface Carrier(s) are at all times Ground Carrier Permittees of the
Port Authority as defined in paragraph (b) hereof and provided, further, that
ten percent (10%) or such lesser percentage as may be set pursuant to paragraph
(e) hereof of the Gross Receipts received from the ground transportation of
employees and their baggage by the Employee Surface Carrier(s) providing such
service, or by the Lessee, including all advertising and any other revenues of
any type arising out of or in connection with said service (excluding only
local, state and federal transportation taxes which are separately stated to and
paid by the passengers and are directly payable to the taxing authority by the
Lessee or by the Employee Surface Carrier(s)) shall be paid to the Port
Authority. No fee shall be paid by the Lessee to the Port Authority in
connection with the ground transportation of employees and their baggage if
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the Lessee operates the service itself and if the Lessee makes no charge to its
employees and their baggage therefor.
(b) The Port Authority shall endeavor to issue permits to at least
twelve (12) qualified surface carriers (herein called the "Ground Carrier
Permittees") which permits shall grant to said Ground Carrier Permittees the
privilege of providing a service for the transportation to and from the Airport
of employees and their baggage of all Aircraft Operators at the Airport. Each
permit shall provide that the Port Authority shall have the right at any time to
revoke the permit granted to any Ground Carrier Permittee with or without cause
and regardless of whether any such Ground Carrier Permittee is an Employee
Surface Carrier(s) of the Lessee and regardless of any agreement between the
Lessee and its Employee Surface Carrier(s). Without limiting the foregoing
right, if the Ground Carrier Permittee selected by the Lessee shall at any time
fail to pay the Port Authority ten percent (10%) or such other percentage of its
Gross Receipts as established pursuant to paragraph (e) hereof as required under
the permit, the Port Authority shall have the right in addition to all other
rights and remedies, to deny such Permittee entrance upon the Airport for the
purpose of transporting employees and their baggage as aforesaid to and from the
Airport and the Lessee shall no longer use the same. In the event that there
should at any time during the term of this Lease be less than twelve (12) Ground
Carrier Permittees in operation at the Airport the Lessee shall have the right
to engage an Employee Surface Carrier(s) of its choice to provide the service
set forth in paragraph (a) hereof, subject, however, to the prior and continuing
approval of the Port Authority, and provided that such Employee Surface
Carrier(s) agrees to become a permittee of the Port Authority and to pay a
percentage of its Gross Receipts to the Port Authority in accordance with
paragraphs (a) and (e) hereof and only for so long as such permittee observes
and complies with the terms of its permit, it being understood that said
Employee Surface Carrier(s) may be restricted to serving the Lessee at the
Airport. At such time thereafter as there is in operation at the Airport at
least twelve (12) Ground Carrier Permittees, the permit with the said Employee
Surface Carrier(s) may be revoked by the Port Authority and the Lessee shall
thereupon select an Employee Surface Carrier(s) from the Ground Carrier
Permittees of the Port Authority. Nothing contained hereunder shall be deemed to
preclude the Port Authority from issuing from time to time during the term of
the Lease permits to more than twelve (12) Ground Carrier Permittees. The
Permits with the Ground Carrier Permittees may contain privileges other than
those set forth in this paragraph (b), including but not limited to the
privilege to transport passengers and baggage of Aircraft Operators. All permits
shall contain such terms or provisions as the Port Authority may deem from time
to time necessary or desirable.
(c) The Port Authority hereby states its intention to attempt to
incorporate, into all existing leases and into all new leases with all Scheduled
Aircraft Operators covering passenger terminal facilities within the Central
Terminal Area, provisions having the same effect as the provisions of paragraphs
(a) and (b) of this Section. The provisions of this Section shall be applicable
as well to Aircraft Operators who may be occupying space within the Central
Terminal Area pursuant to a sublease, subuse or Handling Agreement with any unit
terminal lessee or with the Lessee hereunder or with any sublessee thereof (the
foregoing not to waive the requirement for Port Authority consent).
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(d) The Lessee may arrange for the transportation to and from the
Airport of passengers and their baggage (and such passengers and baggage only)
either directly or by contract with a surface carrier or carriers (hereinafter
called "Passenger Surface Carrier or Carriers") of its choice, subject, however,
to the prior and continuing approval of the Port Authority and provided, that
such Passenger Surface Carrier or Carriers agree to become Permittees of the
Port Authority and provided, further, that ten percent (10%) or such lesser
percentage as may be set pursuant to paragraph (e) hereof of the Gross Receipts
received from the ground transportation of passengers and baggage by the
Passenger Surface Carrier or Carriers providing such service or by the Lessee,
including all advertising and any other revenues of any type arising out of or
in connection with said service (excluding only local, state and federal
transportation taxes which are separately stated to and paid by and are directly
payable to the taxing authority by the Lessee or by the Passenger Surface
Carrier or Carriers) shall be paid to the Port Authority. If the Passenger
Surface Carrier designated by the Lessee shall at any time fail to pay to the
Port Authority ten percent (10%) or such lesser percentage as may be set
pursuant to paragraph (e) hereof of its Gross Receipts as aforesaid when billed
therefor by the Port Authority, the Port Authority shall have the right to deny
such carrier entrance upon the Airport for the purpose of transporting
passengers and baggage as aforesaid to and from the Airport and the Lessee shall
no longer use the same.
(e) It is recognized that the Port Authority has established a five
percent (5%) fee with respect to the service covered by paragraphs (a) and (d)
hereof in lieu of the ten percent (10%) fee therein stated. It is hereby
specifically understood and agreed that the fact that said fee is presently five
percent (5%) shall not constitute a waiver by the Port Authority of its right to
impose a percentage fee of ten percent (10%) as provided in paragraphs (a) and
(d). It is hereby specifically agreed that the Port Authority shall have the
right at any time and from time to time during the term of this Lease to revise
the percentage fee it shall charge the Employee Surface Carrier(s), other
permittees and the Lessee as provided in paragraphs (a) and (d) hereof but in no
event shall said fee be greater than ten percent (10%). The Port Authority shall
notify the Lessee of any such revision.
(f) The Lessee may arrange for the transportation to and from the
Airport of freight and other cargo of the Lessee either directly or by contract
with the surface carrier or carriers of its choice. No permit or fee shall be
required of the Lessee or its contractor for the picking up from or the delivery
to of freight or other cargo from or to the Lessee. No fee shall be paid to the
Port Authority by the Lessee or its contractor for the privilege of transporting
freight or cargo of the Lessee on the surface as aforesaid. If such contractor
of the Lessee enters into a Lease or other agreement with the Port Authority for
space and/or privileges at the Airport, the rent or other compensation payable
to the Port Authority shall not be measured by the amount of freight or other
cargo of the Lessee transported on the surface by such contractor.
(g) The right of the Lessee to arrange transportation to and from the
Airport of its airline passengers as hereinabove provided shall not be construed
as being applicable to any establishment or operation by the Lessee of
facilities outside the Airport for the handling of airline passengers of the
Lessee arriving at or departing from the Airport.
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(h) As used in this Section, reference to passengers, baggage, freight
or other cargo of the Lessee shall be construed to mean persons, baggage,
freight or cargo transported or to be transported on aircraft of the Lessee.
(i) The Ground Carrier Permittee of the Lessee's choice, its
Passengers Surface Carrier or Carriers or any other contractor used by it shall
not solicit business on the public areas of the Airport and the Lessee shall
prohibit any such activity on the Premises or on any other area at the Airport
occupied by the Lessee. The use, at any time, either on the Premises or
elsewhere on the Airport of hand or standard megaphones, loudspeakers or any
electric, electronic or other amplifying devices is hereby expressly prohibited
and any advertising or signs shall be subject to continuing Port Authority
approval.
SECTION 68. GROUND TRANSPORTATION WITHIN THE CENTRAL TERMINAL AREA
(a) The Port Authority has established at the Airport a Central
Terminal Area generally as described in the exhibit attached hereto, hereby made
a part hereof and marked "Exhibit 68.1" and hereinafter called "Exhibit 68.1".
If at any time and from time to time during the term of the Lease, the Port
Authority substantially revises the Central Terminal Area, it shall thereafter
forward to the Lessee a revised exhibit showing the revised Central Terminal
Area which revised exhibit shall replace Exhibit 68.1 and shall become a part of
the Lease.
(b) (1) The Lessee hereby agrees that it will not directly, indirectly
or by arrangement with any independent third party, operate any surface vehicles
for the transportation of airline passengers to or from the Premises and the
various other passenger terminal facilities or other locations within the
Central Terminal Area. The prohibition hereinabove set forth in this paragraph
(b) shall be in effect only during such periods as there is in operation at the
Airport a CTA Ground Transportation Service as hereinafter defined to be
provided by an independent third party contractor. The "CTA Ground
Transportation Service" shall consist of the following: (i) a ground
transportation service for the transportation of airline passengers and other
persons between the various passenger terminal facilities, including the
Premises, within the Central Terminal Area including the service of transporting
a group of passengers where the Aircraft Operator must accommodate the group as
a whole (hereinafter called the "CTA Omnibus Service") and (ii) a ground
transportation service for the transportation of passengers of Aircraft
Operators within the Central Terminal Area, but only for a disabled passenger,
when a passenger must take a direct connection and for whom time is critical,
and in the very limited instance where an Aircraft Operator must accommodate a
particular passenger, the foregoing service being hereinafter called the "CTA
Supplementary Service". It is understood furthermore that, notwithstanding the
prohibition hereinabove set forth in this paragraph (b), the Lessee may
directly, indirectly or by arrangement with an independent third party, operate
surface vehicles for the transportation of its passengers to or from the
Premises and such passenger terminal facility of the Lessee, if any, located
outside the Central Terminal Area, provided, that the Lessee has the prior and
continuing approval of the Port Authority to operate such passenger terminal
facility outside the Central Terminal Area, that the aforesaid service shall not
serve any passenger terminal facility or location within the Central Terminal
Area other than the Premises and that if the Lessee utilizes a third party to
provide the service, said third party shall be subject to the prior and
continuing approval of the Port Authority, shall agree to become a permittee of
the Port Authority and shall pay the percentage of its Gross Receipts to the
Port Authority with
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respect to said service as specified in said permit and shall comply with all
the terms and conditions of its permit.
(2) Nothing contained in this paragraph (b) or paragraph (c) of
this Section shall impose or be construed as imposing an obligation on the Port
Authority to operate or cause to be operated the CTA Ground Transportation
Service for the transportation of passengers and other persons between the
various passenger terminal facilities, including the Premises, within the
Central Terminal Area.
(c) (1) (i) It is hereby agreed that it is in the best interests of
the Port Authority and all Participants as hereinafter defined that the CTA
Omnibus Service be a good, proper and efficient service, able to adequately,
timely and properly handle the ground transportation needs of airline passengers
and other persons between the various passenger terminal facilities including
the Premises within the Central Terminal Area. The parties recognize furthermore
that the CTA Supplementary Service should be a service that would transport
those persons authorized to be carried thereon in an adequate, proper and timely
manner so as to meet their flight connections.
(ii) The Port Authority agrees that it shall meet and
consult from time to time with the Participants with respect to the procedures,
schedules, fares, prices and operations of the CTA Omnibus Service and shall,
except in case of emergency, give the Participants prior written notice of any
substantive changes with respect thereto. Notwithstanding the foregoing, it is
hereby understood and agreed that the procedures, schedules, fares, prices,
operations and other matters affecting the CTA Omnibus Service shall be
determined by the Port Authority.
(iii) The Port Authority agrees that it shall meet and
consult from time to time with the Participants with respect to the procedures,
schedules, fares, prices and operations of the CTA Supplementary Service. Before
adopting any initial procedures or schedules covering the operation of the CTA
Supplementary Service and before putting into effect any modifications to any
procedures or schedules then in effect with respect to the CTA Supplementary
Service, except in case of emergency, the Port Authority shall submit the
initial or the changed procedures and schedules (hereinafter called the
"Submissions") to the Participants for their approval. If Participants
representing more than fifty percent (50%) of the effective published passenger
flight schedules to and from the Airport of all Participants for the calendar
year prior to the year in which the Submissions are made to the Participants for
their approval, approve the same, the Submissions shall be deemed to be approved
for all purposes hereunder and said approval shall be deemed binding as well
upon all other Aircraft Operators who may use or pay for the CTA Supplementary
Service, notwithstanding the fact that said Submissions had not been submitted
to them for their approval. Notwithstanding anything herein provided and without
limiting the provisions of paragraph (b) hereof, it is hereby understood and
agreed that the Port Authority shall have no obligation hereunder to itself
operate the CTA Ground Transportation Service nor any obligation to operate said
service through an independent contractor unless and until the Submissions with
respect to the CTA Supplementary Service submitted as aforesaid to the
Participants have been approved by the Participants in accordance with the
foregoing provisions. The failure of any Participant to disapprove the
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Submissions within twenty (20) days after submission thereof to it for approval
shall constitute such Participant's approval hereunder to said Submissions.
(iv) It is hereby understood and agreed that the amount to
be charged for the CTA Supplementary Service shall consist of an Initial Price
and, if the Port Authority so elects from time to time during the term of the
Lease, an Excess Price. The "Initial Price" shall be based upon the cost of the
CTA Supplementary Service. The Lessee shall pay to the Port Authority as and
representing the Initial Price its pro rata share of the cost to the Port
Authority of providing the CTA Supplementary Service. The Lessee's pro rata
share of the cost to the Port Authority of providing the CTA Supplementary
Service shall be that proportion of said cost as the number of passengers of the
Lessee who actually used the CTA Supplementary Service bears to the total number
of passengers using the CTA Supplementary Service. Except as provided in
subparagraph (c)(1)(v)(D) hereof, there will be no charge to the Lessee of
either an Initial Price or an Excess Price if the Lessee does not have any
passengers using the CTA Supplementary Service.
(v) (A) The Initial Price payable to the Port Authority
pursuant to subparagraph (iv) hereof is for each calendar year, but in the
event the term of the Lease expires or the provisions covering the CTA
Supplementary Service are terminated on a day other than the last day of a
calendar year, then in any such event the Initial Price payable to the Port
Authority pursuant to subparagraph (iv) hereof shall, for the year during
which such event occurs, be for such portion of said year during which the
Port Authority provides the CTA Supplementary Service. In determining the
Initial Price, the cost of the CTA Supplementary Service shall be computed,
determined and ascertained for each calendar year (or portion thereof upon
the occurrence of any of the events mentioned in the first sentence hereof)
of the term of this Lease.
(B) Notwithstanding the foregoing and for current
monthly or other periodical billing purposes as may from time to time be
selected by the Port Authority, the Port Authority shall establish interim
billing rates to cover the Initial Price for the CTA Supplementary Service.
Such billing rates shall be based on determinations by the Port Authority
of its estimate of the cost of the CTA Supplementary Service for the
calendar year and the number of passengers to be using the CTA
Supplementary Service for said calendar year. Such determinations shall be
based upon the prior calendar year's experience, if any, and upon such
other reasonable basis as the Port Authority may determine. The Port
Authority may prospectively revise its billing rates during any calendar
year. On the 20th day of each calendar month the Lessee shall pay to the
Port Authority the amount due as the Initial Price for the preceding
calendar month, which shall be determined by multiplying the interim
billing rate per passenger for the Initial Price established by the Port
Authority as aforesaid by the number of Lessee's passengers carried on the
CTA Supplementary Service for the previous calendar month.
(C) As soon as practicable after the expiration of each
calendar year, the Port Authority shall determine the cost of the CTA
Supplementary Service and the Initial Price payable therefor. Corrected
▇▇▇▇▇▇▇▇ based upon such
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determination shall thereupon be rendered by the Port Authority and if any
monies are due to the Port Authority they shall be promptly paid by the
Lessee and if any monies are due to the Lessee they shall be promptly
credited to it.
(D) In the event and only in the event that the CTA
Supplementary Service for all or any portion of a calendar year has been
provided by the Port Authority but there has been no use thereof by any of
the Participants, then the Initial Price and the Excess Price shall be
payable by all Participants and each Participant's share shall be based on
the number of passengers on its outbound and inbound aircraft at the
Airport compared to the total number of passengers on all inbound and
outbound aircraft using the Airport of all Participants. The Port Authority
agrees that, if as of the commencement of any calendar year there appears
to be no use by the Participants of the CTA Supplementary Service, it will
use all reasonable efforts to limit its payments to the contractor for the
CTA Supplementary Service for such period where there appears to be no use.
(vi) (A) The Port Authority shall have full discretion in
awarding a contract for the CTA Ground Transportation Service and may award
the same to a contractor who has not proposed the lowest price for the CTA
Supplementary Service or the CTA Omnibus Service. As stated in subparagraph
(1)(iv) hereof the Port Authority shall have the right to charge the
Lessee, in addition to the Initial Price for the CTA Supplementary Service,
an additional amount herein called the "Excess Price", which amount shall
be applied to offset any deficit in the CTA Omnibus Service.
(B) The amount representing the Excess Price shall be
an amount payable only by the Lessee if it uses the CTA Supplementary
Service and shall be an amount fixed for each passenger using the CTA
Supplementary Service. The Port Authority shall advise the Participants
prior to the beginning of each calendar year of the amount per passenger
which shall constitute the Excess Price for said calendar year. On the 20th
day of each calendar month during the term of this Lease and on the 20th
day of the calendar month immediately following the end of the term of this
Lease, the Lessee shall pay to the Port Authority the amount due as the
Excess Price for the preceding calendar month, which shall be determined by
multiplying the amount per passenger for the Excess Price established by
the Port Authority as aforesaid by the number of Lessee's passengers
carried on the CTA Supplementary Service for the previous calendar month.
As soon as practicable after the expiration of each calendar year, the Port
Authority shall determine the cost of the CTA Omnibus Service for said
calendar year. If there is no deficit or if the deficit is less than the
amount received by the Port Authority from users of the CTA Omnibus
Service, then the total amount of the Excess Price if there is no deficit
or the amount of the Excess Price which is over and above any deficit on
the CTA Omnibus Service shall be refunded or credited to the Participants
based on the portion of each Participant's payments of the Excess Price for
said calendar year as compared to the total amount received as the Excess
Price from all Participants. In determining whether or not there is a
deficit or in determining the amount of the deficit, revenues from the CTA
Omnibus Service shall be deemed to be 87.5% of the cost of the CTA Omnibus
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Service whether or not the revenues actually received add up to 87.5%, but
if said revenues exceed 87.5% of the cost, the actual amount of revenues
received shall be used.
(vii) The Port Authority shall determine for each calendar
year (or portion thereof, where applicable) the cost to the Port Authority of
providing the CTA Omnibus Service and the cost to the Port Authority of
providing the CTA Supplementary Service. Each such cost shall be determined in
accordance with the Port Authority's normal accounting practice and shall
consist of those of the following items, which are applicable to each such
service:
(A) All payments made by the Port Authority to the
independent contractor for providing the CTA Supplementary Service or the
CTA Omnibus Service, as the case may be (it being understood that the Port
Authority shall not impose any percentage charge or fee on the contractor
for such services);
(B) On-the-job payroll costs of Port Authority
employees working in any aspect of the CTA Supplementary Service or the CTA
Omnibus Service, as the case may be, including but not limited to
contributions to any retirement system or the cost of participation in any
pension plans or the like, social security, old age, survivors, disability
and employment insurance and other insurance costs, sick leave pay,
holiday, vacation, authorized absence and severance pay, other employee
fringe benefits and any other payments made or costs incurred whether
pursuant to law or by Port Authority policy to or with respect to said
employees;
(C) The cost (including rental charges) to the Port
Authority of providing space, equipment, materials, facilities or services
to or in connection with the CTA Omnibus Service or the CTA Supplementary
Service, as the case may be;
(D) Payments of premiums (or to the extent of
self-insurance an amount equivalent to what the premiums would have been)
for insurance with respect to the CTA Omnibus Service or the CTA
Supplementary Service, as the case may be, including without limitation
thereto, fire and extended coverage, workmen's compensation and commercial
general liability;
(E) Other direct costs as charged under the Port
Authority's normal accounting practice;
(F) With respect to the CTA Omnibus Service, ten
percent (10%) of the amounts paid to the contractor providing said service
under item (A) hereof and with respect to the CTA Supplementary Service,
twenty percent (20%) of the amount paid to the contractor providing said
service under item (A) hereof.
(viii) In the event that any specific cost incurred or any
specific amount expended for any of the items hereinabove set forth covers both
the CTA Omnibus Service and the CTA Supplementary Service, then the Port
Authority shall divide and allocate
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any such cost or amount as between the CTA Omnibus Service and the CTA
Supplementary Service in accordance with its normal accounting principles.
(2) (i) If at any time during the term of the Lease the Port
Authority receives a written notice from at least two Participants (as
hereinafter defined) representing more than thirty percent (30%) of the
effective published passenger flight schedules to and from the Airport of all
Participants for the calendar year prior to the year during which the notice was
given, which notice shall be either (x) to the effect that the service being
provided by the contractor furnishing the CTA Ground Transportation Service does
not satisfy the standards set forth in item (i) of subparagraph (1) hereof and
specifying whether it is the CTA Omnibus Service or the CTA Supplementary
Service, or both, which is at fault, and further specifying the nature and
extent of the failure or (y) to the effect that the Participants serving the
notice are dissatisfied for any reason with the service, the Port Authority
shall endeavor in the case of item (x) of this subparagraph (2)(i) to rectify
the conditions complained of either by the existing contractor doing so or by
engaging a new contractor to provide the CTA Ground Transportation Service or by
a combination of both.
(ii) If the Port Authority receives, by a date no earlier
than one hundred twenty (120) days and no later than one hundred eighty (180)
days after its receipt of either notice covered by subparagraph (c)(2)(i)
hereof, a written notice from at least two Participants representing more than
fifty percent (50%) of the effective published passenger flight schedules to and
from the Airport of all Participants for the year prior to the year during which
the notice is given, which notice is to the effect that the Participants sending
the notice continue to be dissatisfied with the CTA Ground Transportation
Service whether provided by the old contractor, or if said contractor has been
replaced, by the new contractor, then the Port Authority agrees that, effective
no later than sixty (60) days after its receipt of said notice (said date to be
established by written notice to the Participants) the provisions of this
Section covering the CTA Ground Transportation Service shall be terminated and
shall no longer be in effect and from and after said date the Lessee shall have
the right directly or by arrangement with an independent third party to operate
surface vehicles for the transportation of airline passengers to and from the
Premises and the various other passenger terminal facilities or other locations
within the Central Terminal Area, provided, however, that the same shall be used
exclusively for the transportation of disabled passengers, passengers who must
make a direct connection and where time is critical, in the very limited
instances where an airline must accommodate particular passengers, and for the
transportation of passengers traveling as a group where an airline must
accommodate the group as a whole, it being understood that the foregoing
limitation on the right of the Lessee shall be in effect only during such
periods as there is in operation at the Airport a CTA Omnibus Service as defined
in paragraph (b) hereof (the Port Authority having no obligation so to do),
excluding the transportation of passengers traveling as a group, and provided,
however, that if the Lessee utilizes a third party to provide said service, that
said third party shall be subject to the prior and continuing approval of the
Port Authority, shall agree to become a permittee of the Port Authority and
shall pay the percentage of its Gross Receipts to the Port Authority with
respect to its service as specified in said permit and shall comply with all the
terms and conditions of its permit.
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(d) (1) The Port Authority hereby states its intention to attempt to
incorporate into all new leases and into all existing leases which may not
already include the same with all Persons covering passenger terminal facilities
within the Central Terminal Area provisions having the same effect as the
provisions of this Section. The term "Participants" shall mean all Persons
(including for the purposes hereof, the Lessee) who have executed leases with
the Port Authority covering passenger terminal facilities within the Central
Terminal Area and containing provisions having the same effect as the provisions
of this Section
(2) All Aircraft Operators who may be occupying space within the
Central Terminal Area pursuant to a sublease, subuse or Handling Agreement with
any Participant (including the Lessee hereunder) shall be obligated to comply
with all obligations of this Section which are applicable to the Participants,
but said Aircraft Operators shall not be or be deemed to be Participants within
the meaning of subparagraph (1) of this paragraph (d), but their activities,
operations and payments hereunder shall be deemed to be those of the
Participants whose space they are using.
(e) The agreement by the Lessee under paragraph (b) hereof as well as
the agreement by the Lessee under paragraph (c)(2) hereof, in the event the
provisions covering the CTA Ground Transportation Service are terminated and are
no longer in effect, are of the essence of this Section and the Lessee agrees
that the Port Authority shall be entitled to a decree against the Lessee
requiring the specific performance thereof in any court of equity having
jurisdiction. The aforesaid remedy shall not constitute the exclusive or sole
remedy which may be available to the Port Authority hereunder in the event the
Lessee breaches its agreement.
SECTION 69. HELICOPTER OPERATIONS
The Lessee hereby acknowledges that the Lease does not grant to it any
right and the Lessee does not have any right to use or permit the use of any
portion of the Premises for the landing or taking off of helicopters, rotary
wing, tilt rotor or other similar aircraft. In the event that the Port Authority
determines that approval for such use will be given at any time hereafter, the
same shall be granted only in accordance with such terms and conditions,
including but not limited to fees, charges and rights of user, as the Port
Authority may set forth in a supplement to the Lease, which is duly executed by
the Lessee and the Port Authority.
SECTION 70. ITINERANT AIRCRAFT
(a) The Port Authority hereby grants to the Lessee the privilege of
permitting the occasional use of the Premises by air taxi, corporate and private
aircraft (sometimes hereinafter called the "Itinerant Aircraft") for the sole
purpose of discharging or picking up passengers, business guests and other
invitees of the Lessee. All operations of such Itinerant Aircraft shall be in
compliance with all the terms and provisions of this Lease and with the Rules
and Regulations of the Port Authority. The Lessee shall be completely
responsible for all acts and omissions of said Itinerant Aircraft as if said
acts and omissions were the acts or omissions of the Lessee.
(b) The Port Authority shall have the right to cancel the privilege
granted to the Lessee as set forth in paragraph (a) hereof in whole or in part
or with respect to any particular
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Itinerant Aircraft at any time and from time to time and without cause upon
thirty (30) days' written notice to the Lessee, and upon the effective date of
such notice the Lessee shall no longer have the right to permit all or any
specific Itinerant Aircraft as specified in the notice to use the Premises as
hereinabove provided, but the same shall not affect the Lease or any of the
terms, rentals, fees, provisions or agreements hereof, all of which shall
continue in full force and effect.
SECTION 71. CONSTRUCTION LETTER AGREEMENT
The parties have heretofore entered into a letter agreement dated May
6, 2005 (as the same shall be amended herein called the "Construction Letter
Agreement") covering the Lessee's performance of certain portions of the
Construction Work covered by Port Authority construction applications nos.
Y-7530.03, Y-7530.04 and Y-7530.05 (the work performed under and covered by the
Construction Letter Agreement being herein referred to as the "Prior Work"). The
Port Authority and the Lessee hereby agree that notwithstanding anything in the
Letter Agreement, Sections 2, 6, 7, 28, 30, 32, 35, 36, 56, 62, 63, 65, 84, 85,
87 and 93 of this Agreement shall supercede the Construction Letter Agreement
and said Sections 2, 6, 7, 28, 30, 32, 35, 36, 56, 62, 63, 65, 84, 85, 87and 93
shall cover and apply to the performance of all of the Prior Work.
SECTION 72. IN-FLIGHT MEALS
(a) (1) If the Lessee desires to prepare, for its exclusive use,
In-Flight Meals for consumption by passengers and crew on board aircraft
operated by the Lessee and to deliver such In-Flight Meals to such aircraft it
shall have the right to do so, individually or through a contractor of its own
choice (which contractor shall not be another Person engaged in the business of
transportation by aircraft). If the Lessee does so directly, it shall do so only
on space located outside the Central Terminal Area. The foregoing, however,
shall create no obligation on the part of the Port Authority to provide such
space and shall in no way be deemed a commitment by the Port Authority that any
such space shall be available. If the Lessee chooses to use an independent
contractor, such contractor shall be a regular "In-Flight Meal Operator" by
which is meant an operator authorized by the Port Authority to provide In-Flight
Meals to Aircraft Operators at the Airport unless, in the opinion of the Lessee,
all regular In-Flight Meal Operators are unsatisfactory to the Lessee, in which
case the Lessee may employ any other contractor (other than another Person
engaged in the business of transportation by aircraft), satisfactory to the Port
Authority, who will accept a permit from the Port Authority on the same terms
and conditions including the same rates, fees or charges as imposed upon and
required of the Port Authority's In-Flight Meal Operators.
(2) The Lessee shall have the further right, either directly or
through an independent contractor of its choice, satisfactory to the Port
Authority, or by arrangements, jointly with one or more other users at the
Airport, to employ a contractor, satisfactory to the Port Authority, to prepare
outside the Airport and to deliver at the Airport to aircraft operated by the
Lessee, In-Flight Meals for consumption by passengers and crew on board such
aircraft, provided, however, that if the Lessee employs a contractor either
alone, or, by arrangement, jointly with one or more other users at the Airport
for the preparation, outside the Airport, of In-Flight Meals, then the Lessee
shall cause such contractor to pay to the Port Authority the rate or rates which
would be payable to the Port Authority by a regular Port Authority In-Flight
Meal
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Operator for the off-Airport preparation or delivery, or both, of such In-Flight
Meals to aircraft for consumption by passengers and crews on board such
aircraft.
(b) (1) The Lessee has advised that it may use more than one
independent contractor to furnish its In-Flight Meals at the Airport but may not
wish to have all of said contractors become permittees of the Port Authority
under permits which require, as aforesaid, the permittees to pay fees at the
rates imposed on the Port Authority's In-Flight Meal Operators upon Gross
Receipts based on amounts the Lessee pays said contractors.
(2) Should the Lessee elect not to have all its independent
contractors be Port Authority permittees as aforesaid, it shall serve a written
notice on the Port Authority to such effect which notice shall state that it
elects the method of additional payment as hereinafter set forth and thereupon
the Port Authority shall consent thereto provided that, in addition to all other
amounts payable to the Port Authority under paragraph (a) above, the Lessee
shall pay and the Lessee hereby agrees to pay to the Port Authority an amount
determined by applying the rates referred to in paragraph (b)(1) above to the
amounts payable by the Lessee to said independent contractors for its In-Flight
Meals or any part thereof delivered to the Lessee's aircraft at the Airport
(whether such delivery be by said independent contractor, the Lessee or
another). The foregoing payments by the Lessee shall be made monthly on the
twentieth (20th) day of the month commencing with the first (1st) month
immediately following the Lessee's notice and continuing each month thereafter
up to and including the twentieth (20th) day of the month following the
Expiration Date. The Lessee at anytime on at least thirty (30) days' prior
written notice to the Port Authority may change from its selection above and the
Lessee may at any time advise the Port Authority that this paragraph (b) no
longer applies to it based upon its representation that it then shall make, that
all payments made by it for In-Flight Meals shall be made to its contractors who
are permittees of the Port Authority as In-Flight Meal Operators.
(3) It is hereby expressly recognized that the procedures allowed
under this paragraph (b) are not included within the contemplation of the
provisions of paragraph (a) above and that the inclusion of the same within this
paragraph (b) shall not constitute or be deemed to constitute any concession or
agreement by the Port Authority that said procedures are not in violation of
paragraph (a) hereof.
SECTION 73. CONSUMER SERVICES
(a) The Lessee shall use its best efforts to develop and operate at
the Premises a premier world-class retail program that will support and advance
the role of the Premises in providing a convenient and comfortable arrival to
and departure from the Airport, consistent with the image and status of New York
City as a foremost domestic gateway and America's foremost international
gateway. The Lessee's retail program shall embody the Lessee's full commitment
to quality, value and customer service, evidence operations in accordance with
the best industry practices, evidence compliance with the Port Authority's
maximum standards with regard to service, health, sanitation and safety, and
evidence the Lessee's full commitment to the maximum financial return to the
Lessee and the Port Authority. A "premier world-class" retail program is one
that consistently scores within the top ten percent (10%) of industry-recognized
surveys, including without limitation the International Airline Transport
Association (IATA)
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Airport Monitor and Port Authority-sponsored surveys, which contain evaluations
or ratings of passenger terminal retail programs, or specific components
thereof, of the same type or class.
(b) (1) The Lessee acknowledges that various portions of the Premises
will be utilized for consumer services and said portions which receive the
concurrence of the Lessee and the Port Authority, as hereinafter provided, are
herein referred to as the "Concession Areas". Without limiting the provisions of
Section 64 hereof entitled "The Lessee's Ongoing Affirmative Action, Equal
Opportunity and Local Business Enterprises Commitment", the Lessee shall develop
and submit to the Port Authority, in accordance with the schedule described in
the second paragraph of this paragraph (b)(1), for its approval a comprehensive
plan for consumer services, setting forth, inter alia: (i) the types of
concessions to be placed there and the number of each type and size, designated
location, and configuration of each concession, as well as the overall plan of
the portions of the Premises designated for consumer service operations; (ii)
the minimum rentals/fees required for each type of concession; (iii) the
structure and level of any common area maintenance fees, marketing fees,
delivery fees, and utility recoveries (to the extent permitted) to be charged to
concession operators ; (iv) the Lessee's plans to provide retail opportunities
for Minority Business Enterprises and Women-owned Business Enterprises (as
defined in Schedule E hereto); (v) the Lessee's quality and service standards
and required hours of operation; (vi) the Lessee's specific plans to monitor and
enforce the "Street Pricing" policy (defined in paragraph (f)(1) of this
Section), quality and service standards and required hours of operation; (vii)
any other basic business terms including, but not limited to, any mandatory
investment and refurbishing requirements; (viii) a customer service program that
incorporates the mission and vision of the Port Authority's Aviation Department
as set forth in the Airport Standards Manual provided to the Lessee; and (ix)
such other information as the Port Authority may deem appropriate to its review
and determination if it will approve the proposed plan. The types of concessions
to be placed in the Concession Areas shall include those set forth in Sections
74 through 79 hereof, and the Lessee agrees that it will at all times throughout
the term of the letting hereunder keep said comprehensive plan updated and that
said updated plan shall be submitted to and be subject to the continuing
approval of the Port Authority. The Port Authority shall furnish to the Lessee
guidelines including those set forth in the Airport Standards Manual to be
utilized by the Lessee with respect to all matters affecting consumer services
in the Concession Areas including the aforesaid Lessee's comprehensive plan. The
Lessee agrees to meet and consult with the Port Authority, and provide
representatives to meet and consult with the Port Authority and representatives
of other airlines operating at the Airport, when requested to do so in order to
discuss the Lessee's performance in meeting the standards required by paragraph
(a) of this Section and its implementation of the Port Authority guidelines on
matters affecting consumer services in the Concession Areas.
The Lessee shall submit the comprehensive plan for consumer
services in accordance with the following schedule: (1) within eighteen (18)
months following the Lease Commencement Date, the required information to the
extent available but in all events a comprehensive plan identifying the amount
and location of the square footage to be allocated to consumer services in the
Terminal, (2) within six (6) months after the expiration of eighteen (18) months
following the Lease Commencement Date, and at six-month intervals thereafter, a
revised comprehensive plan containing the required information to the extent
available and (3) within thirty (30) months following the Lease Commencement
Date, the full and complete
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comprehensive plan containing the required information listed in clauses
(i)-(ix) of the preceding paragraph.
(2) The comprehensive plan shall be subject to the approval of
the Port Authority, as provided in this Section. The Lessee shall submit to the
Port Authority for its written approval at annual intervals, on each anniversary
of the Lease Commencement Date beginning with the third (3rd) anniversary
thereof, during the term of the letting hereunder (or more frequently if desired
by the Lessee or if reasonably requested by the Port Authority) a revised
comprehensive consumer services plan, which shall contain the items of
information enumerated in subparagraph (1) above. The Port Authority shall,
after its receipt of a proposed revised comprehensive plan, advise the Lessee in
writing of the Port Authority's approval, conditional approval or disapproval.
In the event of disapproval or conditional approval, the reasons therefor shall
be stated, and the Lessee may thereafter submit for Port Authority approval an
appropriately modified proposed revised comprehensive plan. Unless and until a
revised comprehensive plan shall have been approved by the Port Authority in the
foregoing manner, the comprehensive plan previously approved and then in effect
shall continue in effect.
(c) After approval by the Port Authority of the Lessee's comprehensive
plan for consumer services the Lessee shall pursue any one of (or a combination
of) the following alternatives (each an "Alternative", collectively the
"Alternatives"), in furtherance of the comprehensive plan for consumer services.
(1) The Lessee shall enter into a written agreement with a
subsidiary wholly-owned by the Lessee ("Related Entity") or with a concession
manager which is not an Affiliate of the Lessee ("Non-Related Entity"; the
Related Entity and Non-Related Entity being hereinafter referred to as the
"Concession Manager"), either as an independent contractor or, alternatively, as
a subtenant of the Lessee, to manage the Lessee's concession program at the
Premises. The Concession Manager may be a retail asset manager or a developer.
The Concession Manager shall thereafter enter into operating agreements with
third parties, who shall operate as concession operators, providing products and
services in concession spaces at the Premises ("Alternative 1"). Any such
agreement with a Concession Manager, and all operating agreements entered into
with third party operators, shall require the prior written consent of the Port
Authority as described herein. The Lessee shall not finalize negotiations with
any proposed Concession Manager, and the Lessee's Concession Manager shall not
finalize negotiations with any proposed operator, until receipt of notice from
the Port Authority that said arrangement is acceptable to the Port Authority,
and any executed agreement with any proposed manager or operator, as applicable,
shall not be effective until said manager or operator, as applicable, has
entered into the appropriate contractual agreement with the Port Authority, in
form and substance satisfactory to the Port Authority in its sole discretion
which grants consent and approval to such Concession Manager, as follows: (a)
among the Lessee, the Concession Manager, and the Port Authority and (b) among
the Concession Manager, the third party operator, and the Port Authority to be
consented to by the Lessee. Alternative 1 is more fully described in paragraph
(k) of this Section.
