KINGSTREET TOURS LIMITED AERIAL ADVERTISING AGREEMENT
AGREEMENT made as of the 18th day of January 1994 by and between
Airship International Ltd., a New York corporation ("Airship"), with its
principal place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇ and KINGSTREET TOURS LIMITED, a United Kingdom Company (the "Client"),
with its principal place of business at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇
▇▇▇. Client and Airship are collectively referred to as the "Parties" to this
Agreement:
W I T N E S S E T H:
WHEREAS, Airship is the owner and operator of a lighter-than air
airship to be provided by Airship for use under this Agreement (the "Aircraft");
and
WHEREAS, the Aircraft is suitable for aerial advertising;
and
WHEREAS, the Client wishes to utilize the Aircraft for aerial
advertising and promotion of Client's (and its affiliates') products,
merchandise and services on a fixed fee basis; and
WHEREAS, Airship wishes to furnish the Aircraft and all
equipment, supplies and personnel required to operate the Aircraft under this
Agreement;
NOW, THEREFORE, in consideration of the mutual promises,
covenants and representations contained herein and for other good
and valuable consideration also set forth herein, the parties hereto do hereby
agree as follows:
SECTION ONE
OPERATING FEE, TERM OF THE AGREEMENT
AND DELIVERY OF THE AIRCRAFT
Operating Fee
1.1 Airship shall provide the Aircraft to the Client, with all
equipment, instruments, engines, computers, camera mount facilities, ground
support vehicles, mooring masts, fuel, personnel, (including pilots and ground
crew), necessary for the operation of the Aircraft.
1.2 (a) Subject to the terms set forth in Section 1.4 below,
Client shall pay an operating fee to Airship in the amount of $250,000 per month
for each month for which the Airship shall be operated during the Term of this
Agreement (as defined in Section 1.4(a) herein).
(b) Upon execution of this Agreement, Client shall
pay to Airship $250,000 representing the initial monthly fee. Thereafter, Client
shall pay the monthly installments set forth in Section 1.2(a) (subject to
credit or offset pursuant to this Agreement) on the first business day each
month for which the Airship is operated during the term of this Agreement.
(c) If the Commencement Date of this Agreement
shall be other than the first day of a calendar month or if this Agreement is
terminated as of a date that is not the last day of a calendar month, then the
fee payable by Client to Airship for such
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month shall be prorated based upon the actual number of days in the month
advertising services are provided to Client. Any such excess sums paid by Client
shall be either (i) returned to Client or (ii) applied against Client's second
monthly installment payment, at Client's option.
(d) Payment by Client shall be made to the order of
Airship International Ltd., and shall be made at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ or to such other place as may be designated in writing by
Airship to Client in accordance with the Notice provisions of Section 11.2 of
this Agreement. If any payment due under this Agreement remains unpaid for more
than seven (7) days after the due date hereof, Client shall pay to Airship
interest calculated at the rate of ten (10) percent per annum on the unpaid
principal amount of any overdue payments from the date such payment was due to
the date of payment. Any costs, including reasonable attorney's fees, incurred
by Airship to recover sums due under this Agreement shall be paid by Client.
Flight Time
1.3 (a) Airship shall provide to Client and Client shall schedule
the Aircraft to fly, at least 120 hours of flight time per month of operation,
subject to the limitations set forth in this Section 1.3. Flight time shall be
measured from departure from Aircraft's mooring mast until mooring at said mast
and will be determined by flight meter and/or pilot's log.
(b) Airship shall perform its flight operation
duties and Client shall schedule the Aircraft to fly, on eight (8)
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consecutive hours per day for five (5) days in every week (including Saturdays
and Sundays) during the term of this Agreement (and all extension renewals),
including (i) travel from one base of operations to another; and (ii) required
ground time for mooring, refueling, equipment installation as required, and
boarding of passengers on the Aircraft; and (iii) pre-flight and post-flight
activities, it being expressly understood by Client that during a normal eight
hour work day, up to forty-five (45) minutes before and forty-five (45) minutes
after flights ordinarily must be devoted to pre-flight and post-flight
activities.