(2) The Lessee shall enter into direct agreements with each
concession operator to provide products and services in Concession Areas at the
Premises as part of the Lessee's concession program at the Premises
("Alternative 2"). The Lessee shall not finalize
233
negotiations with any operator until it has received notification from the Port
Authority that said arrangement is acceptable to the Port Authority and any
agreement the Lessee executes with any proposed operator shall not be effective
until said operator has entered into the appropriate contractual agreement with
the Port Authority, in form and substance satisfactory to the Port Authority in
its sole discretion.
(3) The Lessee shall enter into agreements for the operation of
concessions at the Premises which evidence agreements other than those described
in subparagraphs (c)(1), (c)(2) or (c)(4) of this Section ("Alternative 3"). It
is acknowledged that an agreement whereby an unaffiliated third party of the
Lessee is selected by the Lessee to both manage and operate a category or
categories of concessions (e.g., food-and-beverage concessions (including
restaurants and bars); retail concessions (including services such as currency
services, ATMs, specialty retail, and newsstands)) shall fall within this
Alternative 3. The Lessee shall not finalize negotiations with any Person under
this subparagraph until it has received notification from the Port Authority
that said arrangement is acceptable to the Port Authority and any agreement the
Lessee executes with such Person shall not be effective until said third party
has entered into the appropriate contractual agreement with the Port Authority,
in form and substance satisfactory to the Port Authority in its sole discretion.
(4) Only with the prior written consent of the Port Authority,
the Lessee shall have the right to both manage and operate concessions, using
its own employees, providing products and services in concession spaces at the
Premises. The Lessee shall not enter into subleases or agreements with third
parties to either manage or operate concessions under this Alternative
("Alternative 4"). Notwithstanding the privilege that may be granted to the
Lessee by the Port Authority under this Alternative 4, the Port Authority must
approve, in advance, all aspects of the Lessee's concessions program through the
approval process set forth in connection with the comprehensive plan, described
in this Section, including but not limited to the products and services to be
provided as part of the concessions program. If and to the extent that the
Lessee desires to cause any of its obligations under this Section to be
performed by employees of a third party unaffiliated with the Lessee, the Lessee
and the unaffiliated third party shall be obligated to obtain the prior written
consent of the Port Authority, to be evidenced by Port Authority agreement;
provided, however, that any such third party arrangement shall not qualify as,
i.e., take the form of, any of the other Alternatives described in this Lease.
The Lessee's obligations as a manager and operator of concessions shall be
consistent with the terms of this Lease and shall be evidenced by a written
agreement to be entered into between the Lessee and the Port Authority on terms
acceptable to the Port Authority in its sole discretion, it being understood
that nothing in this Section shall relieve the Lessee of its obligation to
comply with all other terms and provisions of this Lease.
(5) The Port Authority's approval of a comprehensive plan, or
modifications thereto, shall in no way diminish the applicability of this
paragraph (c). The effectiveness of the Lessee's agreement with a proposed
manager or operator, and further agreements between the Lessee's Concession
Manager and proposed operators shall be subject to the Port Authority's prior
written consent, as contained in the aforesaid appropriate contractual
agreement, and the Lessee's agreement as well as the Concession Manager's
agreements shall state the same. The foregoing procedure will be followed
throughout the term of the letting
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hereunder. It is expressly understood and agreed that the provisions of this
Section shall not limit or be deemed to limit the provisions of Section 64
hereof and the Lessee's on-going affirmative action commitment with respect to
the consumer services awards and agreements provided for herein.
(d) (1) The Port Authority hereby reserves exclusively to itself and
its designees the right on the Premises to implement, conduct, control and
receive any rents, fees or profits with respect to any of the following uses,
operations or installations (collectively, the "Reserved Uses"):
(i) advertising, provided that the Lessee shall retain the
right to control the placement of the particular advertising within the Premises
and the right to reject any proposed advertising at the Premises,
(ii) public telephones (sometimes also referred to as "pay
phones" "pay telephones" or "public telephones"), pre-paid phone cards,
facsimile transmission machines and other public communications services and
facilities, including without limitation, public communications services and
facilities that operate within the licensed spectrum radio frequency allocations
and including in particular, but without limitation, "cellphone"/cellular
technology and any technology that substitutes for, replaces or is used in
conjunction with cellphone/cellular technology, and also including all Port
Authority-owned or operated information and communications technology
infrastructure for common Airport use, provided that the Lessee shall retain the
right to control the location of the placement within the Premises of
telephones, phone banks, phone kiosks, facsimile transmission machines and
internet kiosks, only, and the right to deny, upon reasonable grounds, the
placement of a particular pay phone facility, facsimile transmission machine or
internet kiosk, only; notwithstanding that the Lessee has developed its own
wireless data communications services system that utilizes the technology
commonly known as "Wi-Fi," the Lessee covenants and agrees to meet with
representatives of the Port Authority and its neutral-host wireless
telecommunications network access system provider, New York Telecom Partners,
LLC ("NYPT"), and/or its parent entity, Concourse Communications Group, LLC
("Concourse"), and to use commercially reasonable efforts to negotiate with
NYTP/Concourse to provide NYTP/Concourse an unfettered right of access to the
Premises for the purpose of installing, operating and maintaining equipment and
facilities to provide Wi-Fi service to the public in the Premises.
(iii) vending machines dispensing anything including, but
not limited to, catalog and electronic sales (except in non-public areas of the
Premises for products then permitted to be sold on the Premises under agreements
or subleases approved by the Port Authority as required under this Lease),
provided that the Lessee shall retain the right to control the placement of
vending machines within the Premises and the right to reject any vending machine
at the Premises,
(iv) ground transportation (including vehicle rentals)
reservations, as provided in Section 66 entitled "Ground Transportation
Services" hereof,
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(v) provision of on-airport baggage carts (other than
shopping carts made available free of charge to retail shoppers within the
Concession Areas) or other on-airport baggage-moving devices, provided that the
Lessee shall retain the right to control the placement of baggage cart stations
within the Premises and the right to reject any on-airport baggage carts at the
Premises.
If and when the Port Authority elects to share with the other unit terminal
operators at the Airport the revenues from the activities set forth in items
(ii), (iii), (iv) and/or (v) of this paragraph (d)(1), the Lessee acknowledges
and agrees that the Port Authority shall not be required to share such revenues
with the Lessee and the Lessee hereby relinquishes and waives all rights and
claims to receive any portion of such revenues.
(2) The Port Authority (and any party specifically authorized
thereby) may engage in the Reserved Uses and install, operate, maintain and
repair the property used in connection therewith, in such locations as may be
determined by the Lessee. The Lessee, at its expense, shall provide the
necessary wires and conduits for the supply of electricity and telephone and
other communications interconnections for the Reserved Uses.
(3) The Port Authority shall direct that the Lessee be remitted,
out of the fees or rents actually paid by the third party operator(s) pursuant
to agreements for item (i) of subparagraph (d)(1) above and allocable to the
Premises, 50% of such fees or rents. The balance of all such fees or rents shall
be paid to and retained by the Port Authority. Except as specifically provided
in the foregoing sentence, the Port Authority shall have the right to all
revenues derived from the Reserved Uses without compensating the Lessee in any
manner on account of such uses or revenues.
(e) Except to the extent modified by and in accordance with an
effective comprehensive consumer services plan, the Lessee shall under
Alternative 4, and the Lessee shall require (i) in its management agreement
under Alternative 1, (ii) in its subleases under Alternative 2, (iii) in its
agreement under Alternative 3 and (iv) in any and all other agreements which
require or permit concession operation, the following with respect to hours and
days of operation:
(1) Retail food and beverage service shall be made available to
the public at one or more locations continuously each day during the hours
commencing no later than one hour prior to the first scheduled aircraft
departure from the Premises and continuing until at least the completion of
boarding for the last actual departure from the Premises of a flight therefrom
the same day. At least fifty percent (50%) of the concessions in any food
service area at any one time shall operate continuously throughout the hours
specified above.
(2) Commencing no later than one hour prior to the first
scheduled aircraft departure at the Premises each day and continuing until at
least the last actual departure at the Premises of a flight for departure
thereat the same day, at least one retail newsstand shall be continuously open
for business and at least one area accessible to "meeters and greeters" shall be
open.
236
(3) Certain foreign currency exchange services, through a staffed
location or an automated currency exchange machine, shall be continuously
provided to the public in the Foreign Inspection Services area, if any, and at
least one other central location in the Premises during the hours commencing no
later than one hour prior to the first scheduled aircraft departure from the
Premises and continuing at least until the later of (i) the completion of
boarding for the last actual departure from the Premises of a flight scheduled
for departure therefrom the same day and (ii) one hour after the last actual
arrival at the Premises of a flight scheduled for arrival thereat the same day.
(4) In the arrival area and one other central location in the
Premises, there shall be at least one automated teller machine fully operational
and accessible to the public twenty-four (24) hours a day with cash in
quantities sufficient to meet reasonably anticipated demand and providing access
to at least one of the two largest banking networks available in the Port of New
York District.
(5) In any instance in which no minimum hours have been set forth
above and as to all other concession operators (including without limitation
concession operators under Alternative 3), the concession operators shall be
required to be open for business and operate their respective businesses as
provided in the comprehensive consumer services plan.
(6) The Lessee shall require all concession operators (including
without limitation concession operators under Alternative 3) to operate their
respective businesses so as to maximize their revenues in accordance with best
industry practices and standards observed generally by first-class business
enterprises of regional or national scope which operate at other major airports.
(f) (1) The agreement with (i) the Concession Manager (if and to the
extent the Lessee pursues Alternative 1), (ii) any other third party if and to
the extent the Lessee pursues Alternative 3, (iii) the concession operator (if
and to the extent the Lessee pursues Alternative 2) and (iv) the Lessee (if and
to the extent the Lessee is permitted by the Port Authority to pursue
Alternative 4) shall also provide that such Concession Manager, third party,
concession operator or Lessee, as the case may be, that the concession operator
in its operations pursuant to its agreement, shall not charge prices to its
customers in excess of "Street Prices", defined as follows:
(i) If the concession operator conducts a similar business
in off-airport location(s) in the Greater New York City-Northern New Jersey
Metropolitan Area (the "Metro Area"), "Street Prices" shall mean the price
regularly charged by the concession operator for the same or similar item in the
Metro Area;
(ii) If the concession operator does not conduct a similar
business in off-airport location(s) in the Metro Area, "Street Prices" shall
mean the average price regularly charged in the Metro Area by similar concession
operators for the same or similar item;
237
(iii) If neither the concession operator nor other similar
concession operators sell a particular item in the Metro Area, "Street Prices"
shall mean the price regularly charged by the concession operator or similar
concession operators for the same or similar item in any other geographic area
with a reasonable adjustment for any cost-of-living variance between such area
and the Metro Area; and
(iv) If a concession operator is in the business of selling
duty-free goods, "Street Prices" shall mean the price regularly charged by the
concession operator or other similar concession operator for the same or similar
duty-free item at other major airports serving large urban areas in the
Northeast region of the United States, including but not limited to the Airport.
(2) Notices in form and substance reasonably satisfactory to the
Port Authority shall be conspicuously displayed in each concession operator's
space to the effect that the concession operator adheres to the foregoing
"Street Pricing" policy.
(g) (1) Each Port Authority agreement with a concession operator, and
each agreement under Alternatives 1, 2, 3 and 4, shall also provide, that the
concession operator and/or Concession Manager, and/or other third party, and/or
Lessee, as the case may be, shall:
(i) use its best efforts in every proper manner to develop
and increase the business conducted by it under the aforedescribed consumer
services agreement ;
(ii) not divert, or cause or allow to be diverted, any
business from the Premises or the Airport;
(iii) maintain, in English and accordance with accepted
accounting practice, during the term of the applicable agreement and for one (1)
year after the expiration or earlier termination or surrender thereof, and for a
further period extending until receipt of written permission from the Port
Authority to do otherwise, full and complete records and books of account
recording all transactions of the concession operator at, through, or in any way
connected with its operations at the Premises or elsewhere at the Airport, and
outside the Airport if the order therefor is received at the Airport, which
records and books of account shall be kept at all times within the Port of New
York District and shall separately state and identify each activity performed at
the Airport and off the Airport if the order therefor is received at the
Airport, provided, however, on the condition that the Lessee shall comply with
all of the terms and conditions of subparagraph (2)(ii) of this paragraph (g),
the Lessee may maintain said books and records and make them available to the
Port Authority at the Lessee's office located at ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇;
(iv) the concession operator shall cause any of its
Affiliates which performs services similar to those performed by the concession
operator to maintain, in English and accordance with accepted accounting
practice, during the term of the relevant consumer service agreement and for one
(1) year after the expiration or earlier termination or surrender thereof, and
for a further period extending until the concession operator shall receive
written permission from the Port Authority to do otherwise, full and complete
records and books
238
of account recording all transactions of each such Affiliate at, through, or in
any way connected with its operations at the Premises or elsewhere at the
Airport, and outside the Airport if the order therefor is received at the
Airport, which records and books of account shall be kept at all times within
the Port of New York District and shall separately state and identify each
activity performed at the Airport and off the Airport if the order therefor is
received at the Airport;
(v) permit and/or cause to be permitted in ordinary business
hours during the term of the aforedescribed consumer services agreement and for
one (1) year thereafter, and during such further period as is mentioned in the
preceding subparagraphs (1)(iii) and (1)(iv), the examination and audit by the
officers, employees and representatives of both the Port Authority and those of
the Lessee of such records and books of account and also any records and books
of account of any Affiliate if said Affiliate performs services similar to those
performed by the concession operator anywhere in the Port of New York District
(including without limitation all corporate records and books of account which
the Port Authority in its sole discretion believes may be relevant for the
identification, determination or calculation of all fees, rentals and other
amounts paid or payable to the Port Authority, all agreements, and all source
documents), within twenty (20) days following any request by the Port Authority
from time to time and at any time to examine and audit said books and records;
(vi) install and use such cash registers, sales slips,
invoicing machines and any other equipment and devices, including without
limitation computerized record-keeping systems, for recording orders taken, or
services rendered, as may be appropriate to the concession operator's business
and necessary or desirable to keep accurate books and records as aforesaid, and
without limiting the generality of the foregoing, for any activity involving
cash sales, install and use cash registers or other electronic cash control
equipment that provides for non-resettable totals;
(vii) in those situations where the books and records have
been generated from computerized data (whether mainframe, minicomputer, or
PC-BASED computer systems), provide, or cause to be provided, to the Port
Authority's representative extracts of data files in a computer readable format
on data disks, E-mail with attached files or alternative computer data exchange
formats suitable to the Port Authority in its sole discretion.
(viii) permit the inspection by the officers, employees and
representatives of the Port Authority and those of the Lessee of any equipment
used by the concession operator including, but not limited to, any of the
equipment described in subparagraph (1)(vi) above; and
(ix) furnish good, prompt and efficient service hereunder,
adequate to meet all demands therefor at the Premises; ▇▇▇▇▇▇▇ said service on a
fair, equal and non-discriminatory basis to all users thereof; and charge fair,
reasonable and non-discriminatory prices for each unit of sale or service,
provided, however, that the concession operator may make reasonable and
non-discriminatory discounts, rebates or other similar types of price reductions
to volume purchasers.
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(2) Without implying any limitation on the right of the Port
Authority to revoke its agreement with a concession operator, or Concession
Manager, other third party (under Alternative 3), or Lessee (under Alternative
4), as the case may be), in the event of the failure of the concession operator
(or Concession Manager, other third party or Lessee (under Alternative 4), as
the case may be) to maintain, keep within the Port District or make available
for examination and audit the required books and records in the manner and at
the times or location as provided in paragraph (g)(1) above then, in addition to
all and without limiting any other rights and remedies of the Port Authority,
the Port Authority may:
(i) Estimate the Gross Receipts of the concession operator
on any basis that the Port Authority, in its sole discretion, shall deem
appropriate, such estimation to be final and binding on the concession operator
and the concession operator's fees based thereon to be payable to the Port
Authority when billed; or
(ii) If any such books and records have been maintained
outside of the Port District, but within the Continental United States then the
Port Authority in its sole discretion may (A) require such books and records to
be produced within the Port District or (B) examine such books and records at
the location at which they have been maintained and in such event the concession
operator shall pay to the Port Authority when billed all travel costs and
related expenses, as determined by the Port Authority for Port Authority
auditors and other representatives, employees and officers in connection with
such examination and audit, or
(iii) If any such books and records have been maintained
outside the continental United States then, in addition to the costs specified
in subparagraph (2)(ii) above, the concession operator shall pay to the Port
Authority when billed all other costs of the examination and audit of such books
and records including without limitation salaries, benefits, travel costs and
related expenses, overhead costs and fees and charges of third party auditors
retained by the Port Authority for the purpose of conducting such audit and
examination.
(3) The foregoing auditing costs, expenses and amounts set forth
in subparagraphs (2)(ii) and (2)(iii) of this paragraph (g) shall be deemed fees
and charges under the Port Authority's consumer services agreement payable to
the Port Authority with the same force and effect as all other fees and charges
thereunder.
(4) The requirements of paragraphs (e) and (f) above and this
paragraph (g) shall apply fully to the Lessee under Alternative 4 as if the
Lessee was a concession operator, and similarly apply fully to a Concession
Manager or other third party as described herein.
(h) The Lessee shall employ or retain under Alternative 2 and
Alternative 4, or cause to be employed or retained under Alternative 1 and
Alternative 3, a full time trained professional staff at all times during the
term of the letting hereunder of sufficient size, expertise, ability,
suitability and experience to carry out its responsibilities under this Section.
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(i) On a continuing basis through the end of the term of the letting
hereunder, the Lessee shall undertake and execute through a variety of media, in
a manner acceptable to the Port Authority, such advertising and promotional
programs as shall bring to the attention of the public, generally, and actual
and potential enplaning passengers and their escorts and guests and the aviation
and tourist industries, in particular, the positive features of the consumer
services program managed, or caused to be managed, by the Lessee as provided in
this Lease and such other information to be presented in such style and format
as shall project, consistent with the truth, a desirable image of such consumer
services program, the Premises and the Airport. The Port Authority shall not
have any responsibility for, and shall not bear any of the costs of, the
foregoing.
(j) Without limiting the generality of the provisions of Sections 74
through 80 herein, the following shall apply with respect to each of the
concessions described in said Sections:
(1) The Lessee agrees that it will furnish to the concession
operator sufficient and suitable space within the Premises to carry on any
operation as may be required of or desired by the Lessee.
(2) The Lessee shall bring to the perimeter of the space to be
occupied by the concession operator, and shall install, the necessary pipes,
wires and conduits (including to any food service area), for the supply of
electricity and HVAC for such operations (including but not limited to
electricity to machines and displays with respect to permitted vending machines,
public telephones, advertising displays and insurance counters), all without
charge to the concession operator or the Port Authority, except for electricity
to the Restaurant Operator (as herein defined) which may be charged to the third
party operator at cost. With respect to any Restaurant Operator, the Lessee
shall also provide and install pipes, wires and conduits for the supply of gas
and water together with necessary steam and waste lines for use in connection
with the operation. The Lessee shall supply said utilities and services to the
concession operator, including to any storage areas provided to the concession
operator as required herein, and shall not charge the concession operator or the
Port Authority for any portion of same (except electricity to the Restaurant
Operator as aforesaid).
(3) Any agreement with a concession operator shall provide that
such concession operator shall furnish at its expense all necessary fixtures,
equipment, furniture and other personal property required in connection with the
operation and all construction work necessary to accommodate such installations,
except that, under Alternative 3, the Lessee reserves the right to assume the
cost and expense for all or part of the aforesaid personal property. With
respect to in-line spaces, the agreement shall also provide that the concession
operator will perform all work necessary or required to finish off the space,
including the finishing of the floors and ceilings from the structural slab and
the walls from the rough partitions, the decor and color scheme of the
concession area and the facilities and fixtures therein as well as the location
of fixtures thereon, which shall be subject to the approval of the Lessee and
compliance with the Port Authority Tenant Construction or Alteration Application
process.
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(4) If the Lessee desires to have a Person or entity conduct such
operations other than the Port Authority's proposed concession operator, except
for goods and services which constitute Reserved Uses, the Lessee may employ any
other Person of its choice (which other Person may not be the Lessee or an
Affiliate thereof unless the same is specifically consented to in writing by the
Port Authority) to do so, provided, however, such other Person first obtains a
permit from the Port Authority authorizing such Person to operate the
establishment in a portion or portions of the Premises as designated by the
Lessee with the prior approval of the Port Authority. Prior to the issuance of
any such permit by the Port Authority, such Person may be required to submit to
the Port Authority evidence satisfactory to the Port Authority of its
qualifications, the scope of its proposed operations and the standards of
service it will provide. Any such permit shall provide that such concession
operator will conduct its operations thereunder in a first-class manner in
accordance with the best practices in the industry and shall comply with the
maximum Port Authority standards with respect to service, health, sanitary and
safety measures. Paragraph (k)(2)(vi) of this Section shall apply with respect
to any inconsistency between the terms of the permit and the terms of the
agreement between the Lessee and the concession operator. Without limiting the
foregoing, prior to the issuance of the permit the Port Authority shall make a
copy of the same available to the Lessee and, upon the execution of the permit
by the proposed concession operator, the same shall be consented to in writing
by the Lessee. Such other Person shall be required to pay to the Port Authority
a fee but such fee shall not in any event exceed the fees or charges that would
be retained by the Port Authority if such establishment were operated by a
regular concession operator of the Port Authority. The Port Authority permit
described in this Paragraph (j)(4) will not be revoked without cause by the Port
Authority, without the prior consent of the Lessee. The preceding sentence is
intended to apply with respect to individual concession operators agreements,
and nothing in the preceding sentence shall mean or imply, or be deemed to mean
or imply, that the Lessee's consent shall be required for the Port Authority to
revoke its permit with, or other agreement containing its consent to, a
Concession Manager (or other concession manager under Alternative 3), or an
agreement entered into pursuant to Alternative 4, and such ▇▇▇▇▇▇'s consent
shall not be required in any of such circumstances.
(5) The contract between a concession operator and the Port
Authority, or the permit between the concession operator and the Port Authority
where such concession operator has entered into an agreement with the Lessee in
accordance with this Lease, shall contain appropriate provisions permitting
cancellation of such contract on short notice with and without cause. The
Lessee's agreement with the concession operator shall contain appropriate
provisions permitting cancellation of such contract on short notice with and
without cause. In the event of such cancellation without cause by the Port
Authority (consistent with the penultimate sentence of subparagraph (4) above
regarding the prior consent of the Lessee, it being understood that the same
excepts goods and services which constitute Reserved Uses) or the Lessee, as the
case may be, the Lessee agrees (and its agreement with the concession operator
shall provide that the Lessee agrees) to reimburse the concession operator for
its unamortized investment in the interior finishes and trade fixtures and title
to such trade fixtures shall thereupon vest in the Lessee; provided, however,
where such agreement is canceled expressly on the basis of the failure of the
concession operator to keep, perform or observe any of the terms and provisions
of said agreement on its part to be kept, performed or observed or on the basis
of
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one or more event or events of default as specified in said agreement such
provision for Lessee reimbursement shall not obtain or apply.
(k) Concession Managers:
(1) In connection with Alternative 1 and/or Alternative 3,
throughout the term of the letting hereunder, the Lessee may request Port
Authority approval to employ at the Premises, at ▇▇▇▇▇▇'s sole cost and expense,
on a full-time basis, a concession manager, subject in all respects to the terms
and conditions of this Section 73. Any fee or other compensation to be paid to
said concession manager shall be paid by the Lessee directly or out of revenues
derived by the Lessee from consumer services, and no portion of such fee or
compensation shall be paid out of the Port Authority's share of revenue from
consumer services or shall offset, reduce, be credited against or otherwise
adversely affect the amount of any fees, rent or other revenue to be paid or
payable to the Port Authority under this Lease or to which the Port Authority
may be otherwise entitled. Nor shall the Lessee (or a concession manager under
Alternative 1 or Alternative 3) be entitled to impose charges on concession
operators, whether in the form of key money, chargebacks or otherwise, or to
pass along or recoup the aforesaid fee or other compensation to be paid to said
concession manager, without the prior written consent of the Port Authority.
Notwithstanding references in this Paragraph (k) to Concession Manager, this
Paragraph (k) shall apply to both a Concession Manager as well as to any third
party which may manage concessions pursuant to Alternative 3.
(2) Any concession manager agreement between the Lessee and a
proposed Concession Manager shall state among other things, and the Lessee
agrees, that:
(i) said agreement is subject and subordinate to this Lease
(as the same may be amended, supplemented or extended);
(ii) said agreement shall not take effect without the prior
written consent of the Port Authority thereto to be embodied in the contractual
agreement referred to above (executed by and among the Port Authority, the
Lessee and the Concession Manager);
(iii) any amendment, supplement or extension of the said
agreement which does not have the express written approval of the Port Authority
shall be void ab initio and of no effect whatsoever; that if this Lease is
terminated on any account prior to the expiration of the term of the said
agreement then the said agreement shall terminate simultaneously with such
termination of this Lease unless the Port Authority shall notify the Concession
Manager and the Lessee at or prior to such effective date of termination of this
Lease that the Port Authority shall and does assume the rights and obligations
of the Lessee thereunder from and after such effective date of termination, it
being understood that the Port Authority shall have the right, but not the
obligation, to be assigned and to assume the Lessee's rights and obligations
under the concession manager agreement and, further, it being understood that
the Port Authority shall have no obligation to enter into any form of
non-disturbance or recognition agreement with any concession operator;
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(iv) the Port Authority shall have the right to revoke its
consent, or terminate any agreement containing its consent, to the concession
manager agreement at any time without cause on thirty (30) days' prior notice
and such revocation or termination shall not require the concurrence of the
Lessee;
(v) all fees, rent and other moneys due and payable to the
Port Authority and the Lessee (whether such amounts are paid or payable by the
Concession Manager as an operator at the Premises, or are collected or to be
collected from the concession operators which amounts in turn shall be based on
fees and rent paid or payable by the concession operators at the Premises) shall
be held by the Concession Manager without deduction, credit or offset for
arrearages and shall be held by it solely as described in this subparagraph and
thereafter remitted by the Concession Manager on a monthly basis directly to the
Port Authority and the Lessee. Said Concession Manager is deemed a collection
agent of the funds for the Port Authority and the Lessee to the extent of its
interest and the Concession Manager has no ownership or possessory interest in
such funds, which would otherwise be paid directly to the Port Authority and the
Lessee, other than as a trustee for the Port Authority to the extent of its
interest. In accordance with the foregoing capacity as collection agent: (1) the
Concession Manager shall be deemed, and shall hold itself out as, a fiduciary
vis-a-vis the Port Authority and the Lessee, (2) the Concession Manager shall
hold all revenues received by, from or on behalf of concession operator or
operations, as the case may be, in a separate account established in trust for
the Port Authority and the Lessee in which the Concession Manager must not
commingle such rent, fees and other moneys with any other funds, at an
institution acceptable to the Port Authority having an office in the Port of New
York District and qualified to do business in the State of New York, (3)
Concession Manager shall obtain additional protections on behalf of the Port
Authority and the Lessee providing for access by the Port Authority and the
Lessee to the revenues on deposit in such account (to the extent of its
interest) in the event of insolvency, appointment of a receiver, bankruptcy or
creditors' liens affecting the Concession Manager, (4) the Concession Manager
shall obtain insurance protecting against employee dishonesty, embezzlement,
theft, and the like in amounts and otherwise in a form acceptable to the Port
Authority, and naming the Port Authority and the Lessee as additional loss payee
thereunder, (5) the Concession Manager's fees to be paid by the Lessee may not
be withheld at any time by the Concession Manager from the rentals, fees and
other moneys due to the Port Authority, and (6) the Concession Manager shall
comply with any other requirements of the Port Authority and any other
reasonable requirements of the Lessee.
(vi) in the event of any inconsistency between the
concession manager agreement and this Lease, or between any retail sublease or
retail license (the terms retail "sublease" and retail "license" being used
interchangeably for purposes of Section 73 through Section 80, and the terms
retail "sublessee", "licensee" and "concession operator", being used
interchangeably for purposes of Section 73 through Section 80) and this Lease,
or between the Concession Manager agreement and the agreement containing the
Port Authority consent thereto, or between a retail sublease and the agreement
containing the Port Authority consent thereto, then in each and every such
instance the Lease or the Port Authority consent agreement, as the case may be,
shall supercede and control.
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(vii) Any and all monthly and annual reports which set forth
Gross Receipts (as defined herein, it being understood that the term Operator in
such definition shall mean concession operator (whether a sublessee, licensee,
concession operator or otherwise) for purposes of Sections 73 to 82), in the
aggregate and on a concession operator-by-concession operator basis, shall be
provided simultaneously directly to each of the Port Authority and the Lessee
(except not to the Lessee under Alternative 4). The Lessee shall provide, or
shall cause to be provided, to the Port Authority the following: (1) on or
before the twentieth (20th) day of each month following the commencement date of
any consumer service operation a statement, certified by an authorized officer
of the concession operator, of Gross Receipts arising out of operations of the
concession operator under its consumer service agreement for the preceding
month, and (2) on or before April 15 of each calendar year during the term of
the consumer service agreement a statement of Gross Receipts arising out of the
operations of the concession operator for the preceding year certified, at the
concession operator's sole expense, by a certified public accountant. It is
acknowledged that under Alternative 4, only the Lessee's Gross Receipts arising
out of or relating to the consumer service program at the Premises (as opposed
to the Lessee's aircraft operations) shall be the subject of monthly and annual
reports.
(3) Any Concession Manager shall have sufficient authority and
support, staff and appropriate equipment, supplies and means to manage and
administer those consumer service agreements and other agreements with the
concession operators and other entities to which the Lessee is a party, or by
which it is bound, relating to the consumer services program at the Premises, to
monitor and compel performance by all concession operator and other entities and
to serve as on-site liaison with the Port Authority. Said Concession Manager
shall have the power and authority on behalf of the Lessee to resolve all
operational issues concerning the consumer services program at the Premises but
shall have no power or authority to amend or modify this Lease or any agreement
embodying a Port Authority consent. In all events, an employee of the Lessee
with managerial authority shall be available for a minimum time span of sixteen
(16) hours each day during concession operation hours to meet with Port
Authority representatives in person at the Premises and available at other times
by telephone, with the ability in an emergency situation relating to retail
concession matters to arrive at the Airport by car within two hours after being
called.
(4) Neither a Concession Manager nor any Affiliate thereof shall
conduct or have any interest whatsoever in any entity conducting a consumer
service operation in any Concession Area, unless the Port Authority has
explicitly approved in writing specific exceptions after having been furnished
such information as it may require and subject to such qualifications,
conditions, limitations and restrictions as part of any such approval; provided,
however, Alternative 3 contemplates that a concession manager may both manage
and operate consumer service operations at the Premises and Alternative 4
contemplates that the Lessee would both manage and operate consumer service
operations at the Premises.
(5) The Lessee shall not knowingly either employ or permit the
employment of any management, supervisory or other personnel of the Lessee
(including but not limited to such Concession Manager or any contractor or
subcontractor, representative or agent of the Lessee), whose employment
constitutes a conflict of interest or whose actions are inconsistent with the
highest level of honesty, ethical conduct or public trust or are adverse to the
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public interest. Notwithstanding the foregoing, the Lessee shall be under no
obligation to refrain from hiring any Person if to do so would be a violation of
law, or to terminate any Person if to do so would be a violation of law or of
any applicable right of such Person, contractual or otherwise.
(6) Any agreement entered into between the Lessee and the Port
Authority to implement Alternative 4 shall contain no lower standards or lesser
requirements for the Lessee's performance than those described in this Paragraph
(k).
(l) Port Authority Fees:
The fees, rent and other consideration paid or payable to the
Port Authority under Alternatives 1, 2, 3 and 4 shall be specifically consented
to in all agreements entered into with the Port Authority, however without
limiting the generality of the foregoing, such amounts shall be based on Gross
Receipts (it being understood that pursuant to Alternative 4 the Gross Receipts
of the Lessee shall mean only those which arise out of or relate to the consumer
service operations at the Premises as opposed to its aircraft operations at the
Premises). Under all of Alternatives 1, 2, 3 and 4, the Port Authority shall be
paid no less than (1) twenty percent (20%) of the amounts paid or payable by
each concession operator with respect to food and beverage concessions (pursuant
to its agreement as consented to by the Port Authority) and (2) fifty percent
(50%) of the amounts paid or payable by each concession operator with respect to
all other consumer services (pursuant to its agreement as consented to by the
Port Authority), it being understood the Lessee shall be deemed to be the
concession operator under Alternative 4 and the specific fee/rental structure in
such instance shall be as consented to in the Lessee's written agreement with
the Port Authority. For purposes of this paragraph, concession operators shall
include Additional Operators described in Section 80 and any concession manager
under Alternative 3. Notwithstanding any specific references in Sections 74 and
76 to 80 to basic rent, percentage rent and fixed fees to be paid by concession
operators, the amounts paid or payable by the concession operator under its
agreement (and accordingly the fees, rent and other consideration which are the
subject of this subparagraph (l)) shall include, and be deemed to include,
without limitation, late fees and interest, liquidated damages, delinquency
amounts, fines, retail display allowances and other promotional incentives, and
the like, and shall exclude only rentals and fees which are strictly
pass-through charges for expenses actually incurred by the Lessee (and its
concession manager, if any); provided, however, that the Lessee (and its
concession manager, if any) shall be prohibited from imposing or adding an
administrative charge or other up-charge to such pass-through charges and
expenses.
(m) The Port Authority's permit or consent agreements with concession
operators shall provide, and the Lessee's agreements (or the Concession
Manager's agreements) with concession operators, shall provide, that a breach or
default by the concession operator in its obligations under one agreement shall
also constitute a breach or default by the concession operator of its
obligations under the other agreement. In the event of such breach or default,
the Lessee shall enforce the payment obligations of the concession operator on
behalf of the Lessee and the Port Authority, and exercise all necessary remedies
in connection therewith; provided, however, that the same shall not limit or
affect the rights of the Port Authority to enforce such payment obligations on
behalf of both the Port Authority and the Lessee, and the Port Authority
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shall not be obligated to incur any expense or to commence any legal proceeding
to enforce such payment obligations.
(n) The provisions of Sections 74 and 77 through 81 hereof shall be
understood in the context of Alternatives 1, 2, 3 and 4, defined in this
Section.
SECTION 74. RESTAURANT AND BAR
(a) (i) The Lessee shall select and thereafter enter into a contract
or agreement with one or more qualified restaurant operators (each such
restaurant operator being hereinafter referred to in this Section as the
"Restaurant Operator") authorizing the Restaurant Operator to operate in the
Premises facilities for the sale of food, alcoholic and non-alcoholic beverages
and similar items for consumption in the Premises, subject in all respects to
Section 73 hereof including, but not limited to, the requirement to obtain a
permit from the Port Authority authorizing such Restaurant Operator to operate a
restaurant service in a portion of the Premises hereunder.
(ii) The agreement between the Restaurant Operator and the Lessee
and the permit issued by the Port Authority may not call for any fixed rental or
fee.
(iii) The agreement between the Restaurant Operator and the
Lessee and the permit issued by the Port Authority to the Restaurant Operator
shall require the Restaurant Operator to pay a percentage fee based upon the
Gross Receipts of the Restaurant Operator from the sale of food, alcoholic and
non-alcoholic beverages, which fee shall be subject to the prior written
approval of the Port Authority. It is hereby understood and agreed that at least
20% of the percentage fee paid or payable by the Restaurant Operator shall be
paid to and retained by the Port Authority.
(iv) There shall be no other payments by the Restaurant Operator
to the Lessee except for appropriate payments for any electricity which may be
furnished to the Restaurant Operator by the Lessee.
(b) (i) The Lessee's agreement with the Restaurant Operator shall
provide that any breach or default by the Restaurant Operator under its permit
with the Port Authority shall also constitute a material event of default under
said agreement with the Lessee and, without limiting the generality of any other
provision of this Section, that in the event any of the terms, provisions,
covenants and conditions of the Lessee's agreement with the Restaurant Operator
shall be contrary to, or conflict or be inconsistent with, the terms,
provisions, covenants and conditions of the permit issued by the Port Authority,
the terms, provisions, covenants and conditions of the Port Authority Permit
shall be controlling, effective and determinative.
(ii) The Lessee's agreement with the Restaurant Operator shall
cover the arrangements for the space to be used in for restaurant service within
the Premises including the amount, type and location of the space.
(iii) The agreement between the Lessee and the Restaurant
Operator shall include provisions covering the arrangements set forth in this
Section.
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(c) In the event the Restaurant Operator selected by the Lessee to
provide food, alcoholic and non-alcoholic beverages and similar items for sale
and consumption on the Premises is the same concession operator providing
in-flight meals to the Lessee and is a wholly owned subsidiary of the Lessee,
the fees to be paid to the Port Authority shall apply only to the Gross Receipts
of the Restaurant Operator from the sale of food, alcoholic and non-alcoholic
beverages on the Premises.