(c) Subject to Section 1.3(e) below, if the actual
flight time shall be less than 120 hours during any one full month of operation
(or pro rata for any portion of a month), for any reason other than the
scheduled hangar periods set forth in Section 1.3(g)(ii) of this Agreement, then
Client shall be due compensable flight time as set forth in this Section 1.3.
Compensable flight time shall be defined as one hour of flight time in excess of
120 hours during one full month of operation (or pro rata for any portion of a
month), for each hour less than 120 hours not flown.
(d) In the event Airship does not (i) provide
compensable flight time to Client during the month succeeding the month in which
the compensable flight time accrued, then Client shall have the option to
either: (1) receive a pro rata reduction in the monthly installment payment due
to Airship pursuant to Section 1.2(a) in the next succeeding month after Client
elects to
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take the credit; or (2) receive compensable flight time as defined in Section
1.3 during any portion of the balance of the term of this Agreement or any
renewals thereof. Each hour of compensable flight time shall be assigned a value
of $2,500 for the purpose of computing the pro rata reduction in compensation
due Client under Section 1.3. In the event that the total operating fee provided
for in Section 1.2 (a) has been paid to Airship and Client has opted to receive
a pro rata reduction under this section, Airship shall reimburse Client for the
amount of such reduction within ten business days after Client notifies Airship
in writing that it opts to receive reimbursement rather than compensable flight
time. Compensable time use shall be charged against the earliest accrued
compensable time.
(e) If the actual flight time shall be less than
120 hours during any one full month of operation (or pro rata for any portion of
a month), as a result of Client's failure to schedule the Aircraft to fly for at
least 120 hours in that month then Client shall not be due, under any
circumstances, compensable flight time nor any credit against its monthly
installment pay for such unused flight time.
(f) The required 120 hours of flight time per month
shall be prorated on a daily basis where this Agreement does not commence on the
first day of the month and/or where this Agreement terminates on a day other
than the last day of the month.
(g) Airship shall have the right at its sole
discretion, to withdraw the Aircraft from service (i) whenever
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weather conditions, limitations of the Aircraft, mechanical difficulties,
licensing requirements and/or governmental regulations prevent or limit air
flight and/or may cause damage or injury to the Aircraft or its personnel; and
(ii), after prior consultation with Client, but still at its sole discretion,
for up to two 20-day hangar periods for scheduled airship maintenance.
Term of this Agreement
1.4 The term of this Agreement shall commence on or about January
18, 1994 (the "Commencement Date"). The term of this Agreement shall terminate
six months from the Commencement Date. The parties hereby agree that the
Aircraft shall be operated for a minimum of three months during the Term. The
Client shall notify Airship at last ten (10) days' in advance of each month for
which the Airship will be operated. Notwithstanding anything in this Agreement
to the contrary, Client shall receive a two-week period immediately following
the Commencement Date during which the operating fee obligations of Section
1.2(b) shall not apply. Accordingly, the first month period for operating fee
obligations under Section 1.2 shall consist of one month plus two weeks
following execution of this Agreement. Upon termination of this Agreement,
Airship shall take possession of the Aircraft from Client at the Aircraft's
mooring mast at the geographic location where Client most recently utilized the
Aircraft.
SECTION TWO
OPERATION AND USE OF THE
AIRCRAFT AND AIRCRAFT CREWS
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Use of the Aircraft
2.1 (a) The Aircraft shall be used, exclusively, for the
advertising and promotion of products, services, and merchandise which are sold,
marketed, or otherwise provided for by Client or Client's companies,
subsidiaries or affiliates. Client shall have the right to communicate and make
arrangements with television stations for coverage of the Aircraft during
televised events.
(b) Client shall have the right to advertise the
products, merchandise or services of companies or persons other than those set
forth in Section 2.1(a), including public service messages ("third party
advertisers"), subject to the prior written consent of Airship, which consent
shall not be unreasonably withheld or delayed; provided, however, that it shall
not be considered unreasonable for Airship to withhold its consent to the
advertising and promotion of products under this Section 2.1 where in Airship's
discretion, such advertising (i) is offensive to, or violates community
standards; or (ii) violates any applicable regulations and directives of any
civil aviation authorities having jurisdiction over the Aircraft; or (iii)
violates the terms of any other agreement executed or contemplated by Airship as
of the date of this Agreement with Client or a third party; or (iv) violates any
exclusive right granted another user of an Aircraft provided by Airship under an
exclusive agreement (executed or contemplated as of the date of this Agreement)
for a term of ninety (90) days or more, subject to the limitations of Section
10.2.
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(c) Client shall inform Airship of its intention to
sell advertising space on the Aircraft to a third party advertiser in writing,
setting forth the identity of such advertiser and the terms of such party
advertising. Where such third party advertiser does not then violate an existing
exclusive advertising right granted by Airship under any other agreement entered
into by Airship, Client may continue to sell space to such third party
advertiser without regard to any subsequent agreements entered into by Airship
with other third party advertisers under an agreement between Airship and
another user of an Aircraft provided by Airship.
(d) Airship shall inform Client of any objections
to any proposed third party advertising by Client within five (5) days after
Airship's receipt of written notice from Client of the proposed third party
advertising. Operation of the Aircraft
2.2 (a) Client shall take no action nor require Airship to take
any action that will prevent or limit Airship from operating the Aircraft, and
Airship shall operate the Aircraft, in the following manner:
(i) The Aircraft shall be operated in
accordance with all applicable federal, state, municipal or other laws, rules,
regulations, ordinances and orders now existing or enacted of any jurisdiction
to, from, or through which Airship or Client shall use or operate the Aircraft;
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(ii) The Aircraft shall be operated in
accordance with the manufacturer's approved flight manual and Airship's
operations manual for the Aircraft, engines, equipment, components and
accessories under the guidance of the Federal Aviation Administration ("FAA")
and the Department of Transportation ("DOT") and in accordance with the
applicable regulations an any other civil aviation authorities having
jurisdiction over the Aircraft;
(iii) The Aircraft shall be operated by pilots
and other qualified personnel holding valid licenses and other necessary
authorizations as may be required by applicable laws, regulations and
directives; and
(iv) The Aircraft shall be operated for the
purposes and in the manner set forth in any application for insurance executed
in connection with the Aircraft and in accordance with the terms of any
insurance policies relating to the Aircraft or its operations, and in accordance
with the geographical area covered by the policies of insurance required
hereunder, and in a manner which will not cause a suspension of insurance or
make applicable any exclusionary provision of such policies.
(b) The Aircraft shall not be used or operated:
(i) at any time when the insurance referred to
in Section 4 of this Agreement is not in full force and effect;
(ii) to transport hazardous or perilous cargo;
(iii) in a manner which endangers the Aircraft's
appropriate airworthiness certificate, or in a manner which
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violates or may cause Airship to violate any license, registration or directive
relating to the Aircraft issued by any aviation authority having jurisdiction
over the Aircraft;
(iv) for any purpose for which, in Airship's
discretion, the Aircraft is not designed or suited;
(c) If weather conditions permit, the Aircraft
flight shall generally operate at an altitude of 1,000 feet above ground level
and shall be conducted pursuant to the FAA regulations for Visual Flight Rules;
(d) The Aircraft is or will be permitted to operate
in all areas in which general civil aviation is permitted to operate subject to
weather conditions, physical limitations of the Aircraft and/or governmental
regulations pertaining to the operation of the Aircraft.
Schedules of Operation
2.3 (a) On a weekly or bi-weekly basis, Client and Airship
shall establish the local regional area and hours of operations (the "Local
Regional Schedule") for the Aircraft. Client may reasonably amend the Schedules,
provided, however, that Airship can comply with Client's request. Airship shall
use its best efforts to accommodate such regional changes when requested by
Client, however, Airship specifically reserves the right to refuse its consent
to such amendment whenever Airship (i) is unable to obtain clearance with the
appropriate governmental agencies; and/or (ii) is unable to make appropriate
ground arrangements.
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(b) Airship shall have the right to refuse to fly
the Aircraft in accordance with the Local Regional Schedules of Operations (and
any amendments thereto) whenever in Airship's sole discretion, weather
conditions, physical limitations of the Aircraft and/or applicable governmental
rules or regulations prevent or limit adherence to the Local Regional Schedules
of Operations.
Guests Aboard the Aircraft
2.4 (a) Client shall be permitted to invite guests on board the
Aircraft subject to (i) Airship's prior written consent; (ii) operational
limits, schedules and capacity of the aircraft; and (iii) applicable
governmental rules and regulations; provided however, that Client shall at no
time require Airship to take either cargo or passengers for hire.