SECTION 75. VENDING MACHINES, PUBLIC TELEPHONES, ADVERTISING DISPLAYS
(a) If requested by the Lessee the Port Authority, by itself or
through contractors, lessees, or permittees, shall install and maintain in the
Premises vending machines, public telephones, and/or advertising displays, at
such locations and to such extent as requested by the Lessee.
(b) The Port Authority shall require its contractors, lessees, or
permittees to pay a fee, which may be a percentage fee subject to a minimum
amount, based upon the Gross Receipts received from such vending machines,
public telephones, and advertising displays or a fixed fee.
(c) The Port Authority shall provide in its agreement for the Lessee
to be remitted an annual fee equivalent to fifty percent (50%) of the fee
payable by its advertising contractors, lessees, or permittees and the 50%
balance shall be paid to and retained by the Port Authority. No fees are to be
remitted to the Lessee relating to vending machines and public telephones.
SECTION 76. INSURANCE COVERING AIR TRANSPORTATION
(a) The Port Authority may enter into permits with qualified insurance
vendors requiring such vendors to sell or arrange for the sale, at the Premises,
of insurance covering air transportation, of such types and coverages as may be
required by the Lessee.
(b) (i) Both the agreement between the Lessee and the insurance vendor
and the permit to be issued by the Port Authority shall include provisions
covering the arrangements set forth in this Section including without limitation
that: (1) if the Lessee so requests, the vendor shall provide a general
information service to the public; and (2) the vendor shall not be required to
provide a counter for the sale of insurance if, in its opinion, there will be
insufficient patronage to support such a counter; and (3) the vendor shall not
be required to continue to provide at any designated location vending machines
for the sale of insurance when the gross premiums from any such machines at any
such location is less than $200 per month, provided, however, if twenty-four
(24) hour counter coverage is not provided there shall be at least one machine
in the Premises; and (4) the provisions of insurance policies and the minimum
coverage offered shall be acceptable to the Lessee.
(ii) The contract between the insurance vendor and the Port
Authority and between the insurance vendor and the Lessee shall provide that
such vendor shall pay a fixed basic rental for the space occupied by such vendor
in the Premises in connection with
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the sale of such insurance. The amount of the fixed basic rental to be paid by
the vendor shall be agreed upon between the Port Authority and the Lessee.
(iii) The contract and the permit shall further provide that
the vendor shall pay an amount equal to a percentage of the vendor's gross
premiums from the sale of such insurance, less the amount of any fixed basic
rental paid by the vendor. Fifty percent (50%) of the basic rental and
percentage fees payable by the insurance vendor shall be paid to and retained by
the Port Authority.
(iv) There shall be no payments by the insurance vendor to
the Lessee for any utilities which may be furnished to the insurance vendor by
the Lessee.
(c) The location of insurance counters and insurance vending machines
shall be determined by the Lessee subject to the approval of the Port Authority
and in accordance with the Lessee's comprehensive plan. The Lessee shall not
require unreasonably frequent moves of insurance counters and insurance vending
machines hereunder.
SECTION 77. NEWSSTANDS
(a) (i) The Lessee shall select and thereafter enter into an agreement
or agreements with a qualified newsstand operator or operators (each such
newsstand operator being hereinafter referred to in this Section as the
"Newsstand Operator") authorizing such operators to operate newsstands in the
Premises for the sale at retail of such of the following items as may be
approved by the Port Authority: newspapers, magazines, cigarettes, cigars and
other tobacco supplies, candy, chewing gum, playing cards and paper-bound books,
to the extent required by the Lessee, subject in all respects to Section 73
hereof including, but not limited to, the requirement to obtain a permit from
the Port Authority authorizing such Newsstand Operator to operate a newsstand
service in a portion of the Premises hereunder. The Port Authority shall require
such operator or operators to sell at retail from its or their locations, such
other items or furnish such other services as may be approved by the Port
Authority and as are requested by the Lessee.
(ii) The agreement between the Newsstand Operator and the Lessee
and the permit issued by the Port Authority to the Newsstand Operator shall
require the Newsstand Operator(s) to pay a fixed basic rental for the space
occupied by such Newsstand Operator in the Premises in connection with the
operation of the newsstand. The amount of the fixed basic rental to be paid by
the Newsstand Operator(s) shall be agreed upon between the Port Authority and
the Lessee.
(iii) The agreement and permit with the Newsstand Operator(s)
shall further require the Newsstand Operator to pay a percentage fee of the
Gross Receipts derived by the Newsstand Operator from all sales made by the
Newsstand Operator less the amount of the basic rental paid by the Newsstand
Operator. Fifty percent (50%) of the basic rental and percentage fees payable by
the Newsstand Operator shall be paid to and retained by the Port Authority.
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(iv) The Lessee's agreement with the Newsstand Operator(s) shall
further provide that the Newsstand Operator will be permitted to sell at retail
only such merchandise as is normally sold at newsstands in operation at Port
Authority Airports. If there is a demand or need by travelers and other users of
the Premises for other merchandise and there is no other tenant, permittee or
licensee of the Port Authority available to provide such merchandise the scope
of the newsstand's operation may be increased; provided, however, that no
merchandise objectionable to the Lessee or the Port Authority shall be sold.
(v) There shall be no payments by the Newsstand Operator to the
Lessee for any utilities which may be furnished to the Newsstand Operator by the
Lessee.
(b) The agreement between the Lessee and the Newsstand Operator shall
include provisions covering the arrangements set forth in this Section.
(c) The Lessee's agreement with the Newsstand Operator shall provide
that any breach or default by the Newsstand Operator under its permit with the
Port Authority shall also constitute a material event of default under said
agreement with the Lessee and, without limiting the generality of any other
provision of this Section, that in the event any of the terms, provisions,
covenants and conditions of the Lessee's agreement with the Newsstand Operator
shall be contrary to, or conflict or be inconsistent with, the terms,
provisions, covenants and conditions of the permit issued by the Port Authority,
the terms, provisions, covenants and conditions of the Port Authority Permit
shall be controlling, effective and determinative.
(d) The Lessee agrees that it shall furnish to the Newsstand Operator
sufficient and suitable space for conducting and carrying on its aforesaid
operation. The Lessee shall furnish without additional charge, a reasonable
amount of storage space for the use of the Newsstand Operator. The location of
newsstands and appropriate storage space for the use of the Newsstand
Operator(s) shall be determined by the Lessee subject to the approval of the
Port Authority and in accordance with the Lessee's comprehensive plan.
SECTION 78. FOREIGN CURRENCY EXCHANGE
(a) (i) The Lessee shall select and thereafter enter into an agreement
or agreements with a qualified foreign currency exchange operator or operators
(which Person or entity is sometimes hereinafter referred to as the "Currency
Exchange Operator") providing for the Currency Exchange Operator to operate an
establishment in the Premises for the exchange, purchase and sale of domestic
and foreign currencies (hereinafter called the "Foreign Currency Exchange
Service"), subject in all respects to Section 73 hereof including, but not
limited to, the requirement to obtain a permit from the Port Authority
authorizing such Currency Exchange Operator to operate a Foreign Currency
Exchange Service.
(ii) The agreement between the Currency Exchange Operator and the
Lessee and the permit issued by the Port Authority to the Currency Exchange
Operator shall not call for any fixed rental or fee.
(iii) The agreement and permit with the Currency Exchange
Operator shall further require the Currency Exchange Operator to pay a
percentage fee of the Gross
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Receipts derived by the Currency Exchange Operator from all sales made by the
Currency Exchange Operator. Fifty percent (50%) of the percentage fees payable
by the Currency Exchange Operator shall be paid to and retained by the Port
Authority.
(iv) There shall be no payments by the Currency Exchange
Operator to the Lessee for any utilities which may be furnished to the Currency
Operator by the Lessee.
(b) The agreement between the Lessee and the Currency Exchange
Operator shall include provisions covering the arrangements set forth in this
Section.
(c) The Lessee's agreement with the Currency Exchange Operator shall
provide that any breach or default by the Currency Exchange Operator under its
permit with the Port Authority shall also constitute a material event of default
under said agreement with the Lessee and, without limiting the generality of any
other provision of this Section, that in the event any of the terms, provisions,
covenants and conditions of the Lessee's agreement with the Currency Exchange
Operator shall be contrary to, or conflict or be inconsistent with, the terms,
provisions, covenants and conditions of the permit issued by the Port Authority,
the terms, provisions, covenants and conditions of the Port Authority Permit
shall be controlling, effective and determinative.
(d) The Lessee agrees that it shall furnish to the Currency Exchange
Operator sufficient and suitable space for conducting and carrying on its
aforesaid operation.
SECTION 79. RETAIL BANKING
(a) (i) The Lessee shall select and thereafter enter into an agreement
or agreement with a qualified retail banking operator or operators (which Person
or entity is sometimes hereinafter referred to as the "Retail Bank Operator")
providing for such Retail Bank Operator to operate a service, within Concession
Areas, performing one or more of the following functions as agreed between them:
the maintaining of accounts, receipt and/or disbursement of funds and including
automatic teller machine service and foreign currency exchange (hereinafter
called the "Retail Banking Service"), subject in all respects to Section 73
hereof including, but not limited to, the requirement to obtain a permit from
the Port Authority authorizing such Retail Bank Operator to operate a Retail
Banking Service.
(ii) The agreement between the Retail Bank Operator and the
Lessee and the permit issued by the Port Authority to the Retail Bank Operator
shall require the Retail Bank Operator to pay a fixed rental for the space
occupied by such Retail Bank Operator in the Premises in connection with the
operation of the Retail Banking Service. The amount of the fixed rental to be
paid by the Retail Bank Operator shall be agreed upon between the Port Authority
and the Lessee. Fifty percent (50%) of such fix rental payable by the Retail
Bank Operator shall be paid to and retained by the Port Authority.
(iii) There shall be no payments by the Retail Bank Operator to
the Lessee for any utilities which may be furnished to the Retail Bank Operator
by the Lessee.
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(b) The agreement between the Lessee and the Retail Bank Operator
shall include provisions covering the arrangements set forth in this Section.
(c) The Lessee's agreement with the Retail Bank Operator shall provide
that any breach or default by the Retail Bank Operator under its permit with the
Port Authority shall also constitute a material event of default under its
agreement with the Lessee and, without limiting the generality of any other
provision of this Section, that in the event any of the terms, provisions,
covenants and conditions of the Lessee's agreement with the Retail Bank Operator
shall be contrary to, or conflict or be inconsistent with, the terms,
provisions, covenants and conditions of the permit issued by the Port Authority,
the terms, provisions, covenants and conditions of the Port Authority Permit
shall be controlling, effective and determinative.
(d) The Lessee agrees that it shall furnish to the Retail Bank
Operator sufficient and suitable space for conducting and carrying on its
aforesaid operation.
SECTION 80. OTHER CONSUMER SERVICES
(a) If the Lessee requests that additional consumer services be
provided in the Premises for the sale of other items or the furnishing of other
services, the Lessee shall either (i) request that the Port Authority secure
qualified tenants, permittees or licensees (hereinafter each referred to as the
"Additional Operator"), to furnish such consumer services and the Port Authority
shall endeavor to secure such Additional Operator and to enter into contracts or
agreements with such Additional Operator requiring it to furnish the item or
services to the extent required by the Lessee, or (ii) notify the Port Authority
in writing that the Lessee is seeking such Additional Operator (including the
proposed contractual arrangements, if any, between the Lessee and the proposed
Additional Operator), satisfactory to the Port Authority and subject to its
approval, provided that the Lessee complies with all the terms and provisions of
Section 73 hereof, including without limitation its prior submittal to the Port
Authority of an updated comprehensive plan for consumer services covering such
proposed Additional Operator in accordance with and subject to said Section 73,
and in compliance with the provisions covering the selection of the Additional
Operator as described in Sections 73 (c) and 73(j) hereof and also subject to
Sections 64, 81 and 82 hereof.
(b) Each such Additional Operator must enter into an appropriate
contractual arrangement with the Port Authority, as described in Sections 73(c)
and 73(j) hereof, including without limitation an appropriate Port Authority
permit authorizing such Additional Operator to operate the consumer services at
the Premises.
(c) (i) The agreement between the Additional Operator and the Lessee
and the permit issued by the Port Authority to the Additional Operator shall
require the Additional Operator(s) to pay a fixed basic rental for the space
occupied by such Additional Operator in the Premises in connection with the
furnishing of consumer services. The amount of the fixed basic rental to be paid
by the Additional Operator(s) shall be agreed upon between the Port Authority
and the Lessee.
(ii) The agreement and permit with the Additional
Operator(s) shall further require the Additional Operator to pay a percentage
fee based upon the Gross
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Receipts derived by the Additional Operator from the operation of such consumer
service, less the amount of the basic rental paid by the Additional Operator.
Fifty percent (50%) of the basic rental and percentage fees payable by the
Additional Operator shall be paid to and retained by the Port Authority.
(iii) There shall be no payments by the Additional Operator
to the Lessee for any utilities which may be furnished to the insurance vendor
by the Lessee.
(d) The agreement between the Lessee and the Additional Operator shall
include provisions covering the arrangements set forth in this Section.
(e) The Lessee's agreement with the Additional Operator shall provide
that any breach or default by the Additional Operator under its permit with the
Port Authority shall also constitute a material event of default under said
agreement with the Lessee and, without limiting the generality of any other
provision of this Section, that in the event any of the terms, provisions,
covenants and conditions of the Lessee's agreement with the Additional Operator
shall be contrary to, or conflict or be inconsistent with, the terms,
provisions, covenants and conditions of the permit issued by the Port Authority,
the terms, provisions, covenants and conditions of the Port Authority permit
shall be controlling, effective and determinative.
(f) Notwithstanding the foregoing provisions of paragraphs (a), (b)
and (c) above, the contract between the Port Authority and the Additional
Operator may provide that the Additional Operator will pay to each of the Port
Authority and the Lessee a basic minimum rental plus a percentage of Gross
Receipts (with or without an annual exemption amount) to be shared equally
between the Port Authority and the Lessee and will also pay to the Lessee an
equal amount as such basic minimum rental, with such payments of the basic
minimum rental and percentage fee to be made by the Additional Operator directly
to the Port Authority and directly to the Lessee.
(g) The Additional Operator will furnish and install at its expense
all necessary fixtures, stands, counters and equipment required in connection
with its operation and all construction work necessary to accommodate such
installations.
(h) The Port Authority may require the contract with the Additional
Operator to include limitations as to the scope of the activities of such
Additional Operator in light of the availability of similar services in the
concession area or Premises.
(i) The Lessee understands and agrees that it may not itself nor will
the Port Authority install or cause to be installed coin-operated lockers on the
Premises.
SECTION 81. SUBLETTING OF THE PREMISES FOR CONSUMER SERVICES
(a) Irrespective of whether the Persons selected in accordance with
this Agreement to furnish the consumer services set forth in Sections 74, 75,
76, 77, 78, 79, and 80 hereof have contracts with or are contractors or
permittees of the Port Authority, the Lessee may require that such Persons enter
into separate agreements or subleases with the Lessee as a condition precedent
to the occupancy of space within and the operation of such establishments
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upon the Premises, provided, however, that all such Persons must have first
obtained a permit from the Port Authority authorizing them to operate such
establishments. The terms and provisions of the said agreements or subleases
shall not be inconsistent with the terms of this Agreement except that the same
may provide for cancellation by the Lessee on short notice in the event the
services furnished by such Persons are unsatisfactory to the Lessee.
(b) Section 73(j) shall fully apply with respect to subleases and
other agreements entered into between the Lessee and a Person pursuant to this
Section, including but not limited to the requirement of such Persons to pay to
the Port Authority a fee, with such fee not in any event to exceed the fees or
charges that would be retained by the Port Authority if their respective
establishments were operated by regular concession operators of the Port
Authority.
SECTION 82. OBLIGATIONS IN CONNECTION WITH CONSUMER SERVICES AGREEMENTS
The Port Authority shall administer all contracts and agreements with
its tenants, licensees or permittees furnishing consumer services at the
Premises. The Port Authority does not guarantee the payments of rentals and fees
required to be paid by the tenant, licensee, permittee, concession operator or
operator pursuant to the provisions of Sections 74, 75, 76, 77, 78, 79 and 80
hereof and shall have no obligation to the Lessee to make any payments to the
Lessee under any circumstances. Each of the Port Authority and the Lessee, with
respect to its own contracts and agreements for consumer services at the
Premises, if so requested by the other party, will advise the other party of all
accounts remaining delinquent for more than sixty (60) days and will consult
with the other party as to the appropriate steps to effect collection. A default
by the Port Authority in observing the provisions of the preceding sentence
shall not result in the imposition of any liability on the Port Authority with
respect to the Lessee.
SECTION 83. TERMINATION BY THE LESSEE
(a) If any one or more of the following events shall occur:
(1) If the Lessee shall be prevented from operating its air
transportation system to and from the Airport by reason of its inability to use
a substantial part of all of the Runways and Taxiways,
(i) for a period of longer than thirty (30) consecutive
days, resulting from any condition of the Airport not due to the fault of the
Lessee; or
(ii) for a period of longer than ninety (90) consecutive
days, resulting from a permanent injunction issued by any court of competent
jurisdiction; or
(iii) for a period of longer than ninety (90) consecutive
days, resulting from any order, rule or regulation of the Federal Aviation
Administration, or other governmental agency having jurisdiction over the
operations of the Lessee with which the Lessee is unable to comply at reasonable
cost or expense; or
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(2) The Port Authority shall fail to perform any of its
obligations under this Lease within twenty (20) days after receipt of notice of
default thereunder from the Lessee (except where fulfillment of its obligation
requires activity over a period of time and the Port Authority shall commence to
perform whatever may be required for fulfillment within twenty (20) days after
the receipt of notice and continues such performance without interruption,
except for causes beyond its control);
then upon the occurrence of any such event or at any time thereafter during the
continuance of the condition, the Lessee may by twenty (20) days' notice
terminate the letting, such termination to be effective upon the date set forth
in such notice and to have the same effect as if the term of the letting had on
that date expired. No waiver by the Lessee of any default on the part of the
Port Authority in performance of any of the terms, covenants or conditions
hereof to be performed, kept or observed by the Port Authority shall be or be
construed to be a waiver by the Lessee of any other or subsequent default in
performance of any of the said terms, covenants and conditions.
(b) The payment of rentals by the Lessee for the period or periods
after the Lessee shall have a right to terminate under this Section but before
any such default of the Port Authority has been cured, shall not be or be
construed to be a waiver by the Lessee of any such right of termination.
(c) The rights of termination described above shall be in addition to
any other rights of termination provided in this Agreement and in addition to
any rights and remedies that the Lessee would have at law or in equity
consequent upon any breach of this Agreement by the Port Authority, and the
exercise by the Lessee of any right of termination shall be without prejudice to
any other such rights and remedies.
SECTION 84. MEMORANDUM OF AGREEMENT
(a) The Lessee agrees that it shall, subject to the terms and
conditions of Section 33 hereof, install, operate and maintain at its sole cost
and expense a minimum of two (2) electronic ticketing kiosks in Building No. 60
upon notice to do so from the Port Authority at such locations as shall be set
forth in such notice and shall monitor the usage of such kiosks, all in
compliance with the MOA. Further, the Lessee shall provide public access between
the Premises and Building No. 60 through the Flight Wing I Tube and the Flight
Wing II Tube during such hours as shall be required by the Port Authority in its
sole discretion including without limitation all appropriate signing as required
by the Port Authority and the MOA. The Lessee shall operate and maintain all
equipment and utilities serving the Flight Wing 1 Tube that it installed as part
of the Redevelopment Work, the access doors to the vestibules in which the
Flight Wing 1 Tube and the Flight Wing II Tube terminate, and all vertical
circulation equipment providing access to the Flight Wing I Tube and the Flight
Wing II Tube.
(b) The Lessee shall cooperate and coordinate with the Port Authority
in the Port Authority's compliance with the MOA as such compliance pertains and
relates to the Redevelopment Work, the Premises and the Lessee's operations
thereat and further the Lessee shall cooperate and coordinate with any Person
that is leasing, using, operating, restoring or occupying Building No. 60 with
the permission of the Port Authority in providing access to and
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from the Premises and the Flight Wing Tubes, the installation, operation and
maintenance of the kiosks referred to in paragraph (a) of this Section.
(c) Notwithstanding anything to the contrary elsewhere in this Lease,
including without limitation Section 10 hereof, the Lessee shall maintain any
portions of Building No. 60, including without limitation the "trumpets", that
are incorporated into the New Passenger Terminal (the "Historic Elements") in
good condition and as required by the MOA and any governmental requirement, law,
rule or regulation, such as, but not limited to, preparing maintenance and
preservation guidelines for the treatment of the Historic Elements. The
guidelines shall address the replacement and repair of the Historic Elements,
on-going maintenance and cleaning. The guidelines shall prescribe periodic
inspections and maintenance of the Historic Elements on a five-year cycle. The
guidelines shall be submitted to the Port Authority for review and approval
promptly following the Terminal Work Completion Date. Further, after the
Terminal Work Completion Date, the Lessee shall perform an inspection of the
Historic Elements every five years in accordance with the foregoing maintenance
and preservation guidelines as approved by the Port Authority and submit a
certified copy of the report to the Port Authority for approval. The inspection
shall be conducted by an architect or engineer experienced in the restoration of
historic structures.
SECTION 85. NO WAIVER BY THE LESSEE
No failure by the Lessee to insist upon the strict performance of any
agreement, term, covenant or condition of the Lease or to exercise any right or
remedy consequent upon a breach or default thereof, and no extension, supplement
or amendment of the Lease during or after a breach thereof, unless expressly
stated to be a waiver, and no payment to the Port Authority of rentals, fees,
charges or other payments in whole or in part after or during the continuance of
any such breach or default, shall constitute a waiver of any such breach or
default of such agreement, term, covenant or condition. No agreement, term,
covenant or condition of the Lease to be performed or complied with by the Port
Authority, and no breach or default thereof, shall be waived, altered or
modified except by a written instrument executed by the Lessee. No waiver by the
Lessee of any default or breach on the part of the Port Authority in performance
of any agreement, term, covenant or condition of this Lease shall affect or
alter the Lease, but each and every agreement, term, covenant and condition
thereof shall continue in full force and effect with respect to any other then
existing or subsequent breach or default thereof.
SECTION 86. ROADS-NO RESTRICTION OF PORT AUTHORITY RIGHT
Neither the provisions of Section 2 hereof entitled "Construction by
the Lessee", nor the construction thereunder by the Lessee of any roadways
located off of the Premises nor any payment of costs thereof by the Lessee shall
prevent or restrict the right of the Port Authority to designate or to not
designate, at its sole discretion, such roadways as part of the Air Terminal
Highways, upon the Lessee's completion of the construction thereof, and to make
the same available to the general public for general or limited highway in
accordance with and subject to its policy or policies governing or which may
govern such matters.
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SECTION 87. PORT AUTHORITY PAYMENTS FOR THE COST OF THE REDEVELOPMENT WORK
(a) For the purposes of this Lease, the following terms shall have the
respective meanings provided below:
(1) "Allocable Elements of Work" shall mean the Airside Civil
Work, the Landside Civil Work, the Passenger Terminal Work, the Parking Garage
Work and the Terminal 5 AirTrain Connector Work.
(2) "Building No. 60 AirTrain Connector Work" shall mean the work
to plan, design, and construct an enclosed or covered connector from the
Terminal 5/6 AirTrain Station to Building No. 60 which meets the requirements of
the MOA as determined by the Port Authority.
(3) "Carrying Cost" shall mean an amount equal to the capitalized
"Financial Expense" of the Port Authority attributed to the Cost of the Lessee's
Redevelopment Work Elements as such Financial Expense is computed and recorded
by the Port Authority's accounting system.
(4) "Cost of the Airside Civil Work" shall mean the sum of the
following amounts, and such amounts only, actually paid or payable by the Lessee
to the extent that the inclusion of the same is permitted by generally accepted
accounting practices consistently applied (it being understood that the Cost of
the Airside Civil Work shall in no event include any of the Cost of the Lessee's
$80 Million Work or any of the Temporary Facilities Cost or any of the Lessee's
Shared Environmental Costs):
(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished, and materials and equipment actually furnished and
installed (except as otherwise approved by the Port Authority pursuant to
paragraph (m) of this Section) in connection with the Airside Civil Work
(all such amounts in this Item A being herein referred to as the "Airside
Civil Work Item A Costs"); and
(bb) Soft Costs directly charged or allocated to the Cost of
the Airside Civil Work pursuant to paragraph (k) of this Section; and
(cc) General Construction Costs directly charged or
allocated to the Cost of the Airside Civil Work pursuant to paragraph (l)
of this Section.
(5) "Cost of the Building No. 60 AirTrain Connector Work" shall
mean an amount equal to the actual costs of the Building No. 60 AirTrain
Connector Work as computed and recorded by the Port Authority's accounting
system including without limitation the lump sum amount for the Port Authority
Requested Change Order covering such work, or in the event the parties cannot
agree on the lump sum amount, the cost of the work as determined by time and
materials in an amount not to exceed an agreed upon maximum cost for the
Building No. 60 AirTrain Connector Work, provided, however, if the Cost of the
Building No. 60
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AirTrain Connector Work shall not have been determined on or prior to the Final
Payment Date, the Cost of the Building No. 60 AirTrain Connector Work shall mean
an amount equal to the sum of the actual costs of the Building No. 60 AirTrain
Connector Work as computed and recorded by the Port Authority's accounting
system as of the Final Payment Date and the cost estimate for the all or the
remainder of the Cost of the Building No. 60 AirTrain Connector Work, as the
case shall be, as determined by the Chief Engineer of the Port Authority. The
Port Authority shall provide to the Lessee the amount of the Cost of the
Building No. 60 AirTrain Connector Work if requested by the Lessee in a notice
given by the Lessee on or after the Final Payment Date, such estimate to be
provided by the Port Authority to the Lessee within ninety (90) days's after the
Port Authority's receipt of such notice.
(6) "Cost of the Landside Civil Work" shall mean the sum of the
following amounts, and such amounts only, actually paid or payable by the Lessee
to the extent that the inclusion of the same is permitted by generally accepted
accounting practices consistently applied (it being understood that the Cost of
the Landside Civil Work shall in no event include any of the Cost of the
Lessee's $80 Million Work or any of the Temporary Facilities Cost or any of the
Lessee's Shared Environmental Costs):
(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished and materials and equipment actually furnished and
installed (except as otherwise approved by the Port Authority pursuant to
paragraph (m) of this Section) in connection with the Landside Civil Work
(all such amounts in this Item (aa) being herein referred to as the
"Landside Civil Work Item A Costs"); and
(bb) Soft Costs directly charged or allocated to the Cost of
the Landside Civil Work pursuant to paragraph (k) of this Section; and
(cc) General Construction Costs directly charged or
allocated to the Cost of the Landside Civil Work pursuant to paragraph (l)
of this Section.
(7) "Cost of the Lessee's Redevelopment Work Elements" shall mean
an amount equal to the sum of the Cost of the Airside Civil Work, the Cost of
the Landside Civil Work, the Cost of the Parking Garage Work, the Cost of the
Passenger Terminal Work, the Cost of the Terminal 5 AirTrain Connector Work, the
Lessee's Shared Environmental Costs, the Lessee's Administrative Amount, the
Cost of Port Authority Construction Inspection, the Cost of Port Authority
Garage Materials Inspection and the Carrying Cost, provided, however, the Cost
of the Lessee's Redevelopment Work Elements shall in no event include any of the
Cost of the Lessee's $80 Million Work or any of the Temporary Facilities Cost.
(8) The "Cost of the MOA Curtain Wall Work" shall mean the lesser
of the amounts set forth in subparagraph (aa) below and the amounts set forth in
subparagraph (bb) below, and such amounts only, to the extent that the inclusion
of the same is permitted by generally accepted accounting practices consistently
applied (it being understood that the Cost of the MOA Curtain Wall Work shall in
no event include any of the Cost of the Lessee's $80 Million Work or any of the
Temporary Facilities Cost):
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(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished and materials and equipment actually furnished and
installed in connection with the construction of that portion of the facade
and curtain wall of the New Passenger Terminal which faces Building No. 60
in excess of $75.00 per square foot, but only if such excess costs are
required solely to satisfy the requirements of the MOA and paragraph (c) of
Section 2 of this Lease, and
(bb) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished and materials and equipment actually furnished and
installed in connection with the construction of that portion of the facade
and curtain wall of the New Passenger Terminal which faces Building No. 60
in excess of the estimated cost of thereof as shown and specified in the
work and materials of the facade and curtain wall proposed by JetBlue in
the 100% contract drawings dated 8/12/05 as such estimated cost shall be
determined by the Chief Engineer of the Port Authority, but only if such
excess costs are required solely to satisfy the requirements of the MOA and
paragraph (c) of Section 2 of this Lease.
(9) "Cost of the Parking Garage Work" shall mean the sum of the
following amounts, and such amounts only, actually paid or payable by the Lessee
to the extent that the inclusion of the same is permitted by generally accepted
accounting practices consistently applied (it being understood that the Cost of
the Parking Garage Work shall not include any of the Lessee's Shared
Environmental Costs, any of the Cost of the Lessee's $80 Million Work or any of
the Temporary Facilities Costs):
(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished, and materials and equipment actually furnished and
installed (except as otherwise approved by the Port Authority pursuant to
paragraph (m) of this Section) in connection with the Parking Garage Work
(all such amounts in this Item (aa) being herein referred to as the
"Parking Garage Work Item A Costs"); and
(bb) Soft Costs directly charged or allocated to the Cost of
the Parking Garage Work pursuant to paragraph (k) of this Section; and
(cc) General Construction Costs directly charged or
allocated to the Cost of the Parking Garage Work pursuant to paragraph (l)
of this Section.
(10) "Cost of the Passenger Terminal Work" shall mean the sum of
the following amounts, and such amounts only, actually paid or payable by the
Lessee to the extent that the inclusion of the same is permitted by generally
accepted accounting practices consistently applied (it being understood that the
Cost of the Passenger Terminal Work shall in no event include any of the Cost of
the Lessee's $80 Million Work, any of the Temporary Facilities Cost, any of the
Cost of the MOA Curtain Wall Work or any of the Lessee's Shared Environmental
Costs):
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(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished and materials and equipment actually furnished and
installed (except as otherwise approved by the Port Authority pursuant to
paragraph (m) of this Section) in connection with the Passenger Terminal
Work (all such amounts in this Item (aa) being herein referred to as the
"Passenger Terminal Work Item A Costs"), provided, however, Passenger
Terminal Work Item A Costs shall not include any of the Lessee's $80
Million Work, any of the Temporary Facilities Work, any of the Cost of the
MOA Curtain Wall Work or any of the work included in the Lessee's Shared
Environmental Costs;
(bb) Soft Costs directly charged or allocated to the Cost of
the Passenger Terminal Work pursuant to paragraph (k) of this Section; and
(cc) General Construction Costs directly charged or
allocated to the Cost of the Passenger Terminal Work pursuant to paragraph
(l) of this Section.
(11) "Cost of Port Authority Construction Inspection" shall mean
the lesser (i) Three Million Five Hundred Thousand Dollars and No Cents
($3,500,000.00) and (ii) the product derived by multiplying the amount of Three
Million Five Hundred Thousand Dollars and No Cents ($3,500,000.00) by a fraction
the numerator of which shall be the Cost of the Lessee's Redevelopment Work
Elements and the denominator of which shall be $662,919,994.00.
(12) "Cost of the Port Authority Redevelopment Work Elements"
shall mean an amount equal to the sum of the Port Authority's Eligible Below
Ground Asbestos Disposal Costs, the Port Authority's Shared Soil Disposal Costs,
the Port Authority's Incremental Dewatering Costs, the Port Authority's Backfill
Costs, the Port Authority's Non-shared Soil Disposal Costs and the Net Cost of
Port Authority Requested Change Orders.
(13) "Cost of Port Authority Garage Materials Inspection" shall
mean the lesser of: (x) the amount of Seven Hundred Fifty Thousand Dollars and
No Cents ($750,000,00) and (y) the cost of the Port Authority for materials
inspections for the Parking Garage Work, excluding HVAC, elevators, escalators
and surveys, as such cost is computed and recorded by the Port Authority's
accounting system.
(14) "Cost of Port Authority Requested Change Order" shall mean
for each Port Authority Requested Change Order and "Cost of Port Authority
Requested Change Orders" shall collectively mean for all Port Authority
Requested Change Orders (it being understood between the parties that if the MOA
Curtain Wall Work and/or the MOA Flight Wing II Work and/or the Building No. 60
AirTrain Connector Work are performed by the Lessee, such work shall be
performed pursuant to a Port Authority Requested Change Order) either (x) the
all inclusive lump sum amount agreed to by the Lessee and the Port Authority for
the work required of such Port Authority Requested Change Order or (y) in the
event the parties cannot agree on the lump sum amount, the cost of the work as
determined by time and materials, not to exceed an agreed upon maximum cost,
actually paid or payable by the Lessee plus Port
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Authority Delay Costs , provided, however, and notwithstanding the foregoing, if
the work, materials or equipment covered by a Port Authority Requested Change is
part of the Element Budget for the Cost of the Lessee's Redevelopment Work
Elements, then only the incremental cost of such Port Authority Requested Change
Order shall be included in any Cost of the Port Authority Requested Change Order
or in the Cost of the Port Authority Redevelopment Work Elements and the
remainder of the amounts paid or payable under such Port Authority Requested
Change Order shall be included in the Cost of the Lessee's Redevelopment Work
Elements.
(15) "Cost of the Lessee's $80 Million Work" shall mean the
amounts, and such amounts only, actually paid or payable by the Lessee to the
extent that the inclusion of the same is permitted by generally accepted
accounting practices consistently applied (it being understood that the Cost of
the Lessee's $80 Million Work shall in no event include any of the Temporary
Facilities Cost, any of the Cost of the MOA Curtain Wall Work or any of the
Lessee's Shared Environmental Costs):
(aa) the lesser of the amount of Sixty-eight Million Four
Hundred Thousand Dollars and No Cents ($68,400,000.00) and the amount
actually paid or payable by the Lessee to independent third party
contractors for work actually performed, labor actually furnished and
materials and equipment actually furnished and installed (except as
otherwise approved by the Port Authority pursuant to paragraph (m) of this
Section) in connection with the Lessee's $80 Million Work ;
(bb) an amount equal to five percent (5%) of the amounts in
(aa) (the Lessee's $80 Million Work Soft Costs"); and
(cc) an amount equal to twelve percent (12%) of the amounts
in (aa) (the Lessee's $80 Million Work General Construction Costs");
as the above mentioned amounts are evidenced by a notarized certificate of a
responsible fiscal officer of the Lessee and delivered to the Port Authority on
or before the Tentative Final Certificate Date, which certificate shall:
(aa) set forth, in reasonable detail, the amounts paid to
specified independent third party contractors and the amount of payments
made to other specified Persons for the Lessee's $80 Million Work and
identify and explain how these amounts are excluded from the amount of Item
A Costs for the purpose of determining the Cost of the Redevelopment Work;
(bb) have attached thereto reproduction copies or duplicate
originals of the invoices of such independent third party contractors and
other Persons and an acknowledgment by such independent contractors and
other Persons of the receipt by them of such amounts and payments;
(cc) set forth the amounts of the Lessee's $80 Million Work
Soft Costs and the Lessee's $80 Million Work General Construction Costs and
identify and explain how these amounts are to be excluded from the amount
of the Soft Costs and
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the amount of the General Construction Costs for the purpose of determining
the Cost of the Redevelopment Work; and
(dd) certify that the amounts and payments therein set forth
constitute all or a portion of the Lessee's $80 Million Work and that none
of the amounts and payments have been or will be included in the Cost of
the Redevelopment Work or in any of the certificates submitted by the
Lessee pursuant to paragraph (d) of this Section.
The Cost of the Lessee's $80 Million Work shall include only Shell Completion
Work performed by the Lessee in accordance with all the terms and provisions of
this Lease and on or prior to the Tentative Final Certificate Date. It is
specifically understood and agreed that the Lessee's $80 Million Work shall not
include any payment or payments on account of any administrative or other
overhead costs of the Lessee whether or not allocated to the Lessee's $80
Million Work by the Lessee's own accounting practices.
(16) "Cost of the Redevelopment Work" shall mean an amount equal
to the sum of (i) the Cost of the Port Authority Redevelopment Work Elements,
(ii) the Port Authority's Share of the Cost of the Lessee's Redevelopment Work
Elements and (iii) the Port Authority's Share of the Lessee's Project
Contingency Costs, provided, however, as used in paragraphs (c), (d) and (g) of
this Section with respect to amounts that the Port Authority is to pay the
Lessee, "Cost of the Redevelopment Work" shall be deemed to not include Carrying
Costs, the Cost of Port Authority Garage Materials Inspection and the Cost of
Port Authority Construction Inspection.
(17) "Cost of the Terminal 5 AirTrain Connector Work" shall mean
the sum of the following amounts, and such amounts only, actually paid or
payable by the Lessee to the extent that the inclusion of the same is permitted
by generally accepted accounting practices consistently applied (it being
understood that the Cost of the Terminal 5 AirTrain Connector Work shall in no
event include any of the Cost of the Lessee's $80 Million Work or any of the
Temporary Facilities Cost or any of the Lessee's Shared Environmental Costs):
(aa) amounts actually paid or payable by the Lessee to
independent third party contractors for work actually performed, labor
actually furnished and materials and equipment actually furnished and
installed (except as otherwise approved by the Port Authority pursuant to
paragraph (m) of this Section) in connection with the Terminal 5 AirTrain
Connector Work (all such amounts in this Item (aa) being herein referred to
as the "Terminal 5 AirTrain Connector Work Item A Costs"); and
(bb) Soft Costs directly charged or allocated to the Cost of
the Terminal 5 AirTrain Connector Work pursuant to paragraph (k) of this
Section; and
(cc) General Construction Costs directly charged or
allocated to the Cost of the Terminal 5 AirTrain Connector Work pursuant to
paragraph (l) of this Section.