(b) All guests of the Client approved by Airship
shall sign a waiver of liability on a form provided by Airship, releasing
Airship, Client, their officers, directors, stockholders, and all related or
affiliated companies from liability for personal or property damage or injury to
such guests. Airship shall obtain such waivers for Client. Airship and Client
shall not permit any guest to board the Aircraft without execution and delivery
to Airship of the required waiver.
Demonstration Flight
2.5 During the term of this Agreement and any extensions thereof,
Airship shall have the right, upon written notice to
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Client, to conduct demonstration flights of the Aircraft during times which
shall not otherwise interfere with the Client's advertising program.
2.6 At Client's option, either (i) Client shall provide all
necessary uniforms for the Airship flight crews and all decals and logos for use
on ground support vehicles or (ii) Airship shall provide such uniforms, decals
or logos conforming to Client's requirements at Client's expense. Such uniforms,
decals and logos shall be cleaned or replaced from time to time by Airship or
Client, as the case may be, in order to main and presentable appearance to the
public. Client's registered trademarks, trade names and other proprietary
property connection with such uniforms, painted logos and decals shall remain
the property of Client and/or subsidiaries and affiliates. In the event that
Client does not require uniforms, decals or logos, the crew of the Aircraft
shall wear Airship uniforms and Airship decals and logos shall be used, at
Airship's expense.
2.7 (a) Notwithstanding anything to the contrary contained
herein, the actual operation of the Aircraft shall remain Airship's sole
responsibility. Airship which shall have sole discretion over the determination
of actual conditions and through its pilot in command of the Aircraft, shall
make the final determination whether geographic, topographic and/or weather
conditions are within acceptable limits to permit the Aircraft to fly.
(b) Where any proposed flight is cancelled, or
there is a deviation from the Local Regional Schedule of Operations
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as a result of (i) prevailing or forecast weather conditions; (ii) topographic
problems; and/or (iii) physical limitations of the Aircraft, then the pilot in
command of the Aircraft shall make a notation regarding the circumstances for
such cancellation or deviation in the Aircraft's logs.
SECTION 3
REPRESENTATIONS, WARRANTIES AND COVENANTS
3.1 (a) Airship represents, warrants and covenants
that:
(i) The Aircraft shall measure approximately
194 feet in length, 62 feet in height, and 50 feet in width; (ii) The Aircraft
will be a certified standard type aircraft under the laws of the International
Civil Aviation Organization (ICAO);
(iii) As of the Commencement Date, Aircraft
shall have a valid Certificate of Airworthiness issued by the country of origin
or the FAA, and Airship shall maintain valid certificates of airworthiness for
the Aircraft at all times.
(iv) The Aircraft is, or will be on the
Commencement Date, in good condition and usable for the purposes
contemplated by this Agreement; and
(v) Airship shall maintain registration of the
Aircraft under applicable laws during the term of this Agreement, and shall
obtain and maintain in effect, the required approvals of the FAA, DOT and any
other aeronautical authorities having jurisdiction to operate the Aircraft in
the United States.
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(b) As owner and operator of the Aircraft, Airship
shall be responsible for performance of all Aircraft overhaul, engine overhaul
and maintenance required during the terms of this Agreement under the guidance
of the regulations of the FAA, DOT or other governmental authority having
jurisdiction over the Aircraft.
(c) Airship shall maintain all records, logs and
other materials required by the FAA, DOT, or other governmental authority having
jurisdiction over the Aircraft. Airship agrees to permit Client, or its duly
authorized agents or representatives, to inspect the Aircraft and its logs upon
reasonable notice to Airship.
(d) Prior to the Commencement Date, the Aircraft
and ground support equipment shall be painted and/or decaled by Airship in an
exterior paint or decal design in accordance with Client's specifications, which
design is annexed hereto as Exhibit A. Airship shall maintain the paint and/or
decals in a clean and orderly condition for the term of this Agreements. Client
shall have the right to change the paint scheme of the Aircraft envelope and/or
ground support equipment at any time during the term of this Agreement and all
renewals thereof, provided Airship receives at least sixty (60) days written
notice of the change. A charge of Fifty Thousand ($50,000) Dollars will be
payable by the Client to Airship for each subsequent redesigned paint scheme for
the Aircraft and support equipment, if any, which Client may require. All
operating time lost on account of such change by the Client shall constitute
"flight time" under Section 1 and Client shall not
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receive any credit or compensable flight for such lost operating
flight time.