(18) "Element of Cost" shall mean each of and "Elements of Costs"
shall mean all of the following: the Port Authority's Eligible Below Ground
Asbestos Disposal Costs; the Port Authority's Shared Soil Disposal Costs; the
Port Authority's Incremental
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Costs; the Port Authority's Shared Soil Disoisal Costs; the Port Authority's
Incremental Dewatering Costs; the Port Authority's Non-shared Soil Disposal
Costs; the Port Authority's Backfill Costs; the Lessee's Shared Environmental
Costs; the Net Cost of Port Authority Requested Change Orders; the Cost of the
Airside Civil Work; the Cost of the Landside Civil Work; the Cost of the Parking
Garage Work; the Cost of the Passenger Terminal Work; the Cost of the Terminal 5
AirTrain Connector Work; the Carrying Cost; the Lessee's Administrative Amount;
the Cost of Port Authority Garage Materials Inspection; and the Cost of Port
Authority Construction Inspection.
(19) "Final Date" shall mean the last day of the month in which
the second (2nd) anniversary of the Tentative Final Certificate Date shall
occur.
(20) "General Construction Costs" shall mean amounts actually
paid or payable by the Lessee to independent third parties for general
conditions, construction management and field supervision, performance and
payment bonds, insurance, testing, inspection and surveys in connection with the
Redevelopment Work (without duplication and excluding any amounts included in
Item (A) Costs and Soft Costs).
(21) "Item A Costs" shall mean the amounts set forth in Item (aa)
of the definitions of each of the Cost of the Airside Civil Work, the Cost of
the Landside Civil Work, the Cost of the Passenger Terminal, the Cost of the
Parking Garage Work and the Cost of the Terminal 5 AirTrain Connector Work.
(22) "Lessee's Administrative Amount" shall mean the lesser of
(i) Four Million Five Hundred Thousand Dollars and No Cents ($4,500,000.00 and
(ii) the product derived by multiplying the amount of Four Million Five Hundred
Thousand Dollars and No Cents ($4,500,000.00) by a fraction the numerator of
which shall be the Cost of the Lessee's Redevelopment Work Elements and the
denominator of which shall be $662,919,994.00.
(23) "Lessee's $80 Million Work" shall mean that portion of the
Shell Completion Work that is included in the first Shell Completion Work
performed after the Shell Completion Date but on or prior to the Tentative Final
Certificate Date, is included in the Cost of the Lessee's $80 Million Work and
is set forth in a notarized certificate of a responsible officer of the Lessee
and delivered to the Port Authority on or before the Tentative Final Certificate
Date, which certificate shall clearly list, specify and set forth a complete
description and location of the Lessee's $80 Million Work as shall be necessary
to appropriately identify the Lessee's $80 Million Work from the rest of the
Redevelopment Work, including without limitation serial numbers, quantities and
model numbers.
(24) "Net Cost of Port Authority Requested Change Orders" shall
mean an amount equal to cumulative total, after taking into account all credits
and extras, of the Cost of Port Authority Requested Change Orders.
(25) "Outstanding Claim" shall mean any claim and demand of a
third person arising out of the performance of the Port Authority Payment Work
which claim and demand if paid by the Lessee would be included as part of the
Cost of the Redevelopment Work
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and such claim and demand is being disputed by the Lessee in a court of
competent jurisdiction and the dispute has not been settled or finally
adjudicated.
(26) "Port Authority Delay Costs" shall mean identifiable and
quantifiable additional costs arising solely because of a schedule delay due to
a Port Authority Requested Change Order provided that such costs are included in
the Port Authority Requested Change Order as approved by the Port Authority. In
the event that the Lessee shall have submitted an estimate for a Port Authority
Requested Change that includes proposed amounts for Port Authority Delay Costs
which the Port Authority Director of Redevelopment disagrees with, the Chief
Engineer of the Port Authority shall determine the amount of Port Authority
Delay Costs for such Port Authority Requested Change and such determination by
the Chief Engineer of the Port Authority shall be the amount of Port Authority
Delay Costs included in the Port Authority Requested Change Order.
(27) "Port Authority Payment" shall mean each payment made by the
Port Authority to the Lessee for the Cost of the Redevelopment Work pursuant to
paragraph (d) of this Section.
(28) "Port Authority Payment Work" shall mean that portion of the
Redevelopment Work that is included in the Cost of the Redevelopment Work as
such term is used in paragraphs (c), (d) and (g) of this Section.
(29) "Port Authority's Share of the Cost of the Lessee's
Redevelopment Work Elements" shall mean the lesser of (x) the amount equal to
the difference obtained by subtracting from the amount of Six Hundred Fifty-four
Million Seven Hundred Thousand Dollars and No Cents ($654,700,000.00), an amount
equal to the sum of the Carrying Cost, the Cost of Port Authority Construction
Inspection and the Cost of Port Authority Garage Materials Inspection, and (y)
the amount equal to the difference obtained by subtracting from the Cost of the
Lessee's Redevelopment Work Elements an amount equal to the sum of the Carrying
Cost, the Cost of Port Authority Construction Inspection and the Cost of Port
Authority Garage Materials Inspection.
(30) "Port Authority's Share of the Lessee's Project Contingency
Costs" shall be zero unless both the following events shall have occurred: (x)
the Cost of the Lessee's Redevelopment Work Elements shall exceed the amount of
Six Hundred Fifty-Four Million Seven Hundred Thousand Dollars and No Cents
($654,700,000.00) and (y) the Port Authority shall have received notice from the
Lessee that the Lessee requests that the Port Authority reimburse the Lessee for
the Port Authority's Share of the Lessee's Project Contingency Costs pursuant to
and as provided in this Section 87; then upon the occurrence of both events set
forth in the foregoing clauses (x) and (y) having occurred, "Port Authority's
Share of the Lessee's Project Contingency Costs" shall mean an amount equal to
the lesser of
(A) the amount obtained by subtracting from the amount of Fifty
Million Dollars and No Cents ($50,000,000.00), the difference obtained by
subtracting the sum of the Carrying Cost, the Cost of Port Authority
Construction Inspection and the Cost of Port Authority Garage Materials
Inspection at the time that the Cost of the
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▇▇▇▇▇▇'s Redevelopment Work Elements first exceeds the amount of Six
Hundred Fifty-four Million Seven Hundred Thousand Dollars and No Cents
($654,700,000.00), from the sum of the Carrying Cost, the Cost of Port
Authority Construction Inspection and the Cost of Port Authority Garage
Materials Inspection, and
(B) the amount obtained by subtracting from the Cost of the
Lessee's Redevelopment Work Elements, the sum of (x) Six Hundred Fifty-four
Million Seven Hundred Thousand Dollars and No Cents ($654,700,000.00) and
(y) the difference obtained by subtracting the sum of the Carrying Cost,
the Cost of Port Authority Construction Inspection and the Cost of Port
Authority Garage Materials Inspection at the time that the Cost of the
Lessee's Redevelopment Work Elements first exceeds the amount of Six
Hundred Fifty-four Million Seven Hundred Thousand Dollars and No Cents
($654,700,000.00), from the sum of the Carrying Cost, the Cost of Port
Authority Construction Inspection and the Cost of Port Authority Garage
Materials Inspection .
(31) "Project Contingency Payment" shall mean each of and
"Project Contingency Payments" shall mean all of the Port Authority Payments
made to the Lessee for the Port Authority's Share of the Lessee's Project
Contingency Costs.
(32) "Redevelopment Work Certificate" shall mean each certificate
submitted by the Lessee pursuant to and in accordance with paragraph (d) hereof
which meets all of the requirements of paragraph (d) hereof.
(33) "Shell Completion Work" shall mean those components of the
Redevelopment Work set forth in the exhibit attached hereto, hereby made a part
and marked "Exhibit 87.1" (herein referred to as "Exhibit 87.1").
(34) "Shell Completion Date" shall mean the date the Port
Authority shall determine that the headhouse roof and exterior walls are
sufficiently water tight that the Lessee can commence performance of on site
construction or installation of any Shell Completion Work, as such date shall be
set forth in a notice given by the Port Authority to the Lessee.
(35) "Soft Costs" shall mean the lesser of (x) Seventy Million
Dollars and No Cents ($70,000,000.00) and (y) amounts actually paid or payable
by the Lessee to independent third parties for planning, design, engineering,
architectural, project management and program management and the Lessee's Cost
of the Initial Post Construction Baseline (all of the Lessee's Cost of the
Initial Post Construction Baseline to be allocated to the Cost of the Airside
Civil Work) in connection with the Redevelopment Work without duplication of any
other Cost of the Redevelopment Work, including without limitation, the
inclusion therein of any General Construction Costs, the Lessee's Administrative
Amount, the Cost of Port Authority Garage Materials Inspection and the Cost of
Port Authority Construction Inspection and shall not include any amounts
included in the Cost of the Lessee's $80 Million Work or the Temporary
Facilities Cost.
(36) "Temporary Facilities Cost" shall mean all costs incurred by
the Lessee to perform the Temporary Terminal Work except for the amounts
actually paid or
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payable by the Lessee to independent third party contractors for the purchase of
the jet bridges and lounge furniture that are installed at the New Passenger
Terminal. None of the Temporary Facilities Cost shall be a part of the Cost of
the Redevelopment Work.
(37) "Tentative Final Certificate Date" shall mean the earlier to
occur of (i) the day prior to the first anniversary of Completion Date, if the
Completion Date is the first day of the month, and if not, then the last day of
the calendar month in which the first anniversary of the Completion Date shall
occur and (ii) the sixth (6th) anniversary of the Lease Commencement Date if the
Lease Commencement Date is the first day of the month, and if not, then the last
day of the calendar month in which the sixth (6th) anniversary of the Lease
Commencement Date shall occur.
(b) It is specifically understood and agreed that notwithstanding
anything to the contrary herein, costs and expenses of the Redevelopment Work
shall be reimbursed by the Port Authority as provided herein and only to the
extent provided for herein and properly includable in (i) the Cost of the Port
Authority Redevelopment Work Elements to the extent such costs and expenses are
properly incurred by the Lessee, or (ii) the Port Authority's Share of the Cost
of the Lessee's Redevelopment Work Elements to the extent such costs and
expenses are properly incurred by the Lessee, or (iii) the Port Authority's
Share of the Lessee's Project Contingency Costs to the extent such costs and
expenses are properly incurred by the Lessee; and the Lessee shall perform all
of the Redevelopment Work at its sole cost and expense without any payment
thereof by the Port Authority except as expressly set forth in this Section.
(c) (1) The Cost of the Redevelopment Work shall include only Port
Authority Payment Work performed by the Lessee in accordance with all the terms
and provisions of this Lease and the Redevelopment Work Construction
Applications.
(2) It is specifically understood and agreed that the Cost of the
Redevelopment Work shall not include:
(i) any amounts paid for or in connection with any trade
fixtures or other personal property of the Lessee, provided, however, the Cost
of the Redevelopment Work may include trade fixtures that are not part of the
Lessee's $80 Million Work provided that such trade fixtures are not proprietary
and can be used by any Scheduled Aircraft Operator without any modification
thereto, it being understood and agreed that title to all such trade fixtures
shall have passed to the City of New York as provided for in paragraph (k) of
Section 2 hereof; or
(ii) any payment or payments on account of any
administrative or other overhead costs or any payment to employees of the Lessee
whether or not allocated to the Cost of the Redevelopment Work by the Lessee's
own accounting practices in excess of the Lessee's Administrative Amount; or
(iii) any amounts paid to a firm or corporation wholly or
partially owned by or in common ownership with the Lessee, provided, however,
amounts paid or payable to LiveTV, LLC for any services, equipment, materials or
other items which are not
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proprietary and are not in excess of the fair market value thereof may be
included in the Cost of the Redevelopment Work; or
(iv) any equipment, fixture or improvements which are
secured by liens, mortgages, other encumbrances or conditional bills of sale; or
(v) any amounts for the Lessee's $80 Million Work; or
(vi) any Temporary Facilities Cost.
(d) The Port Authority shall reimburse the Lessee for the Cost of the
Redevelopment Work to the extent such costs and expenses are properly incurred
by the Lessee and to the extent and subject to and in accordance with the terms
and provisions of this Section, including without limitation, as follows:
(1) On or before the twentieth (20th) day of the calendar month
following the month in which the Lease Commencement Date shall occur, and on or
before the twentieth (20th) day of each calendar month thereafter up to and
including the calendar month in which the Tentative Final Certificate Date shall
occur, provided, however, in the event that there shall be any Outstanding
Claims as of the Tentative Final Certificate Date the costs of which the
Lessee's wishes to be paid for pursuant to this Section, and only in such event,
then with respect to those Redevelopment Work Certificates solely covering such
Outstanding Claims, then up to and including the calendar month in which the
Final Date shall occur, the Lessee shall, but not more often than once a month,
deliver to the Port Authority a notarized certificate which shall be signed by a
responsible fiscal officer of the Lessee and shall:
(i) certify and set forth the amounts of actual payments
made by the Lessee and the amounts actually due and payable from the Lessee to
its independent third party contractors contained in the certificate for work
actually performed, labor actually furnished and materials and equipment
actually furnished and installed (except as approved by the Port Authority
pursuant to paragraph (m) of this Section) for the Port Authority Payment Work
for each of the Elements of Costs;
(ii) separately certify and state the amounts of actual
payments made by the Lessee and the amounts due and payable from the Lessee to
its independent third party contractors in connection with the Port Authority
Payment Work contained in the certificate for planning, design, engineering,
architectural, project management, program management, general conditions,
construction management, field supervision, performance and payment bonds,
testing, inspection and surveys and separately certify and state the foregoing
for each of the Elements of Costs;
(iii) have attached thereto reproduction copies or duplicate
originals of the invoices of such independent third party contractors and other
persons (whether such invoices are paid or unpaid) and for such invoices which
have been paid, an acknowledgment by such independent contractors and other
persons of the receipt by them of such amounts and payments;
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(iv) have attached thereto appropriate AIA forms such as but
not limited to Form 702/CMa and Form 703 with a breakdown of each of the
aforesaid amounts, payments and expenses which constitute portions of the Cost
of the Redevelopment Work, listed separately by contract (or other agreement)
(with sufficient detail as to identification of costs and retainage) for each
contractor or other person to whom payment has been made separately setting such
breakdown for each of the Elements of Costs; it being expressly understood and
agreed that each Redevelopment Work Certificate shall be for amounts net of
retainage with respect to each contract and each Redevelopment Work Certificate
shall state the amounts of such retainage on a cumulative basis as to each and
every such contract and subcontract.
(v) certify that all due and payable amounts included by the
Lessee in all certificates against which a Port Authority Payment has been made
to the Lessee (with exception of the certificate submitted by the Lessee for the
immediately preceding calendar month) have been paid by the Lessee and shall
have attached thereto or included therein such verification as shall be required
by the Port Authority that all such amounts have been paid;
(vi) certify the total cumulative payments made by the
Lessee from the commencement of the Port Authority Payment Work to the date of
each certificate for the Port Authority Payment Work and the total cumulative
payments made by the Lessee from the commencement of the Port Authority Payment
Work to the date of each certificate for each of the Elements of Costs;
(vii) contain a representation by the Lessee that the Lessee
will apply the Port Authority Payment only against expenses actually payable as
Cost of the Redevelopment Work and for no other purpose whatsoever;
(viii) certify that the amounts and payments therein set
forth constitute the Cost of the Redevelopment Work;
(ix) certify that the work for which payment is requested
has been accomplished, that the amounts requested have been paid or are due and
payable to the Lessee's contractors, and, subject to the concurrence of the Port
Authority, that such work is in place and has a value of not less than the
amount requested to be paid (except as otherwise approved by the Port Authority
pursuant to paragraph (m) of this Section);
(x) certify that each portion of the Port Authority Payment
Work covered by such certificate has been performed in accordance with the terms
of this Lease, the Redevelopment Work Construction Applications and the
applicable contract;
(xi) have attached thereto accurate, readable and complete
copies of all change order logs, extra work authorization logs, design change
authorization logs and purchase orders in connection with the Port Authority
Payment Work;
(xii) have attached thereto a certification signed by the
Lessee's licensed Architect(s) of Record or licensed Engineer(s) of Record that
the applicable portion of
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the work is in compliance with the Redevelopment Work Construction Applications
and the plans and specifications forming a part thereof as approved by the Port
Authority;
(xiii) certify that except for the amount, if any, stated in
such Redevelopment Work Certificate to be due for work, services and materials,
there is no outstanding indebtedness known to the person signing such
Redevelopment Work Certificate, after due inquiry, then due on account of the
purchase of any equipment or fixtures described in the Redevelopment Work
Certificate or for labor, wages, materials, supplies or services in connection
with any Redevelopment Work whether or not described in or covered by such
Redevelopment Work Certificate which, if unpaid, might become the basis of a
vendor's, mechanic's, laborer's or materialmen statutory or similar lien or
alleged lien upon such work or upon the Redevelopment Work Sites or any portion
thereof, or upon the Lessee's leasehold interest in the Premises, nor are any of
the improvements, equipment or fixtures described in such Redevelopment Work
Certificate secured by any liens, mortgages, security interests or other
encumbrances, provided, however, nothing contained herein shall be deemed or
construed as a submission by the Port Authority to the application to itself of
any such lien;
(xiv) if the certificate covers materials and equipment
stored at off-site locations approved by the Port Authority, then have attached
thereto all of the evidence required by paragraph (h) of this Section;
(xv) if the certificate covers equipment for which the
Lessee has requested progress payments or payment for long lead order placement
be made as set forth in paragraph (m) of this Section, then the Lessee shall
certify the amounts representing the value of the equipment at the time of
request or the actual amount of the payment for long lead order placement and
have attached thereto all documentation required by such paragraph (m) and such
other documentation as may be required by the Port Authority;
(xvi) if the certificate covers the Initial Post
Construction Baseline, then have attached thereto all of the information
required by paragraph (m)(4) of Section 56 hereof;
(xvii) for each item of personal property covered by the
certificate, a bill of sale therefore showing ownership of such personal
property in the Port Authority and identifying the same by serial number or
other similar identification number and the location where the same was
installed as a part of the Redevelopment Work;
(xviii) if certificate covers retainage to be released
pursuant to the provisions of paragraph (n) of this Section , then a copy of a
duly executed copy of a release in the form attached hereto as Exhibit 87.2; and
(xix) contain such further information and documentation
with respect to the Cost of the Redevelopment Work as the Port Authority may
from time to time require, which information, documentation and certification
shall be given on such forms as may be adopted by the Port Authority.
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(2) In addition to and without limiting the foregoing, and in
addition to any and all other information required to be submitted pursuant to
this Lease, the Lessee shall furnish to the Port Authority information
concerning budget, costs, costs estimates, plans and specifications, timing,
scheduling and performance of the Port Authority Payment Work as may be
requested by the Port Authority, from time to time including but not limited to
the following:
(i) the Lessee's original detailed cost estimates for each
of the Elements of Costs, prepared by an independent engineering consultant,
independent licensed architect or independent construction management firm
specializing in cost estimating and budgeting, that the cost estimates for each
of the Elements of Costs submitted by the Lessee are consistent with standard
engineering practices, and that the same represent reasonable prices for the
work in question;
(ii) reports of the Lessee's full-time resident engineer or
licensed architect referred to in paragraph (g) of Section 2 of this Lease as to
activity conducted in connection with the Redevelopment Work for each and every
day from the commencement of the work to the date of submission;
(iii) certifications signed by the Lessee's Construction
Manager, Engineer(s) of Record, or Architect(s) of Record certifying the value
of work in place;
(iv) certifications signed by the Lessee's licensed
Architect(s) of Record or licensed professional Engineer(s) of Record that the
applicable portion of the Redevelopment Work is in compliance with the plans and
specifications therefore as approved by the Port Authority;
(v) true copies of all reports of and schedules of any type
submitted or kept, or required to be submitted or kept, by the Lessee or any
contractor, architect, engineer or other consultant of the Lessee, which reports
must contain reports as to activity conducted in connection with the
Redevelopment Work on a continuing basis from the commencement of the
Redevelopment Work to the date of submission;
(vi) true copies of any and all of the items described in
and required under paragraph (d)(3) of this Section; and
(vii) accurate, readable and complete copies of any or all
Change Orders, extra work authorizations, design change authorizations, and
purchase orders in connection with the Redevelopment Work.
(3) Except with respect to the payment of amounts covered by the
Tentative Final Redevelopment Work Certificate and the Final Redevelopment Work
Certificate, if any, which payments shall be made by the Port Authority as set
forth in subparagraph (5) of this paragraph (d), within thirty (30) days after
the delivery of each duly submitted Redevelopment Work Certificate by the Lessee
satisfying in full the requirements of this paragraph (d) as determined by the
Port Authority, the Port Authority shall pay to the Lessee the
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following amounts to the extent that such amounts or any portion thereof have
not been included in any prior Redevelopment Work Certificate:
(i) an amount on account of the Lessee's Administrative
Amount of this Section to the extent that such amount or any portion thereof is
part of the Cost of the Redevelopment Work and has not theretofore been included
in any prior Redevelopment Work Certificate, and
(ii) the amounts paid by the Lessee or payable by the Lessee
to independent third parties, as certified in such Redevelopment Work
Certificate, to the extent that such amounts or any portion thereof are part of
the Cost of the Redevelopment Work and have not theretofore been included in any
prior Redevelopment Work Certificate, less (x) retainage, and (y) the amount of
any claims made against the Port Authority by subcontractors, materialmen or
workmen, if any, in connection with any of the work described in such
certificate.
(4) In addition to and without limiting the foregoing provisions
and without limiting or impairing or waiving any other right or remedy of the
Port Authority under this Lease or otherwise, the Port Authority shall have the
right, in its discretion, to withhold from any of the aforesaid payments to the
Lessee the amounts of any or all items contained in a Redevelopment Work
Certificate if any the following shall have occurred:
(i) if the Port Authority's inspection and/or audit does not
substantiate the contents of such certificate, but the Port Authority shall have
no obligation to conduct any such inspection or audit;
(ii) in the event this Lease is not in full force and
effect, or the Lessee shall be under a notice of termination of the Lease, or in
default under any term or provision thereof, provided, however, no payment or
withholding of a Port Authority Payment shall be or be deemed to be a waiver of
any rights of the Port Authority with respect to the termination of the Lease,
or to a default by the Lessee under any term or provision thereof, or to the
withholding or payment of future Port Authority Payments.
(iii) all due and payable amounts included on all previously
submitted Redevelopment Work Certificates and for which a Port Authority Payment
has been made, have not been paid by the Lessee and the payment thereof verified
to the satisfaction of the Port Authority (unless such amounts are being
withheld by the Lessee pursuant to paragraph (g) of Section 2 of this Agreement,
and the amount so withheld shall have been deducted from the amount of a Port
Authority Payment);
(iv) any contractor or other Person included or covered by
the Redevelopment Work Certificate is in default or under a notice of
termination with respect to its contract or agreement, or has not complied with
all of the applicable terms or provisions of its contract or agreement;
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(v) the Redevelopment Work Certificate or any of the
certifications and documentation and other items required to be contained
therein, attached thereto or submitted therewith is not in accord with the terms
of this Lease or the applicable contract, or is not complete or is otherwise
improper or inadequate, or the same fails to include or omits required items;
(vi) inadequate or defective work or work not in accordance
with this Lease or the Redevelopment Work Construction Applications, or
materials and equipment are not properly stored or protected;
(vii) claims related to the Port Authority Payment Work made
by the Port Authority against a contractor included in such Redevelopment Work
Certificate which are outstanding; or
(viii) work not performed but for which a Redevelopment Work
Certificate has been submitted.
(5) Tentative Final Certificate and Final Certificate:
(i) (aa) If there are no Outstanding Claims on the Tentative
Final Certificate Date, the Lessee shall mark as "final" its last Redevelopment
Work Certificate submitted on or before the Tentative Final Certificate Date and
if there are Outstanding Claims on the Tentative Final Certificate Date, the
Lessee shall mark as "tentatively final" its last Redevelopment Work Certificate
submitted on or before the Tentative Final Certificate Date. Unless there are
one or more Outstanding Claims on the Tentative Final Certificate Date, the
Lessee shall submit no further certificates hereunder for the Port Authority
Payment Work after the Tentative Final Certificate Date and if there are
Outstanding Claims on the Tentative Final Certificate Date, the Lessee shall
submit no further certificates hereunder for the Port Authority Payment Work
after the Tentative Final Certificate Date except for certificates covering such
Outstanding Claims.
(bb) With respect to amounts withheld by the Lessee
pursuant to paragraph (g) of Section 2 of this Lease which have been deducted
from a Redevelopment Work Certificate and which have subsequently been paid by
the Lessee, such final and/or tentatively final certificate shall have attached
thereto or included thereon such verification as shall be required by the Port
Authority that such withheld and deducted amounts have been paid by the Lessee
and to the extent such withheld and deducted amounts have been so paid, such
withheld and deducted amounts shall be included in the amount of the Port
Authority Payment made pursuant to such Redevelopment Work Certificate, except
with respect to any portion of the Port Authority Payment Work for which there
is an Outstanding Claim.
(ii) (aa) If there are Outstanding Claims on the Tentative
Final Certificate Date, the Lessee shall mark as "final" its last Redevelopment
Work Certificate submitted on or before the Final Date. Such certificate shall
only cover Outstanding Claims existing on the Tentative Final Certificate Date.
The Lessee shall submit no further certificates hereunder for the Port Authority
Payment Work after the Final Date.
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(bb) With respect to amounts withheld by the Lessee
pursuant to paragraph (g) of Section 2 of this Lease which have been deducted
from a Redevelopment Work Certificate, were part of the Port Authority Payment
Work subject to an Outstanding Claim on the Tentative Final Certificate Date and
which have subsequently been paid by the Lessee, such final certificate shall
have attached thereto or included thereon such verification as shall be required
by the Port Authority that such withheld and deducted amounts have been paid by
the Lessee and to the extent such withheld and deducted amounts have been so
paid, such withheld and deducted amounts shall be included in the amount of the
Port Authority Payment made pursuant to such Redevelopment Work Certificate.
(6) The final Port Authority Payment for the Cost of the
Redevelopment Work shall not be made to the Lessee unless and until the Lessee
has, to the satisfaction of the Port Authority, fully complied with all of the
terms of this Section and all other applicable terms of this Agreement,
submitted to the Port Authority all certifications, documentation and the like
required under this Section and Section 2, including without limitation any
certifications, warranties, maintenance contracts, documentation, releases or
waivers the Port Authority may require in connection therewith; submitted to the
Port Authority such evidence of title to the Redevelopment Work in accordance
with the provisions of this Agreement. No such final payment by the Port
Authority shall constitute any waiver of claims or release by the Port Authority
against the Lessee or any of its contractors, subcontractors, construction
managers, architects, engineers, or others, nor any waiver of the Port
Authority's rights of audit and inspection, nor any waiver of any other rights
or remedies, legal or equitable, of the Port Authority.
(7) No Port Authority Payment made by the Port Authority
hereunder shall mean or be deemed to mean that the amount of such Port Authority
Payment is correct or that all the requirements set forth herein with respect to
the payment by the Port Authority to the Lessee for the Cost of the
Redevelopment Work have been met.
(8) (i) If there are no Port Authority's Share of the Lessee's
Project Contingency Costs, then the entire obligation of the Port Authority
under this paragraph (d) to pay to the Lessee the Cost of the Redevelopment Work
shall be limited in an amount equal to the sum of the Cost of the Port Authority
Redevelopment Work Elements and the Port Authority's Share of the Cost of the
Lessee's Redevelopment Work Elements.
(ii) If there are any Port Authority's Share of the Lessee's
Project Contingency Costs, then the entire obligation of the Port Authority
under this paragraph (d) to pay to the Lessee the Cost of the Redevelopment Work
shall be limited in an amount equal to the sum of the Cost of the Port Authority
Redevelopment Work Elements, the Port Authority's Share of the Cost of the
Lessee's Redevelopment Work Elements and the Port Authority's Share of the
Lessee's Project Contingency Costs.
(iii) The obligation of the Port Authority to make Port
Authority Payments shall be limited in time to Redevelopment Work Certificates
properly submitted by the Lessee in accordance with and under this Section on or
prior to the Tentative Final Certificate
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Date, provided, however, in the event that there shall be any Outstanding Claims
on the Tentative Final Certificate Date with respect to the Cost of the
Redevelopment Work, the obligation of the Port Authority under this paragraph
(d) to reimburse the Lessee for the amount of such Outstanding Claims shall not
be limited to the Tentative Final Certificate Date but instead such obligation
with respect to those Redevelopment Work Certificates solely covering such
Outstanding Claims shall be limited in time to such Redevelopment Work
Certificates properly submitted by the Lessee in accordance with and under this
Section on or prior to the Final Date.
(9) The Lessee shall promptly submit to the Port Authority
further information, including but not limited to its estimate of the amounts
and times of the various payments it will be making for the Cost of the
Redevelopment Work as the Port Authority may from time to time, and at any time,
request, and shall be available itself or cause its architect or engineer to be
available for consultation in connection with the Redevelopment Work
Certificates submitted by this Lessee pursuant to this paragraph (d).
(10) It is understood that, except for the Lessee's
Administrative Amount, the Port Authority shall pay the Lessee pursuant to and
in accordance with this Section 87 for amounts paid or payable by the Lessee for
the Port Authority's Share of the Lessee's Cost of the Redevelopment Work
Elements paid or payable by the Lessee prior to the Effective Date.
(e) Without limiting any other provision of this Lease, the Books and
Records that the Lessee shall be required to keep and maintain pursuant to this
Lease and as set forth in Section 65 hereof shall include, without limitation,
any and all invoices and supporting documentation relating to the Redevelopment
Work or any portion thereof and any and all contracts covering each portion of
the Redevelopment Work including but not limited to the Lessee's contracts and
agreements with its architects, engineers, and construction managers and other
contractors.
(f) In the event that a Port Authority audit shall disclose, based
upon Redevelopment Work Certificates or otherwise, that a Port Authority Payment
should not have been made or that amounts paid by the Port Authority pursuant to
this Section 87 exceed the amounts that are required to by paid by the Port
Authority to the Lessee pursuant to this Section 87, then, upon thirty (30) days
demand, the Lessee shall immediately pay to the Port Authority an amount equal
to the excess amount paid by the Port Authority; the foregoing shall not be or
be deemed to be any limitation, impairment or waiver of any other right or
remedy of the Port Authority under the Lease or otherwise.
(g) If the Lessee has included in any portion of the Cost of the
Redevelopment Work any item as having been incurred, but which in the opinion of
the Port Authority was not so incurred, or which in the opinion of the Port
Authority if so incurred is not an item properly chargeable to the Cost of the
Redevelopment Work under generally accepted accounting practice, or does not
represent an appropriate allocation of the costs of a particular contract which
are required to be designated in accordance with Section 2 of this Lease and the
parties have been unable to resolve their differences within 90 days after the
Port Authority gave its
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notice objecting to the same, the decision of the Chief Engineer of the Port
Authority as to the nature of the items in question shall be final.
(h) In order for the Lessee to receive Port Authority Payments for
materials and equipment stored at an off-site storage location, such location
must have received the prior written approval of the Port Authority and the
Lessee shall have submitted (i) evidence that all materials and equipment stored
at an off-site storage locations approved by the Port Authority are adequately
protected and insured, (ii) evidence that title to all such materials and/or
equipment has vested in the City of New York free and clear of any security
interests, or other encumbrances, (iii) an inventory control schedule covering
such materials and equipment, (iv) evidence that such materials and/or equipment
(as well as any shop drawings required by the Port Authority) have been approved
by the Port Authority, (v) such documentation that the Port Authority may
request in order for it to determine the actual incurred costs of the materials
and equipment which are the subject of a Redevelopment Work Certificate, (vi)
such documentation that the Port Authority is adequately protected and against
any loss or damage to the equipment or materials through insurance and such
other means acceptable to the Port Authority, and (vii) such other documentation
as may be reasonably required by the Port Authority.
(i) It is hereby understood and agreed that nothing in this Section
shall be or shall be deemed for the benefit of any contractor of the Lessee or
other third party and nothing contained herein shall operate or give to any such
contractor or third party any claim or right of action against the Port
Authority and its Commissioners, officers, agents and employees.
(j) The Port Authority's Construction Inspection Costs shall be
allocated among the Allocable Elements of Work as follows: each of the Cost of
the Airside Civil Work, the Cost of the Landside Civil Work, the Cost of the
Passenger Terminal Work, the Cost of the Parking Garage Work and the Cost of the
Terminal 5 AirTrain Connector Work, the amounts equal to the Port Authority
Construction Inspection Costs shall be multiplied by a fraction the numerator of
which shall be the total of all of the Item A Costs for each of the Allocable
Elements of Work and the denominator of which shall be the total of all of the
Item A Costs for all Elements of Work.
(k) To the extent possible, Soft Costs shall be directly charged and
accumulated for each of the individual Allocable Elements of Work. When such
direct charging and accumulating Soft Costs is not possible, the non-direct Soft
Costs shall be allocated among the Allocable Elements of Work as follows: for
each of the Cost of the Airside Civil Work, the Cost of the Landside Civil Work,
the Cost of the Passenger Terminal Work, the Cost of the Parking Garage Work and
the Cost of the Terminal 5 AirTrain Connector Work, an amount equal to all of
the non-direct Soft Costs shall be multiplied by a fraction the numerator of
which shall be the total of all of the Item A Costs for each of the Allocable
Elements of Work and the denominator of which shall be the total of all of the
Item A Costs for all Elements of Work.
(l) To the extent possible, General Construction Costs shall be
directly charged and accumulated for each of the Allocable Elements of Work.
When such direct charging and accumulating of General Construction Costs is not
possible, the non-direct General Construction Costs shall be allocated among the
Allocable Elements of Work as follows: for
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each of the Cost of the Airside Civil Work, the Cost of the Landside Civil Work,
the Cost of the Passenger Terminal Work, the Cost of the Parking Garage Work and
the Cost of the Terminal 5 AirTrain Connector Work, an amount equal to all of
the non-direct General Construction Costs shall be multiplied by a fraction the
numerator of which shall be the total of all of the Item A Costs for each of the
Allocable Elements of Work and the denominator of which shall be the total of
all of the Item A Costs for all Elements of Work.
(m) In the event that the Lessee is required to make a payment for
specifically identified equipment or materials for the Redevelopment Work that
requires a long lead time to procure, and the Lessee wishes to receive Port
Authority Payments based on progress of manufacture in the factory or
manufacturer required payments for long lead order placement to reserve a place
in the production queue, the Lessee shall make such request to the Resident
Engineer. If the Port Authority consents to making progress payments or payments
to reserve a place in the production queue for any such equipment or materials,
then (i) all documentation related to the purchase of the equipment, including
without limitation the purchase contract showing amounts, rights, schedule for
manufacture and delivery, etc., must be provided to the Port Authority for its
review and approval prior to entering into the contract, (ii) the contract
between the Lessee and the contractor manufacturing such equipment must protect
the Port Authority from and against any loss or damage to the equipment through
insurance and such other means acceptable to the Port Authority, (iii) the
contract between the Lessee and the contractor manufacturing such equipment must
be assigned to the Port Authority pursuant to the Assignment Form of Agreement,
and (iv) the Port Authority must receive copies of all executed and supporting
documentation and such other documentation as may be requested by the Port
Authority. If the Port Authority agrees to make Port Authority Payments for
progress of manufacture, the equipment will be subject to inspection and
confirmation by the Port Authority of the value covered by each such Port
Authority Payment. The foregoing requirements must be documented and clearly
identified in each certificate submitted by the Lessee pursuant to paragraph
(d)(1) of this Section covering any such payments.
(n) It is anticipated that due to the duration of the construction
period and need for multiple contracts it is likely that some contracts will be
completed well before the Completion Date. In order to not delay the closeout of
contracts completed to the satisfaction of the Lessee and the Port Authority
prior to the Tentative Final Certificate Date, the Lessee may want to pay the
contractor retainage withheld in accordance with this Section for work performed
and completed in compliance with such contracts and this Lease. If all of the
work covered by a contractor has been completed in accordance with this Lease
and the contract covering the work, the Lessee may request that the Port
Authority inspect such work. If such inspection of the Port Authority confirms
that such work has been so completed, then the Lessee may include in a
certificate submitted by the Lessee to the Port Authority pursuant to paragraph
(d)(1) hereof prior to the Tentative Final Certificate Date that the retainage
withheld by the Port Authority pursuant to paragraph (d)(3) of this Section be
paid to the Lessee. The Lessee shall include with such certificate a release
from the Lessee and from each contractor of all liens or rights of lien for
labor, materials or equipment provided for the specific contract and a release
and discharge of any and all actions, causes of actions, claims and demands of
whatsoever nature or character with respect to the specific contract in the form
attached hereto, hereby made a part hereof and marked "Exhibit 87.2". The Port
Authority may, at its sole discretion, include the amount of such
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retainage in the Port Authority Payment made with respect to the Redevelopment
Work Certificate covering such retainage.