(e) Airship shall maintain, service and repair the
Aircraft so as to (i) keep each component of the Aircraft in operating
condition; (ii) meet the requirements of the maintenance plans recommended by
the manufacturers of the engines, envelope and gondola comprising the Aircraft;
(iii) keep the Aircraft certified as airworthy by the governmental agency with
jurisdiction over the Aircraft; (iv) comply with any other governmental
authority airworthiness directives applicable to the Aircraft; and (v) keep the
Aircraft clean and in suitable condition to provide services required under this
Agreement.
(f) Airship shall maintain, service and repair all
ground support vehicles and equipment supplied by so as to (i) keep the
components thereof in good operating condition; (ii) keep such vehicles and
equipment properly licensed and (iv) keep the vehicles and equipment clean and
in good condition fit to provide the service required of Airship hereunder.
(g) Airship represents and warrants that all
necessary approvals, licenses and permits required by the DOT, FAA, or other
required federal, state or local governmental authority necessary for the
execution of this Agreement have been or will be obtained prior to the
commencement of this Agreement and that if required, such approvals, licenses
and permits shall be maintained in effect during the term of this Agreement.
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3.2 Airship represents and warrants that (i) Airship is a
corporation duly organized and validly existing under the laws of the State New
York; (ii) Airship is duly qualified and authorized to do business jurisdiction
where the nature of its business makes such authorization necessary; (iii)
Airship has the power, authority and legal right to enter into and perform this
Agreement and the execution, delivery and performance of this Agreement have
been duly authorized by all necessary corporate action of Airship; (iv) the
execution of this Agreement and compliance with its terms and conditions will
not contravene any permit applicable to Airship, nor conflict with, or breach of
the terms and condition hereof, nor constitute a default under the Articles of
Incorporation or By-Laws of Airship or any agreement or instrument to which
Airship is now a party; (v) this Agreement constitutes a legal, valid and
binding obligation of Airship; and (vi) there are no suits, actions or
proceedings pending, or to Airship's knowledge, threatened, in court or before
or by any regulatory commission, board or other administrative agency which may
have a material adverse effect on the business, operations or financial
condition of Airship.
3.3 Client represents and warrants that (i) Client is a
corporation duly organized and validly existing under the laws of the United
Kingdom: (ii) Client is duly qualified and authorized to do business in each
jurisdiction where the nature of its business makes such authorization
necessary; (ii) Client has the power, authority and legal right to enter into
and perform this Agreement
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and the execution, delivery and performance of this Agreement have been duly
authorized by all necessary corporate action on the part of Client; (iv) the
execution of this Agreement and compliance with its terms and conditions will
not contravene any franchise or permit applicable to Client, nor conflict with,
or result in a breach of the terms and conditions here, nor constitute a default
under the Articles of Incorporation or By-Laws of Client or any agreement or
instrument to which the Client is now a party; (v) this Agreement constitutes a
legal, valid and binding obligation of the Client; and (vi) there are no suits,
actions or proceedings pending, or to Client's knowledge, threatened, in court
or before or by any regulatory commission, board or other administrative agency
which may have a material adverse effect on the business, operations or
financial condition of Client.
SECTION FOUR
INSURANCE
4.1 (a) During the term of this Agreement, Airship shall procure
and maintain the following insurance coverage:
(i) Comprehensive Aviation Liability Insurance
with respect to the use and operation of the Aircraft, having single limit of
not less than $100,000,000.00, insuring and covering Airship and as an
additional insured pursuant to section 4.1(b)(i) Client, against all
liability for injury, damage or claims caused by or arising out of, or in
connection with the injuries to, or deaths of passengers or third persons or
damage to property;
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(ii) Automobile Liability Insurance or other
general liability insurance covering all owned and rented/hired automobiles,
trucks, trailers, and other vehicles and ground support equipment used by
Airship in the performance of its duties under this Agreement. Such insurance
shall provide coverage of not less than the Standard Comprehensive automobile
Liability Policy in limits not less than $10,000,000 combined single limit each
occurrence for Bodily Injury and Property Damage; and
(iii) Worker's compensation insurance in
conformity with the statutory limits of the states in which Airship shall be
required to carry such insurance.
(b) The liability insurance as set forth in
Section 4.1(a)(i) and (ii) shall include the following:
(i) Additional Insured: Client and its
subsidiaries and affiliates and their respective assigns, officers, directors
and employees, and ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and Tourlight
Inc., a Delaware corporation ("Tourlight"), shall be included as additional
insured under Section 4.1(a)(i) and (ii) with respect to the use and operation
of the Aircraft;
(ii) Waiver of Subrogation: The insurers shall
agree to waive their rights of subrogation against client and its subsidiaries
and affiliates and their respective agents, assigns, officers, directors and
employees;
(iii) Breach of Warranty: Such insurance as is
afforded Client shall not be invalidated by any act or neglect of Airship
whether or not such act or neglect is a breach or
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violation of any warranties, declarations of conditions of the policies;
provided, however, that the policy or policies providing the Automobile
Liability Insurance and other coverage provided for in Section 4.1 (a)(ii) may
be interpreted by the insurance underwriter thereof in such a manner as to
invalidate or restrict coverage for Client if the coverage for Airship shall
have been invalidated or restricted due to a breach of warranty by Airship.
(iv) Cross Liability: The inclusion of more
than one corporation, person, organization, firm or entity as Insured under the
policy of insurance shall not in any way affect the rights of any claim, demand,
suit or judgment made, brought or recovered, by or in favor of any other
insured, or by or in favor of any employee of such other insured. This policy
shall protect each corporation, person, organization, firm or entity in the safe
manner, as though a separate policy had been issued to each, but nothing herein
shall operate to increase the insurer's liability as set forth as limits to the
policy beyond the amount or amounts for which the Insurers would have been
liable if only one person or interest had been named as insured.
(v) Primary: With respect to such insurance as is
afforded to the additional insured specified above, this insurance shall be
primary with respect to damages or claims arising from acts or omissions by
Airship without right or contribution from any other insurance which is carried
by the Client.
(vi) Cancellation: Insurers shall agree that, in
the event they cancel or materially change such insurance policies, they
will give (30) days advance written notice (seven days in the case of war risk)
of such cancellation or material change to Client.
(vii) Geographic Limits: The geographic
limits of such insurance shall include all states within the continental United
States.
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(viii) Certificate of Insurance: At least ten
(10) days prior to the commencement of this Agreement and from time to time as
Client shall reasonably request, and prior to each renewal date of the
insurance, Airship shall furnish to Client certificates and cover notes
(summarizing policies) evidencing that the foregoing liability insurance is in
full force and effect.
SECTION FIVE
INDEMNITY
5.1 Airship hereby assumes liability for, and
hereby agrees to indemnify, reimburse, protect, save and hold harmless Client,
its subsidiaries and affiliates and their successors, assigns, agents, employees
and servants, and ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and Tourlight,
from and against, all claims, actions, suits or legal proceedings, in connection
with the purchase, ownership or, operation, lease of the aircraft, ground
support vehicles and equipment. This indemnity shall not however extend to (i)
claims arising from the advertising and promotion of Client's advertising copy
on the Aircraft or the advertising copy of third party advertisers; (ii) any
injury due to the negligence (in material part) or intentional acts of Client or
its third party advertisers or their officers, directors, agents, employees or
those of any affiliated company; and (iii) any sales, use or other similar tax
assessed to a user of goods and/or services which shall be the sole obligation
of the Client.
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5.2 Client hereby assumes liability for and hereby agrees to
indemnify, reimburse, protect, save and hold harmless Airship, its successors,
assigns, agents, employees and servants, from and against, any and all claims,
actions, suits, or legal proceedings, in any way related to the advertising and
promotion of Client's and its third-party advertiser's advertising copy on the
Aircraft or, any injury due to the negligence (in material part) or intentional
acts of Client or its third party advertisers, or their officers, directors,
agents, employees or those of an affiliated company or any sales, use or other
similar tax imposed on Airship as a result of the operation of the Aircraft on
behalf of Client.