(o) The Lessee's Administrative Amount shall be allocated among the
Allocable Elements of Work as follows: for each of the Cost of the Airside Civil
Work, the Cost of the Landside Civil Work, the Cost of the Passenger Terminal
Work, the Cost of the Parking Garage Work and the Cost of the Terminal 5
AirTrain Connector Work, the amounts equal to the Lessee's Administrative Amount
shall be multiplied by a fraction the numerator of which shall be the total of
all of the Item A Costs for each of the Allocable Elements of Work and the
denominator of which shall be the total of all of the Item A Costs for all
Elements of Work.
SECTION 88. PARKING GARAGE
The Lessee expressly understands and agrees that (1) all use and
operation of the Parking Garage shall be within the sole and exclusive control
of the Port Authority (or of Port Authority permittees, licensees, contractors
or tenants authorized by separate agreement with the Port Authority to use and
or operate the same), (2) that the Lessee shall have no right or claim
whatsoever, legal or equitable, under this Lease or otherwise, to the Parking
Garage or to any income or revenues therefrom, and (3) neither this Agreement
nor the Lessee's payment of any costs or expenses for or relating to the Parking
Garage Work or any portion thereof, or otherwise, shall or shall be deem to
grant or constitute any right, interest or claim of the Lessee in the Parking
Garage or the use or control thereof or the revenues or income therefrom.
SECTION 89. ADDITIONAL RIGHT OF THE PORT AUTHORITY TO TERMINATE A PORTION OF THE
PREMISES
(a) Without limiting any other rights of termination of the Port
Authority under the Lease, in addition to all of the rights of termination of
the Port Authority under this Lease, the Port Authority shall have the right to
terminate this Agreement and the letting thereunder with respect to that portion
of the Premises shown in broken horizontal hatching on Exhibit 89.1 (which
portion of the Premises is herein called "Parcel T"), without cause, at any time
on ninety (90) days' prior notice to the Lessee (the "Parcel T Termination
Notice") in connection with the use of Terminal 6, the redevelopment of the
Terminal 6 site or the construction or reconstruction of roadways associated
with Terminal 6.
(b) Effective as of the date and time stated in the Parcel T
Termination Notice (which date and time are hereinafter in this Section
collectively called the "Parcel T Surrender Date"), the Lessee shall and be
deemed to have granted, bargained, sold, surrendered and yielded up and by these
presents have granted, bargained, sold, surrendered and yielded up unto the Port
Authority, its successors and assigns, forever, its rights in Parcel T and the
term of years with respect thereto under the Lease yet to come and shall and be
deemed to have given, granted, surrendered and by these presents does give,
grant and surrender to the Port Authority, its successors and assigns, all the
rights, rights of renewal, licenses, privileges and options of the Lessee
granted by the Lease with respect to Parcel T, all to the intent and purpose
that the said term under the Lease and the said rights of renewal, licenses,
privileges and options may be wholly merged, extinguished and determined on the
Parcel T Surrender Date, with the same force and effect as if the said term were
in and by the provisions of the Lease originally fixed to
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expire on the Parcel T Surrender Date, but the Lease and the letting thereunder
shall continue in full force and effect as to the remainder of the Premises
under the Lease and in accordance with all the terms and provisions thereof.
TO HAVE AND TO HOLD the same unto the Port Authority, its
successors and assigns forever.
(c) The Lessee hereby covenants on behalf of itself, its successors
and assigns that (x) it has not done or suffered and will not do or suffer
anything whereby Parcel T or the Lessee's leasehold therein, has been or shall
be encumbered as of the Parcel T Surrender Date in any way whatsoever; (y) the
Lessee is and will remain until the Parcel T Surrender Date the sole and
absolute owner of the leasehold estate in Parcel T and of the rights, rights of
renewal, licenses, privileges and options granted by the Lease with respect
thereto and that the same are and will remain until the Parcel T Surrender Date
free and clear of all liens and encumbrances of whatsoever nature; and (z) the
Lessee has full right and power to make this Agreement.
(d) All promises, covenants, agreements and obligations of the Lessee
with respect to Parcel T which under the provisions thereof would have matured
upon the date originally fixed in the Lease for the expiration of the term
thereof, or upon the termination of the Lease prior to the said date, or within
a stated period after expiration or termination shall, notwithstanding such
provisions, mature upon the Parcel T Surrender Date and shall survive the
delivery of the Parcel T Termination Notice by the Port Authority to the Lessee.
(e) As of the Parcel T Surrender Date, the Lessee shall and shall have
released and discharged and does by these presents release and discharge the
Port Authority from any and all obligations on the part of the Port Authority to
be performed under the Lease with respect to Parcel T. The Port Authority does
by these presents release and discharge the Lessee from any and all obligations
on the part of the Lessee to be performed under the Lease with respect to Parcel
T for that portion of the term subsequent to the Parcel T Surrender Date; it
being understood that nothing herein contained shall release, relieve or
discharge the Lessee from any liability for rentals or for other charges that
may be due or become due to the Port Authority for any period or periods prior
to the Parcel T Surrender Date, or for breach of any other obligation on the
Lessee's part to be performed under the Lease for or during such period or
periods or maturing pursuant to the foregoing paragraph, nor shall anything
herein be deemed to release the Lessee from any liability for rentals or other
charges that may be due or become due to the Port Authority for any other
portion of the Premises or for breach of any other obligation on the Lessee's
part to be performed under the Lease.
(f) The Lessee hereby agrees to terminate its occupancy of Parcel T
and to deliver actual, physical possession of Parcel T to the Port Authority, on
or before the Parcel T Surrender Date, in the condition required by the Lease
upon surrender. The Lessee further agrees that it shall remove all the Lessee's
Personal Property from Parcel T prior to the Parcel T Surrender Date, and all
the terms and conditions of Section 29 of the Lease with respect to termination
of the letting shall apply to any of the Lessee's Personal Property not so
removed.
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(g) The Lessee hereby acknowledges that each and every term, provision
and condition of the Lease shall continue to apply to the Premises remaining
after the termination of the Parcel T
(h) From and after the day immediately following the Parcel T
Surrender Date, the Lessee shall be entitled to an abatement of the First Ground
Rental or the Second Ground Rental in accordance with Section 4 hereof.
SECTION 90. WAIVER OF DEPRECIATION
(a) The Lessee hereby irrevocably elects in accordance with Section
142(b)(1)(B)(I) of the Internal Revenue Code of 1986 not to claim for purposes
of federal, state or local taxation of income any depreciation deductions or
investment credits, for which it may be eligible with respect to the Premises or
the Redevelopment Work shall and shall execute such an election on the Lease
Commencement Date and furnish an original counterpart thereof to the Port
Authority. The Lessee further agrees that this irrevocable election shall be
binding upon its successors in interest, if any, under this Agreement, and as a
condition of any permitted sale or assignment of ▇▇▇▇▇▇'s interest under this
Agreement any successor in interest shall furnish an irrevocable election to the
Port Authority in the form executed by the Lessee on the Lease Commencement
Date. The foregoing shall not grant or be deemed to grant to the Lessee the
right to sell or assign, in any manner, its interests under this Agreement.
(b) In the event the Lessee records any documents in lieu of recording
this Agreement, said documents shall incorporate the substance of paragraph (b)
of this Section.
(c) Notwithstanding that any fee title to the Premises shall be in the
City of New York, the Lessee shall not take any position for title, tax and
accounting purposes which is inconsistent with the Port Authority being the
owner of the Redevelopment Work. The foregoing is a special inducement and
consideration to the Port Authority in entering into this Lease with the Lessee
and forms the essence of this Agreement.
SECTION 91. PORT AUTHORITY'S RIGHTS AND THE LESSEE'S CONTINUING OBLIGATIONS WITH
RESPECT TO THE PREMISES AND THE TERMINAL 6 SITE
(a) Subject only to the appropriate written concurrence of the tenants
or users of the Terminal 6 Site, from and after the Parcel T Surrender Date, the
public areas of the Premises and the public areas of the Terminal 6 Site,
including but not limited to arrivals and departure roadways and frontages,
sidewalks, building entrances and doorways, lobbies, hallways, seating areas,
rest rooms, Terminal 5/6 AirTrain Connector and other public facilities, shall
be subject to a joint and mutual easement for pedestrian and vehicular access,
as applicable, to, from and between the Premises and the Terminal 6 Site to be
used jointly by the Lessee, the Port Authority and the lessees, permittees and
other Persons who shall have the permission of the Port Authority now or in the
future to use or occupy all or any portion of the Terminal 6 Site and such
rights of easement for such purposes shall continue during the effective periods
of the respective agreements covering or which may cover the same.
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(b) Subject only to the appropriate written concurrence of the tenants
or users of the Terminal 6 Site, from and after the Parcel T Surrender Date the
area of the Premises as shown in stippled hatching on Exhibit 1.4 together with
the contiguous area of land immediately abutting such portion of the Premises as
shown in crosshatching on Exhibit 1.4 shall be subject to a joint and mutual
easement for the taxiing, push-back, tug-in, turn around and other operations of
aircraft to be used jointly by the Lessee and the lessees, permittees and other
Persons who shall have the permission of the Port Authority now or in the future
to use or occupy all or any portion of the Terminal 6 Site and such rights of
easement for such taxiway purposes shall continue during the effective periods
of the respective agreements covering or which may cover the same.
(c) In addition to all other terms or provisions of this Agreement,
and without limiting any of the same and without limiting, impairing or
diminishing any of the obligations, duties and liabilities of the Lessee under
this Agreement, it is expressly understood and agreed that upon receipt by the
Lessee of a notice from the Port Authority given after the Parcel T Surrender
Date, the Lessee shall promptly commence and within twenty-four months
thereafter complete the following work at its sole cost and expense, subject to
the further terms and conditions of a tenant alteration application (TAA) which
the Lessee, in accordance with Section 33 hereof, shall submit to the Port
Authority for its approval:
(i) all work necessary or appropriate for the relocation of all
lines, pipes, mains, cables, manholes, wires, conduits and other facilities
required in connection with or relating to the mechanical, utility, electrical,
storm sewer, sanitary sewer, communications, security, water, telephone, fire
alarm, fire protection, gas and other systems including but not limited to all
necessary relocations to all necessary valves and other equipment and
accessories necessary to the use and operation of the heating, cooling,
electrical, water, communications and other utility systems serving or which are
to serve the Premises that are located on or within Parcel T so that none of the
foregoing shall interfere with or obstruct the construction of the foundation
structure required for the redevelopment of the Terminal 6 site;
(ii) all work necessary or appropriate to install and accommodate
communication, annunciation and alarming between the fire alarm systems in the
New Passenger Terminal and in the New Terminal 6; and
(iii) all work necessary or appropriate to provide for the
passage of the public between the Terminal 5/6 AirTrain Connector and the New
Terminal 6.
(d) Notwithstanding the surrender of Parcel T by the Lessee, and
notwithstanding anything to the contrary herein or elsewhere in this Agreement,
the Lessee shall continue to be responsible and liable for all environmental
obligations with respect to Parcel T in accordance Section 56 hereof and for any
and all costs or expenses that may be incurred by the Port Authority in
connection therewith; the foregoing to not limit, alter or impair any of the
indemnities from the Lessee to the Port Authority under this Agreement or
otherwise or any other term or provision of this Agreement, or to limit, alter
or impair any other right or remedy of the Port Authority, whether in law,
equity or otherwise.
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(e) In the event the Lessee shall not complete the work set forth in
paragraph (c) of this Section within the 24 months referred to in paragraph (c)
above, such work may be performed, at the Lessee's expense, by the Port
Authority or any new tenant, developer or other occupant or user of Parcel T.
SECTION 92. SECURITY AGREEMENTS
(a) As a condition to, and in consideration of, the Port Authority
entering into this Lease, the Lessee shall execute an agreement in the form
attached hereto, hereby made a part hereof and marked "Exhibit 92.1" (which
security agreement as duly executed by the Port Authority and the Lessee, as the
same may be amended and supplemented, is herein called "Security Agreement
AX-782"). Without limiting the terms and conditions of the Security Agreement
AX-782, the Lessee understands and agrees that a breach of the Security
Agreement AX-782 shall be and be deemed be a breach of this Lease by the Lessee
permitting the Port Authority to terminate this Lease for cause pursuant to
Section 20 hereof.
(b) The Lessee shall notify the Port Authority approximately sixty
(60) days' prior to the Shell Completion Date of the date when the Shell
Completion Date is to occur, which notice is to request that the Port Authority
notify the Lessee of the Initial Security Amount (the "Notice of the Shell
Completion Date").
(c) (1) As used in this Lease the following terms shall have the
respective meanings given below:
(i) "Initial Security Amount" shall mean the amount set
forth in a notice to be given by the Port Authority to the Lessee within thirty
(30) days after the Port Authority's receipt of the Notice of the Shell
Completion Date, which Initial Security Amount shall not exceed the Maximum
Security Amount for the calendar year in which the Shell Completion Date shall
occur.
(ii) "Maximum Security Amount" shall mean with respect to
each calendar year, an amount equal to the quotient obtained by dividing the sum
of the following rentals payable during such calendar year (after taking into
account all abatements and credits applicable thereto for such calendar year) by
the whole number 6:
(aa) First Ground Rental,
(bb) Second Ground Rental,
(cc) Third Ground Rental,
(dd) Fourth Ground Rental,
(ee) Temporary Facility Ground Rental,
(ff) First Enplanement Rental,
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(gg) Second Enplanement Rental,
(hh) First Additional Rental,
(ii) Third Additional Rental,
(jj) Fourth Additional Rental, and
(kk) Fifth Additional Rental;
as the same, solely for the purpose of determining the Maximum Security Amount,
may be estimated prospectively for any calendar year by the Port Authority based
upon any reasonable basis as shall be determined by the Port Authority.
(iii) "Security Amount" shall mean the Initial Security
Amount as the same may be increased by the Port Authority pursuant to the
provisions of paragraph (c)(10) of this Section.
(iv) "Terminal 5 Letter of Credit" shall mean each letter of
credit delivered by the Lessee to the Port Authority pursuant to and in
accordance with this paragraph (c).
(2) On the Shell Completion Date, the Lessee shall cause to be
delivered to the Port Authority as security for the full, faithful and prompt
performance of and compliance with, on the part of the Lessee, of all of the
provisions, terms and conditions of this Lease on its part to be fulfilled,
kept, performed or observed, including without limitation, the payment of all
rentals, fees and other amounts, charges and obligations then or in the future
to become due and owing to the Port Authority by the Lessee pursuant to this
Lease (the "Obligations"), a clean irrevocable letter of credit in the Initial
Security Amount issued to and in favor of the Port Authority by a banking
institution acceptable to the Port Authority and having its main office or a
corresponding branch within the Port of New York District, which letter of
credit shall be payable in the Port of New York District. Such Terminal 5 Letter
of Credit shall provide that it shall be effective as of the Shell Completion
Date and shall continue throughout the period ending six (6) months after the
last to occur of the expiration or earlier termination of this Lease (the
"Effective Period"); such continuance may be by provision for automatic renewal
or by delivery to the Port Authority of a substitute letter of credit
satisfactory to the Port Authority and meeting all the requirements set forth in
this paragraph (c) in an amount so that at all times during the Effective Period
the Port Authority shall have a Terminal 5 Letter of Credit or Terminal 5
Letters of Credit in the Security Amount. The form and terms of each Terminal 5
Letter of Credit, as well as the institution issuing it, shall be subject to the
prior and continuing approval of the Port Authority. If requested by the Port
Authority, any Terminal 5 Letter of Credit delivered pursuant to this paragraph
(c) shall be accompanied by a letter expressing the opinion of counsel for the
banking institution issuing the Terminal 5 Letter of Credit that the issuance of
said Terminal 5 Letter of Credit is an appropriate and valid exercise by the
banking institution of the corporate power conferred upon it by law.
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(3) Upon notice of cancellation of a Terminal 5 Letter of Credit
or upon notice that a Terminal 5 Letter of Credit will not be extended the
Lessee agrees that unless, by a date thirty (30) days prior to the effective
date of such cancellation or expiration, such Terminal 5 Letter of Credit is
replaced by another letter of credit satisfactory to the Port Authority and
meeting all the requirements of subparagraph (c)(2) above in an amount so that
at all times during the Effective Period the Port Authority shall have a
Terminal 5 Letter of Credit or Terminal 5 Letters of Credit in the Security
Amount, the Port Authority may draw down the full amount thereof and thereafter
the Port Authority will hold the same as security under this Agreement.
(4) In addition to any and all other remedies available to it,
the Port Authority shall have the right, at its option at any time and from time
to time, with or without notice, to draw upon each Terminal 5 Letter of Credit
or any part thereof in whole or partial satisfaction of any of its claims or
demands against the Lessee. There shall be no obligation on the Port Authority
to exercise such right and neither the existence of such right nor the holding
of a Terminal 5 Letter of Credit or Terminal 5 Letters of Credit shall cure any
default or breach of this Lease.
(5) If at any time any bank shall fail to make any payment to the
Port Authority in accordance with any Terminal 5 Letter of Credit issued by any
such bank, the Lessee shall cause to be delivered to the Port Authority on
demand another letter of credit satisfactory to the Port Authority and meeting
all the requirements set forth in paragraph (c)(2) above in an amount so that at
all times during the Effective Period the Port Authority shall have a Terminal 5
Letter of Credit or Terminal 5 Letters of Credit in the Security Amount.
(6) If at any time and from time to time during the Effective
Period a payment is made to the Port Authority under any Terminal 5 Letter of
Credit, the Lessee within ten (10) days thereafter shall bring the Terminal 5
Letter of Credit back up to the Security Amount or shall cause to be delivered
to the Port Authority an additional letter of credit satisfactory to the Port
Authority and meeting all the requirements set forth in paragraph (c)(2) above,
in such an amount so that at all times during the Effective Period the Port
Authority shall have a Terminal 5 Letter of Credit or Terminal 5 Letters of
Credit in the Security Amount.
(7) No action by the Port Authority pursuant to the terms of any
Terminal 5 Letter of Credit, or receipt by the Port Authority of funds from any
bank issuing any Terminal 5 Letter of Credit, shall be or be deemed to be a
waiver of any breach or default by the Lessee of this Lease and all rights and
remedies under this Lease, or otherwise consequent upon such breach or default
shall not be affected by the existence of or recourse to any such Terminal 5
Letter of Credit.
(8) After the expiration of the Effective Period, and upon the
condition that the Lessee shall then be in no wise in default of any of the
Obligations, and upon written request therefor by the Lessee, the Port Authority
will return to the Lessee the Terminal 5 Letter of Credit or Terminal 5 Letters
of Credit which have been caused to be delivered to the Port
283
Authority by the Lessee hereunder and are in the possession of the Port
Authority less the amount by partial or full drawings of any and all unpaid
claims and demands (including estimated damages) of the Port Authority by reason
of any default or breach by the Lessee of the Obligations.
(9) The Lessee agrees that it will not assign or encumber any
Terminal 5 Letter of Credit and any such assignment or encumbrance shall be void
as to the Port Authority.
(10) In the event that the Maximum Security Amount shall exceed
the existing Security Amount, the Security Amount may be increased by the Port
Authority, but not more often than once in a calendar year, upon thirty (30)
days' notice to the Lessee to such amount as shall be set forth in such notice,
which amount shall not exceed the Maximum Security Amount. Prior to the
expiration of such thirty (30) day period, the Lessee shall bring the Terminal 5
Letter of Credit up to the new Security Amount set forth in such notice or shall
cause to be delivered to the Port Authority another letter of credit
satisfactory to the Port Authority and meeting all the requirements set forth in
paragraph (c)(2) above in such amount so that the Port Authority shall have a
Terminal 5 Letter of Credit or Terminal 5 Letters of Credit in the new Security
Amount set forth in such notice.
(11) For purposes of this Section, the Lessee hereby certifies
that its I.R.S. Employer Identification No. is: ▇▇-▇▇▇-▇▇▇▇.
(d) In the event that the Lessee has entered into any other agreement
with the Port Authority that provides that any security held by the Port
Authority shall apply to and be available for such other agreement, it is hereby
agreed that notwithstanding the terms and conditions of any such other
agreement, the security held by the Port Authority pursuant this paragraph (c)
or pursuant to Agreement AX-782 shall not be held or available for such other
agreements.
SECTION 93. EFFECT OF TERMINATION BY THE LESSEE
(a) If the Lessee terminates the letting pursuant to the provisions of
paragraph (a)(1) of Section 83 hereof entitled "Termination by Lessee" then the
Port Authority may at its option, pay to the Lessee the Lessee's Unamortized
Investment. Such option shall be evidenced by notice in writing to the Lessee by
the Port Authority within sixty (60) days after the Lessee has given notice of
termination. The failure of the Port Authority to exercise the said option will
impose no obligation upon it to relet the Premises.
(b) If the Lessee terminates the letting pursuant to the provisions of
paragraph (a)(2) of Section 83 hereof entitled "Termination by ▇▇▇▇▇▇" then the
Port Authority may, at its option, pay to the Lessee the Lessee's Unamortized
Investment. Such option shall be evidenced by notice in writing to the Lessee by
the Port Authority within sixty (60) days after the Lessee has given notice of
termination. If the Port Authority fails to exercise such option, then the Port
Authority shall use its best efforts to relet the Premises.
284
(c) If the Port Authority relets the Premises prior to the date upon
which this Lease would have expired but for such termination, then the net rent
paid by the new tenant to the Port Authority (after deducting any costs and
expenses incurred by the Port Authority in securing said new tenant and in
complying with the terms of the lease to such tenant, including but not limited
to costs of alteration and decoration of such Premises, in the event of
termination pursuant to the provisions of paragraph (a)(1) of Section 83 hereof
entitled "Termination by Lessee", and after deducting any costs and expenses
incurred by the Port Authority for the maintenance of said Premises or for
services furnished to the new tenant and after deducting the amounts which would
have been payable as rent by the Lessee but for such termination) shall be paid
over by the Port Authority to the Lessee until said amounts paid over equal the
Lessee's Unamortized Investment as of the date of termination. The obligation of
the Port Authority to pay over to the Lessee any net rent received from such new
tenant shall endure only while such new tenant continues to pay rent and occupy
such Premises, and only while the Lessee's Unamortized Investment is
unamortized, and in no event is such obligation to pay over to endure beyond the
date upon which this Lease would have expired but for such termination.
SECTION 94. DEFINITIONS
For the purposes of this Lease the following terms shall have the
respective meanings given below:
"$.01 Work Cost Savings Sub-total" shall have the meaning given such term
in Subdivision (II)(b) of Section 4 hereof.
"$.008 Work Cost Savings Sub-total" shall have the meaning given such term
in Subdivision (II)(b) of Section 4 hereof.
"$.01 Work Cost Savings" shall have the meaning given such term in
Subdivision (II)(b) of Section 4 hereof.
"$.008 Work Cost Savings" shall have the meaning given such term in
Subdivision (II)(b) of Section 4 hereof.
"5kV Electrical Power and Sanitary Sewer Work" shall have the meaning given
such term in paragraph (m) of Section 2 hereof.
"Abandoned Fuel Lines" shall have the meaning given such term in paragraph
(o) of Section 2 hereof.
"Acceptance Date" shall have the meaning given such term in paragraph (o)
of Section 2 hereof.
"Accommodated Handled Airline" shall mean a Scheduled Aircraft Operator to
whom the Lessee provides Accommodations pursuant to Section 42 or Section 43
hereof and with whom the Lessee has entered into a Handling Agreement and with
whom the Lessee and the Port Authority have entered into a written consent
agreement covering the Port Authority's consent to such Handling Agreement.
285
"Accommodated Sublessee Airline" shall mean a Scheduled Aircraft Operator
to whom the Lessee provides Accommodations pursuant to Section 42 or Section 43
hereof and with whom the Lessee has entered into a sublease agreement and with
whom the Lessee and the Port Authority have entered into a written consent
agreement covering the Port Authority's consent to such sublease agreement.
"Accommodations" shall mean and include:
(i) Use by a Requesting Airline, Accommodated Handled Airline or
Accommodated Sublessee Airline of Gate(s) and Gate Related Premises, on an
exclusive or non-exclusive basis, for its scheduled passenger flight operations;
(ii) Utilities, janitorial services, security, maintenance and repair
and other services and facilities necessary or desirable in connection with the
use described in clause (i) above of this definition;
(iii) Relocation of one or more of the scheduled flight operations of
the Lessee to accommodate such Requesting Airline, Accommodated Handled Airline
or Accommodated Sublessee Airline; and
(iv) The towing by the Lessee of aircraft of the Lessee from a Gate if
such Gate is needed to accommodate the scheduled passenger flight operations of
a Requesting Airline, Accommodated Handled Airline or Accommodated Sublessee
Airline.
"Accommodations Agreement" shall mean each agreement entered into between
the Lessee and a Scheduled Aircraft Operator covering the Lessee's provision of
Accommodations at the Premises pursuant to Section 42 or Section 43 hereof, each
of which shall be subject to the prior written consent of the Port Authority in
accordance with this Lease.
"Activity Based First Enplanement Rental" shall have the meaning given such
term in Subdivision(II)(b) of Section 4 hereof.
"Additional Baseline" shall have the meaning given such term in paragraph
(a) of Section 56 hereof.
"Additional Baseline Work" shall have the meaning given such term in
paragraph (a) of Section 56 hereof.
"Additional Operator" shall have the meaning given such term in paragraph
(a) of Section 80 hereof.
"Additional Sampling Location" shall have the meaning given such term in
paragraph (m) of Section 56 hereof.
286
"Additional Zone" shall have the meaning given such term in paragraph (n)
of Section 56 hereof.
"Adjusted Per Enplanement Rental Rate" shall have the meaning given such
term in Subdivision (II)(b) of Section 4 hereof.
"Adjustment Period" shall have the meaning given such term in Subdivision
(I) of Section 4 hereof.
"Affiliate" shall mean in the singular and "Affiliates" shall mean in the
plural any Person that directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with the
Lessee and any Person in which the Lessee or a shareholder of the Lessee has an
ownership, licensor/licensee or franchiser/franchisee interest or relationship,
but if the Lessee shall be a corporation whose Voting Securities shall be
registered with the Securities and Exchange Commission and publicly traded on a
regular basis then only such shareholder of the Lessee having an ownership
interest greater than five percent (5%). As used in this definition, the term
"control" (including the terms controlling, controlled by and under common
control with) shall mean the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of the Person,
whether through the ownership of Voting Securities, by contract or otherwise.
"Affiliated Scheduled Aircraft Operator" shall have the meaning given such
term in paragraph (b) of Section 19 hereof.
"Affiliated Scheduled Aircraft Operator Arrangement" shall have the meaning
given such term in paragraph (b) of Section 19 hereof.
"Agreement" shall mean this Agreement of Lease.
"Air Terminal Highway" and "Air Terminal Highways" shall mean those
portions of the Airport designated and made available temporarily or permanently
by the Port Authority to the public for general or limited highway use.
"Aircraft" shall mean airplanes, helicopters and every other contrivance
now or hereafter used for the navigation of or flight in air or space.
"Aircraft Operator" shall mean (a) a Person owning one or more aircraft
which are not leased or chartered to any other Person for operation, or (b) a
Person to whom one or more aircraft are leased or chartered for operation
whether the aircraft so owned, leased or chartered are military or non-military,
or are used for private business, pleasure or governmental business, or for
carrier or non-carrier operations, or for scheduled or non-scheduled operations
or otherwise. Said phrase shall not mean the pilot of an aircraft unless he or
she is also the owner or lessee thereof or a Person to whom such aircraft is
chartered.
"Airline Terminal Portion" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
287
"Airline Terminal Portion of the Work" shall have the meaning given such
term in paragraph (o) of Section 2 hereof.
"Airport" shall mean ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport, consisting of
certain premises identified as "▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport" on Sheet
JFK-1 of Exhibit A, and more particularly described in Exhibit B, annexed to the
Basic Lease, and such other property as may be acquired in connection with and
added to such premises pursuant to the terms of the Basic Lease.
"Airport Central Taxi Stack" shall have the meaning given such term in
paragraph (b) of Section 46 hereof.
"Airport Fueling Agreements" " shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
Airside Civil Work" shall have the meaning given in paragraph (b) of
Section 2 hereof.
"Airside Civil Work Item A Costs" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"AirTrain" shall have the meaning given such term in paragraph (a) of
Section 58 hereof.
"AirTrain Moving Sidewalk Maintenance Contract" shall have the meaning
given such term in paragraph (b) of Section 2 hereof.
"AirTrain Vertical Circulation Maintenance Contract" shall have the meaning
given such term in paragraph (b) of Section 2 hereof.
"Allocable Elements of Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Alternative" and "Alternatives" shall have the meaning given such terms in
paragraph (c) of Section 73 hereof.
"Alternative 1" shall have the meaning given such term in paragraph (c) of
Section 73 hereof.
"Alternative 2" shall have the meaning given such term in paragraph (c) of
Section 73 hereof.
"Alternative 3" shall have the meaning given such term in paragraph (c) of
Section 73 hereof.
"Alternative 4" shall have the meaning given such term in paragraph (c) of
Section 73 hereof.
288
"Analyzed Item" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
"Annual Capital Cost" shall have the meaning given such term in paragraph
(a) of Section 53 hereof.
"Annual Period" shall have the meaning given such term in Subdivision (I)
of Section 4 hereof.
"Anticipated Monthly Expenditure Schedule" shall have the meaning given
such term in paragraph (e) of Section 2 hereof.
"ASDO" shall have the meaning given such term in Schedule F attached
hereto.
"ASM" shall have the meaning given such term in paragraph (b) of Section 49
hereof.
"Assignment of Redevelopment Work Contracts and Documents" shall have the
meaning given such term in paragraph (q) of Section 2 hereof.
"Associated Carrying Costs" shall have the meaning given such term in
Subdivision (II)(b) of Section 4 hereof.
"Assumable Maintenance and Repair" shall have the meaning given such term
in paragraph (a) of Section 53 hereof.
"Assumable Maintenance and Repair Date" shall have the meaning given such
term in paragraph (b) of Section 53 hereof."
"Authorized Change Order" shall have the meaning given such term in
paragraph (d) of Section 2 hereof.
"Base Enplanement Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Base Percentage" shall have the meaning given such term in Subdivision
(II)(c) of Section 4 hereof.
"Basic Lease" shall mean the Amended and Restated Agreement of Lease of the
Municipal Air Terminals between The City of New York, as Landlord, and the Port
Authority, as Tenant, dated as of November 24, 2004 and recorded in the office
of the City Register of the City on December 3, 2004 under City Register File
No. 2004000748687, as the same from time to time may have been or may be
supplemented, amended and/or restated.
"BASIS" shall have the meaning given such term in Schedule F attached
hereto.
289
"Bid Conditions" shall have the meaning given such term in Schedule E
attached hereto.
"Books and Records" shall have the meaning given such term in Section 65
hereof entitled "Books and Records".
"Building No. 60" shall mean have the meaning given such term in paragraph
(a) of Section 2 hereof.
"Building No. 60 AirTrain Connector Work" shall have the meaning given such
term in paragraph (a) of Section 87 hereof.
"Business Day" shall mean any day occurring Monday through Friday except
Business Day shall not include any New York State Legal Holidays or any other
days on which the executive offices of the Port Authority are closed.
"Calculated Fourth Additional Rent Amount" shall have the meaning given
such term in Subdivision (II)(c) of Section 4 hereof.
"Capital Cost" shall have the meaning given such term in paragraph (a) of
Section 53 hereof.
"Carrying Cost" shall have the meaning given such term in paragraph (a) of
Section 87 hereof.
"Central Terminal Area" or "CTA" shall have the meaning given such term in
paragraph (a) of Section 68 hereof.
"Change Date" shall have the meaning given such term in paragraph (g) of
Section 43 hereof.
"Change Order" shall have the meaning given such term in paragraph (d) of
Section 2 hereof.
"Change in Control" shall have the meaning given such term in paragraph (a)
of Section 50 hereof.
"Change of Control Date" shall have the meaning given such term in
paragraph (a) of Section 50 hereof.
"Changes in Landlord Rights" shall have the meaning given such term in
Section 51 hereof.
"Chilled Water" shall have the meaning given such term in paragraph (a) of
Section 39 hereof.
290
"City" and "City of New York" shall mean the municipal corporation of the
State of New York known as the City of New York.
"City Insureds" shall mean for any type of insurance required under this
Lease, the City, the City's officials and employees (but only if the Port
Authority's officials and employees are likewise insured), and the New York City
Economic Development Corporation, a local development corporation formed
pursuant to Section 1411 of the Not-for-Profit Corporation Law of the State of
New York, or such successor entity as may be designated by the City.
"Civil Aircraft Operator" shall mean a Person engaged in civil
transportation by aircraft or otherwise operating aircraft for civilian
purposes, whether governmental or private. If any such Person is also engaged in
the operation of aircraft for military, naval or air force purposes, he or she
shall be deemed to be a Civil Aircraft Operator only to the extent that he or
she engages in the operation of aircraft for civilian purposes.
"Claim" and "Claims" shall have the meaning given such terms in paragraph
(e) of Section 61 hereof.
"Cogeneration Agreement" shall have the meaning given such term in
paragraph (a) of Section 39 hereof.
"Cogeneration Facility" shall have the meaning given such term in paragraph
(a) of Section 39 hereof.
"Completion Date" shall have the meaning set forth in paragraph (n) of
Section 2 hereof.
"Comprehensive Plan" shall have the meaning given such term in paragraph
(b) of Section 2 hereof.
"Concession Areas" shall have the meaning given such term in paragraph (b)
of Section 73 hereof.
"Concession Manager" shall have the meaning given such term in paragraph
(c) of Section 73 hereof.
"Concourse" shall have the meaning given such term in paragraph (d) of
Section 73 hereof.
"Condition Exceptions" shall have the meaning given such term in paragraph
(a) of Section 56 hereof.
"Condition Survey" shall have the meaning given such term in paragraph (a)
of Section 54 hereof.
"Condition Survey Contract" shall have the meaning given such term in
paragraph (a) Section 54 hereof.
291
"Condition Survey Contractor" shall have the meaning given such term in
paragraph (a) of Section 54 hereof.
"Condition Survey Report" shall have the meaning given such term in
paragraph (a) of Section 54 hereof.
"Consolidated Counters" shall have the meaning given such term in paragraph
(b) of Section 66 hereof.
"Construction Letter Agreement" shall have the meaning given such term in
Section 71 hereof.
"Construction Work" shall have the meaning given such term in paragraph (b)
of Section 2 hereof.
"Construction Work Dewatering" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Construction Work Indemnified Claim" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Construction Work Indemnified Party" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Contiguous Travel Costs" shall have the meaning given such term in
paragraph (e) of Section 65 hereof.
"Contractor" shall have the meaning given such term in Schedule E attached
hereto.
"Contract Documents" shall have the meaning given such term in paragraph
(g) of Section 2 hereof.
"Cost Category" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Cost of Assumable Maintenance and Repair" shall have the meaning given
such term in paragraph (a) of Section 53 hereof.
"Cost of Port Authority Construction Inspection" shall have the meaning
given such term in paragraph (a) of Section 87 hereof.
"Cost of Port Authority Garage Materials Inspection" shall have the meaning
given such term in paragraph (a) of Section 87 hereof.
292
"Cost of Port Authority Requested Change Order" and "Cost of Port Authority
Requested Change Orders" shall have the meaning given such terms in paragraph
(a) of Section 87 hereof.
"Cost of the Airside Civil Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Cost of the $.01 Work" shall have the meaning given such term in paragraph
(II)(b) of Section 4 hereof.
"Cost of the $.008 Work" shall have the meaning given such term in
paragraph (II) of Section 4 hereof.
"Cost of the Building No. 60 AirTrain Connector Work" shall have the
meaning given such term in paragraph (a) of Section 87 hereof.
"Costs of the Condition Survey" shall have the meaning given such term in
paragraph (a) of Section 54 hereof.
"Cost of the Landside Civil Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Cost of the Lessee's $80 Million Work" shall have the meaning given such
term in paragraph (a) of Section 87 hereof.
"Cost of the Lessee's Redevelopment Work Elements" shall have the meaning
given such term in paragraph (a) of Section 87 hereof.
"Cost of the MOA Curtain Wall Work" shall have the meaning given such term
in paragraph (a) of Section 87 hereof.
"Cost of the Parking Garage Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Cost of the Passenger Terminal Work" shall have the meaning given such
term in paragraph (a) of Section 87 hereof.
"Cost of the Port Authority Redevelopment Work Elements" shall have the
meaning given such term in paragraph (a) of Section 87 hereof.
"Cost of the Redevelopment Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Cost of the Terminal 5 AirTrain Connector Work" shall have the meaning
given such term in paragraph (a) of Section 87 hereof.
293
"CPI" or "Consumer Price Index" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"CPI Change" shall have the meaning given such term in Exhibit 49.1 hereof.
"CPI Percentage Increase" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"CTA" shall have the meaning given such term in paragraph (a) of Section 46
hereof.
"CTA Ground Transportation Service" shall have the meaning given such term
in paragraph (b) of Section 68 hereof.
"CTA Omnibus Service" shall have the meaning given such term in paragraph
(b) of Section 68 hereof.
"CTA Supplementary Service" shall have the meaning given such term in
paragraph (b) of Section 68 hereof.
"Currency Exchange Operator" shall have the meaning given such term in
paragraph (a) of Section 78 hereof.
"Date of the Taking" shall have the meaning given such term in paragraph
(a) of Section 18 hereof.
"DBO" and "Date of Beneficial Occupancy" shall have the meaning given such
term in Subdivision (I) of Section 4 hereof.