SECTION SIX
GRAPHIC, COPY AND PROGRAMING
6.1 Airship shall prepare and maintain a fixed electric
NightSign(TM) on each side of the Aircraft.
6.2 All advertising of Client and its third-party advertisers
shall be in good taste and conform to the community standards. Airship shall
have the right to refuse to display copy which, in Airship's sole discretion,
does not comply with community standards.
SECTION SEVEN
COMMERCIAL EXPLOITATION OF AIRCRAFT
7.1 (a) Client may commercially exploit the likeness of
the Aircraft including the use of the Aircraft, for photographic
purposes and the taping of commercials and on items of merchandise
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during the term of this Agreement and for a period of 18 months after the
termination or expiration of this Agreement, after which time Client agrees not
to commercially exploit the Aircraft or its likeness.
(b) Client shall have the right for a period of one
(1) year after termination of this Agreement, to sell, distribute or give-away
all merchandise or products already produced or manufactured by or for Client
which commercially exploit the Aircraft or its likeness for the purposes of
liquidating the merchandise or give-aways. Notwithstanding the foregoing, Client
may use all of its existing inventory of brochures, souvenir books, and other
materials which include a photograph of the Aircraft until the inventory is
exhausted.
SECTION EIGHT
CONDITION PRECEDENT
8.1 The obligations of Client and Airship to perform its
respective obligations under this Agreement are specifically conditioned upon
the issuance and continuance by DOT and any other applicable governmental
authorities of all necessary permits for commercial air operations of the
Aircraft in connection with this Agreement and the Schedule of Operations by no
later than the Commencement Date.
SECTION NINE
EVENT OF DEFAULT
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9.1 The occurrence of any one of the following events will be
deemed to be and shall be treated as a default under this Agreement and just
cause for its termination by the non-defaulting party:
(a) Breach or failure by either party in the due
observance or performance of any term, covenant, warranty, representation or
agreement contained in this Agreement, which breach or failure continues
unremedied or uncorrected for a period of ten (10) days after written notice by
the non-breaching party to the defaulting party, which notice shall specify the
breach and require that it be remedied; or
(b) (i) Either party shall admit in writing its
inability to pay its debts, or shall make a general assignment for the benefit
of creditors; or (ii) any proceeding shall be instituted by or against either
party seeking to adjudicate such party as bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment or composition of its debts under any
law relating to bankruptcy, insolvency, reorganization, or relief of debtors, or
seeking appointment of a receiver, trustee or other similar official for such
party or for any substantial part of their property, and such proceeding shall
not have been dismissed within ninety (90) days; or (iii) either party shall
take any action to authorize any of the actions set forth above in this
subsection (b); or
(c) The operation of the Aircraft (i) without a
valid Certificate of Airworthiness in effect; or (ii) by any
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operator other than Airship, its authorized agents, servants or
employees.
SECTION TEN
RESTRICTIVE COVENANT
10.1 Airship does hereby covenant and agree that during the term
of this Agreement and all renewals thereof, that it shall not operate any
lighter-than-air aircraft for the purpose of advertising for any other musical
groups.
10.2 Client does hereby covenant and agree that during the term
of this Agreement and all renewals thereof, nothing herein shall prevent Airship
from operating any lighter-than-air aircraft for any other person or third
party, and nothing herein shall prevent Airship from entering into negotiations
and/or binding aerial advertising agreements with other clients for the
operation of additional aircraft owned or acquired by Airship, subject to the
restrictions set forth in Section 10.1 herein.
SECTION ELEVEN
MISCELLANEOUS
11.1 Client acknowledges and agrees that it does not and will not
acquire by this Agreement, any legal or equitable right, title or interest
whatsoever in the Aircraft or the proceeds of the sale of the Aircraft, or in
Airship's equipment, instruments, engines, computers, ground support vehicles or
mooring masts. Client acknowledges and agrees that it has not obtained nor will
obtain any license to use the likeness of the Aircraft as a
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result of this Agreement, except as may be expressly set forth
herein.
11.2 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given unless otherwise
provided herein, if delivered in person or mailed by certified mail, returned
receipt requested, with first call postage prepaid;
(a) If to Airship:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
with a copy to:
▇▇▇▇ Marks & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
(b) If to Client:
Kingstreet Tours Limited
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇ ▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
such names and addresses may be changed by written notice to each person listed
above, provided that any change of address shall be effective only on receipt.
11.3 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York,
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without giving effect to the principles of conflict of laws
thereof.
11.4 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument.
11.5 Headings. The section headings contained in this Agreement
are for reference purposes only and shall not effect in any way the meaning or
interpretation of this Agreement.
11.6 Entire Agreement. This Agreement, including the schedules
and documents annexed hereto, and the documents and the documents and agreements
referred to herein, embodies the entire agreement and understanding of the
parties with respect to the subject matter contained herein. There are no
restrictions, promises, representations, warranties, covenants or undertakings
other than those expressly set forth or referred to herein. This Agreement
supersedes all prior agreements and understanding between the parties with
respect to the subject matter of this Agreement.
11.7 Parties in Interest. This Agreement shall not be assignable,
except with the express written consent of the other parties hereto. This
Agreement shall inure to the benefit of and be binding upon the parties and
their respective successors and permitted assigns. Except as otherwise expressly
contemplated hereby, nothing in this Agreement, express or implied, is intended
to confer upon any other person any rights or remedies under or by reason of
this Agreement.
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11.8 Severability. If any term, covenant, condition or provision
of this Agreement or the application thereof to any person or circumstances
shall, at any time or to any extent, be rendered invalid or unenforceable, the
remainder of this Agreement or the application of such term or provision to
persons or circumstances other than those to which it is held invalid or
unenforceable, shall not be affected thereby, and each term, covenant, condition
and provision of this Agreement shall be valid and be enforced to the fullest
extent permitted by law.
11.9 Amendment and Modification. This Agreement may be amended or
modified only by written agreement of the parties hereto or their successors or
assigns.
11.10 No Third Party Beneficiaries. This Agreement does
not create, and shall not be construed as creating, any rights
enforceable by any person not a party to this Agreement.
11.11 Risk of Loss.
(a) During the term of this Agreement, the risk of
loss with respect to the aircraft shall be upon Airship. In the event that (i)
the Aircraft is subject to minor damage or injury; and/or (ii) the Aircraft is
grounded due to accident, mechanical failure and/or licensing, approval or
permit difficulties (other than weather interference or Client's actions), then
the obligations of the parties under this Agreement shall ▇▇▇▇▇ until such time
as the Aircraft or a replacement aircraft is certified and authorized to fly, at
which time continue in full force and effect; provided, however, this Agreement
shall be null and void as
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of the date the aircraft is grounded where the abatement exceeds
three (3) months.
(b) In the event that a total loss of all or
substantially all of the Aircraft shall occur and a replacement aircraft cannot
be provided by Airship, Airship shall promptly give written notice of such loss
to Client, in which event this Agreement shall terminate and be of no further
force and effect; provided, that in such event, a pro rata portion of the
monthly fee (based on the number of days remaining, following such total loss,
in the month of such total loss) paid pursuant to Section 1.2 by Client to
Airship for the month in which such total loss occurs shall be reimbursed to
Client by Airship.
11.12 Upon termination of this Agreement, Airship shall promptly
fly to a suitable hangar and remove all logos and other materials belonging to
Client within ninety (90) days after such termination.
11.13 Submission to Jurisdiction; Waiver of Jury Trial.
A. The Client hereby irrevocably and unconditionally:
(i) submits for itself and its property in any
legal action or proceeding relating to this Agreement, or for recognition and
enforcement of any judgment in respect thereto, to the non-exclusive general
jurisdiction of the State of New York, the courts of the United States of
America for the Southern District of New York, and appellate courts from any
thereof;
(ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection
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that it may now or hereafter have to the venue of any such action or proceeding
in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(iii) agrees that service of process in any
such action or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to the Company at its address set forth in subsection 11.2 or
at such other address of which the Agent shall have been notified pursuant
thereto; and
(iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to ▇▇▇ in any other jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first above written.
AIRSHIP INTERNATIONAL LTD.
By: ▇▇▇▇ ▇▇▇▇▇▇
--------------------------
KINGSTREET TOURS LIMITED
By: [signature]
---------------------------
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