"Debt" shall have the meaning given such term in Exhibit 49.1 hereof.
"Debt Financings" shall have the meaning given such term in Exhibit 49.1
hereof.
"DEC" shall mean the New York State Department of Environmental
Conservation.
"DEC Required Remediation" shall have the meaning given such term in
paragraph (s) of Section 2 hereof.
"Defect" shall have the meaning given such term in paragraph (o) of Section
2 hereof.
"Design Development Documents" shall have the meaning given such term in
paragraph (b) of Section 2 hereof.
"Direct or Indirect Beneficial Ownership" shall have the meaning given such
term in paragraph (a) of Section 50 hereof.
294
"Director of Aviation" shall have the meaning given such term in
Subdivision (II)(b) of Section 4 hereof.
"Director of Redevelopment of the Port Authority" shall have the meaning
given such term in paragraph (a) of Section 2 hereof.
"Discharge" shall have the meaning given such term in paragraph (i) of
Section 61 hereof.
"Disposal" shall have the meaning given such term in paragraph (k) of
Section 56 hereof.
"Distribution Portion of the System" shall mean the Distribution Portion of
the System as described in the Airport Fueling Agreements.
"Distribution Portion Work" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
"EEO" shall have the meaning given such term in Schedule E hereof.
"Effective Date" shall have the meaning given such term in the first
paragraph hereof.
"Effective Period" shall have the meaning given such term in paragraph (c)
of Section 92 hereof.
"Element Budget shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Element of Cost" shall have the meaning given such term in paragraph (a)
of Section 87 hereof.
"Element of Work" and "Elements of Work" shall have the meaning given such
term in paragraph (a) of Section 2 hereof.
"Eligible Below Ground Asbestos" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Eligible Below Ground Asbestos Disposal Cost" shall have the meaning given
such term in paragraph (g) of Section 2 hereof.
"Employee Surface Carrier(s)" shall have the meaning given such term in
paragraph (a) of Section 67 hereof.
"Enplanement" shall have the meaning given such term in Subdivision (I) of
Section 4 hereof.
295
"Enplanement Rental" shall have the meaning given such term in Subdivision
(I) of Section 4 hereof.
"Environmental Damages" shall mean any one or more of the following: (i)
the presence in, on, or under the Premises of any Hazardous Substance whether
such presence occurred prior to or during the term of the letting under this
Agreement or resulted from any act or omission of the Lessee or others, and/or
(ii) the disposal, discharge, release or threatened release of any Hazardous
Substance from the Premises or of any Hazardous Substance from under the
Premises and/or (iii) the presence of any Hazardous Substance in, on or under
other property at the Airport as a result of (a) the Lessee's use and occupancy
of the Premises or the performance of the Construction Work or any other work or
activities at the Premises or (b) a migration of a Hazardous Substance from the
Premises or from under the Premises or (c) the Lessee's operations at the
Airport, and/or (iv) any personal injury, including wrongful death, or property
damage, arising out of or related to any Hazardous Substance described in (i),
(ii) or (iii) above, and/or (v) the violation of any Environmental Requirement
pertaining to any Hazardous Substance described in (i), (ii) or (iii) above, the
Premises and/or the activities thereon.
"Environmental Requirement" shall mean in the singular and "Environmental
Requirements" shall mean in the plural all common law and all past, present and
future laws, statutes, enactments, resolutions, regulations, rules, directives,
ordinances, codes, licenses, permits, orders, memoranda of understanding and
memoranda of agreement, guidances, approvals, plans, authorizations,
concessions, franchises, requirements and similar items of all governmental
agencies, departments, commissions, boards, bureaus or instrumentalities of the
United States, states and political subdivisions thereof, all pollution
prevention programs, "best management practices plans", and other programs
adopted and agreements made by the Port Authority (whether adopted or made with
or without consideration or with or without compulsion), with any government
agencies, departments, commissions, boards, bureaus or instrumentalities of the
United States, states and political subdivisions thereof, and all judicial,
administrative, voluntary and regulatory decrees, judgments, orders and
agreements relating to the protection of human health or the environment, and in
the event that there shall be more than one compliance standard, the standard
for any of the foregoing to be that which requires the lowest level of a
Hazardous Substance, the foregoing to include without limitation:
(i) All requirements pertaining to reporting, licensing, permitting,
investigation and remediation of emissions, discharges, releases or threatened
releases of Hazardous Substances into the air, surface water, groundwater or
land, or relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Hazardous Substances, or the
transfer of property on which Hazardous Substances exist;
(ii) All requirements pertaining to the protection from Hazardous
Substances of the health and safety of employees or the public; and
(iii) The Atomic Energy Act of 1954 , 42 U.S.C. Section 2011 et. seq.;
the Clean Water Act also known as the Federal Water Pollution Control Act, 33
U.S.C. Section 1251 et. seq.; the Clean Air Act, 42 U.S.C. Section 7401 et.
seq.; the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. Section
136 et. seq.; the Comprehensive Environmental
296
Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et. seq.; the
Superfund Amendments and Reauthorization Act of 1986 ("▇▇▇▇"), Section 2701 et.
seq. ; the Emergency Planning and Community Right to Know Act, 42 U.S.C. Section
11001 et. seq.; the Occupational Safety and Health Act, 29 U.S.C. Section 651
et. seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Section 5101 et.
seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901 et. seq.; the Toxic Substances Control Act,
15 U.S.C. Section 2601 et. seq.; the Safe Drinking Water Act of 1974, 42 U.S.C.
Sections 300f-300h-11 et. seq.; the New York State Environmental Conservation
Law; the New York State Navigation Law; together, in each case, with any
amendment thereto, and the regulations adopted, guidances, memoranda and
publications promulgated thereunder and all substitutions thereof.
"Equal Employment Opportunity" or "EEO" shall have the meaning given such
term in Schedule E hereof.
"Event of Default" shall have the meaning given such term in Exhibit 92.1
hereof.
"Excess Price" shall have the meaning given such term in paragraph (c) of
Section 68 hereof.
"Exhibit 1.1" shall have the meaning given such term in paragraph (a) of
Section 1 hereof.
"Exhibit 1.3" shall have the meaning given such term in paragraph (c) of
Section 1 hereof.
"Exhibit 1.4" shall have the meaning given such term in paragraph (c) of
Section 1 hereof.
"Exhibit 2.1" shall have the meaning given such term in paragraph (a) of
Section 2 hereof.
"Exhibit 2.2" shall have the meaning given such term in paragraph (a) of
Section 2 hereof.
"Exhibit 2.4" shall have the meaning given such term in paragraph (a) of
Section 2 hereof.
"Exhibit 2.5" shall have the meaning given such term in paragraph (a) of
Section 2 hereof.
"Exhibit 2.6" shall have the meaning given such term in paragraph (a) of
Section 2 hereof.
"Exhibit 2.7" shall have the meaning given such term in paragraph (b) of
Section 2 hereof.
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"Exhibit 2.8" shall have the meaning given such term in paragraph (b) of
Section 2 hereof.
"Exhibit 2.9" shall have the meaning given such term in paragraph (b) of
Section 2 hereof.
"Exhibit 2.10" shall have the meaning given such term in paragraph (b) of
Section 2 hereof.
"Exhibit 2.11" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.12" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.13" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.14" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.15" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.16" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Exhibit 2.17" shall have the meaning given such term in paragraph (m) of
Section 2 hereof.
"Exhibit 2.18" shall have the meaning given such term in paragraph (q) of
Section 2 hereof.
"Exhibit 2.19" shall have the meaning given such term in paragraph (t) of
Section 2 hereof.
"Exhibit 49.1" shall have the meaning given such term in paragraph (a) of
Section 49 hereof.
"Exhibit 56.1" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
"Exhibit 56.2" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
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"Exhibit 56.3" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
"Exhibit 56.4" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
"Exhibit 68.1 " shall have the meaning given such term in paragraph (a) of
Section 68 hereof.
"Exhibit 87.1" shall have the meaning given such term in paragraph (a) of
Section 87 hereof.
"Exhibit 87.2" shall have the meaning given such term in paragraph (d) of
Section 87 hereof.
"Existing Condition" shall have the meaning given such term in paragraph
(a) of Section 56 hereof.
"Existing Tank" and "Existing Tanks" shall have the meaning given such
terms in paragraph (a) of Section 61 hereof.
"Exit Baseline" shall have the meaning given such term in Section 56
hereof.
"Exit Baseline Certificate" shall have the meaning given such term in
paragraph (v) of Section 56 hereof.
"Exit Baseline Report" shall have the meaning given such term in Section 56
hereof.
"Exit Ground Water Threshold Level" shall have the meaning given such term
in Section 56 hereof.
"Exit Soil Threshold Level" shall have the meaning given such term in
Section 56 hereof.
"Expiration Date" shall have the meaning given such term in paragraph (a)
of Section 3 hereof.
"Extended Second Enplanement Rental Abatement End Date" shall have the
meaning given such term in Subdivision (II)(b) of Section 4 hereof.
"Fifth Accrued Amount" shall have the meaning given such term in
Subdivision (II)(e) of Section 4 hereof.
"Fifth Additional Rental" shall have the meaning given such term in
Subdivision (II)() of Section 4 hereof.
299
"Fifth Additional Rental Amount" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Fifth Base Factor" shall have the meaning given such term Subdivision
(II)(c) of Section 4 hereof.
"Fifth Base Factor Product" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Fifth Ground Rental" shall have the meaning given such term in Subdivision
(I) of Section 4 hereof.
"Fifth Project Contingency Payment" shall have the meaning given such term
in Subdivision (II)(c) of Section 4 hereof.
"Fifth Rental Factor" shall have the meaning given such term in Subdivision
(II)(c) of Section 4 hereof.
"Fifth Variable Per Enplanement Rental Rate" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Final Date" shall have the meaning given such term in paragraph (a) of
Section 87 hereof.
"Final Payment Date" shall have the meaning given such term in Subdivision
(I) in Section 4 hereof.
"First Additional Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"First Adjustment Period" shall have the meaning given such term in
Subdivision(I) of Section 4 hereof.
"First Commencement Period" shall have the meaning given such term in
paragraph (a) of Section 43 hereof.
"First Enplanement Date" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"First Enplanement Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"First Ground Rental" shall have the meaning given such term in Subdivision
(I) of Section 4 hereof.
300
"First Temporary Enplanement Date" shall have the meaning given such term
in Subdivision (I) of Section 4 hereof.
"First Variable Per Enplanement Rental Rate" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Flight Wing I Tube" shall have the meaning given such term in paragraph
(a) of Section 2 hereof.
"Flight Wing II Tube" shall have the meaning given such term in paragraph
(a) of Section 2 hereof.
"Foreign Currency Exchange Service" shall have the meaning given such term
in paragraph (a) of Section 78.
"Fourth Additional Monthly Percentage" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
"Fourth Additional Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Fourth Additional Rental Adjustment" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
Fourth Additional Rental Commencement Date" shall have the meaning given
such term in Subdivision (II) of Section 4 hereof.
"Fourth Pre-DBO Rental Factor" shall have the meaning given such term in
Subdivision (II) of Section 4 hereof.
"Fourth Ground Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Fourth Pre-DBO Rental Factor" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Fourth Variable Per Enplanement Rental Rate" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Free Product" shall have the meaning given such term in paragraph (g) of
Section 2 hereof.
"Fuel Line Risks" shall have the meaning given such term in paragraph (o)
of Section 2 hereof.
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"Fuel Line Work" shall have the meaning given such term in paragraph (o) of
Section 2 hereof.
"Full Enplanement Rental Commencement Date" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Gate" shall mean in the singular an airline passenger aircraft loading and
unloading building gate position at the Premises and "Gates" shall mean in the
plural more than one airline passenger aircraft loading and unloading building
gate position at the Premises.
"Gate Related Premises" shall mean as to each Gate in the Premises, all
related (as determined by the Port Authority) aircraft ramp and gate position
capacity and related passenger terminal space and facilities including, but not
limited to, passenger ticketing, passenger check-in, baggage handling and flight
information systems, passenger lounge and waiting areas, holding rooms, loading
bridges, baggage claims and appropriate signage and public identification, and
such other facilities reasonably required for the functional use of a Gate or
Gates.
"General Airport Agreement" shall mean those certain agreements and leases
of premises entitled "▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport," dated as of
January 1, 1953 entered into by the Port Authority with various Aircraft
Operators (as the same may have been supplemented, amended and extended) which
governed the rights, privileges, duties and obligations of and between the
parties thereto with respect to the Airport and which continue to govern the
rights, privileges, duties and obligations of and between the Port Authority and
the Aircraft Operators at the Airport with respect to the Airport hydrant
fueling system and fueling fees, as the same has been extended by the Standstill
Agreement and the Second Standstill Agreement.
"General Constructions Costs" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"General Contractor" shall have the meaning given such term in paragraph
(g) of Section 2 hereof.
"General Manager of the Airport" shall mean the person or persons from time
to time designated by the Port Authority to exercise the powers and functions
vested in the said General Manager by this Agreement; but until further notice
from the Port Authority to the Lessee it shall mean the General Manager (or the
temporary or acting General Manager) of the Airport for the time being, or his
duly designated representative or representatives.
"Governmental Authority", "Governmental Board" and "Governmental Agency"
shall each mean federal, state, municipal and other governmental authorities,
boards and agencies of any state, nation or government, except that they shall
not be construed to include The Port Authority of New York and New Jersey, the
lessor under this Agreement.
"Gross Receipts" shall mean and include all monies paid or payable to an
Operator for sales made and for services rendered at or from the Premises, and
outside the Premises, if the
302
order therefor is received at the Premises, and any other revenues of any type
arising out of or in connection with the Operator's operations at the Premises,
provided, however, that any taxes or other governmental charges imposed by law
which are separately stated to and paid by a customer and directly payable to
the taxing authority by the Operator, shall be excluded therefrom, provided,
further, however, with respect Alternative 4, the term "Gross Receipts" as such
term is used in Sections 59, 73, 74, 75, 77, 78 and 80 hereof shall mean with
respect to the Lessee monies paid or payable to the Lessee for sales made and
for services rendered by the Lessee pursuant to or in connection with Sections
59 and 73 through 82 hereof.
"Ground Carrier Permittees" shall have the meaning given such term in
paragraph (b of Section 67 hereof.
"Ground Rental Base Rate" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Ground Transportation Operators" shall have the meaning given such term in
paragraph (a) of Section 66 hereof.
"Group VI Aircraft" shall have the meaning given such term in paragraph (a)
of Section 2 hereof.
"Ground Water Threshold Level" shall have the meaning given such term in
paragraph (j) of Section 56 hereof.
"Guaranteed Annual Enplanements" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Guide" shall have the meaning given such term in paragraph (f) of Section
43 hereof.
"Handled Airlines" shall mean any Requesting Airline, Accommodated Handled
Airlines, Accommodated Sublessee Airlines and any other Scheduled Aircraft
Operators who are operating at the Airport pursuant to accommodations provided
by the Lessee, whether pursuant to a sublease agreement, Handling Agreement or a
combination of both, which agreement has been consented to by the Port Authority
and which consent remains in full force and effect.
"Handling Agreement" shall mean a ground handling or handling agreement, as
such terms are used and understood in the aviation industry, or any other
agreement entered in to between the Lessee and an Aircraft Operator whereby the
Lessee provides the types of services provided by a handling Aircraft Operator
to a handled Aircraft Operator under a ground handling or handling agreement, it
being understood and agreed that the Lessee shall have no right to enter into a
Handling Agreement without the prior written consent of the Port Authority.
"Hazardous Substance" shall mean and include in the singular and "Hazardous
Substances" shall mean and include in the plural any pollutant, contaminant,
toxic or hazardous waste, dangerous substance, noxious substance, toxic
substance, flammable, explosive or radioactive material, urea formaldehyde foam
insulation, asbestos, polychlorinated biphenyls
303
("PCBs"), chemicals known to cause cancer, endocrine disruption or reproductive
toxicity, petroleum and petroleum products and other substances which have been
or in the future shall be declared to be hazardous or toxic, or the removal,
containment or restriction of which have been or in the future shall be
required, or the manufacture, preparation, production, generation, use,
maintenance, treatment, storage, transfer, handling or ownership of which have
or in the future shall be restricted, prohibited, regulated or penalized by any
federal, state, county, or municipal or other local statute or law now or at any
time hereafter in effect as amended or supplemented and by the regulations
adopted and publications promulgated pursuant thereto.
"Hazardous Waste" shall have the meaning given such term in Section 261.3
of 40 CFR Part 261, Subpart A, as such meaning may be amended from time to time
in paragraph (a) of Section 2 hereof.
"Hot Water" shall have the meaning given such term in paragraph (a) of
Section 39 hereof entitled "Hot Water and Chilled Water Requirements".
"Immaterial Change" shall have the meaning given such term in paragraph (d)
of Section 2 hereof.
"Immaterial Change Order" shall have the meaning given such term in
paragraph (d) of Section 2 hereof.
"Incremental Dewatering Cost" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Incremental Per Ton Cost of the Shared Soil Disposal Work" shall have the
meaning given such term in paragraph (g) of Section 2 hereof.
"Incremental Soil Disposal Costs" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Indebtedness" shall have the meaning given such term in Exhibit 49.1
hereof.
"Indemnified Claim" shall have the meaning given such term in paragraph (a)
of Section 13 hereof .
"Indemnified Party" shall have the meaning given such term in paragraph (a)
of Section 13 hereof.
"In-Flight Meal Operator" shall have the meaning given such term in
paragraph (a) of Section 72 hereof.
"In-Flight Meals" as used in the air transportation industry and in this
Agreement is a term of art and includes food, beverages, snacks, non-reusable
supplies, materials, dry goods and all services rendered in connection
therewith.
304
"Initial Base Enplanement Rental" shall have the meaning given such term in
paragraph (I) of Section 4 hereof.
"Initial Base Guaranteed Annual Enplanements" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Initial Fourth Ground Rental Abatement Rate" shall have the meaning given
such term in Subdivision (III)(d) of Section 4 hereof.
"Initial Minimum Enplanement Rental" shall have the meaning given such term
in Subdivision (I) of Section 4 hereof.
"Initial Post Construction Baseline" shall have the meaning given such term
in Exhibit 56.1 attached hereto.
"Initial Post Construction Baseline Certificate" shall have the meaning
given such term in paragraph (m) of Section 56 hereof.
"Initial Post Construction Baseline Effective Date" shall have the meaning
given such term in Section 56 hereof.
"Initial Post Construction Baseline Work" shall have the meaning given such
term in Section 56 hereof.
"Initial Second Ground Rental Abatement Rate" shall have the meaning given
such term in Subdivision (III)(b) of Section 4 hereof.
"Initial Security Amount" shall have the meaning given such term in
paragraph (c) of Section 92 hereof.
"Initial Third Ground Rental Abatement Rate" shall have the meaning given
such term in Subdivision (III) of Section 4 hereof.
"Initial Price" shall have the meaning given such term in paragraph (c) of
Section 68 hereof.
"Item A Costs" shall have the meaning given such term in paragraph (a) of
Section 87 hereof.
"Itinerant Aircraft" shall have the meaning given such term in paragraph
(a) of Section 70 hereof.
"JFK Flight Fees Agreements" shall mean the separate agreements designated
therein as JFK Flight Fees Agreements effective as of January 1, 2004 entered
into between the Port Authority and various Aircraft Operators at the Airport
(described therein as "Signatory
305
Airlines") covering the payment of flight fees at the Airport and the other
matters covered thereby.
"JFK SPDES Permit" shall have the meaning given such term in paragraph (g)
of Section 2 hereof.
"KIAC" shall have the meaning given such term in paragraph (a) of Section
39 hereof.
"Landside Civil Work" shall have the meaning given in paragraph (b) of
Section 2 hereof.
"Landside Civil Work Item A Costs" shall have the meaning given such term
in paragraph (a) of Section 87 hereof.
"Lease" shall mean this Agreement of Lease.
"Lease AYD-265" shall have the meaning given such term in paragraph (g) of
Section 1 hereof.
"Lease Commencement Date" shall have the meaning given such term in the
initial Witnesseth paragraph hereof.
"Leased Premises" shall have the meaning given such term in Exhibit 87.1
hereof.
"Lessee" shall mean JetBlue Airways Corporation, a corporation of the State
of Delaware.
"Lessee Change Order" shall have the meaning given such term in paragraph
(d) of Section 2 hereof.
"Lessee Environmental Representative" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Lessee Hazardous Substance" shall have the meaning given such term in
paragraph (q) of Section 56 hereof.
"Lessee Proposed Change" shall have the meaning given such term in
paragraph (d) of Section 2 hereof.
"Lessee Tank" and "Lessee's Tanks" shall have the meaning given such terms
in paragraph (a) of Section 61 hereof.
"Lessee's $80 Million Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Lessee's Act" shall have the meaning given such term in paragraph (a) of
Section 56 hereof.
306
"Lessee's Administrative Amount" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Lessee's Basic Schedule for 2009" shall have the meaning given such term
in paragraph (b) of Section 43 hereof.
"Lessee's Commencement Basic Schedule" shall have the meaning given such
term in paragraph (a) of Section 43 hereof.
"Lessee's Cost of the Exit Baseline" shall have the meaning given such term
in Section 56 hereof.
"Lessee's Cost of the Initial Post Construction Baseline" shall have the
meaning given such term in Section 56 hereof.
"Lessee's Dewatering Permit" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Lessee's Dewatering System" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Lessee's Eligible Below Ground Asbestos Disposal Costs" shall have the
meaning given such term in paragraph (g) of Section 2 hereof.
"Lessee's Incremental Dewatering Costs" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Lessee's Personal Property" shall have the meaning given such term in
paragraph (a) of in Section 29 hereof.
"Lessee's Shared Environmental Costs" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Lessee's Soil Disposal Costs" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Lessee's Unamortized Investment" shall mean an amount equal to the lesser
of (x) Eighty Million Dollars and No Cents ($80,000,000.00) or (y) the s Cost of
the Lessee's $80 Million Work, after deduction from such lesser amount, of an
amount equivalent to an allowance for depreciation and amortization; such
allowance to be computed on a straight-line basis from the earlier of (i) the
fifth (5th) anniversary of the Lease Commencement Date or (ii) DBO to the end of
the average useful life thereof (as determined under generally accepted United
States accounting principles) or the Expiration Date, whichever is the shorter.
The foregoing computation to be made shall not take into consideration the
effect of accelerated amortization, if
307
any, granted to or taken by the Lessee on its books or otherwise under the
provisions of Section 168(a) of Title 26 USCA or similar legislation hereafter
enacted.
"Letter of Credit" shall have the meaning given such term in Exhibit 92.1
hereof.
"Local Business Enterprise" or "LBEs" shall have the meaning given such
term in Schedule F attached hereto.
"Long Island Well Permit" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Material Change" shall have the meaning given such term in paragraph (d)
of Section 2 hereof.
"Material Change Order" shall have the meaning given such term in paragraph
(d) of Section 2 hereof.
"Material Part" shall have the meaning given such term in paragraph (a) of
Section 18 hereof.
"Matter" shall have the meaning given such term in paragraph (k) of Section
56 hereof.
"Maximum Security Amount" shall have the meaning given such term in
paragraph (c) of Section 92 hereof.
"Meaningful Participation" shall have the meaning given such term in
Schedule E hereof.
"Measuring Period" shall have the meaning given such term in paragraph (f)
of Section 43 hereof.
"Memorandum of Agreement" and "MOA" shall mean the memorandum of agreement
entered into between and among the Port Authority, the New York State Historic
Preservation Office, the Federal Aviation Administration and the Advisory
Council on Historic Preservation for the rehabilitation, restoration, and
adaptive reuse of Building No. 60, a copy of which is attached hereto, hereby
made a part hereof and marked "Exhibit 94".
"Metro Area" shall have the meaning given such term in paragraph (f) of
Section 73 hereof.
"Migrated Hazardous Substances" shall have the meaning given such term in
paragraph (a) of Section 56 hereof.
"Minimum Enplanement Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
308
"Minimum First Enplanement Rental" shall have the meaning given such term
in Subdivision (II)(b) of Section 4 hereof.
"Minority" shall have the meaning given such term in Schedule E hereof.
"Minority Business Enterprise" or "MBE" shall have the meaning given such
term in Schedule E.
"MOA Curtain Wall Work" shall have the meaning given such term in paragraph
(b) of Section 2 hereof.
" MOA Flight Wing II Work" shall have the meaning given such term in
paragraph (b) of Section 2 hereof.
"Monthly Percentage" shall have the meaning given such term in Subdivision
(II)(c) of Section 4 hereof.
"Monthly Period" shall have the meaning given such term in Subdivision (I)
of Section 4 hereof.
"Net Cost of Port Authority Requested Change Orders" shall have the meaning
given to such term in paragraph (a) of Section 87 hereof.
"New Airport Fueling Agreements" shall mean such of the separate agreements
or agreements if and when entered into by the Port Authority and airlines
granting at the Airport which would cover the operations of the Airport Fuel
Storage and Distribution System in replacement of the aviation fuel provisions
of the General Airport Agreement.
"New Isolation Valve Pit" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
"New Passenger Terminal" shall have the meaning given in paragraph (a) of
Section 2 hereof.
"New System Components" shall have the meaning given such term in paragraph
(o) of Section 2 hereof.
"Newsstand Operator" shall have the meaning given such term in paragraph
(a) of Section 77.
"Non-Related Entity" shall have the meaning given such term in paragraph
(c) of Section 73 hereof.
"Notice of Shell Completion Date" shall have the meaning given such term in
paragraph (b) of Section 92 hereof.
309
"Notice of Termination" shall have the meaning given such term in paragraph
(a) of Section 20 hereof.
"NYPT" shall have the meaning given such term in paragraph (d) of Section
73 hereof.
"Obligations" shall have the meaning given such term in paragraph (c) of
Section 92 hereof.
"Obligor" shall have the meaning given such term in Exhibit 92.1 hereof.
"Off-Premises Utility Service Line Work" shall have the meaning given such
term in paragraph (m) of Section 2 hereof.
"Operation and Maintenance Cost" shall have the meaning given such term in
paragraph (a) of Section 53 hereof.
"Operator" shall mean and include each and every Retail Manager, Restaurant
Operator, Newsstand Operator, Currency Exchange Operator, Retail Bank Operator,
Additional Operator, Employee Surface Carrier, Ground Carrier Permittee,
Passenger Surface Carrier, In-flight Meal Operator and any other Person who
conducts any business or operations on or at the Premises and for which the Port
Authority shall impose a fee or rental on the conduct of such business and
operations.
"Optional Expiration Date" shall have the meaning given such term in
paragraph (b) of Section 3 hereof.
"Other Users" shall mean the meaning given such term in paragraph (o) of
Section 2 hereof.
"Outstanding Claim" shall have the meaning given such term in paragraph (a)
of Section 87 hereof.
"Parcel T" shall have the meaning given such term in paragraph (a) of
Section 89 hereof.
"Parcel T Surrender Date" shall have the meaning given such term in
paragraph (b) of Section 89 hereof.
"Parcel T Termination Notice" shall have the meaning given such term in
paragraph (a) of Section 89 hereof.
"Parcel Z" shall have the meaning given such term in paragraph (c) of
Section 5 hereof.
"Parcel Z Approval Plan" shall have the meaning given such term in
paragraph (c) of Section 5 hereof.
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"Parking Garage" shall have the meaning given in paragraph (a) in Section 2
hereof.
"Parking Garage Basis of Design" shall have the meaning given in paragraph
(a) of Section 2 hereof.
"Parking Garage Circulation Facilities" shall have the meaning given in
paragraph (b) Section 2 hereof.
"Parking Garage DEC Delay" shall have the meaning given such term in
paragraph (s) of Section 2 hereof.
"Parking Garage DEC Delay Costs" shall have the meaning given such term in
paragraph (s) of Section 2 hereof.
"Parking Garage Fire Safety Equipment Maintenance Contract" shall have the
meaning given such term in paragraph (b) of Section 2 hereof.
"Parking Garage Site" shall have the meaning given in paragraph (a) in
Section 2 hereof.
"Parking Garage Vertical Circulation Maintenance Contract" shall have the
meaning given such term in paragraph (b) of Section 2 hereof.
"Parking Garage Work" shall have the meaning given in paragraph (b) of
Section 2 hereof.
"Parking Garage Work Completion Date" shall have the meaning given such
term in paragraph (n) of Section 2 hereof.
"Parking Garage Work Item A Costs" shall have the meaning given such term
in paragraph (a) of Section 87 hereof.
"Participants" shall have the meaning given such term in paragraph (d) of
Section 68 hereof.
"Passenger Surface Carrier or Carriers" shall have the meaning given such
terms in paragraph (d) of Section 67 hereof.
"Passenger Terminal Work" shall have the meaning set forth in paragraph (b)
of Section 2.
"Passenger Terminal Work Item A Costs" shall have the meaning given such
term in paragraph (a) of Section 87 hereof.
"Per Enplanement Rental Rate" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
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"Per Ton Cost of the Shared Soil Disposal Work" shall have the meaning
given such term in paragraph (g) of Section 2 hereof.
"Period of Underutilization" shall have the meaning given such term in
paragraph (d) of Section 43 hereof.
"Permitted Modification" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
"Person" shall mean not only a natural person, corporation or other legal
entity, but also two or more natural persons, corporations or other legal
entities acting jointly as a firm, partnership, unincorporated association,
consortium, joint adventurers or otherwise.
"Port Authority" shall mean the Port Authority of New York and New Jersey,
a body corporate and politic, established by Compact between the States of New
Jersey and New York with the consent of the Congress of the United States of
America.
"Port Authority Backfill Costs" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Port Authority Delay Costs" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Port Authority Eligible Below Ground Asbestos Disposal Costs" shall have
the meaning given such term in paragraph (g) of Section 2 hereof.
"Port Authority Incremental Dewatering Costs" shall have the meaning given
such term in paragraph (g) of Section 2 hereof.
"Port Authority Non-Shared Soil" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Port Authority Non-Shared Soil Disposal Costs" shall have the meaning
given such term in paragraph (g) of Section 2 hereof.
"Port Authority Payment" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Port Authority Payment Work" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Port Authority Requested Change" shall have the meaning set forth in
paragraph (d) of Section 2 hereof.
"Port Authority Requested Change Order" shall have the meaning set forth in
paragraph (d) of Section 2 hereof.
312
"Port Authority Service Contract" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Port Authority Shared Soil" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Port Authority's Cost of the Exit Baseline" shall have the meaning given
such term in Section 56 hereof.
"Port Authority's Share of the Cost of the Lessee's Project Contingency
Costs" shall have the meaning given such term in paragraph (a) of Section 87
hereof.
"Port Authority's Share of the Cost of the Lessee's Redevelopment Work
Elements" shall have the meaning given such term in paragraph (a) of Section 87
hereof.
"Port Authority's Shared Soil Disposal Costs"" shall have the meaning given
such term in paragraph (g) of Section 2 hereof.
"Port of New York District" shall have the meaning set forth in Article II
of the Compact.
"Post Construction Baseline" shall have the meaning given such term in
paragraph (a) of Section 56 hereof.
"Post-DBO Accrued Amount" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Post-DBO Additional Rental Commencement Date" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Post-DBO Base Factor" shall have the meaning given such term in
Subdivision II (c) of Section 4 hereof.
"Post-DBO Base Factor Product" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Post-DBO Project Contingency Payment" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
"Post-DBO Rental Factor" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Post-DBO Third Additional Rental Amount" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
313
"Pre-DBO Additional Rental Amount" shall have the meaning given such term
in Subdivision (II)(c) of Section 4 hereof.
"Pre-DBO Base Factor" shall have the meaning given such term in Subdivision
(II)(c) of Section 4 hereof.
"Pre-DBO Base Factor Product" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Pre-DBO Payment Accrued Amount" shall have the meaning given such term in
Subdivision (II)(c) of Section 4 hereof.
"Pre-DBO Project Contingency Payment" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
"Pre-DBO Rental Factor" shall have the meaning given such term in
Subdivision (II)(d) in Section 4 hereof.
"Premises" shall have the meaning given such term in paragraph (a) of
Section I hereof.
"Premises Circulation Facilities" shall have the meaning set forth in
paragraph (b) of Section 2 hereof.
"Premises Distribution Line" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
"Prior Work" shall have the meaning given such term in Section 71 hereof.
"Project Budget" shall have the meaning given such term in paragraph (e) of
Section 2 hereof.
"Project Contingency Payment" and "Project Contingency Payments" shall have
the meanings given such terms in paragraph (a) of Section 87 hereof.
"Project Costs" " shall have the meaning given such term in paragraph (a)
of Section 2 hereof.
"Proposed Change" shall have the meaning given such term in paragraph (d)
of Section 2 hereof.
"Pro-Rata Share" shall mean with respect to each Gate at the Premises,
3.84615%.
"Public Aircraft Facilities" shall mean the following facilities, as they
may from time to time be provided and maintained by the Port Authority at the
Airport for public and common use, including use by Civil Aircraft Operators,
for the following purposes and which (except as provided in Section 12.12 of the
General Airport Agreement or Section 14 of the JFK Flight Fees
314
Agreement, as applicable) are usable for such purposes regardless of whether or
not they are actually used or usable in whole or in part by the Lessee:
(i) Public Aircraft Parking and Storage Area; and
(ii) Public Ramp and Apron Area; and
(iii) Runways; and
(iv) Taxiways; and
(v) Facilities Incidental to the Runways, Ramp and Apron Area,
Aircraft Parking and Storage Area and Taxiways.
"Public Aircraft Parking and Storage Space" shall mean space at the Airport
for the purpose of parking and storing Aircraft, for the purpose of servicing
Aircraft with fuel and lubricants and other supplies for use thereon, and for
the purpose of making minor or emergency repairs to Aircraft.
"Public Landing Area" shall mean the area of land at the Airport including
Runways, Taxiways and the areas between and adjacent to Runways and Taxiways,
designated and made available from time to time by the Port Authority for the
landing and taking off of aircraft.
"Public Ramp and Apron Area" shall mean the area adjacent to the Public
Landing Area designated and made available from time to time by the Port
Authority for common use for the loading or unloading of passengers or cargo to
or from aircraft using the Public Landing Area.
"QF Status" shall have the meaning given such term in paragraph (b) of
Section 39 hereof.
"Qualified Assignee" shall have the meaning given such term in paragraph
(a) of Section 19 hereof.
"RAC" and "Redevelopment Advisory Committee" shall have the meaning given
such term in paragraph (c) of Section 2 hereof.
"RCS" shall have the meaning given such term in paragraph (b) of Section 2
hereof.
"Re-designated Airline Terminal Portion of the System" shall have the
meaning given such term in paragraph (o) of Section 2 hereof.
"Redesignation Date" shall have the meaning given such term in paragraph
(o) of Section 2 hereof.
"Redevelopment of Terminal 5/6 FONSI/ROD" shall have the meaning given such
term in paragraph (a) of Section 2 hereof.
315
"Redevelopment Work" shall have the meaning set forth in paragraph (b) of
Section 2 hereof.
"Redevelopment Work Certificate" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Redevelopment Work Contract" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Redevelopment Work Contracts and Documents" shall have the meaning given
such term in paragraph (a) of Section 2 hereof.
"Redevelopment Work Contractor" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Redevelopment Work Construction Applications" shall have the meaning given
in paragraph (a) of Section 2 hereof.
"Redevelopment Work Project Schedule" shall have the meaning given such
term in paragraph (e) of Section 2 hereof.
"Redevelopment Work Site" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Reference Month" shall have the meaning given such term in Subdivision (I)
of Section 4 hereof.
"Related Entity" shall have the meaning given such term in paragraph (c) of
Section 73 hereof.
"Relocation Work" shall have the meaning given such term in paragraph (m)
of Section 2 hereof.
"Remedial Action Work Plan" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Remediation Completion Report" shall have the meaning given such term in
paragraph (n) of Section 56 hereof.
"Removed Material" shall have the meaning given such term in paragraph (g)
of Section 2 hereof.
"Report Date" shall have the meaning given such term in paragraph (a) of
Section 54 hereof.
316
"Requesting Airline" shall have the meaning given such term in paragraph
(a) of Section 42 hereof .
"Reserved Uses" shall have the meaning given such term in paragraph (d) of
Section 73 hereof.
"Resident Engineer" shall have the meaning given such term in paragraph (a)
of Section 2 hereof.
"Restaurant Operator" shall have the meaning given such term in paragraph
(a) of Section 74 hereof.
"Retail Bank Operator" shall have the meaning given such term in paragraph
(a) of Section 79 hereof.
"Retail Banking Service" shall have the meaning given such term in
paragraph (a) of Section 79 hereof.
"Return Date of the Assumable Maintenance and Repair" shall have the
meaning given such term in paragraph (f) of Section 53 hereof.
"Revenue Seats Daily Average" shall have the meaning given such term in
paragraph (f) of Section 43 hereof.
"RPM" shall have the meaning given such term in paragraph (b) of Section 49
hereof.
"Runways" shall mean runways (including aerial approaches) at the Airport
used for the purpose of the landing and taking-off of Aircraft.
"Satellite Portion Work" shall have the meaning given such term in
paragraph (o) of Section 2 hereof.
"Schedule E" shall have the meaning given such term in paragraph (g) of
Section 2 hereof.
"Schedule F" shall have the meaning given such term in paragraph (g) of
Section 2 hereof.
"Scheduled Aircraft Operator" shall mean a Civil Aircraft Operator engaged
in transportation by aircraft operated wholly or in part on regular flights to
and from the Airport in accordance with published schedules; but so long as the
Federal Aviation Act of 1958, or any similar federal statute providing for the
issuance of Foreign Air Carrier Permits or Certificates of Public Convenience
and Necessity or substantially similar permits or certificates, is in effect, no
Person shall be deemed to be a Scheduled Aircraft Operator within the meaning of
this Agreement unless it also holds such a permit or certificate.
317
"Second Additional Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Second Enplanement Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Second Enplanement Rental Abatement End Date" shall have the meaning given
such term in Subdivision (II)(b) of Section 4 hereof.
"Second Ground Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Second Ground Rental Commencement Date" shall have the meaning given such
term in Subdivision (II)(a) of Section 4 hereof.
"Second Standstill Agreement" shall mean the certain agreement entered into
between the Port Authority and the Lessee covering the extension of the General
Airport Agreement through September 30, 2004, or through such later date as may
thereafter be agreed upon by extension, restatement or modification of such
agreement, with the extension of the fuel fee provisions of the General Airport
Agreement extended through December 31, 2004, or through such later date as may
thereafter be agreed upon by
"Second Variable Per Enplanement Rental Rate" shall have the meaning given
such term in Subdivision (I) of Section 4 hereof.
"Section 42 Gate Termination Date" shall have the meaning given such term
in paragraph (d) of Section 42 hereof.
"Section 42 Gate Termination Notice" shall have the meaning given such term
in paragraph (d) of Section 42 hereof.
"Section 42 Notice to Provide Accommodations" shall have the meaning given
such term in paragraph (b) of Section 42 hereof.
"Section 42 Notice Period" shall have the meaning given such term in
paragraph (b) of Section 42 hereof.
"Section 42 Terminated Gate" shall have the meaning given such term in
paragraph (d) of Section 42 hereof.
"Section 43 Gate Termination Notice" shall have the meaning given such term
in paragraph (c) of Section 43 hereof.
"Section 43 Gate Termination Date" shall have the meaning given such term
in paragraph (e) of Section 43 hereof.
318
"Section 43 Notice to Provide Accommodations" shall have the meaning given
such term in paragraph (c) of Section 43 hereof.
"Section 43 Terminated Gate" shall mean each Gate and its Gate Related
Premises for which the letting is terminated pursuant to the provisions of
Section 43 hereof.
"Security Agreement AX-782" shall mean have the meaning given such term in
paragraph (a) of Section 92 hereof.
"Security Amount" shall have the meaning given such term in paragraph (c)
of Section 92 hereof.
"Shared Soil" shall have the meaning given such term in paragraph (g) of
Section 2 hereof.
"Shell Completion Work" shall have the meaning given such term in paragraph
(a) of Section 87 hereof.
"Shell Completion Date" shall have the meaning given such term in paragraph
(a) of Section 87 hereof.
"Soft Costs" shall have the meaning given such term in paragraph (a) of
Section 87 hereof.
"Soil Threshold Level" shall have the meaning given such term in paragraph
(j) of Section 56 hereof.
"Soil Management Plan" shall have the meaning given such term in paragraph
(g) of Section 2 hereof.
"Specified Amount" shall have the meaning given such term in Exhibit 49.1
hereof.
"Staging Area" shall have the meaning given such term in paragraph (t) of
Section 2 hereof.
"Staging Area Termination Date" shall have the meaning given such term in
paragraph (t) of Section 2 hereof.
"Standstill Agreement" shall mean the certain agreement entered into
between the Port Authority and the Lessee covering the extension of the General
Airport Agreement through March 31, 2004.
"Standstill Agreements" shall mean collectively the Standstill Agreement
and the Second Standstill Agreement.
319
"Street Prices" shall have the meaning given such term in paragraph (f) of
Section 73 hereof.
"Street Pricing" shall have the meaning given such term in paragraph (f) of
Section 73 hereof.
"Submissions" shall have the meaning given such term in paragraph (c) of
Section 68 hereof.
"Subsidiary" shall mean any corporation or other Person of which securities
or other interests having the power to elect a majority of the corporation's or
other Person's board of directors or similar governing body, or otherwise having
the power to direct the business and policies of that corporation or other
Person, are held by the Lessee or one or more of its Subsidiaries.
"Sum of the Pre-DBO Base Factor Products" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof.
"Sum of the Fifth Base Factor Products" shall have the meaning given such
term in Subdivision (II)(c) of Section 4 hereof
"Sum of the Post-DBO Base Factor Products" shall have the meaning given
such term in Subdivision (II) of Section 4 hereof.
"Supplemental Treatment" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Supplemental Treatment Disposal Cost" shall have the meaning given such
term in paragraph (g) of Section 2 hereof.
"Supplemental Treatment Waste" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"System" shall have the meaning given such term in paragraph (o) in Section
2 hereof.
"System Costs" shall have the meaning given such term in paragraph (o) in
Section 2 hereof.
"System License" shall have the meaning given such term in paragraph (o) of
Section 2 hereof.
"System Operator" shall have the meaning given such term in paragraph (o)
of Section 2 hereof.
"Tank Removal Work" shall have the meaning given such term in paragraph (b)
of Section 2 hereof.
320
"Taxi Dispatcher Period" shall have the meaning given such term in
paragraph (b) of Section 46 hereof.
"Taxiways" shall mean taxiways at the Airport for the purpose of the ground
movement of Aircraft to, from and between the Runways, the Public Ramp and Apron
Area, the Public Aircraft Parking and Storage Area and other portions of the
Airport (not including, however, any taxilanes, the exclusive use of which is
granted to the Lessee or any other Person by lease, permit or otherwise).
"TDS" shall have the meaning given such term in paragraph (a) of Section 39
hereof.
"Temporary Facilities" shall have the meaning given such term in paragraph
(a) of Section 2 hereof.
"Temporary Facilities Cost" shall have the meaning given such term in
paragraph (a) of Section 87 hereof.
"Temporary Facilities Work" shall have the meaning given such term in
paragraph (b) of Section 2 hereof.
"Temporary Facilities Work Completion Date" shall have the meaning given
such term in paragraph (n) of Section 2 hereof.
"Temporary Facility Ground Rental" shall have the meaning given such term
in Subdivision (I) of Section 4 hereof.
"Tentative Final Certificate Date" shall have the meaning given such term
in paragraph (a) of Section 87 hereof.
"Term" shall have the meaning given such term in paragraph (a) of Section 3
hereof.
"Terminal 4", "Terminal 6" and "Terminal 7" shall have the meaning given
such terms in paragraph (a) of Section 2 hereof.
"Terminal 4 Parcel" shall have the meaning given such term in Section 1
hereof.
"Terminal 4 Parcel Tender Date" shall have the meaning given such term in
Section 1 hereof.
"Terminal 4 Notice" shall have the meaning given such term in Section 1
hereof.
"Terminal 4 Surrendered Parcel" shall have the meaning given such term in
of Section 1 hereof.
321
"Terminal 5 AirTrain Connector" shall have the meaning given such term in
paragraph (b) of Section 2 hereof.
"Terminal 5 AirTrain Connector Site" shall have the meaning given such term
in paragraph (a) of Section 2 hereof.
"Terminal 5 AirTrain Connector Work" shall have the meaning given such term
in paragraph (b) of Section 2 hereof.
"Terminal 5 AirTrain Connector Work Item A Costs" shall have the meaning
given such term in paragraph (a) of Section 87 hereof.
"Terminal 5 Letter of Credit" shall have the meaning given such term in
paragraph (c) of Section 92 hereof.
"Terminal 5 MOA Requirements" shall have the meaning given such term in
paragraph (c) Section 2 hereof.
"Terminal 5 Redevelopment Basis of Design" shall have the meaning given
such term in paragraph (a) of Section 2 hereof.
"Terminal 5/6 AirTrain Connector " shall have the meaning given such term
in paragraph (a) of Section 2 hereof.
"Terminal 5/6 AirTrain Station" shall have the meaning given such term in
paragraph (a) of Section 2 hereof.
"Terminal 6 Parcel" shall have the meaning given such term in Section 1
hereof.
"Terminal 6 Parcel Tender Date" shall have the meaning given such term in
Section 1 hereof.
"Terminal 6 Site" shall mean that portion of the CTA that is designated by
the Port Authority from time to time for use as a passenger terminal and which
includes some or all of the premises under that certain agreement of lease
entered into between the Port Authority and the Lessee as of the 1st day of
November, 2002 and bearing Port Authority lease number AYD-265 together with
such additional areas as the Port Authority shall determine shall be a part of
the Terminal 6 Site.
"Terminal Work" shall have the meaning given such term in paragraph (n) of
Section 2 hereof.
"Terminal Work Completion Date" shall have the meaning given such term in
paragraph (n) of Section 2 hereof.
322
"Third Additional Rental" shall have the meaning given such term in
Subdivision I of Section 4 hereof.
"Third Additional Rental Commencement Date" shall have the meaning given
such term in paragraph (II)(c) of Section 4 hereof.
"Third Ground Rental" shall have the meaning given such term in Subdivision
(I) of Section 4 hereof.
"Third Variable Per Enplanement Rental Rate" shall have the meaning given
such term in paragraph (I) of Section 4 hereof.
"Total Fifth Amount" shall have the meaning given such term in paragraph
(II)(c) of Section 4 hereof.
"Total Fifth Project Contingency Payment" shall have the meaning given such
term in paragraph (II) of Section 4 hereof.
"Total Post-DBO Amount" shall have the meaning given such term in paragraph
(II)(c) of Section 4 hereof.
"Total Post-DBO Project Contingency Payment" shall have the meaning given
such term in paragraph (II)(c) Section 4 hereof.
"Total Pre-DBO Amount" shall have the meaning given such term in paragraph
(II)(c) of Section 4 hereof.
"Total Pre-DBO Project Contingency Payment" shall have the meaning given
such term in paragraph (II) Section 4 hereof.
"Total Revenue Seats" shall have the meaning given such term in Section 43
hereof.
"Traffic Systems" shall have the meaning given such term in paragraph (d)
Section 10 hereof.
"Travel Costs" shall have the meaning given such term in paragraph (e) of
Section 65 hereof.
"Triggering Event" and "Triggering Events" shall have the meaning given
such terms in Exhibit 49.1 hereof.
"Unknown Environmental Condition" shall have the meaning given such term in
paragraph (g) of Section 2 hereof.
"Users" shall have the meaning given such term in paragraph (o) of Section
2 hereof.
323
"Utility Servicing" shall have the meaning given such term in paragraph (b)
of Section 17 hereof entitled "Rights of Entry Reserved".
"Variable Enplanement Rental" shall have the meaning given such term in
Subdivision (I) of Section 4 hereof.
"Voting Security" or "Voting Securities" shall have the meaning given such
terms in Section 50 hereof.
"Warranty" shall have the meaning given such term in paragraph (o) of
Section 2 hereof.
"Women-owned Business Enterprise" or "WBE" shall have the meaning given
such terms in Schedule E.
"Zone" shall have the meaning given such term in Section 56 hereof.
SECTION 95. ENTIRE AGREEMENT
This Agreement consists of the following: Sections 1 through 95
inclusive , the Exhibits listed on the Table on Contents to this Agreement,
Schedule E and Schedule F attached hereto. It constitutes the entire agreement
of the parties on the subject matter hereof and may not be changed, modified,
discharged or extended except by written instrument duly executed by the Port
Authority and the Lessee. The Lessee agrees that no representations or
warranties shall be binding upon the Port Authority unless expressed in writing
in this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused these presents to
be executed as of the Effective Date.
ATTEST: THE PORT AUTHORITY OF NEW YORK
AND NEW JERSEY
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------- -------------------------------------
Assistant Secretary
(Title) Director of Aviation
--------------------------------
(Seal)
ATTEST: JETBLUE AIRWAYS CORPORATION
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------- -------------------------------------
Secretary
(Title) Vice President CRE
-------------------------------
324
Final Dated November 22, 2005
FOR THE PORT AUTHORITY
STATE OF NEW YORK. )
) ss
COUNTY OF NEW YORK )
On the 22nd day of November in the year 2005, before me, the
undersigned, a Notary Public in and for said state, personally appeared
__________ ▇▇▇▇▇▇ ▇▇▇▇▇ ___________, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual whose name is subscribed
to the within instrument and acknowledged to me that he/she executed the same in
his/her capacity, and that by his/her signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed
the instrument.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-------------------------------------
(Notarial seal and stamp)
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
NOTARY PUBLIC, STATE OF NEW YORK
NO. 02ST6086913
QUALIFIED IN SUFFOLK COUNTY
COMMISSION EXPIRES ON FEB. 3, 2007
FOR THE LESSEE
STATE OF NEW YORK. )
) ss
COUNTY OF NEW YORK )
On the 22nd day of November in the year 2005, before me, the
undersigned, a Notary Public in and for said state, personally appeared
_________ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ___________, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual whose name is subscribed
to the within instrument and acknowledged to me that he/she executed the same in
his/her capacity, and that by his/her signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed
the instrument.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-------------------------------------
(notarial seal and stamp)
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
NOTARY PUBLIC, STATE OF NEW YORK
NO. 02ST6086913
QUALIFIED IN SUFFOLK COUNTY
COMMISSION EXPIRES ON FEB. 3, 2007
"Initial Minimum Enplanement Rental"
Exhibit 4.1
Annual Periods Initial Minimum Enplanement Rental
-------------- ----------------------------------
First $28,500,000
Second 33,000,000
Third 38,000,000
Fourth 39,000,000
Fifth 40,000,000
Sixth 40,000,000
Seventh 40,000,000
Eighth 40,000,000
Ninth 40,000,000
Tenth 40,000,000
Eleventh 40,000,000
Twelfth 40,000,000
Thirteenth 40,000,000
Fourteenth 40,000,000
Fifteenth 40,000,000
Sixteenth 40,000,000
Seventeenth 40,000,000
Eighteenth 40,362,033
Nineteenth 41,169,273
Twentieth 41,992,659
Twenty-first 42,832,162
Twenty-second 43,689,162
Twenty-third 44,562,946
Twenty-fourth 45,454,205
Twenty-fifth 46,363,289
Twenty-sixth 47,290,554
Twenty-seventh 48,236,365
Twenty-eighth 49,201,093
Twenty-ninth 50,185,115
Thirtieth 51,188,817
Thirty-first 52,212,593
Thirty-second 53,256,845
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
For the Port Authority
Initialed:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------
For the Lessee
"Per Enplanement Rental Rate"
Exhibit 4.2
Annual Periods Per Enplanement Rental Rate
-------------- ---------------------------
First $3.45
Second 3.54
Third 3.62
Fourth 3.72
Fifth 3.81
Sixth 3.90
Seventh 4.00
Eighth 4.10
Ninth 4.20
Tenth 4.31
Eleventh 4.42
Twelfth 4.53
Thirteenth 4.64
Fourteenth 4.76
Fifteenth 4.87
Sixteenth 4.97
Seventeenth 5.07
Eighteenth 5.17
Nineteenth 5.28
Twentieth 5.38
Twenty-first 5.49
Twenty-second 5.60
Twenty-third 5.71
Twenty-fourth 5.83
Twenty-fifth 5.94
Twenty-sixth 6.06
Twenty-seventh 6.18
Twenty-eighth 6.31
Twenty-ninth 6.43
Thirtieth 6.56
Thirty-first 6.69
Thirty-second 6.82
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
For the Port Authority
Initialed:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------
For the Lessee
Final November 22, 2005
EXHIBIT 49.1
TRIGGERING EVENTS
The following are the Triggering Events applicable to the provisions
of Sections 49 and 50 of the Lease to which this Exhibit 49.1 is attached
between the Lessee and the Port Authority:
I. Exhibit 49.1 Definitions:
(1) All accounting terms used in this Exhibit and not otherwise
defined herein or in the Lease to which this Exhibit 49.1 is attached shall have
the meanings usually given such terms, in accordance with United States
generally accepted accounting principles.
(2) As used herein the term "CPI Change" shall mean the annual
percentage change, if any, in the CPI yielded by dividing the difference
obtained by subtracting CPI for one Reference Month from the CPI for the
immediately preceding Reference Month, by the CPI for the earlier of the two
Reference Months; as determined by the Port Authority.
(2) As used herein the terms "Debt", "Indebtedness" and "Debt
Financings" shall mean for the purposes of this Exhibit, at any date (i) all
obligations of the Lessee evidenced by loan agreement(s), bonds, debentures,
notes or other similar instruments or for borrowed money; (ii) all equipment
trust certificates, equipment trust indentures, mortgages, conditional sales or
other security agreements, or other similar agreements, and (iii) all capital
lease obligations of the Lessee.
(3) As used herein the term "Specified Amount" shall mean the amount
of Thirty-two Million Dollars and No Cents ($32,000,000.00), as the same shall
be adjusted on an annual basis as follows:
(i) The Port Authority shall ascertain the CPI for the first
Reference Month and for each succeeding Reference Month after the same has been
published, and the Port Authority shall also determine each CPI Change.
(ii) (aa) Effective on January 1, 2006 the Specified Amount
Thirty-two Million Dollars and No Cents ($32,000,000.00) shall be adjusted
by multiplying the amount of $32,000,000.00 by a percentage equal to the
sum of the CPI Change, either positive or negative, as calculated using the
two immediately preceding Reference Months (i.e. October 2004 and October
2005) and 100% and the amount so obtained from the foregoing calculation
shall be and become the Specified Amount in effect for the Adjustment
Period commencing on January 1, 2006.
(bb) Effective on January 1, 2007 and on the first day of
each Adjustment Period thereafter occurring during the Term, the Specified
Amount shall be further adjusted for each Adjustment Period as follows: the
amount of the Specified Amount set forth in paragraph (3)(ii)(aa) above as
the same shall have been last adjusted
Page 1 of Exhibit 49.1
Final November 22, 2005
under this paragraph (3), by multiplying such Specified Amount by a
percentage equal to the sum of the CPI Change as calculated using the two
Reference Months immediately preceding the first day of the subject
Adjustment Period and 100%, and the amount so obtained from the foregoing
calculation shall be and become the Specified Amount in effect for the
Adjustment Period.
II. Triggering Events:
(1) A Triggering Event shall occur when the Lessee shall fail to make
payment as provided for in two or more of the categories listed below.
Furthermore, such Triggering Event shall not have occurred unless the Port
Authority shall have notified the Lessee that such Triggering Event shall be
effective on a date thirty (30) days following the date of such notice unless
all payments due from the Lessee pursuant to such categories listed below and
specified in such notice have been received by the Port Authority:
(i) Payment of monthly installments of rental shall be made to
the Port Authority on the first day of each calendar month;
(ii) Payment of all sums, including, without limitation, flight
fees and fuel gallonage fees under the Lessee's General Airport Agreement or
under the Lessee's JFK Flight Fees Agreement (with respect to flight fees), or
otherwise, shall be made to the Port Authority on or before the date required
for payment in such agreements;
(iii) Payment of all sums due to the Port Authority under this
Agreement or otherwise, and outstanding for more than thirty (30) days,
appearing on a Statement of Account rendered by the Port Authority to the
Lessee.
No provision of this paragraph (1) shall be deemed to affect or limit
the right of the Port Authority to terminate the Lease pursuant to Section 20
(a) (9) thereof for failure to make such payments when due under the Lease.
(2) The Lessee expressly represents and warrants to the Port Authority
that, as of the "Lease Commencement Date" as defined in the Lease, the Lessee
has multiple publicly or non-publicly held Debt Financings each in excess of
Thirty-two Million Dollars and No Cents ($32,000,000.00) which include events of
default which could lead to acceleration thereof.
(3) A Triggering Event shall occur if any of the following shall occur
and the Port Authority shall have previously given or shall thereafter during
the pendency thereof give the Lessee notice of the election of the Port
Authority to activate such Triggering Event:
(a) as a result of a default by the Lessee, other than a default
arising due to compliance by the Lessee with any applicable law or directive or
(provided that the Lessee has satisfied the Port Authority that it is reasonable
to comply therewith) with any requirement, whether having the force of law or
not, of any government or regulatory authority to which the Lessee is subject,
unless such default results in the Lessee becoming bound to repay
Page 2 of Exhibit 49.1
Final November 22, 2005
prematurely any of its Indebtedness for borrowed moneys as described in (i)
below (not being that in respect of which the default has occurred) and steps
are taken to obtain repayment thereof:
(i) the Lessee becomes bound to repay prematurely any of its
Indebtedness for borrowed moneys having an outstanding aggregate principal
amount of at least the Specified Amount or its equivalent in any other currency
or currencies and steps are taken to obtain repayment thereof; or
(ii) any such Indebtedness having an outstanding aggregate
principal amount of at least the Specified Amount or any guarantee or indemnity
of the Lessee of any Indebtedness of any Person for borrowed moneys having an
outstanding aggregate principal amount of at least the Specified Amount is not,
when due, paid by the latest of its due date, the expiry of any applicable grace
period and (if payment is prevented by any applicable law) fifteen (15) days
after the first date on which payment is permitted,
provided that any such acceleration of maturity, default or failure to pay in
subdivision II (3)(a)(i) and/or II (3)(a)(ii) above, as the case may be, shall
not constitute a Triggering Event so long as the Lessee satisfies the Port
Authority that it is being contested in good faith by the Lessee or as long as
the Lessee demonstrates to the Port Authority that such event of default and
acceleration of Debt has arisen from events other than those which would signify
a deterioration in the Lessee's financial position or an inability to meet its
financial obligations under such Debt; or
(b) a creditor takes possession or an administrative or other
receiver is appointed of the whole or a substantial part of the assets of the
Lessee and such taking of possession or appointment is not released, discharged
or canceled within 60 days; or
(c) a distress, execution or seizure before judgment is levied or
enforced upon or sued out against a substantial part of the assets of the Lessee
and is not discharged, dismissed or stayed within 60 days thereof; or
(d) the Lessee stops payment generally or is unable to pay its
Debts generally as and when they fall due or (otherwise than for the purposes of
a solvent reconstruction, amalgamation or merger the terms of which have
previously been approved in writing by the Port Authority) or ceases or
threatens to cease to carry on all or substantially all of its business; or
(e) the Lessee makes an assignment for the benefit or creditors
generally or admits in writing its inability to pay its Debts generally as they
become due or takes corporate action in furtherance of any such action.
III. Modification Requested by ▇▇▇▇▇▇:
The Lessee may deliver a notice to the Port Authority requesting that
one or more of the Triggering Events contained in this Exhibit 49.1 be modified.
The Lessee shall include as part of such notice the text of the modification. If
the Executive Director of the Port Authority, with the approval of the Chairman
of the Committee on Finance of the Board of the Commissioners of the Port
Authority, shall countersign such modification, or an amended version of the
modification that is acceptable to the Lessee, such notice, duly signed by both
the
Page 3 of Exhibit 49.1
Final November 22, 2005
Lessee and the Executive Director of the Port Authority, shall be a valid and
binding modification of the Triggering Events.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
For the Port Authority
Initialed:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------
For the Lessee
Page 4 of Exhibit 49.1
Final Dated November 17, 2005
EXHIBIT 56.1
INITIAL POST CONSTRUCTION BASELINE INVESTIGATION
In addition to the requirements for the Initial Post Construction Baseline
and the Initial Post Construction Baseline Work set forth in Section 56 of the
Lease to which this Exhibit is attached, the following additional steps for
conducting the Initial Post Construction Baseline Work and delivering and
preparing the Initial Post Construction Baseline are to be followed:
1. All terms used in this Exhibit and not otherwise defined herein shall
have the meanings given such terms in the Lease to which this Exhibit is
attached.
2. Sampling shall be performed at each of the locations identified in
Exhibit 56.3 and in addition sampling shall be performed at the approximate
center of each Unknown Environmental Condition that is surveyed and recorded by
the Lessee in accordance with Section 2(g)(12)(iii), provided, however, if any
of the foregoing sampling locations contains any Lessee Hazardous Substance or
any Hazardous Substance that was added to or under the Premises on or after the
Effective Date and were not caused by the sole acts or omissions of the Port
Authority, then no sampling from that location shall be taken or performed and
that sampling location shall not be replaced with another sampling location.
3. The Lessee shall prepare a sampling plan for review and approval by the
Port Authority in accordance with Sections 33 and 56 of the Lease. The sampling
plan shall conform to the NYSDEC's "Sampling Guidelines and Protocols" (▇▇▇▇▇
▇▇, 1990) and shall conform to all the requirements of this Exhibit 56.1,
Exhibit 56.2 and Exhibit 56.3 and Sections 33 and 56 of the Lease.
4. Upon the Port Authority's approval of the Lessee's sampling plan, the
Lessee shall promptly proceed with the Initial Post Construction Baseline Work.
5. Boreholes at each sampling location shall be advanced to the top of the
organic layer and all borings shall be converted into monitoring ▇▇▇▇▇. All
sampling locations shall be surveyed. All soil excavated during installation
shall be examined visually and screened with a properly calibrated
Photo-Ionization Detector (PID) at every two feet of depth. A minimum of two
soil samples shall be collected at each location: one soil sample shall be
collected between one to two feet below ground level, and one soil sample shall
be collected at the soil/water interface. If soil screening indicates that the
soil at another depth other than the two above samples has the highest PID
reading, then one additional soil sample shall be collected from this depth.
6. The Lessee shall install and develop monitoring ▇▇▇▇▇ according to
procedures to be submitted by the Lessee for approval by the Port Authority
covering the installation and development of unconfined, unconsolidated
monitoring ▇▇▇▇▇.
Page 1 of Exhibit 56.1
Final Dated November 17, 2005
7. All ▇▇▇▇▇ shall be constructed of a 2-inch I.D., flush-joint, polyvinyl
chloride (PVC) casing with a 0.020-inch slotted well screen and installed so
that the top of the well screen is set at least two feet above the observed
groundwater table. All ▇▇▇▇▇ shall be finished with a flush-mounted curb box
with an 8-inch diameter steel manhole cover set in concrete. All wellheads shall
be equipped with locking caps.
8. All monitoring ▇▇▇▇▇ shall be developed for two weeks before collecting
groundwater samples. The monitoring ▇▇▇▇▇ shall be gauged before the collection
of groundwater samples.
9. All soil and groundwater samples collected shall be analyzed for the
following parameters: the Priority Pollutant list of 126 compounds and elements
developed by the Environmental Protection Agency (EPA) pursuant to Section
307(a)(l) of the Clean Water Act and 40 non-targeted organic compounds detected
by gas chromatography/mass spectroscopy (GC/MS) analysis, Total Xylenes, Methyl
Tertiary Butyl Ether (MTBE), Tert-Bytyl Alcohol (TBA), Total Glycol and Total
Petroleum Hydrocarbons (TPHC). All analyses shall be performed by laboratories
certified by the New York State Department of Health (NYSDOH) under the
Environmental Laboratory Accreditation Program (ELAP).
10. All analytical results shall be compiled and the data entered into both
Excel spreadsheets as well as electronic data deliverable format for import into
EquIS database. All test results taken within a Zone shall be grouped into
sub-data sets. The sampling results that fall within the boundaries of a Zone
shall be associated with that Zone.
11. The Lessee shall prepare a draft post construction baseline report
summarizing all test results from the soil and groundwater samples taken as part
of the Initial Post Construction Baseline Work and as set forth in paragraph
(10) of this Exhibit and showing all the calculations to determine for each Zone
the Soil Threshold Level and the Ground Water Threshold Level for each Analyzed
Item in accordance with paragraph (j) of Section 56 of the Lease.
12. Upon the Port Authority's approval of the Lessee's draft
post-construction baseline report, such approved report shall become the
"Initial Post Construction Baseline".
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
For the Port Authority
Initialed:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------
For the Lessee
Page 2 of Exhibit 56.1
Final Dated November 17, 2005
ELECTION PURSUANT TO SECTION 142 (B) OF THE
INTERNAL REVENUE CODE OF 1986)
1. JETBLUE AIRWAYS CORPORATION (hereinafter called the "Lessee") pursuant
to an Agreement of Lease bearing Port Authority Lease No. No. AYD-350
(hereinafter, as the same may be hereafter amended, modified and supplemented,
called the "Lease") dated as of May, 6, 2005 (the "Effective Date"), between the
Lessee and The Port Authority of New York and New Jersey (hereinafter called the
"Port Authority"), has leased a site and the structures, improvements,
additions, buildings and facilities located or to be located thereon at ▇▇▇▇ ▇.
▇▇▇▇▇▇▇ International Airport, all as described in the Lease (hereinafter called
the "Leased Premises") to be used for air passenger terminal purposes
constituting part of a public airport for a term commencing on the Effective
Date.
2. The principal office of the Port Authority is at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and its taxpayer identification number is 13-6400654W.
3. The principal office of the Lessee is at ▇▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and its taxpayer identification number is ▇▇-▇▇▇-▇▇▇▇.
4. Capital expenditures in connection with the Leased Premises have been,
or are expected to be made, in whole or in part by the Port Authority from
"exempt facility bonds" (within the meaning of Section 142(a) of the Internal
Revenue Code of 1986) issued by the Port Authority from time to time (such
capital expenditures being hereinafter called the "Property").
5. The Lessee has not acquired and is not acquiring an ownership interest
in the Leased Premises. The Lessee hereby irrevocably elects not to claim for
purposes of federal, state or local taxation of income any depreciation or
investment credits, with respect to the Property. The Lessee further agrees that
this irrevocable election shall be binding upon its successors in interest, if
any, under the Lease, and as a condition of any permitted sale or assignment of
the interest of the Lessee under the Lease, every successor in interest shall
furnish an executed irrevocable election in the form of the immediately
preceding sentence to the Port Authority. The foregoing shall not grant or be
deemed to grant to the Lessee the right to sell or assign, in any manner, its
interests under the Lease.
6. It is understood that the foregoing election shall not apply to any
capital expenditures made by the Lessee with respect to the Leased Premises or
to any personal property of the Lessee (including equipment and trade fixtures)
removable without material damage to the Leased Premises, installed by the
Lessee in or on the Leased Premises pursuant to the Lease, and which are deemed
to be and remain the property of the Lessee.
ATTEST: JETBLUE AIRWAYS CORPORATION
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------- -------------------------------------
Secretary (Title) Vice President CRE
(Corporate Seal)
----------------------------
APPROVED
----------------------------
FORM TERMS
---- -----
____ _____
THIS AGREEMENT SHALL NOT BE BINDING
UPON THE PORT AUTHORITY UNTIL DULY
EXECUTED BY AN EXECUTIVE OFFICER THEREOF
AND DELIVERED TO THE OBLIGOR BY AN
AUTHORIZED REPRESENTATIVE OF THE PORT AUTHORITY
Agreement No. AX-782
AGREEMENT
THIS AGREEMENT (hereinafter referred to as the "Agreement") made as of
the 17th day of November, 2005 (hereinafter referred to as the "Effective
Date"), by and between THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY
(hereinafter referred to as the "Port Authority"), and JETBLUE AIRWAYS
CORPORATION (hereinafter referred to as the "Obligor"), a corporation organized
and existing under the laws of the State of Delaware with an office and place of
business at ▇▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, whose
representative is Vice President of Corporate Real Estate.
WITNESSETH, That:
WHEREAS, the Obligor and the Port Authority are simultaneously
herewith entering into a certain agreement of lease bearing Port Authority
Agreement No. AYD-350 (the "Lease") dated as of May 6th and covering certain
redevelopment work and premises at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport, as
more fully described in the Lease;
WHEREAS, the parties hereto in consideration of the execution of the
Lease and in connection therewith desire to provide security for the performance
and fulfillment by the Obligor of its obligations under the Lease; and
NOW, THEREFORE, in consideration of the covenants and mutual
agreements herein contained, the Port Authority and the Obligor hereby agree as
of the Effective Date as follows:
1. (a) Upon the execution of the Lease, the Obligor shall deliver to
the Port Authority as security for the full, faithful and prompt performance of
and compliance with, on the part of the Obligor of all of the provisions, terms
and conditions of the Lease on its part to be fulfilled, kept, performed or
observed, including without limitation, the payment of all rentals, fees and
other amounts, charges and obligations now or in the future to become due and
owing to the Port Authority by the Obligor pursuant to the Lease (the
"Obligations"), a clean irrevocable letter of credit in the amount of Eighty
Million Dollars and No Cents ($80,000,000.00) (the "Security Amount") payable in
the Port of New York District and issued to and in favor of the Port Authority
by a banking institution acceptable to the Port Authority and having its main
office or a corresponding branch within the Port of New York District. Each
letter of credit
Final Dated November 17, 2005
delivered by the Obligor to the Port Authority pursuant to and in accordance
with this Agreement is herein called a "Letter of Credit". The form and terms of
each Letter of Credit, as well as the institution issuing it, shall be subject
to the prior and continuing approval of the Port Authority. Each Letter of
Credit shall provide that it shall be effective for the period (the "Effective
Period") commencing on the Effective Date and ending on the date that the
Obligor shall deliver to the Port Authority in accordance with the Lease the
Terminal 5 Letter of Credit as defined in therein; such continuance may be by
provision for automatic renewal or by delivery to the Port Authority of a
substitute letter of credit satisfactory to the Port Authority and meeting all
the requirements set forth in this paragraph 1(a) in an amount so that at all
times during the Effective Period the Port Authority shall have a Letter of
Credit or Letters of Credit in the Security Amount. If requested by the Port
Authority, any Letter of Credit delivered pursuant to this Agreement shall be
accompanied by a letter expressing the opinion of counsel for the banking
institution issuing the Letter of Credit that the issuance of said Letter of
Credit is an appropriate and valid exercise by the banking institution of the
corporate power conferred upon it by law.
(b) Upon notice of cancellation of a Letter of Credit or upon
notice that a Letter of Credit will not be extended the Obligor agrees that
unless, by a date sixty (60) days prior to the effective date of such
cancellation or expiration, such Letter of Credit is replaced by another letter
of credit satisfactory to the Port Authority and meeting all the requirements of
paragraph 1(a) above in an amount so that at all times during the Effective
Period the Port Authority shall have a Letter of Credit or Letters of Credit
under this Agreement in the Security Amount, the Port Authority may draw down
the full amount thereof and thereafter the Port Authority will hold the same as
security under this Agreement.
(c) (i) An event of default hereunder ("Event of Default") shall
exist upon the occurrence and during the continuance of any of the following:
(aa) Any one or more of the events described in
subparagraphs (a) (1), (a) (2) or (a) (3) of Section 20 of the Lease shall
have occurred and be continuing;
(bb) The Lease shall have been terminated by the Port
Authority; or
(cc) The Lease shall have been terminated by JetBlue.
(ii) Upon and at any time after an Event of Default shall
have occurred and be continuing, and in addition to any and all other remedies
available to it, the Port Authority shall have the right, at its option at any
time and from time to time, with or without notice, to draw upon the Letter of
Credit or Letters of Credit, in whole or in part, in whole or partial
satisfaction of any of its claims and demands against the Lessee. There shall be
no obligation on the Port Authority to exercise such right and neither the
existence of such right nor the holding of a Letter of Credit or Letters of
Credit shall cure any default or breach of the Lease.
(d) If at any time any bank shall fail to make any payment to the
Port Authority in accordance with any Letter of Credit issued by any such bank,
the Obligor shall cause to be delivered to the Port Authority on demand another
letter of credit satisfactory to the Port Authority and meeting all the
requirements set forth in paragraph 1 (a) above in an amount
2
Final Dated November 17, 2005
so that at all times during the Effective Period the Port Authority shall have a
Letter of Credit or Letters of Credit in the Security Amount.
(e) No action by the Port Authority pursuant to the terms of any
Letter of Credit, or receipt by the Port Authority of funds from any bank
issuing any Letter of Credit, shall be or be deemed to be a waiver of any breach
or default by the Obligor of the Obligations and all rights and remedies under
the Lease, or otherwise consequent upon such breach or default shall not be
affected by the existence of or recourse to any such Letter of Credit.
(f) Upon written request therefor by the Obligor on or after the
Obligor shall have delivered to the Port Authority the Terminal 5 Letter of
Credit (as defined in the Lease) and upon the condition that an Event of Default
shall not have occurred and be continuing, the Port Authority will return to the
Obligor the Letter of Credit or Letters of Credit which have been caused to be
delivered to the Port Authority by the Obligor hereunder and are in the
possession of the Port Authority less the amount by partial or full drawings of
any and all unpaid claims and demands (including estimated damages) of the Port
Authority by reason of any default or breach by the Obligor of the Obligations.
2. No failure by the Port Authority to insist upon the strict
performance of this Agreement or any agreement, term, covenant, requirement or
condition of the Lease or to exercise any right or remedy consequent upon a
breach or default of any of the foregoing, and no extension, supplement or
amendment of any of the Lease during or after a breach thereof, unless expressly
stated to be a waiver, and no acceptance by the Port Authority of rentals, fees,
charges or other payments in whole or in part after or during the continuance of
any such breach or default, shall constitute a waiver of any such breach or
default of any of the terms or conditions of the Lease or this Agreement. No
agreement, term, covenant, requirement, obligation or condition of the Lease or
this Agreement to be performed or complied with by the Obligor and no breach or
default thereof, shall be waived, altered or modified except by a written
instrument executed by the Port Authority. No waiver by the Port Authority of
any default or breach on the part of the Obligor in performance of any
agreement, term, covenant, requirement, obligation or condition hereof or in the
Lease shall affect or alter any obligation, but each and every agreement, term,
covenant, requirement, obligation and condition hereof and in the Lease shall
continue in full force and effect with respect to any other then existing or
subsequent breach or default thereof.
3. The Obligor hereby agrees that a breach or failure to perform or
comply with any of the terms and conditions of this Agreement, including without
limitation, failure to provide a Letter of Credit or Letters of Credit in
accordance with the terms and provisions of this Agreement at any time during
the Effective Period valid and available to the Port Authority or any failure of
any banking institution issuing a Letter of Credit to make one or more payments
as provided in such Letter of Credit or Letters of Credit, shall constitute a
material breach of the Lease thereby entitling the Port Authority to immediately
exercise any and all rights available to it as fully as if such breach, failure
or non-compliance was a breach of the Lease, including without limitation, the
right to terminate the Lease pursuant to Section 20 thereof.
4. For purposes of the foregoing, the Obligor hereby certifies that
its I.R.S. Employer Identification No. is: ▇▇-▇▇▇-▇▇▇▇.
5. No Commissioner, director, officer, agent or employee of either
party shall be charged personally or held contractually liable by or to the
other party under any term or
3
Final Dated November 17, 2005
provision of this Agreement or of any supplement, modification or amendment to
this Agreement or because of any breach thereof, or because of its or their
execution or attempted execution.
IN WITNESS WHEREOF, the parties have caused these presents to be
executed the day and year first above written.
ATTEST THE PORT AUTHORITY OF NEW YORK AND NEW
JERSEY
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------- -------------------------------------
Assistant Secretary (Title) Director of Aviation
(Seal)
ATTEST JETBLUE AIRWAYS CORPORATION
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------- -------------------------------------
Secretary (Title) Vice President CRE
(Corporate Seal)
----------------------------
APPROVED
----------------------------
FORM TERMS
---- -----
____ _____
4
Final Dated November 17, 2005
FOR THE PORT AUTHORITY
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
On the 22nd day of November in the year 2005, before me, the undersigned, a
Notary Public in and for said state, personally appeared ▇▇▇▇▇▇ ▇▇▇▇▇,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
(notarial seal and stamp)
FOR JETBLUE AIRWAYS CORPORATION
STATE OF NEW YORK ) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
) ss. NOTARY PUBLIC, STATE OF NEW YORK
COUNTY OF NEW YORK ) NO. 02ST6086913
QUALIFIED IN SUFFOLK COUNTY
COMMISSION EXPIRES ON FEBRUARY 3, 2007
On the 22nd day of November in the year 2005, before me, the undersigned, a
Notary Public in and for said state, personally appeared ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
(notarial seal and stamp)
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
NOTARY PUBLIC, STATE OF NEW YORK
NO. 02ST6086913
QUALIFIED IN SUFFOLK COUNTY
COMMISSION EXPIRES ON FEBRUARY 3, 2007
5
EXHIBIT 94.1
"MEMORANDUM OF AGREEMENT"
TO LEASE NO. AYD-350
BETWEEN
THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY
AND
JETBLUE AIRWAYS CORPORATION
/s/: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
FOR THE PORT AUTHORITY
INITIALED:
/s/: ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------
FOR THE LESSEE
TABLE OF CONTENTS
SECTION TITLE NO. OF PAGES
------- ----- ------------
1.0 November 1, 2004 Transmittal Letter 1
2.0 Memorandum of Agreement 20
APPENDIX
APPENDIX DESCRIPTION NO. OF PAGES
-------- ----------- ------------
A Description of Project 1
B Revised Concept Master Plan 1
C Minutes of September 18,2003 Meeting 1
D Redevelopment Advisory Committee Guidelines 2
SECTION 1.0
NOVEMBER 1,2004 TRANSMITTAL LETTER
[GRAPHIC] New York Airports District Office
U. S. Department ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
FEDERAL AVIATION
ADMINISTRATION
November 1,2004
Re: Memorandum of Agreement
Terminal 5 and 6 Redevelopment Project
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport (JFK)
Dear Consulting Party Member:
Thank you for your participation in the 106 process. Enclosed for your records
is a copy of the fully executed Memorandum of Agreement for the JFK Terminal 5
and 6 Redevelopment Project at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport (JFK). We
are very pleased to report that all of the consulting parties elected to concur
on the MOA.
The fully executed MOA is being filed with the ACHP and is the formal conclusion
of the Section 106 process. In accordance with Stipulation 3 of the MOA, the
PANYNJ will be coordinating activities of the Redevelopment Advisory Committee
(RAC). ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Program Director, JFK Redevelopment, will be
contacting you in the near future with information regarding the first meeting
of the RAC.
With regard to the NEPA process, the PANYNJ is currently in the process of
finalizing the EA. The EA will then be submited to FAA for review and an
environmental determination.
Thank you again for your work on this project. We look forward to the successful
implementation of the MOA.
Sincerely,
▇▇▇▇▇ ▇. ▇▇▇▇▇
Environmental Specialist
New York Airports District Office
Enclosure
cc: ▇. ▇▇▇▇▇▇▇, ▇. ▇▇▇▇▇▇▇▇, PA NY&NJ
▇. ▇▇▇▇▇, ▇. ▇▇▇▇, ▇▇▇▇
▇. ▇▇▇▇▇▇, ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇
▇. ▇▇▇▇▇▇▇, CH2MHill
bcc: ▇. ▇▇▇▇▇▇▇▇, AEA-600 ▇. ▇▇▇▇▇, AEA-600 ▇. ▇▇▇▇▇▇, AEA-600
▇. ▇▇▇▇▇▇, AEA-7 ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, read file
NYADO, day file Project file
SECTION 2.0
MEMORANDUM OF AGREEMENT
MEMORANDUM OF AGREEMENT
AMONG
THE PORT AUTHORITY OF NEW YORK & NEW JERSEY,
THE NEW YORK STATE HISTORIC PRESERVATION OFFICE,
THE FEDERAL AVIATION ADMINISTRATION, AND
THE ADVISORY COUNCIL ON HISTORIC PRESERVATION
FOR THE REHABILITATION, RESTORATION, AND
ADAPTIVE REUSE OF TWA TERMINAL 5 AT
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ INTERNATIONAL AIRPORT
JAMAICA, NEW YORK
WHEREAS, the proposed redevelopment of the TWA Terminal site at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
International Airport (JFK), as part of the proposed Terminal 5/6 Redevelopment
Project, has prompted the Port Authority of New York & New Jersey (Port
Authority), as operator of JFK, to request the Federal Aviation Administration
(FAA) to consider approving a change to the airport layout plan (ALP); and
WHEREAS, the TWA Terminal site includes the existing TWA Main Terminal Building,
the Connecting Flight Tube to the present Flight Wing 1 ("West Tube"), the
Connecting Flight Tube to the present Flight Wing 2 ("East Tube"), and "Flight
Wings 1 and 2," and
WHEREAS, the existing TWA Main Terminal Building, the East and West Tubes, and
Flight Wing 2 have been determined to be eligible for listing on the National
and State Registers of Historic Places and
WHEREAS, the existing TWA Terminal was designed in the late 1950's and opened in
1962, and has been determined through an exploration of feasible and prudent
alternatives to be inadequate in function and scale for contemporary airport
terminal use at JFK; and
WHEREAS, the FAA notified the Advisory Council on Historic Preservation (ACHP)
that the proposed redevelopment will have an Adverse Effect on the National and
State Register-eligible TWA Terminal, and
WHEREAS, the FAA, the New York State Historic Preservation Office (SHPO), the
Advisory Council on Historic Preservation (ACHP) and the Port Authority, as an
invited signatory, have consulted pursuant to 36 C.F.R. Part 800, regulations
implementing Section 106 of the National Historic Preservation Act, as amended
(16 U.S.C. 470f); and
WHEREAS, The National Trust for Historic Preservation, The Municipal Art Society
of New York, the New York City Partnership, Documentation and Conservation of
Buildings, Sites and Neighborhoods of the Modern Movement (DOCOMOMO), the
Finnish Consulate General, New York Landmarks Conservancy, Jet Blue Airways, the
New York Building Congress, and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & Associates -- as interested
parties, have requested and been invited by the FAA to be consulting parties and
to participate in the Section 106 process as described at 36 C.F.R. Part 800,
and have been invited to concur in this Memorandum of Agreement (MOA), and
WHEREAS, a new terminal will be constructed and the historic TWA Terminal and
the East Tube will be restored/rehabilitated and adaptively reused as these
projects are reflected herein and described in the "Revised Concept Master Plan"
- consisting of the initial Concept Master Plan of July, 2000, as amended as of
February 2001, as described in the October 29, 2001 PowerPoint Presentation "JFK
Sites 5/6 Redevelopment Including the TWA Landmark" by ▇▇▇▇▇▇ ▇. Davidson, FAIA,
and as revised on October 10, 2003, as a result of additional consultation with
the consulting parties. (See Attachment A -- description of project, Attachment
B -- drawing of Revised Concept Master Plan, and Attachment C - October 10, 2003
Report to FAA on Consultation).
NOW THEREFORE, the FAA, the SHPO, the ACHP, and the Port Authority agree that
the project to redevelop the Terminals 5/6 site at JFK shall be implemented in
accordance with the following Stipulations in order to take into account the
effect of the undertaking on the TWA Terminal site:
STIPULATIONS
If the FAA approves the undertaking, it will ensure that the following measures
are carried out:
PLANNING
1. In December 2001 and January 2002, the Port Authority advertised in 19 local,
national, and international publications a Solicitation of Interest (SOI) to
identify entities with an interest in undertaking the restoration/rehabilitation
and adaptive reuse of the TWA Terminal. As a result, the Port Authority sent a
SOI package to 104 entities that responded to the advertisement. In addition, a
SOI package was provided to each of the signatories to this MOA and the
consulting parties. The Port Authority received 41 expressions of interest, and
those entities, and any other interested party, will receive a RFP for the
restoration/rehabilitation and adaptive reuse of the TWA Terminal. The Port
Authority will seek, through a Request For Proposals (RFP) process, to execute
an agreement with an adaptive reuse developer providing for the appropriate
design, construction, restoration, rehabilitation, operation and maintenance of
the TWA Main Terminal Building and the Connecting Flight Tubes. The Port
Authority will use its best efforts to issue the RFP as soon as possible
following receipt of FAA approval for the Terminal 5/6 Redevelopment Project and
expects to request that proposals be submitted to it no later than four months
after issuance. The Port Authority will require that any adaptive reuse
developer selected as a result of the RFP or any other process, must agree to
adhere to the terms and conditions in this Memorandum of Agreement. The Port
Authority shall give each consulting party the opportunity to comment on the
Draft RFP documents prior to issuance in order to receive their input on design
and preservation issues in those documents, which are within the scope of this
MOA. The Port Authority shall also give the consulting parties the opportunity
to comment on the proposals received in response to the RFP. The comments of the
consulting parties shall be provided to the Selection Committee for their
consideration during the selection process.
2. In accordance with the Port Authority's October 10, 2003 report to the FAA on
the consultation process, the adaptive reuse will accommodate the provision of,
at minimum, two (2) electronic ticketing kiosks in an appropriate setting within
the TWA Main Terminal for use by airline passengers with carry-on luggage only.
The Port Authority will require that any airline
2
responsible for the ticketing kiosks will install, operate and maintain the
kiosks and monitor their usage.
3. In order to seek input from interested parties, on the implementation of the
Revised Concept Master Plan for the Terminal 5/6 site at JFK, in accordance with
the Stipulations in this MOA, including the restoration, rehabilitation and
reuse of the TWA Terminal Building and efforts to minimize any adverse effects
of the site redevelopment on the TWA Terminal Building, a Redevelopment Advisory
Committee (RAC) will be formed and will operate in accordance with the
Guidelines in Attachment D to this MOA. The RAC will consist of the consulting
parties that express an interest in participating, the SHPO and Port Authority.
4. In order to avoid, minimize or mitigate any adverse effect of the new
terminal in each development phase on the historic building, the siting and
design of a new terminal on the airside of the historic building shall provide
an appropriate setting for the TWA Terminal Building. The goal will be to retain
the individual identity of the historic building, separate from the new
terminal. The new terminal will include improved public access to the TWA Main
Terminal through the Connecting Flight Tubes, and will be separated from the TWA
Main Terminal by an outdoor plaza and arrivals roadway. As reflected in the Port
Authority's October 10, 2003 report to the FAA on the consultation process, and
as reflected in the Revised Concept Master Plan, the Port Authority will enhance
public access to the TWA Main Terminal by providing enclosed connectors from the
light rail station (AirTrain JFK) to the TWA Main Terminal. The connection will
contain signage to allow for passage of air terminal passengers, patrons of the
adaptive reuse, and the general public to the TWA Main Terminal and its
features. In compliance with the July 18, 1997 record of decision on the
Environmental Impact Statement for the JFK Light Rail System, this connection
shall be constructed in such a way as to minimize physical and visual impacts to
the historic resource. Additionally, as more detailed plans for the siting and
design of the new terminal are developed, including the connections from the TWA
Main Terminal to Air Train JFK and to the new terminal, those plans will be
forwarded to the SHPO, and in accordance with RAC Guidelines, to the RAC for
review and comment. The roadway system will also allow vehicles to access either
the TWA Main Terminal frontage or the arrivals/departures roadways of the new
terminal.
5. The final design plans for the restoration, rehabilitation and adaptive reuse
of the TWA Main Terminal and the East Tube, and any plans for alteration of the
West Tube shall be submitted by the Port Authority to the SHPO for comment as to
whether those plans conform to the conditions set forth in Stipulation 12
governing the standards for performance of the restoration and rehabilitation
work. Subsequently, the SHPO and the Port Authority shall give the consulting
parties, and the RAC, in accordance with the RAC Guidelines, an opportunity to
provide comment on those plans, including comment on whether those plans conform
to the standards set forth in Stipulation 12. All such comments shall be
considered by the Port Authority and the SHPO and the SHPO shall consult with
the Port Authority before the Port Authority approves the final TWA Terminal and
Connecting Flight Tubes design plans. The Port Authority shall notify all
signatories, all consulting parties and all members of RAC of its approval of
the final TWA Terminal and Connecting Flight Tubes design plans.
3
6. As part of its public education effort, the Port Authority shall develop an
interpretative display illustrating the history and significance of the TWA
Terminal site and its relationship to the overall development of JFK
International Airport. The exhibit shall be placed in a prominent location in
the TWA Main Terminal Building or in another appropriate setting proximal to
that building. The display shall be accessible to the public during normal
operating hours after the rehabilitation/restoration is complete.
7. The Port Authority shall have a consultant that meets the professional
qualifications established by the U.S. Department of the Interior and set forth
in 62 Fed. Reg. 33,707 (June 20, 1997) prepare a National Register of Historic
Places nomination for the TWA Main Terminal Building, the Connector Tubes and
the Flight Wings prior to demolition of the Flight Wings and shall support such
listing on the Register.
8. The Port Authority shall record the TWA Main Terminal Building, Flight Wing
2, and the Connecting Flight Tubes to Level 1 Historical Architectural Building
Survey/Historic American Engineering Record (HABS/HAER) standards of the
National Park Service. The consultant chosen by the Port Authority to conduct
the documentation shall meet the professional qualifications established by the
U.S. Department of the Interior and set forth in 36 C.F.R. 61. Copies of the
recordation shall be sent to the National Park Service - HABS/HAER Coordinator,
the New York State Archives, the Port Authority and the SHPO.
9. As reflected in the Port Authority's October 10, 2003 report to the FAA on
the consulting process, the preservation of the East Tube may require structural
modifications to the column(s) in order to allow roadways to pass under the
existing tube.
10. The Port Authority will not begin to remove the Flight Wings as set forth in
Stipulation 14 until a development plan for a new terminal is in place and a
lease agreement is reached between the Port Authority and a tenant(s) for the
new terminal.
INTERIM MAINTENANCE
11. The Port Authority shall ensure and commit adequate resources so that the
TWA Main Terminal Building, including portions not eligible for listing as
historic landmarks, and the Connecting Flight Tubes are properly maintained and
cared for from the present until an ongoing maintenance obligation for the TWA
Main Terminal and Connecting Flight Tubes is undertaken by the adaptive reuse
developer consistent with Stipulations 12 and 13. Such interim maintenance shall
include, but not be limited to, regularly scheduled inspections of the building
(including the roof), cleaning, preventive maintenance routines for HVAC
equipment, temperature control, plumbing, and fire systems, and shall be
supervised by the Port Authority. Necessary repairs/maintenance identified
through the regularly scheduled inspections will be done by the Port Authority
in a timely manner. During this interim period, the SHPO shall be given the
opportunity by the Port Authority to inspect the building to ensure that it is
being properly maintained. The Port Authority shall ensure the maintenance
efforts described above are continually undertaken in the event that the
adaptive reuse is interrupted or temporarily discontinued at any time.
4
RESTORATION AND REHABILITATION
12. As a condition of reuse, the Port Authority, through consultation with the
SHPO, shall assure that the TWA Main Terminal Building and East Tube are
restored and rehabilitated by the adaptive reuse developer in accordance with
the Secretary of Interior Standards for the Treatment of Historic Properties
("Secretary's Standards"). The TWA Main Terminal and the East Tube shall, as a
whole, be treated in accordance with the Standards for the Treatment of Historic
Properties - Rehabilitation. As per Stipulation 9, structural modifications may
be required to the column(s) of the East Tube. The existing facade, including
the landside entrances and window walls, the airside window walls, the concrete
roof shell, the lower and upper main lobby spaces, the interior of the East
Flight Tube and the Ambassador Club on the north mezzanine in the Main Terminal
interior shall be restored in accordance with the Standards for the Treatment of
Historic Properties - Restoration.
13. The plan to be approved by the Port Authority for the restoration,
rehabilitation and adaptive reuse of the TWA Main Terminal Building by an
adaptive reuse developer will retain the entire visible exterior length of the
existing East Tube. As reflected in the Port Authority's October 10, 2003 report
to the FAA on the consultation process, the West Tube may be modified. For this
connector tube, a hierarchy of options will be investigated, in consultation
with RAC, as part of the design for the new terminal. The first option would
seek to adapt the existing configuration in a minimally intrusive manner to
improve public access. If analysis finds this option to be infeasible, then a
design for reconstructing the connecting walkway to incorporate a moving walkway
system in a manner consistent with the original design will be undertaken.
Should such an effort prove to be inconsistent with the objective of improving
public access, after consultation with the RAC, in accordance with RAC
Guidelines, the Port Authority shall assure that a contemporary and appropriate
design will be constructed to replace the West Tube. Both tubes will provide
public access between the rehabilitated/restored TWA Terminal and the newly
constructed terminal building.
14. As reflected in the Port Authority's October 10, 2003 report to the FAA on
the consultation process, both Flight Wing 1 and Flight Wing 2 will be
demolished. Prior to the demolition, reuse of two of the gate lounge "trumpets,"
as well as other architecturally significant elements, will be investigated as
part of the new terminal concourse and/or gate holdroom area. If feasible, the
inclusion of all or part of the "trumpets" and their original interiors would be
relocated and included as part of the new terminal concourse.
15. The restoration work shall include the removal of non-historic additions to
the original TWA Main Terminal Building and Connecting Flight Tubes including,
but not limited to, entrance vestibules, security booths, the south baggage
facility and the pedestrian canopy. The work on the interior lobby spaces shall
include the restoration of the marble tile flooring and wall surfaces, the
information desk, the ▇▇▇▇▇▇ flight information display surround, railings,
stairs and ventilation enclosures. Remaining non-historic kiosks, signage and
furnishings shall be removed. The Port Authority shall continue to consult with
the SHPO on the restoration, rehabilitation and adaptive reuse until the
restoration and rehabilitation work is completed by the adaptive reuse
developer.
5
16. After its completion, the rehabilitation/restoration work performed in
accordance with Stipulation 12 shall be approved for conformance with the
standards set forth in Stipulation 12 by the SHPO. The SHPO, upon being informed
by the Port Authority that the rehabilitation/restoration work has been
completed, shall notify all consulting parties and the RAC that the SHPO's
approval under this Stipulation is being sought. The consulting parties and
members of RAC shall have 60 days from such notification to provide the Port
Authority and the SHPO with their comments as to whether the
rehabilitation/restoration work has been performed in conformance with the
standards set forth in Stipulation 12. In order to facilitate their comment, the
consulting parties and the members of the RAC during this 60-day period shall be
given an opportunity to tour, as a group, the newly renovated and rehabilitated
TWA Main Terminal Building and East Tube. After receiving such comments, the
SHPO, when it is satisfied that the work has been performed in conformance with
the conditions set forth in Stipulation 12, shall approve the
rehabilitation/restoration work. The Port Authority shall notify all
signatories, all consulting parties and the RAC of the SHPO approval.
ONGOING MAINTENANCE AND PRESERVATION
17. The Port Authority shall prepare maintenance and preservation guidelines for
the treatment of the TWA Main Terminal Building and East Tube. The guidelines
shall address the replacement and repair of historic materials, on-going facade
maintenance and cleaning, and the repair of historic and replacement elements
such as light fixtures, hardware and entrances. The guidelines shall prescribe
periodic inspections and maintenance for systems and assemblies on a five-year
cycle. The guidelines shall prescribe that the inspection shall review the
condition of the restored historic fabric including but not limited to the
concrete roof shell, the glass window walls and entrances, the interior finishes
and the railings, stairs and historic furnishings. The guidelines shall be
submitted to SHPO for review and approval following completion of the
rehabilitation/restoration work referenced in Stipulations 12-16.
18. After the restoration and rehabilitation work is completed by the adaptive
reuse developer, the Port Authority shall perform an inspection of the TWA Main
Terminal Building and East Tube every five years in accordance with the
maintenance and preservation guidelines referenced in Stipulation 17 and submit
a certified copy of the report to the SHPO for approval. A copy of the report
approved by the SHPO shall be provided by the Port Authority to the signatories
to the MOA. The inspection shall be conducted by an architect or engineer
experienced in the restoration of historic structures.
TERMINATION OF MEMORANDUM OF AGREEMENT
19. The maintenance and inspection obligations referenced in Stipulations 17 and
18 above shall continue as outlined in those Stipulations. This agreement shall
expire after the co-Chairs of RAC notify all members of RAC and the FAA that the
consultation process for RAC has been completed, and after any objections raised
pursuant to the Dispute Resolution process in Stipulation 21 have been
considered in accordance with that Stipulation. The FAA shall notify all
signatories when this MOA expires.
20. If any signatory determines that the terms of the MOA cannot be or are not
being carried out, then this signatory shall give written notice of such
determination to all other signatories to
6
the MOA. If the MOA is not amended by consultation between the signatories
within three months after issuance of such notice, then any signatory may
terminate the MOA (with the exception of the maintenance and inspection
obligations referenced in Stipulations 17 and 18), by providing thirty (30)
calendar days written notice to the other signatories. The FAA shall then either
execute a new agreement with the signatories pursuant to 36 CFR 800.6 (c)(1), or
request and respond to the comments of the Council under 36 CFR 800.7(a). If the
Port Authority has not executed an agreement with an adaptive reuse developer
for the rehabilitation/restoration work within five (5) years after this
agreement has been executed by the signatories, the Port Authority shall notify
the signatories of this fact, and the signatories shall reconsider the terms of
the agreement, other than the maintenance and inspection obligations referenced
in Stipulation 11, and consult among themselves to amend this agreement pursuant
to this Stipulation.
21. Should any member of the public or other interested party, including the
signatories to this MOA and the members of the RAC, object within the 30 days of
the approval, pursuant to Stipulation 5, of the restoration/rehabilitation plans
or the approval, pursuant to Stipulation 16 of the restoration/rehabilitation
work, or any other action proposed with regard to the restoration/rehabilitation
of the TWA Terminal and East Tube, the Port Authority shall consult with the
objecting party to resolve the objection. If the Port Authority, after
consultation with the SHPO and the objecting party, determines that the
objection cannot be resolved, the Port Authority shall request the further
comments of the Advisory Council for Historic Preservation. Any Council comment
provided in response to such request shall be taken into account by the Port
Authority, in further consultation with the SHPO with reference only to the
subject of dispute; the Port Authority's responsibility to carry out all actions
under this agreement that are not subjects of this dispute shall remain
unchanged.
EXECUTION AND AMENDMENT
Execution of this Memorandum by the FAA, the SHPO, the ACHP, and the Port
Authority, and implementation of its terms, will be evidence that FAA has
afforded consulting parties an opportunity to comment on the undertaking and its
effects on the historic property, and that the FAA has taken into account the
effect of the undertakings on the historic property, and has completed all
processes in accordance with Section 106 of the National Historic Preservation
Act.
Until the Port Authority enters into an agreement with an adaptive reuse
developer for the rehabilitation/restoration work on the TWA Terminal Building,
any signatory to this agreement may propose to the other signatories that this
agreement be amended, whereupon the FAA shall consult with the other signatories
to this MOA in accordance with 36 C.F.R. 800.6(c)(7), (8) to consider such an
amendment.
7
SIGNATORY PAGES* (PAGE 1 OF 4)
THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ DATE: 8/25/04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Print/Type Title: CHIEF OPERATING OFFICER
----------
* A separate signature page is being executed by each signatory to this
Agreement.
8
SIGNATORY PAGES* (PAGE 2 OF 4)
FEDERAL AVIATION ADMINISTRATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ DATE: 9/2/04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Print/Type Title: REGIONAL ADMINISTRATOR EASTERN REGION
FEDERAL AVIATION ADMINISTRATION
----------
* A separate signature page is being executed by each signatory to this
Agreement.
9
SIGNATORY PAGES* (PAGE 3 OF 4)
NEW YORK STATE HISTORIC PRESERVATION OFFICE
By: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Date: 9/22/04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Print/Type Title: SAPO/COMMISSIONER
----------
* A separate signature page is being executed by each signatory to this
Agreement.
10
SIGNATORY PAGES* (PAGE 4 OF 4)
ADVISORY COUNCIL FOR HISTORIC PRESERVATION
BY: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Date: 9/16/04
------------------------------------
Print/Type Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Print/Type Title: EXECUTIVE DIRECTOR
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* A separate signature page is being executed by each signatory to this
Agreement.
11
CONSULTING PARTIES CONCURRENCE -- PAGE 1 OF 3
JETBLUE AIRWAYS CORPORATION
BY: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Date: 10/15/04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇, VP REDEVELOPMENT
THE NATIONAL TRUST FOR HISTORIC PRESERVATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Date: Oct 7, 2004
------------------------------------
Print/Type Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, General Counsel
THE MUNICIPAL ART SOCIETY OF NEW YORK
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Date: 10/4/04
------------------------------------
Print/Type Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
12
CONSULTING PARTIES CONCURRENCE -- PAGE 2 OF 3
THE NEW YORK CITY PARTNERSHIP
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Date: 9-30-2004
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇, President & CEO
DOCUMENTATION AND CONSERVATION OF BUILDINGS, SITES AND NEIGHBORHOODS OF THE
MODERN MOVEMENT (DOCOMOMO)
By: /s/ ▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ Date: 10.21.04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇, Ph.D., FAIA
THE CONSULATE GENERAL OF FINLAND, NEW YORK
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ Date: 4.10.04
------------------------------------
Print/Type Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
CONSUL GENERAL
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CONSULTING PARTIES CONCURRENCE -- PAGE 3 OF 3
NEW YORK LANDMARKS CONSERVANCY
By: /s/ ▇▇▇ ▇▇▇▇▇ Date: 10/04/04
------------------------------------
Print/Type Name: ▇▇▇ ▇▇▇▇▇
THE NEW YORK BUILDING CONGRESS
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Date: 9/27/04
------------------------------------
Print/Type Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ASSOCIATES
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Date: 10/13/04
------------------------------------
Print/Type Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
14
APPENDIX A
DESCRIPTION OF PROJECT
ATTACHMENT A
DESCRIPTION OF PROJECT
The Port Authority has proposed redevelopment of the entire Terminal 5/6 site at
JFK. The Revised Concept Master plan calls for the phased construction of a new
terminal complex consisting of a total of 47 contact gates and four (4)
hardstand positions.
The existing Flight Wings 1 and 2 of the TWA Terminal would be demolished in
order to accommodate the construction of a new terminal for Jet Blue. However,
the Flight Wings would not be demolished until a lease agreement is reached
between the Port Authority and Jet Blue Airways for the new terminal. Prior to
demolition of Flight Wing 2, the feasibility of removing and/or reusing interior
elements of gate lounge(s) in the new terminal will be explored by the Port
Authority, with input from the Consulting Parties.
The Port Authority will seek to restore/rehabilitate and adaptively reuse the
Main TWA Terminal and the East Tube. The adaptive reuse will be determined
through a Request for Proposals process to be managed by the Port Authority,
with input from the Consulting Parties. The Port Authority will ensure that the
adaptive reuse in the TWA Terminal will accommodate electronic ticketing kiosks
for airline passengers without the need to check baggage.
Jet Blue's new terminal will have 26 contact gates and be connected to the TWA
Terminal through the existing Connector Tubes. Once construction of this phase
of the Revised Concept Master plan is completed, Jet Blue would move its
operations from Terminal 6 to the new terminal. The next phase of the
redevelopment would entail demolition of Terminal 6 to accommodate construction
of the next phase of the Revised Concept Master Plan. This phase will proceed as
the anticipated need for additional gates at JFK materializes and a lease
agreement is reached with an airline (or airlines) for the next phase of the
Revised Concept Master Plan. In addition, a new parking garage will be
constructed across the roadway and AirTrain guide way from the existing Terminal
6 and be connected to the AirTrain station at the existing Terminal 6.
Interested Consulting Parties will have input on these phases of the Concept
Master Plan as they relate to the TWA Terminal/historic resource.
The entire TWA Terminal site will be nominated for listing on the State and
federal Registers of Historic Places. Public access to the TWA Terminal will be
provided via a new direct link from the existing Terminal 6 AirTrain connector
and by vehicular access from the airport roadway system.
APPENDIX B
REVISED CONCEPT MASTER PLAN
ATTACHMENT B
[MAP]
APPENDIX C
MINUTES OF SEPTEMBER 18,2003 MEETING
ATTACHMENT C
Port Authority of New York and New Jersey
October 10, 2003 Report
At the September 18, 2003 meeting of the consulting parties for the
Terminal 5 and 6 Redevelopment Project at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ International Airport
(JFK) it was agreed that the consulting parties along with the Port Authority of
New York and New Jersey (PANYNJ) and the New York State Historic Preservation
Office (SHPO) would take the next 15 days to meet and make another effort toward
working together in order to reach agreement on issues associated with the
proposed concept master plan.
The following represents the results of those most recent meetings
(attendance by organization listed below) regarding the concept master plan for
the Terminal 5/6 site at JFK Airport. Our discussions resulted in a targeted
review of 4 elements of the master plan: the connecting walkways or "tubes"
which link the Main Terminal to the flight wings and gate holdrooms; the removal
and reuse of Flight Wing II; accessibility to/from the Airtrain and the proposed
parking garage to both the landmark structure and the new terminal; and the
adaptive reuse of the Main Terminal.
It was agreed that the goal of preserving the Main Terminal through an
adaptive reuse program would be enhanced by allowing Jetblue Airways to place
self-service ticketing machines within the Main Terminal and by providing easy
accessibility between the Main Terminal and the New Terminal. Connections
between the new terminal and landmark Main Terminal would be a vital part of
realizing a plan that maintains a significant component of the original
structure while supporting an adaptive reuse of the landmark Main Terminal. In
order to meet that objective we agreed that the original connecting walkway
serving Flight Wing II would be preserved in its current configuration. Such
preservation may require structural modifications to the column(s) in order to
allow roadways to pass under the existing "tube". With regards to the connecting
walkway serving Flight Wing I, a hierarchy of options would be investigated as
part of the design for the new terminal. The first option would seek to adapt
the existing configuration in a minimally intrusive manner to improve such
access. If analysis finds this option to be infeasible, then a design for
reconstructing the connecting walkway to incorporate a moving walkway system in
a manner consistent with the original design will be undertaken. Should such an
effort prove to be inconsistent with the objective, and then a contemporary and
appropriate design will be constructed.
After considerable review, it was agreed that both Flight Wing I and Flight
Wing II would be removed, though reuse of two of the gate lounge "trumpets", as
well as other architecturally significant elements as part of the new terminal
concourse and gate holdroom area would be investigated. If feasible, the
inclusion of all or part of the "trumpets" and their original interiors would be
relocated and included as part of the new terminal concourse.
It was agreed that the objective of restoring the Main Terminal for
adaptive reuse, including Jetblue's placement of electronic ticketing machines
within the Main Terminal and re-establishing uses such as restaurants, would be
greatly enhanced by the connectivity of the AirTrain and parking facilities to
the Main Terminal and the new terminal. Providing for such direct access via
realignment of the enclosed connectors from AirTrain that are included in the
concept master plan would be undertaken as part of the new terminal design. As
well, it was agreed that efforts will be made to allow vehicular traffic that
approach the terminal complex the opportunity to access the original frontage
that served the Main Terminal.
As part of the Port Authority's effort to identify a program for restoring
and reusing the Main Terminal so it will remain a vital part of the airport and
this terminal complex, including using the imagery of the landmark terminal as
part of the airport and the Terminal 5 and 6 site, a working committee
consisting of those consulting parties interested, would be formed to assist the
Port Authority as part of an ongoing effort to ensure an appropriate process and
program is implemented.
I believe that these objectives can be incorporated into the concept master
plan as proposed, (see attached drawings)
Attending Organizations: MAS, NYSHPO, PANYNJ, Jetblue Airways, NY Landmarks
Conservancy, NY Building Congress
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APPENDIX D
REDEVELOPMENT ADVISORY COMMITTEE GUIDELINES
ATTACHMENT D
REDEVELOPMENT ADVISORY COMMITTEE
GUIDELINES
1. The consulting parties who voluntarily agree to do so, shall serve as
members of the Redevelopment Advisory Committee (RAC). A representative of
the Port Authority, the SHPO, and a representative of one of the consulting
parties that concur in the MOA, shall serve as Co-Chairs of the RAC. The
consulting party members of the RAC shall select the consulting party
Co-Chair of the RAC. The Co-Chairs shall be responsible for convening
meetings of the RAC, preparing and maintaining a written summary of the
comments received at those meetings as well as those comments received
after those meetings within the time frame set forth in paragraph 5 below,
and for submitting a report of any action taken by the Port Authority or
the SHPO on those comments to the members of RAC.
2. Parties agreeing to be voluntary members of the RAC shall, to the best of
their ability, fully participate in all the proceedings of the RAC.
3. The RAC will meet on the first Tuesday of every other month, or as needed,
at a location(s) to be determined by the Co-Chairs.
4. The RAC shall be given an opportunity at the bi-monthly meetings to
provide, at the appropriate time and stage of the development, as
determined by a majority of the Co-Chairs, input and comment on the
following:
a. Plans, designs, and submittals to SHPO for the
rehabilitation/restoration and adaptive reuse of the TWA Terminal and
East Flight Tube. Such comments shall include comment on the final
design plans for restoration, rehabilitation and adaptive reuse of the
TWA Terminal Building set forth in Stipulation 5 as well as comment
after the completion of such work as set forth in Stipulation 16.
b. A feasibility study and cost analysis for the removal, restoration,
and relocation into the new terminal of selected interior elements of
Flight Wing 2 prior to its demolition.
c. Plans and designs for work to implement the removal, restoration and
relocation of any selected interior elements of Flight Wing 2
(Stipulation 14).
d. Plans and designs for the roadway, pedestrian, and light rail access
to the TWA Terminal.
e. Analysis of options for the reconfiguration of the West Flight Tube as
specified in Stipulation 13, including the plans and designs for any
work to be done in the West Flight Tube to enhance access between the
TWA Terminal and the new terminal.
f. Plans and designs that may be required to structurally modify columns
of the East Flight Tube in order to allow roadways to pass under the
existing tube (See Stipulation 9).
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ATTACHMENT D
REDEVELOPMENT ADVISORY COMMITTEE
GUIDELINES
g. Plans and designs for each development phase of the new terminal to be
built on the Terminal 5/6 site in order to meet the goal specified in
Stipulation 4 of retaining the individual identity of the historic
building, separate from the new terminal in order to avoid, minimize
or mitigate any adverse effect of the new terminal on the historic
building.
h. Plans, designs and content for the interpretative display illustrating
the history and significance of the TWA Terminal site and its
relationship to the overall development of JFK International Airport
set forth in Stipulation 6.
i. Maintenance and preservation guidelines for the treatment of the TWA
Main Terminal Building and East Tube (Stipulation 17).
j. The completed restoration and rehabilitation of the TWA Terminal
Building in accordance with the Secretary's standards as set forth in
Stipulation 16.
5. In order for the RAC to provide meaningful comment and input at the
bi-monthly meetings in a timely manner so as to not adversely affect design
and construction schedules, any plans/designs or other material relating to
specific meeting agenda items shall, to the greatest extent possible, be
provided to RAC members ten (10) days prior to the bi-monthly meetings.
6. In addition to any comments submitted or discussed in the meetings, the RAC
members may provide written comments to the Co-Chairs within ten (10) days
following the meeting.
7. After receipt of all meeting comments, including those received in writing
after the meeting, the Co-Chairs shall prepare a written summary of those
comments and forward them to all RAC members.
8. The Port Authority shall prepare a report on any action taken by the Port
Authority or SHPO on any of the comments summarized in the report prepared
in accordance with paragraph 6 above. Such report shall include any
recommendations, or actual modifications of the studies, analyses, plans
and designs, which were the subject of RAC comment. A copy of the reports
shall be forwarded to the FAA and the ACHP.
9. When a Report is submitted by the Co-Chairs on the last item or items to be
considered by the RAC in accordance with these Guidelines, the Co-Chairs
shall inform the FAA that the consultation process for RAC has been
completed.
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